Terms

On Target Earnings

What are On Target Earnings?

On Target Earnings (OTE) is a compensation model used in sales roles, combining a fixed base salary with variable income based on performance. It serves as a motivational benchmark for sales representatives, aligning various departments around financial objectives and setting realistic expectations for both employers and employees.

Calculating On Target Earnings

To calculate OTE, add the base salary to the potential maximum commission that an employee can earn upon achieving their sales targets. OTE can be structured as either capped, where there is a limit on the commission earnings, or uncapped, which allows for limitless earnings based on performance.

Factors Influencing On Target Earnings

Various factors can influence the calculation and effectiveness of OTE:

  • Pay Mix: The ratio of base salary to commission can affect motivation and income stability.
  • Market Factors: Geographic location and industry-specific demands can dictate the baseline of OTE.
  • Sales Complexity: The complexity of the product and length of the sales cycle can adjust OTE expectations.
  • Employee Experience: More experienced salespeople might command a higher base salary component.
  • Economic Conditions: Broader economic factors can influence the competitiveness of OTE packages.

On Target Earnings Vs. Base Salary

On Target Earnings (OTE) and base salary are two distinct components of a salesperson's compensation. While base salary is a fixed income guaranteed regardless of performance, OTE represents the total expected pay, combining base salary with variable income such as commissions earned by meeting performance quotas. OTE serves as a motivational tool, incentivizing high performance and aligning departments around financial objectives.

OTE models can have both pros and cons. On the positive side, they provide a benchmark for sales managers, serve as an effective recruiting tool, and help align departments around revenue and expenses. However, potential downsides include the possibility of inflated OTE numbers leading to unrealistic expectations and the need for employers to commit to the OTE figures presented to candidates.

Achieving Beyond On Target Earnings

For sales professionals aiming to exceed their OTE, the following strategies are crucial:

  • Skill Development: Continuously improving sales skills and product knowledge to stay competitive.
  • Strategic Selling: Prioritizing high-value clients and effectively managing time to maximize sales outcomes.
  • Networking: Building and maintaining strong relationships that can lead to new opportunities and referrals.
  • Performance Feedback: Regularly seeking and acting on feedback to enhance sales techniques and strategies.

Other terms

Oops! Something went wrong while submitting the form.
00 items

DevOps

Learn about DevOps, including understanding DevOps principles, benefits of adopting DevOps, DevOps vs traditional IT, & key components of DevOps.

DevOps

BAB Formula

Learn about BAB formula, including implementing BAB in sales strategies, crafting an effective BAB pitch, & comparing BAB with other sales frameworks.

BAB Formula

Headless CMS

Learn about headless CMS, including benefits of using a headless CMS, how a headless CMS works, & headless CMS vs. traditional CMS.

Headless CMS

Product-Market Fit

Learn about product-market fit, including identifying product-market fit, key metrics for product-market fit, & strategies to achieve product-market fit.

Product-Market Fit

Statement of Work

Learn about statement of work, including key components of a statement of work, & crafting an effective statement of work.

Statement of Work

Lead Generation Tactics

Learn about lead generation tactics, including strategies for successful lead generation, & key components of effective lead generation.

Lead Generation Tactics

Sales Enablement Content

Learn about sales enablement content, including crafting compelling sales enablement content, & essential components of effective sales content.

Sales Enablement Content

Average Customer Life

Learn about average customer life, including calculating average customer life, key factors influencing customer life, & improving average customer life.

Average Customer Life

Dynamic Segment

Learn about dynamic segment, including benefits of using dynamic segments, crafting effective dynamic segments, & dynamic segments vs. static segments.

Dynamic Segment

Social Selling

Learn about social selling, including benefits of social selling, steps to implement social selling, & social selling vs. traditional selling.

Social Selling

Marketing Analytics

Learn about marketing analytics, including key benefits of marketing analytics, & strategies for effective marketing analytics.

Marketing Analytics

Video Messaging

Learn about video messaging, including benefits of video messaging in sales, crafting engaging video messages, & video messaging vs. traditional email.

Video Messaging

Consumer Buying Behavior

Learn about consumer buying behavior, including understanding consumer decision processes, & the impact of culture on buying habits.

Consumer Buying Behavior

Persona

Learn about persona, including different types of personas, creating a user persona, benefits of using personas, & persona development process.

Persona

AI Sales Script Generator

Learn about AI sales script generator, including benefits of AI sales script generators, & crafting the perfect AI-generated sales script.

