Kotler Summary – Chapter 22: Managing the Sales Force

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Chapter notes for the famous marketing textbook by Kotler
Subject: Marketing

Sales Force Components

Sales Force Objectives
A Sales Force will have one or more of the following tasks.

  • Prospecting – search for leads
  • Targeting – allocation of time between prospects and customers
  • Communicating – info about company and products
  • Selling – Approach, presentation, answering objections, closing sales
  • Servicing – consulting, technical, financing, etc.
  • Info gathering – market research
  • Allocating – scarce products to customers.

Sales Force Strategy
Ways sales reps work with customers to maintain company competitive edge:

  • Rep to buyer – discuss issues with a prospect or customer
  • Rep to buyer group – rep gets to know as many members of buyer group as possible
  • Sales team to buyer group –
  • Conference selling – company sales rep and resource group to customer to talk big problems or opportunities
  • Selling Seminar – Company team to group of buyers/customers
  • Once company has strategy can go with direct sales force or contractual force. Direct sales force is standard sales force with office and field reps, while contractual reps are purely commission sales forces.

Sales Force Structure

  • Territorial – each rep gets own piece of land to work equally divided by workload or potential – result is no customer confusion as to who the rep is
  • Product – generates specific product knowledge
  • Market – industry or customer type delineation
  • Complex – combination

Sales Force Size
Depends upon the # of customers you want to reach then:

  • Group customers into classes by annual sales volume
  • Establish desired call frequency
  • Classes size time freq. = workload
  • Determine # of calls a rep can make a year
  • Workload divided by rep calls per year = number of reps needed

Sales Force Compensation

  • Salary. Straight salary provide reps secure income, reps more willing to do non selling activities, reps have less incentive to overstock customers, lower company administrative activities and lowers turnover.
  • Commissions. Straight commission attracts higher sales performers, provides more motivation and requires less supervision, while controlling selling costs.
  • Benefits
  • Expense allowance

Managing the Sales Force

Recruiting and Selecting Reps

  1. Determine what you want your sales people to be like
  2. Recruitment
  3. Select the best applicants
  4. Train the new reps – vital to protect company image as well as get orders – Program should have the goals of having reps:
    • know and identify with the company – what has the company done
    • know the company’s products
    • know the customers, and competition characteristics
    • know how to make an effective presentation
    • understand field procedures and responsibilities – dividing time between active accounts and prospecting etc.

Supervising the Sales Force

  • Develop norms for customer calls – and how much sales volume should be generated per call
  • Develop Norms for prospect calling – needed to motivate reps to look for new business
  • Ensuring efficient use of time and assets – direct supervision or training

Motivating Sales Reps – often not too difficult as sellers are usually self motivated. Supervisors must work through expectancy theory: 1) Hard work will get sales -2) Sales will get you a reward, and 3) you will like the reward. All three are linked.

Sales Quotas – three schools: High quotas to spur effort, Modest – to achieve buy-in, Variable – to account for differences between sales people.

Supplemental Motivators – sales meetings and contests provide social occasion to meet, share ideas and accomplishments, or get extra effort from the force.

Evaluating Sales Reps

Sources of information

  • Sales reports – give activity plan and activity results
  • Call reports – give activities of reps and status of various accounts and prospects
  • Other reports like expense account info, new bus reports, lost bus report economic conditions.

Formal evaluation

  • Current to past Sales performance – did you sell more or less, and of what product.
  • Customer Satisfaction reports –
  • Qualitative evaluations – reps knowledge of company or products, personality characteristics of reps, knowledge of the laws that pertain to the rep.

Principals of Personal Selling

  • Prospecting and Qualifying – the art of finding good leads – cold calls to asking current customer for names to joining professional organizations
  • Pre-approach – learn about the prospects business and decided the best approach to take
  • Approach – know how to get off to a good start/get a foot in the door
  • Presentation
    • get the customers interest, show benefits and features
    • use canned approach
    • formulated approach – uses buyers needs and desires to pull out the right formula to use in the presentation
    • need satisfaction approach – listen and then use problem solving skills to fix customers problems
  • Overcoming Objections – either psychological or logical – sales rep must handle any type. Logical are the easiest if the product can handle the issue. Both types may require negotiation skills.
  • Closing – ask for the sale
  • Follow up and Maintenance – ensures you will be allowed back into the customers office. Builds both rep and company reputations

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2 Comments

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