Sales and Distribution

Mgmt for Lawyers

MKTG206
Module - I
 INTRODUCTION
• “Sales management” originally referred exclusively to the direction of sales force
personnel.
• Later, the term took on broader significance—in addition to the management of
personal selling.
• “sales management” meant management of all marketing activities, including
advertising, sales promotion, marketing research, physical distribution, pricing, and
product merchandising.
• American Marketing Association agreed that sales management meant “the
planning, direction, and control of personal selling, including recruiting, selecting,
equipping, assigning, routing, supervising, paying, and motivating as these tasks
apply to the personal salesforce.”
• Distribution is the process of making a product or service available for use or
consumption to the end consumer or business.
• The American Marketing Association’s definition made sales management
synonymous with management of the sales force, but modern sales managers have
considerably broader responsibilities.
• Sales managers are responsible for organizing the sales effort, both within and
outside their companies. Within the company, the sales manager builds formal and
informal organizational structures that ensure effective communication not only
inside the sales department but in its relations with other organizational units.
Outside the company, the sales manager serves as a key contact with customers and
other external publics and is responsible for building and maintaining an effective
distribution network.
 Objectives of Sales Management
• From the company’s viewpoint, there are three general objectives of sales
management: sales volume, contribution to profits, and continuing growth.
Quantitative Objectives (Short-term)
• To retain and capture market share.
• To determine sales volume in ways that contribute to profitability.
• To obtain new accounts of given types.
• To keep personal expenses within specified limits.
• To secure a targeted percentage of certain accounts of a business.
• Qualitative Objectives (Long-term)
• To do the entire selling job.
• To service existing accounts, (customers).
• To search and maintain customer cooperation.
• To assist the dealer in selling the product line.
• To provide technical advice wherever necessary.
• To assist in training of middleman’s sales personnel.
• To provide advice and assist the middlemen.
• To collect and report market information of interest and use to the company
management.
 Functions of sales Management

Different sales management functions are:

1. Managerial functions
2. Staff functions
3. Advisory functions
4. Liaison Functions

1. Managerial functions
Planning
• Forecasting demand
• Sales territory planning
• Personal selling
• Promotional efforts.
Organizing
• Structure
• Resource allocation
• Responsibility assignment
• Delegation of authority
 Continued….

Direction
• Leadership
• Motivation
• Communication
• Promotional steps including personal selling
Control
• Delegation
• Quota fixing
• Performance evaluation
• Incentives
• Budgets
Co-ordination
• Liaison
• Integration of various elements internally
• Public Relations
• Creating goodwill
 Continued…

2. Staff functions
• Recruitment and selection.
• Deployment and evaluation of performance
• Training and development.
• Career development.
• Compensation and incentives.
• Motivation and empowerment
3. Advisory functions
• Product attributes/quality aspects.
• Pricing policies.
• Promotional steps
• Personal selling aspects.
• Distribution policies and channel selection criteria.
• Advertisement policies such as media selection and target audience.
• Transportation and warehousing aspects.
 Continued….

