The Promotion Strategy: Developing and Managing Sales

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Chapter 13

The Promotion Strategy: Developing and Managing Sales

The Promotion Strategy: Developing and Managing Sales

13.1

Organizing and Preparing a Sales Force

Planning, Directing, and Evaluating Sales

13.2

The Promotion Strategy: Developing and Managing Sales

13.1

Explain the role of personal selling in businesses. Define the two types of selling situations. Describe the kinds of training needed by salespeople.

Section 13.1 Organizing and Preparing a Sales Force

The Promotion Strategy: Developing and Managing Sales

13.1

By thoroughly preparing the salespeople you hire, you can maximize their effectiveness. This is true no matter what background and experience they bring to the job.

Section 13.1 Organizing and Preparing a Sales Force

The Promotion Strategy: Developing and Managing Sales

13.1

personal selling prospect sales force order getting order taking rational buying motive emotional buying motive customer benefits

buying process prospecting preapproach approach objections suggestion selling sales check

Section 13.1 Organizing and Preparing a Sales Force

The Promotion Strategy: Developing and Managing Sales

Personal Selling
Personal selling is important because it involves the human aspect of promotion.
personal selling selling conducted by direct communication with a prospective customer

Section 13.1 Organizing and Preparing a Sales Force

The Promotion Strategy: Developing and Managing Sales

Personal Selling
Personal selling relies on direct contact with a prospect, which is critical to companies whose customers need detailed information.
prospect a potential customer

Section 13.1 Organizing and Preparing a Sales Force

The Promotion Strategy: Developing and Managing Sales

Staffing the Sales Force

Businesses use their sales force to help customers make buying decisions.
sales force a group of employees involved in the selling process

Section 13.1 Organizing and Preparing a Sales Force

The Promotion Strategy: Developing and Managing Sales

Staffing the Sales Force

Sales are classified into two groups: order getting and order taking.
order getting seeking out buyers and giving them a well-organized presentation; sometimes referred to as creative selling
order taking the completion of a sale to a customer who has sought out a product

Section 13.1 Organizing and Preparing a Sales Force

Traits of Successful Salespeople

knowledge organization follow-through punctuality energy
Section 13.1 Organizing and Preparing a Sales Force

empathy promptness ability to solve problems willingness to work hard honesty

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The Promotion Strategy: Developing and Managing Sales

Proving Sales Training

When hiring new or experienced salespeople, businesses must provide training. They must prepare them to sell the products or services, and teach or reteach the principles of selling, including the mechanics of selling.

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The Promotion Strategy: Developing and Managing Sales

Preparing to Sell
Before a salesperson is ready to sell, he or she must be trained in the following selling skills:
company knowledge product knowledge customer knowledge foundational skills for selling Internet skills for selling
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The Promotion Strategy: Developing and Managing Sales

Preparing to Sell
Salespeople should be trained to interpret whether a customer has a rational buying motive for making a purchase or an emotional buying motive that prompts a purchase.
rational buying motive a conscious, logical reason to make a purchase, such as convenience or comfort
emotional buying motive a feeling a buyer associates with a product, such as recognition or prestige

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The Promotion Strategy: Developing and Managing Sales

Preparing to Sell
There three levels of product knowledge:
1. benefits to the customer 2. details about the company and its products 3. Information about the competitions products

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The Promotion Strategy: Developing and Managing Sales

Preparing to Sell
Knowing a products customer benefits is essential for success in selling because people buy products for their benefits.
customer benefits the advantages of personal satisfaction that a customer will get from a product

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The Promotion Strategy: Developing and Managing Sales

The Buying Process

In preparation for selling, the sales trainee must also understand the buying process.
buying process a series of steps a customer goes through when making a purchase

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The Buying Process

The Stages of Selling (AIDA)
Attention
Getting the prospective buyers attention

Interest
Developing an interest in the product

Desire
Creating a desire for the product

Action
Getting the customer to buy
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The Selling Process

The Ten Steps of the Selling Process
1
2 3 4 5

prospecting
preapproach approach determining needs presentation

6
7 8 9 10

overcoming objections closing the sale suggestion selling closing mechanics follow-up
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Section 13.1 Organizing and Preparing a Sales Force

