Course Instructor:

Dr. Sushant
 Learning Objectives : Slide 3 –
15
LO1 : Understand evolution and definition of sales
management.
LO2 : Explain the nature and importance of sales
management.
LO3 : Describe the levels of sales management
positions.
LO4 : Discuss the nature of personal selling.
LO5 : Construct various aspects of strategic sales
management and sales planning.
LO6 : Identify emerging trends in sales management.
Evolution of Sales Management
• Situation before industrial revolution in U.K. (1760
AD).
• Situations after industrial revolutions in U.K., and
U.S.A.
• Marketing function splits into sales and other
functions like marketing research, advertising,
physical distribution, and customer service.
 What is Sales Management?

• One definition: The management of the personal selling part of a

company’s marketing function.

• Another definition: The process of planning, directing, and

controlling of personal selling, including recruiting, selecting,
equipping, assigning, supervising, paying, and motivating the personal
sales force.
 Nature of Sales Management

It includes :
(1) Its integration with marketing management.
(2) Scope of sales management.
(3) Roles and skills of a modern sales management.

Its Integration with Marketing Management

Head-
Marketing

Manager- Manager – Manager – Manager – Manager –

Promotion Marketing Sales Market Customer
Research Logistics Service
 Roles and Skills of a Modern Sales Manager
Some of the important roles / functions of a modern sales manager are:

• Senior level sales manager is a member of the strategic management

team.

• Coordinate internally and externally.

• First level sales manager is a team leader, working with and managing
salespeople.

• Managing multiple sales / marketing channels.

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

relationships.
Skills of a Successful Sales Manager

• People skills include abilities to motivate, lead, communicate, coordinate,

develop team-oriented relationships, mentor, and resolve conflicts.
• Managing skills consist of planning, organizing, controlling and decision
making.
• Technical skills include training, selling, negotiating, problem-solving,
and use of computers.

Note: People Management and Problem Management (Managing Skills

and Technical Skills)
Importance of Sales Management

• The only function / department in a company that

generates revenue / income.
• The financial results of a firm largely depend on the
performance of the sales management
• Many salespeople are among the best paid people in
business.
• It is one of the fastest and surest routes to the top
management through many positions.
• Fresh graduates need knowledge of sales
management.
Levels of Sales Management Positions

CEO /
President
V. P. Sales /
V. P. Top-Level Sales
Marketing Managers / Leaders
National Sales
Manager

Regional / Zonal / Divisional Middle-Level Sales Managers

Sales Managers

First-Level Sales Managers

District / Branch / Area Sales Managers

Sales Trainee / Sales Person / Sales

Representative
 Nature of Personal Selling.

It Includes:

(i) Transactional and relationship selling.

(ii) Varying sales positions.
(iii) Sales as a career.

Transactional and Relationship Selling

* Transactional selling focuses on getting
an order or closing the sale.
* Relationship selling builds long-term
relationships with key customers.
 Varying Sales Responsibilities / Positions / Jobs
Sales Position Brief Description Examples
• Delivery salesperson • Delivery of products to business • Milk, newspapers to households
customers or households.
• Also takes orders. • Soft drinks, bread to retail stores.
• Order taker salesperson. • Inside order taker. • Behind a counter in a garment shop
•Telemarketing salesperson takes • Pharmaceutical products’ orders from
orders over telephone. nursing homes.
• Outside order taker. Also performs • Food, clothing products’ orders,
other tasks. market information from retailers.

• Sales support salespeople • Provide information, build goodwill, • Medical reps. in pharmaceutical
• Missionary selling introduce new products industry.
• Technical selling • Technical information, assistance • Steel, Chemical industries

• Creative, Problem-solving, • Getting orders from existing and new • Automobiles, refrigerators, insurance
Consultative sellers. household consumers policies
• Getting orders from business • Software and business solutions.
customers, by solving their business
and technology problems

•Key account sales executive •Responsible for few important •OEM customer like Tata Motors for a
customers. tyre manufacturer.
 Sales as a Career

• There are various sales positions – as seen in slide no.11

• There are several levels of sales management positions - as seen in slide

no.9

• Companies develop attractive compensation plans for salespeople.

