CHAPTER 2

Personal Selling and Sales Promotion

Personal selling involves oral conversations, either by telephone or face-to-face, between

salespersons and prospective customers. Personal selling is a two-way communication
involving individual and social behavior. It aims at bringing the right product to the right
customer. It is used for creating product awareness, developing brand preference, negotiating
price, etc.

Personal selling is used extensively in complex and highly technical products like computers,
electronic typewriters, digital phones, microwaves, aqua guard, remote controlled appliances,
etc. It is used for selling to industrial consumers who may be having technical queries and want
to purchase in bulk. The increase in competition from foreign and domestic sources has
increased the importance of personal selling.

It is a direct presentation of a product to a prospective customer by a representative of the

organization selling it. It takes place face to face or over the phone and it may be directed to a
business, person or a final consumer

Contribution of personal selling

• Salespeople generate revenue

• Salespeople provide market research and customer feedback

• 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

• The Four Sales Channels

• Over-the-counter selling: personal selling conducted in retail and some wholesale

locations in which customers come to the seller’ place of business

• Field selling: sales presentations made at prospective customers’ homes or businesses

on a face-to-face basis

• Telemarketing: promotional presentation involving the use of the telephone on an

outbound basis by salespeople or on an inbound basis by customers who initiate calls to
obtain information and place orders

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 • Inside selling: performing the functions of field selling but avoiding travel-related
expenses by relying on phone, mail, and electronic commerce to provide sale

Advantages and Disadvantages of Personal Association

Advantages

Following are the advantages of personal selling because of which it is the most commonly
used promotion tool:

1. Ability to close sales.

2. Ability to hold customer attention.

3. Immediate feedback and two-way communication.

4. Presentation is tailored to individual needs.

5. Ability to target customer precisely.

6. Ability to cultivate relationship.

7. Ability to get immediate action.

Disadvantages

Despite all these advantages of personal selling, it is not without disadvantages because of
which sometimes companies may hesitate to adopt personal selling as a promotion tool.

1. High cost per contact.

2. Inability to reach some customers effectively.

Importance of Personal Selling

• The only function / department in a company that generates revenue / income

• The financial results of a firm depend on the performance of the sales department /
management

• Many salespeople are among the best paid people in business

• It is one of the fastest and surest routes to the top management

Duties and responsibilities of Personal Selling

Some of the Objectives of personal selling are:

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 • To shoulder the entire responsibility of the promotion mix (when no other element of
Promotion mix is used)

• To maintain contact with existing customers, take orders etc (also known as servicing
existing accounts)

• To search and obtain new customers

• To inform and educate customers

• To assist customers in selection

• To provide technical assistance

• To collect market information

Responsibilities of Sales Manager

Sales management involves a number of responsibilities. It is the income producing division of

a business. The sales manager is responsible for:

1. Providing profit contribution

2. Creating a proper image for the company and it’s products/services

3. Achieving the sales targets of the organization

4. Satisfying the customers and participating in marketing activities

5. He is responsible to the customer and society for continuing growth of the organization.

He has multifarious activities, including setting goals and achieving them, building sales
organizations and managing them. These multifarious activities can be listed exhaustively as
below:

1. Identification of sales strategy.

2. Defining the personal selling objectives of the firm.

3. Formulating the sales policies.

4. Deciding the type of the sales force.

5. Deciding the size of the sales force.

6. Designing the sales territories for effective coverage of the area.

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7. Developing a sales organization.

8. Fixing sales quotas and targets.

9. Creating the sales force – i.e., recruitment, selection and orientation of the sales force

10. Managing the sales force:

(a) Compensation

(b) Motivation

(c) Supervision

(d) Monitoring and performance evaluation

(e) Training

(f) Development

11. Sales budgeting and reporting.

12. Organizing sales displays.

Roles and Skills of Modern Sales Manager

Some of the important roles of the modern sales manager are:

• A member of the strategic management team

• A member of the corporate team to achieve objectives

• A team leader, working with salespeople

• Managing multiple sales / marketing channels

• Using latest technologies (like CRM) to build superior buyer-seller relationships

• Continually updating information on changes in marketing environment

Personal Selling Skills

1. People Skills – People skill include the personal skills which helps to achieve the
organizational goals and objectives. Some of the people skills include:
• Ability to motivate

• Ability to lead

• Communicate and coordinate effectively

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 2. Managing Skills- Managing skills is the skills of the persons to manage the work
performance effectively. Some of the managing skills involves:
• Administrative skills like planning
• Organizing
• controlling &
• decision making
3. Technical Skills – Technical skills involves;

• Training
• Selling skills
• negotiating skills
• use of IT
• problem solving abilities
• Product knowledge
•
Qualifying for success in selling jobs

What qualities should sales executives possess? It is difficult to list _’success” qualifications.