AI Sales Script Generator

Stakeholder

Learn about stakeholder, including identifying stakeholders, roles & responsibilities of stakeholders, & stakeholder engagement strategies.

Stakeholder

Marketing Qualified Opportunity

Learn about marketing qualified opportunity, including identifying marketing qualified opportunities, & key elements of successful identification.

Marketing Qualified Opportunity

Marketing Operations

Learn about marketing operations, including key elements of marketing operations, & the role of technology in marketing operations.

Marketing Operations

Customer Experience

Learn about customer experience, including understanding customer needs, designing user-friendly products, & enhancing customer support.

Customer Experience

Contract Management

Learn about contract management, including key principles of effective contract management, & steps to streamline your contracting process.

Contract Management

Dynamic Territories

Learn about dynamic territories, including benefits of dynamic territories, & implementing dynamic territories effectively.

Dynamic Territories

Sales Forecast Accuracy

Learn about sales forecast accuracy, including improving sales forecast accuracy, & factors influencing forecast precision.

Sales Forecast Accuracy

Salesforce Administrator

Learn about salesforce administrator, including the role of a salesforce administrator, & key responsibilities of salesforce administrators.

Salesforce Administrator

B2C2B

Learn about B2C2B, including how B2C2B transforms sales, key strategies for B2C2B success, & differences between B2C2B and B2B2C.

B2C2B

Sales and Marketing Analytics

Learn about sales and marketing analytics, including key benefits of sales and marketing analytics, & implementing analytics successfully.

Sales and Marketing Analytics

Demand Capture

Learn about demand capture, including strategies for effective demand capture, key principles of demand capture, & demand capture vs. demand generation.

Demand Capture

Canary Releases

Learn about canary releases, including introduction, benefits of canary releases, steps to implement, & challenges and solutions.

Canary Releases

Voice Search Optimization

Learn about voice search optimization, including how to implement voice search optimization, & benefits of voice search optimization.

Voice Search Optimization

Buying Committee

Learn about buying committee, including identifying key members of a buying committee, & strategies for engaging a buying committee.

Buying Committee

Warm Outbound

Learn about warm outbound, including understanding warm outbound, benefits of warm outbound strategies, & implementing warm outbound in your sales process.

Warm Outbound

Channel Partners

Learn about channel partners, including how channel partners benefit your business , & choosing the right channel partners .

Channel Partners

Persona Map

Learn about persona map, including building an effective persona map, key elements of a persona map, persona map vs. target market.

Persona Map

Sales Enablement Platform

Learn about sales enablement platform, including key features of sales enablement platforms, & selecting the right sales enablement platform.

Sales Enablement Platform

MEDDICC

Learn about MEDDICC, including implementing MEDDICC effectively, key elements of MEDDICC, & MEDDICC versus traditional sales models.

MEDDICC

Retargeting Marketing

Learn about retargeting marketing, including the foundations of a successful retargeting campaign, & strategies for effective retargeting.

Retargeting Marketing

Cold Email

Learn about cold email, including crafting an effective cold email, key elements of a cold email, & cold email vs. warm email: understanding the difference.

Cold Email

Click-Through Rate

Learn about click-through rate, including maximizing click-through rates: strategies and tips, & measuring click-through rate effectiveness.

Click-Through Rate

Cold Call

Learn about cold call, including mastering cold call techniques, optimizing success in cold calls, & comparing cold calls and warm calls.

Cold Call

Account Development Representative

Learn about account development representative, including key responsibilities of an account development representative.

Account Development Representative

Unique Value Proposition (UVP)

Learn about unique value proposition (UVP), including its definition, key components, how to create one, benefits, and examples of effective UVPs.

Unique Value Proposition (UVP)

Sales Development Representative (SDR)

Learn about sales development representative, including roles and responsibilities of an SDR, key skills for successful SDRs, and pathways to becoming an SDR.

Sales Development Representative (SDR)

Territory Management

Learn about territory management, including strategies for effective territory management, & best practices in territory management.

Territory Management

Performance Monitoring

Learn about performance monitoring, including benefits of performance monitoring, key metrics to track, common challenges, & best practices.

Performance Monitoring

Account-Based Selling

Learn about account-based selling, including key principles of account-based selling, effective account-based selling strategies, benefits of implementing account-based selling.

Account-Based Selling

Elevator Pitch

Learn about elevator pitch, including crafting an effective elevator pitch, key components of a strong elevator pitch, & elevator pitch dos and don'ts.