• Exciting and challenging sales career- as it deals with people whose

needs/wants are ever- changing.

• Fastest route to the top management positions through sales

management.
 Sales Planning Includes
Sales Objectives, Strategies and Tactics

The main components of planning in a company are objectives, strategies

and tactics. Their relationship is shown below

Decide / Set Evolve Tactics /

Develop Strategies Action Plans
Objectives

E.G. A company wants to increase sales of electric motors by 15

percent, as one of the sales objectives. (see the next slide)
 Illustrating the Relationship Between Sales Objectives,
Strategies and Tactics in Sales Planning

Sales Goals / Marketing Sales and Distribution Tactics /

Objectives Strategy Strategies Action plans

 Increase  Enter  Identify the countries  Marketing / sales head to

sales export get relevant information
volume by markets  Decide distribution channels  Negotiate and sign
15 percent agreements in 3-5 months
with intermediaries

 Penetrate  Review and improve sales  Add channels and channel

existing force training, motivation partners.
domestic and compensation  Train salespeople in
markets  Use effective and efficient deficient areas.
channels.  Train field sales managers
in effective supervision.
 Link sales volume quotas
to the incentive scheme of
the compensation plan.
 Emerging Trends in Sales
Management
• Global perspective.
• Revolution in technology.
• Customer relationship management (CRM) / Sales Force
Automation ( SFA )
• Sales force diversity.
• Team selling approach.
• Managing multi-channels marketing systems.
• Ethical and social issues.
• Sales professionalism.
• E-Selling.
LEARNING OBJECTIVES: Slide15 - 32
• LO1 : Recognize the steps of the selling process.
• LO2 : Know the need and methods of prospecting and qualifying.
• LO3 : Explain pre-approach tasks, approach techniques and the buyer’s needs.
• LO4 : Understand methods of sales presentation, product demonstration and
handling objections.
• LO5 : Determine the techniques of trial close and closing the sale, and follow-
up tasks.
• LO6: Apply the success factors in selling.
 Evolving Paradigms of Sales
• Team Selling:
• Expensive, High sales and profit potential, Complex selling situations, Customises
products and services, Long term contacts, New Customers (Focus: Whole Company )

• Key Account Management:

• Understanding of customer business and needs, adopting relationship selling approach,
and using team selling method to deliver a solution that matches the need/painpoint of the
buyer
Ex: Steel Tubes

• Consultative Selling: Prob. Solving

• In-depth Knowledge, Proposal of selling (Presentation), Cross functional expertise, long
 The Selling Process

If salespeople follow the steps shown below, their chances of

success are far better.

1. Prospecting & 4.Discovering &

2.Pre-approach 3.Approach
Qualifying Understanding

7.Closing the 6.Handling 5.Sales Presentation

8. Follow-up Sale & Demonstration
Objections

• The sequence of above steps may change to meet the sales

situation in hand.
• All kinds of selling do not necessarily pass through the eight
steps of the selling process shown above.
 Prospecting
Prospecting is identifying prospective or potential customers for the company’s
products/services.
• Methods for identifying sales leads or leads (i.e. names and addresses of prospects)
are:
• (1) consulting existing customers 2/3 TSL, (2) The company sources (website, ads.,
tradeshows, phones), (3) external sources (suppliers, intermediaries, trade associations),
(4) salespersons’ networking, (5) publications like industrial directories, (6) cold
canvassing, (7) standard industrial classification (SIC) system. (8) World Wide Web’s
(WWW’s) search engines.

Qualifying
Companies qualify sales leads to prospects by contacting them by e-mails or on phone to
find their (i) interests (or needs), (ii) financial capacity, and
(iii) ability to make a decision.

