Sales management,
personal selling and
salesmanship are all
related.
Sales management directs the personal selling effort, which in turn, is
implemented largely through salesmanship. The term personal selling and
salesmanship are often used without distinction. However, there are vital
differences between two terms. Personal selling is a broader concept than
salesmanship. Salesmanship is one of the aspects of personal selling.
Salesmanship is one of the skills used in personal selling, it is not all of
it. ‘Salesmanship is the art of successfully persuading prospects or customers
to buy products or services from which they can derive suitable benefits,
thereby increasing their total satisfaction’. Salesmanship is seller initiated
effort that provides prospective buyers with information, and motivates them to
make favourable decisions concerning the seller’s products or services.
‘Personal
Selling’ is a highly distinctive form of promotion. It is basically a two way
communication involving not only individual but social behaviour also. It aims
at bringing the right products to the right customers. It takes several forms
including calls by company’s sales representative, assistance by a sales clerk,
an informal invitation from one company executive to another. It is employed
for the purpose of
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creating
product awareness, stimulating interest, developing brand preference,
negotiating price etc.
The
increase in complexity of products has increased the importance of personal
selling. Manufacturers of highly technical products such as computers,
electronic typewriters, digital phones, microwave kitchen appliances, remote
control equipments etc. depend more heavily on personal selling than do grocery
or toiletry products manufacturers.
Ever
growing competition from domestic and foreign sources have also increased the
importance of sales persons in the marketing effort of a firm. In personal
selling, company’s sales persons are often referred to as sales representative,
salesman or sales girl, they remain on the company’s payroll or work on
commission basis or both to push the product in the market by positively
motivating the prospective customer through oral presentation or demonstrating
the product in question.
Consumers
want all sorts of goods and services but inertia may keep them from buying.
Sales efforts stimulate the consumption process by reducing people’s inherent
reluctance to make purchase decision. In fact sales person act as catalyst in
the market place. When the nature of the product is such that the buyer needs
special information in order to use it properly, sales representative acts as a
consultant to consumer, to apprise them of products technicalities and usage.
Sales person also work out the details of manner and timing of given physical
possession.
In
case of industrial products, the promotion mix mostly consist of personal selling
rather than advertising. Being high value and complex product, personal contact
with the customer is essential to convince him
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of the
product’s quality and utility. On the other hand, consumer product companies
use personal selling together with advertising, to influence prospect to try
their brand. But personal selling in this case cannot substitute for
advertising, it can only be used tactically to intensify marketing effort,
mainly because it is expensive.
PERSONAL SELLING OBJECTIVES
The qualitative personal selling objectives are long term
and concern the contribution management expects personal selling to make in
achieving long-term company objectives. These objectives generally are carried
over from one period’s promotional program to the next. Depending upon company
objectives and the promotional mix, personal selling may be assigned such
qualitative objectives as-
To do the entire selling job (as when there are no other
elements in the promotional mix).
To “service” existing accounts (that is, to maintain
contacts with present customers, take orders, and so forth).
To
search out and obtain new customers.
To secure and maintain customers’ cooperation in stocking
and promoting the product line.
To keep customers informed on changes in the product line
and other aspects of marketing strategy.
To assist customers in selling the product line (as
through “missionary selling”).
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To provide technical advice and assistance to customers
(as with complicated products and where products are especially designed to fit
buyers’ specializations).
To assist (or handle) the training of middlemen’s sales
personnel.
To provide advice and assistance to middlemen on
management problems.
To collect and report market information of interest and
use to company management.
The
basic considerations in setting qualitative personal selling objectives are
decisions on sales policies and personal selling strategies and their role in
the total promotional program. After this role is defined, qualitative long-term
personal selling objectives are set. In turn, the qualitative personal selling
objectives become the major determinants of the quantitative personal selling
objectives.