The Promotion Strategy: Developing and Managing Sales

The Selling Process

Prospecting is seeking out new leads.
prospecting a systematic approach to developing new sales leads or customers, who are identified through referrals, public records, or surveys

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The Promotion Strategy: Developing and Managing Sales

The Selling Process

Prior to sales contact, the salesperson should prepare a preapproach and gather information about prospective customers needs and wants.
preapproach the marketing activities that precede a salespersons approach to a prospective customer that are intended to help achieve a successful sale

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The Promotion Strategy: Developing and Managing Sales

The Selling Process

The steps in a salespersons approach, such as establishing a friendly and professional relationship, should be carefully planned to get the customers attention and interest.
approach a salespersons first contact with a customer

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The Promotion Strategy: Developing and Managing Sales

The Selling Process

When customers voice objections during the presentation of the product, a good salesperson selects appropriate methods to respond to the customers worries.
objections any concern, hesitation, doubt, or other reason a customer has for not making a purchase

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The Promotion Strategy: Developing and Managing Sales

The Selling Process

If a customer is purchasing a dress shirt, for example, the salesperson may use suggestion selling and offer a tie to go with it.
suggestion selling selling additional goods to a customer to go along with a product or products the customer is purchasing

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The Promotion Strategy: Developing and Managing Sales

Selling Mechanics
The basics of selling mechanics involve understanding:
order forms and proposals cash register operation sales checks sales tax

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The Promotion Strategy: Developing and Managing Sales

The Selling Process

A sales check provides valuable information to the business, such as the date, items purchased, and purchase price.
sales check a written record of a sales transaction

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The Promotion Strategy: Developing and Managing Sales

13.1

1. Explain the role of personal selling in businesses.

Personal selling, for many companies, is a key ingredient in their marketing mix. It is particularly important to companies that rely on direct contact with customers and to companies whose customers need detailed information.
Section 13.1 Organizing and Preparing a Sales Force
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The Promotion Strategy: Developing and Managing Sales

13.1

2. Define the two types of selling situations.

Order getting is seeking out buyers and giving them a well-organized presentation. Order taking is completing a sale with a customer who has sought out a product.

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The Promotion Strategy: Developing and Managing Sales

13.1

3. Describe the kinds of training needed by salespeople.

Salespeople need training in preparation for selling, the buying process, the selling process, and the mechanics of selling.

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The Promotion Strategy: Developing and Managing Sales

13.2

Identify the components of sales planning. List the elements that are involved in directing sales. Discuss the procedures used in evaluating sales performance.

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The Promotion Strategy: Developing and Managing Sales

13.2

Effective sales operations are developed through careful planning, directing, and controlling.

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The Promotion Strategy: Developing and Managing Sales

13.2

sales planning sales forecast sales territory sales quota salary

commission sales call reports SWOT analysis morale

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The Promotion Strategy: Developing and Managing Sales

Planning Sales
Before putting the sales force to work, a business must complete its sales planning.
sales planning the process that involves determining the goals and timing of sales efforts

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The Promotion Strategy: Developing and Managing Sales

Forecasting Sales
A companys sales forecast is based on the estimated market share the company thinks it can obtain.
sales forecast an estimate of sales for a given period, such as the next quarter

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Forecasting Sales
There are several methods for forecasting sales:
market analysis and industry information surveys data analysis operational analysis
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Budgeting Sales
Three basic budgets are needed for sales activities:
sales budget

$ $ $

selling expense budget

administrative sales cost budget

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The Promotion Strategy: Developing and Managing Sales

Establishing Territories
A business that covers a wide area should establish sales territories to ensure market coverage, reduce selling costs, and improve customer relations.
sales territories geographical areas in which existing and potential customers are grouped

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The Promotion Strategy: Developing and Managing Sales

Settling Sales Quotas

A sales quota can be used to indicate strong and weak areas in the sales operation, provide incentives for the workforce, and improve effectiveness of compensation plans.
sales quota a performance goal assigned to a salesperson for a specific period

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The Promotion Strategy: Developing and Managing Sales

Directing Sales Operations

You must direct your sales activities by providing:
motivation incentives a favorable environment resources leadership

