Chapter 18 - Personal Selling and Sales Management
These are the learning objectives for this chapter.
Gloria Mayfield Banks, a Harvard MBA, has earned more that $5 million in commissions as a National Sales Director.
Many people are shocked to learn how many employees hold sales positions. Your students may have had experience in retail sales and think that all sales jobs are like that. Remind them that though many retail positions exist, professional sales positions involve a more involved skill set and offer much higher rewards.
Ask students : Do you want to plan your own schedule and decide how much money you will make? These are just two of the many benefits of professional selling. The visibility of sales positions also offers many opportunities for advancement. This web link is for a website for sales jobs…it would be interesting to look at with the students and what kinds of jobs are available in your area.
Ask students: Hoe does the sales force create value for the firm through relationship selling? Through relationship selling the sales force: focuses on building long term customer relationships, contributes to building customer loyalty, assists the firm in identifying new opportunities with existing customers.
This graph introduces the personal selling process, which the following slides cover in depth. It also may be used alone in a shortened lecture.
Group activity : Often the best source of new customers are other people. Imagine you sell investment properties; list the people you know who might provide you with viable customer contacts. How else might you gather a list of potential customers to contact? Now role play a cold calling scenario, in which one group member “calls” the others. What challenges do you face? Would your task have been easier had you had some introduction to these “customers”?
The first step in the selling process is to generate a list of potential customers ( leads) and assess their potential ( qualify) .
A qualified lead requires a meeting. As the old saying goes, “You never get a second chance to make a first impression,” so salespeople must prepare carefully. Ask students : What kinds of preparation can help ensure the first meeting goes well? The sales person needs to have investigated the customer’s business and defined how the customer can benefit from the firm’s products/services. If possible the sales person should examine how the customer is currently addressing the needs it is wishing to fulfill.
To handle the most difficult part of the sales encounter, salespeople go through extensive training to learn how to deal with reservations
Group activity: Role play a salesperson and a potential customer during the presentation. The customer should express several reservations; as the salesperson, how will you deal with them? Discuss each group’s performance. The B2B process must align closely with the selling process. A seller, for instance, shouldn’t be trying to close a deal when the buyer is just determining the product specifications .
The “ABCs” of selling suggest salespeople must “Always Be Closing,” but this difficult process requires far more extensive training than that. Group activity: Continue with the previous activity. Have students practice closing the sale
Salespeople must always remember that the sale is just the beginning of a customer relationship. Ask students: What methods can salespeople use to ensure they follow up effectively with their customers? Does it differ for B2B versus B2C selling situations? Follow up involves ensuring that customers are satisfied with their purchases. The same techniques are used in both B2B and B2C selling. Most firms now have systems to ensure the after the sale communication is established, either by telephone, email, or in person.
Ask students : How has greatly expanded access to information in the modern world improved salespeople’s ability to deliver value? This link is for salesforce.com which sells Customer Relationship Management software for the sales force.
Ethical and legal issues in personal selling can be classified into three broad categories. Ask students: what ethical issues may occur in each of these three broad categories .
Ask students: How would you handle a situation if you worked for a firm that a. sold alcohol directed towards teenagers; b. sold high-sugar products to children sold mortgages to high risk home buyers? Inadequate Hurricane coverage? This should lead to an interesting discussion.
Ask students : Have you ever felt that you have been treated unethically by a salesperson? What happened? Possible answers: Salesperson lied to me. Salesperson ignored me. Salesperson sold me something I didn’t want/need?
Sales management plans, directs, and controls personal selling activities, from recruitment to evaluation. This chapter reviews each of these elements in detail.
Group activity: Develop a sales force structure for a hypothetical company. (Students might use the same hypothetical company for which they previously developed a marketing mix.) Will your company rely on its own sales force or manufacturers’ reps? Why? If you decide to use your own sales force, how will you assign selling tasks to your salespeople. Will you use a group selling approach or employ individual salespeople for each role? Why?
Although the life of a professional salesperson is highly varied, sales people generally play three important roles: order getting, order taking, and sales support.
Are salespeople born, or can they be trained? The answer may be a bit of both. Some people possess certain personality elements that suggest their success, but even they need a lot of training. Ask students : Who in this class do you think would be a good salesperson? Why?
The personality of the sales force should match the personality of the brand. Sometimes companies use personality tests or have the potential salesperson run a mock sales presentations
Because of their roles as experts, salespeople must possess a lot of knowledge about the products/services they provide. Therefore, all salespeople, regardless of how good or experienced, benefit from training .
