DISTRIBUTION MANAGEMENT SESSION 2: PERSONAL SELLING, TYPES OF SALES MANAGEMENT POSITIONS, THEORIES OF PERSONAL SELLING AND STRATEGIES OF PERSONAL

SELLING
Prepared by: Dhaval Motwani

Personal selling

Personal selling refers to personal communication with a an audience through paid personnel of an organization or its agents in such a way that the audience perceives the communicators organization as being the source of the message.

Evolution of Personal Selling

Peddlers selling door to door . . . served as intermediaries Selling function became more structured

As we begin the 21st century, selling continues to develop, becoming more professional and more relational

Business organizations employed salespeople

Selling function became more professional

Contribution of Personal Selling

Towards the Society

Salespeople help stimulate the economy Salespeople help with the diffusion of innovation

Towards the Employing firm

Salespeople generate revenue Salespeople provide market research and customer feedback Salespeople become future leaders in the organization

Towards the customer

Salespeople provide solutions to problems Salespeople provide expertise and serve as information resources Salespeople serve as advocates for the customer when dealing with the selling organization

Objectives of Personal Selling

Qualitative objectives

To do the entire selling job. 2) To service existing accounts. 3) To search out and obtain new customers. 4) To secure and maintain customers co-operation in stocking and promoting the product line. 5) To keep customers informed on changes in the product line and other aspects of marketing strategy. 6) To assist customers in selling the product line. 7) To provide technical advice and assistance to customers. 8) To assists with the training and middlemens sales personnel. 9) To provide advice and assistance to middlemen on management problems. 10) To collect and report market information of interest and use to company management.

Quantitative objectives
)

To capture and retain a certain market share. 2) To obtain sales volume in ways that contributes to profitability. 3) To obtain some number of new accounts of given types. 4) To keep personal selling expenses with in set limits. 5) To secure targeted percentage of certain accounts business

Types of Selling

Industrial selling Retail selling Services selling

Industrial Selling:
More

popularly known as Business-to-business selling 4 major categories

Selling

to retailers: objective here is to gain maximum shelf space and higher point-of-purchase display. eg. Hero cycles, T-series Selling to business users: sales of first firm to the second firm which is a business customer so product is utilised for production of a final good. Eg. IBM selling Pentium processors to Compaq Institutional selling: selling products to institutions for daily use, products used provide support to the buyers business rather than producing his goods. Eg. Xerox photocopiers Selling to governments: selling only to government undertakings which follows a different procedure

Retail Selling:
Selling

to the ultimate customer for end use or consumption Here , a buyer seeks a seller Eg: Shoppers stop, Walmart, Big Bazar, Khodiyar Provision store

Services Selling:
Intangible

in nature Eg: Insurance, travel experience, tourism Cannot be stored or re-sold at a later date

Types of Selling
Order takers Insideorder taker Delivery salespeopl e Outside order taker Missionary salespeople New Business salespeople Organization al sales people Consumer salespeople Technical support salespeople merchandisers

Order creators

Selling function

Front-line sales people Order getters Sales support salespeople

Types of selling

Order takers
Inside

order taker: retail sales assistants whose role is to complete the transaction Delivery sales person: sales people whose job is to deliver the goods and in some cases to install it Outside order takers: those whose job is to visit customers, provide demonstration of the product if necessary and take orders only. Eg. Eureka Forbes people

Order creators
Missionary

salespersons: those who do not close a sale but persuade the customers, educate and make aware the customers and to promote a sellers brand. Eg: medical representatives

Order getters: people who actually make sales by going door-to-door

Frontline salespeople: who go door-to-door to make sales

New business salespeople: who persuade new buyers and non users to buy the product Organizational salespeople: the industrial sellers who try to establish and nurture a long term relationship with the organizational buyers, generally helped by a support staff sales team Consumer salespeople: go door-to-door to sell spices, eatables, insurance etc

Sales support salespeople: those who provide support to the sales people
Technical support salespeople: provide support to the sales people when the product is complex or needs negotiations demanding financial attention of the company Merchandisers: provide sales support in retail and wholesale selling situations

Sales management positions

CEO/ Presiden t

VP sales/VP Marketing

National Sales Manager Regional/Zonal/Divisional/Sal es Manager Branch/Area/District Sales Manager

Sales trainee/sales person/ sales representative

Sales management positions

Top level:

National level and above Responsible for long term marketing and sales planning, scanning external environment, setting long term and short term objectives, developing strategies, decision making and coordination. Mostly the title of regional, zonal or divisional sales managers Responsible for managing several branches or districts and implementing the strategies and action plans approved by the top management. Titles of branch sales managers, area sales managers or district sales managers Directly responsible for sales goals and objectives Day to day supervision of sales persons below them Sales training manager, customer service manager, sales co-ordination manager etc They have an advisory role and do not have any authority on live sales managers and sales force.

