Introduction to

Sales Management

Everyone lives by selling something

Robert Louis Stevenson

 Learning Objectives

 To understand evolution, nature and importance

of sales management
 To know role and skills of modern sales
managers
 To understand types of sales managers
 To learn objectives, strategies and tactics of
sales management
 To know emerging trends in sales management
 To understand linkage between sales and
distribution management
Evolution, Nature and Importance of Sales
Management
Evolution of Sales Management
 Situation before industrial revolution in U.K.

(1760AD)
 Situation after industrial revolutions in U.K., and

U.S.A.
 Marketing function splits into sales and other

functions like market research, advertising,

physical distribution
 What is Sales Management?

 One definition: “The management of the

personal selling part of a company’s marketing
function.”
 Another definition: “The process of planning,
directing, and controlling of personal selling,
including recruiting, selecting, equipping,
assigning, supervising, paying, and motivating
the personal sales force.
 Nature of Sales Management
 Its integration with marketing
management Head-
Marketing

Manager- Manager – Manager – Manager – Manager –

Promotion Market Sales Market Customer
Research Logistics Service

• Relationship Selling

Transactional Value – added Collaborative /

Relationship / Relationship / Partnering
Selling Selling Relationship /
Selling
Relationship Selling

 Salespeople concentrate their team selling

efforts on building trust and service on a few
carefully selected customers over a long
period with an aim of becoming a preferred or
sole supplier
 Transactional Relationship / Selling:- one type of
relationship marketing in which salespeople make one-
time sales to price-oriented customers ,who are not
contacted again
 Value – added Relationship / Selling:- understanding
current and future needs of customers and meeting
those needs better than competitors with value – added
solution to their problems
 Collaborative relationship :- a type of relationship
marketing in which a selling organization works
continuously with its large customers to improve the
customer performance in terms of operations, sales and
profit
  Varying Sales Responsibilities / Positions / Jobs
Sales Position Brief Description Examples
• Delivery salesperson • Delivery of products to business • Milk, newspapers to households
customers or households.
• Also takes orders. • Soft drinks, bread to retail stores.

• Order taker (Response selling)
• Inside order taker • Behind counter in a garment
shop
• Telemarketing salesperson takes • Pharma products’ orders from
orders over telephone nursing homes
• Outside order taker. Also • Food, clothing products’ orders
performs other tasks from retailers

• Sales support • Provide information, build • Medical reps. in pharma industry

• Missionary selling goodwill, introduce new products
• Technical selling • Technical information, assistance • Steel, Chemical industries

• Order-getter (Creative, Problem- • Getting orders from existing and • Automobiles, refrigerators,
solving, Consultative selling) new household consumers insurance policies
• Getting orders from business • Software and business solutions
customers, by solving their
business and technology problems
Importance of Personal Selling and Sales
Management
 The only function / department in a company
that generates revenue / income
 The financial results of a firm depend on the
performance of the sales department /
management
 Many salespeople are among the best paid
people in business
 It is one of the fastest and surest routes to the
top management
 Roles and Skills of a Modern Sales Manager

Some of the important roles of the modern sales

manager are:
• A member of the strategic management team
• A member of the corporate team to achieve objectives
• A team leader, working with salespeople
• Managing multiple sales / marketing channels
• Using latest technologies (like CRM) to build superior
buyer-seller relationships
• Continually updating information on changes in
marketing environment
Skills of a Successful Sales Manager

 People skills include abilities to motivate, lead,

communicate, coordinate, team-oriented
relationship, and mentoring
 Managing skills consist of planning, organizing,
controlling and decision making
 Technical skills include training, selling,
negotiating, problem-solving, and use of
computers
Types of Sales Managers / Levels of Sales
Management Positions
CEO /
President

V. P. Sales / Top-Level Sales Managers /

V. P. Marketing Leaders

National Sales Manager

Regional / Zonal / Divisional

Middle-Level Sales Managers
Sales Managers

District / Branch / Area Sales Managers First / Lower Level Sales Managers

Sales Trainee / Sales Person / Sales Representative

Sales Objectives, Strategies and Tactics
The main components of planning in a company are
objectives, strategies and tactics. Their relationship
is shown below

