Executive compensation drives executive decision making, as well as company goals.
Every executive wants to maximize their job performance and, by extension, their pay. Knowing an individual’s compensation structure allows you to tailor your sales pitch to their priorities. The more personal your pitch, the better.
However, regardless of who you’re talking to or how well you know them, you need to know the details of executive compensation, where to find it, and most importantly, how to discuss it appropriately.
Executive Compensation Basics
Executives are paid in a variety of ways: performance bonuses, stock options, or a percentage of profits. Depending on their compensation, executives will want to maximize the business elements that affect their compensation.
You can use your customer’s compensation to get their attention. Consider how your offerings can impact profits if an executive’s compensation is based on profits. Without being creepy, say, “I know you’re compensated on profits, so you’ll like what my solution can do,” but clearly state any benefit that directly impacts them.
Executives usually receive annual and long-term incentives in addition to salary. The only incentives left are short- and long-term goals. Annual compensation metrics goals are more tangible and easier to link to your solution than strategic goals.
Finding Compensation Data
The question is, where can you find information on how to do this?
The good news is that executive compensation is often public information. In the US, publicly traded companies include that information in their definitive proxy statement (SEC Form DEF 14A).
Outside the US, compensation data is in the annual report under “Remuneration” or “Compensation.” Visit the company’s website and look under tabs like “Investor Relations” and “Financial Statements.”
Remember that data accuracy varies by country due to cultural differences. North American and European countries tend to be more open about this information, while Asian countries tend to generalize it.
How to Talk About Compensation
Once you have compensation data, discuss it diplomatically. There are proper and improper ways to discuss compensation. Here are a few examples:
“I know you made $2.65 million last year, but wouldn’t it be nice to hit your net income and return on equity targets? I can help you with your customer satisfaction and loyalty programs. Then you can finally afford to take Mrs. Benjamin on that world trip!”
That tone is off. Another way to bring it up:
We want to help you get your product to market faster, which will improve net income, return on equity, risk and strategic initiatives.
In the second example, you don’t sound stalkerish, but you’ve communicated benefits that the buyer will relate to.
The caveat is that you should always consider the buyer’s relationship. Assume “not creepy” if this is your first conversation. Then you can speak directly to their compensation without making them feel uncomfortable.
Executive compensation can help personalize and attract attention to your sales pitch, but there are proper and improper ways to discuss it. Don’t be creepy or overly personal with strangers.
Not to mention the bonus metrics. Just mention how your solution drives key metrics and let the executive link this to their bonus. Again, make the connection between your solution and the outcomes they value, and your pitch will instantly become more personal.