Chapter 16

Personal Selling and Sales

Promotion
Personal Selling

•Personal selling is the interpersonal part of the promotion mix and can include:
• Face-to-face communication
• Telephone communication
• Video or Web conferencing
Personal Selling
The Nature of Personal Selling
Salespeople are an effective link between the company and its customers to
produce customer value and company profit by
• Representing the company to customers
• Representing customers to the company
• Working closely with marketing
Managing the Sales Force

Sales force management is the analysis, planning, implementation, and control of

sales force activities.
 Managing the Sales Force

Designing Sales Force Strategy and Structure

Territorial sales force structure

Product sales force structure

Customer sales force structure

Managing the Sales Force

Designing Sales Force Strategy and Structure

Territorial sales force structure: each salesperson is assigned an exclusive
geographic area and sells the company’s full line of products and services to all
customers in that territory.
• Defines salesperson’s job
• Fixes accountability
• Lowers sales expenses
• Improves relationship building and selling effectiveness
Managing the Sales Force

Designing Sales Force Strategy and Structure

Product sales force structure: each salesperson sells along product lines.
• Improves product knowledge
• Can lead to territorial conflicts
Managing the Sales Force

Designing Sales Force Strategy and Structure

Customer sales force structure: each salesperson sells along customer or industry
lines.
• Improves customer relationships
Managing the Sales Force

Designing Sales Force Strategy and Structure

Sales Force Size
• Salespeople are one of the company’s most productive and expensive assets.
• Workload approach to sales force size refers to grouping accounts into different
classes to determine the number of salespeople needed.
Work load method
• It is assumed that all salesperson should shoulder equal work loads
• Total work load involved in covering the company’s entire market is
estimated and then this is divided by the workload that an individual
salesperson should be able to handle.
• Six steps in applying the work load approach are as follows:

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1. Classify customers, both present and prospective,
into sales volume potential categories
1. Class A, Large 150 accounts
2. Class B, Medium 220
3. Class C, Small 510…..Total 880
2. Decide on length of time per sales call and desired
call frequencies on each class
1. Class A: 60 min./call * 52 calls/yr = 52 hrs/yr.
2. Class B: 30 min./call*24 calls/yr = 12 hrs/yr.
3. Class C: 15 min./call*12 calls/yr = 3 hrs/yr.

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3. Calculate the total work load involved in covering the
entire mkt.
 Class A: 150 accounts* 52 hrs/yr. = 7800 hrs
 Class B: 220 accounts*12 hrs/yr. = 2640 hrs
 Class C: 510 accounts* 3 hrs/yr. = 1530 hrs
 Total = 11970 hrs
4. Determine the total work time available per
salesperson
Suppose mgt. decides that salespeople should work
40 hrs per week, 48 weeks per yr, then
40 hrs/week * 48 weeks = 1920 hrs/yr.

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5. Divide the total work time available per salesperson
by task.
assume that mgt. specifies that sales personnel
should apportion their time as follows
Selling task 45 % 864 hrs
non selling task 30 % 576 hrs
Travelling 25 % 480 hrs
total 1920 hrs

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6. Calculate the total no. of salespeople needed.
11970hrs/864 hrs = 14 salespeople needed

• This approach is attractive to practicing sales

executives
• Easy to understand and easy to apply.
• IBM, AT&T have used this approach.
• Disadvantage: it does not consider profit in
calculations

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Managing the Sales Force
Designing Sales Force Strategy and Structure

• Outside sales force (field sales force) are salespeople who travel to call on
customers in the field.
• Inside sales force are salespeople who conduct business from their offices via
telephone, online and social media interactions, or visits from prospective buyers.
• Team selling involves Using teams of people from sales, marketing, engineering,
finance, technical support, and even upper management to service large,
complex accounts.
Managing the Sales Force
Recruiting and Selecting Salespeople

• Careful selection and training increases sales performance.

