TM 1-2 (Fig. 1-2) Types of Sales Jobs Driver sales person Sales maintenance Inside order-taker Outside order-taker Missionary sales person Sales support Sales engineer/consultant Consultative sales person: tangible products Sales development Consultative sales person: services and other intangible products
Selected Activities of Salespeople TM 1-3 (Fig. 1-3)
TM 1-4 Sales Jobs are Different than Other Jobs • Salespeople are largely responsible for implementing a firm’s marketing • strategies in the field. • Salespeople represent their company to customers. • Salespeople represent their customers to their company. • Salespeople operate with little or no direct supervision. • Salespeople are alone a large part of the time. • A sales person needs more tact and social intelligence than other • employees on the same level in the organization. • Sales people are among the few employees authorized to spend company • funds. • Sales jobs frequently require considerable travel and time away from • home and family. • Salespeople are responsible for revenue generation.
TM 1-6a Managing is a distinct activity which requires a unique set of skills, knowledge, and attitudes
TM 1-6b Some skills are the same; many are different • motivating • planning • training • delegating • recruiting • administration
The Executive Ladder in Personal Selling TM 1-7 (FIG. 1-6) President Vice president of sales National sales manager Regional/divisional sales manager Districtsales manager Sales supervisor Staff assistants available for advice and support at any step along the ladder Sales person
TM 1-8 FIG. 1-7 The Executive Ladder in Team Selling President Vice president of marketing Distribution logistics specialist Client-team leader Product engineer Customer sales/service representative
TM 1-9 Promotional Mix: Product Life Cycle, Type of Business and Product Product Manufacturers Wholesalers Retailers Life-Cycle Industrial Consumer All Products Durable Nondurable Introduction Personal selling Advertising Personal selling Personal selling Advertising Personal selling Advertising Sales promotion Personal selling Advertising Personal selling Personal selling Advertising Personal selling Sales promotion Sales promotion Growth Sales promotion Advertising Personal selling Sales promotion Personal selling Personal selling Advertising Advertising Sales promotion Sales promotion Sales promotion Maturity Personal selling Sales promotion Personal selling Personal selling Sales promotion Sales promotion Sales promotion Decline
A Company’s Complete Marketing System: A Framework of Internal Sources TM 2-1 (Fig. 2-1) Operating within a Set of External Forces Macroenvironmental forces: Demography Economic conditions Sociocultural factors Political-legal factors Technology Competition Company’s marketing mix: Product planning Price structure Distribution system Promotional activities Marketing inter-mediaries Marketing inter-mediaries Suppliers The market Nonmarketing resources in the firm: Production Financial Personnel Public image Research and Development Location
Company Organization Chart Embracing the Concept of Marketing Management TM 2-2 (Fig. 2-3) President Production Manager Marketing Manager Financial Manager Personnel Manager Manager of Marketing Planning and Facilitating Staff Services Chief Sales Force Manager Management of field Advertising Sales promotion Marketing research Sales training Sales analysis and control (sales statistics) Sales budgeting Sales forecasting Planning for channels, territories, and quotas Product planning Inventory control Production scheduling Physical distribution sales organization activities including customer service and product service Management of sales office
Strategic Planning for the Total Company TM 2-3 Organization’s mission top Broad goals down Strategy and tactics to achieve goals
Relationship Between Objectives, Strategies and Tactics TM 2-4 (Fig. 2-4) Set Goals Formulate Strategies Develop Tactics
TM 2-5 Relationship Marketing • Long-term commitment • Understanding customer expectations • Building service partnerships • Empowering employees • Total quality management
TM 2-6 Company Strategy-Marketing Goals and Strategy Company Marketing Goals Earn 20% ROI Strategy Goals Increase market Increase marketing share 10% share 10% Strategy Increase share of customer business
TM 2-7 Marketing Strategy-Sales Force Goals, Strategy and Tactics Marketing share 10% Goals Increase market Sales Force Strategy Goals Increase share of customer business Increase share of customer business Strategy Build long-term customer relations Tactics Develop sales teams Provide bonuses for greater customer share
Multiple relationship strategies TM 2-8 (FIG. 2-5) High Partnership Commitment to the customer Relationship oriented Transaction oriented Low High Low Cost of serving the customer
TM 3-1 FIG. 3-1 Salesperson’s Average Time Allocation* (5.3 hrs) 18% (8.5 hrs) 18% (7.2 hrs) 15% (11.6 hrs) 25% (14.3 hrs) 31% *SOURCE: Christem P. Herde, Dartnell’s 29th Sales Force Compensation Survey 1996-1997, (The Dartnell Press: Chicago, IL), p. 177.