1. Ability to define the position’s exact functions and duties in relation to the goals the
company should expect to attain: Sales executives calculate what is en-tailed in their
responsibilities. Whether or not the company provides them with a job description, they
draw up their own descriptions consis-tent with the responsibilities assigned by higher
management. Revisions are necessary whenever changes occur in the assigned
responsibilities or in company goals.

2. Ability to select and train capable subordinates and willingness to delegate

sufficient authority to enable them to carry out assigned tasks with minimum
supervision: Ability to delegate authority is a must. Effective executives select high-
caliber subordinates and provide them with authority to make decisions. Within existing
policy limits, decisions are made by subordinates; when an exception falling outside
these limits occurs, the superior decides. The more capable the subordinates, the wider
policy limits can be and the more the superior’s time is freed for planning.
3. Ability to utilize time efficiently: The time of sales executives is valuable, and they
budget it and use it carefully. They allocate working time to tasks yielding the greatest
return. They arrive at an optimum division between office work and field supervision.
4. Ability to allocate sufficient time for thinking and planning: Able administrators
make their contributions through thinking and planning. They know how and are willing
to think. They recognize that reviewing past performances is a prerequisite to planning.
They strive to gain new in-sight that will bring problems into better focus. Effective
sales executives shield themselves from routine tasks and interruptions.
5. Ability to exercise skilled leadership. Competent sales executives develop and improve
their skills in dealing with people. Although they rely to a certain extent on an intuitive
grasp of leadership skills, they depend far more on careful study of motivational factors
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 and shrewd analysis of the ever-changing patterns of unsatisfied needs among those with
whom they work. Skilled leadership is important in dealing with subordinates and with
everyone else.

SUCCESS FACTORS FOR PROFESSIONAL SALESPEOPLE (IN SHORT)

A key issue for aspiring and current salespeople and sales managers is an understanding of the
key success factors in selling. A study by Marshall, Goebel and Moncrieff (2003) asked sales
managers to identify the skills and knowledge required to be successful in selling and the ten
success factors are as:

1. Listening skills

2. Follow-up skills

3. Ability to adapt sales style from situation to situation

4. Tenacity – sticking to the task

5. Organizational skills

6. Verbal communication skills

7. Proficiency in interacting with people at all levels within an organization

8. Demonstrated ability to overcome objections

9. Closing skills

10. Personal planning and time management skills

SALES PROMOTION

Sales promotion is one of the five aspects of the promotional mix. (The other 4 parts of the
promotional mix are advertising, personal selling, direct marketing and publicity/public
relations.) Media and non-media marketing communication are employed for a pre-
determined, limited time to increase consumer demand, stimulate market demand or improve
product availability. Example include contests, coupons, freebies, loss leaders ( is a pricing
strategy where a product is sold at a price below its market cost),, premiums, prizes, product
samples.

Sales promotions can be directed at either the customer, sales staff or distribution channel
members (such as retailers). Sales promotions targeted at the consumer are called consumer
sales promotions. Sales promotions targeted at retailers and wholesaler called trade sales
promotions. Sales promotion includes several communications activities that attempt to

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provide added value or incentives to consumers, wholesalers, retailers, or other organizational
customers to stimulate immediate sales. These efforts can attempt to stimulate product interest,
trial, or purchase. Examples of devices used in sales promotion include coupons, samples,
premiums, point-of-purchase (POP) displays, contests…

Sales promotion is implemented to attract new customers, to hold present customers, to

counteract competition, and to take advantage of opportunities that are revealed by market
research

Trade Vs Consumer Promotion

Trade promotions are targeted toward retailers while consumer promotions are targeted toward
consumers.

Trade Promotions

Trade promotions are marketing activities executed between manufacturers and retailers. Trade
promotions help companies differentiate a product, increase product visibility, and increase the
product purchase rate. But while there are multiple products on the market, retailers only have a
finite space to display items on their shelves. It is therefore sometimes necessary to encourage
retailers to stock your item instead of your competitor's. To this point, trade promotions
include:

• Trade allowances are incentives used to encourage a retailer to stock a product such as
cash discounts or promotional incentives.

