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The Nature and Role of Selling Selling’s function is to make a sale. Its striking aspect is the wide diversity of selling roles. Companies spend large sums of money to train their sales personnel in the art of selling. Why? the sales personnel are the single most important link with the customer.
THE BEST DESIGNED AND PLANNED MARKETING EFFORTS MAY FAIL BECAUSE THE SALESFORCE IS INEFFECTIVE.
It is important to recognize that selling and sales management, although closely are not the same thing.
Q- Which of the following is true? a. Selling and sales management, although closely related, are not the same thing. b. Selling and sales management are the same thing c. Selling and sales management has no relationship d. The role of selling has remained unchanged over the years.
Q- The simplest way to think of the nature and role of selling (traditionally called salesmanship) is to make a Ans: Sale.
Strengths of personal selling: 1- Interactive: questions can be answered and objectives overcome 2- Adaptive: presentations can be changed to meet customer needs 3- Complex arguments can be developed. 4- Relationships can be built because of its personal nature. 5- Provides the opportunity to close the sale. Weakness of personal selling: Sales calls are costly.
Q- Which of these is not a strength of personal selling? The experience and expertise of salespeople are varied
Q- Which of these is a weakness of personal selling? Training can be costly and it needs to be ongoing
Characteristics of modern selling:
- Customer retention and deletion
- Database and knowledge management
- Customer relationship management
- Marketing the product
- Problem-solving and system selling
- Satisfying needs and adding value
1- Customer retention and deletion Many companies find that 80 percent of their sales come from 20 percent of their customers it is vital to devote considerable resources to retaining existing high volume, high potential, and highly profitable customers.
Key account management has become an important form of sales organization because it means that a salesperson or sales team can focus their efforts on one or a few major customers. some small customers actually cost the organization money. This is because servicing and distribution of products to those customers may push costs beyond the revenue generated.
Larger companies may have to change to telemarketing and/or the internet as a means of servicing these small customers or drop them altogether.
2- Database and knowledge management T he modern salesforce needs to be trained in the use and creation of customer databases, and how to use the internet to aid the sales task.
3- Customer relationship management Customer relationship management requires that the salesforce focuses on the long term and not simply on closing the next sale. The emphasis should be on creating win-win situations with customers so that both parties to the interaction gain and want to continue the relationship.
4- Marketing the product The modern salesperson is involved in a much broader range of activities than simply planning and making a sales presentation.
- face-to-face presentations can now sometimes be replaced by the information presented on web pages and by email attachments
- that give the customer up-to-date information on many topics more quickly and comprehensively, and in a more time-convenient manner than many face-to-face interactions.
- The role of the salesperson is expanding to participation in marketing activities such as: product development, market development segmentation of markets, database management, provision & analysis of information, assessing market segments.
5- Problem-solving and system selling modern selling, particularly in B2B situations, is based upon the salesperson acting as a consultant working with the customer to identify problems, determine needs and propose and implement effective solutions. Customers today are increasingly looking for a systems solution rather than the buying of an individual product. For example: to sell door handles to a company like Ford a supplier must not only be able to sell a door system that includes door handles as well as locking and opening devices but also have a thorough knowledge of door technology, and the ability to suggest to Ford solutions to problems that may arise.
6- Satisfying needs and adding value modern salesperson must have the ability to identify and satisfy customer needs. Some customers do not recognize they have a need. It is the salesperson's job in such situations to stimulate need recognition.
- For Example: customers may not realize that a machine in the production process has low productivity **compared to newer, more technologically advanced ma- chines.
- salesperson’s job is to make customers aware of the problem in order to convince them that they have a need** **to modernize the production process.
- salesperson will have added value to the customer’s business by reducing costs and created a win–win** situation for their company and the customer.
Q- Which one is not a characteristic of modern selling? a. Customer retention and deletion b. Supply chain management c. Customer relationship management d. Marketing the product.
order-takers do not deliver and to a certain extent, they are being replaced by more cost-efficient telemarketing teams.
Q- Which is not the selling function? a. Order-takers b. Order-getters c. Order-delivery d. Order-creators.
