Business Marketing VTU,Module 8

SALES & RETAIL MANAGEMENT

By Prof. Raghavendran.V


SADMAN

Sales management is defined as “ the effective planning, directing and control of personal selling, including recruiting, selecting, equipping, assigning, routing, supervising, paying and motivating as these tasks apply to personal sales force.


MANAGING THE SALES FORCESales force is mainly responsible for the

sale of the products of a company and add to profit to the business operations and fulfill social obligations.

Sales force mgmt means: The right organization & aggression

against the product lines and geographies.

The right strength and qualification. The right compensation and incentive

system.


STEPS IN DESIGNING AND MANAGING A SALES FORCEo Objective trainingo Training the sale policies.o Designing sales force,

Structure & Sizeo Deciding sales force

Compensationo Recruitment & selecting sale forceo Guiding and motivating sale forceo Performance rating of the sales force.


SALES MANAGER DUTIES AND RESPONSIBILITIESSM is the most important person in a sale

organization. All activities are based on his functions and responsibilities and they are as follows.

Organizing sales research, product research.

Getting the best output from the sales force under him.


Setting & controlling the targets, territories, sales experiences, distribution expenses.

Advising the company on various media, sales promotions and schemes.

Monitoring the company’s sales policies.


MR. ALAN REID TERRITORY SALES MANAGER JOB RESPONSIBILITY

To yourself To your company To your customers

Increase basic selling skills

Be proud of your association with your company

Work closely with decision takers and influencers in each account

Develop management abilities

Maintain the company standing & standards with all customers

Point out the advantages of an association with your company.

Keep pace with changes, trends and developments in your territory

Inform HQ and supervisors, through establishment channels, about changes and development in your territory

Keep a/c’s current and up-to-date on all company advertising and promotional activities.


TERRITORY SALES MANAGER JOB RESPONSIBILITY To yourself To your company To your

customers

Study the latest products, promotion policies and procedures

Be prompt in handling records, reports and correspondences.

Suggest ideas, methods, techniques and tips that cam stimulate sales.

Be alert to new sales and merchandising ideas

Cut selling costs by economical routing, good use of time, planning and greater awareness of opportunity

Inform the customers about the trends in their areas.

Grow, so that you can assume greater responsibilities as opportunities permit

Check demand and movement of products in the territory

Handle complaints effectively and to the complete satisfaction of the complaints.


TERRITORY SALES MANAGER JOB RESPONSIBILITY

To yourself To your company To your customer

Maintain the appearance and goodwill expected of a territory sales manager.

Report activities of the competitors

Suggest the best technique for selling your products to the customers.

Analyze your weakness and strong points and then think about them

Strive to reach the best goals

Organize presentations to inform and save time.

Ask for the help, when you need it.

Make the customers aware of the changes in the company’s policies and procedures

Cooperate with other departments of the company

Stimulate and maintain enthusiasm for your products build & maintain goodwill.


PROBLEMS IN SALES FORCE MANAGEMENTDesigning and managing sales force

Sale force authorityTarget settingSales forecasting.


FORMULATION OF SALES STRATEGYThe following are key decision areas in

sales management which are particularly relevant to strategy formulation.

Determining the size of the sales force Decision regarding type and quality of

the sales force required Designing the sales organization Territory designing Recruitment and training procedures Task allocation


Compensation of sales force Performance appraisal and control

system Feedback mechanism to be adopted Managing channel relationships Coordination with marketing

departments


DIFFERENT SALES STRATEGIES Relationship strategy The double-win strategy Instant service Hard sell Vs Soft Sell Strategy Integrated Sale Strategy Client centered selling strategy


METHODS OF SELLING Telemarketing: selling concepts on the

phone Sales on the internet Mail order sales Sales through large scale fixed shop

retailers Sales through wholesalers and retailers Direct selling


ASSIGNMENT TIME Study concern from the following area

Two wheeler Three wheeler Four wheeler Furniture Petroleum products Mobile

Using internet tools & resources, make a 15 companies involved in selling FMCG through internet and bring out strategies used by them.


PRESENTATIONMake a presentation by

incorporating ingredients of sales concepts for a sick product of any company.