Ask students: What would you consider an appropriate sales force incentive, salary or commission? People are motivated by commissions, but commission only salespeople are not as motivated to take care of non-sales related duties. Ask students: which would you rather win, a special parking space that says, “salesperson of the month,” or $25? Unless the monetary award is substantial, the recognition by superiors and peers of a job well-done is typically more effective.
By linking the evaluation system to the reward system, management ensures salespeople understand what is expected of them. Ask students: should salespeople’s evaluation system be based strictly on sales? Answer: probably not. Unless there are some subjective evaluation criteria such as customer service, teamwork, or relationship building, sales will probably suffer in the long run.
Ans. E Explanation: While most consumers think of personal selling as face-to-face communication it can also take place through other communications channels.
Ans. C Explanation: Personal selling adds value by educating and providing advice, saving the customer time, and making things easier for the customer.
Ans. B Explanation: During the preapproach stage salespeople research and develop plans for meeting with potential customers.
Generate and qualify leads, preapproach, sales presentation, and overcoming reservations, closing the sale, follow-up. It helps the customer become educated about the product or get valuable advice. Sales people can also simplify the buying process and therefore save the customer time and hassle. .
Ans. B Explanation: Because there tend to be fewer B2B customers available to sell to, it is important for salespeople to continually find new and potentially profitable customers.
They get to know his or her sales people to determine what motivates them to be effective. Some sales people prize their freedom and like to be left alone, whereas others want attention and are more productive when they receive accolades for a job well done. Still others are motivated primarily by monetary compensation. Great sales managers determine how best to motivate each of their sales people according to what is most important to each individual. Financial rewards have a cash value to them. Nonmonetary have more of a symbolic value. A combination of both types of rewards is best.
A company sales force comprises people who are employees of the selling company.
Manufacturer’s representatives are sales people who sell a manufacturer’s products on an extended contract basis but are not employees of the manufacturer.
An order getter is a salesperson whose primary responsibilities are identifying potential customers and engaging those customers in discussions to attempt to make a sale.
An order taker is a salesperson whose primary responsibility is to process routine orders or reorders or rebuys for products.
The preapproach occurs prior to meeting the customer for the first time and extends the qualification of leads procedure.
Relationship selling is a sales philosophy and process that emphasizes a commitment to maintaining the relationship over the long term and investing in opportunities that are mutually beneficial to all parties.
Learning Objectives LEARNING OBJECTIVES How does personal selling add value? What is the personal selling process? How do technology and the Internet affect personal selling? What are the key functions of a sales manager? 18-2
Mary Kay Inc. Beauty Consultants − Retain gross profits on each product − Earn commissions on their sales teams 18-3
Professional Selling as a Career People love the lifestyle There is a lot of flexibility There is a lot of variety in the job Can be very lucrative Very visible to management and good for promotions Sales Jobs Website 18-5
Personal Selling and Marketing Strategy Can customize the message for a specific buyer Assists in creating strong supply chain relationships Increased customer loyalty through relationship selling Gather research input from customers Crucial to the success of CRM 18-6
The Impact of Technology and the Internet on Personal Selling Salesforce.com Website 18-15
Ethical and Legal Issues in Personal Selling 18-16
Issues for the Sales Force and Corporate Policy The firm may have a policy to sell goods or The firm may have a policy to sell goods orservices to people who cannot afford them orservices to people who cannot afford them or to people who should not have them. to people who should not have them. 18-17
Issues for the Sales Person and the CustomerHave you ever felt that you were treated unethically by a salesperson? What happened? 18-18
Evaluating Salespeople Tied to the reward structure Evaluation measures can be either objective or subjective 18-26
Personal selling can take place in which of the following situations?A. Face-to-faceB. Over the internetC. Video teleconferencingD. Over the telephoneE. All of the above 18-27
The basic consideration that determines whether a company will hire a sales force is:A. can the sales manager find good salespeople?B. does the company have a “hot” product?C. is a sales force worth more than it costs?D. will the manager be able to find an effective supply chain manager?E. will online advertising work? 18-28
The preapproach stage occurs prior to meeting the customer for the first time and:A. includes initiating new qualify leads.B. extends the qualification of leads procedure.C. focuses on closing the sale.D. ensures effective follow-up.E. follows the sales presentation. 18-29
Check Yourself1. What are the steps in the personal selling process?2. How does the selling process impact the business to business buying process? 18-30
In B2B market situations, it is particularly important to:A. buy customers lunch.B. continually find new and potentially profitable customers.C. closing the sale early in the day.D. have order takers act as order getters.E. all of the above. 18-31
Check Yourself1. What do sales managers need to do to successfully manage their sales force?2. What is the difference between monetary and nonmonetary incentives? 18-32