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The Promotion Strategy: Developing and Managing Sales

Compensating Your Sales Staff

The following options are available as methods of payment for salespeople:
straight salary straight compensation combination of salary and commission

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The Promotion Strategy: Developing and Managing Sales

Compensating Your Sales Staff

A salary ensures a regular, stable income for the employee.
salary regular wages an employee receives from an employer

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The Promotion Strategy: Developing and Managing Sales

Compensating Your Sales Staff

A commission plan has an advantage in the incentive it provides for employees, but a disadvantage in the difficulty in directing commissioned salespeople.
commission a fee for services rendered based on a percentage of an amount sold; payment is based on sales alone

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The Promotion Strategy: Developing and Managing Sales

Supervising Your Sales Force

You can supervise your sales staff using these techniques:
personal contact sales reports electronic communications meetings

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The Promotion Strategy: Developing and Managing Sales

Compensating Your Sales Staff

Some salespeople account for their activities in a sales call report.
sales call report an account of sales activities, including such items as number of calls made, orders obtained, and miles traveled

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The Promotion Strategy: Developing and Managing Sales

Adjusting to Sales Environment Changes

By using a SWOT analysis, a company can assess its current situation.
SWOT analysis a strategic planning technique that analyzes a companys internal strengths and weaknesses, and opportunities and threats in the external sales environment

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The Promotion Strategy: Developing and Managing Sales

Maintaining Morale
To maintain high morale, a business should foster a positive work climate.
morale a state of an individual psychological well-being based on a sense of confidence, usefulness, and purpose

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The Promotion Strategy: Developing and Managing Sales

Evaluating Sales Performance

The final step in managing the sales operation is to evaluate sales performance. Sales performance evaluation involves:
evaluating company-wide sales evaluating the sales of individual salespeople

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The Promotion Strategy: Developing and Managing Sales

Evaluating the Companys Sales Performance

To evaluate your companys sales performance:
1. Compare your companys sales volume with its budgeted sales goals 2. Analyze your marketing costs to identify unprofitable marketing efforts.

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The Promotion Strategy: Developing and Managing Sales

Evaluating Individual Sales Performance

There are five steps involved in evaluating sales staff performance: 1. 2. 3. 4. 5. Establish guidelines. Identify factors to be measured. Set standards for performance. Compare performance to standards. Discuss results with salespeople.
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Section 13.2 Planning, Directing, and Evaluating Sales

The Promotion Strategy: Developing and Managing Sales

13.2

1. Identify the components of sales planning.

The components of sales planning are forecasting sales, budgeting sales, establishing territories, and setting sales quotas.

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The Promotion Strategy: Developing and Managing Sales

13.2

2. List the elements that are involved in directing sales.

The elements involved in directing sales are motivating salespeople, compensating the sales staff, handling expenses and transportation, supervising the sales force, adjusting to changes in the sales environment, and maintaining morale.

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The Promotion Strategy: Developing and Managing Sales

13.2

3. Discuss the procedures used in evaluating sales performance.

To evaluate a companys sales performance, analyze sales volume and marketing costs. To evaluate individual sales performance, establish guidelines, identify factors to be measured, set standards for performance, compare performance to standards, and discus results with salespeople.
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The Promotion Strategy: Developing and Managing Sales

Using E-Mail for Selling

E-mail can be an effective tool for marketing. Many customers sign up for e-mail mailings lists.

There are many laws that apply to e-mail marketing, so it is advisable to know the law before beginning an e-mail marketing campaign.

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The Promotion Strategy: Developing and Managing Sales

Tech Terms
double opt-in list an online opt-in mailing list with a two-step confirmation process; subscribers must confirm their registration by responding to an e-mail message netiquette the code of conduct that governs online behavior

opt-in list an online mailing list made up of subscribers who have given permission to be sent e-mail by the mailing list owner
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The Promotion Strategy: Developing and Managing Sales

Tech Terms
opt-out list an online mailing list to which recipients do not choose to subscribe; recipients must complete an online form or send an e-mail if they choose not to receive mailings spam unsolicited commercial e-mail

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End of

The Promotion Strategy: Developing and Managing Sales

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