SALES RESPONSIBILITY AND PREPARATION
The primary responsibility of a salesperson is to conclude a sale successfully. This task will involve the identification of customer needs, presentation and demonstration, negotiation, handling objections and closing the sale. These skills will be discussed later in details. In order to generate sales successfully, a number of secondary functions are also carried out by most salespeople. Although termed secondary, they are vital to long-term sales success. These are:
- Database and knowledge management;
- Handling complaints;
- Providing service; and
- Relationship management.
Salespeople are also responsible for implementing sales and marketing strategies. This issue will be considered later.
Prospecting is the searching for and calling upon customers who, hitherto, have not purchased from the company. This activity is not of uniform importance across all branches of selling. It is obviously far more important in industrial selling than retail selling; for example, a salesperson of office equipment may call upon many new potential customers, whereas a furniture salesperson is unlikely to search out new prospects – they come to the shop as a result of advertising and, perhaps, high street location.
Existing customers. This is a highly effective method of generating prospects and yet tends to be under-used by many. A wealth of new prospects can be obtained simply by asking satisfied customers if they know of anyone who may have a need for the kinds of products or services being sold. This technique has been used successfully in life insurance and industrial selling, but also has applications in many other areas.
Having obtained the names of potential customers, the salesperson, if appropriate, can ask the customer if they may use the customer’s name as a reference. The use of reference selling in industrial marketing can be highly successful since it reduces the perceived risk for a potential buyer.
Trade directories. A reliable trade directory such as Kompass or Dun and Bradstreet can prove useful in identifying potential industrial buyers. The Kompass directory, for example, is organised by industry and location and provides such potentially useful information as:
- Name, address and telephone number of companies;
- Names of board members;
- Size of firm, by turnover and number of employees;
- Type of products manufactured or distributed.
Enquiries. Enquiries may arise as a natural consequence of conducting business. Satisfied customers may, by word-of-mouth create enquiries from ‘warm’ prospects. Many companies stimulate enquiries, however, by advertising (many industrial advertisements use coupon return to stimulate leads), direct mail and exhibitions. This source of prospects is an important one and the salesperson should respond promptly. The enquirer may have an urgent need seeking a solution and may turn to the competition if faced with a delay. Even if the customer’s problem is not so urgent, slow response may foster unfavorable attitudes towards the salesperson and their company’s products.
The next priority is to screen out those enquiries that are unlikely to result in a sale. A telephone call has the advantage of giving a personalized response and yet is relatively inexpensive and not time consuming. It can be used to check how serious the enquiry is and to arrange a personal visit should the enquiry prove to have potential. This process of checking leads to establish their potential is known as qualifying. For potential business customers the internet can be useful in qualifying customers. For example, online financial ratings services can be used to check on the prospect’s financial resources. Salespeople may also inspect the prospect’s corporate website and blogs.
The press and the internet. Advertisements and articles can provide clues to potential new sources of business. Articles may reveal diversification plans that may mean a company suddenly becomes a potential customer. Advertisements for personnel may reveal plans for expansion, again suggesting potential new business.
The internet is also a vast resource for identifying new potential customers. For example, salespeople may use electronic versions of product directories (e.g.Thomson Register) to identify companies that carry out certain types of operations and therefore may need specific products or services. Also, online databases (e.g. ABI Inform) can be used to gather detailed data on industries together with information on trends for products and industries.
5. Cold canvassing/cold calling. These terms are used interchangeably and as the words suggest involve calling on potential new customers ‘cold’ i.e. without prior contact or even an appointment. Although widely used in some forms of selling, such as ‘door-to-door’ or telephone selling, it can be an ineffective and thus frustrating approach to generating sales. In fact, only a relatively small number of individuals are able to cope with the stresses, strains and challenges of cold canvassing, making them very special and valuable types of salespeople. Indeed, the process of cold canvassing can be so stressful that someone once suggested that it was ‘God’s punishment’ for the salesperson.
So why is cold canvassing potentially so ineffective and stressful, and, come to that, is it always so?
The major problem in cold canvassing lies with the potential reaction, or perhaps lack of it, on the part of the customer.Cold canvassing means approaching customers who at the extreme have never heard of the company, have never heard of its products, have never met or spoken to the salesperson before and may have no conceivable interest in, or need for, the product or service in question. Imagine the difficulties of trying to sell in this situation.
Furthermore, the customer may strongly resent being approached without prior warning or permission. This is particularly the case where customers are approached in their own time and/or in their own homes as is the case with much consumer product cold canvassing.
In fact, there are major potential ethical and regulatory issues associated with some types of cold calling, especially where the approach to the potential customer is made via the internet or by telephone. Consequently, any marketer intending to use these contact methods for cold calling must be familiar with, and careful to adhere to, any legal or industry regulations and guidelines pertaining to the cold calling process.
Resentment and possible anger on the part of the customer at being cold called obviously make it much more difficult for the sales person to initiate the selling process, never mind make a sale. In addition, the lack of pre-qualification on the part of the seller with regard to the customer’s needs, wants and circumstances often means that, even if the customer does not resent being approached in this way, they may simply have no need of the product or service under any circumstances.
But if cold calling is potentially so ineffective and stressful, why do many companies continue to practise it? Is there anything to recommend it? The answer is, quite simply, yes!
Cold calling allows a company the potential to expand its customer base. If companies restricted their sales efforts to existing customers, they would find it much more difficult to grow. In addition, cold calling evidences a proactive approach by a company towards its markets. Some argue that the marketer should wait for the customer to come to the company before trying to sell to them, on the basis that if somebody wants something they will ask. However, we all know that this is not always the case – customers often want marketers to present them with solutions to their purchasing problems. Finally, for at least some salespeople cold calling represents the challenge they need to keep them motivated. Especially where they are suitably rewarded for success.