4. Liaison Functions
• Production department.
• Finance department.
• Marketing department.
• R & D department
• Distribution network
• After Sales Service department
 Selling Strategy
• A sales strategy considers the product and/or services a company offers and
determines the best steps to take to reach potential customers and increase sales.
• Selling strategies are meant to provide clear objectives and guidance to your sales
organization. They typically include key information like: growth goals, KPIs,
buyer personas, sales processes, team structure, competitive analysis, product
positioning, and specific selling methodologies.
• Establishing a sales strategy takes planning. One need’s to consider the target
market, the resources available, and the right format for one’s business. By
determining what type of sales force is needed and ensuring the sales staff is
trained, one can go through the sales activities that lead to solid sales. Effective
sales people will prospect, prioritize contacts, meet average sales call goals, and
have an average dollars per sale consistent with other salespeople.
• One of the first steps in creating an effective sales plan is organizing your sales
team. One needs to organize one’s sales people to sell as many products as possible
and grow the success of one’s organization.
• First, one need’s to determine the type of sales force. 1. Internal sales people or 2.
Independent representatives? Internal sales people are employees of the company
and focus exclusively on growing the sales for their employer. Independent
representatives are contractors who work for themselves. They might work for
additional companies and sell multiple products.
 Continued…
• Managing a Sales Team -Creating a prosperous, exciting sales team is fundamental
to one’s success in the market. There are several key components to consider when
developing one’s sales strategy.
• The Salesman - Salesmanship is the act of applying the techniques of selling to sell
the products or services. Salesmanship is one aspect of personal selling—it is never
all of it. Salesmanship is one of the skills used in personal selling: it is the art of
successfully persuading prospects or customers to buy products or services from
which they can derive suitable benefits, thereby increasing their total satisfactions.
• At one time, the emphasis in salesmanship was almost wholly on
persuasion; today, while recognizing the significance of persuasion, the
emphasis is on the benefits attractive to prospects and customers. One
variation of benefit-oriented salesmanship is “consultative selling”—creating
long-term, mutually beneficial sales relationships with customers by helping them
to improve their profits through products and services.
• Fundamental to understanding salesmanship is recognition that it involves buyer-
seller interactions. Sociologists use the term “dyad” to describe a situation in which
two people interact. The salesperson and the prospect, interacting with each other,
constitute one example of a “buyer-seller dyad.” Another is the interaction of a
seller using advertising with a particular prospect in the reading, listening, or
viewing audience.
• .
 Personal Selling
• Personal selling - Personal selling establishes a one-to-one personal contact with
the customers to sell the product and deliver satisfaction. Personal selling occurs
when a sales representative meets with a potential client for the purpose of
transacting a sale.
• According to American Marketing Association, “Personal selling is the oral
presentation in a conversation with one or more prospective purchasers for the
purpose of making sale; it is the ability to persuade the people to buy goods and
services at a profit to the seller and benefit to the buyer”.
• In the word of Professor William J. Stanton, “Personal selling consists in
individual; personal communication, in contrast to mass relatively impersonal
communication of advertising; sales promotion and other promotional tools”.
• The main features of personal selling are:
• i. It is a face to face communication between buyer and seller.
• ii. It is a two way communication.
• iii. It is an oral communication.
• iv. It persuades the customers instead of pressurizing him/her.
• v. It provides immediate feedback.
• vi. It develops a deep personal relationship apart from the selling relationship with
the buyers and customers.
 Personal Selling Process:

• The process of personal selling includes prospecting and evaluating, preparing,

approach and presentation, overcoming objections, closing the sale and a follow up
service.
1. Prospecting and evaluating:
• The effort to develop a list of potential customers is known as prospecting. Sales
people can find potential buyers, names in company records, customer information
requests from advertisements, telephone and trade association directories, current
and previous customers, friends, and newspapers. Prospective buyers
predetermined, by evaluating (1) their potential interest in the sales person’s
products and (2) their purchase power.
2. Preparing:
• Before approaching the potential buyer, the sales person should know as much as
possible about the person or company.
3. Approach and presentation:
• During the approach, which constitutes the actual beginning of the communication
process, the sales person explains to the potential customer the reason for the sales,
possibly mentions how the potential buyer’s name was obtained, and gives a
preliminary explanation of what he or she is offering. The sales presentation is a
detailed effort to bring the buyer’s needs together with the product or service the
sales person represents.
 Continued….
4. Overcoming objections:
• The primary value of personal selling lies in the sales person’s ability to receive and
deal with potential customers’ objections to purchasing the product. In a sales
presentation many objections can be dealt with immediately. These may take more
time, but still may be overcome.
5. Closing the sale:
• Many sales people lose sales simply because they never asked the buyer to buy. At
several times in a presentation the sales person may to gauge how near the buyer is
to closing.
6. Follow up:
• To maintain customer satisfaction, the sales person should follow up after a sale to
be certain that the product is delivered properly and the customer is satisfied with
the result.
Objectives of Personal Selling:
• (i) Attracting the Prospective Customers:
• The first and foremost objective of a salesperson is to attract the attention of people
who might be interested to buy the product he is selling.
 Continued…..

