Chapter 1

INTRODUCTION TO SALES
MANAGEMENT

Learning Objectives:

At the end of the lesson, the students should be able to :

1.   Define selling and different types of selling situations
2.   Explain the purpose and goals of selling
3.   Explain the importance of a salesperson in a sales organization.
4.   Differentiate between rational and emotional buying motives
5.   List the 3 levels of customer decision making
6.   Enumerate and understand the Professional Salesman’ Creed.

Introduction

Selling is a function of marketing that involves one-on-one contacts with

customers. Selling means exchange of goods/services for money. To be effective in sales,
a salesperson must possess product knowledge, as well as an understanding of customer’s
motives for buying the item and of the decision making process.

The importance of the selling function depends partially on the nature of the
product. As a general rule, goods that are new and different, technically complex or
expensive in the market usually require more personal selling effort. The salesperson plays
a key role in providing the consumer with the information about such product to reduce the
risks involved in its purchase and use. For example, insurance is a complex and technical
product that often needs significant amounts of personal selling. In addition, many
organizational products cannot be presold and the salesperson has a key role to play in
finalizing the sale. Through the efforts of the salesperson, a company can build
relationships with customers. It is the salesperson who serves as the conduit throughwhich
information regarding the product flaws, improvement, applications, or new uses can pass
from the customer to the marketing department.

Before management selects and trains salespeople, it should have an understanding

of the sales process. Obviously, the sales proves will differ according to the size of the
company and the nature of the product, the market, and so forth, but there are some
elements common to almost all selling situations that should be understood. For this
purposes, the term sales process refers to two basic factor: (a) the objectives the salesperson
is trying to achieve while engaged in selling activities and (b) the sequence ofstages or
steps the salesperson should follow in trying to achieve the specific objectives.

Personal Selling is the personal contact with one or more buyers for the purpose of making
a sale.

Sales Management is the process of planning, organizing, directing, staffing and

 controlling the sales operations to achieve the firm’s objectives through
subordinates.

Salesmanship is a seller-initiated effort that provides prospective buyers with information

and other benefits, motivating or persuading them to make buying decisions in
favor of the seller’s product or service.
Objectives of the Salesforce

Salesforce refer to the division of a business that's responsible for selling products
or services

Most organization include service representatives as part of their sales team to

ensure that customer concerns with present products are addressed and remedied
while at the same time new business is being solicited.

Personal selling must be justified on the basis of the revenue and profits itproduces.
There are two major categories of objectives generally assigned to the personal
selling function as part of the overall promotion mix. These objectives can be
categorized as either image or demand oriented.

A.   Image-Oriented Objectives

Personal selling involves public relation in general it can be considered with the
use of communication that is designed to foster a favorable image for goods, services
or organization. Needless to say, when personal selling is utilized as part of a public
relations effort, it is initiated and paid for by the sponsoring firm. The specific
objectives of the image-oriented personal selling are the following:

1)   As public role models in displaying the firm’s commitment to ethical

behavior through the employment of acceptable sales practices
2)   To portray the firm’s image by having salespeople maintain a good
appearance in all customer contact;
3)   To show firm’s commitment to relationship-building by having the sales
force follow practices at gaining the respect of customers, employees, and
other public entities.

B.   Demand-Oriented Objectives

When personal selling objectives are demand-oriented, the overriding goal is to

convert customer interest into first; an initial sale and repeat purchases. To achieve
this goal, three major categories of objectives are pursued.

1)   Information provision

In the case of new products or customers, the salesperson needs to fully

explain all attributes of the product or service, answer any question and probe for
additional questions.

2)   Persuasion

Once the initial product or service information is provided, the salesperson

needs to focus on the following objectives:
•   Clearly distinguish attributes of the firm’s products or services from those of
competitors
•   Maximize the number of sales by using presentations
•   Convert undecided customers into first-time buyers
•   Convert undecided customers into repeat purchasers
•   Sell additional or complementary items to repeat customers
•   Tend to the needs of dissatisfied customers

3)   After-sale service

Whether the sale represents a first-time or repeat purchase, the salesperson

needs to ensure the following objectives are met:

•   Delivery or installation of the product or service that meets or exceeds the

customer’s expectations
•   Immediate follow-ups calls and visits to address unresolved or new concerns
•   Reassurance of product or service superiority through demonstrable actions

Matching the characteristics of a product to a customer’s needs and wants is feature-

benefit selling. Customers may have both rational and emotional motives for
making a purchase. Three forms of customer decision-making are:

1.   Extensive decision making is used when there has been little or no previous
experience with an item. This category includes those goods and services that have
a high degree of perceived risk, are very expensive, that high value to the customer.
A customer who is buying his first house will use extensive decision making.

2.   Limited decision making is used when a person buys goods and services that he
or she has purchased before, but not regularly. There is a moderate degree of
perceived risk involved, and the person often needs some information before
buying the products. Customer goods and service in this category might include a
second car, certain types of clothing, furniture, household appliances, or a vacation.

3.   Routing decision making is used when a person needs little information about a
product. The perceived risk may be low because the item is inexpensive, the product
is bought frequently, or satisfaction with the product is high. Someconsumer goods
and services in this category are grocery items, newspaper, among others.
Customers who have developed brand loyalty from a product will use routine
decision making.

