WELCOME TO SALES & SALES MANAGEMENT SHAPING FUTURE SALES LEADERS Del Shepard, Ph.D.

SMALL GROUP ACTIVITY  In small groups, make a list of the pros and cons of the “sales” profession.  Why these perceptions exist?  What have businesses done to cause or prevent these pros and cons?  What might be attractors and distractors for entering this type of profession?

 Paid personal communication that attempts to inform customers and persuade them to buy products in an exchange situation  Enables marketers to focus on the most promising sales prospects Personal Selling

 Sales career offers:  Flexible hours  Potential for high earnings  High degree of job satisfaction  New technologies make personal selling faster, more efficient and easier Importance of Personal Selling

 High levels of professionalism, technical skills, and interpersonal skills  Well trained regarding both the products and the selling process  Awareness of the competitors  Function as knowledge experts for the firm  Provide key information for marketing decisions Requirements for the Sales Personnel

 Customer information is shared through social media, mobile and Web applications, and electronic sales presentations  Social CRM (Customer Relationship Management) - Provides opportunities to manage data in discovering and engaging customers Technology in Personnel Selling

General Steps in the Personal Selling Process Trial Closing

Prospecting  Developing a database of potential customers  Sources for the names of the potential customers  Company sales records and trade shows  Commercial databases  Newspaper announcements and public records  Telephone directories  Trade association directories  Traditional and online advertisements  Customer referrals

 Salespeople analyze information about the prospect’s needs before contacting them  Identify key decision makers  Review account histories and problems  Contact other clients for information  Assess credit histories and problems  Prepare sales presentations  Identify product needs  Obtain relevant literature Preapproach

 Manner in which a salesperson contacts a potential customer  Is a critical step because the first impression of the salesperson may be long-lasting  Relationship with the prospect must be created  Typical approaches  Referrals  Cold canvassing??????  Repeat contact Approach

 Attracting and holding the prospect’s attention, stimulating interest, and sparking a desire for the product  Presentation should be adapted to the needs of the prospect  Use influencing tactics matched to prospects  Use demonstrations  Making plant visits (clients and your home plant)  Using team sales approach Making the Presentation

 Effective salespeople anticipate and counter objections before the prospect raises them  Safest approach is to be prepared and handle objections as they arise  THIS IS THE MOST DIFFICULT STEP!!  WHY SHOULD IT BE?  IF THE CUSTOMER ASKS QUESTIONS, IT’S BECAUSE THEY ARE STILL INTERESTED Overcoming Objections

 When the salesperson asks the prospect to buy the product  Trial close is attempted by asking questions that assume the prospect will buy  Attempts to close at several points during the presentation takes place as the prospect may be ready to buy  THIS SHOULD BE MOST PLEASANT STEP  THIS IS WHY YOU ARE HERE; TO SELL!!!! Closing the Sale

 Used to determine customers’ future product needs  Determining whether the order was delivered on time and installed properly  Contacting the customer to learn if any problems or questions regarding the product have arisen  THIS IS PROBABLY THE MOST IMPORTANT STEP IN THE ENTIRE PROCESS Following Up

Order getters Current- customer sales New-business sales Order takers Support personnel Missionary salespeople Trade salespeople Technical salespeople Types of Salespeople

Discussion Point Order Getters When we think of sales representatives, order getters or order takers probably come to mind. Order getters sell to new customers or increase selling to existing customers. Order takers primarily seek repeat sales. There are also support personnel who facilitate selling but are not involved in solely making sales.

Using a team of experts from all functional areas of a firm, led by a salesperson, to conduct the personal selling process Team selling Building mutually beneficial long-term associations with a customer through regular communications Relationship selling Types of Selling

Discussion Point Team selling is becoming popular, especially in companies where the selling process is complex and requires a variety of specialized skills.

