Section 1

Q1.) Define the personal selling? Also explain the process of personal selling?

A1.) Personal selling is where businesses use people (sales force) to sell the product
after meeting face-to-face with the customer. The sellers promote the product
through their attitude, appearance and specialist product knowledge. They aim to
inform and encourage the customer to buy, or at least try the product.

A good example of personal selling is found in department stores on the perfume

and cosmetic counters. A customer can get advice on how to apply the product and
can try different products. Products with relatively high prices, or with complex
features, are often sold using personal selling. Great examples include cars, office
equipment (e.g. photocopiers) and many products that are sold by businesses to
other industrial customers.

The personal selling process is a seven step approach: prospecting, pre-approach,

approach, presentation, meeting objections, closing the sale, and follow-up:

1. Prospecting: The first step involves seeking out potential customers also known
as prospects. Prospecting can be done through cold calling, in-person networking, or
online research. An important part of the prospecting stage is lead qualification.
Personal selling is about finding solutions for customers, but, not everyone is fit to be
a customer or find a solution using product or service. Therefore, one must qualify
their leads to avoid spending precious time and resources on prospects that have
little to no chance of becoming customers.

2. Pre-Approach: During the pre-approach stage, the sales team needs to make
initial contact with any leads they’ve discovered while prospecting. Pre-approach
typically involves extensive online research about the prospect, the market, and his or
her business. This stage also includes building and practicing a sales presentation
tailored to the prospect.

3. Approach: In this stage, the sales team should make initial contact with a prospect
by reaching out, introducing themselves, and starting a conversation. This might
happen via a phone call, video call, email, or in-person. The ultimate goal of the
approach stage is to better understand the prospect and know their wants, needs,
and problems — anything that the product or service can help satisfy or solve

4. Presentation: Now, the team heads into the sales presentation stage. This is when
the sales team presents and potentially demonstrates the product or service.
Throughout the presentation, the sales team should focus on how the product or
service benefits the prospect, using information gathered in the pre-approach and
approach stages.

5. Handling Objections: Post presentation, a prospect might have queries. It’s the
job of the sales team to handle any objections and answer any questions. The
purpose of this stage is simply to learn more about how to best help the prospect
reach a solution.

6. Closing: After any objections to the sale have been eliminated, the team should
try to close the deal. This stage refers to settling any negotiations, contracts, or
paperwork that settles the deal.

7. Follow-Up: The final stage of the personal selling process is the follow-up, which
is when the sales team contacts the customer after a sale to ensure they're delighted
with the product. This stage is important because it allows the sales team to maintain
customer relationships.

Q2.) Write a short note on Territory Management and briefly describe the
procedure used for designing sales territories.

A2.) Territory management describes a process that helps inside sales reps by
defining geographical sales territories based on market factors and customer
intelligence data. Some key benefits of territory management are that reps can be
utilized more effectively, companies can do a better job of balancing sales territories
equitably and territorial assignments can be automated and resources can be utilized
to their optimal revenue-driving effect.

It is very important to create sales territories that are balanced. When a sales territory
is out of balance, there are two things that can happen. If a territory is being under-
serviced, the sales team or salesperson is spread too thinly and it leads to sub-
optimal levels of activity. Those responsible for the territories will seek out too few
leads, identify too little prospects and spend too little time with customers because
they are overworked. This leads to customers going to competitors and you losing
sales.

Over-servicing in a territory is where the sales team has too little work and too many
team members to service a small area. This raises costs and prices overall which
ultimately leads to reduced sales. Precious resources are also then not being utilized
in more important areas. This can lead to under-servicing in other areas.
Procedure for designing sales territories:

Step 1: Segment customer base and analyse market potential: Organizations that
have conducted analysis of their territories first segment their customer base to
understand the market. To do so, they rely on 4 pieces of data:

 Customer Master Database

 Complete set of Opportunity records
 Complete set of Lead records
 Third party suspect database

Step 2: Rank your talent: With these 4 inputs you can assess the true potential of
the market.  The next step is to look at the sales reps. The following questions need
to be answered:

 What was revenue attainment per rep last year?

 How much potential is in their territory patch?
 How many current customers and opportunities are in their patch?
 How many ideal company prospects are located in their territory? 

Finding this data will help ensure the top reps are in the best territories.

