Introduction To Sales Management

Sarika Ahlluwalia, Asst. Prof.
, GIBS, New Delhi
Only department that generates revenue

Sales personnel firms link to the customers
Should have Professional approach with
Effective Analysis
Sales Objectives
Strategies
Control
Sarika Ahlluwalia, Asst. Prof., GIBS, New Delhi
The Planning, Direction and Control of

Personal Selling, Including recruiting ,
selecting, equipping, assigning, routing,
supervising, paying and motivating as these
tasks apply to the personal sales force.
American Marketing Association
Sales Volume
Profitability
Growth
Before industrial revolution

Small scale manufacturers were dominating the
economy
Selling to nearby customers was done
Industrial Revolution
Began in England during 1760 AD
Large scale manufacturing organisation started
dominating the economy
Separate functional departments were established
Large scale manufacturing : selling in the nearby

market was not sufficient, need to expand the
market arise
Involvement of wholesalers, retailer
Advertising,
sales
promotion,
shipping
and
dispatching became important and complex
Marketing function got split into sales functions and
other support functions
Integration with marketing management

Part of marketing management
Sales Planning should be integrated with marketing
planning
Marketing Team
Field Selling/ Personal Selling Team
Contacting existing & prospective customers
Head Quarter Marketing Team

Performs support and service functions to assist field
sales people in their jobs
The headquarter based service and support

functions:
Promotion: advertising, sales promotion, public

relations, publicity and direct marketing
Marketing
Research:
Collecting
&interpreting
information on customers, competitors, products &
markets
Market Logistics: Physical distribution of finished
goods: warehousing, inventory, transportation &
order processing
Customer service: Pre-sales & Post sales, delivery
services to existing &prospective customers
Co-ordination: co-ordination between customers,
sales force & production
Head-Marketing
ManagerPromotion
Manager
Market
Research
Manager
Sales
Manager
Market
Logistics
Manager
Customer
Service
Some functions can be outsourced

Harmonious relationship with common goals
10
Relationship Selling
Transactional
Relationship
Selling
Value
/ Relationship
Selling
added Collaborative
/ Partnering
Relationship
Selling
/
/
Working relationship
Creation of customer loyalty through relationship
marketing
Salespeople concentrate their team selling efforts
on building trust and service on a few carefully
selected customers over a long period with a aim of
becoming a preferred or sole supplier
11
Transactional Relationship / Selling:
Customers with low sales & profit potential &

business with low priced & low profit products
(Movies , Restaurants, grocery stores)
Focus on single transaction
customers are not contacted again & relationship is not extended
Value added Relationship / Selling:
Customers with medium sales & profit potential

(Cars)
Focus on understanding current and future needs of customers
and meeting those needs better than competitors with value
added solution to their problems
After sales customers are contacted again to find out if the
customer is satisfied.
12
Collaborative Relationship :
A selling methodology and mindset where the
seller, acting as a trusted advisor, assists the
buyer in identifying needs and offering solutions
within their relationship.
The role of salespeople is very important in the
companys relationship marketing programme.
Sarika Ahlluwalia, Asst. Prof., GIBS,

New Delhi
13

New Delhi
14
Varying sales responsibilities:

New Delhi
15
1) Two-way flow of communication

2) between a buyer and seller
3) a face-to-face or real time encounter

New Delhi
16
Person-to-person communication with a

prospect.
It is a process of developing
relationships, discovering needs, matching
appropriate products to these needs, and
communicating benefits through informing,
persuading, and reminding.
17
Selling & Marketing Era

Marketing Era
(Middle 1950s 1960s)
Selling Emphasis
Customer orientation replaces product orientation
Determine needs & wants of target markets &
adapt to deliver customer satisfaction
Consultative Selling Era

Mass market changed into target market
(Late1960s Early 1970s) Emphasis on need identification
Information sharing replaced manipulations
Strategic Selling Era
(1980s)
Partnering Era
(1990s- Present)
Greater emphasis on niches

More emphasis on planning
Product positioning is vital
Emphasize strategies that create customer value

Sales people are encouraged to consider long
term partnership with customers
18
Prospecting & Qualifying

Pre approach (Pre call Planning)
Approach
Presentation & Demonstration
Overcoming Objections
Trial Close/ Closing the sales
Follow up & Service
19
A prospect: Individual, family or an

Organisation, who needs the product & has
the ability to buy
Sales Lead: Generates the name of a
person/business firm that is a probable
prospect.
Sales lead becomes a prospect once it is
found to have willingness and ability to buy.
To succeed companies must continuously
prospect for new customers
20
Prospects & lead generating methods
Referrals from existing customers

Convincing source, two third of total sales
Referral from internal company sources

Advertisements, direct mail,
shows, tele prospecting etc.
website,
trade
Referral from external sources

Suppliers,
Intermediaries,
associations etc.
bankers,
trade
21

Networking by salespersons
Sales people become members of social clubs to meet

new prospects
Industrial Directories
Yellow Pages
Cold Canvassing
Unannounced calls , used for widely used products.
Standard Industrial Classification System
22