The
quantitative objectives assigned to personal selling are short term and are
adjusted from one promotional period to another. The sales volume objective-the
rupee or unit sales volume management sets as the target for the promotional
period-is the key quantitative objective. All other quantitative personal
selling objectives are derived from or are related to the sales volume
objective. Thus, discussion here focuses upon the setting of sales volume
objectives. Setting the sales volume objective influences the setting of other
quantitative personal selling objectives, among them the following:
To
capture and retain a certain market share.
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To obtain sales volume in ways that contribute to
profitability (for example, by selling the “optimum” mix of company products).
To
obtain some number of new accounts of given types.
To
keep personal selling expenses within set limits.
To
secure targeted percentages of certain accounts’ business.
RELEVANT SITUATION FOR PERSONAL
SELLING
Let us discuss some of the
situations when personal selling in a
company becomes more relevant.
Product
situation: Personal selling is relatively more effective and economical in case:
When a product is of a high unit value like Xeroxing
machine, computers etc.
When a product is in the introductory state of its life
cycle and require creation of core demand.
A product requires personal attention to match specific
consumer needs e.g. insurance policy.
Product requires demonstration e.g. most of the industrial
products.
Product
requires after-sales service.
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Product has no brand loyalty or very poor brand loyalty.
Market
situation: Personal selling situation can be best utilized when:
A company is selling to a small number of large-size
buyers.
A company sells in a small-local market or in government
or institutional market.
Desired
middle men or agents are not available.
An indirect channel or distribution is used for selling to
merchant-middlemen only.
Company
situation: Personal selling is relatively more effective and economical when:
The company is not in a position to identify and make use
of suitable non-personal communication media.
A company cannot afford to have a large and regular
advertising outlay.
Consumer
behaviour situation: Personal selling is more effective when:
Purchases
are valuable but infrequent.
Consumer
needs instant answers to his questions.
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Consumer requires persuasion and follow-up in the face of
competitive pressure.
DIVERSITY OF SELLING SITUATIONS
All of us being consumers often
come across variety of selling
situations.
Differences in marketing factors cause each company to have individualized
selling styles. Each different type of selling job requires the sales person to
perform a variety of different tasks and activities under different
circumstances. The job of a soft drink driver salesperson who calls in routine
fashion on a number of retail stores is different from that of a computer sales
person who sells a system for managing information to executive of a
consultancy firm.
Before
categorizing sales persons into basic selling styles, one convenient way to
classify the many different types of sales job is to array them on the basis of
the creative skill required in the job, from simple service-or repeat order
selling to the complex developmental selling. Let us now discuss the different
kinds of selling positions prevalent in Indian companies.
Delivery sales person: The primary job of the delivery
sales person is to deliver the
product e.g. soft drink, bread, milk etc. The selling responsibilities are
secondary. Good service and a pleasant personality may lead to more sales.
Inside order taker: The retail sales person standing
behind a counter is an inside order
taker. The customer comes to the sales person with the intention to buy a
product or service, the sales person only
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serves
him or her. The sales person may use suggestion selling but ordinarily cannot
do much more.
Outside order taker: The soap or spices sales person
calling on retailer is an outside
order taker. They do little creative selling. In contract with store personnel
these representatives actually may be discouraged from doing any hard selling.
That task is left to executives higher in the hierarchy.
Missionary sales people: These sales persons are not
expected or permitted to solicit an
order. Their job is to build goodwill or to educate actual or potential user or
provide services for the customers, as in the case of Medical representatives,
working for the pharmaceutical company.
Consultative sales person:
Consultative sales are characterized by the
product or service that is sold at the higher level of an organization e.g.
computer system or management consultancy service. The decision to purchase
such products involves higher capital outlay thus sales job requires a low key,
low pressure approach by the sales person. It would also require a very strong
knowledge about product, patience to discuss product with several people of
organization and potential benefits to the user. Even at times when the
progress of sales slows down representative has to make creative and sensitive
efforts to resume interest but without appearing to exert pressure on the
prospect.