All in all, it would be a mistake to rule out cold calling as a way generating new sales. However, cold calling activity does need to be carefully planned and managed. Some of the ways in which cold calling can be made more effective include the following:
- Try to make cold calling as unintrusive as possible for the customer. For example,do not cold call at what are known to be busy or inconvenient times for the customer.
- Related to the above, in the case of domestic customers try to avoid cold calling very early or very late in the day.
- At all times respect the privacy of the customer and always respect their wish not to be bothered.
- Do not ever try to bully a customer into speaking to or seeing you.
- Use cold calling to secure a future appointment, or to gain an agreement to send further information, rather than immediately trying to secure an order.
- Find out as much as possible about the prospective customer and use this to plan the cold call approach and content. In particular, the effectiveness of cold canvassing can be improved where information is used to identify customers who are more likely to buy because of some attribute or characteristic that can be identified in advance. For example, we might select only companies over a certain size, or perhaps consumers in a certain income bracket or lifestyle group.
Endless chain method/family tree method. Works on the principle of multiplication.
Centre of influence method-the selected persons are either customers, influential friends of customers e.g. ministers, MPS, MCAS, doctors, lawyers, bankers, professors, club officials, business leaders, social workers and community leaders.
- Personal observation method-what happens on the ground.
- Spotters method-Junior sales men are employed, many at a time to locate the prospects, in a particular territory of a specific social status.
- Direct mail and telephone method.
- Exhibitions and demonstration-Takes place from time to time at city, regional, national or international level.
- Bird-dog method-Closely related to spotters method.A nick name given to those persons who visit the houses at a definite interval e.g.
- Electric /water meter readers.
- Gas boys.
- Milk suppliers
- Newspaper boys
Database and knowledge management
Databases and customer knowledge are not just essential for prospecting. A systematic approach to customer record-keeping is also to be recommended to all repeat call salespeople. An industrial salesperson should record the following information:
- Name and address of company;
- Name and position of contact(s);
- Nature of business;
- Date and time of interview;
- Assessment of potential;
- Buyer needs, problems and buying habits;
- Past sales with dates;
- Problems/opportunities encountered; and
- Future actions on the part of salesperson (and buyer).
This aspect of the sales job is of particular importance, since a salesperson often works alone with the minimum of personal supervision. A salesperson may have to organise their own call plan, which involves dividing territory into sections to be covered day by day and deciding the best route to follow between calls. Often it makes sense to divide a territory into segments radiating outwards, which the salesperson’s home at the centre. Each segment is designed to be small enough to be covered by the salesperson during one day’s work.
Many salespeople believe that the most efficient routing plan involves driving out to the furthest customer and then zigzagging back to home base. However, it can be shown that adopting a round-trip approach will usually result in lower mileage.
Such considerations are important with respect to efficiency, as an alarming amount of time can be spent on the road as opposed to face-to-face with buyers. A survey conducted on behalf of the Chartered Institute of Marketing into UK selling practice found that, on average, only 20–30 per cent of a salesperson’s normal working day is spent face-to-face with customers. Although this study was conducted almost 30 years ago, matters have not improved since.
Handling complaints may seem at first to be a time-consuming activity that diverts a salesperson from the primary task of generating sales. A marketing orientation for a salesforce, however, dictates that the goal of an organisation is to create customer satisfaction in order to generate profit. When dissatisfaction identifies itself in the form of a complaint, this necessary condition for long-term survival is clearly not being met.
Complaints vary in their degree of seriousness and in the authority that the salesperson holds in order to deal with them. No matter how trivial the complaint may seem, the complainant should be treated with respect and the matter dealt with seriously.
Salespeople are in an excellent position to provide a ‘consultancy’ service to their customers. Since they meet many customers each year, they become familiar with solutions to common problems. Thus an industrial salesperson may be able to advise customers on improving productivity or cutting costs. Indeed, the service element of industrial selling is often incorporated into the selling process itself, e.g. computer salespeople may offer to conduct an analysis of customer requirements and produce a written report in order to complete a sale. The salesperson who learns solutions to common problems and provides useful advice to their customers builds an effective barrier to competitive attacks and strengthens buyer–seller relationships.
- Relationship management.
Another key responsibility for salespeople is relationship management.. This coverage examines relationships between salespeople and customers. There is, however, another set of relationships that a salesperson must master in today’s complex selling environment: those between the salesperson and other people in their company who are vital to ensure a smooth sales process and efficient delivery and service of the product. Particularly with key accounts, selling is performed by a team of players (e.g. from engineering, production, marketing, finance and senior management). Key account managers must be able to manage these relationships both within their firms and between those players and members of the customer’s DMU.
- Implementing sales and marketing strategies.
- Sales and profit success-Will be discussed later.
The sales force is also charged with the responsibility of implementing sales and marketing strategies designed by management. Misunderstandings regarding strategy can have grave implications.
The ability to think on one’s feet is of great benefit to salespeople, since they will be required to modify their sales presentation to suit the particular needs and problems of their various customers and to respond quickly to unusual objections and awkward questions. However, there is much to be gained by careful preparation of the selling task. Some customers will have similar problems; some questions and objections will be raised repeatedly. A salesperson can therefore usefully spend time considering how best to respond to these recurring situations.
In many selling situations, buyers and sellers may negotiate price, timing of delivery, product extras, payment and credit terms, and trade-in values. These will be termed sales negotiations.