NOW LET’S SWITCH GEARS!!!  HOW MANY OF YOU ARE IN MANAGEMENT POSITIONS?  HOW MANY WANT TO GET INTO OR STAY IN  MANAGEMENT?  WHAT KIND OF EXPERIENCE DO YOU NEED TO GET INTO MANAGEMENT?  WHAT CAN SPELL REAL TROUBLE FOR A PERSON ENTERING MANAGEMENT WITHOUT THE PRE-REQUISITE EXPERIENCE?

IT IS CRITIAL FOR SALES MANAGERS  To have experience in personal selling  Sales managers generally work with outside salespeople  Thus it is very important to have outside sales experience  Sales teams can sense inexperienced managers  In fact we can all sense that in managers no matter what the situation

 The sales force is directly responsible for generating sales revenue  Morale and success of a firm’s sales force depend on:  Exceptional management  Adequate compensation  Room for advancement  Sufficient and continual training  Top management support Managing the Sales Force

Suggestions for Attracting and Retaining a Top Sales Force

 Sales objectives give a sales force direction and purpose and should be:  Stated in precise, measurable terms  Specific about time periods and geography  Objectives are established for:  Entire sales force - Sales volume, market share, profit  Individuals - Dollars or unit sales volume Establishing Sales Force Objectives

 Divide the number of sales calls per year by the average number of individual salesperson’s calls annually  Marginal analysis - Additional salespeople are added to the sales force until the cost of an additional salesperson equals the additional sales generated by that person Methods to Determine Sales Force Size

 Recruiting: Process by which the sales manager develops a list of qualified applicants for sales positions  Sources of recruitment  Departments within the firm  Other firms  Employment agencies  Universities  Recruitment should be continuous and systematic Recruiting and Selecting Salespeople

As a manager of any type...  You need to know how to recruit  You need to know how to interview  Professional interviewing skills don’t just come to you because you are now a manager  You must be consistent in your techniques, questions and selection criteria  Be careful to hire the right person for the job

 Training can be formal or informal and on-the-job  Training can be aimed at salespeople at all seniority and experience levels  Conducted in-house or by outside specialists  Sales training may be done:  In the field  At educational institutions  In company facilities  Online using web-based technology Training Sales Personnel

 Choice of methods and materials depends on:  Type and number of trainees (10 – 15)  Program content and complexity  Length and location  Size of the training budget  Number of trainers  Trainer’s expertise Training Sales Personnel

 Compensation should be flexible, equitable, and easy to administer  Characteristics of a good compensation plan  Gives sales management the desired level of control  Provides sales personnel with acceptable levels of income, freedom, and incentive  Should facilitate and encourage proper treatment of customers Compensating Salespeople

Paying a specified amount per time period, regardless of the selling effort Straight salary compensation plan Paying according to the amount of the sales in a given time period Straight commission compensation plan Paying a fixed salary plus commission based on sales volume Combination compensation plan Compensating Salespeople

Characteristics of Sales Force Compensation Methods

 Additional efforts beyond compensation are necessary for motivation  Managers must identify their employees’ needs and goals and strive to create a positive organizational climate  Incentives programs pay for themselves by making workers happier and more committed Motivating Salespeople

What People Want From Their Jobs? Job Related FactorsBosses’ Employees High Wages 1 5 Job Security 2 4 Promotion potential in company 3 7 Good working conditions 4 9 Interesting work assignments 5 6 Loyalty of supervisor to employees 6 8 Tactful discipline 7 10 Appreciation for work completed 8 1 Understanding of personal problems 9 3 Feeling of being in on things 10 2

 Factors to consider while deciding on territories  Size  Geographic shape  Routing  Scheduling  Creating sales territories  Create territories with measurable sales potential  Balance sales/earning potential and workload travelling throughout the territory Managing Sales Territories

 Routing and scheduling salespeople  Geographic size and share of sales territory  Number and distribution of customers  Some firms have salespeople make their own routes/schedules  Goal - To minimize nonselling times and travel expenses Managing Sales Territories

Trips or vacation packages are rewards that a high-performing salesperson might receive for surpassing his or her sales goals. Rewarding the Sales Force Some times these rewards won’t motivate staff and can back fire. Why?