Technical sales personnel: The
most distinctive characteristic of technical
sales is the product knowledge required by its sales person, unlike the
consultative sales, where sophistication in organization relationship and
persuasive ability are sales persons’ most valuable
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assets.
Even time required to sell the product is relatively less than consultative
sales.
Most
of the technical purchasing requires approval of several people but only one or
two people with technical knowledge influence decision. If the sales
representative is able to satisfy these people with product characteristics,
application, installation process, approval from higher management is usually
forthcoming. The technical sales persons though not strangers to the process of
making a sale, are trained to utilize the rational approach, by going into
details of product utility and features.
Commercial sales person: This field generally includes
non-technical sales to business, industry, government and non-profit
organization e.g. office equipment, wholesale goods, building products,
business services and others. Unlike the previous two types, it is customary
for the commercial sales person to make sales on first or second call. The
process stresses approach to right person (decision maker), making a smooth
presentation and closing the sales.
The
field is composed of order takers, to follow up and maintenance of accounts and
order getter, to develop new accounts. Since these require different
approaches, they normally require different personality traits e.g. the order
getter are more aggressive and more highly motivated.
Direct sales people: Direct sales are primarily
concerned with the sales of products
and services to ultimate consumers e.g. restaurants, door to door sales,
insurance, encyclopaedias, magazines etc. There is normally some emotional
appeal associated with this type of selling, thus
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sales
persons are required to possess strong persuasive ability. Often length of time
to close sales is shortest in the case of above product categories. In fact,
sales person are trained to close the sales on the first visit because it is
felt if consumers are given time, they will either cool off from buying or will
buy from competitor.
SELLING PROCESS
All selling process contain the same basic steps, though
the detail of each step and time required to complete it will vary according to
the product that is being sold. For example: a door to door sales
representative may go through all the steps from prospecting to closing of sale
in a matter of ten to fifteen minutes in contrast, the selling process for
computer or electronic typewriter may take several visits, even years, for
getting an order.
2.5.1Prospecting
The selling process begins with prospecting or finding
qualified potential customers. Except in retail selling, it is unlikely that
customers will come to the sales person. In order to sell the product, the
sales person must seek out potential customers, prospecting involves two major
activities-
identifying
potential customers also known as prospects; and
qualifying them in order to determine if they are valid
prospects.
Identifying
prospects
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The
identification of potential customers is not an easy job, especially for a new
sales person. Rejection rate is quite high and immediate payoffs are usually
minimal. In some consumer goods businesses, identification of prospects usually
come from friends and acquaintances, other sales people, former customers,
present customers etc. Few of the best sources and techniques for finding
prospects are discussed below.
Present customers: The best source of prospects is
usually the sales person’s existing
satisfied customers. It is much easier to sell additional goods and services to
existing customers than to attract new customers. Indian companies are using
this method of selling successfully. For example person or an organization who
has purchased a portable typewriter from an office automation product company
and is pleased with it is usually more receptive to purchase a bigger
typewriter and similar product from the same company than someone else. This is
the main reason, present customers should get first priority by the company
when new products and services are introduced.
Endless chain: This is also an effective
prospecting tactics. In this method
companies use satisfied customers as source of referrals. Sales representatives
ask current customers for names of friends or business associates who might
need similar products or services. Then, as the sales person contacts and sells
to these prospects, more referrals are solicited. In this way the process
continues further.
Centre of Influence: Another effective prospecting
technique based on referrals is the
center of influence approach. A center of influence is a person with
information about other people or influence
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over
them that can help a sales person identify good prospects. Some frequently used
centers of influences are housewives, bankers, local politicians etc.
Spotters: Some companies use spotters as a
source for prospecting potential
customers. Spotters are usually ‘sales trainees’ who help sales person
identifying prospects, thus saving time and qualifying sales lead.
Cold call: Cold call is also known as
unsolicited sales calls. This prospecting
techniques involves knocking on doors. The sales person makes contact with a
potential customers, introduces himself or herself, and asks if there is a use
for the product or service. This technique is utilized by the sales person when
they have time available between scheduled appointments.
