C H A P T E R © 2007 The McGraw-Hill Companies, Inc. All rights reserved. McGraw-Hill/Irwin Personal Selling and Sales Management 19

19-2 © 2007 The McGraw-Hill Companies, Inc. All rights reserved. Bearden Marketing 5 th Ed Learning Objectives After studying this chapter, you should be able to:  Understand the role and importance of personal selling in the marketing communications mix.  See how the key steps in personal selling depend on a relationship perspective.  Identify the similarities and differences in the job responsibilities of salespeople and sales managers.  Describe the key activities in sales management.  Appreciate important ethical issues faced by salespeople and sales managers.

19-3 © 2007 The McGraw-Hill Companies, Inc. All rights reserved. Bearden Marketing 5 th Ed Opening Vignette Started in 1849, Pfizer has grown to be a worldwide pharmaceutical company. Much of this success came under the leadership of CEO William Steere. Steere started as a Pfizer sales representative in San Francisco over 40 years ago. Pfizer is the leading pharmaceutical company in the world, with annual sales in excess of $52 billion. Effective personal selling is one of the keys to Pfizer’s success.

19-4 © 2007 The McGraw-Hill Companies, Inc. All rights reserved. Bearden Marketing 5 th Ed Contributions of Personal Selling to Marketing Producing Sales Revenue Meeting Buyer Expectations Providing Marketplace Information Multiple Roles of Salespeople

19-5 © 2007 The McGraw-Hill Companies, Inc. All rights reserved. Bearden Marketing 5 th Ed The “Dos” of Salespeople  Know your product and its competition better than the buyer does.  Be a tough, but open, negotiator.  Have the backing of your company to make strategic partnerships.  Understand the customer’s future plans and offer ideas about how your company can help further them.  Be willing to change your processes and products.  Offer something unique—a technological change, a new way of delivering, or a large price concession.  Get to know all the people interested in the product, from purchasing managers to engineers.  Keep on top of potential product problems.  Be able to explain how your company plans to improve the quality and reliability of its products.

19-6 © 2007 The McGraw-Hill Companies, Inc. All rights reserved. Bearden Marketing 5 th Ed The “Don’ts” of Salespeople  Use industry buzzwords without knowing what you’re talking about.  Portray your company as quality-conscious if it’s not.  Focus exclusively on short-term sales goals.  Talk about strategic alliances without having the support of your company.  Say, “We want your business, and we’ll make it up later.”  Try to persuade purchasers to buy something that doesn’t meet their needs.  Simply talk pricing or Give a canned presentation.  Come without ideas or Know nothing about the competition.  Fly by the seat of your pants.  Offer products today that you’re not likely to have tomorrow.  Roll over dead in negotiations.

19-7 © 2007 The McGraw-Hill Companies, Inc. All rights reserved. Bearden Marketing 5 th Ed Technical Support Technical support salespeople have expertise in areas such as design and installation of complex equipment and may provide specialized training to customer employees. Sales Support Sales support salespeople are not directly involved in concluding customer purchases. They support the personal product selling function by promoting a product or providing technical support. more Types of Personal Selling Jobs

19-8 © 2007 The McGraw-Hill Companies, Inc. All rights reserved. Bearden Marketing 5 th Ed ExistingBusiness Existing-business salespeople, sometimes called order takers, include wholesaler reps who follow an established route, writing up fairly routine orders from their customers. NewBusiness Members of the sales force who concentrate on selling new products or selling to new customers are called new-business salespeople. more Types of Personal Selling Jobs (con’t)

19-9 © 2007 The McGraw-Hill Companies, Inc. All rights reserved. Bearden Marketing 5 th Ed Direct to Consumer Direct-to-consumer salespeople sell to individuals who personally use the products and services. This category includes over 4.5 million retail salespeople and over a million others who sell residential real estate and financial securities to ultimate consumers. Several additional million direct-to-consumer salespeople represent firms such as Avon, Mary Kay, Tupperware, Creative Memories, Amway, and other direct-selling companies. Types of Personal Selling Jobs (con’t)

19-10 © 2007 The McGraw-Hill Companies, Inc. All rights reserved. Bearden Marketing 5 th Ed The Sales Process

19-11 © 2007 The McGraw-Hill Companies, Inc. All rights reserved. Bearden Marketing 5 th Ed Sales Management Activities The starting point for sales management is developing a sales strategy to execute the firm’s marketing strategy, which emphasizes the development of a marketing mix to appeal to defined target markets. A sales strategy focuses on how to sell to specific customers within those target markets. Two key elements of a sales strategy are a relationship strategy and a sales channel strategy.