After qualifying, the sales leads are categorized as: Hot, Warm, or Cold prospects
Process of Prospecting and Qualifying

Start with leads/probable prospects - Suspects

(using methods for identifying sales leads).
From leads to qualified prospects (using
need, decision making, affordability criteria).
Identify hot prospects ( criteria :
sound finance, likely to buy).

Convert hot prospects to

customers (purchased the
company’s products / services).

Sales Funnel
Successful salespeople always keep the sales funnel full.
 Pre–Approach
Before approaching a prospect , a salesperson performs two tasks (1) information
gathering ,(2) planning the sales call (Adaptive Selling)

Information Gathering
• Salespeople collect the prospective customers’ information like location, type of
business, purchase orientation and practices, & so on.
• Sources of information include the Internet, trade magazines, industrial directories,
online information services, etc

Planning the Sales Call

• Whom to see? Decision Maker or Buyer or Influencer
• Where to go? Address, Mob. No and Right Maps

• What are the call objectives? Information of Needs and Decision Makers
• How to approach the prospect? Adaptive Selling
 Approach (Breaking the Ice)
• Make an appointment to meet the prospect.
• Make a favorable first impression.

Which of the following ‘approach techniques’ to be

used?
• Introductory.
• Customer benefit statement.
• Product.
The purpose of approach is to gain the prospect’s agreement to move
forward to the next step.
 Discovering & Understanding Buyers’ Needs
(Pain Points)
• Customers buy products/ services to satisfy their needs or to solve their
problems.
• Salespeople uncover & know buyers’ needs by asking questions.
• Research based ‘SPIN Model’ suggests four types of questions :
(1) Situational questions –to know buyer’s current situation – Avoid
Factual and Sensitive Questions/information/conflicts
(2) Problem questions-to discover problems or dissatisfaction experienced
by the buyer. (Be cautious on buyer recent purchases, personal or emotional
involvement)–Sol.Why? Why? Symptoms & Problems Iceberg P
(3) Implication questions-to find implications or consequences of not
solving the problem.
(4) Need-payoff questions- to know the value or importance of the solution
to the problem. The purpose is to develop the buyer’s desire for a solution.
Solution_Value questions
Sales Presentation Methods
•The Objective of sales presentation is to persuade the customer that the
company’s product/service being sold will meet his / her needs better than
that of competitors.

• Salespeople can choose from the following sales presentation methods:

(1) Stimulus Response Method/Canned Approach

• It is a memorized sales talk or a prepared sales presentation.
• The salesperson talks without knowing the prospect’s needs
• This method is used by telemarketing people, door-to-door
salespersons, and for training new salespeople with some changes.
.
 (2) Formula Method / Formulated Approach.
• This method is also based on stimulus response thinking.
Salesperson assumes that buyers can be led through mental steps by
using a well-known formula – AIDA (attention, interest, desire,
and action). However, the AIDA model is now changed, as seen
below :

From To

A. Attention Rapport
I. Interest Need
D. Desire Solution
A. Action Close
 Sales Presentation Methods (Continued)
( 3 ) Need – Satisfaction Method
• It is an interactive sales presentation, a creative form of selling.
• Salesperson first uncovers prospect’s needs by asking questions and listening. He
then makes a sales presentation by using FAB approach: Features, Advantages,
Benefits.
• It is an effective method, as it focuses on customers.

(4) Consultative Selling Method/Problem-Solving Approach

• Used as a professional selling process in the 21st century.
• Salespeople use cross-functional expertise.
• Firms adopt team selling approach.
• Sales team-work in a collaborative/partnering relationship with the buying firm.
• Used by software / consulting firms.
 Demonstrating the Product

• Sales presentation can be improved by demonstration.

• Demonstration is one of the important selling tools. Examples
: Test drive of cars; demonstrations of industrial products in
use at trade shows.