Directories: A wide variety of directories
are full of prospect. The classified
telephone directory is the most obvious one. A sales person may also find that
membership directories of trade associations, professional societies, and civic
and social organizations are good sources for prospects.
Mailing lists: In India, specialized companies
compile lists of individuals and
organizations for direct mail advertisers. These lists may also be used to
identify sales prospects. The major advantages of mailing list are that they
are often more current and more selective than directories.
Trade shows and exhibitions: A
cost effective way to make personal
contacts and locate prospective buyer is to participate in trade shows and
exhibitions. Now a days more and more companies are
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increasing
their participation in these shows and exhibitions to company’s booth by
mailing invitations or promising a gift. Advance announcements sent to trade
publications may also help to attract prospects. In view of the rising costs of
personal selling trade shows have become an increasingly important source of
prospecting. India International Trade Fair organized by Trade Fair Authority
of India every year provides a good example of usage of trade shows for
prospecting.
Qualifying
prospects
Once
the sales person has identified potential customers, he or she must qualify
them to determine, if they are valid prospects. Unless this is done, time and
energy is wasted in trying to sell to people who cannot or will not purchase
the product or service.
There
are several factors to consider while qualifying a prospect. One approach to
qualifying often called MAN (Money, Authority and Need) approach is given
below:
Money: Does the prospect have the money or resources to purchase a product or service? Ability
to pay is very critical factor in qualifying a prospect. The sales people must
be familiar with financial resources of a prospect.
Authority: Does the prospect have the
authority to make commitment? This
is a particular concern when dealing with corporation, government agencies or
other large organizations. Even while selling to a married couple, it may be
difficult to identify who actually makes the purchase decision. A sales person
must identify the key decision maker early to economise on selling time more
effectively.
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Need: Does the prospect need the product or service? If a
sales person cannot establish that
the customer will benefit from purchasing a product or service, there is no
reason to waste a sales call. The prospect either will refuse the offer or will
end up dissatisfied with the purchase. Before proceeding further the sales
person should first appraise whether money, authority and need exist with the
prospect.
2.5.2Preparation
After
a prospect has been identified and qualified, the sales person prepares for the
sale of product or service. The preparation stage involves the two key
activities i.e. Pre-approach and Call Planning.
Pre-approach
The
pre-approach step includes all the information gathering activities necessary
to learn relevant facts about the prospect and his or her needs and situations.
Four necessary steps of
pre-approach are:
It
should disclose the party need and ability to buy.
It should provide information that will enable the seller
to tailor the presentation to the prospect.
It should provide information that may keep the sales
person from making serious tactical errors during the presentation.
Finally, a good pre-approached increases the sales person
confidence and makes him confident to handle whatever may arise during the
sales.
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Call
planning
Call
planning involves a specific planning sequence. The sales person defines the
objective of the call, devise a selling strategy to achieve this objective, and
makes the appointments. The primary objective of any sales effort is to get an
order. For some sales call intermediate objectives may be needed. Some examples
of intermediate objectives are:
To
obtain more information about the prospect.
To relate the prospects needs and concerns to features and
benefits of the product or service.
To
obtain permission for demonstration of the product.
To
introduce a new distributor.
The
sales person must develop a strategy, or course of action to achieve his or her
objective. Careful consideration of the prospect’s background and needs is
required in order to able to formulate a tailor made strategy appropriate for
the prospect. Since sales calls are costly, they should be arranged in advance.
Cold calls i.e. calls without specific appointment may be appropriate for
introducing the sales person or dropping off information. This method is
generally inefficient for selling most products and services and is not
consistent with modern professional selling.
2.5.3Presentation
After
establishing rapport with the prospects through calls, the sales person
proceeds to the formal sales presentation. The objective of the presentation is
to explain how the product meets the special needs of the consumer. The job of
the sales person is to inform the prospect about
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the
characteristics, capabilities and availability of goods and services that are
for sale. In order to ensure that the presentation is understood by the
prospect, the sales person should be clear in his/her communication.
