Marketing Communications

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Marketing Communications

264

Personified Promotion

TYPES OF DIRECT FINANCIAL SYSTEM

1. FIXED SALARY: this is a time wage paid at a flat rate per week or month.


2. STRAIGHT COMMISSION PLAN: this is based on the assumption that sales volume should
   be used to determine remuneration.


3. COMBINATION SALARY AND INCENTIVE PLAN: the combination salary and incentive
   plan is based on balancing the advantages and disadvantages in the two systems of
   compensation plan to be able to achieve a blend of the two basic plans. Management seeks
   both control and motivation of salespeople by adapting this form of compensation plan.


4. BONUSES: a bonus is an amount paid for accomplishing a specific sales task; it is different
   from commission because it does not vary with sales volume.

TYPES OF INDIRECT FINANCIAL INCENTIVES

These are extras on basic pay plan which are non cash in nature and have no direct relationship to overall
sales performance. Examples are:

•    Fringe benefit

•    Selling expenses

•    Sales contests