Fifty-eight percent of B2B organizations don’t consider their sales territory mapping efforts effective, according to Sales Management Association (SMA) research. The study found that these organizations fell short of 3 key indicators of effectiveness:
- Securing accurate data inputs
- Leveraging the right technology
- Redesigning territories with appropriate frequency
This ineffective sales territory mapping is costing them dearly since thoughtful sales territory optimization and mapping have been found to drive a 10-20% increase in sales. That’s only one of several reasons to improve your sales territory mapping efforts.
How to Build a Comp Plan for a New Territory
Sales territory planning can be tricky, but it’s especially challenging to get new territories right with so many unknowns. The more you know, the easier it is to create territories that deliver results and support your sales reps.
Read MoreWhy Sales Territory Mapping Matters
There are many benefits to investing the time and effort in improving your sales territory mapping.
Optimizes Sales Coverage: Effective territory mapping ensures that all potential customers and market segments are adequately covered, preventing missed opportunities. It also helps maximize sales efficiency by allocating resources where they are most needed.
Balances Workloads Among Sales Reps: Territory mapping distributes leads and accounts evenly among sales reps, avoiding overburdening some reps while underutilizing others. Balancing workloads helps maintain morale and reduce burnout among the sales team.
Improves Customer Relationships and Satisfaction: Well-defined territories allow sales reps to focus on building stronger relationships with customers within their assigned areas. This facilitates consistent, localized attention that can lead to higher customer satisfaction and loyalty.
Aligns with Business Goals and Strategies: Mapping territories strategically aligns sales efforts with the company’s broader goals, such as expanding into new markets or increasing market share in specific regions. It can also support targeted sales campaigns and marketing efforts by focusing on specific geographic or industry segments.
Enhances Sales Performance and Productivity: Territory mapping helps identify high-potential areas and allocate the best resources to maximize sales opportunities. Clear territories can reduce internal competition and conflicts, leading to a more collaborative and product sales environment.
Facilitates Performance Tracking and Analysis: Well-defined territories make it easier to track performance metrics and analyze data by region or rep. This enables quick identification of underperforming territories, facilitating data-driven decisions to adjust strategies or resources.
Supports Fair and Effective Compensation Planning: Territory mapping contributes to fair compensation by ensuring that sales reps have equitable opportunities and resources. This, in turn, prevents disputes over lead ownership and sales credit, creating a more transparent and equitable environment.
Aids in Resource Allocation and Planning: Territory mapping helps efficiently allocate resources such as sales support, marketing efforts, and travel budgets. It allows companies to plan for growth by identifying where to expand sales teams or add new reps.
Key Components of Effective Sales Territory Mapping
Here’s what it takes to gain the many advantages of optimizing your sales territories.
| Component | Practice |
| Clear Definition of Territories | Establish well-defined boundaries based on geographic regions, customer types, industry verticals, or market segments. |
| Data-Driven Analysis | Use historical sales data, customer demographics, and market potential to inform territory allocation and boundaries. |
| Balanced Workloads | Ensure an equitable distribution of leads, accounts, and opportunities among sales reps to prevent overloading and maximize coverage. |
| Alignment with Business Goals | Align territories with the company’s strategic objectives, such as market expansion, revenue growth, or focus on key customer segments. |
| Consideration of Sales Rep Strengths | Align territories with the company’s strategic objectives, such as market expansion and revenue growth, or focus on key customer segments. |
| Integration with Sales and CRM Tools | Leverage technology, such as customer relationship management (CRM) software and sales mapping tools, to visualize and manage territories effectively. |
| Regular Review and Adjustment | Match sales territories with individual reps’ skills, experience, and expertise to optimize performance. |
| Minimization of Territory Overlap | Design territories to minimize overlap and reduce internal competition and conflicts over customers or leads. |
| Clear Communication to Sales Team | Provide transparent guidelines and rationale for territory assignments to ensure buy-in and understanding from the sales team. |
| Performance Tracking and Reporting | Establish metrics and reporting systems to track sales performance by territory, allowing for data-driven strategy adjustments. |
| Flexibility and Scalability | Continuously monitor territory performance and adjust boundaries to respond to market changes and internal shifts. |
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Start TrialSteps to Create a Sales Territory Map
Leverage these steps to build an effective sales territory map.
