Marketing chapter 20a personal selling sales management

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 20-6SCOPE AND SIGNIFICANCE OF PERSONAL SELLING AND SALES MANAGEMENT • Nature of Personal Selling and Sales Management – Pers

PERSONAL SELLING AND

SALES MANAGEMENT

C HAPTER

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 20-3

AFTER READING THIS CHAPTER

YOU SHOULD BE ABLE TO:

1 Discuss the nature and scope of

personal selling and sales

AFTER READING THIS CHAPTER

YOU SHOULD BE ABLE TO:

4 Describe the major functions of

sales management.

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 20-6

SCOPE AND SIGNIFICANCE OF

PERSONAL SELLING AND SALES MANAGEMENT

• Nature of Personal Selling and Sales

Management

– Personal Selling – two-way flow of

communication between buyer and seller, often in

a face-to-face encounter, designed to influence a

person’s of group’s purchase decision

• Also occurs by telephone , through video teleconferencing, and the internet between buyers and sellers

SCOPE AND SIGNIFICANCE OF

PERSONAL SELLING AND SALES MANAGEMENT

• Nature of Personal Selling and Sales

Management

– Sales Management – planning the selling

program and implementing and controlling the

personal selling effort of the firm

• Tasks involved include: setting objectives;

organizing the sales force; recruiting, selecting, training, and compensating salespeople; and evaluating performance of individual

salespeople

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 20-6

SCOPE AND SIGNIFICANCE OF

PERSONAL SELLING AND SALES MANAGEMENT

• Selling Happens Almost

Everywhere

– “Everyone lives by selling

something”

FIGURE 20-1 Personal selling and sales

management quiz

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 20-8

SCOPE AND SIGNIFICANCE OF

PERSONAL SELLING AND SALES MANAGEMENT

• Creating Customer Value Through

Salespeople: Relationship and

Partnership Selling

• Personal Selling in Marketing

 Relationship Selling – long-term

 Partnership Selling (or Enterprise Selling)

FIGURE 20-A How salespeople create value

for customers

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 20-10

Salesperson in the Operating Room

Why does Medtronic do this?

Concept Check

1 What is personal selling?

A: Personal selling involves the

two-way flow of communication between

a buyer and seller, often in a

face-to-face encounter, designed to influence

a person’s or group’s purchase

decision.

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 20-12

Concept Check

2 What is involved in sales

management?

A: Sales management involves planning

the selling program and

implementing and controlling the

personal selling effort of the firm.

THE MANY FORMS OF PERSONAL SELLING

• Order Taking

 Outside Order Takers

 Inside Order Takers, Order Clerks,

or Salesclerks

 Inbound Telemarketing

• Order Getting

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 20-14

FIGURE 20-B Comparing order takers with

order getters

FIGURE 20-2 How outside order-getting

salespeople spend their time each week

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 20-17

THE MANY FORMS OF PERSONAL SELLING

• Customer Sales Support Personnel

 Missionary Salespeople – promotion and introduction

 Team Selling – team of professionals (cross-functional)

 Conference Selling – discuss problems and opportunities

 Sales Engineer – identifying, analyzing & solving

 Seminar Selling – conducts educational program for

technical staff

MARKETING NEWSNET

Creating and Sustaining Customer Value

through Cross-Functional

Team Selling

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 20-19

Concept Check

1 What is the principal difference between

an order taker and an order getter?

A: An order taker processes routine orders or

reorders for products that were already sold by

the company An order getter sells in a

conventional sense and identifies prospective

customers, provides customers with

information, persuades customers to buy, closes

sales, and follows up on their use of a product

or service

Concept Check

2 What is team selling?

A: Team selling uses an entire team of

professionals in selling to and

servicing major customers.

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 20-21

THE PERSONAL SELLING PROCESS:

FIGURE 20-C Stages in the personal selling

process

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 20-22

FIGURE 20-3 Stages and objectives of the

personal selling process

THE PERSONAL SELLING PROCESS:

BUILDING RELATIONSHIPS

• Prospecting – search for and qualification

of potential customers

 Lead – name who may be possible customer

 Qualified Prospect – want, money, and authority to buy

 Cold Canvassing

 Prospect – customer who wants or needs product

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 20-25

THE PERSONAL SELLING PROCESS:

BUILDING RELATIONSHIPS

• Preapproach – obtaining further

information about prospect and deciding best

method of approach

• Approach – initial meeting between

salesperson and prospect

An American Salesperson and

Japanese Customer

In the approach stage, what issues to address?