Middle level:

First line sales managers:

Stall sales management positions

Personal selling Strategies

Stimulus Response Selling Mental States Selling Need Satisfaction Selling Problem Solving Selling

Stimulus Response Selling

Salesperson Provides Stimuli

Buyer Responses Sought

Continue Process until Purchase Decision

Mental States Selling

Attention

Interest

Conviction

Desire

Action

Need Satisfaction Selling

Uncover and Confirm Buyer Needs

Present Offering to Satisfy Buyer Needs

Continue Selling until Purchase Decision

Problem Solving Selling

Define Problem

Generate Alternative Solutions

Evaluate Alternative Solutions

Continue Selling until Purchase Decision

Consultative Selling
Business Consultant

The process of helping customers reach their strategic goals by using the products, service, and expertise of the selling organization.

Strategic Orchestrator

Long-term Ally

The Sales Process

Initiating Customer Relationships

Developing Customer Relationships

Enhancing Customer Relationships

Sales Presentation Delivery Prospecting Earning Customer Commitment Pre-approach Presentation Planning Approaching the Customer Adding Value through Followup, Self-leadership, and Teamwork

Sales process cont...

Prospectin g& qualifying
Identify qualified potential customers

Preapproac h
Learn as much as possible about customer

Approac h
Make a relationship

Presentation & demonstratio n

Tell the product story & focus on customer benefits

Handling objection s
Overcome customer objections

Closing
Ask for an order

Followup

Prospecting:

Can be an individual, family, organization etc Has the need and the ability to buy Hot prospects, warm prospects and cold prospects Involves information gathering, planning the sales call, setting the sales call, The actual meeting with the customer Important and can make or break the sale Very important Involves conveying the highlights of the product to the customer Arousing the need and convincing him Use of technology, adaptability of the presentation, benefit plan, use of language & convincing Use of demonstration if required Matching the presentation method with situations Convincing the customer and making him believe the worthiness of the product Overcoming objections (psychological and real/logical)

Pre-approach:

Approach:

Presentation delivery

Earning customer commitment

Closure of sale
Asking

for the order Proper timing important Understand the buying signals
Examines

the product Asks another persons opinion asks a question Becomes friendly

After sales follow up and service

Helps

to build relationship Satisfaction here leads to customer delight Good brand reputation and leads to repeat sales Helps to build loyalty among customers

Theories of selling

Selling is an art as well as a Science

AIDAS

theory right set of circumstances theory Buying formula theory

AIDAS theory:

A attention
Beginning of the conversation/interview First impression important Proper attire, neatness, friendliness, and genuine smile A good way of greeting and slowly bring up the actual topic to the customer

I Interest
Aids to generate interest in the products like flip charts, ppts or even a demonstration Generally hints dropped by the prospect which should be picked by the salesperson. This helps in selecting the best approach This skills comes with experience Care to be taken about the timings, mood and relation with the customer

- Desire:

Making

the buyer ready to pay Face and solve the sales obstacles and queries Proper anticipation of sales objections helps
A-

Actions

Buying

action has to be induced Asking for the order

S

- Satisfaction

Reassurance

that the decision is right Means thanking the customer for the order and a promise of proper after sales service

Right set of circumstances theory:

Particular

circumstances cause the prospect to respond in a predictable way during the sales process The sales person must be able to gain advantage of this Internal and external factors decide the circumstances Internal will be the thoughts of the prospect, mood, psychology, beliefs, tensions External will be the place, timings, appearance of the sales person etc.

Buying formula theory

Focus on what lines is the buyer thinking Internal factors given much importance as they have the most likely effect on the thinking
Product service and /or Trade name

Need/problem

purchase

satisfaction

When a need/problem is recognised, buyer thinks of a solution in terms of the product, service or the brand name Proceeds mentally from the need, to product/service, to trade name, to purchase and ultimately the satisfaction or dissatisfaction

Adequacy & pleasant feelings Product service and Need/problem purchase /or Trade name

satisfaction

When a person is satisfied or has found a solution he