Ecommerce Manager Interview Question:

Tell us does the business' compensation model support or undermine its goals?

Submitted by: Muhammad

In an ideal world, a compensation model should be developed before an e-commerce search begins. From a basic planning standpoint, that is obvious. However, there is another, more critical reason. Compensation models that focus almost exclusively on increasing online sales can cause internal strife at the company. Since an online sale may come at the expense of a store sale, retail-side leaders may feel threatened by e-commerce initiatives in a battle over the customer. According to the 2009 State of Retailing Online report from Shop.org, companies have adjusted their management and incentive structures to better align the online division with the rest of the company and vice versa.
One important area to address will be assigning credit for in-store revenue generated online. Successful compensation models also may emphasize shared credit for revenue performance and multi-channel sales, as well as companywide strategies around buyer loyalty and customer satisfaction. Not only will a successful compensation model avoid debilitating, money-losing rivalries, but it will incentivize cooperation across business lines. When recruiting e-commerce talent, the candidate will inquire about how his or her bonus will be measured.
Submitted by: Muhammad