Chapter 17

Managing the
Sales Force

PowerPoint by Karen E.
James Louisiana State
University - Shreveport

©2003 Prentice Hall, Inc. To accompany A Framework for Marketing Management, 2nd Edition Slide 1 in Chapter 17
 Objectives

 Review the types of decisions firms

face in designing a sales force.
 Learn how companies recruit, select,
train, supervise, motivate, and evaluate
a sales force.
 Understand how salespeople improve
their selling, negotiation, and
relationship-building skills.
©2003 Prentice Hall, Inc. To accompany A Framework for Marketing Management, 2nd Edition Slide 2 in Chapter 17
 Designing the Sales Force

Types of Sales Representatives

Deliverer
Order taker
Missionary
Technician
Demand creator
Solution vender
©2003 Prentice Hall, Inc. To accompany A Framework for Marketing Management, 2nd Edition Slide 3 in Chapter 17
 Designing the Sales Force

Figure 17-1:
Designing a Sales Force

©2003 Prentice Hall, Inc. To accompany A Framework for Marketing Management, 2nd Edition Slide 4 in Chapter 17
 Designing the Sales Force

Steps in Process  Objectives

– Sales volume and
profitability
 Objectives and – Customer
strategy satisfaction
 Strategy
 Structure – Account manager
 Sales force size  Type of sales force
– Direct (company) or
 Compensation contractual
©2003 Prentice Hall, Inc. To accompany A Framework for Marketing Management, 2nd Edition Slide 5 in Chapter 17
 Designing the Sales Force

Steps in Process  Types of sales

force structures:
 Objectives and – Territorial
strategy – Product
 Structure – Market
 Sales force size – Complex
 Key accounts
 Compensation
©2003 Prentice Hall, Inc. To accompany A Framework for Marketing Management, 2nd Edition Slide 6 in Chapter 17
 Discussion Scenario

Ariel Jones has tremendously increased the

number of accounts and the dollar value of
sales within her territory. She’s so busy
servicing existing accounts that she has little
time to seek new business. Management has
decided to “split” her territory by giving 50% of
her existing client base to a new sales rep.
What are the pros and cons of this strategy?
Can it be implemented in a manner that
minimizes potential negative consequences?
©2003 Prentice Hall, Inc. To accompany A Framework for Marketing Management, 2nd Edition Slide 7 in Chapter 17
 Designing the Sales Force

Steps in Process  Workload approach:

– Group customers by
volume
 Objectives and – Establish call
strategy frequencies
– Calculate total yearly
 Structure sales call workload
– Calculate average
 Sales force size number of calls/year
– Calculate number of
 Compensation sales representatives
©2003 Prentice Hall, Inc. To accompany A Framework for Marketing Management, 2nd Edition Slide 8 in Chapter 17
 Designing the Sales Force

Steps in Process  Four components of

compensation:
– Fixed amount
 Objectives and – Variable amount
strategy – Expense allowances
– Benefits
 Structure  Compensation plans
 Sales force size – Straight salary
– Straight commission
 Compensation – Combination
©2003 Prentice Hall, Inc. To accompany A Framework for Marketing Management, 2nd Edition Slide 9 in Chapter 17
 Designing the Sales Force

Figure 17-2:
Managing the Sales Force

©2003 Prentice Hall, Inc. To accompany A Framework for Marketing Management, 2nd Edition Slide 10 in Chapter 17
 Managing the Sales Force

 Recruiting begins with the

development of selection criteria
– Customer desired traits
– Traits common to successful sales
representatives
 Selection criteria are publicized
 Various selection procedures are
used to evaluate candidates
©2003 Prentice Hall, Inc. To accompany A Framework for Marketing Management, 2nd Edition Slide 11 in Chapter 17
 Managing the Sales Force

Personality
testing is one
method of
screening
candidates.

©2003 Prentice Hall, Inc. To accompany A Framework for Marketing Management, 2nd Edition Slide 12 in Chapter 17
 Managing the Sales Force

Typical Training Topics

Company background Sales presentation
and products techniques

Training
Company
Topics Procedures and
characteristics responsibilities

Competitors’ products
©2003 Prentice Hall, Inc. To accompany A Framework for Marketing Management, 2nd Edition Slide 13 in Chapter 17
 Managing the Sales Force

Many firms
specialize in
sales force
training.