19-12 © 2007 The McGraw-Hill Companies, Inc. All rights reserved. Bearden Marketing 5 th Ed Sales Management Activities  Should salesforce be generalists or specialists?  If specialists, should they be product, market, customer, or functional specialists?  Should centralized or decentralized control be used?  How large should the salesforce be?  How should customers and geographic areas be assigned to form sales territories?  How should salesforce turnover be factored into sales organization design decisions?

19-13 © 2007 The McGraw-Hill Companies, Inc. All rights reserved. Bearden Marketing 5 th Ed Sales Management Activities The main activities are:  Recruiting is the process of finding prospective job candidates  Selecting involves choosing the candidates to be hired  Initial training, which typically focuses on product knowledge and sales techniques  Continual training for all salespeople is becoming more standard as firms attempt to stay current and competitive in an ever-changing environment.

19-14 © 2007 The McGraw-Hill Companies, Inc. All rights reserved. Bearden Marketing 5 th Ed Sales Management Activities Directing salespeople to meet goals and objectives consumes much of the typical sales manager’s time. These activities include:  Motivation  Supervision  Leadership of the sales force.

19-15 © 2007 The McGraw-Hill Companies, Inc. All rights reserved. Bearden Marketing 5 th Ed Sales Management Activities Sales managers must establish standards by which performance and effectiveness are measured, evaluate performance and effectiveness against these standards, and then take appropriate follow-up action.  Salesperson performance refers to how well individual sales people meet job expectations.  An evaluation of sales force effectiveness is in fact an assessment of the entire sales organization.

19-16 © 2007 The McGraw-Hill Companies, Inc. All rights reserved. Bearden Marketing 5 th Ed Sales Forces Effectiveness Example

19-17 © 2007 The McGraw-Hill Companies, Inc. All rights reserved. Bearden Marketing 5 th Ed Unethical Sales Behaviors  Exaggerating features and benefits  Lies about availability  Lies about competition  Sells something people don’t need  Giving false answers to questions  Falsifying product testimonials  Passing blame for their own mistakes  Pose as market researcher when doing phone sales  Misrepresent warranties & guarantees  Make nonbinding oral promises  Bending company rules  Selling dangerous or hazardous products

19-18 © 2007 The McGraw-Hill Companies, Inc. All rights reserved. Bearden Marketing 5 th Ed Salesperson Competencies  Align customers’ strategic objectives with your company’s so both gain.  Go beyond product needs to assess business potential and add value to the relationship.  Understand the financial impact of the decisions made by your company and the client’s organization.  Organize company resources to build customer-focused relationships.  Develop consultative problem solving and a willingness to change.  Establish a vision of a committed customer–supplier relationship.  Utilize self-appraisal and continuous learning by requesting feedback from customers, colleagues, and managers.

19-19 © 2007 The McGraw-Hill Companies, Inc. All rights reserved. Bearden Marketing 5 th Ed Sales Manager Competencies  Provide strategic vision.  Organize company resources by leveraging relationships.  Influence company strategy.  Coach effectively.  Diagnose performance.  Select high-potential salespeople.  Leverage technology.  Demonstrate personal selling effectiveness.

19-20 © 2007 The McGraw-Hill Companies, Inc. All rights reserved. Bearden Marketing 5 th Ed SummarySummary After studying this chapter, you should be able to:  Understand the role and importance of personal selling in the marketing communications mix.  See how the key steps in personal selling depend on a relationship perspective.  Identify the similarities and differences in the job responsibilities of salespeople and sales managers.  Describe the key activities in sales management.  Appreciate important ethical issues faced by salespeople and sales managers.