Professional Documents
Culture Documents
Distribution
Managemen
t
Objective of sales
management
• Marketing function splits into sales and
other functions like market research,
advertising, physical distribution
• Sales Management: “The process of
planning, directing, and controlling of
personal selling, including recruiting,
selecting, equipping, assigning,
supervising, paying, and motivating the
personal sales force.”
Nature of Sales
Management
• Its integration with marketing management
Head-
Marketing
• Relationship Selling
• Order taker (Response selling) • Inside order taker • Behind counter in a garment shop
• Pharma products’ orders from
• Telemarketing salesperson takesnursing homes
orders over telephone • Food, clothing products’ orders
• Outside order taker. Also performsfrom retailers
other tasks
• Order-getter (Creative, Problem-• Getting orders from existing and• Automobiles, refrigerators,
solving, Consultative selling) new household consumers insurance policies
• Getting orders from business• Software and business solutions
customers, by solving their business
and technology problems
Importance of Personal Selling
and Sales Management
• The only function / department in a
company that generates revenue / income
• The financial results of a firm depend on
the performance of the sales department /
management
• Many salespeople are among the best paid
people in business
• It is one of the fastest and surest routes to
the top management
Roles and Skills of a Modern Sales
Manager
Some of the important roles of the modern
sales manager are:
• A member of the strategic management team
• A member of the corporate team to achieve
objectives
• A team leader, working with salespeople
• Managing multiple sales / marketing channels
• Using latest technologies (like CRM) to build
superior buyer-seller relationships
• Continually updating information on changes in
marketing environment
Skills of a Successful Sales
Manager
• People skills include abilities to motivate,
lead, communicate, coordinate, team-
oriented relationship, and mentoring
• Managing skills consist of planning,
organizing, controlling and decision
making
• Technical skills include training, selling,
negotiating, problem-solving, and use of
computers
Types of Sales Managers / Levels
of Sales Management Positions
CEO /
President
District / Branch / Area Sales Managers First / Lower Level Sales Managers
• Increase sales • Enter export• Identify the countries • Marketing / sales head to get
volume by 15 markets relevant information
percent • Decide distribution channels • Negotiate and sign agreements
in 3-5 months with
intermediaries
• Strategy for handling customer • Prompt action at the customer interface level
complaints • If the problem persists, involve senior sales and
service people
Psychology in
Selling
• If a sales person makes a presentation, the
prospect may or may not buy
• The above “buyer behaviour model” does not
tell us the reasons of buying or not buying
• To understand the psychological aspects of
selling or buying, salespeople should study
consumer or buyer behaviour, including buying
process and situations
Buying Process of Consumers and Business
Buyers
Five – stage model for household Eight – stage model for business
customers buyers
1. Problem / need recognition 1. Problem / need recognition
2. Characteristics and quantity
determination
3. Specification development
2. Information search / collection 4. Supplier search and qualification
5. Obtain and analyse supplier
proposals
3. Evaluate alternatives 6. Evaluation and selection of suppliers
Qualifying
• Companies qualify sales leads by contacting them by mail or
phone to find their interests (or needs) and financial capacity.
• Leads are categorized as: Hot, Warm, and Cool
Preapproa
ch
• Information gathering about the
prospect.
Sources of information: the Internet,
industrial directories, government
publications, intermediaries, etc.
• Precall planning
• Setting call objectives
• Tentative planning of sales strategy: which
products, features and benefits may meet
the customer needs
Approac
h
• Make an appointment to meet the prospect
• Make favourable first impression
• Select an approach technique:
• Introductory
• Customer benefit
• Product
• Question
• Praise
• The approach takes a few minutes of a
call, but it can make or break a sale
Presentation and
Demonstration
There are four components:
• Understanding the buyer’s needs
• Knowing sales presentation methods /
strategies
• Developing an effective presentation
• Using demonstration as a tool for selling
We will examine each of the above points
Understanding the buyer’s
needs
• Firms and consumers buy products / services to
satisfy needs
• To understand buyer’s needs, ask questions and listen
• In business situations, problem identification and
impact questions are important
E.G.
• Have you experienced any problems on quality and
delivery from the existing supplies?
• What impact the quality and delivery problems will
have on your costs and customer satisfaction?
Knowing Sales Presentation
Methods/Strategies
Firms have developed different methods / styles / strategies of
sales presentation
• Stimulus response method / canned approach.
• It is a memorised sales talk or a prepared sales
presentation.
• The sales person talks without knowing the prospect’s
needs. E.G. Used by tele-marketing people
• Formula method / formulated approach.
• It is also based on stimulus response thinking that all
prospects are similar.
• The salesperson uses a standard formula – AIDA
(attention, interest, desire, and action).
• It is used if time is short and prospects are similar.
• Shortcomings are: prospects’ needs are not uncovered
and uses same standard formula for different prospects.