• Dealer loaders are incentives given to a dealer to display a product, such as in-store
displays, premiums.

• Trade contests are used to encourage retailers to sell products, as the retailer who sells
the most wins a prize.

• Point of purchase display (POP) is an end cap or center store display where retailers can
show the products to customers to increase awareness.

• Training programs teach employees or retailers the benefits and uses of a product.

• Push money is an extra commission paid to encourage the stocking and selling of a
product.

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Consumer Promotions

Consumer promotions are marketing activities targeted at the consumer to encourage them to
buy the product. These are often used at the product launch to increase brand awareness, market
acceptance, and sales. Types of consumer promotions can include:

• Price deals are temporary reductions in price, such as 50% off an item.

• Discounts are reductions to a basic price of goods or services.

• Reward programs allow consumers to collect points, miles, or credits for purchases,
which they can later redeem for rewards.

• Coupons have become a standard mechanism for sales promotions.

• Some contests automatically enter the consumer into the event through the purchase of
the product.

• Free samples are when a product is given to the consumer so that he or she may try a
product before committing to a purchase.

• Discounts are sometimes given to customers who buy in large quantities.

• Kids eat free promotions offer a discount on the total dining bill by offering one free
kid's meal with each regular meal purchased.

• Premiums are promotional items that can be received for a small fee when redeeming the
proof of purchase.

SUMMARIZE: The purpose of trade promotions is to help

companies differentiate a product, increase product visibility, and increase the product
purchase rate. The purpose of consumer promotions is to
increase brand awareness and market acceptance. Companies will often use
a combination of trade and consumer promotions when launching a new product.

Personal Motivation

These are promotions to the sales force, but some apply to distributors and retailers. The most
widely used sales force promotion is the sales incentives scheme. Rewards are offered to
participants on an equal basis which are over and above normal sales compensation. They can
be prizes in a competition to individuals or groups who perform best against specific objectives.
The problem is that average or below-average performers may not feel sufficiently motivated to
put in any extra effort if they consider that only top performers are likely to win. Thus,
competitions tend to be used for group or area sales force motivation. When establishing a sales

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force incentive scheme one must consider objectives, timing, scoring methods and
prizes/rewards. Typical objectives of such schemes include:

• Introduction of a new product line;

• Movement of slow-selling items;

• To obtain wider territory coverage;

• Development of new prospects;

• To overcome seasonal sales slumps;

• To obtain display; and

• development of new sales skills.

• The timing of the scheme may depend on the size of the sales force, the immediacy of
action required and the nature of the objectives to be achieved. Scoring or measuring
performance may be based upon value or unit sales. In order to overcome territorial
differences, quotas may be established for individual regions, areas or salespeople.
Points, stamps, vouchers, etc., may be awarded on the achievement of a pre-stated
percentage of quotas or level of sales, and continue to be awarded as higher levels are
achieved. Such tokens may then be exchanged for merchandise, cash, etc., by the
recipient. Sometimes catalogues are supplied giving a range of merchandise for the
salesperson or family to choose from. Vouchers for redemption or exchange in retail
stores can be used as prizes or rewards. During a scheme, additional bonus points may
be awarded for the attainment of more specific short-term objectives such as increased
sales of a particular product, increased numbers of new customers or training and
display objectives. In this way a long-running scheme can be kept active and exciting for
participants. Another form of motivation is the award of recognition in the form of a
trophy or ‘sales-person of the year’ award.

Communication

Personal selling is a part of communication mix. Communication has the most direct influence
on sales because personal selling itself is considered as one element of the communication. The
notion of the integrated communications mix was first put forward by Shultz, Tannenbaum
and Lauterborn in 1992. A concept of marketing communications planning that recognizes the
added value of a comprehensive plan that evaluates the strategic roles of a variety of
communications disciplines and combines them to provide clarity, consistency and maximum
communications impact through the seamless integration of discrete messages. The implication
of the integrated communications mix for selling is that the salesforce must be kept fully

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informed of any new sales promotions, direct marketing and advertising campaigns. Sometimes
promotional campaigns have been counterproductive because sales staff have not been
informed. It is clearly unsatisfactory when customers are the first to tell sales staff about a
special offer that has been made through an advertising campaign of which they are not fully
aware.

Communication objectives

• awareness

• stimulate trial

• positioning of brand in consumers’ minds

• remind and reinforce.

Communication objectives. This spells out what the campaign is hoping to achieve, such as
sales volume and value, number of orders, customer retention and/or acquisition and lead
generation.

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