Elevator Pitch

Letter of Intent

Learn about letter of intent, including understanding the letter of intent (LOI), essential components of a LOI, LOI in academic and professional applications.

Letter of Intent

Load Balancing

Learn about load balancing, including how load balancing works, benefits of load balancing, load balancing techniques, & challenges in load balancing.

Load Balancing

BANT Framework

Learn about BANT framework, including implementing BANT in sales strategy, advantages of the BANT methodology, & BANT vs. other qualification models.

BANT Framework

Brand Equity

Learn about brand equity, including understanding its importance, building strong brand equity, measuring brand equity, & real-world applications.

Brand Equity

Integration Testing

Learn about integration testing, including benefits of integration testing, best practices, challenges and solutions, & tools and resources.

Integration Testing

Annual Recurring Revenue (ARR)

Learn about ARR, including understanding ARR and MRR, the differences between them, how they relate to growth and calculation methods.

Annual Recurring Revenue (ARR)

Brag Book

Learn about brag book, including crafting your outstanding brag book, essential components of a brag book, & brag book vs. resume: unveiling the differences.

Brag Book

80/20 Rule

Learn about the 80/20 Rule, including applying the 80/20 rule in sales, maximizing efficiency with 80/20, & 80/20 rule versus traditional methods.

80/20 Rule

Economic Order Quantity

Learn about economic order quantity, including calculating economic order quantity, & benefits of optimizing order quantity.

Economic Order Quantity

Predictive Analytics

Learn about predictive analytics, including key benefits of predictive analytics, & implementing predictive analytics successfully.

Predictive Analytics

Average Selling Price

Learn about average selling price, including calculating average selling price, & influencing factors on average selling price.

Average Selling Price

Lead Magnet

Learn about lead magnet, including crafting an irresistible lead magnet, characteristics of effective lead magnets, & lead magnets vs. traditional advertising.

Lead Magnet

Pay-per-Click (PPC)

Learn about PPC, including crafting effective PPC ad campaigns, key benefits of PPC advertising, comparing PPC with organic search, and optimizing your PPC strategy.

Pay-per-Click (PPC)

Account Match Rate

Learn about account match rate, including improving your account match rate, key factors influencing account match rate, & account match rate vs. data quality.

Account Match Rate

Dark Social

Learn about dark social, including the challenges of tracking dark social, strategies for leveraging dark social, & dark social vs. public social channels.

Dark Social

DMP

Learn about DMP, including understanding DMP functionality, benefits of using a DMP, choosing the right DMP, & key features of DMPs.

DMP

Payment Gateways

Learn about payment gateways, including how payment gateways work, benefits of payment gateways, & challenges of implementing payment gateways.

Payment Gateways

Net 30

Learn about Net 30, including advantages of utilizing Net 30, implementing Net 30 in your business, & Net 30 vs. immediate payment terms.

Net 30

Account-Based Analytics

Learn about account-based analytics, including implementing account-based analytics, & key metrics for account-based analytics.

Account-Based Analytics

Dark Funnel

Learn about dark funnel, including unraveling the dark funnel mystery, strategies to illuminate the dark funnel, & dark funnel vs. traditional sales funnels.

Dark Funnel

Data Enrichment

Learn about data enrichment, including benefits of data enrichment, techniques for effective data enrichment, & data enrichment vs. data cleansing.

Data Enrichment

Competitive Intelligence (CI)

Learn about CI, including its key benefits, how to gather and analyze CI data, and tools and tech for it.

Competitive Intelligence (CI)

Email Cadence

Learn about email cadence, including crafting an effective email cadence, key components of email cadence, & email cadence vs. email blast differences.

Email Cadence

Enterprise Resource Planning

Learn about enterprise resource planning, including benefits of implementing ERP, key components of ERP systems, & ERP versus traditional software.

Enterprise Resource Planning

Lead Routing

Learn about lead routing, including benefits of effective lead routing, key steps in implementing lead routing, lead routing vs. lead scoring: understanding the differences.

Lead Routing

Value-Added Reseller

Learn about value-added reseller, including key benefits for businesses, successful value-added reseller examples, value-added reseller vs. traditional reseller.

Value-Added Reseller

Business-to-Business (B2B)

Learn about B2B, including what is it, its key elements, the benefits of B2B partnerships, the differences between B2B and B2C, and strategies for effective marketing.

