How Activity Quota Works

Due to an activity quota, a salesperson might be required to submit a specific number of work statements, make a specific number of outbound calls, or send potential clients a specific number of emails. A salesperson may encounter a version of an activity quota regarding converting potential clients to purchase a product. The activity quota's design makes sure that the salesperson is attracting a baseline number of new clients.

Activity quotas are essentially linked to any actions that might lead to sales. It is also used as a means of measuring the salesperson's effort. Management may reward employees as they exceed the goals. Rewards could come in the form of bonuses, commissions, promotions, or special recognition.

In some big companies like Samsung and Apple, the company representative doesn't have to struggle to make a sale; the products essentially sell themselves. Meanwhile, other companies deal with services and goods that don't yet have a strong brand or are a part of multilevel marketing structures requiring vendors to make as many sales as possible to earn a commission. Some services include financially related services like insurance, banking, financial planning, real estate, home security, or retail.

Example of an Activity Quota

James is a salesperson for TechZ that sells electrical gadgets. The company TechZ sells devices like phones, tablets, laptops, etc. Every month, James is required to send 200 emails, make 250 phone calls (both follow-up and cold calls), and engage with 60 people through various TechZ social media channels.

TechZ has determined that the activity quota could potentially result in 50 new sales each month. Fortunately for James, his effort, primarily through social media, earned him well over 50 sales. As a result, he received a 50% commission on those additional sales. James must now repeat the same process as the new month begins to reach his activity quota set by TechZ executives.

Significance of Activity Quota

To measure the efforts of a salesperson, the employer uses the principle of activity quota. Due to the age of social media, the activity quota channels are changing. Even though cold calling is still used, social media techniques are tending to replace it. Due to businesses embracing social media, potential customers can tweet, like, or click on links associated with either a service or a product.

Social media has made it possible for a salesperson to focus their efforts on certain aspects of the sale of the services or products. For instance, imagine you are a financial advisor who makes up to 200 calls in a week. If you used social media and 60 people positively react to your post, you might only contact those interested in your services.

Social media has significantly changed the amount, types, and level of interest used to meet a company's activity quota. Salespersons should utilize the brands' social media and their own various platforms to make the most of their reach.