Standard Industrial Classification System
Major secondary data source
Categories economy into:
Different Divisions denoted by a letter code

Major Industry Groups denoted by two digit code
Industry Groups denoted by three digit code
Product Categories denoted by four digit code
For prospecting a company classifies present

customers into specific product categories by using
four digit SIC System.
23
Qualifying: Need , Affordability
Qualified Prospects:
Hot Prospects: Good requirement for the product and
financially sound.
Warm Prospects: Medium to average requirement for the
product and financially sound.
Cold Prospects: Low requirement and financial position
not clear.
Follow up is necessary
80% sales through follow up
40% without follow up
Four calls to convert an initial inquiry into sales
24
In depth Information about the prospects

As much as possible
Corporate clients
Business
Purchase practices
Location
Who takes purchase decisions
Major problems faced by the prospects & the industry
Planning the sales call

Objectives of the sales call
Sales strategy
25
Planning the sales call

Objectives of the sales call
Identification of need
Understanding buying practices/ orientations
Making a sales presentation
Checking merchandise & reorder from the existing
distributor
Sales strategy
When & to whom to approach
Phone call followed by personal visit
26
To make an appointment to see the prospect

Make or break a sale
First impression should be good
Appearance
Attitude
Opening Lines
27
Techniques
Introductory Approach
Introducing himself/herself & the company
Customer Benefit Approach

Identifying major buying motive
Product Approach
When product is new, unique
Question Approach
By asking a question
Praise Approach
A sincere & subtle indirect praise
28
Understanding buyers needs

Knowing the presentation methods
Developing an effective presentation
29
Understanding buyers needs
Logical order of asking questions:
Based on a study of 35,000 sales calls by Niel

Rackham:
Situational Questions:
Who are involved in the buying decision making
Buying for the first time
Making a change from the existing supplier
Problem Identification Questions:
To uncover prospects problems

Problems with the existing suppliers, Quality etc.
Problem Impact Question
To make prospects realise the impact or consequences of

the problem and the need to solve them
30
Solution value Questions

To make the prospects assess the value of a
solution
For e.g. how would an error free system help
Confirmations Questions
To get confirmation from the prospects
For e.g. if I give you the proof that our
component would reduce the rejection rate
to less than 0.5%, would you be interested
Few situational and more questions on

problem identification and impact should
be asked
31
Knowing the presentation methods/ Personal

selling approaches:
Stimulus Response Method

Formula Method
Need Satisfaction Method
Team Selling Method
Strategic Issues Method
Group Presentation Method
Consultative Selling Method
32
Stimulus Response Method

AKA Canned Approach
Used for non technical product
Used by Tele marketing people, door to door sales
men
Sales men fail to identify needs of the prospects
Salesperson
Provides
Stimuli
Buyer
Responses
Sought
Continue Process
Until Purchase
Decision
33
Formula Method: AIDA
Attention
Interest
Desire
Action
34

Interactive sales Presentation
Starts with need identification
Sales presentation follow to show how the product
can solve buyers problems
Done in three ways:
Features
Advantages
Benefits
35

Interactive sales Presentation
Starts with need identification
Sales presentation follow to show how the product
can solve buyers problems
Done in three ways:
Features
Advantages
Benefits
Uncover &
Confirm
Buyer
Needs
Present
Offering to
Satisfy
Buyer
Needs
Continue
Selling
until
Purchase
Decision
36
Team Selling Method
Latest method
Multi person sales team to deal with buying centre
of a firm
Buying Centre
Sales Team
Major Accounts Executive
Technical support engineer Exchange
Logistics Executive
Information System
Executive
Finance Executive
Purchase/ Material
Executive
Operations/Manufacturing
Executive
Logistics/ Supply chain
Executive
Materials manager
Finance Executive
Major Sales Accounts: High Sales & Profit Potential
37
Group Presentation
When a sales team makes sales presentation to a

buying team
Guidelines:
Need Analysis
Introduction
Convincing:
through
experience,
names
of
renowned customers, third party certification,
quality assurance.
Specific Benefits: Ask each person the benefits they
look for in the product
Well prepared: Should answer questions from the
buying team
38
Consultative Selling Method
Problem solving presentation

Buyers have problems
They know they do not have the expertise to solve the
problems, want solution with in their budget
Consultative sales people help
E.g. Software suppliers financial consultants
Three primary roles:
Strategic Orchestrator: Coordinates all of the information,
resources, and activities needed to support customers, before,

during and after the sale.
Business Consultant: Provides professional or expert advice[1]

in a particular area
Long-term Ally
39
Requirements:
Sales people should have in depth knowledge of
customers company, industry & detailed analysis of
Knowledge about the
key members of the
customers buying centre
Proposal to solve customers problems should be
made
Cross functional team should be used, if needed
external sources should be used
Should build long term relationship
40
Developing an effective presentation:

Planning: Setting objectives of each sales call &
presentation
Use Technology: Multimedia presentations
Adapt Presentation: Tailored to situation & client
Benefit Plan: create image in the prospects mind
Dont Overload: avoid telling everything, only
relevant information
Prospects Language: Avoid technical jargons
Convincing: with third party proofs
41
Demonstration
Doubts can be cleared
Questions can be answered
Support selling process
42
Resistance to buy
Psychological (Hidden)
Predetermined beliefs, preference for established
brands, dislike of making decisions, anxiety to
spend money
Logical (Practical/Real)
High Price, Quality, Availability,
43
Overcoming Psychological Objections

Ask questions to keep the communication on
Clarify doubts
Never argue or hurt
Overcoming Logical Objections
Ask questions
Turn an objection into benefit
Deny objections tactfully
Third party certificate
44
Trial Close:
Checks the attitude or ask the opinion
Does not ask for the decision to buy
E.g.
To what extent this product meets your needs
Which of these benefits are important to you
If the prospect respond favourably to the trial questions
Ask to close the sale
If negative response, sales presentation should be
repeated
45
Buying Signals
Examines the products

Ask another persons opinion
Ask Questions
Becomes friendly
46
Closing Techniques:
Alternative choice close: choice between two or more, or

to buy or not to buy
Minor point close: making decision on products minor
points
Assumptive close: assumes that the prospect will buy
the product & convey his assumptions through
comments.
Summary of benefits close: Summarise the benefits and
make a proposal
Balance sheet close
Special offer close
Probability close
Negotiation close
47
Closing Techniques:
Balance sheet close:
Benefits
Improvements
Time Saving
More Models
Less Efforts
EMI
Immediate Delivery
Comparing benefits with improvements required

Special offer close: Discounts, free gifts etc.
Probability close: I will let you know
Negotiation close: Win win deal
48
Sales job does not end after the receipt of

order
Check customer order: if all details like delivery
period, address, advance payment etc. are
mentioned
Follow up visit at the time of delivery: to check if
the product delivered on time, condition,
installation, operating instructions, training etc.
Account penetration: Working and contacting
people through out the account
49
Maintain long term mutually beneficial

partnership with the key customers
Expensive to gain new customers than to
keep existing
Through effective follow up & customer
service
50

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Sarika Ahlluwalia, Asst. Prof.

, GIBS, New Delhi

Only department that generates revenue

Sarika Ahlluwalia, Asst. Prof., GIBS, New Delhi

The Planning, Direction and Control of

Sarika Ahlluwalia, Asst. Prof., GIBS, New Delhi

Sarika Ahlluwalia, Asst. Prof., GIBS, New Delhi

Before industrial revolution

Sarika Ahlluwalia, Asst. Prof., GIBS, New Delhi

Large scale manufacturing : selling in the nearby

Sarika Ahlluwalia, Asst. Prof., GIBS, New Delhi

Sarika Ahlluwalia, Asst. Prof., GIBS, New Delhi

Integration with marketing management

Head Quarter Marketing Team

Sarika Ahlluwalia, Asst. Prof., GIBS, New Delhi

The headquarter based service and support

Promotion: advertising, sales promotion, public

Some functions can be outsourced

Sarika Ahlluwalia, Asst. Prof., GIBS, New Delhi

Transactional Relationship / Selling:

Customers with low sales & profit potential &

Value added Relationship / Selling:

Customers with medium sales & profit potential

Sarika Ahlluwalia, Asst. Prof., GIBS,

Sarika Ahlluwalia, Asst. Prof., GIBS,

Varying sales responsibilities:

Sarika Ahlluwalia, Asst. Prof., GIBS,

1) Two-way flow of communication

Sarika Ahlluwalia, Asst. Prof., GIBS,

Person-to-person communication with a

Sarika Ahlluwalia, Asst. Prof., GIBS, New Delhi

Selling & Marketing Era

Consultative Selling Era

Greater emphasis on niches

Emphasize strategies that create customer value

Prospecting & Qualifying

Sarika Ahlluwalia, Asst. Prof., GIBS, New Delhi

A prospect: Individual, family or an

Sarika Ahlluwalia, Asst. Prof., GIBS, New Delhi

Prospects & lead generating methods

Referrals from existing customers

Referral from internal company sources

Referral from external sources

Sarika Ahlluwalia, Asst. Prof., GIBS, New Delhi

Prospects & lead generating methods

Sales people become members of social clubs to meet

Standard Industrial Classification System

Sarika Ahlluwalia, Asst. Prof., GIBS, New Delhi

Prospects & lead generating methods

Different Divisions denoted by a letter code

For prospecting a company classifies present

Sarika Ahlluwalia, Asst. Prof., GIBS, New Delhi

Qualifying: Need , Affordability

80% sales through follow up

40% without follow up

Four calls to convert an initial inquiry into sales

Sarika Ahlluwalia, Asst. Prof., GIBS, New Delhi

In depth Information about the prospects

Planning the sales call

Sarika Ahlluwalia, Asst. Prof., GIBS, New Delhi

Planning the sales call

Sarika Ahlluwalia, Asst. Prof., GIBS, New Delhi

To make an appointment to see the prospect