Transcript Managing the Sales Force

Chapter 17
Managing the
Sales Force
PowerPoint by Karen E. James
Louisiana State University - Shreveport
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 0 in Chapter 17
Objectives
 Review the types of decisions firms
face in designing a sales force.
 Learn how companies recruit, select,
train, supervise, motivate, and evaluate
a sales force.
 Understand how salespeople improve
their selling, negotiation, and
relationship-building skills.
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 1 in Chapter 17
Designing the Sales Force
Types of Sales Representatives
Deliverer
Order taker
Missionary
Technician
Demand creator
Solution vender
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 2 in Chapter 17
Designing the Sales Force
Figure 17-1:
Designing a Sales Force
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 3 in Chapter 17
Designing the Sales Force
Steps in Process
 Objectives and
strategy
 Objectives
– Sales volume and
profitability
– Customer
satisfaction
 Structure
 Strategy
 Sales force size
 Type of sales force
 Compensation
©2003 Prentice Hall, Inc.
– Account manager
– Direct (company) or
contractual
To accompany A Framework for Marketing Management, 2nd Edition
Slide 4 in Chapter 17
Designing the Sales Force
Steps in Process
 Objectives and
strategy
 Structure
 Sales force size
 Compensation
©2003 Prentice Hall, Inc.
 Types of sales
force structures:
– Territorial
– Product
– Market
– Complex
 Key accounts
To accompany A Framework for Marketing Management, 2nd Edition
Slide 5 in Chapter 17
Discussion Scenario
Ariel Jones has tremendously increased the
number of accounts and the dollar value of
sales within her territory. She’s so busy
servicing existing accounts that she has little
time to seek new business. Management has
decided to “split” her territory by giving 50%
of her existing client base to a new sales rep.
What are the pros and cons of this strategy?
Can it be implemented in a manner that
minimizes potential negative consequences?
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 6 in Chapter 17
Designing the Sales Force
Steps in Process
 Objectives and
strategy
 Structure
 Sales force size
 Compensation
©2003 Prentice Hall, Inc.
 Workload approach:
– Group customers by
volume
– Establish call
frequencies
– Calculate total yearly
sales call workload
– Calculate average
number of calls/year
– Calculate number of
sales representatives
To accompany A Framework for Marketing Management, 2nd Edition
Slide 7 in Chapter 17
Designing the Sales Force
Steps in Process
 Objectives and
strategy
 Structure
 Sales force size
 Compensation
©2003 Prentice Hall, Inc.
 Four components of
compensation:
–
–
–
–
Fixed amount
Variable amount
Expense allowances
Benefits
 Compensation plans
– Straight salary
– Straight commission
– Combination
To accompany A Framework for Marketing Management, 2nd Edition
Slide 8 in Chapter 17
Designing the Sales Force
Figure 17-2:
Managing the Sales Force
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 9 in Chapter 17
Managing the Sales Force
 Recruiting begins with the
development of selection criteria
– Customer desired traits
– Traits common to successful sales
representatives
 Selection criteria are publicized
 Various selection procedures are
used to evaluate candidates
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 10 in Chapter 17
Managing the Sales Force
Personality
testing is one
method of
screening
candidates.
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 11 in Chapter 17
Managing the Sales Force
Typical Training Topics
Company background
and products
Company
characteristics
Sales presentation
techniques
Training
Topics
Procedures and
responsibilities
Competitors’ products
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 12 in Chapter 17
Managing the Sales Force
Many firms
specialize in
sales force
training.
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 13 in Chapter 17
Managing the Sales Force
 The amount of time needed and the
training method used vary with the
level of task complexity.
 Successful firms have procedures to
aid in evaluating the sales force:
– Norms for customer calls
– Norms for prospect calls
– Using sales time efficiently
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 14 in Chapter 17
Managing the Sales Force
Using Sales Time Efficiently
Greater emphasis on
phone and Internet usage
Greater reliance on
inside sales force
Time-and-duty analysis
Configurator software
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 15 in Chapter 17
Managing the Sales Force
Configuator
software
packages
assist in
complex
pricing tasks.
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 16 in Chapter 17
Managing the Sales Force
 Motivating the Sales Force
– Most valued rewards
• Pay, promotion, personal growth, sense
of accomplishment
– Least valued rewards
• Liking and respect, security, recognition
– Sales quotas as motivation tools
– Supplementary motivators
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 17 in Chapter 17
Managing the Sales Force
 Evaluating the Sales Force
– Various sources of information
may be used
– Types of formal evaluation include:
• Performance comparisons
• Knowledge assessments
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 18 in Chapter 17
Managing the Sales Force
Sources of Information When
Evaluating the Sales Force
Call Reports
Customer Surveys
Personal Observation
Other Sales Representatives
Customer Letters/Complaints
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 19 in Chapter 17
Personal Selling Principles
Figure 17-3:
Managing the Sales Force: Improving Effectiveness
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 20 in Chapter 17
Personal Selling Principles
Major Aspects
 Sales
professionalism
 Negotiation
 Relationship
marketing
©2003 Prentice Hall, Inc.
 Sales-oriented
approach
– Stresses high
pressure techniques
 Customer-oriented
approach
– Stresses customer
problem solving
 Steps in industrial
selling process
To accompany A Framework for Marketing Management, 2nd Edition
Slide 21 in Chapter 17
Personal Selling Principles
Figure 17-4:
Major Steps in Effective Selling
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 22 in Chapter 17
Personal Selling Principles
Major Aspects
 Reps need skills for
effective negotiation
 Sales
professionalism
 Negotiation is useful
when certain factors
characterize the sale
 Negotiation
 Negotiation strategy
 Relationship
marketing
©2003 Prentice Hall, Inc.
– Principled
– BATNA
To accompany A Framework for Marketing Management, 2nd Edition
Slide 23 in Chapter 17
Personal Selling Principles
Major Aspects
 Sales
professionalism
 Negotiation
 Relationship
marketing
©2003 Prentice Hall, Inc.
 Building long-term
supplier-customer
relationships has
grown in importance
 Companies are
shifting focus away
from transaction
marketing to
relationship
marketing
To accompany A Framework for Marketing Management, 2nd Edition
Slide 24 in Chapter 17
Discussion Scenario
Salespeople who meet or exceed their
assigned quotas are typically given
higher quotas the following year.
How might this practice impact a
company’s 1) internal marketing
efforts with employees, and 2)
relationship marketing efforts with
external customers?
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 25 in Chapter 17