Decide / Set Evolve Tactics /

Develop Strategies Action Plans
Objectives

E.G. A company wants to increase sales of

accessories by 15 percent, as one of the sales
objectives.
 To illustrate the relationship between sales objectives,
strategies and tactics, consider:
Sales Goals / Marketing Sales and Distribution Strategy Tactics /
Objectives Strategy Action plans

 Increase  Enter export  Identify the countries  Marketing / sales head to get
sales volume markets relevant information
by 15  Decide distribution channels  Negotiate and sign
percent agreements in 3-5 months
with intermediaries

 Penetrate  Review and improve  Add channels and members

existing salesforce training, motivation  Train salespeople in
domestic and compensation deficient areas
markets  Use effective and efficient  Train field salesmanagers in
channels effective supervision
 Link sales volume quotas to
the incentive scheme of the
compensation plan
 Emerging Trends in Sales Management

 Global perspective
 Revolution in technology
 Customer relationship management (CRM)
 Salesforce diversity
 Team selling approach
 Managing multi-channels
 Ethical and social issues
 Sales professionalism
Linking Sales and Distribution Management
 Either sales management or distribution
management cannot exist, operate or perform
without each other
 To achieve the sales goals of sales revenue and
growth, the sales management plans the
strategy and action plans (tactics), and the
distribution management has the role to execute
these plans
 Role of Distribution Management for some of the
Sales Management Actions / Tasks
Sales Management Actions / Distribution Management Role
Tasks

 Strategy for effective coverage  Follow call plan / beat plan

of markets and outlets  Make customer call productive
 Use multi-channel approach

 Strategy for handling customer  Prompt action at the customer interface level
complaints  If the problem persists, involve senior sales
and service people

 Planning of local advertising  Co-ordination with distribution channels

and sales promotion  Responsibility of execution with distribution
channels
 Expenses are shared between the company and
intermediaries
SALES
MANAGEMENT
 SALES MANAGEMENT - 1
 EVOLUTION:
PRIOR TO INDUSTRIAL REVOLUTION, SMALL
SCALE ENTERPRISES - NO SELLING ISSUES
MANUFACTURING WAS THE CORE OPERATION
POST INDUSTRIAL REVOLUTION, FACTORIES
PRODUCING LARGE QUANTITIES - LARGER
NO. OF CUSTOMERS. REQUIRED
WORKFORCE, LAND BUILDINGS AND
MACHINES AND LARGE SCALE INVESTMENTS.
PRODUCTION SOUGHT MARKET EXPANSION
ANSWERED BY SPECIALIZED SALES
DEPARTMENTS AND OPERATIONS.

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 SALES MANAGEMENT - 1
 SALES MANAGEMENT
PLAN, BUILD AND MAINTAIN EFFECTIVELY
DESIGNED ORGANIZATIONS WITH EFFICIENT
CONTROL MECHANISMS.
PROFESSIONAL APPROACH REQUIRES
ANALYSIS, SALES OBJECTIVES BASED ON
SALES POLICIES AND STRATEGIES
SALES EXECUTIVES ARE PROFESSIONALS WHO
CONDUCT SALES OPERATIONS WITH
RESPOSIBILITIES TO THEIR ORGANIZATION,
CUSTOMERS AND THE SOCIETY AT LARGE.

