Sales Management

Planning,

direction and control of personal selling/ sales force; and includes:

Recruiting

and selecting Equipping, assigning and routing Supervising Paying and motivating

Sales Management
Objectives:
Make

major contribution to:

Sales volume Contribution to profits Continuing growth

Top

management delegates the above objectives to marketing management, which then delegates to sales management

Sales Management
Sales

management is responsible for controlling sales expenses (cost of sales) in such a way that the profits are optimized Sales executives have responsibility for coordination involving:
Organization Planning Other

elements in marketing strategy

Sales Management
Sales

management and Control:

Situation

analysis Setting quantitative performance standards Gathering and processing actual performance data Evaluating performance Action to correct controllable variation Adjusting for uncontrollable variation

Sales Management
Types

of sales control

Informal Formal

with written sales policies Policy formulation and review Formal control over sales volume Budgetary control

Personal Selling
Buyer
Two

-Seller Dyads

person interactions Influenced by: Personal characteristics Role requirements Develops a personal affiliation Adjustments of needs and expectations during negotiations

Personal Selling Situations

Group

A: Services selling Group B: Developmental Selling Group C: Creative Selling

Personal Selling Situations

Group

A: Services selling: Inside order taker Delivery sales person Route or merchandising person Missionary Technical sales person

Personal Selling Situations

Group

B: Developmental selling Creative salesperson of tangibles Creative salesperson of intangibles Group C: requiring 'unusual' creativity 'Political', 'Indirect', or 'back-door' salesperson Salesperson engaged in multiple sales

Theories of Selling
AIDAS Right

Set of Circumstances Buying Formula Behavioural Equation

AIDAS Theory of Selling

Securing

Attention Gaining Interest Kindling Desire Inducing Actions Building Satisfaction

Right set of Circumstances Theory of Selling

External

factors induced to influence decisions (Lets go out for a cup of coffee) Sometimes to cover up internal factors or where difficult to manipulate internal factors Is a seller oriented theory

Buying Formula Theory

Emphasizes

buyer's side of buyer-seller dyad Buyers' needs receive major attention

Adequacy Need or problem Product/Service Trade name (Solution) Pleasant feelings Purchase Satisfaction

Behavioural Equation Theory (J.A. Howard)

B

=PxDxKxV B: act of purchasing a Brand or patronizing a supplier P: Predisposition or force of habit D: present Drive level (amount of motivation) K: 'Incentive potential' or potential satisfaction V: intensity of all cues: triggering, product or informational

Behavioural Equation Theory (J.A. Howard)

Buyer-seller

dyad and reinforcement Salesperson's influence process Salesperson's role in reducing buyer dissonance Four possible situations:
Established

/ New product Ongoing / New salesperson

Selling Process
Prospecting Sales

resistance (Customer objections) Closing sales

Selling Process
Prospecting
Formulating

prospect definition Searching out potential accounts Qualifying prospects

Determine

probable requirement

Relating

company products to each prospect's

needs

Selling Process
Sales

Resistance (Customer objections)

to sales

Obstacles
Can

be real or unreal Cash shortage

Sales
Can

objections

be sincere or insincere Incomplete or vague offers Appropriateness of product

Selling Process
Closing

Sales

Low-pressure

sales are closed more easily than high-pressure sales Move the prospect from high-pressure to low pressure situation by removing obstacles and objections Provide more reasons for purchase than to negate First try for 'indirect close', get order without actually asking for it; otherwise directly ask

Personal Selling Objectives

Qualitative:
Service

existing accounts Obtain new customers Secure and maintain customers' cooperation Keep customers informed of changes Missionary selling Provide technical assistance and advice Provide management advice/assistance to middlemen and train their salespersons Collect market information for use by corporate

Personal Selling Objectives

Quantitative:
Capture

and retain a certain market share Obtain sales volume in such ways to achieve profit objectives (by selling optimum mix of products) Obtain new accounts of given types Keep personal-selling expenses within set limits Secure targeted percentages of specific customer accounts

Forecasting Process

Identifying forecasting objectives

Short-range (3 to 6 months); Mid-range (1 to 2 years) and Long-range (>2 years) General economy forecast Industry sales forecast Company sales forecast Sales forecast for the product lines Individual product forecasts by SKU

Forecasting Process

Determining independent and dependent variables Developing forecasting procedure Select forecast analysis method

Sales Forecasting Methods

Qualitative:

Experts opinion Delphi Method Survey of buyers expectation Sales force composite method Historical analogy method for new products

Sales Forecasting Methods

Quantitative:

Test marketing Time series analysis Market Factor Indices Method

Based on differential geographic buying powers Useful when there is mutual interdependence between the variables

Econometric techniques

Time Series Analysis

Nave or simple method based on rate of change of sales of previous periods Free hand or Graphic method Method of semi averages Method of moving averages Method of least square Using seasonality index (Decomposition method) Exponential smoothing method Correlation analysis Regression analysis

Sales-Related Marketing Policies

Product

policies:
line policy

Product

Product

offerings Line simplification Line diversification Ideas for new products Appraisal for new products
Product

design policy Product quality and service policy

Sales-Related Marketing Policies

Distribution
Policies
Sales

policies:

on marketing channels:

volume potential Comparative distribution costs Net profit opportunities

Policies
Mass

on distribution intensity:

distribution Selective distribution Exclusive agency distribution

Sales-Related Marketing Policies

Pricing
Policy Policy
Full

policies:
on pricing relative to competition
/ Under / Above competition

Meet

on pricing relative to costs

cost Promotional Contributive

Policy

on uniformity of prices to different buyers

One-price

policy Negotiable price depending on business volume

Sales-Related Marketing Policies

Pricing
Policy

policies:

on list pricing Policy on discounts

Trade

discounts Quantity discounts

Geographical
FOB Delivered

pricing policy

pricing

Product

line pricing policy Policy on price leadership Competitive bidding policy