(ii) Educating the Prospective Customers:

• The salesman provides information about the features, price and uses of the product
to the people. He handles their queries and removes their doubts about the product.
He educates them as to how their needs could be satisfied by using the product.
(iii) Creating Desire to Buy:
• The salesman creates a desire among the prospective customers to buy the product
to satisfy specific needs.
(iv) Concluding Sales:
• The ultimate objective of personal selling is to win the confidence of customers and
make them buy the product. Creation of customers is the index of effectiveness of
any salesperson.
(v) Getting Repeat Orders:
• A good salesperson aims to create permanent customers by helping them satisfy
their needs and providing them product support services, if required. He tries for
repeat orders from the customers.
 Technology’s Impact on Sales
• Technology is transforming businesses and disrupting entire industries. One of
those industries that has been heavily affected is sales. From prospecting to closing,
today’s mobile, social, big data, and cloud technologies are revamping the sales
process in ways that would have been unthinkable only a few decades ago. As a
result, many sales organizations are embracing new technologies to drive
productivity, profitability, and competitive advantage to revamp the sales process .
• Impact of Big Data on Sales - In today’s world, competitive advantage for sales
organizations depends largely upon the ability to successfully capture, manage, and
analyze massive volumes of customer data that contains insights into customer
behaviors and buying habits. Despite this, the average company only analyzes
roughly 12% of the data that they have available. This is where “big data”
technology comes in.
• Using big data analytics tools, sales organizations can now manage prospecting, a
critical step in the sales process. Traditionally, prospecting (finding and qualifying
potential customers with specific needs and wants has been a time and labor-
intensive process. Now, through the use of analytics and customer data models,
organizations can not only identify potential customers, but more accurately predict
which leads from B2C or B2B lead generation efforts are likely to become clients.
This gives the sales team a clearer idea of where to focus their efforts.
 Continued….