Q- Which is the part of Order-takers? Delivery salespeople
Subdivision of order creators and its explanation. Missionary salespeople: In some industries, notably the pharmaceutical industry, the sales task is not to close the sale but to persuade the customer to specify the seller's products. For example, medical representatives calling on doctors cannot make a direct sale since the doctor does not buy drugs personally, but prescribes (specifies) them for patients. Similarly, in the building industry, architects act as ii.specifiers rather than buyers, and so the objective of a sales call cannot be to close the sale. Instead, in these situations, the selling task is to educate and build goodwill.
Order-getters definition and its subdivisions. Consists of those in selling jobs where a major objective is to persuade customers to make a direct purchase.
Order-getting demands several skills:
- ability to identify new prospects,
- persuading and negotiating,
- ultimately building a new and profitable business in the face of often fierce competition. I. Front-line salespeople II. Sales support salespeople
Sub-subdivisions of I. Front-line salespeople i.New business salespeople ii. Organisational salespeople iii. Consumer salespeople
Sub-subdivisions of II. Sales support salesperson and its definitions. i. Technical support salespeople: provide sales support to front-line salespeople so they are normally considered to belong in the order-getters group. Where a product is highly technical and negotiations are complex, a salesperson may be supported by product and financial specialists who can provide the detailed technical information required by customers. ii. Merchandisers: These people provide sales support in retail and wholesale selling situations. Orders may be negotiated nationally at head office, but sales to individual outlets are supported by merchandisers who give advice on display, implement sales promotions, check stock levels and maintain contact with store managers.
Marketers and salespersons often distinguish between two major categories of types of marketing and selling based upon the category of customers being targeted.
Two major categories of distinct customer groups or markets are business versus consumer customers (B2C) or put another way, business marketing to consumers (B2B)
Consumer markets (B2C) the customer is purchasing products and services their own or their family's use.
The principal motives for purchase, therefore, are personal in nature. consumer market there are a number of different types or sub-markets depending on the type of product and consumer purchase we are considering. Q- Marketers and salespersons often distinguish between two major categories of types of marketing and selling based upon Ans: the category of customers being targeted.
Different Types of consumer markets are considered below:
1. Fast moving consumer goods (FMCG): customers are purchasing products which generally involve relatively low financial outlays, are bought frequently and are generally non-durable. such a s: toothpaste, confectionery, cigarettes, grocery products, etc.
- Semi-durable consumer goods: products such as clothing and shoes, soft furnishings, jewelry, and so on. 3. Durable consumer goods: durable consumer goods include products such as refrigerators, cars, computers, and so on. purchases which are made less frequently. The customer will often take considerable care in choosing between different product offerings and will be looking for lots of information and help in purchasing.
Business to business (B2B) markets: are characterized by often large and powerful buyers, purchasing predominantly for the furtherance of organizational objectives and in an organizational context using skilled/professional buyers.
Demand in B2B markets: is normally derived demand; customers are often geographically concentrated and negotiation is the order of the day in dealings between marketer and customer.
Marketing and selling in these markets: is very different from that encountered in B2C markets.
Buyers are much more likely to negotiate on price, and delivery and service are particularly important.
A salesperson is likely to be dealing with skilled negotiators and the process of buying, and hence selling can extend over months or even years for certain types of capital equipment.
As in consumer markets, there are several distinct types of sub-markets within B2B markets, the main ones being:
**- Markets for supplies and consumables e.g.
- raw materials,
- semi-manufactured goods;
- Markets for capital equipment e.g.
- plant, machinery;
- Markets for businesses services e.g.
- consultancy, technical advice.**
there are a number of key qualities that are generally recognised as being important:
1. Empathy and an interest in people: such a skill will help in more accurately identifying customers’ real needs and problems in terms of thinking oneself into the other person’s mind and understanding why the customer **_feels as they do.
- Ability to communicate: this means an ability to get a message across to a customer and, more importantly,_** **_an ability to listen and understand. The skill of knowing when to stop talking and when to listen is essential.