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 20-27

THE PERSONAL SELLING PROCESS:

• Formula Selling Presentation

• Canned Selling Presentation

• The four sales presentation methods are:

– Memorized

– Formula

– Need-satisfaction

– Problem-solution

• The basic difference between the four methods

is the percentage of the conversation

controlled by the salesperson

SALES PRESENTATION METHODS –

SELECT ONE CAREFULLY

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin

• Four Sales Presentation Methods

1 The Memorized Sales Presentation (canned)

• Salesperson’s role is to develop initial stimulus into an affirmative response to an eventual

purchase request.

2 The Formula Presentation (persuasive selling)

• The salesperson follows a less structured,

general outline in making a presentation, allowing more flexibility and less direction (AIDA) Controls conversation during sales talk; especially at the beginning.

SALES PRESENTATION METHODS –

SELECT ONE CAREFULLY

3.The Need-Satisfaction Presentation

• Designed as a flexible, interactive sales presentation, yet the most challenging and creative form of selling

• Need-development phase

• Need-awareness phase

SALES PRESENTATION METHODS –

SELECT ONE CAREFULLY

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin

4.The Problem-Solution Presentation

• Selling highly complex or technical

products

• It may take several sales calls to

develop a detailed analysis

• A flexible, customized approach to

involving an in-depth study of a

prospect’s needs

SALES PRESENTATION METHODS –

SELECT ONE CAREFULLY

A Salesperson and Customer

What type of presentation format and why use it?

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 20-30

THE PERSONAL SELLING PROCESS:

• Agree and Neutralize

• Accept the Objection

• Ignore the Objection

THE PERSONAL SELLING PROCESS:

BUILDING RELATIONSHIPS

• Close – obtaining purchase

commitment  Trial Close

 Assumptive Close

 Urgency Close

 Final Close

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 20-34

Concept Check

1 What are the six stages in the

personal selling process?

A: The six stages in the personal

selling process are: (1) prospecting,

(2) preapproach, (3) approach,

(4) presentation, (5) close, and

(6) follow-up.

Concept Check

2 What is the distinction between a lead

and a qualified prospect?

A: A lead is the name of a person who

may be a possible customer whereas

a qualified prospect is an individual

wants the product, can afford to buy

it, and is the decision maker.

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 20-36

Concept Check

3 Which presentation format is most

consistent with the marketing

concept? Why?

A: The need-satisfaction presentation format

probing and listening by the salesperson to

identify needs and interests of prospective

buyers and then tailors the presentation to the

prospect and highlights product benefits,

consistent with the marketing concept.

FIGURE 20-4 The sales management

process

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 20-37

THE SALES MANAGEMENT PROCESS

– Sales Plan – Statement describing what is to

be achieved and where and how the selling

effort of salespeople is to be employed

– Setting Objectives – specifies what is to be

achieved for the total sales force and each

salesperson

ETHICS AND SOCIAL

RESPONSIBILITY ALERT

The Ethics of Asking Customers

About Competitors

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 20-37

THE SALES MANAGEMENT PROCESS

• Sales Plan Formulation: Setting Objectives

– Output-related – focuses on dollar or unit sales

volume, number of new customers, and profit

– Input-related – emphasizes the number of sales calls

and selling expenses

– Behaviorally-related – focuses on product knowledge, customer service, and selling and communication skills

THE SALES MANAGEMENT PROCESS

• Sales Plan Formulation: Setting Objectives

– Firms emphasize knowledge of competition as an

objective

– Objectives should be precise and measurable and

specify time period over which they are achieved

– Objectives should serve as performance standards for

the evaluation of the sales force

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 20-37

THE SALES MANAGEMENT PROCESS

• Sales Plan Formulation: Organizing the

Sales Force

 Own Sales Force vs Independent Agents

 Organized according to:

• Geography – simplest: regions, districts, territories

• Customer Type – different buyers have different

needs Variation: Major Account Management

• Product/Service – specific knowledge required

FIGURE 20-6 Organizing the salesforce by

customer, product, and geography

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 20-44

FIGURE 20-6A Organizing the salesforce by

geography

FIGURE 20-6B Organizing the salesforce by

customer

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 20-46

FIGURE 20-6C Organizing the salesforce by

product

THE SALES MANAGEMENT PROCESS

• Sales Plan Formulation: Setting

Direction  Organizing the Salesforce—Size

• Workload Method

• Developing Account Management Policies

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 20-48

FIGURE 20-7 Account management policy

grid grouping customers according to the

level of opportunity and a firm’s competitive

sales position

FIGURE 20-4 The sales management

process

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 20-49

THE SALES MANAGEMENT PROCESS

• Sales Plan Implementation: Putting the

Plan into Action

 Salesforce Recruitment and Selection

• Job Analysis

• Job Description

• Emotional Intelligence

 Salesforce Training

FIGURE 20-8 U.S sales force composition

and change

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 20-52

FIGURE 20-8A U.S sales force composition

and change

FIGURE 20-8B U.S sales force composition

and change

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 20-54

FIGURE 20-8C U.S sales force composition

and change

THE SALES MANAGEMENT PROCESS

• Sales Plan Implementation: Putting

the Plan into Action

 Salesforce Motivation and Compensation

• Straight Salary Compensation Plan

• Straight Commission Compensation Plan

• Combination Compensation Plan

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 20-56

Mary Kay Cosmetics Annual Sales Meeting

Why use nonmonetary compensation?

FIGURE 20-4 The sales management

process

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 20-57

THE SALES MANAGEMENT PROCESS

• Salesforce Evaluation and Control:

Measuring Results

 Quantitative Assessments

• Sales Quota

 Behavioral Evaluation

THE SALES MANAGEMENT PROCESS

• Salesforce Automation and

Customer Relationship Management

 Salesforce Automation (SFA)

 Salesforce Computerization

 Salesforce Communication

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 20-61

Concept Check

1 What are the three types of selling

objectives?

A: They are: (1) output-related (dollars or

unit sales, new customers, profit);

(2) input-related (sales calls, selling

expenses); and (3) behavioral-related

(product knowledge, customer service,

selling and communication skills).

Concept Check

2 What three factors are used to

structure sales organizations?

A: geography, customer, and product or

service

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 20-63

Concept Check

3 How does emotional intelligence tie

to adaptive selling?

A: Emotional intelligence is the ability

to understand one’s own emotions

and the emotions of people with

whom one interacts on a daily basis,

qualities that are important for

adaptive selling.

Personal Selling

Personal selling involves the two-way

flow of communication between a buyer

and seller, designed to influence a

person’s or group’s purchase decision,

usually in face-to-face communication

between the sender and receiver.

Personal selling involves the two-way

flow of communication between a buyer

and seller, designed to influence a

person’s or group’s purchase decision,

usually in face-to-face communication

between the sender and receiver.

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 20-83

Sales Management

Sales management involves planning

the selling program and implementing and

controlling the personal selling effort of

the firm.

Sales management involves planning

the selling program and implementing and

controlling the personal selling effort of

the firm.

Relationship Selling

Relationship selling is the practice of

building ties to customers based on a

salesperson’s attention and commitment

to customer needs over time.

Relationship selling is the practice of

building ties to customers based on a

salesperson’s attention and commitment

to customer needs over time.

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 20-85

Partnership Selling

Partnership selling is the practice

whereby buyers and sellers combine their

expertise and resources to create

customized solutions, commit to joint

planning, and share customer,

competitive, and company information for

their mutual benefit, and ultimately the

customer Also called enterprise selling.

Partnership selling is the practice

whereby buyers and sellers combine their

expertise and resources to create

customized solutions, commit to joint

planning, and share customer,

competitive, and company information for

their mutual benefit, and ultimately the

customer Also called enterprise selling.

Order Taker

An order taker processes routine orders

or reorders for products that were already

sold by the company.

An order taker processes routine orders

or reorders for products that were already

sold by the company.

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 20-87

Order Getter

An order getter sells in a conventional

sense and identifies prospective

customers, provides customers with

information, persuades customers to buy,

closes sales, and follows up on customers’

use of a product or service.

An order getter sells in a conventional

sense and identifies prospective

customers, provides customers with

information, persuades customers to buy,

closes sales, and follows up on customers’

use of a product or service.