- Define, analyze, and segment your market: Segment customers by characteristics such as industry, location, or purchase history. Sort each segment by the level of effort required. Then analyze sales data for each sales territory to identify key trends to help match them to the rep most likely to be effective there based on the strengths you identify in the following SWOT analysis.
- Conduct a SWOT analysis: A SWOT analysis allows you to identify internal and external factors that influence your company’s performance. Assess the sales team’s strengths and weaknesses collectively and individually. Then identify marketplace opportunities such as untapped markets, under-served territories, and growing demand for your product or service. Finish the analysis by looking at the greatest selling threats in each territory such as competitors or new regulatory standards.
- Establish clear goals and realistic targets: Based on the identified trends, threats, and opportunities, set goals and milestones for the sales team and reps. Things to consider include:
- The number of opportunities you need to meet quota
- Which geographic regions produce the most leads
- Which product or service is most profitable and who purchases them
- Which opportunities to prioritize.
- Determine strategies to achieve your goals: Now, you have sufficient information to distribute regions or markets evenly across the sales team. The SWOT analysis helps you assign the best reps for each territory based on their strengths. Then, consider how you will support your sales team’s efforts to achieve their goals, such as generating leads and offering resources.
- Continuously monitor results: Sales territory mapping is an ongoing process. It routinely reviews and tracks results to help keep the territory map aligned with market and business changes by adjusting it accordingly. Key metrics to monitor include sales growth, sales rep performance, and territory costs.
Common Challenges
As SMA found in their study, accurate data, the right technology, and revision frequency greatly impact sales territory mapping effectiveness. Skipping a key step in the process can also limit your results. Being aware of these common challenges will help boost your territory mapping effectiveness.
Unequal Distribution of Opportunities
Poorly defined territories can result in uneven account, opportunity, and lead distribution, overloading some reps while others are underutilized. Unequal opportunity allocation can lead to poor morale, decreased motivation, and reduced performance.
Territory Overlap and Internal Competition
Problems can arise when territories overlap, leading to conflicts between sales reps over customer ownership and sales credit. This type of internal competition negatively impacts the team, creating a divisive sales environment and detracting from collaborative efforts.
Inaccurate or Outdated Data Usage
Relying on inaccurate or outdated data when defining territories can lead to misalignment with current market conditions or customer bases. Therefore, up-to-date and comprehensive data ensures territory relevance and effectiveness.
Inflexibility in Territory Design
Rigid territory boundaries can hinder adaptability in response to market changes, such as new competitor movements or shifts in customer demand. However, dynamic territory planning allows for regular updates and adjustments.
Misalignment with Business Strategy
Territories that don’t align with the company’s strategic goals, such as market penetration or targeting new verticals, can reduce sales effectiveness. Aligning territory design with business objectives drives growth.
Overlooking Sales Rep Skills and Strengths
Assigning territories without considering sales reps’ specific skills, experience, or strengths, leads to suboptimal performance. However, matching territories to rep competencies results in better sales outcomes.
Inconsistent Territory Management Practices
A lack of standardized practices for territory management can lead to confusion and inconsistency in execution. Implementing clear guidelines and regular training helps by ensuring uniformity in territory management.
Resistance to Change from Sales Team
Changes in territory assignments can lead to resistance or pushback from the sales team, especially if they feel the changes are unfair or poorly communicated. Manage change effectively by preparing and implementing a proper communication plan to introduce changes. Taking the time to explain how territories have changed and why and how each rep will be impacted is essential to gaining team buy-in. Also, allowing reps the opportunity to get answers to their questions boosts trust and morale.
Insufficient Performance Tracking and Feedback
Not having adequate systems for territory performance analysis and gathering feedback from the sales team can hinder effective sales territory mapping. Robust tracking and feedback mechanisms are essential for continuous sales territory optimization.
These common challenges stem from SMA’s findings. However, you can proactively address these issues through strategic planning, data-driven decisions, and continuous improvement.
Tools and Software for Sales Territory Mapping
Here are a few of our favorite sales territory mapping tools.
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Talk to SalesTailor Comp Plans by Territory
To boost sales productivity by up to 20%, improve the effectiveness of your sales territory mapping efforts. You can accomplish this using consistent process, strategic planning, data-driven decisions, and continuous improvement.
QuotaPath partners with companies to tailor comp plans per territory and automate commission management. To learn more, schedule a time with a team member.
