SETTING PERSONAL SELLING OBJECTIVES

SETTING PERSONAL SELLING OBJECTIVES

Obj set in consultation with Marketing Department

Some Examples of Personal selling objectives:Maintain existing customer base Obtain 20% new customersMotivate Dealers- maintain 1 month stocksKeep existing customers informed of new ProductProvide technical service within 48 Hrs of call.Train Middlemen (dealer) on Customer Care

Case on Personal Selling Objective- Case-1 A credit card company is Planning to set it’s personal selling objectives based on the following feedback it received from the sales department and the DSAs of the company. Average customers are not aware of the complete product benefits of credit cards. The DSA,s do not have skilled and trained Manpower. The conversion % in the assignment base chosen has been just 5%. The industry standard is 15% conversion. The customer base of this company ranks within the last three among the 10 players in this business. Based on the above please prepare personal Selling Objective for this organization

What is Market Potential ?Estimate of maximum possible Sale opportunity in the Market.What is Sales Potential?•The possible sales which can be achieved out of Market PotentialWhat is Sales Forecast?Estimate of Sales in terms of units or value in given period of time

The above all is based on a given Marketing plan and inputs

Market Motivation

Before fixing the forecast answer the following

•Why do people buy?•Why people do not buy?•How best to present product (the sales pitch)•Relative effectiveness of different selling appeals•Relative appropriateness of promotional methods

Methods of Forecasting

Jury executive opinion

•Top executive estimate probable Sales•An average is calculated•The rationale and input material is shared.

Discuss strength & weaknesses

The Delphi Method

•Developed by Rand Corporation•Similar to Jury Executive opinion•But done based on structured questionnaire•Eliminates majority opinion

Discuss Strengths and Weaknesses

Poll of Sales Force Opinion

•Each Sales personnel does an forecast of his territory or assignment base.•Modifications are made by Mgt

Discuss Strength and Weaknesses

Projection of Past Sales method

Add on based the current years sales performanceCould take past several years of actual performance

Current Year SalesNext year Sales = Current Year Sales X ______________

Last year SalesExample: ( figs in units)

110Next year Sales = 110 X _______

90 Next year Sales = 134Generally is around 15% of the past years performance

Time Series Analysis

Similar to past Sales Projections but takes following into consideration

•Long Term trends•Cyclical Changes•Seasonal Variations•Irregular Fluctuations

Survey of Customer Buying plans method

•Seek customer survey•Seek their plans to buy•Then estimate forecast

Discuss Strengths and Weakness

EFFECTIVE SALES EXECUTIVE

Traits of a Effective Sales Executive

•Ability to set personal goals•Matching it with org goals•Splitting the goals to set of activities to perform•Review the activities and modify if needed•Effective Time Management•Ability to plan daily and implement•Ability to exhibit skilled leadership qualities

Relationship with Top Management

•Should exhibit initiative and personal drive•Keep Top Mgt informed on progress•Need to accept responsibility•Should not be indispensable•Effective Problem solvers and decision makers•Keep Management informed on decisions and developments•Report promptly•Do not relay on rumors•Do not seek help on decision making too often, hence diluting authority.

Relation with Product Manager

•Provide vital inputs on product performance•Product jointly decided by Mark, Finance,Production & Sales Dept•Periodic feedback on Product for modification

Relation with Promotion Mgt

•Provide inputs for Promotional Strategy•Help in implementation•Keeps sales team informed on the promotional Plans•Takes advantage of the A & P investment.

Relationship with Pricing

•Decided jointly by Marketing and Sales•Involves Finance, Production, Legal functions etc•Should be aware of competitor’s Pricing•Should have a feel of customer acceptability•Implementation of pricing

SALES RELATED MARKETING POLICIES

Product Policy- What to SellDistribution policy-Whom to SellPricing Policy- What price to sell

The degree of authority for above varies in different companies

PRODUCT POLICY

Product line Policy•Changes in product offering•Re organizing product / line simplification•Re organization of Product line / Diversification•Ideas of new Product•Appraisal of proposal of New Products

Product design Policy

Product Quality/ Service PolicyGuarantee Policy

DISTRIBUTION POLICY

Policy on Marketing Channels

Channel wise sales volume potentialChannel wise net profitability

Policy on Distribution Intensity

Mass distributionSelective DistributionExclusive agency distribution

Case-II Sales ManagementProduct Related Policy: A Multi Product and Multi Brand company has eight brands in the product range of Toilet soaps.The contributions of various products are as follows:   

Discuss on options of Product Line Policy

% of Profit Turn over contribution

PRODUCT A 9% 8%PRODUCT B 11% 9%PRODUCT C 14% 12%PRODUCT D 6% 18%PRODUCT E 2% 11%PRODUCT F -4% 22%PRODUCT G 15% 16%PRODUCT H -2% 4%

Policy on Distribution Intensity

•Mass distribution•Selective Distribution•Exclusive agency distribution

PRICING POLICY

Competition Related PricingMatching the competitor’s pricingPricing above competitorPricing under Competition

Pricing related to costsFull cost pricingPromotional PricingContribution pricing (covering variable cost)

Buyer Based pricing•Based on Volume•Frequency of purchase•Geographical location of customer

List Pricing (Regulated Pricing for middlemen)•Recommended & control dealer price•Leads to customer satisfaction•Helps fight competition uniformly•Consider freight, Govt levies, taxes and other costs of dealer

