Sales Management

Associate Professor um Tribhuvan University
18. Jul 2018

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Sales Management

  1. Sales Management Dr. Gopal Thapa Tribhuvan University
  2. Sales Management • the planning, direction and control of selling personnel including recruiting, selecting, equipping, assigning, routing, supervising, paying and motivating as these tasks apply to personnel sales force AMA
  3. Sales Management • The process of planning, organizing, controlling, and evaluating, the activities of the sales force. Dictionary of Marketing
  4. Sales Management includes: • Defining desired corporate results. • Working with business partners to ensure goals of both organizations complement one another. • Determining the specific activities required to achieve company and partner objectives. • Implementing a compensation plan that motivates salespeople to achieve corporate objectives. • Providing needed training and coaching to enable salespeople to meet their goals. • Establishing appropriate monitoring systems to ensure activities are taking place. • Measuring results.
  5. Objectives of Sales Management • Sales volume • Contribution to profits • Continuing growth
  6. Sales Executives as Coordinator • Organization and coordination • Planning and coordination • Coordination with other elements of marketing program
  7. Coordination with other elements of marketing program • Advertising • Distribution Gaining distribution Obtaining dealer identification Reconciling business goals Sharing promotional risks
  8. Coordination and Implementation of overall marketing strategy • Coordination in timing and best sequence of execution of various phases. • Introduction of new brand requires policies, strategies and detailed plans. • All of them should be appropriate to the company’s marketing situation • Launching brand at the wrong time or faulty timing at any stage , kills or reduces the chances of success.
  9. Coordination and Implementation of overall marketing strategy • It is not enough for sales executives to know the techniques and problems of new-brand introduction • They must be capable of putting the plans into action, to implement them effectively.
  10. Sales Management and Control Type of Control Prime Responsibili ty Purpose of Control Approaches Annual plan control Top level managers To examine whether the planned results are being achieved - Sales analysis -Market shares analysis - Marketing expenses to sales ratio Profitability control Sales controller To examine where the company is making or losing money -Customer attitude -Tracking profitability by - Product territory - Market share -Trade channel - Order size - Sales audit
  11. Steps in Designing a Sales Control System • Objective setting • Designing different control levels • Designing a reporting system and a feedback system • Deciding tools and techniques of control • Variance analysis and reasons thereof
  12. Sales Management and Control • Sizing of the situation: by analyzing present, past and future – Where are we know? – How did we get there? – Where are we going? – How do we get there?
  13. Sales Management and Control • Setting quantitative performance standard • Gathering and processing data on actual performance. • Evaluating performance • Action to correct controllable variation • Adjusting for uncontrollable variation
  14. Sale Control • Informal sales control – Effective sales executives have their “fingers on the pulse of the business” – They have strange ability to detect situations that require attention – The larger the company , the harder it becomes to use fingertip control – As the business grow and becomes complex it demands formal control
  15. Sale Control • Formal control and written sales policies – A large organization not only has more complex problems than small organization but there is less chance that everyone will know what to do in every situation – The large organization needs written sales and marketing policies to ensure substantial uniformity of action – Written policies also conserve executive time
  16. Sales Control • Policy formulation and review – It indicates dynamics of executive control – Sales management reviews the original plan – Through successive revisions, policy initially based on inadequate data often become appropriate and good
  17. Sales Control • Budgetary control – Budgetary control represents an extension of control over sales volume to control over margins and expenses and hence over profit – Sales management can project individual profit and loss statement for such units as sales territories, product, marketing channels and classes of customers
  18. Sales control • Formal control over sales volume – Estimating how much of a product can be sold in a specified future period is a prerequisite both for planning and control – Sales volume performance is best appraised by comparing it with potential sales volume. – Sales forecast serves as a standard for evaluating sales performance
  19. Sales Control and Organization • Control depends on decentralization • In decentralized organization greater control is exercised by lower executives than in the centralized organization. • The higher up executives are in the organization, the more they deal with policy or control except top, situations falling outside the control limits are handed up to that executive who has authority to deal with them.