Presenting day on 26th Aug’


PERSONAL SELLING



PERSONAL SELLINGPersonal selling can be defined as follows:

Personal selling is oral communication with potential buyers of a product with the intention of making a sale. The personal selling may focus initially on developing a relationship with the potential buyer, but will always ultimately end with an attempt to "close the sale"


PERSONAL SELLINGImportant aspects of personal selling are:• It enhances customer’s confidence in the

seller• It promotes long term business relations

through personal intimacy• It provides a human touch to business

transactions.• It helps facilitate the seller to understand

each customer’s needs and preferences more clearly

• It helps satisfy a customer by modifying the product as per customer’s choice and preference.


PERSONAL SELLING• Personal selling followed by personal

service helps build long term relations between the business and the customer

• It helps keep up with the competition in the market, based on product customization as per customer’s preferences.

• It is a powerful and effective tool for convincing the customer about the product

• Through PS the time lag between introducing a product through the media and actually selling it is reduced.


PERSONAL SELLING• It provides prospective customers with a

better understanding of the product and an interactive opportunity to liaise with the sales personnel.

Changing face of personal selling: Value sharing Relation building Role playing Changing approach


EFFICACY OF PS:PS with Respect to product strategy

PS and pricing decisionsPS and distributionPS and product promotion


STEPS IN PS:Prospect

ingPre

approach

Approach

Presentation & Demonstratio

n

Handling objectives Closing

Follow up


PROSPECTINGIt is process of identifying buyers of the

product.Different ways to identify prospects

Acquaintance references Cold calling Centre of influence method Personal observation method Direct mail/ telephone method Company’s records Newspapers Retailers Other methods


PRE-APPROACH, SIGNIFICANCE Salesman concentrates only on the

prospects and not suspects, thus saving time and energy.

Helps a salesman to gain all possible knowledge about the prospects before approaching. (loose talk can be avoided).

Sales presentation effectively, efficiently and confidently.

Focused, meaningful and to the point.


APPROACHINGSalesman has an opportunity to

understand and interact with the prospect in better way. Hence, the salesman should put forward his best efforts to make use of the opportunity.

Stages of approaches: Approach adopted Successful adopted Method of approach


APPROACH ADOPTEDSalesman are two types and they are:• Travelling salesman• Counter salesman

The approach adopted by the each of these salesmen is obviously different.

Approach adopted by travelling salesman:The different way to gain access and thus

interview the prospects.


APPROACH ADOPTED Direct approach Seeking an appointment with a prospect

could by sending an advance mailer explaining his product

Seeking an appointment through reference given by friend, relative or business prospective.

Give gifts and secure an appointment. Sales letter


SUCCESSFUL APPROACHIt is said approach will be successful if it

attains below said objectives.1. Successful approach enhances the sale

and it is thus important for the running of a business..

2. Failed approach will give an opportunity to the competitor.

3. Enlightening the prospect by providing him ample information about the product and services


SUCCESSFUL APPROACHGuidelines for successful approach are Prior appointment Timing Command Relaxed atmosphere Open mindedness Courtesies Effective presentation Follow up


METHOD OF APPROACH Cashing in on Brand Name or the

company’s reputation Customer Benefit approach Innovative product opens the door to

the salesman The premium approach The shock approach The approach of “making the prospect

feel important” The survey method Interactive approach


PRESENTATIONPrompt quick presentation creates an

impressionWell organized articlesExplain features of products and price

advantage ( an Intelligent Salesman will never compare rival products)

Show quality productDemonstrating product will +ve

impressionProduct appeal


DEMONSTRATION & CLOSEIt is an exercise to prove the

characteristics of the product. It is imperative and essential for a prospect to make a buying decision.

The main aim of the close is to convince the prospect to sign the order form, to place an order immediately rather than future.


THEORIES OF PSThe main theories of personal selling are

1. AIDAS Theory2. Right set of Circumstances

Theory3. Buying Formula theory


AIDAS:This theory is based on the premises that

during a sales presentation, the prospect consciously goes through five different stages:

Attention Interest Desire ActionSatisfacti

on

Stages of AIDAS Theory


AIDASAttention: The sales person should attract

the prospect to his presentation before actually goes into the details of the same.

SP should involves the prospect’s mind in the presentation, his total may go unnoticed or registered.

Interest: SP should ensure that the prospect remains glued to his presentation throughout its length


AIDASDesire: SP is responsible to create strong

desire in prospect’s mind to purchase the product. SP should consciously bring prospect into the stage of readiness to the buying the product.