TM 3-2 THE EIGHT STEPS OF THE SALES PROCESS Follow-up Gaining Commitment Meeting objections Presentation Need Assessment Approach Preapproach Prospecting
TM 3-3 FIG. 3-2 Lead Conversion Ratio: Inquiry to Decision 12 Months After Inquiring Plan to buy 25% Purchased 45% No longer in market 30% *SOURCE: Bob Donath, James K. Obermayer, Carolyn K. Dixon, and Richard A. Crocker, “When Your Prospect Calls,” Marketing Management, Vol. 3, No. 2, 1994.
TM 3-4 (FIG. 3-3) The Value of Inquiry Follow-Up Share of buyer’s business if not followed up 40% Share of buyer’s business if followed up 83% Source: Bob Donath, James K. Obermayer, Carolyn K. Dixon, and Richard A. Crocker, “When Your Prospect Calls,” Marketing Management, Vol. 3, No. 2, 1994
Buying Center Members TM 3-5 Type of influence Job position Influence description User Production line workers and Use the product in the their supervisors production process Influencer Engineers, research & Write specifications; supply development specialists information Gatekeepers Purchasing agents, reception- Limit access to others and ists, secretaries, research control the flow of assistants information to others Deciders Purchasing agents (small or Make actual choice between reorder items), management suppliers Buyers Purchasing agents Formally give the order to a supplier; arrange terms of sale
NEED ASSESSMENT TM 3-6 • Situational questions • How often do you change the cutting oil in your drill presses? • In addition to the hospital administrator, who else has an influence on the decision? • Problem discovery questions • Have you experienced any delays in getting repair parts? • In which part of the production process is quality control the most important. • Problem Impact questions • How do these delays in getting parts affect your production costs? • What impact do the quality consistency problems have on your production costs? • Solution value question • If your inventories could be reduced by 20%, how much would that save you? • If your rejection rate on final inspection was reduced to under one percent, how much would • Confirmatory questions • So, you wold be interested in an inventory control system that reduced your inventories by 20%? • If I can provide evidence to you that our products would lower your rejection rate to under one • percent, would you be interested? that save you?
Presentation of Product, Features, Benefits, Advantages TM 3-7 Product FeaturesBenefits Advantages Camera Telephoto lens Take pictures Able to capture from longer images of animals distances. or people from a distance. Bicycle Attached water Can hold a water Don’t get dehydrated. bottle holder bottle. Don’t have to stop for water. Feel more refreshed. Drill Press Multiple drill Can change bits Saves time. bits attached without shutting Saves money. down the machine. Motor Oil Rust inhibitor Oil and engine Saves money. have longer life.