  20. Buyer Seller Dyads • The interaction between a buyer and a seller comprises a buyer-seller dyad. • It is the effectiveness of communication between the salesperson and the customer during the sales process decides the success of the sales call. • The seller can interact with the buyer by using various techniques. • The most important of them all, where both get an equal opportunity to express, is personal selling
  21. Personal Selling • The oral presentation of a company’s products, or services to one or more prospective purchasers for the purpose of making a sale. • It is the art of successfully persuading prospects or customers to buy products or services from which they can derive suitable benefit thereby increasing their total satisfaction, i.e., delight.
  22. Personal Selling & Salesmanship • Salesmanship is a seller initiated effort that provides prospective buyers with information and motivates them to make favourable decisions concerning the seller’s product or services. • Personal selling is a two-way communication involving individual and social behaviour. • It aims at bringing the right product to the right customer. It is used for creating product awareness, stimulating interest, developing brand preference, negotiating price, etc.
  23. Personal Selling & Salesmanship • Personal selling is used extensively in complex and highly technical products • It is used for selling to industrial consumers who may be having technical queries and want to purchase in bulk. • The increase in competition from foreign and domestic sources has increased the importance of personal selling.
  24. Personal Selling • The salesman acts as a catalyst and consultant to the customer by providing information and benefits of the products. • He also works out the details, manner and timing of giving physical possession to the customer. • Personal selling is basically used during the product launching stage when a firm cannot afford a large expenditure for advertising. • Personal selling is an integral part of communication mix. • It becomes important because it educates the consumer and makes him understand the special functions and attributes of the product.
  25. Personal Selling and Advertising • Personal selling involves an alive, immediate and interactive relationship building between two or more persons. • Each party is able to observe the other’s needs and characteristics at close hand and make immediate adjustment
  26. Personal Selling and Advertising • Personal selling permits plenty of relationships to spring up, ranging from a matter-of-fact selling relationship to deep personal friendship. • Effective sales representatives will normally keep their customers best interest at heart if they want to maintain long term relationship.
  27. Personal Selling and Advertising • Personal selling puts the buyer under some obligation for having listened to the sales talk. The buyer has the greater need to attend and respond, even if the response is a polite “thank you”. • A sales force represents a greater long term cost commitment than advertising. • Advertising can be turned on and off, but the size of sales force is much difficult to alter.
  28. Advantages of Personal Selling • Ability to close sales. • Ability to hold customer attention. • Immediate feedback and two-way communication. • Presentation is tailored to individual needs. • Ability to target customer precisely. • Ability to cultivate relationship. • Ability to get immediate action.
  29. Disadvantages of Personal Selling • High cost per contact. • Uncontrolled message and exaggeration • Not suitable for low involvement product • Unnecessary pressure to prospects • Inability to reach some customers effectively
  30. New Approaches in Selling Telemarketing Televised shopping E-marketing Kiosk marketing Catalog marketing Direct mail
  31. Diversities of Personal Selling Situations • Service Selling • Developmental Selling
  32. Service Selling • service selling aims to obtain orders from existing customers whose habits and patterns of thought are already conducive to the products. • This type of selling is less complex as the customers already know the brand. • Service selling also includes sales of newer or enhanced versions of products offered by the company
  33. Developmental Selling • Developmental selling aims at converting prospects into customers. • It attempts to create customers out of people who may not, view the company products favourably, be unaware of the company’s products, or are resistant to changing their present source of supply. • It is relatively tougher than service selling. It requires a lot of convincing before a customer finally agrees to buy the product.
  34. Service Selling • Inside Order Taker: • Delivery Salesperson • Route or Merchandising Salesperson • Missionary Salesperson • Technical Salesperson
  35. Developmental Selling • Creative salesperson of Tangibles • Creative Salesperson of Intangibles
  36. Is Selling Science or Art? • In a survey of 173 marketing executives: Art – 46% Science – 8% Art evolving into science – 46%
  37. AIDAS Theory • A – Attention • I – Interest • D – Desire • A – Action • S - Satisfaction
  38. AIDAS Theory • Based on art • Based upon experiential knowledge • Prospect’s mind passes through five successive mental states: Attention  Interest Desire Action Satisfaction
  39. AIDAS Theory • The prospect goes through these five stages consciously. • Sales presentation must lead the prospect through them in the right sequence if a sale is to result.