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 SALES MANAGEMENT - 1
 RESPONSIBILITIES:
TOP MANAGEMENT: SALES VOLUMES, PROFITS
CONTRIBUTION, BUSINESS GROWTHS
CUSTOMERS: COMPETITIVE PRODUCTS/
SERVICES, SUPPORT ACTIVITIES
SOCIETY: PRODUCTS/ SERVICES AT
ACCEPTABLE PRICES. SOCIALLY
RESPONSIBLE PRODUCTS -ENVIRONMENT
FRIENDLY.
ORGANIZATION’S INTERESTS SHOULD BLEND
WITH CUSTOMERS’ AND SOCIETY INTERESTS.
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 SALES MANAGEMENT - 1
 DEFINITION
PLANNING, DIRECTION, CONTROL OF
PERSONAL SELLING
SALES FORCE MANAGEMENT

RECRUITMENT, SELECTION, EQUIPMENT,

ASSIGN, ROUTE, SUPERVISE, REMUNERATE,
MOTIVATE SALES FORCE

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 SALES MANAGEMENT - 1
 RESPONSIBIITIES OF SALES MANAGER
FORMAL & INFORMAL ORGANIZATIONAL
STRUCTURES TO ENSURE EFFECTIVE
COMMUNICATION.
PLANNING BUDGETS, TARGETS,
TERRITORIES.
DECISIONS ON PRODUCTS, MARKETING
CHANNELS, DISTRIBUTION, PROMOTIONS.
IN MOST ENTERPRISES SALES MANAGEMENT
IS A KEY FUNCTION. MANUFACTURERS,
DISTRIBUTORS ENCOUNTER VARIED ISSUES
RELATED TO SALES MANAGEMENT.

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 SALES MANAGEMENT - 1
 OBJECTIVES OF SALES MANAGEMENT:
SALES VOLUME: BASED ON MARKET AND
SALES POTENTIAL
CONTRIBUTION TO PROFITS: PRODUCT MIX IN
INCREASING VOLUMES
CONTINUING GROWTH: CAPABILITIES OF
SALES FORCE AND DISTRIBUTION CHANNELS
BASED ON SALES MANAGEMENT’S APPRAISAL
OF MARKET OPPORTUNITIES, TARGETS ARE
SET FOR SALES VOLUME, GROSS MARGIN
AND NET PROFITS. THE GROWTH
PROJECTION FOR SALES AND PROFITS
BENCHMARKED.
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 SALES MANAGEMENT - 1
 SALES MANAGEMENT EFFECTIVENESS AND
FINANCIAL RESULTS:
FINANCIAL RESULTS STATED AS:
SALES – COST OF SALES = GROSS PROFITS
GROSS REVENUE – EXPENSES = NET PROFIT
SALES NET
SALES MANAGEMENT GROSS PROFITS PROFITS
PERFORMANCE EXPENSES
COST OF SALES AFFECTED BY TARGETED UNIT COST
MAINTAINED BASIS TARGETED VOLUMES. SO S.M.P. -
INDIRECTLY AFFECTS COST OF SALES
CONCERN IN VALUE RELATIONSHIP NOT
PERCENTAGE
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 SALES MANAGEMENT - 1
 SALES FUNCTION: COORDINATION
1. SINGLE PURPOSE ORDER GENERATION
2. PLANNING SALES, GROWTH, PROFIT
TARGETS
3. OPERATING SALES PROMOTION PROGRAMS
4. GAINING PRODUCT DISTRIBUTION
5. OBTAINING DEALER IDENTIFICATION
6. COMMUNICATION WITH MIDDLEMEN
7. SHARING PROMOTIONAL RISKS
8. MARKETING STRATEGY IMPLEMENTATION
NEW PRODUCT/ BRAND/ SERVICE INTRODUCTION
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 SALES MANAGEMENT - 1
 SALES MANAGEMENT CONTROL
CONTROL PERSONAL SELLING EFFORTS TO
ACHIEVE SALES OBJECTIVES:
1. SIZING UP – REVIEW/ANALYZE PAST, PRESENT
TO IMPLEMENT FOR FUTURE
2. SETTING QUANTIFIABLE PERFORMANCE
STANDARDS – ACID TEST OF A STANDARD –
CONTRIBUTE MORE TO PERSONAL SELLING
EFFICIENCY THAN IT’S COST. ACCEPTABLE
RANGE OF PERFORMANCE AS A STANDARD
3. DATA ON ACTUAL PERFORMANCE -
INFORMATION DEPENDS ON STANDARD
SELECTED –ADEQUATE, USEFUL FOR
REQUIREMENT
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 SALES MANAGEMENT - 1
4. EVALUATING PERFORMANCE: COMPARISON
WITH STANDARDS. CONTROLLABLE AND
UNCONTROLLABLE VARIABLES
5. ACTION POINTS FOR CONTROLLABLES: SALES
COVERAGE, SYSTEMATIC SALES APPROACH,
WORKING TO A PLAN. DIRECTION, GUIDANCE
AND CONTROLLING RESULTS
6. ADJUSTMENTS FOR UNCONTROLLABLES:
CHANGES IN ECONOMIC CONDITIONS, GOVT.
POLICIES, NATURAL DISASTERS. NEED TO
ADJUST SALES PLANS ACCORDINGLY.