Step 3: Map customers and prospects: It involves determining where each

prospect and customer is located. Locations are selected where the buying centre
would be located.  The current spending of each account is determined along with
the workload required to service the account. 

Step 4: Create territories: Involves creating territories and assigning relative quotas
and compensation packages based upon realistic potential.  The number of customer
accounts and their potential spend are considered.  The same is done for prospect
accounts.  Finally, the workload required in each territory is given thought.  

Step 5: Review territory map: One need to review whether the reps are managing
the territories with the full potential or not. There might be a need to move reps into
new territories and ensure the best people are managing the best territories. There
might be a need to add and remove accounts based on analysis as well. 
Section 2
Q.) A company is launching a new washing machine in the Indian market. You
are one of the sales managers recruited by the company. What would be your
suggestions on, a. Break-up of the promotional budget into various elements of
promotional or communication mix b. Sales promotional tools to be used and c.
Integration of different communication-mix elements. (Make suitable
assumptions, if needed.)

(A.) In this case, we are assuming that the company is a household established brand
in the consumer durables market with profitable sales and a good amount of market
share.

(a.) We will be using percentage of sales method for deciding the break-up of the
promotional budget.

PROJECTED
CAMPAIGN TYPE %
SUBTOTAL

Public Relations Rs 8,00,000.00 16%

Social Media Rs 5,00,000.00 10%

Advertising Rs 20,00,000.00 40%

Trade Shows / Special Events Rs 5,00,000.00 10%

Sales Promotion Tools Rs 12,00,000.00 24%

Rs 50,00,000.00

(b.) Sales promotion is generally defined as those marketing activities that provide
extra values or incentives to the sales force, the distributors, or the ultimate
consumer and can stimulate immediate sales. Sales promotion is generally broken
into two major categories—consumer-oriented and trade-oriented activities.
In the case of a washing machine being introduced in the Indian market, we can use
both consumer and trade oriented promotion tools. Some of the tools are:

Consumer Oriented:

 Contests - Contests are the promotion events that give consumers the
chance to win something. Contests are conducted to attract new
customers. We can give customers a chance to win something – trip, cash
or goods.
 Demonstration - Demonstration is required when products are complex
and of a technical nature. Customers are educated as to how to make
proper use of the product. Demonstration of products induces customers
to buy. Demonstrations showing use of washing machine can help
customer understand the procedure as well as see results then and there.
 Installment Sales - In this case, consumers initially pay smaller amount of
the price and the balance amount in monthly installments over a period of
time. A scheme can be devised with customers paying a percentage of the
price and paying the rest in equal installments over a period of time.
 Delivery & Installations – We can provide additional after sales service by
providing delivery and easy installation at free of cost.

Trade Oriented:

 Trade Shows – Trade Shows provide the manufacturer a place to introduce

new items and to gain support for new products. In the case of our washing
machine, it will give it a proper platform for introduction and will also act as a
space for demonstration.
  Sales Incentives – These are awards given to salespersons for meeting or
exceeding sales goals. We can provide incentives for pushing out our product
to customers. This will help increase sales.

(c.) In the case of introducing a new washing machine in India, we can use
advertising, sales promotion, trade shows/ special events, public relations, personal
communication and social media for our communication mix.

 Advertising: We can come up with TV advertisements, print advertisements

and press releases. Moreover, the company can advertise using Bollywood
and sporting celebrities.
 Special Events: At important events, the company can organize seminars to
promote the product; washing machine by providing related information.
 Social Media: We can use the power of the internet to create an attractive
webpage for our washing machine along with interactive creative’s for social
media handles on Facebook, Instagram and Twitter.
 Word of Mouth: This type of personal communication can help spread good
word about our product. This will also help as a testimonial and build trust
among customers.
 Public Relations: In this form of communication mix, we can use publicity
events, newsletters and outbound communication to members of the press.
Section 3
Q4. Reps Selling Too Many Low-Profit Products

(A4.) Performance management makes up a significant part of every manager's job

and this means managers are required to deal with poor performance. Mr Clyde
Brion has to do the following as a remedy for the imbalanced sales performance:

i.) Identify what behaviour is causing the employee to underperform: Clyde

needs to understand what is causing the employees to underperform in terms of
high margin products. Clyde Brion should not limit his understanding to
individualities, must work on being objective and focus on the behaviour. In
particular he must determine if there is some form of task interference or
consequence imbalance occurring. Task interference can be anything that prevents
the employee from performing their job to an expected standard. This can be
something as basic as a new procedure or system that has caused the employee to
be less productive or it can be something that the employee doesn't have, like
proper resources, tools, skills or training.