Action: SP is successful in 3 stages, SP induces to buy the product. Here important task for SP to help his prospect in taking final decision.

Satisfaction: After placing an order or buying product, SP should appreciate the prospect for the decision.


RIGHT SET OF CIRCUMSTANCES THEORYThe theory opines that all circumstances,

which led to the sales were appropriate or “right” for the sales to have taken place.

In other words, if the SP is successful in securing the prospect’s attention, maintaining his interest and including his desire to buy the product.

( SP is highly skilled then higher sales and viceversa)


BUYING FORMULA THEORYThis theory emphasis is on the buyer,

problems of the buyer and SP assist buyer in finding appropriate solution to the problem.

This theory based on the analysis of the sequel of the events goes on in buyer’s mind during the presentation

The following graphical representation will

help you learn better.


BUYING FORMULA THEORY

Need Solution Purchase

(a) For one time purchase

Need Solution Purchase Satisfaction

(b) For continuous relational ship


ASSIGNMENT TIMEDifferentiate b/w advertising and publicity.

Highlight the role of public relations and personal selling in pharmaceuticals, medical equipments.

Explain out personal selling process, how would presentations differ in the following cases and Role Play: One each for all

Selling insurance products, office computers,

Beverages, electrical generators, foot wares,

Banking products, home appliances and tobacco products.

3rd Sept’ 2011 submission


SALES ORGANIZATION

By Prof. Raghavendran V


SALES ORGANIZATION

Organization means the systematic coordination of the functions essential to achieving organization objectives. The functions of sales organization can be classified as follows:


FUNCTIONS OF THE SALES ORGANIZATIONPlanning Function

Sales forecastingSales budgetingSelling policy

Administrative FunctionSelecting salesmanTraining salesmanControl of salesmanRemuneration of salesman

Executive functionSales promotionSelling routine- execution of customer’s order


ROLE OF SALES ADMINISTRATIONTotal customer satisfaction by

way of prompt and safe deliveryProper maintenance of stock

ensuring defect free delivery to customers

Effective coordination and communication between regional offices and dealers.


ROLE OF SALES ORGANIZATION1. Define line of authority2. Ensure all necessary activities

are assigned & performed3. Establish line of communication4. Provide for coordination and

balance5. Provide insights into avenues of

advancement6. Economics of executive time


DEVELOPING A SALES ORGANIZATIONDevelopment refers to formal,

coordinating process of communication, authority and responsibility for sales groups & individuals

The 5 major issues are1. Formal & informal Organizations2. Horizontal & vertical3. Centralized or decentralized4. The line and staff components of

organizations5. The size of the company

Ask student to draw diagram


FIELD SALES ORGANIZATIONi. Geographic sales specialization

organizationii. Product based sales specialization

organizationiii. Customer based specialization

organizationiv. Activity/ function based

organizationv. Hybrid organizationvi. Team based organization


GEOGRAPHICAL SALES ORGANIZATION

FMCG SALES

West division

Area manager- Mumbai

Area manager- Baroda

Central division

Area manager- Nagpur

East division

Area manager- Kolkata


PRODUCT BASED SALES ORGANIZATION

UB Breweries

Rum

Area East

Area South

Area north

Beer

Area West

Area central

Whisky

Area North east

Area South west


CUSTOMER BASED SALES ORGANIZATION

IBM

IBM- Daksh

Xerox

Pearson

IBM- India

Bank of America

Golden sachs


ACTIVITY/ FUNCTION BASED ORGANIZATIONProspecting

Presentation

service

Telemarketing/ cold calls

Face to face sales

Personal visits


HYBRID SALES ORGANIZATION

President

VP- production

VP- Marketing

Sales Manager-

north

Manager- consumer division

Manager- industrial division

Sales Manager-

south

VP- finance

Functional

Geographical

Customer


TEAM BASED SALES ORGANIZATION

customer

Technical support

Marketing Manufacturing

Sales


ASSIGNMENT TIME

Explain all field sales organizations with example each.

Brief out developing sales organizations with figures.

Highlight by points about functions of sales organization


END OF MODULE 1 IN SALES MANAGEMENT, END OF MODULE 8 IN INDUSTRIAL MARKETING


Business Marketing VTU,Module 8

Education

Transcript of Business Marketing VTU,Module 8