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 SALES MANAGEMENT - 1
 SALES CONTROL
INFORMAL: AWARENESS AND ANALYTICAL ABILITY
ARE ADEQUATE CONTROL DEVICES. FINGERS ON
THE PULSE OF BUSINESS. WITH LAYERS IN
HIERARCHY FINGERTIP CONTROL GIVES WAY TO
FORMAL CONTROL. DEPENDABLE FEEDBACK FOR
WORKABLE DECISIONS AND POLICIES.
FORMAL: FOR LARGE BUSINESSES, WRITTEN SALES
AND MARKETING POLICIES NEEDED FOR
UNIFORMITY OF ACTION. WHEN A LARGE NUMBER
OF POLICY EXCEPTIONS OF SMILAR NATURE ARE
HANDLED, A CHANGE IN POLICY IS REQUIRED.

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 SALES MANAGEMENT - 1
3. POLICY FORMULATION: REFLECTS DYNAMICS
OF EXECUTIVE CONTROL – EVOLVES FROM
STUDY AND EVALUATION OF TANGIBLE
INFORMATION. WORKING WITH NEW
PRODUCTS/SERVICES WHERE QUANTITATIVE
DATA IS LACKING, THE PLANS AND OBJECTIVES
ARE REVIEWED CONSIDERING THE VARIATIONS
OF RESULTS WITH STANDARDS. WITH
SUCCESSIVE REVISIONS, POLICIES BECOME
APPROPRIATE.
4. SALES VOLUME CONTROL: SALES VOLUME
ESTIMATES FOR SPECIFIC PERIOD IS A
PREREQUISITE FOR PLANNING AND CONTROL.

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 SALES MANAGEMENT - 1
THE STANDARD FOR SALES PERFORMANCE IS
BY EVALUATING AGAINST SALES FORECAST.
OTHER FACTORS TO BE CONSIDERED, WHICH
IMPACT SALES PERFORMANCE ARE: INDUSTRY
SALES TRENDS, COMPETITOR ACTIVITIES,
MARKET SHARES. SIGNIFICANT CHANGES IN
THESE FACTORS CALL FOR POLICY, PLANS,
OBJECTIVES REVIEW.
5. BUDGETARY CONTROL: SETING SALES
BUDGETARY CONTROLS AND SALES
TERRITORIES. CONTROL OVER SALES
VOLUMES, EXPENSES IMPACTING PROFITS.
SALES MANAGEMENT CAN PROJECT:

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 SALES MANAGEMENT - 1
P & L STATEMENT FOR TERRITORIES, PRODUCTS,
MARKETING CHANNELS. STANDARD COST
ESTIMATES OF DISTRIBUTION CAN BE SET UP.
MARKETING COSTS ANALYSIS IS ACTUAL
EXPENSES COMPARED AGAINST STANDARD
COSTS TO DETERMINE PERFORMANCE
STANDARDS. TIMELY ACTION CAN FOLLOW THIS
ANALYSIS TO IMPROVE PERFORMANCE.
6. SALES CONTROL AND ANALYSIS:
CONTROL VARIES WITH DEGREE OF
DECENTRALISATION. HIGHER EXECUTIVES DEAL
MORE WITH POLICY OR CONTROL “EXCEPTIONS”
THAN WITH CONTROL MECHANISM.
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 SALES MANAGEMENT - 1

FOR SPEED THE POWER TO MAKE DECISIONS IS

DELEGATED AS FAR DOWN IN THE
ORGANIZATIONAL STRUCTURE AS IS
CONSISTENT WITH THE CALIBER AND
EXPERIENCE OF EXECUTIVES.

