Personal Selling

Personal Selling

Personal communication of information to persuade consumers to buy the product or service

Personal selling is preferred when– market is concentrated– the product has high unit value; technical; not

standardized– introductory stage in PLC

Characteristics of personal selling

Advantages of personal selling– flexible communication – focused on prospective customers– with sales goal– long-term relationship with consumers

Disadvantages of personal selling– high cost– difficulty of managing sales force

Scope of personal selling Inside personal selling

– customers approach sales people– e.g., retail-store selling; telephone order taking

Outside personal selling– salespeople go to customers – Type of contacts

» personal contact» telephone» mail

– Type of customers» business buyers» intermediaries» consumers

Personal selling process

ProspectingPostsaleservice

PresentationPreapproach

Identifying

Qualifying

Information

Habit

Preference

AIDA

AttentionInterestDesireAction

Reduce dissonance

Build goodwill

Personal selling process: Prospecting

Identifying prospective customers– identifies specific individuals or firms that may

be potential customers Qualifying the prospects

– determines whether prospect consumers have the willingness to buy, purchasing power, and authority to buy

Personal selling process: Preapproach to individual prospects

Finding out prospect’s buying behavior and preferences

Finding out organization buying decision process in business-to-business selling

Personal selling process: Presenting the sales message

AIDA (Attention, Interest, Desire, and Action)– attract attention– hold the prospect’s interest– build a desire for the product– stimulate the action of closing the sale

Personal selling process: Postsale services

Checking delivery, financing, installation, and other areas that might be related to consumer satisfaction

Dealing with cognitive dissonance– summarizing the product’s benefits after the purchase– repeating why the product is better than alternatives

not chosen– emphasizing how satisfied the will be with the product

Topic 23

Sales Force Management

What makes a good salesperson?

What makes a good salesperson?– It is difficult to define traits that make a good

sales person– Different sales job involves different selling

tasks -- and require different skills and need different personality traits

What makes a good salesperson?

Ability– skills

– knowledge

Motivation– financial

– non-financial

Ability

Mot

ivat

ion

high

low

high

low

Staffing and operating sales force

Recruitment and

SelectionMotivationTrainingAssimilation

PerformanceEvaluation

SupervisionCompensation

Staffing and operating sales force: Recruitment and selection (cont.)

1. Determining hiring specification– defining the number and type of people wanted– job analysis and job description

2. Recruiting applicants

3. Selecting sales people– interviews, formal tests (sales attitude, analytical

and organizational skills, personality traits, etc), past employment history, references

Staffing and operating sales force: Assimilation/ Training

Assimilation– the process in which new sales people are integrated

into the company Training

– to learn consumers’ need, buying motives, buying habits– to learn competitor’s characteristics and strategies– to enhance and refine selling skills– to learn about products– to improve time and territory management

Staffing and operating sales force: Motivation

Type of motivation– Financial incentives

» compensation plans

» expense accounts

» fringe benefits

– Nonfinancial awards

Staffing and operating sales force: Compensation

Direct monetary payments– Strait salary

» fixed payment for a period of time» provides security and stability for sales force» not enough incentive for sales increase

– Strait commission» payment tied to a specific unit of accomplishment

– Combination plan Indirect monetary compensation

– paid vacation, pension, insurance plans

Staffing and operating sales force: Supervision

Supervising sales force is difficult because:– sales people often work independently– the relationship between sales effort and sales

outcome is not clear

Staffing and operating sales force: Performance Evaluation It is difficult to evaluate a salesperson’s

performance– Output = f (salesperson’s effort, environment)

Qualitative evaluation bases– knowledge of product, company policies, and

competition– Time management and preparation for sales calls– customer relations– personality and attitude

Staffing and operating sales force: Performance Evaluation

Quantitative evaluation bases– Quantitative input measures

» Call rate, direct selling expenses, non-selling activities

– Quantitative output measure » sales volume, sales volume as a percentage of quota,

gross margin, orders, closing rates, accounts

Staffing and operating sales force: Performance Evaluation

Sales Output

Sales person’sability

Sales person’smotivation

Sales environment

Sales effort

Video Case: Rollerblade

Promotional strategies in introductory stage– Promotional goals

– Non-traditional promotions

– Traditional promotions

Video Case: Rollerblade

Marketing strategies in growth/maturity stage– Targeting

– Price