Personal selling is any form of direct contact between a salesperson and a

customer. The key factor that sets it apart from other forms of promotion is this, a
two-way communication between the seller and the buyer. This communication
 can take place in a retail selling, in a business-to-business setting and
telemarketing (over the phone). Salespeople need to research their products and
their customer. The more a salesperson knows about both, the better prepared and
the more effective he or she will be in offering customer’s solution to their problems
and in meeting their needs. Certain aspects in a salesperson’s job will vary
depending on where the selling takes place.

Types of Selling Situation

Retail Selling

Retail selling is unique because customers come to the store. The salesperson
should be available always to answer any questions about the product or its features.

Business – to – business Selling

Business-to-business selling may take place in a manufacturer’s or wholesaler’s

showroom (inside sales) or a customer’s place of business (outside sales). In the
latter case, it is up to the salesperson to make contact with the customer. Sales
representatives, in most cases, will call to make an appointment prior to their visit.
In other cases, a sales representative may make a cold call which means he or she
will appear without an appointment.

Telemarketing

The last type of personal selling situation is telemarketing which is the process of
selling over the telephone.

Goals of Selling

The purpose and goals of selling are the same regardless of the sales situations.
They are to help customers make satisfying buying decisions which can create
profitable relationships between buyer and seller. This is important because repeat
business is crucial to the success of any company. It is easier and less expensive
to keep current customers happy than it is to generate new customers. If a business
is successful at keeping customers happy, the customers are likely topass along
positive recommendations to other business associates, friends and family.

Consultative Selling

Salespeople accomplish these goals by engaging in a process called consultative

selling. Consultative Selling is providing solutions to customer’s problems by
finding products that meet their needs. For example, one customer says that she is
having a problem with her feet because she stands a whole day in her new job.
 Possessing the relevant product knowledge allows an alert salesperson to suggest
shoes designed for comfort and support.

Feature-Benefit Selling

Matching the characteristics of a product to a customer’s needs and wants in a

concept called feature-benefit selling. Many people believe that customers do not
buy products; rather they buy what the products will do for them. For example,
leather shoes are purchased for their appearance, easy care, comfort and longevity.

Product Features

A salesperson needs to learn how a product’s features will benefit the customer.
Product features may be basic, physical, or extended attributes of the product or
purchase. The most basic feature of a product is its intended use. For example, a
person buys an automobile for transportation and a watch to tell time.

The physical features of a product differentiate competing brands and models. In

buying a vehicle, a consumer might consider the car’s engine, gas consumption,
appearance, radio system and tires and whether the car has a automatic
transmission, air bag, power steering and antilock brakes.

Additional features may add value or provide the reasons for price differences
among product models. Extended product features for a vehicle also include the
warranty, service policy and available financing. Customers might consider also
reputation of a company to be an extended feature because there is reduced risk in
doing business with a well-established company.

Pederson and Wright, distinguished authorities in salesmanship, wrote the

following creed:

The Professional Salesman’s Creed

1.   I will place customer and company interest above self-interest.

2.   I will be constantly alert to the concept that successful selling must bring mutual
and continuous benefits to both the buyer and seller.
3.   I will maintain an optimistic and positive attitude towards my business at all
times.
4.   I will maintain loyalty to my company, my associates, and my customers.
5.   I will do everything possible to support the free-enterprise system based upon
open competition and freedom of choice in the market place.
6.   I will continue to develop new knowledge, skills and attitudes to keep pace with
the changing technological and social environment,
7.   I will make every effort possible to utilize efficiently my total capacities in
rendering quality service to my customers and company.
 8.   I will never violate the trust and confidence of my customers or associates.
9.   I will maintain honesty and integrity in all of my dealings with my
customers,competitors, colleagues, and company.
10.  In all of my personal activities, I will attempt to do what is right and just
for allparties concerned.

Customer Benefits

When the features of a product are developed into customer benefits, they
become selling points. Customer benefits are the advantages or personal
satisfaction a customer will get from a good or service. It is a salesperson’s
job to analyze the product features from the customer’s point of view to
determine the benefits. A salesperson will need to answer two questions
about each product feature:

1.   How does the feature help the product’s performance? The answer to this
questionrepresents the first step in developing benefit it gives or provides
the customer.For example, air pockets in the heel of a running shoe cushion
impact on the pavement.
2.   How does the performance information give the customer a personal reason
to buy the product? What value is the product to the customer? In the case
of the running shoe, the air pockets give the wearer more comfort when
running or walking and help to protect the foot from injury.

Customer Buying Motives

Salespeople must know what motivates customers to buy and what decisions
customers make before the final purchase.

Customers may have rational or emotional motives for making purchases.

A rational motive is a conscious, logical reason for a purchase. It includes

product dependability, time or monetary savings, health or safety
considerations, service and quality.

An emotional motive is a feeling experienced by a customer through

association with a product. It includes feelings such as social approval,
recognition, power, love or prestige. Many buying decisions involve a
combination of both buying motives.

Successful salespeople determine customers’ rational and emotional motives

in a potential buying situation. Then they suggest the features and benefits
of the product that best matches those motives.