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 SALES MANAGEMENT - 2
 PERSONAL SELLING
Sales Management Directs Personal Selling Efforts
Personal Selling is a Broader Concept than
Salesmanship.
Elements of Marketing Programmes are: Personal
Selling, Pricing, Advertising, Product Development,
Market Research, Marketing Channels, Distribution.
Salesmanship: Art of successfully persuading
prospects to buy products or services to Increase
Customers’ level of satisfaction. Provide features of
products or Services and how they Benefit
Customers.
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 SALES MANAGEMENT – 2
PERSONAL SELLING :
Interactive Communication with Prospects.
Expectations from Sales Person:
1. Through Knowledge of Product Features,
Applications, Usage. Knowledge of Competition.
2. Play the role of Specialists, Counselors, Advisers
with a Friendly Approach.
3. Identify each prospect as different and make
presentations accordingly.
4. Sales Executives must be close to real life selling
situations to respond to practical issues faced by
Sales Personnel on a day-to-day basis.
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 SALES MANAGEMENT - 2
BUYER-SELLER INTERACTION:
Salesperson and Prospect Interaction –Buyer
Seller “dyad”. Seller using Advertising with a
Prospect through Print, Audio or Video is a
dyad. However there is no Personal Interaction
in Advertising.
Personal Characteristics of salesperson which
affect selling: Physical appearance, behaviour,
income, religion, education, habits, mannerisms,
experience with the organization, knowledge of
prospects’ peer group, business honesty.
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 SALES MANAGEMENT - 2
A strategy to Achieve a Sales depends on Sales
presentation and Prospect’s readiness to Buy.
Presentations are aimed at satisfying Prospect’s
needs and expectations. The Objective of a
sales call is to successfully sell on every call.
Strategy for a Sales Call-Preparation:
Researching the prospect. Making materials ready
for presentation (catalogues, specifications,
costing, competition)
Presentation: Brief and relevant. Answer
Objections.
Conclusion of the call – Sales and any follow –up.
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 SALES MANAGEMENT - 2
PERSONAL SELLING SITUATIONS
Service Selling: Continue Business with existing
Customers on a periodic basis.
Developmental Selling: Convert prospects to
Customers who could be using Competition.
Service Selling
1. Counter Sales: Waits on Customers
2. Delivery Salesperson: Delivers goods ordered.
3. Route Salesperson: Sells to customers on a
Route at regular intervals.
4. Missionary: Educate and build a goodwill.
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 SALES MANAGEMENT - 2
5. Technical Salesperson: Engineers,
Architects, Tax advisers
Developmental Selling
6. Creative Salesperson of Tangibles: Play on
aspirations of the prospect. Fancy fixtures,
Bigger automobiles, Exotic Holiday Locations,
Expanding Knowledge
7. Creative Salesperson of Intangibles:
Insurance, educational programmes.
8. Creative Salesperson for large volumes:
Tender or Contractual sales, Large volumes for
Bulk buyers – Chain Stores, Producers
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 SALES MANAGEMENT - 2
9. Multiple selling: B to B. Salesperson requires
support of authorities for Pricing, Production,
Delivery and after sales services.
Developmental Selling is complex, challenging.
Depends upon Product and Customers. If
Creativity is also required then the salesperson
may need some back-up support.
Continuous updating knowledge and selling
skills of respective situations are a prerequisite
to personal selling.

