Chapter 9
Personal Selling, Relationship
Building, and Sales Management
Key Terms
Information Provision, Persuasion, After-sale Service,
Prospecting, Random Lead Generation, Lead, Selected-lead
Searching, Planning the Sales Call, Presenting, Responding to
Objections, Obtaining Commitment, Long-term Relationship,
Functional Relationships, Strategic Alliances, Missionary
Salespeople, Technical Sales Specialist, Cross-functional Sales
Team, Sales Force Organization, Forecasting Sales, Sales
Territories and Quotas, Salary, Commission
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Personal Selling – Definition
 Defined as a two-way flow of communication
between a potential buyer and a salesperson
 Use of personal selling depends partially on the
nature of product
 Key role played by salesperson in providing
information about product
 Use personal selling when products are
 New and different
 Technically complex
 Expensive and require negotiation
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Sales Process
 Refers to two basic factors
 The objectives the salesperson is trying to achieve
while engaged in selling activities
 The sequence of stages or steps the salesperson
should follow to achieve the objectives (relationshipbuilding process)
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Sales Force Objectives
 Information provision
 Persuasion
 After-sale service
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The Sales Relationship-Building
Process
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The Evolution of Personal Selling
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Prospecting – Locating Potential
Customers
 Lead – A candidate to whom a sale can be made –
target of prospecting process
 Random lead generation – Mass appeals that require
a high number of contacts to generate qualified leads
 Selected-lead searching – Uses existing contact to
generate new ones – often called referrals
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Prospecting – A Screening Process
 Does the lead have a want or need that can be
satisfied by the purchase of the firm’s products or
services?
 Does the lead have the ability to pay?
 Does the lead have the authority to pay?
 Can the lead be approached favorably?
 Is the lead eligible to buy?
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Common Sources of Sales Leads
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Planning the Sales Call
 Thorough knowledge of representative company,
including past history
 Thorough knowledge of products and product lines
 Good working knowledge of competitor’s products and
product line
 In-depth knowledge of the market for their merchandise
 Accurate knowledge of buyer, or prospect
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Presenting
 Be well prepared and set a goal for your presentation
 Develop a checklist of items for discussion
 Development of good interpersonal skills
 Adapt your style to the prospect
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Overcoming Objections
 Expect objections to occur at any time
 During efforts to secure appointments
 During the presentation and subsequent relationship
 During attempts to obtain a commitment
 During the after-sale follow-up
 In response to an objection, a sales person should not
challenge the customer
 Make the necessary presentation in order to help the
client make an intelligent decision
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Obtaining Commitment
 Important to know how and when to close a sale
 Not all sales end in a successful closing –
Salespeople should analyze the reasons and
determine whether
 More sales calls are necessary to obtain commitment
 Currently, there just does not exist a good match
between customer needs and seller offerings
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Building Long-Term Relationships
 After-marketing activities include
 Establishing and maintaining a customer information file
 Monitoring order processing
 Ensuring initial proper use of product or service
 Providing customers ongoing guidance and support
 Analyzing customer feedback and responding quickly to
questions and complaints
 Continually conducting customer satisfaction research
and responding to it
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Relationships Can Lead to
Partnerships
 Functional relationships – When a buyer and a
salesperson has a problem, they work together to
solve it
 Strategic relationships (strategic alliances) – Longterm, formal relationships in which both parties make
significant commitments and investments in each
other in order to pursue mutual goals and to improve
the profitability of each other
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People Who Support the Sales Force
 Missionary salespeople – Focus solely on promoting
existing products and introduction of new products
(e.g.: pharmaceuticals)
 Technical sales specialists – Support the sales staff
by providing training or other technical assistance
 Cross-functional sales team – Increased in popularity
since products increase in technical complexity, and
units of the buying organization require specialized
knowledge
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Why Cross-Functional Sales Teams
Are Growing in Popularity
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Managing the Sales and RelationshipBuilding Process
 Efficient and effective sales tools, continuous sales
training, and adequate support from promotional tools
 Efficient delivery and reorder system
 Equitable compensation plan to reward and motivate
performance, and promote company loyalty
 Adequate supervision and evaluation of performance
for continual improvement
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Organizing the Sales Force
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Sales Management Task – Sales
Force Organization
 Geographic structure – Provides practical benefit of
limiting the distance each salesperson must travel
 Product structure – Useful when sales force must
have specific technical knowledge about products
 Customer structure – Works best when different types
of buyers have large or significantly different needs
 Major account management – Use of team selling to
focus on major customers to establish long-term
relationships
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Forecasting Sales
 Estimate of how much of the company’s output, either
in dollars or in units, can be sold during a specified
future period under a proposed marketing plan and
under an assumed set of economic conditions
 Used to
 Establish sales quotas
 Plan the personal selling efforts and other types of
promotional activities
 Budget selling expenses
 Plan and coordinate production, logistics, inventories,
personnel, and so forth
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Forecasting Methods
 Jury of executive opinion method – Combines and
averages views of top management from different
departments
 Sales force composite method – Sales force becomes
the jury
 Customer expectations method – Asks customer
about the quantity they expect to purchase
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Forecasting Methods
 Time-series analysis – Analyzes past sales data and
the impact of factors influencing sales
 Correlation analysis – Measures relationship between
dependent and independent variables
 Other quantitative techniques – Growth functions and
simulation models
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Sales Territories and Quotas
 Sales territories can be segmented on the bases of
 Geography
 Product specialization
 Sales quotas
 Provide incentives for salespeople
 Provide a quantitative standard for performance
measurement
 Evaluate and control the efforts of the sales force
 Activity quotas – Allows monitoring of whether
salespersons are engaging in activities to the extent
desired
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Sales Territories and Quotas
 Sales quotas represent specific sales goals assigned
to each territory or unit over designated time period
 Management needs to consider these key factors
 All territories will not have equal potential and, hence,
compensation must be adjusted
 All salespeople will not have equal ability and
assignments may have to be made accordingly
 Sales task in each territory may differ from time period
to time period
 Analyzing expenses – Sales forecasts should include
a sales expense budget
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Effort- and Results-Oriented Measures
for Evaluating Salespeople
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Medi-test Company Sales Activity
Evaluation
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Motivating and Compensating
Performance
 Salary – Refers to a specific amount of monetary
compensation at an agreed rate for definite time
periods
 Commission – Is monetary compensation provided for
each unit of sales and expressed as a percentage of
sales
 May be computed on the bases of
 Volume of sales in units of product
 Gross sales in dollars
 Net sales after returns
 Sales volume in excess of a quota
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Types of Incentives and Their
Possible Performance Outcomes
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