Presentation should also be interesting enough to keep the attention of the
prospect focused on the proposal.
Sales presentations are classified into the different
categories: Fully
automated, Semi-automated, Memorized, Organized, and Unstructured.
Fully automated: The fully automated presentation
is the most highly structured
approach, based on film or slide presentations. The sales person simply answer
questions or clear up doubts. e.g. selling life insurance to the rural or
semi-urban prospects.
Semi-automated: In this approach, the sales
person reads from brochures or
literatures, adding comments to the prepared materials when necessary. A common
example is selling of pharmaceutical products by medical representatives.
Memorized: In memorized presentation,
company message is presented, with
few changes initiated by the sales person.
Organised presentation: The most popular and often the
most effective sales presentation
method is the organized presentation. With this method the sales person has
complete flexibility in oral communication but follows a company prepared
outline or checklist. The organized approach best exemplifies the selling
process in which customers are moved through four stages to a purchase
decision; i.e. attention, interest, desire and action (AIDA).
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Unstructured presentations:
(Also referred to as problem solving) In
this approach, the buyer and seller together explore the problems that are the
real sources of the company’s needs. Although unstructured presentations are
often effective and widely used, they have a number of limitations. Such
presentations tend to be not too well-focused. As a result, points are often
missed and time is wasted. Further, sales person do not usually anticipate
objections but may have to face surprise complaint from the prospects. Because
it is difficult to teach sales person how to use the unstructured method, the
problem solving presentation seems best suited to experienced, sales person who
are selling to established customers.
Sales
presentation comprises of two distinct activities, approach and demonstration.
Approach
When
the sales person has the name of the prospect and adequate pre-approach
information, the next step is the actual approach. It frequently makes or
breaks the entire presentation. If the approach fails, the sales person often
does not get a chance to give a presentation or demonstration. It gets the
prospect attention, it immediately inspires interest in hearing more about the
proposition, and it makes easy transition into the demonstration phase.
Four basic approaches are in
common use:
The introductory approach, the sales person introduces
himself to the prospect and states what company he represents.
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The product consists of handling the product to prospect
with little conversation. It can be most effective when the product is unique
and creates interest on sight.
The sales person starts the sale in a consumer-benefit
approach by informing the prospect of what the firm can provide in benefits. In
other words, directs the prospects attention toward the benefits the firm has
to deliver.
Lastly, referral approach successful in getting an audience
with prospect who is difficult to see directly. It consists of obtaining the
permission of a past or present customer to use his or her name as a reference
in meeting a new prospect.
Demonstration
The demonstration is the core of
the selling process. The sales
person actually transmits the
information and attempts to persuade the prospect through product demonstration
to make a customer.
Two
factors should be taken into consideration in preparing an effective product
demonstration:
The demonstration should be carefully rehearsed to reduce
the possibility of even a minor malfunction.
The demonstration should be designed to give customers ‘hand
on’ experience with the product wherever possible. For example an industrial
sales representative might arrange a demonstration before the purchaser’s
technical personnel.
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2.5.4Handling
objections
All
sales person confront sales resistance i.e. actions or statements by a
prospects that postpone, hinder or prevent the completion of the sale. Normally
sales resistance takes the form of an objection which can be classified as
stated or hidden. Prospects may state their objections to a proposition openly
and give the sales person a chance to answer them. This is an ideal situation
because everything is out in the open and the sales person does not need to
read the prospect’s mind. Unfortunately, in many instances prospects hide their
real reasons for not buying. Beside having hidden objections, their stated
objection may be phoney. Unless one can determine the real barrier to the sale
one shall not be able to overcome it. There are two major techniques for
discovering hidden objections. One is to keep the prospect talking by asking
probing questions. The other is to use insights gained through experience in
selling the product, combined with a knowledge of the prospects situation, to
perceive the hidden objection. Often objection to price and product are also
faced by sales person either in a form of unaffordable or too high price.