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 SALES MANAGEMENT - 2
THEORIES OF SELLING:
Selling has basic Concepts and learning through
experience. Presentation with enthusiasm.
AIDAS Theory: Structured Presentation
Securing Attention: Put the prospective in a receptive
frame of mind. Establish rapport to break prospects
guard. Start with a positive comment.
Gaining Interest: Arouse prospect’s interest in the
product. Use of visual aids. Technical presentations
with laptops. Intervene with revealing questions,
answer stock objections.
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 SALES MANAGEMENT - 2
Kindling Desire: Develop on optional solutions
to prospects’ problem. Zero down to the
product. Handle objections.
Inducing Action: Watch for buying signals. Trial
Close induces action.
Building satisfaction: reassure prospect on the
choice. Ensure proper execution of sales. For
high involvement products, ensure after sales
services. Use on customer’s satisfaction to
reassure other prospective customers.
This is a capsule approach with all focus on the
seller.
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 SALES MANAGEMENT - 2
BUYING FORMULA THEORY:
This theory emphasises the buyer’s side of the buyer-
seller dyad. The buyer’s needs receive all the
attention and the salesperson’s role is to help the
buyer fulfill the need. The process involved in
buying is:
Need (problem) Solution Purchase
To continue with the buyer seller relationship, one
more element is added:
Need (problem) Solution Purchase Satisfaction
Individual has degree of dissatisfaction which is
solved by a product or/and service. The solution
has two parts – Product and Brand or salesperson.
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 SALES MANAGEMENT - 2
To ensure purchase, the product or service and
the Brand must be considered adequate by the
buyer. A product viewed as adequate may not
be liked. A product viewed as adequate and
liked may not be bought as the source of supply
is not liked. Some products are patronized even
though they are inadequate and compared to
competing brands.
Adequacy
Need Product or Brand Purchase Satisfaction
Liking
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 SALES MANAGEMENT - 2
The primary elements in the buying process are
indicated by arrows. Elements of buyer’s
defensive mechanism is shown by lines-
pleasant feeling, adequacy. The answer to each
selling issue is implied in the buying formula.
However different answers arise due to
emphasis upon the elements. Emphasis should
be placed depending upon circumstances.
SITUATIONS:
1.Problem not recognized. Emphasise problem
2.Recognizes the problem, no thinking of Product.
Emphasise association of problem and product.
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 SALES MANAGEMENT - 2
3.Does not think of Brand with product.
Emphasise association of product with Brand.
4. Need, Product, Brand are well associated,
emphasis should be on facilitating purchase and
use.
5. If competition is bought emphasise on own
product features and benefits
6. For a new prospect all elements of the
process should be presented.
7. More sales to old customers, reminder of the
product and new uses emphasis.
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 SALES MANAGEMENT - 2
BUYER DISSONANCE
When individuals choose between two or more
alternatives, buyer anxiety due to dissonance
always occurs as the decision has attractive and
unattractive features.
After decision the buyers seek information which
supports the decision and avoid information
likely to favour rejected alternatives. This is
Cognitive Dissonance which may be
experienced pre- or post –decision or both. To
reduce the anxiety pre-or post-or dissonance
the salesperson has a very important role to
play.

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 SALES MANAGEMENT - 2
Salespersons Role in Cognitive Dissonance:
1. Established Brand and ongoing buyer-seller
relationship: In a stable market, the trust in the
Brand, the salesperson may be emphasised.
2. Established Brand and new buyer-seller
relationship: the trust in the Brand, the dealings
of organization with other satisfied customers to
be emphasised.
3. A new Brand and ongoing buyer-seller
relationship: Emphasise the trust in the
salesperson and in established Brands of the
organization
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4. A new Brand and new buyer-seller relationship:
The buyer requires dissonance reduction. The
salesperson is less capable of providing it.
A salesperson can facilitate the buyer’s
dissonance reduction in two ways:
1.Emphasise advantages of product purchased
stressing disadvantages of forgone alternatives
2.Show many characteristics of chosen product
similar to products forgone but are approved by
reference groups.
The salesperson provides information that helps
the buyer rationalise the decision to buy.
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