Business-to-Business (B2B)

Mobile App Analytics

Learn about mobile app analytics, including how mobile app analytics works, benefits of mobile app analytics, & tools for mobile app analytics.

Mobile App Analytics

Intent leads

Learn about intent leads, including identifying intent leads in sales, strategies for nurturing intent leads, & comparing intent leads and cold leads.

Intent leads

Robotic Process Automation

Learn about robotic process automation, including benefits of robotic process automation, & implementing RPA in outbound sales.

Robotic Process Automation

Revenue Forecasting

Learn about revenue forecasting, including key elements of revenue forecasting, & steps to accurate revenue forecasting.

Revenue Forecasting

Demographic Segmentation in Marketing

Learn about demographic segmentation in marketing, including understanding demographic variables, & implementing demographic segmentation.

Demographic Segmentation in Marketing

Value Chain

Learn about value chain, including key elements of value chain, building an efficient value chain, & value chain vs. supply chain.

Value Chain

Firmographics

Learn about firmographics, including understanding firmographic data, key elements of firmographics, & utilizing firmographics for market segmentation.

Firmographics

Objection Handling

Learn about objection handling, including strategies for effective objection handling, & common objections in sales and responses.

Objection Handling

Upsell

Learn about upsell, including benefits of effective upselling, strategies for successful upselling, & upsell vs. cross-sell: understanding the difference.

Upsell

Psychographics

Learn about psychographics in marketing, including understanding it, crafting psychographic profiles, & psychographics vs. demographics.

Psychographics

Tire-Kicker

Learn about tire-kicker, including identifying tire-kickers in sales, strategies to engage tire-kickers, & converting tire-kickers to buyers.

Tire-Kicker

Process Builder

Learn about process builder, including how process builder works, benefits of using process builder, & best practices for process builder.

Process Builder

Event Marketing

Learn about event marketing, including planning successful event marketing strategies, & key elements of event marketing.

Event Marketing

Field Sales Rep

Learn about field sales rep, including key responsibilities of a field sales rep, & qualities of a successful field sales rep.

Field Sales Rep

GDPR Compliance

Learn about GDPR compliance, including understanding GDPR requirements, steps to achieve compliance, & common pitfalls and solutions.

GDPR Compliance

Predictive Lead Scoring

Learn about predictive lead scoring, including benefits of predictive lead scoring, & implementing predictive lead scoring successfully.

Predictive Lead Scoring

Single Sign-On (SSO)

Learn about single sign on, including benefits of single sign-on, implementation steps for single sign-on, & comparing SSO with traditional login systems.

Single Sign-On (SSO)

Video Selling

Learn about video selling, including benefits of video selling, effective video selling strategies, & video selling vs. traditional selling.

Video Selling

Sales Coach

Learn about sales coach, including qualities of an effective sales coach, the importance of sales coaching, & sales coaching vs. sales managing.

Sales Coach

Email Engagement

Learn about email engagement, including maximizing email engagement rates, strategies for crafting compelling emails, analyzing email engagement: metrics.

Email Engagement

Business Continuity

Learn about business continuity, including understanding key components, steps to ensure continuity, common challenges, & best practices.

Business Continuity

Clustering

Learn about clustering, including how clustering enhances outbound sales, key benefits of clustering, & types of clustering methods.

Clustering

Quality Assurance

Learn about QA, including understanding QA in outbound sales, benefits of implementing QA, best practices for QA, and tools for effective QA.

Quality Assurance

A/B Testing

Learn about A/B testing, including benefits of A/B testing, planning your A/B test strategy, analyzing A/B testing results, & A/B testing best practices.

A/B Testing

Dynamic Data

Learn about dynamic data, including benefits of leveraging dynamic data, key components of dynamic data, & dynamic data vs. static data: unveiling the differences.

Dynamic Data

B2B Demand Generation Strategy

Learn about B2B demand generation strategy, including key elements of demand generation, & crafting your demand generation plan.

B2B Demand Generation Strategy

Touchpoints

Learn about touchpoints, including maximizing touchpoint efficacy, types of sales touchpoints, & optimizing customer journey through touchpoints.

Touchpoints

Database Management

Learn about database management, including key principles of efficient database management, & building a robust database architecture.

Database Management
Clay brand asset shaped as a 3D group of abstract objects made out of purple and pink clayClay brand asset shaped as a 3D group of abstract objects made out of purple and pink clay

Scale your outbound motion in seconds, not months

14 day free Pro trial - No credit card required

Try Clay free