• Benefits of using demonstration for selling are:

• Buyers’ objections are cleared.
• Improves the buyer’s purchasing interest.
• Good Support in the selling process.
• Helps to find specific benefits needed by the prospect.
• The prospect can experience the benefits.
 Handling Objections

• Objections from prospective customers may take place during

presentations / when the order is asked. If objections are handled
satisfactorily, they may result in sales.
• Two types of sales objections happen :
• Psychological / hidden objections
• Logical, real or practical objections

• Methods used for handling objections:

(i) For Psychological objections: ask questions to clarify the
customer’s thinking.
(ii) For logical objections: (a) ask questions, (b) turn an objection
into a benefit, (c) deny objections tactfully, (d) show third-party
certificates, (e) offer compensation.
• Note: Objections are discussion points not rejections
 Handling Objections
• Two types of sales objections happen :
• Price Related objections
• Product Related objections

• Methods used for handling objections:

(i) For Price Related objections
• Low Priced Model (Low-Sell)
• Price-Value of Alternative Products
• Break Down the Yearly Price (Term Plans)

(ii) For Product Related objections

• Demonstration
• Testimonials, Expert Opinion, Case Histories
• Trial Use (Software – Freemium)
 Trial Close and Closing the
Sale
• ‘ Trial close ‘ checks the attitude or opinion of the prospect
(not decision), before closing the sale.
• If the response to trial close question is favorable, then the
salesperson should close the sale ( i.e. ask for the order ). If not,
go back to presentation.
• Some of the major closing techniques are:
(a) alternative-choice, (b) minor points, (c) assumptive,
(d) summary-of-benefits (FAB approach, SELL seq.) (e)
T-account, (f) special-offer, (g) probability, and (h)
negotiation

SELL: Show Feature, Explain Adv, Lead Into Benefit, Let

Customer Talk.
 Follow-Up
Necessary for customer satisfaction and building loyalty.
• Successful salespeople follow-up in different ways:

• Check customer order.

• Visit when the product is delivered.
• Carry out account penetration.
• Build long-term relationship.

• Post Purchase Anxiety – Cognitive Dissonance

Note: Don’t Hesitate to Ask for Referrals.
 Negotiation Skills

Salespeople need negotiating skills:

Negotiations are needed under the following circumstances :
(a) When the buyer puts certain conditions for buying to the seller,
(b) When agreement between the buyer and the seller is needed on
several factors, (c) When the product is customized, and (d) When
the final price is to be decided.

Steps needed to prepare for negotiation with customers:

(a) planning, (b) building relationship, and (c) knowing the purpose.

Styles of Negotiation
(a) I win, you lose, (b) Both of us win (or win-win style), (c) You win,
I lose, and (d) Both of us lose (lose-lose style)
 Learning Objectives: Slide 34 - 60

LO1. Know the purposes of a sales organization and classify the basic types
of sales organizations.

LO2. Explain specialization in sales organizations, categorize key accounts,

and create a sales organization for key accounts.
 Basic Types of Sales Organizations
•Sales organizations are generally classified into

Four basic types:’

(i) Line sales organization.

(ii) Line and staff sales organization.
(iii) Functional sales organization.
(iv) Horizontal sales organization.

Relationship between JOB and PEOPLE

 (i) Line Sales
Organisation
Head
Marketing

Sales
Manager

Area Sales Area Sales

Area Sales Area Sales
Manager-3 Manager-4
Manager-1 Manager-2

salespeople salespeople salespeople salespeople

Characteristics: All managers have line authority to direct and control subordinates. Used
in small firms and in companies having less number of salespeople.
Advantages: Simple organization structure, clear authority, quick decision making, and
low cost.
Disadvantages: No support to line managers from subordinates with specialized
knowledge / skills. The sales manager has Less time for planning / analysis. As the
company grows, line sales managers are overburdened, which makes them ineffective.
 (ii) Line and Staff Organization

