B2B SaaS Sales Compensation in 2020 - with Sally Duby - The Bridge Group

**Ray Rike** (0:00)
Hello, I'm Ray Wright, Founder and CEO of RevOp Squared, and host of the Metrics that Measure Up podcast. We talked to a wide variety of B2B SaaS industry thought leaders, executives, and people just like you to discuss what metrics, KPIs, and benchmarks they use to enable better data-driven metrics-informed decisions that accelerate revenue performance and increase enterprise value. Now, on to today's show. Welcome to today's episode of the Metrics That Measure Up podcast. Today, we are joined by Sally Duby, Partner and Chief Sales Officer at The Bridge Group. Today, we will be discussing the insights and trends that were discovered during The Bridge Group's latest 2020 B2B Sales Compensation Survey. We will be covering the following areas. CRO, Senior Vice President, Vice President of Sales, Compensation, Benchmarks and Trends, Field Sales, Account Executive, Sales Compensation, Benchmarks and Trends, Insight Sales Compensation, Sales Development Compensation, and Sales Operations and Sales Enablement, Compensation, Benchmarks and Trends. Sally, please take a minute to introduce yourself in The Bridge Group to our listeners.

**Sally Duby** (1:20)
Thanks so much, Ray. I really appreciate being here. I am CSO of The Bridge Group. The Bridge Group is a consulting firm that specializes in sales development and in insight sales for B2B software and SaaS companies. In 22 years, we've been in business and we do a lot of these compensation and metrics surveys for probably the last 12 years now. So we're really steep in that market and segmentation.

**Ray Rike** (1:49)
I know, Sally, when I was leading go-to-market teams, marketing, sales and customer success, I always looked forward to The Bridge Group's compensation research probably for 10 years now. But we're in a different time than all those previous years. This is still emerging from COVID. And some of the benchmarks that RevOp Squared collected over the last six months include the fact that ARR growth is down almost 50% against the first F20 plan. In fact, new name customer ARR is down even more. And over 80% of B2B SaaS companies have reduced operating expenses. And the number one function being impacted by those expense controls is sales, with 35% of the expense controls coming out of the sales group. The next closest is research and development and customer success is about 15%.
So times have changed. So let's go into the first topic we're going to discuss. And that is how is compensation for chief revenue officers and really kind of SVPs of sales change? And I know this is always a very passionate discussion that CFOs and CEOs have with their heads of sales.

**Sally Duby** (2:55)
Yes, it is. Compensation is a huge discussion, especially now. And so, you know, I think some of the changes that we saw in our survey that we just did. And let me say that the survey that we just did was a really quick snapshot of all the roles that you had mentioned, with a particular focus on the Bay Area, because it was done in conjunction with the VPS Sales Forum group that I co-founded 12 years ago, which is really focused on the Bay Area and California. And so, what we saw on the CRO side of things, Ray, was that the timing of the variable comp payments is really starting to switch. CROs, head of sales, used to get paid quarterly, for the most part, and that has really turned and switched to more companies are paying that variable comp out on a monthly basis for CROs, which is kind of interesting. And the fact that we saw a huge jump in equity increase, that it went up about 60% from two years ago, when we did this survey in the Bay Area.

**Ray Rike** (4:04)
Well, let's drill down into a couple of those things, because I know one of the things I love about your research is that you really segment the companies that you surveyed to by size, including both ARR size, but also by average contract value. And you mentioned monthly payments. I saw that going up to, I think you said 54% are now monthly. What do you think is driving that trend to paying the top of sales, CRO, on a monthly basis over 50% of the time?

**Sally Duby** (4:33)
You know, I think that these are sort of some guesstimates on my part, but it does make sense in that you see that's the same type of payments on incentive comp that we see for field sales, close AE and inside sales and SDRs. So it makes sense to do the alignment so that you've got your CROs, head of sales, are equally driven to drive that monthly cadence of closing business instead of quarterly or even annual. And that does make a difference. When you change those behaviors and you get that monthly payout, you can be much more focused on a monthly cadence of driving business versus a quarterly or even an annual basis. What do you think, Ray?