- Determination: although the salesperson must be able to take no for an answer, this should not come easily_** to someone who wants to succeed in selling. It is a fact that customers might say no when they really mean maybe, which can ultimately lead to yes. Determined salespeople have a need and a will to succeed and success can mean closing a sale.
Q- Which of the following is the misconception about selling? a. Selling is not the worthwhile career b. Selling is the worthwhile career c. Selling is an easy task d. Selling is moral
number of elements in the sales task that act as demotivators:
- Because of their perceived low status, salespeople are constantly exposed to the possibility of rejection and often have to suffer ‘ego punishment’ such as being kept waiting, appointments cancelled at short notice and ‘put downs’ from customers, to which they cannot adequately respond as buyers have the power in such circumstances. in business to business (B2B) and business to consumer (B2C) selling in particular a certain amount of psychological risk is involved.
- In B2B situations in particular, salespeople visit buyers in their offices, they are effectively working in ‘foreign’ territory and might sometimes feel uneasy when entering the premises. The customer might keep the salesperson waiting, thus heightening discomfort.
- The salesperson tends to work alone, staying away from home for periods. An attraction is independence, but it can be a lonely existence. Thus there is a certain amount of psychological risk attached to such situations.
-Selling then is not entirely blameless
- but salespeople are becoming more professional in their approach to customers.
The following facts about selling should be more universally aired:
- There is nothing immoral or unscrupulous about selling or about those involved in this activity.
- Selling provides a mechanism for exchange and through this process customers' needs and
- wants are satisfied.
- Selling is a worthwhile career.
- have found it to be a challenging, responsible and rewarding occupation.
- offers substantial discretion in being able to plan one's own work schedule.
- Good products do not sell themselves.
- An excellent product may pass unnoticed unless its benefits and features are explained to
- customers.
- Selling is unique in that it deals with the special needs of each individual customer
- ➢ Salesperson, with specialist product knowledge, is in a position to assess these
- circumstances and advise each customer accordingly. Selling provides a mechanism for exchange and through this process customers' needs and wants are satisfied.
- Selling is a worthwhile career.
- have found it to be a challenging, responsible and rewarding occupation.
- offers substantial discretion in being able to plan one's own work schedule.
- Good products do not sell themselves.
- An excellent product may pass unnoticed unless its benefits and features are explained to customers.
- Selling is unique in that it deals with the special needs of each individual customer ➢ Salesperson, with specialist product knowledge, is in a position to assess these circumstances and advise each customer accordingly. -Selling provides a mechanism for exchange and through this process customers' needs and wants are satisfied.
- Selling is a worthwhile career.
- have found it to be a challenging, responsible and rewarding occupation.
- offers substantial discretion in being able to plan one's own work schedule.
- Good products do not sell themselves.
- An excellent product may pass unnoticed unless its benefits and features are explained to customers.
- Selling is unique in that it deals with the special needs of each individual customer ➢ Salesperson, with specialist product knowledge, is in a position to assess these circumstances and advise each customer accordingly. **- Three successive stages in the evolution of modern business practice:
- Production orientation** This era was characterized by focusing company efforts on producing goods or services. More specifically, management efforts were aimed at achieving high production efficiency, often through the large-scale production of standardized items. In such a situation other functions. such as sales, finance, and personnel were secondary to the main function of the business, which was to produce. More importantly, the underlying philosophy was that customers would purchase products, provided they were of reasonable quality and available in sufficiently large quantities at a suitably low price.
THE NATURE AND ROLE OF SALES MANAGEMENT
In the same way that selling has become more professional, so too has the nature and role of sales management.
Sales management
- those involved in management are being called upon to exercise in a professional way the key duties of all managers, Namely; o planning o organizing controlling
Sale Manager
- to be a good sales manager you had to have the right personality.
- the main feature of the job was ensuring that the salesforce were out selling sufficient volume.
- expected to play a much more strategic role in the company
- required to make a key input into the formulation of company plans
- needs to be familiar with the concept of marketing to ensure that sales and marketing activities are integrated.
- needs to be able to analyze and direct the activities of the salesforce towards more profitable business.
- In dealing with a sales force, the sales manager must be aware of modern developments in human resource management.