Characteristics: Specialist staff managers are made available to the

sales/marketing head. Staff managers’ role is to assist / advise line sales
managers. Used in medium and large size organizations.
Advantages: Better marketing decisions, superior sales performance.
Disadvantages: Higher cost and coordination work, slower decision making,
conflict may arise if staff managers’ role is not clear.
 (iii) Functional
Organisation
Specialization

Characteristics: Each staff functional specialist manager has line authority over salespeople. Used
by a large firm with many products / market segments with minimum number of staff functional
managers.
Advantages: Qualified specialists guide salespeople. Simple to administer.
Disadvantage: Confusion and frustration of salespeople due to more managers giving orders.
Marketing head faces a difficult task of coordinating the competing functional heads.
 (iv) Horizontal
Organization
Operations Team:
Research & Design Team: •Production / Operations
•Customer Research •Quality Assurance
•Product / Service Design •Systems Engineering

Planning Team:
•Strategic Planning
•Accounts, Finance
•HR, Administration
•Chief Operating Officer

Customer Support Team: Customer Satisfaction

•Information Team:
•Service •Sales & Marketing
•Training •Pricing, Promotion
•Channels, Logistics

Characteristics: Removes management levels and departmental boundaries. Except

planning team, all others are members of cross-functional teams. Used by firms having
partnering relationships with key customers.

Advantages: Reduction in supervision, unnecessary tasks, and cost; Improved

 Specialization in Sales
Organization

• Needed to increase effectiveness of the sales force.

• Done by expanding the basic sales organization.

• Bases of Specialization:
(1) Geography
(2) Product
(3) Market
(4) Functional
(5) Combination of the above factors.

• Criteria for Selection – (i) meeting customer needs, (ii) nature

and number of products, (iii) abilities of the sales force, and (iv)
 (1) Geographic Specialisation

Characteristics: Salespeople are assigned geographic areas and are responsible for
all selling activities to all customers within the assigned areas. Branch sales
managers adjust marketing plan to local needs.
Advantages: Better market coverage and customer service, better control over
salespeople, quick response to local conditions and competition.
Disadvantages: Limited specialization of marketing tasks. Hence, it is often
combined with product / market sales organization.
 (2) Product Specialization
• Used when the company has many products and / or brands
• Two types of product specialization:
(x). Sales organization with product specialized sales force.
(y). Sales organization with product managers as staff specialists.

Fig. (x):Sales Organization with Product Specialized Sales Force.

 Product Specialisation (Continued)

Fig. (y): Sales Organization with Product Managers as Staff

Specialists
Fig. (x): Characteristics: Salespeople in each product group sell only the products in that
group.
Advantage: Each product gets specialized attention from the sales force.
Disadvantage: Sometimes, more salespeople from the same company contact the same
customer, resulting in customer dissatisfaction and higher selling cost.
Fig.(y): Characteristics: Each product manager plans and implements marketing plan for a
product group.
Advantage: Corrects the problem of duplication calls on a customer by the company
salespeople.
 (3) Market
Specialization

• Characteristics: Desirable when customers are classified by specific types, user

industry, or marketing channel. Salespeople carry out all activities for all products
only for specific customer groups. Use of market specialization is increasing.

• Advantages: Meets needs of specific customer groups, implements customer-

centered philosophy of the company.

• Disadvantages: Geographic duplication of territory coverage and higher costs.

( For functional specialization, see slide no.7)

 (4) Combination Sales
Organisation

• Characteristics: Many firms use some combination of specialization

organizations, called hybrid or combination sales organization, with a view to
minimize disadvantages and maximize advantages of specialization
organizations.
• The figure above shows combination of geographic and market
specializations.
 Assignment

• Identify 5 organizations using different 5 types of

explained specialization in sales organizations.

• Also list 2 advantages and challenges of each.

Thanks!

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