Product objections can be answered best when sales people have extensive
product knowledge of both their own products and competitors. Many times
prospects may be misinformed or may not understand some of the technical
aspects of the proposition. In this case, the sales person should provide
additional information. Even the prospects objections can be met simply and
effectively by altering the product to suit the customer.
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2.5.5Closing
After
having answered and overcome objections, it is the stage for sales person to
ask for the order from the prospects. The entire effort is wasted unless the
sales person can get the prospect to agree to buy the product. There are
several closing techniques which are being used by sales person in India. Sales
person should select among these technique one that fits the specific prospect
and selling situation. Now we would discuss few effective closing techniques.
In action close technique the sales person take an action that will complete
the sale e.g. in case of high priced products like Motorcar, photocopier or
industrial product the sales person may negotiate with the financial
institution for financial assistance for the prospects.
The
gift close technique provides the prospect with an added incentive for taking
immediate buying action. In one more yes close techniques, the sales persons
restates the benefits of the products in a series of questions that will result
in positive responses by the prospects. The process may result in an order.
The
direct close is clear and simple technique, many sales persons feel that this
is the best approach for closing, especially if there are strong positive
buying motives, the sales person will summarise the major points that were made
during presentation to the prospects prior to asking for the sale.
Experienced
sales people always try to close early. If they are not successful, they
continue the presentation and then try a different closing technique. Good
sales person know that if they have successfully
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completed
all of the earlier steps, then the prospect is worth an extra effort at
closing. In most cases this simply means switching to a different type of
close. Closing is the most important aspect of the sales process. Unless the
sales person can close the sale, the other steps in the sales process are
meaningless.
2.5.6Follow-up
The
selling process is not completed by merely making the sale, as generally
assumed by many sales person. After sales activities are important part of the
whole selling process. Effective sales-follow-up reduces the buyer’s doubt
about the product or services and improves the chance that the person will buy
again in the future. In addition to post-sale activities, sales person are also
required to maintain good customer relations.
Now-a-days
many companies are evolving specific policies and practices to ensure that
customer’s needs are not neglected. No matter how efficient a company is, there
are always some customer complaints. The complaint should be taken seriously
and handled with concern. The customer must know that the company cares about
maintaining good customer relations. Reasonably frequent contacts with the
present customers are, an expected part of the sales person’s job. For
important customers, personal visit are appropriate. Letters, notes, phone
calls, greetings are also good ways to keep in touch with customers. Many good
business house also offer customer newsletter.
Successful
sales person never stop serving customers. In addition to handling complaints,
they keep customer informed about the latest
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products
or services, fulfil reasonable request, and provide other forms of assistance.
The sales people should also appreciate the customer by thanking customers for
their business. Small gifts can be given after the sale and at appropriate
times during the year. Sales person should try to make self-analysis for
evaluating their own selling performance and methods. A Sales person should
analyse every call to determine what factors influenced its eventual outcome.
Self-analysis is a very useful tool in improving overall sales effectiveness.
SUMMARY
Today
personal selling has become a challenging profession. There has been a
significant change in its role from being a simple order taker to that of an
order maker or consultant to the buyers. Modern sales persons understand that
they are the major link in the total marketing strategy for the company. If a
company wants to maximize the effectiveness of its marketing programme, the
personal selling effort must be effectively integrated with the other elements
of the marketing mix.
With
the growing complexity of products, importance of personal selling has
increased. They now act as introducers, intelligent communicator as well as
demand pushers and also add unique utility to product. Their role has changed
drastically from being a simple communicator to business manager. In order to
be successful a sales person must possess a set of personal, product related
and functional qualities, as variety of analytical and administrative duties
are important component of the job. Before approaching a prospect every sales
person is advised to do bit of homework regarding company’s name, size,
authority concern and general requirement. While meeting the prospect,
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