• Analytics also help organizations determine which customers to target, how to use
profiles to identify lookalike customers and which buyers are most likely to respond
to different messages and offers. In short, big data analytics tools help organizations
focus their sales efforts on the most promising and profitable activities and
customers.
• Impact of Sales Force Automation (SFA) on Sales – Statistics show that
businesses without automation spend 71 percent of their time and resources
planning and defining business processes. The same holds true for sales
organizations. Selling requires a number of tedious, time-consuming, and repetitive
tasks, such as scheduling sales appointments, sending follow-up emails, and
updating sales opportunities(all of which reduce productivity and profitability).
• Sales Force Automation (SFA) technology solutions automate many tasks, freeing
up sales employees to focus on activities that generate more sales and revenue. SFA
allows sales managers to keep their teams up to date on current and new products
and services. With SFA, managers can also have instant access to activities of
individual sales employees, sales figures, opportunities, customer complaints, and
other data used to determine sales success. Armed with information provided in real
-time, managers can take action and make adjustments quickly to optimize efforts.
 Continued…..
• Impact of Cloud CRM on Sales – Cloud-based CRM Technology: Customer
Relationship Management systems are powerful tools designed to give
organizations a holistic view of the customer relationship by integrating marketing,
sales, and customer support. While traditional onsite CRM software has their
merits, cloud technology takes CRM to a whole new level by freeing up employees
from onsite computers and servers. When CRM data is stored in the cloud, it can be
accessed directly from anywhere and at anytime.
• When deployed correctly, a CRM presents a huge advantage for sales employees,
as it allows them to get fast and accurate insights on what customers are doing,
what they’re drawn to, and when they are mostly likely to buy. Armed with up-to-
date, relevant information and the ability to contact customers and prospects while
on the go, a sales team becomes more agile, effective, and productive. Thanks to
the cloud, organizations can take advantage of software packages that integrate SFA
and CRM into a single, cost-effective solution.
• As for investment costs, the average return on investment for CRM tools is $5.60
for every $1.00 spent.
• Impact of Social Platforms on Sales – The explosion of social technology has
given rise to a number of social media platforms for attracting and engaging new
customers, a vital step in getting a customer into the sales funnel. Social media
platforms provide opportunities for companies to “shake hands” with customers,
engaging them in conversations about products and services for valuable insights
 Continued…..
that could lead to a sale. Unlike conventional sales, social media makes it possible to
shake millions of hands from across the entire world all at once. Today’s customers
are more connected than ever due to social media platforms. Statistics show that a
majority are turning to peer recommendations and reviews on social media as part
of their product research—in fact, for the average customer, peer recommendations
carry 10 times the weight of recommendations from salespeople. Even more
revealing is the fact that most buyers have all but completed their sales journey
before ever contacting a seller. Organizations can follow this trail of digital
breadcrumbs from prospective buyers on social media, and better target potential
customers at just the right point in the decision making process.
• Customer feedback on social media sites also helps businesses refine and shape
their messages and sales tactics to ensure greater success in the future. Social
platforms offer a unique advantage for sales teams, and studies suggest that 78% of
sales professionals who use social media consistently outsell their peers who
don’t.
• Impact of Mobile Technology on Sales - The proliferation of mobile devices, such
as smartphones and tablets, has changed many aspects of the selling process
forever. For customers, the ability to research, evaluate and purchase products and
services online using this technology has transformed the buying experience.
Marketers and sales teams should take that into account, since research shows 93%
of consumers who use their mobile device to research prospective products and
services end up making a purchase.
 New Means of Selling

1. Service selling aims to obtain sales from existing customers whose habits and
patterns of thought are already conducive to such sales.
2. Developmental selling aims to convert prospects into customers. Developmental
selling, in other words, seeks to create customers out of people who do not
currently view the salesperson’s company favorable, and who likely are resistant to
changing present sources of supply.
1. Service selling -
a. Inside Order Taker—“waits on” customers; for example, the sales clerk behind the
neckwear counter in a men’s store.
b. Delivery Salesperson—mainly engages in delivering the product; for example,
persons delivering milk, bread, or fuel oil.
c. Route or Merchandising Salesperson—operates as an order taker but works in the
field—the soap or spice salesperson calling on retailers is typical.
d. Missionary—aims only to build goodwill or to educate the actual or potential user,
and is not expected to take an order; for example, the distiller’s “missionary” and
the pharmaceutical company’s “detail” person.
e. Technical Salesperson—emphasizes technical knowledge; for example, the
engineering salesperson, who is primarily a consultant to “client” companies.
 Continued…..
2. Developmental selling -
a. Creative Salesperson of Tangibles—for example, salespersons selling vacuum
cleaners, automobiles, water purifiers, and encyclopedias.
b. Creative Salesperson of Intangibles—for example, salespersons selling insurance,
advertising services, and educational programs.
The goal of modern selling is to build long-term relationships and to create customers
who will be encouraged to provide repeat business, rather than just generating one-
off sales. As per Peter Collins who is in a sales career spanning more than 50 years,
• Today’s modern salesperson needs to understand that they will need to undertake a
number of responsibilities, accepted these days as a part of the sales process, if they
are to be successful. And although the importance of those responsibilities differs
with the various types of sales positions today, the roles do graphically illustrate the
divergent aspects of selling.
• Problem Solver: One of the key aspects of the role of the modern salesperson is to
help identify and then suggest a solution to a prospect’s challenges (problems). As a
problem (or challenges) solver you identify the prospect’s wants. the salesperson is
there to suggest possible solutions (as they see it) to these wants and needs, and
then be prepared to work with the prospect to help in the assessment of the known
advantages and those perceived disadvantages of each option before them, and then
be there to help select the best alternative (if needed), and through this process, be
available (as required) to help solve the prospect’s challenges.
 Continued…
• Educator: The role of the salesperson as an educator is both a fundamental as well
as a crucial key role. In our complex modern world, it’s vital for someone to keep
the existing customers and prospects abreast of changes – and the best person to do
this is the salesperson. Moreover, it is better for the sales arm of the business to
educate the existing customers and prospects about what you offer, the more
successful one will be as a change Agent.
• Innovator: One thing that sets the best of the salespeople from others is their ability
to embrace innovation. Sales success is totally dependant on establishing new and
innovative ways of doing business and steering away from outdated old concepts.
We are all aware that change is constant, and yet many in all walks of life find it
more comfortable to dismiss change. On the other hand, it is the innovator that
drives those content to remain in a vacuum into accepting then embracing the
change they now want to be a part of. And what sets the best of the salespeople
apart from all others is their ability to grasp innovation and then resell it to others in
a way they eventually accept is their own.
• Communicator: It incorporates relationship build through trust that eventually leads
to an order – and the order is just the start for the professional salesperson. All the
things communicated here about the salesperson are only the tip of the iceberg, as
very few will ever appreciate the time, effort and study the totally devoted
salesperson undertakes to stay on top of his or her craft. No, to be a good
communicator extends far beyond being an effective talker.
 Continued…

