Chapter 16
Chapter 16
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They represent the company to customers. They find and develop new customers and
communicate information about the company’s products and services.
They represent customers to the company. They relay customer concerns about
company products and actions to the company.
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It can increase communications between the two groups by arranging joint meetings
and spelling out communication channels.
It can create opportunities for salespeople and marketers to work together. Brand
managers and researchers can tag along on sales calls or sit in on sales planning
sessions. In turn, salespeople can sit in on marketing planning sessions and share their
firsthand customer knowledge.
It can create joint objectives and reward systems for sales and marketing teams or
appoint marketing–sales liaisons—people who help coordinate marketing and sales
force programs and efforts.
It can appoint a high-level marketing executive to oversee both marketing and sales.
Such a person can help infuse marketing and sales with the common goal of creating
value for customers to capture value in return.
2. Managing the Sales Force
Sales force management: Analyzing, planning, implementing, and controlling sales force
activities.
The major steps in sales force management:
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Territorial sales force structure: A sales force organization that assigns each salesperson
to an exclusive geographic territory in which that salesperson sells the company’s full
line. This organization clearly defines each salesperson’s job and fixes accountability. It
also increases the salesperson’s desire to build local customer relationships that, in turn,
improve selling effectiveness. Finally, because each salesperson travels within a limited
geographic area, travel expenses are relatively small.
Product sales force structure: A sales force organization in which salespeople specialize
in selling only a portion of the company’s products or lines.
Customer (or market) sales force structure: A sales force organization in which
salespeople specialize in selling only to certain customers or industries. Separate sales
forces may be set up for different industries, serving current customers versus finding
new ones, and serving major accounts versus regular accounts. Organizing the sales
force around customers can help a company build closer relationships with important
customers. Many companies even have special sales forces to handle the needs of
individual large customers.
When a company sells a wide variety of products to many types of customers over a
broad geographic area, it often employs a complex sales force structure, which
combines several types of organization. Salespeople can be specialized by customer and
territory; product and territory; product and customer; or territory, product, and
customer.
2.1.2 Sales Force Size
Sales forces may range in size from only a few salespeople to tens of thousands.
A company might use some form of workload approach to set sales force size. Using this
approach, a company first groups accounts into different classes according to size, account
status, or other factors related to the amount of effort required to maintain the account. It then
determines the number of salespeople needed to call on each class of accounts the desired
number of times.
2.1.3 Other Sales Force Strategy and Structure Issues
Sales management must also determine who will be involved in the selling effort and how
various sales and sales-support people will work together.
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training and internet-based sales exercises that build sales skills to sophisticated simulations
that re-create the dynamics of real-life sales calls. One of the most basic forms is virtual
instructor-led training (VILT). Using this method, a small group of salespeople at remote
locations logs on to an online conferencing site, where a sales instructor leads training sessions
using online video, audio, and interactive learning tools.
2.4 Compensating Salespeople
To attract good salespeople, a company must have an appealing compensation plan.
Compensation consists of four elements: a fixed amount, a variable amount, expenses, and
fringe benefits.
Fixed amount, usually a salary, gives the salesperson some stable income.
Variable amount, which might be commissions or bonuses based on sales performance,
rewards the salesperson for greater effort and success.
A sales force compensation plan can both motivate salespeople and direct their activities.
Compensation should direct salespeople toward activities that are consistent with the overall
sales force and marketing objectives.
Straight salary, straight commission, salary+ bonus, salary + commission
2.5 Supervising and Motivating Salespeople
New salespeople also need supervision and motivation. The goal of supervision is to help
salespeople “work smart” by doing the right things in the right ways. The goal of motivation is
to encourage salespeople to “work hard” and energetically toward sales force goals.
2.5.1 Supervising Salespeople
Companies vary in how closely they supervise their salespeople. Many help salespeople identify
target customers and set call objectives. Some may also specify how much time the sales force
should spend prospecting for new accounts and set other time management priorities. One tool
is the weekly, monthly, or annual call plan that shows which customers and prospects to call on
and which activities to carry out. Another tool is time-and-duty analysis. In addition to time
spent selling, the salesperson spends time traveling, waiting, taking breaks, and doing
administrative chores.
Many firms have adopted sales force automation systems: computerized, digitized sales force
operations that let salespeople work more effectively anytime, anywhere. Companies now
routinely equip their salespeople with laptops or tablets, smartphones, wireless connections,
videoconferencing technologies, and customer-contact and relationship management software.
The result is better time management, improved customer service, lower sales costs, and
higher sales performance. In all, technology has reshaped the ways in which salespeople carry
out their duties and engage customers.
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Social selling technologies are helping to make sales forces more efficient, cost-effective, and
productive.