TM 4-1 Characteristics of a Good Organizational Design Market orientation Effective informal organization Activities organized Organizational Design Balanced and coordinated activities Authority and responsibility aligned Stable, but flexible Responsible span of control
Geographical Organization TM 4-2 (Fig. 4-5) Chief Marketing Executive Sales Promotion Manager General Sales Manager Marketing Research Manager Advertising Manager Sales Analyst Western Regional Sales Manager Eastern Regional Sales Manager 4 District Sales Managers 4 District Sales Managers Salespeople each with own territory Salespeople each with own territory
Sales Organization with Product Specialized Sales Force TM 4-3 (Fig. 4-6) Chief Marketing Executive Marketing Research Manager General Sales Manager Sales Promotion Manager Customer Relations Manager Advertising Manager Sales Manager Product A Sales Manager Product B Sales Manager Product C Salespeople Product A Salespeople Product B Salespeople Product C
Sales Organization Specialized by Type of Customers TM 4-4 (Fig. 4-8) Chief Marketing Executive Sales Promotion Manager General Sales Manager Director of Marketing Research Advertising Manager Sales Manager Transportation Industry Sales Manager Petroleum Industry Sales Manager Steel Industry Salespeople Salespeople Salespeople
TM 4-5 The Relationship Between a Sales Team and a Buying Center Selling firm Buying firm Sales Team Exchange processes Purchasing agent Organizational buying center Salesperson Marketing Sales Manufacturing R&D Engineering Physical distribution Purchasing Manufacturing R&D Engineering Marketing Information Problem Solving Negotiation Friendship,trust Product/services Payment Reciprocity
TM 4-6 • Uses of Telemarketing • Identify prospective customers • Screening, qualifying leads • Sales solicitation: small customers, re-orders • Order processing • Product service support • Account management • Customer relations
TM 5-1 RECRUITING AND SELECTION PROBLEMS • Lack of resources • Lack of job specification and qualifications • Qualifications not objectively established • Lack of managerial training • Personal prejudices • Search for managerial talent
TM 5-2 KEY LAWS AND REGULATIONS AFFECTING A SALES FORCE • Civil Rights Act of 1964 • Federal Contract Compliance, Executive Orders • Age Discrimination in Employment Act (1967) • Fair Employment Opportunity Act (1972) • Rehabilitation Act of 1973 • Vietnam Era Veterans Readjustment Act (1974) • Uniform Guidelines on Employment Selection Procedures (1978) • Americans with Disabilities Act (1990)
TM 5-3 (Fig. 5.2) Sales Force Staffing Process Plan for Recruiting & Selection Determine Number of People Wanted Establish Responsibility for Recruiting, Selection and Assimilation Conduct Job Analysis Prepare Job Description Determine Hiring Qualifications Recruit Applicants Select Applicants Design a System For Measuring Applicants Measure Applicants Against Hiring Qualifications Make Selection Decisions Hire The People Assimilate New People Into Sales Force
TM 5-4 Workload Analysis Number of reps needed Total workload in market = Workload one rep can handle Market workload: Customer Number of Calls Total x = class accounts per year calls A 400 20 8,000 B 600 10 6,000 14,000 One rep’s workload: Calls/day x Selling days/week x Working weeks/year = Annual workload 5 x 5 x 50 = 1250 Number of reps needed 14,000 1250 = = 112 reps
TM 5-5 (Fig. 4-3) Determining the Number of Salespeople Needed Strategic Plans New - Eliminated/ + Promotions + Retirements + Terminations/ = Total new territories combined resignations reps needed territories Expansion MN and RI 2 promotions 2 retirements 1 termination into Texas. Territories expected expected expected reps needed Total new 4 - 1 + 2 + 2 + 1 = 8
TM 5-6 CONTENT OF THE JOB DESCRIPTION • Title • The nature of the product or service to be sold • Type of customers to be called on, • frequency of calls, and types of personnel to be contacted • Specific tasks and responsibilities to be • carried out • Organizational relationships • Mental and physical demands of the job • Environmental pressures and constraints • that might affect the job
TM 5-7 RECRUITING FOR THE TEAM • Willingness to share • Cooperative • Trusting • Empathetic • Accepting of others • Receptive to others ideas • Selflessness • Leadership skills
RECRUITING SOURCES OF SALES REPRESENTATIVES TM 5-8 Source Comment Referrals: Candidates and position are known to person making referral. Within company: Office and factory employees Company employees know the company and its products. Sales force leads Current salespeople know their job requirements and can possibly identify candidates who could be a good job match. Other Companies: Competitors Competitors know the customers and are familiar with your products. Customers Customers know your products and your company. Suppliers Suppliers know your company and your products. Educational institutions Primarily used when recruiting inexperienced people. Students are usually actively involved in a job search, and this provides an efficient place to screen large numbers of available candidates. Advertisements Produces the greatest number of candidates, but the average quality is sometimes lower. Employment agencies The agency is often more costly than other methods, but it will do a large part of the initial screening. Voluntary applicants These applicants are interested in your firm and probably possess a high degree of self-confidence, self-reliance, and initiative. Part-time workers These workers are easy to contact, readily available, and can work flexible hours. This is a good source for in-home selling.