➢ Role of the sales manager o Accountant o Planner o Personnel manager o Marketer
- the prime responsibility is to ensure that the sales function makes the most effective contribution to the achievement of company objectives and goals.
➢ In order to fulfill this role, sales managers will undertake specific duties and responsibilities: o determining salesforce objectives and goals; o forecasting and budgeting; o salesforce organization, salesforce size, territory design and planning salesforce selection, recruitment and training; o motivating the salesforce; o salesforce evaluation and control.
Market potential Is the maximum possible sales available for an entire industry during a stated period of time
Explain process of markets
- Segmentation: identify meaningful groups of costumers
- Targeting: select which segments to serve
- Positioning: build and improve brand equity to chosen target
Market Individuals or organizations who:
- Are willing, able, and capable of purchasing a firm's product
- Segmentation is critical because demand is often heterogeneous Market Segmentation Is the process of identifying those clusters of customers in a market that share similar needs and wants and will respond in a unique way to a given marketing effort.
Once the target market has been defined, what happen? sales management can translate that specification into individual accounts to target.
Types of market segmentation and its definitions
- Differentiated: Targeting two or more segments with different marketing mixes for each. - Concentrated: When an organization concentrates its marketing efforts on a smaller segment of a larger market. - Undifferentiated: A strategy that ignores differences between groups within a market and offers a single marketing mix to the entire market. It works when a product is new to the market and there is minimal or no competition.
element of the four Ps requires that decisions are taken:
1. Price: price levels, credit terms, price changes, discounts. 2. Product: features, packaging, quality, range. 3. Promotion: advertising, publicity, sales promotion, personal selling, sponsorship. 4. Place: inventory, channels of distribution, number of intermediaries.
One of the most useful concepts in marketing derives from the idea that most products tend to follow a particular pattern over time in terms of sales and profits.
product life-cycle is analogous to the life-cycle pattern of humans and has four distinct stages – introduction (birth), growth, maturity and eventually decline.
1. Introduction: sales growth is relatively slow.
- Dealers must be persuaded to stock and promote the product.
- Consumers must be made aware of its existence,
- persuaded to be interested and convinced that it is a worthwhile purchase. They may have to be educated in how to use the product and their existing purchasing and lifestyle habits might change (e.g. microwave ovens and their associated convenience). There are few profits at this stage and heavy launch costs often mean a financial deficit. 2. Growth: after initial slow acceptance,
- sales begin to escalate at a relatively rapid pace.
- There is a snowball effect as word-of-mouth communication and advertising begin to take effect.
- Dealers may request to stock the product.
- Profits begin to be made, especially if a newly introduced product can command high initial prices (known as market skimming).
3. Maturity: the growth of sales begins to slow as the market becomes saturated.
- Few new buyers are attracted to the product and there is a high proportion of repeat sales.
- Attracted by the high profit and sales figures,
- competitors have now entered the market. Partly because of this increased competition, profits, having peaked, then begin to decline. 4. Decline: sales begin to fall and already slim profit margins are depressed even further.
- Customers might have become bored with the product and are attracted by newer,
- improved products.
- Dealers begin to de-stock the product in anticipation of reduced sales.
Push strategy: In which the focus of marketing effort is aimed at pushing the product through the channel of distribution. Pull strategy: R elies much more heavily on advertising to promote the product to the final consumer. The essence of this the approach is based on the notion that if sufficient consumer demand can be generated for a product this will result in final consumers asking retailers for the product. Categories that are grouped together as the sales approach is similar and behavioral patterns exhibited by each conforms to organizational behavior.
- Fewer Customers
- Concentrated Markets
- Complex Purchasing Decisions
- Long Term Relationship
- Reciprocal
- Types of Production
Types of production and its definitions
- Job (or unit or project) production: an item is produced or constructed to individual customer requirements.
- Batch production: a number of products or components are made at the same time, but not on a continuous basis.
- Flow (or mass or line) production: this is continuous production of identical or similar products that are made in anticipation of sales.
- Process (or continuous) production: the production unit has raw materials coming into the manufacturing process and a finished product emerging at the end.
11- Who is proud of you? Me!