Sales Presentation Methods
(Continued)
• Need – satisfaction method
• Interactive sales presentation
• First find prospect’s needs, by asking
questions and listening
• Use FAB approach: Features, Advantages,
Benefits
• Effective method, as it focuses on customers
• Consultative selling method / Problem-
solving approach
• Salespeople use cross-functional expertise
• Firms adopt team selling approach
• It is used by software / consulting firms
Developing an Effective
Presentation
Some of the guidelines are:
• Plan the sales call
• Adopt presentation to the situation and person
• Communicate the benefits of the purchase
• Present relevant and limited information at a
time
• Use the prospect’s language
• Make the presentation convincing – give
evidence
• Use technology like multi-media presentation
Using
Demonstration
• Sales presentation can be improved by
demonstration
• Demonstration is one of the important selling tools
EGs: Test drive of cars; demonstration of
industrial products in use
• Benefits of using demonstration for selling are:
• Buyers’ objections are cleared
• Improves the buyer’s purchasing interest
• Helps to find specific benefits of the prospect
• The prospect can experience the benefit
Overcoming Sales Objections /
Resistances
• Objections take place during presentations
/ when the order is asked
• Two types of sales objections:
• Psychological / hidden
• Logical (real or practical)
• Methods for handling and overcoming
objections: (a) ask questions, (b) turn an
objection into a benefit, (c) deny
objections tactfully, (d) third-party
certificate, (e) compensation
Trial close and Closing
the sale
• Trial close checks the attitude or opinion of
the prospect, before closing the sale (or
asking for the order)
• If the response to trial close question is
favourable, then the salesperson should close
the sale
• Some of the techniques used for closing
the sale are: (a) alternative-choice, (b) minor
points, (c) assumptive, (d) summary-of-
benefits, (e) T-account, (f) special-offer, (g)
probability, and (h) negotiation
Follow-up and
Service
• Necessary for customer satisfaction
• Successful salespeople follow-up in different ways:
For example,
• Check order details
• Follow through delivery schedule
• Visit when the product is delivered
• Build long-term relationship
• Arrange warranty service
Negotiati
on
• Salespeople, particularly in business to business
selling, need negotiating skills
• When to negotiate?
(a) When the buyer puts certain conditions for buying
to the seller, (b) When agreement between the buyer
and the seller is needed on several factors, (c) When
the product is customised, (d) When the final price is
to be decided
• How to prepare for negotiation?
(a) planning, (b) building relationship, (c) purpose
• Styles of negotiation
(a) I win, you lose, (b) Both of us win (or win-win
style), (c) You win, I lose, and (d) Both of us lose
Size of Sales Force
• Needed to increase effectiveness of sales force
• Done by expanding basic sales organization
• Basis of specialization
• Geography
• Type of product
• Market
• Combination of above
• Criteria for selection – (1) nature of product, (2) sales
force abilities, (3) demands of selling job, (4)
customer and market facts
Geographic
Specialisation
Head-Marketing
Head-Marketing
Salespeople – Salespeople –
Product Gr. ‘A’ Product Gr. ‘B’
Area Sales
Managers
Salespeople
Fig. ‘y’ Sales Organisation with Product Managers as Staff
Specialists
In fig. ‘x’: Characteristics: Salespeople in each product group sell only the
products in that group
Advantage: Each product gets specialised attention from the salesforce
Disadvantage: Sometimes, more salespeople contact the same customer,
resulting in customer dissatisfaction and higher cost
In fig. ‘y’: Characteristics: Each product manager plans and implements
marketing plan, for a product group
Advantage: Corrects the problem of duplication calls on a customer by
salespeople
Disadvantage: Lack of product specialisation by salespeople
Market
Specialisation
General Sales
Manager
Area Sales Mgrs Area Sales Manager- Area Sales Manager- Area Sales Mgrs-
International Commercial Government Consumer Markets
Physical Examination
• Objective is to find a physical problem that may prevent job
performance of an applicant
• Most companies want their prospective employees to
undergo physical examination
• Increasing number of firms ask applicant to complete the
health information form without seeing a medical doctor
Hiring Stage
• After completing selection process, a list of candidates
to be hired is made
• In hiring stage, two activities are performed:
(1) The company making the job offer
(2) Persuading the applicant to accept it
Socialisation Stage
• It is the process through which new salespeople learn
values, norms, attitudes, and behaviour of people
working in the firm
• Socialisation process starts before the new salesperson
accepts the job offer and continues until the person is
assimilated into the company culture
• Assimilation is the second stage of socialisation process
• Companies have this process, in order to retain new
salespeople
Compensation and Motivation of
Motivational
Sales Force
Theories
• Motivational theories or behavioural concepts that are
relevant to motivation of salespeople are:
• Maslow’s hierarchy of needs
• Hertzberg’s dual-factor
• Vroom’s expectancy
• Churchill, Ford, and Walker model of salesforce
motivation, shown hereunder:
Base C
(B) 1 B
B
C C C C
5 4 3 2
Sales Analysis
Productivity Analysis