Controlling and Evaluating Sales Force Performance  Information needed by managers  Salespersons’ call reports  Customer feedback and invoices  Dimensions used to measure performance are determined by sales objectives  Calls per day and cost per call  Average sales per customer and gross profit per customer  Actual sales versus sales potential  Number of new customer orders

Sales Management: Shaping Future Sales Leaders Sales Management

Managing Sales Force Is Important  Sales positions are hardest to fill  Sales consumes >20% of a firm’s revenue

$$$  Sales starting salaries are 20% higher than other marketing positions  Many CEOs get their start in sales  Sales managers earn more than managers in other areas  Sales jobs predicted to grow at a faster rate than other professions  Many sales people make more than their managers

From Sales Rep to Sales Manager  “Manager of people”  Sales success is poor predictor of success as sales manager  Most successful sales reps are eventually pressured to make the transition to sales mgmt “This is a decision that must be carefully analyzed because it’s not an easy transition to go from being a player to a coach.”

What Being a Sales Manager Means Coaching  Coaching salespeople so they can improve Developing  Developing strategies and delegating the responsibility for implementation to others Motivating  Figuring out how to motivate people, some who are older than you Convincing  Convincing others that what is right for the sales force is right for their departments, too

Establishing the Parameters of the Firm’s Strategy: The Mission Statement  Inspire the members of an organization  Give purpose to their actions  Guide their decision-making  Serve as a standard against which decisions can be weighed  Once the mission’s objectives are set, strategy can be created

Developing a Mission Statement At is most basic, the mission statement describes the overall purpose of the organization. If the organization elects to develop a vision statement before developing the mission statement, ask “Why does the image, the vision exist -- what is it’s purpose?” This purpose is often the same as the mission.

Bayer’s Mission Statement Bayer’s products and services are designed to benefit people and improve their quality of life. VALUES A will to succeed A passion for our stakeholders Integrity, openness and honesty Respect for people and nature Sustainability of our actions

What is your missions statement?  What is it that would define you as a person?  What makes you unique among others?  You should prepare a 30 second elevator speech? Why?  Secondly, what are your values?

Developing a Vision Statement 1. The vision statement includes vivid description of the organization as it effectively carries out its operations. 2. Developing a vision statement can be quick culture-specific, i.e., participants may use methods ranging from highly analytical and rational to highly creative and divergent, e.g., focused discussions, divergent experiences around daydreams, sharing stories, etc. Therefore, visit with the participants how they might like to arrive at description of their organizational vision.

Developing a Values Statement 1. Values represent the core priorities in the organization’s culture, including what drives members’ priorities and how they truly act in the organization, etc. Values are increasingly important in strategic planning. They often drive the intent and direction for “organic” planners. 2. Developing a values statement can be quick culture- specific, i.e., participants may use methods ranging from highly analytical and rational to highly creative and divergent, e.g., focused discussions, divergent experiences around daydreams, sharing stories, etc. Therefore, visit with the participants how they might like to arrive at description of their organizational values.

Sample Mission Statements  Everything we do is inspired by our enduring mission:  To Refresh the World... in body, mind, and spirit  To Inspire Moments of Optimism... through our brands and our actions  To Create Value and Make a Difference... everywhere we engage  The mission of Southwest Airlines is dedication to the highest quality of Customer Service delivered with a sense of warmth, friendliness, individual pride, and Company Spirit  Coca-Cola  Southwest Airlines

The Strategy Hierarchy  Corporate strategy encompasses plans and goals for the entire organization  Address questions such as what markets and sourcing options company should engage  Ex: hire sales force vs. use distributors  Ex: outsource mfg and focus internally on marketing  Business units create their plans to support corporate strategy

Corporate Strategy Marketing Strategy Sales Strategy The Strategy Hierarchy Executive / Board Level Middle Management Level Supervisory Level

Creating a Marketing Strategy Markets  What markets do we serve with what products? Relationships  What types of relationships do we form and with whom? Investment  What level of investment will be required, and how will we locate and allocate the needed resources? Objectives  What are the detailed objectives and action plans?