• Poor selection increases recruiting and training costs, leads to lost sales, and
disrupts customer relationships.
 Managing the Sales Force

Training Salespeople
• Goals of training
• Customer knowledge
• Selling process
• Knowledge of products, company, competitors
Managing the Sales Force

Compensating Salespeople

Fixed Variable
amounts amounts

Fringe
Expenses
benefits
Managing the Sales Force

Supervising and Motivating Salespeople

• The goal of supervision is to help salespeople work smart by doing the right
things in the right ways.
• The goal of motivation is to encourage salespeople to work hard and energetically
toward sales force goals.
Managing the Sales Force

Supervising and Motivating Salespeople

Managing the Sales Force

Supervising and Motivating Salespeople

• Sales morale and performance can be increased through
 Organizational climate
 Sales quotas
 Positive incentives
 Sales meetings
Managing the Sales Force

Evaluating Salespeople and Sales Force Performance

Sales reports Call reports Expense reports

The Personal Selling Process
 The Personal Selling Process
Steps in the Personal Selling Process
•Prospecting identifies qualified potential customers through referrals from:
• Customers
• Suppliers
• Dealers
• Internet
The Personal Selling Process
Steps in the Personal Selling Process
•Qualifying involves identifying good customers and screening out poor ones by
looking at
• Financial ability
• Volume of business
• Needs
• Location
• Growth potential
The Personal Selling Process
Steps in the Personal Selling Process
•Pre-approach is the process of learning as much as possible about a prospect,
including needs, who is involved in the buying, and the characteristics and styles of
the buyers.

Objectives Approaches

• Qualify the prospect • Personal visit

• Gather information • Phone call
• Make an immediate sale • Letter/e-mail
The Personal Selling Process

Steps in the Personal Selling Process

•Approach is the process where the salesperson meets and greets the buyer and
gets the relationship off to a good start and involves the salesperson’s:
• Appearance
• Opening lines
• Follow-up remarks
 The Personal Selling Process

Steps in the Personal Selling Process

•Presentation is when the salesperson tells the product story to the buyer,
presenting customer benefits and showing how the product solves the customer’s
problems.
The Personal Selling Process

Steps in the Personal Selling Process

Handling objections is the process where salespeople resolve problems that are
logical, psychological, or unspoken.
 The Personal Selling Process

Steps in the Personal Selling Process

Closing is the process where salespeople should recognize signals from the buyer—
including physical actions, comments, and questions—to ask for a order and finalize
the sale.
The Personal Selling Process

Steps in the Personal Selling Process

Follow-up is the last step in which the salesperson follows up after the sale to
ensure customer satisfaction and repeat business.
The Personal Selling Process
Steps in the Personal Selling Process
Personal selling is transaction-oriented to close a specific sale with a specific
customer.
The long-term goal of personal selling is to develop a mutually profitable
relationship.
Sales Promotion

Sales promotion refers to the short-term incentives to encourage purchases or

sales of a product or service now.
Sales Promotion
Rapid Growth of Sales Promotion
• Product managers are under pressure to increase current sales.
• Companies face more competition.
• Competing brands offer less differentiation.
• Advertising efficiency has declined due to rising costs, clutter, and legal
constraints.
• Consumers have become more deal-oriented.
Sales Promotion

Sales Promotion Objectives

Setting sales promotion objectives includes using:
• Consumer promotions
• Trade promotions
• Business promotions
• Sales force promotions
Sales Promotion
Major Sales Promotion Tools
Samples offer a trial amount of a product.
Coupons are certificates that give buyers a saving when they purchase specified
products.
Rebates are similar to coupons except that the price reduction occurs after the
purchase.
Price packs offer consumers savings off the regular price of a product.
Sales Promotion

Major Sales Promotion Tools

Premiums are goods offered either for free or at a low price.
Advertising specialties are useful articles imprinted with the advertiser’s name,
logo, or message that are given as gifts to consumers.
Point-of-purchase promotions include displays and demonstrations that take place
at the point of sale.
Sales Promotion
Major Sales Promotion Tools
Contests, sweepstakes, and games give consumers the chance to win something—
such as cash, trips, or goods—by luck or through extra effort.
• Contests require an entry by a consumer.
• Sweepstakes require consumers to submit their names for a drawing.
• Games present consumers with something that may or may not help them win a
prize.
Event marketing or event sponsorship is creating a brand-marketing event or
serving as a sole or participating sponsor of events created by others.
 Sales Promotion
Major Tools for Trade Promotions

Specialty
Discount Allowance Free goods
advertising
Sales Promotion

Major Sales Promotion Tools for Business Customers

Conventions and trade shows are effective to reach many customers not reached
with the regular sales force.
Sales contests are effective in motivating salespeople or dealers to increase
performance over a given period.
Sales Promotion

Developing the Sales Promotion Program

• Size of the incentive
• Conditions for participation
• Promotion and distribution of the program
• Length of the program
• Evaluation of the program