©2003 Prentice Hall, Inc. To accompany A Framework for Marketing Management, 2nd Edition Slide 14 in Chapter 17
 Managing the Sales Force

 The amount of time needed and the

training method used vary with the
level of task complexity.
 Successful firms have procedures to
aid in evaluating the sales force:
– Norms for customer calls
– Norms for prospect calls
– Using sales time efficiently
©2003 Prentice Hall, Inc. To accompany A Framework for Marketing Management, 2nd Edition Slide 15 in Chapter 17
 Managing the Sales Force

Using Sales Time Efficiently

Greater emphasis on
phone and Internet usage
Greater reliance on
inside sales force
Time-and-duty analysis

Configurator software
©2003 Prentice Hall, Inc. To accompany A Framework for Marketing Management, 2nd Edition Slide 16 in Chapter 17
 Managing the Sales Force

Configuator
software
packages
assist in
complex
pricing tasks.

©2003 Prentice Hall, Inc. To accompany A Framework for Marketing Management, 2nd Edition Slide 17 in Chapter 17
 Managing the Sales Force

 Motivating the Sales Force

– Most valued rewards
• Pay, promotion, personal growth, sense
of accomplishment
– Least valued rewards
• Liking and respect, security, recognition
– Sales quotas as motivation tools
– Supplementary motivators
©2003 Prentice Hall, Inc. To accompany A Framework for Marketing Management, 2nd Edition Slide 18 in Chapter 17
 Managing the Sales Force

 Evaluating the Sales Force

– Various sources of information
may be used
– Types of formal evaluation include:
• Performance comparisons
• Knowledge assessments

©2003 Prentice Hall, Inc. To accompany A Framework for Marketing Management, 2nd Edition Slide 19 in Chapter 17
 Managing the Sales Force

Sources of Information When

Evaluating the Sales Force

Call Reports
Customer Surveys
Personal Observation
Other Sales Representatives
Customer Letters/Complaints
©2003 Prentice Hall, Inc. To accompany A Framework for Marketing Management, 2nd Edition Slide 20 in Chapter 17
 Personal Selling Principles

Figure 17-3:
Managing the Sales Force: Improving Effectiveness

©2003 Prentice Hall, Inc. To accompany A Framework for Marketing Management, 2nd Edition Slide 21 in Chapter 17
 Personal Selling Principles

Major Aspects  Sales-oriented

approach
– Stresses high
 Sales pressure techniques
professionalism  Customer-oriented
approach
 Negotiation – Stresses customer
problem solving
 Relationship  Steps in industrial
marketing selling process
©2003 Prentice Hall, Inc. To accompany A Framework for Marketing Management, 2nd Edition Slide 22 in Chapter 17
 Personal Selling Principles

Figure 17-4:
Major Steps in Effective Selling

©2003 Prentice Hall, Inc. To accompany A Framework for Marketing Management, 2nd Edition Slide 23 in Chapter 17
 Personal Selling Principles

Major Aspects  Reps need skills for

effective negotiation
 Negotiation is useful
 Sales
when certain factors
professionalism characterize the sale
 Negotiation  Negotiation strategy
 Relationship – Principled
– BATNA
marketing
©2003 Prentice Hall, Inc. To accompany A Framework for Marketing Management, 2nd Edition Slide 24 in Chapter 17
 Personal Selling Principles

Major Aspects  Building long-term

supplier-customer
relationships has
 Sales grown in importance
professionalism  Companies are
shifting focus away
 Negotiation from transaction
marketing to
 Relationship relationship
marketing marketing
©2003 Prentice Hall, Inc. To accompany A Framework for Marketing Management, 2nd Edition Slide 25 in Chapter 17
 Discussion Scenario

Salespeople who meet or exceed their

assigned quotas are typically given
higher quotas the following year.
How might this practice impact a
company’s 1) internal marketing
efforts with employees, and 2)
relationship marketing efforts with
external customers?
©2003 Prentice Hall, Inc. To accompany A Framework for Marketing Management, 2nd Edition Slide 26 in Chapter 17