ii.) Confront the poor performance: Clyde need to confront the employees
immediately to understand reasons for poor performance in selling high margin
products. Immediate confrontation is needed as the situation might get out of
control. In this case, Clyde knew about the situation for a long time but he had never
given it the attention it deserved. Clyde should use evidence and factual information
to state his case and focus on behaviour. Finally, Clyde should support your
assertions with data whenever possible.

iii.) Redirect behaviour to improve performance: Clyde Brion should begin the
process of redirecting their behaviour towards what is expected of them. This can be
done by taking their opinion on assessment of the behaviour issue, understanding
their perspective of their performance/behaviour and finally asking them to propose
a solution to address the problem. Once the employees have agreed on the solution
and the interaction is over, Brion needs to observe the employee's behaviour over a
period of time and convey the changes seen. The clarity of your communication will
ensure they understand the impact of their improved performance to themselves, the
team and the organisation.

Other measures which can be taken by Clyde Brion include:

 Taking care of other important matters which were hampering sales

volume: As mentioned in the case, Clyde Brion has “bushfires” to put out.
 Trying to eliminate these distractions will help Clyde focus his attention
towards the sales volume of the company.
 Selling High Margin Products: One of the major issues of the case was
going over quota on low-margin goods. This meant, overall profits were low
despite sales being satisfactory. This can be remedied by Clyde by trying to
maintain a ratio of low margin products to high margin products. The ratio
can be set in favour of high margin products to improve profitability.
Additional variable incentives can be provided to improve sales of high
margin products.
 Training: A lack of training in selling high margin products can be the reason
for low sales in the particular front. Sales reps can be provided with the right
training to sell high margin products.
 Improve Visibility of High Margin Products: Sales reps can be asked to
increase visibility of high margin products in order to reduce the gap
between high margin and low margin products. This will help increase the
sales of high margin products and bring in new accounts as well for the
company.

Q5. Change in Retailer Relationships

(a.) Identify the positive aspects of the firm’s performance in the above table?

(a.) The positive aspects of the firm’s performance are as follows-

An increase of 2 million in Total sales provides a good picture of some progress as

well as the fact that earlier methods are working well enough.

The acquisition of 3 new resellers indicates trust and belief in the market for the
product. With stiff competition, it becomes difficult to get hold of new resellers.

Increase in reorder sales this year for existing resellers compared to last year. The
cost of acquiring new customers is much more than that of retaining customers.
Hence the company is doing well to maintain and strengthen their ties with existing
resellers.

(b.) What areas of concern are apparent?

(b.) Some of the areas of concern are as follows-

Losing out on C which led to drop in a major chunk of our sales value. This might
indicate better offerings or even better incentivising by competitors to the resellers.
The new reseller’s total sales value makes up only 50% of reseller C’s last year sales
value. They did not add anything significant to the total sales value. This area might
need attention and strategic improvement.

(c.) What are some of the possible reasons for the change in sales results with
Reseller C?

(c.) Our reseller C is one of our biggest reseller’s with 50% of our total sales last year
coming in from C. A significant drop in sales value of C, puts the company in
jeopardy. One of the reasons for loss in sales value could be better offering/ product
being offered by competitors. Another reason could be a better incentive program
being provided to C. With a majority of our sales coming in from C, it clearly
displayed our dependence on the particular reseller which could prove to be
disadvantageous. There could have been a situation where C tried to take advantage
of this fact and asked for a better deal which we would have had to refuse to
maintain uniformity among reseller’s.

(d.) Where do you think the firm’s focus has been over the past year? What
should be the firm’s focus for the coming year (given the basic information
provided)?

(d.) Looking at the facts of the case, the firm looked more focused on overall sales
from all reseller’s. However the firm eventually realised that C was bringing in a bulk
of their sales and the firm was dependent on C for majority of its sales. High
dependency on one reseller increases the risk of achieving overall sales target.

The firm should try to look at the situation with a wholesome approach. They need to
realise that they should try and keep sales volume maintained at a good level across
all resellers. Another approach would be to improve relationships with existing
resellers, provide them with better offering and incentive schemes rather than opting
for new resellers, thereby increasing cost.