3. Personal Selling Process
Selling process: The steps that salespeople follow when selling, which include prospecting and
qualifying, preapproach, approach, presentation and demonstration, handling objections,
closing, and follow-up.
3.1 Steps in the Selling Process
The selling process consists of several steps that salespeople must master. These steps focus on
the goal of getting new customers and obtaining orders from them.
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information about its products, buyers, and buying processes. Then the salesperson must apply
the research gathered to develop a customer strategy.
3.1.3 Approach
Approach: The sales step in which a salesperson meets the customer for the first time.
During the approach step, the salesperson should know how to meet and greet the buyer and
get the relationship off to a good start. The approach might take place offline or online, in-
person or via digital conferencing or social media. The opening lines should be positive to build
goodwill from the outset. This opening might be followed by some key questions to learn more
about the customer’s needs.
3.1.4 Presentation and Demonstration
Presentation: The sales step in which a salesperson tells the “value story” to the buyer, showing
how the company’s offer solves the customer’s problems.
The goal should be to show how the company’s products and services fit the customer’s needs.
Moreover, buyers don’t want just products; they want to know how those products will add
value to their businesses. They want salespeople who listen to their concerns, understand their
needs, and respond with the right products and services.
The solutions approach calls for good listening and problem-solving skills.
Salespeople must also plan their presentation methods. Good interpersonal communication
skills count when it comes to engaging customers and making effective sales presentations.
3.1.5 Handling Objections
Handling objections: The sales step in which a salesperson seeks out, clarifies, and overcomes
any customer objections to buying.
Customers almost always have objections during the presentation or when asked to place an
order. The objections can be either logical or psychological, and they are often unspoken. In
handling objections, the salesperson should use a positive approach, seek out hidden
objections, ask the buyer to clarify any objections, take objections as opportunities to provide
more information, and turn the objections into reasons for buying.
3.1.6 Closing
Closing: The sales step in which a salesperson asks the customer for an order.
Salespeople should know how to recognize closing signals from the buyer, including physical
actions, comments, and questions. Salespeople can use any of several closing techniques. They
can ask for the order, review points of agreement, offer to help write up the order, ask whether
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the buyer wants this model or that one, or note that the buyer will lose out if the order is not
placed now.
3.1.7 Follow-up
Follow-up: The sales step in which a salesperson follows up after the sale to ensure customer
satisfaction and repeat business.
Right after closing, the salesperson should complete any details on delivery time, purchase
terms, and other matters. The salesperson then should schedule a follow-up call after the buyer
receives the initial order to make sure proper installation, instruction, and servicing occur.
Satisfaction, surveys, questionnaires, possibility of repeating sale, tracking.
3.2 Personal Selling and Managing Customer Relationships
The sales force usually plays an important role in customer relationship building. The selling
process must be understood in the context of building and maintaining profitable customer
relationships.
Today’s buyers are increasingly moving through the early stages of the buying process
themselves, before ever engaging sellers. Salespeople must adapt their selling process to match
the new buying process. That means discovering and engaging customers on a relationship
basis rather than a transaction basis.
4. Sales Promotion
Sales promotion: Short-term incentives to encourage the purchase or sale of a product or a
service.
It offers reasons to buy now. Sales promotion includes a wide variety of promotion tools
designed to stimulate earlier or stronger market response.
4.1 The Rapid Growth of Sales Promotion
Sales promotion tools are used by most organizations, including manufacturers, distributors,
retailers, and not-for-profit institutions. They are targeted toward final buyers (consumer
promotions), retailers and wholesalers (trade promotions), business customers (business
promotions), and members of the sales force (sales force promotions).
Several factors have contributed to the rapid growth of sales promotion, particularly in
consumer markets.
Product managers inside the company face greater pressures to increase current sales,
and they view promotion as an effective short-run sales tool.
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Externally, the company faces more competition, and competing brands are less
differentiated. Increasingly, competitors are using sales promotion to help differentiate
their offers.
Advertising efficiency has declined because of rising costs, media clutter, and legal
restraints.
Consumers have become more deal oriented. They are demanding lower prices and
better deals. Sales promotions can help attract today’s more thrift-oriented consumers.
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They must determine the size of the incentive. A certain minimum incentive is
necessary if the promotion is to succeed; a larger incentive will produce more sales
response.
The marketer also must set conditions for participation. Incentives might be offered
to everyone or only to select groups.
Marketers must determine how to promote and distribute the promotion program
itself. Each distribution method involves a different level of reach and cost.
The length of the promotion is also important. If the sales promotion period is too
short, many prospects (who may not be buying during that time) will miss it. If the
promotion runs too long, the deal will lose some of its “act now” force.
Evaluation is also very important. Marketers should work to measure the returns on
their sales promotion investments. The most common evaluation method is to
compare sales before, during, and after a promotion.
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