Sales Objectives and Planning

Sales-Force Objectives
• Objectives ensure that corporate goals are
met
• Goals include revenue, market share, and
improving corporate image among others
• Objectives assist sales force members to
plan and execute their personal sales
programs
 Sales-Force Objectives
• Must be customer designed annually for
each company
• Established to support corporate goals as
well as marketing and sales objectives
• Annual objectives may change in the event
of natural and other disasters
 Achieving Sales-Force Objectives

• Sales Volume
• Upselling and Second Chance Selling
• Market Share or Market Penetration
• Product-Specific Objectives
 Sales Volume

• Sales volume measures depend on industry

(like hospitality - Occupancy, passenger
miles)
• Sales volume by selected segments
• Sales volume and price/margin mix
 Upselling and Second Chance
Selling

• Selling additional services or upgrading

rooms and food and beverage
• Encourages cooperation and teamwork
between departments
 Market Share
• A brand's share of the total sales of all
products within the product category in
which that brand competes
• Determined by dividing a brand's sales
volume by the total category sales volume
 Market Penetration
• The percentage of the market owned by a
company as represented by share of revenue
• Sales personnel are often held accountable
for a predetermined level of market
penetration
 Product-Specific Objectives
• Improving sales volume for specific product
lines
• Sales managers must be careful when
setting product-specific objectives that they
do not ignore other product line members
Formulating Sales Objectives
 Strategic
Set
Planning Objectives
• Objectives are the broad goals
around which a strategic plan is
formulated. Formulate
• Strategies are the plans of Strategies
action.
• Tactics are the specific activities
that people must perform in
order to carry out the strategy.
Develop Tactics
 Levels of Organizational Strategy
• Corporate Strategy
– Mission, business portfolio, and future growth directions
for the entire corporate entity.
• Business Strategy
– action statements for each SBUs
• Marketing Strategy
– policies for each product-market combination.
• Sales Force Strategy
– decisions about how to access the target market and the
type of relationship the company wants to have with its
customers.
 Company Strategy-
Marketing Objectives and Strategy
Company

Objectives Marketing
Earn 20% ROI

Strategy
Objectives
Increase marketing share 10% Increase market
share 10%

Strategy
Increase share of customer business
 Marketing Strategy-
Sales Force Objectives, Strategy and Tactics
Marketing

Objectives
Increase market share 10%
Sales Force

Strategy
Increase share of customer business
Objectives
Increase share of
customer business

Strategy
Build long-term
customer relations

Tactics
Develop sales teams
Provide bonuses for greater customer share
 Marketing Objectives and
Strategy
Company Company Strategy Marketing
Objective (marketing Goal) Strategy

Increase ROI Increase market Increase share

from 10 % to share from 30 % with existing
20 % to 35 % customers
Capture new
customers
 Sales Force Objectives and
Strategy
Marketing Sales Force Sales Force
strategy (Sales Strategy Tactics
Force objective)
Increase share Build Long Change
with existing term customer compensation
customers by 5 relations plan
% Change
emphasis in
training prog.
 Sales Force Strategies
• Market Coverage
• Relationship
• Account
Market Coverage
 Sales Control vs. Coverage…
Control Coverage

Goal “We want to dominate and lead in “We want to reach and serve new
our core customer base, to markets and customers, and to
protect the brand, and control the grow as fast as possible”
relationship with the customer”

Channel • Field sales force • Retail, mass merchants

Approach • Telesales
• High-end partners, thoroughly • Distributors
trained, with binding contracts • Value-added resellers
covering all aspects of the sales • Internet
process • Strategic alliances
• 3rd party service agreements
• Etc.
 Market Coverage Example 1

Large, enterprise
Direct, Field Sales Reps
customers
Corporate
Resellers
Mid-sized
VAR’s, Solution Partners
accounts

Small office /
Mail order catalog (unserved market)
home office

Markets Simple, “off the Mass-customized Complex, unique

rack products products solutions
Products
 Market Coverage Example 2

Large, enterprise Direct, Field Sales Reps

customers

Mid-sized Business partners

accounts +
Telechannels
+
Web sites
Small office /
home office

Markets Simple, “off the Mass-customized Complex, unique

rack products products solutions
Products
Account Strategy
 Target Account Strategy
SALES
STRATEGY TARGET
ACCOUNTS

• Undifferentiated Account Approach

 Target Account Strategy

MULTIPLE Account Account

SALES 1 2
STRATEGY
Account Account
3 4

• Account Segmentation Approach

– Key Account
– Profitability
– Size
– Potential
Account Relationship Strategy
Account Relationship Strategy:

• A firm’s account relationship strategy refers to

the type of relationship it intends to develop with
its customers.
• this decision determines which customers can be
profitably served because it calls for very different
levels of investment into customer relationships.
• Account relationships may take a variety of forms,
each having major implications for the sales force
with respect to recruiting and selection,
compensation, necessary competencies, and
behaviors.
 Account Relationship Strategy

• How long is the selling cycle?

• How much time is spent on customer need discovery?
• Will the offering be customized for each customer?
• Will other functional areas be involved in the sale?
• How much will we need to invest in the individual
customer relationship?
• How easily can the customer switch to a competitor
once the relationship is established?
Types of Account Relationship:
• 1-A transactional relationship is one in
which the relationship is based on the need
for a product of acceptable quality,
competitively priced, and a process and
relationship convenient for the buyer.
• it is usually based on a personal relationship
between individual buyers and sellers.
 Types of Account Relationship:
• 2- Consultative Relationship. A consultative
relationship, a quite common relationship in
industrial markets, is based on the customer’s
demand and willingness to pay for a sales effort
that creates new value and provides additional
benefits outside of the product itself.
• -get very close to the customer and to intimately
grasp the customer’s business issues.
 3-Enterprise Relationship.
• An enterprise relationship is one in which the
primary function is to leverage any and all
corporate assets of the supplier in order to
contribute to the customer’s strategic success.
• -To achieve successful enterprise relationships, the
supplier must deliver exceptional customer value
while also extracting sufficient value from the
relationship.
 rise ip
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Investment Re
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Supplier ns tion
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Investment by Customer

Alternative Types of Account Relationships