2. Personal Selling, Relationship Building, and Sales Management
Chapter 9
Personal Selling, Relationship Building, and Sales Management
Key Terms
Information Provision, Persuasion, After-sale Service, Prospecting, Random Lead Generation, Lead, Selected-lead Searching, Planning the Sales Call, Presenting, Responding to Objections, Obtaining Commitment, Long-term Relationship, Functional Relationships, Strategic Alliances, Missionary Salespeople, Technical Sales Specialist, Cross-functional Sales Team, Sales Force Organization, Forecasting Sales, Sales Territories and Quotas, Salary, Commission

3. Personal Selling – Definition
Defined as a two-way flow of communication between a potential buyer and a salesperson
Use of personal selling depends partially on the nature of product
Key role played by salesperson in providing information about product
Use personal selling when products are
New and different
Technically complex
Expensive and require negotiation

4. Sales Process Refers to two basic factors
The objectives the salesperson is trying to achieve while engaged in selling activities
The sequence of stages or steps the salesperson should follow to achieve the objectives (relationship-building process)

5. Sales Force Objectives
Information provision
Persuasion
After-sale service

6. The Sales Relationship-Building Process

7. The Evolution of Personal Selling

8. Prospecting – Locating Potential Customers
Lead – A candidate to whom a sale can be made – target of prospecting process
Random lead generation – Mass appeals that require a high number of contacts to generate qualified leads
Selected-lead searching – Uses existing contact to generate new ones – often called referrals

9. Prospecting – A Screening Process
Does the lead have a want or need that can be satisfied by the purchase of the firm’s products or services?
Does the lead have the ability to pay?
Does the lead have the authority to pay?
Can the lead be approached favorably?
Is the lead eligible to buy?

10. Common Sources of Sales Leads

11. Planning the Sales Call
Thorough knowledge of representative company, including past history
Thorough knowledge of products and product lines
Good working knowledge of competitor’s products and product line
In-depth knowledge of the market for their merchandise
Accurate knowledge of buyer, or prospect

12. Presenting Be well prepared and set a goal for your presentation
Develop a checklist of items for discussion
Development of good interpersonal skills
Adapt your style to the prospect

13. Overcoming Objections
Expect objections to occur at any time
During efforts to secure appointments
During the presentation and subsequent relationship
During attempts to obtain a commitment
During the after-sale follow-up
In response to an objection, a sales person should not challenge the customer
Make the necessary presentation in order to help the client make an intelligent decision

14. Obtaining Commitment Important to know how and when to close a sale
Not all sales end in a successful closing – Salespeople should analyze the reasons and determine whether
More sales calls are necessary to obtain commitment
Currently, there just does not exist a good match between customer needs and seller offerings

15. Building Long-Term Relationships
After-marketing activities include
Establishing and maintaining a customer information file
Monitoring order processing
Ensuring initial proper use of product or service
Providing customers ongoing guidance and support
Analyzing customer feedback and responding quickly to questions and complaints
Continually conducting customer satisfaction research and responding to it

16. Relationships Can Lead to Partnerships
Functional relationships – When a buyer and a salesperson has a problem, they work together to solve it
Strategic relationships (strategic alliances) – Long-term, formal relationships in which both parties make significant commitments and investments in each other in order to pursue mutual goals and to improve the profitability of each other

17. People Who Support the Sales Force
Missionary salespeople – Focus solely on promoting existing products and introduction of new products (e.g.: pharmaceuticals)
Technical sales specialists – Support the sales staff by providing training or other technical assistance
Cross-functional sales team – Increased in popularity since products increase in technical complexity, and units of the buying organization require specialized knowledge

18. Why Cross-Functional Sales Teams Are Growing in Popularity

19. Managing the Sales and Relationship-Building Process
Efficient and effective sales tools, continuous sales training, and adequate support from promotional tools
Efficient delivery and reorder system
Equitable compensation plan to reward and motivate performance, and promote company loyalty
Adequate supervision and evaluation of performance for continual improvement

20. Organizing the Sales Force

21. Sales Management Task – Sales Force Organization
Geographic structure – Provides practical benefit of limiting the distance each salesperson must travel
Product structure – Useful when sales force must have specific technical knowledge about products
Customer structure – Works best when different types of buyers have large or significantly different needs
Major account management – Use of team selling to focus on major customers to establish long-term relationships

22. Forecasting Sales
Estimate of how much of the company’s output, either in dollars or in units, can be sold during a specified future period under a proposed marketing plan and under an assumed set of economic conditions
Used to
Establish sales quotas
Plan the personal selling efforts and other types of promotional activities
Budget selling expenses
Plan and coordinate production, logistics, inventories, personnel, and so forth

23. Forecasting Methods
Jury of executive opinion method – Combines and averages views of top management from different departments
Sales force composite method – Sales force becomes the jury
Customer expectations method – Asks customer about the quantity they expect to purchase

24. Forecasting Methods
Time-series analysis – Analyzes past sales data and the impact of factors influencing sales
Correlation analysis – Measures relationship between dependent and independent variables
Other quantitative techniques – Growth functions and simulation models

25. Sales Territories and Quotas
Sales territories can be segmented on the bases of
Geography
Product specialization
Sales quotas
Provide incentives for salespeople
Provide a quantitative standard for performance measurement
Evaluate and control the efforts of the sales force
Activity quotas – Allows monitoring of whether salespersons are engaging in activities to the extent desired

26. Sales Territories and Quotas
Sales quotas represent specific sales goals assigned to each territory or unit over designated time period
Management needs to consider these key factors
All territories will not have equal potential and, hence, compensation must be adjusted
All salespeople will not have equal ability and assignments may have to be made accordingly
Sales task in each territory may differ from time period to time period
Analyzing expenses – Sales forecasts should include a sales expense budget

27. Effort- and Results-Oriented Measures for Evaluating Salespeople

28. Medi-test Company Sales Activity Evaluation

29. Motivating and Compensating Performance
Salary – Refers to a specific amount of monetary compensation at an agreed rate for definite time periods
Commission – Is monetary compensation provided for each unit of sales and expressed as a percentage of sales
May be computed on the bases of
Volume of sales in units of product
Gross sales in dollars
Net sales after returns
Sales volume in excess of a quota

30. Types of Incentives and Their Possible Performance Outcomes