What Markets Do We Serve with What Products?  Find a sustainable Competitive Advantage  Can you think of examples of C.A.’s?  Need for expertise, technology or a patent

Product-Market Grid

What Types of Relationships Do We Form and with Whom?  Strategic plan considers network of relationships  Investors, potential investors, bankers  Suppliers  Personnel sources  Regulatory agencies  Relationship with customers is most important  A service advantage is often a function of the quality of relationships  Customers’ lifetime value is worth more than the average single purchase

Customer Relationship Management (CRM): Key Terms  CRM: identifying and grouping customers to best acquire, retain, and grow customers  Sales and marketing teams are responsible for CRM  Customer acquisition strategy: plan to obtain new customers  Customer retention strategy: plan designed to keep customers  Growth strategy: plan designed to increase sales to the same customers

Global Sales Management: Going Global to Achieve Growth  QuadRep’s expanding customers wanted local support in Singapore  QuadRep opened office in Singapore  Has since followed customers across the globe, opening offices in Malaysia, China, Taiwan, Thailand, the Philippines, and Mexico

Global Sales Management: Going Global to Achieve Growth  Empire Technical Group’s customers moved mfg and purchasing to Asia  ETG and several other companies formed a consortium and included Asian partners where Asia/Pacific resources were required  Became an opportunity to pursue contracts to build entire assemblies as well as parts  Morphed into international design and assembly house, controlling manufacturing of complete assemblies, turning “a $3 (part) sale to a $103 sale”

What Level of Investment Will Be Required, and How To Allocate the Needed Resources?  Money, human or social capital  Human capital decisions include:  Determining number of salespeople  What skills and experience they must have  What training they require  Other decisions include:  Whether to hire telephone prospectors or to outsource  Who handles customer service (a sales rep or a customer service rep)

What Are the Detailed Objectives and Action Plans?  SMART format for establishing objectives S pecific M easurable A chievable, yet challenging R ealistic T ime-based

Selling Approaches Problem Solving or Consultative  Identify and solve a client’s problems  Also called needs-satisfaction selling or problem/solution selling Affiliative  Based on the friendship between the salesperson and the individual buyer Transactional  Finish sale as quickly and as easily as possible  Key to success is making as many calls as possible to as many people as possible Enterprise  Business-to-business (B2B) concept  Based on not only person-to-person relationships but on company-to-company relationships

Selling Process vs. Selling Approach Selling ProcessSelling Approach Prospecting PresentingClosing Transactional Consultative Affiliative Enterprise

Sales Leaders

Sales Executive Plan  Devise sales plan to meet strategic objectives  Develop general strategies that specify sales approach Organize  Determine type of sales force  Create hiring and training policies and strategies Implement  Communicate and roll out the plan  Create the right culture  Choose a compensation model Monitor  Sales and customer satisfaction  Salesperson recruitment, selection, training  Take corrective action as necessary

Field Sales Manager  Plans, organizes, implements, and monitors for specific sales team  Salespeople report to Field Sales Manager  Primary responsibility is sales quota  Responsible for training and motivating salespeople

Sales Executive vs. Sales Manager Duties ActivitySales ExecutiveSales Manager Plan Set overall sales targets for each product Set quotas for each salesperson for each product Organize Decide what type of people to hire for sales positions Interview and hire specific people for sales positions Implement Determine the compensation plan Identify each person’s motivators and find ways to reward good performance for each person Monitor Track sales by region; take corrective action such as additional training if sales are too low Observe each salesperson’s actions in the field and offer suggestions for their improvement

Ethics in Sales Management: Maintaining NCR’s Ethical Sales Culture We … recognize that selling only works when everything is right for the customer—when we deliver value —Rick Makos President, NCR-Canada