• Researcher: Modern selling has many research-oriented components attached to it.

In order to qualify some of the larger business prospects, it is often necessary for
there to be varying degrees of research, much of which can be done on the internet,
and some in libraries. It is also a good idea research even if you sell on a one-to-
one basis in homes or other forms of direct selling. Sometimes it is a good idea to
research by category or for some form of needs basis, or even demographically and
geographically. It’s the same old story, the one that takes the time to research and
prepare is usually the one with better results and a better income.
• Psychologist: All salespeople deal with all kinds of people all day, everyday. For
this reason there is a genuine need to understand how people think, feel, and act,
and it’s this understanding of people becomes critical to sales success. It is for this
reason that much of this book is devoted to various aspects of the psychology of
selling – determined by what challenges the salesperson encounters from one day to
the next and one area to the next.
• Manager: All salespeople, no matter what they sell, must manage their time and
territory. They need to set objectives, develop strategies, and evaluate results.
These are all management tasks. And just because there may not be direct or
ongoing supervision while in the field, the salesperson must manage themselves in
order to survive. Given the high cost of selling these days and the constantly
changing environment, self and territory management is essential.
 Ethical Issues in Sales Management
• Company to the Salesman
(i) Level of pressure
(ii) Decision regarding territory
(iii) To tell the truth
(iv) Hiring medically unfit salesman
• Salesman to the Company
(i) Misuse of company assets – When salesmen misuses the assets of the company for
his / her own personal usage.
(ii) Moonlighting – When salesmen does another work or works for another company
during the working hours.
(iii) Inflated expenses – When the salesmen misusing the benefits provided by the
company.
(iv) Damaged merchandise
(v) Taking away customers
(vi) Misuse of I.T. and Data theft
• Salesman to the Customers
(i) Corporate gifts
(ii) Misrepresentation
(iii) Entertainment
 Quiz
1. “Sales management” originally is referred to as _____________
2. To retain and capture market share is the ___________objective of sales
management.
3. Qualitative Objectives includes ____________________
4. ____________ is the managerial function of sales management

5. Deployment and evaluation of performance is the __________ function of sales

management
6. Missionary selling means _________________

Answer Key :
1. Direction of sales force personnel
2. Quantitative objective
3. To service existing accounts
4. Planning, organizing, direction, control, co-ordination
5. Staff function
6. Only to build goodwill or to educate the actual or potential user, and is not expected
to take an order