TM 5-9 (Fig. 5-8) Recruiting Evaluation Matrix Evaluation Criteria Consistent with strategic planning? Percent retained after 3 years Rep’s per-formance after 2 yrs. Recruiting sources Number recruits Number hired Cost Frequency of use Within company: Sales force Other departments Other companies: Competitors Customers Noncompetitors Educational institutions Advertisements Employment agencies Voluntary applicants Women Minorities
TM 6-1 Salesperson Selection Tools References and credit reports Application blanks Psychological tests Organizational Design Personal interviews Assessment Centers
TM 6-2 Application Blank Information Personal Experience Physical Environmental Name Work Ability to perform Membership in job-related social and service Address & Phone Education physical activities organizations Health Outside interests Reason for seeking particular job Personal goals References
TM 6-4 Suggestions for Improving Interviewing Effectiveness • Have specific job specifications and qualifications clearly in mind • Establish specific interviewing objectives • Provide some degree of structure (guidelines, probing questions) • Allow adequate time • Be very familiar with application or resume information • Use standardized rating sheets after each interview • Use multiple interviews • Provide training and practice for the interviewers • Remember, the interview is an opportunity to learn more about the candidate as well as to sell your company
TM 7-1 Selection and Hiring are Not Synonymous COMPANY A DISLIKES ANN ANN DISLIKES COMPANY A NO OFFER EXTENDED COMPANY B LIKES ANN ANN DISLIKES COMPANY B OFFER EXTENDED, BUT NOT ACCEPTED COMPANY A LIKES ANN ANN LIKES COMPANY C OFFER EXTENDED & ACCEPTED
Details of the Job TM 7-2 (Fig. 7-2) Office practices Paycheck Company eating facilities Expense account For the new sales representative: Details of the job
TM 8-1 Phases of Developing and Conducting Sales Force Training Establish program objectives Identify who should be trained Training assessment Identify training needs and specific goals How much training is needed? Who should do the training? When should the training take place? Program design Where should training be done? Content of training Teaching methods used in training program Reinforcement Determine how training will be reinforced What outcomes will be evaluated? Evaluation What measures will be used?
Objectives of Sales Training Programs Increased Sales Productivity TM 8-2 (Fig. 8-3) Improved Self-Management Lower turnover Sales training program objectives Improve customer relations Improve morale Improved communica-tion
Examples of Specific Training Objectives Company orientation and Understand company goals and objectives administrative skills: Understand company selling philosophy Understand organizational structure Understand company policies and procedures Improve call reports Improve call patterns Improve time management Knowledge: Existing products - features, benefits, and applications New products - features, benefits, and applications Industry trends Competitive products - features, benefits, and applications Specific customer applications and problems Promotional programs Selling skills: Improve pre-call planning Improve prospecting methods Improve strategy selection Improve presentation skills Improve closing techniques Improve understanding of and handling objectives Improve customer sensitivity TM 8-3
TM 8-4 Who Should Train Sales People? Source Advantages Disadvantages Line executive Greater credibility Lack of time Clearer expectations Lack of teaching ability More thorough evaluation of candidates Staff trainer Greater time Additional expense More resources Lack of authority Better training skills Less credibility Outside specialist Greater specialization Additional expense and expertise Program content is not specific to company’s needs
TM 8-5 Training Content and Methods Matrix Lectures Discussion Demonstra- Programmed Interactive Audio On-the-Job Videos Bus. T.V. Role tion learning simulation cassettes Playing Company knowledge Product knowledge Market/Indus-try knowledge Selling skills Time Manage-ment * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
TM 9-1 MOTIVATION IS THE CHOICE OF AN INDIVIDUAL TO 1. Initiate action on a certain task … choice; 2. Expend a certain amount of effort on that task … intensity; 3. Persist in expending effort over a period of time … persistence. The amount of effort the sales person desires to expend on each activity associated with the job.