Magazine article Marketing

Just Rewards

Magazine article Marketing

Just Rewards

Article excerpt

Despite their bad press, bonuses are an important way to motivate marketers.

Bonuses are back in the spotlight after analysts recently suggested that bankers' payouts would rocket by 50% this year. The public outrage associated with such rewards made them synonymous with the worst excesses of capitalism.

However, despite being brought into disrepute by greedy City bankers, bonuses have long been part of many marketers' remuneration packages at companies from P&G and Unilever to HSBC, eBay, Audi and O2. For those companies that offer them, bonuses have proved an effective way to motivate their marketing teams.

Yet, in contrast to bankers, many marketers have found their bonuses shrinking over the past year.

Marketers received an average bonus of pounds 2500 this year, down from pounds 3000 in 2008, according to a survey of 1300 companies carried out by the Chartered Institute of Marketing (CIM) and Croner Reward in May and June. The maximum bonus potentially available to marketers also fell, from pounds 4500 to pounds 4000. Nonetheless, while the percentage of basic salary awarded as a bonus fell from 9.4% last year to 8%, the proportion of marketing directors and marketing managers receiving a bonus was up 5% and 2% respectively.

Part of the reason for the slump is obvious. If a company runs a bonus scheme, rewards are generally paid out to all staff across the organisation and are directly linked to company income.

As profits have tumbled in the wake of the economic crisis, so bonus payments have, naturally, followed suit.

As an HSBC spokesman puts it: 'If profitability is down, marketers' bonuses will be too, although there is always a need to reward performance.'

Marketers face an additional challenge: bonuses are often tied to their individual performance, the direct impact of their role on company profits and how far they have met personal objectives.

In the current economic climate, such targets can prove elusive and proof of a marketers' direct impact difficult to quantify.

One senior brand manager at a top FMCG company says: 'While bonus structures have remained the same, the goalposts have shifted. For many marketers, objectives were set before the recession kicked in. With many marketing budgets now slashed, these targets have become impossible to meet. Marketers are therefore falling short and missing out on their full bonuses. These workers will have a much bigger fight on their hands this year to get the bonuses they deserve. …

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