Policy on Discounts•Wholesaler, Retailer discounts•Turn over discount•Selective product discount

Geographical pricing Policy•FOB ( Free on Board) – (ex works,factory)- used to heavy products industrial products.•Delivered prices ( postage stamp pricing)

Policy on Price leadershipIndustry leader sets price and other followExample: egg, cement, petrol etc

Product line PricingMultiple product pricing structurePlanned enhancementMutual advantage pricing

Competitive bidding policyClosed tendersOpen tenders

PERSONAL SELLING STRATEGYPERSONAL SELLING STRATEGY

•Kind of Sales force•Size of the Sales force•Appropriate deployment

Competitive settings and personal selling strategy

•Pure Competition•Monopolistic Competition•Oligopolistic Competition•No Direct Competition

Pure Competition•Many players•No specific player dominates market•No single player influence demand & supply Marjory•No Govt Regulations on pricing or supply

This hardly exists. If it does-personal selling strategy should be:•Better Service to the customers(Presale & Post Sale)•Organizational efficiency•Cost Management

Oligopolistic Competition•Smaller groups of companies join together•They know each other•Makes difficult for new entrants•Competitors activities are closing watched•Personal selling helps in maintaining dealer co- operation, servicing distribution network•Personal selling effectively uses promotional strategy

No Direct competition•No Direct Competition, but have in direct competition through substitutes•They would capitalize no competition situation•Price skimming or penetration strategy used.•Should aim at vast coverage of market•Personal selling should use pricing and promotion strategy to its advantage.

Personal Selling Strategy Based on

Whom to SellWhat to SellHow to Sell

Product Market analysis-Case-III Example for a Cellular company

Corporate SMEs Business/ Professionals Govt CORPORATE SMESBUSINESS/ PROFESSIONS GOVT

GROUP BOOKING

FREQUENT CALLER SCHEME

LOW CALLER SCHEME

PREPAID SERVICES

Identify Whom,What and How to sell?

Determining the size of the sales force

Work load method

Decide assignment baseClassify based on time needed / calls neededDetermine calls per day/ month/ yearDivide it by assignment base to arrive at number of Sales personnel needed.

Sales Potential method

Productivity based systemConsider average productivityDivide the target with productivity to arrive at sales persons needed

Incremental Method

Based on expected increase in cost/revenue per sales personnel addedCost Benefit compared and decision is takenThis is a good cost conscious and result oriented method

SELECTING SALES PERSONNEL

SELECTING SALES PERSONNEL

Interview

Reference Check

Testing

Physical Examination

Employment Offer

Rejection

Formal Application

Preliminary Interview

SELECTION PROCESS

Formal application formCapture necessary information•Should be structured

Should have:•Personal Information•General Information•Employment record•Educational background•Health•Self assessment•Declaration

Allocate score to each set of information based on the desired job responsibility

Interview

An interview can judge

•Common skills•Personal appearance•Manners•Attitude towards selling•General life•Reaction to obstacles•Personal impact on others

Other Dos in an Interview

•Read the application form•Mark queries•Plan a strategy for interview•Present a ppt in case of large group•Use un-freezing questions•Maintain pleasant rapport

Who should interview?Branch head with his assist—initial interviewShortlist candidate—Reg head or sales chief

How many in the panel?Depends on type of jobInstitutional Sales- Panel recommendedDirect Sales Sales- Sales Manager with his Assist/ HR Rep

Interviewing the spouse

•Check for frequent travelling•Check for working hours•Check for independence

Interview Techniques

Patterned Interview

•Have a structured interview•Job based questions

Non Directive Interview

•Open ended questions•Seek for narration of personal info, job exp, skills, strengths, weakness•Judge based on responses

Interaction (Stress Interview)Simulate Selling EnvironmentSet up situation to understand psychological behaviorNeed trained psychologistsRating Scales methodRate each response in scale of suitability for job.Physical appearanceImpact on othersCommunicationExperienceAttitudeObjections handling skills

This eliminates gender, creed, religion bias.

Credit checks•Check on credit rating•Check for large debts•Check for Financial Responsibility

Psychological testsThe following test can be conducted based on type of selling assignment

•Sales aptitude test•Attitudinal tests•Test for creativity•Industry knowledge•Habitual characteristics•Interest areas

Role Play on InterviewEach team will have to conduct an role play based on discussion on the following aspects of selecting a front line sales personnel for service Industry (Telecom Industry) for handling corporate sales.

The non-directive interview should have the cover the following aspects:

•Put the candidate at ease•Find attitude towards selling•Ability to handle objections•Candidate’s positive attitude•Customer friendly attitude

Rate on the above parameters and give your feedback. Evaluation would be done on the Interviewer.

PLANING SALES TRAININGPLANING SALES TRAINING

Need for Training•Training is a means to supplement and share experience•Reduces initial turn over of Sales personnel

•It replaces the old method of “swim or sink”

Types of Training Programs•Trg for new recruits•Re orientation training for existing sales executives

Following are aspects involved in Training programs

A -- Aim C -- ContentM -- MethodE -- ExecutionE -- Evaluation

Aim•Define job specifications•Trainee’s background and experience•Sales related Marketing policies

Content•Product knowledge•Sales Technique•Market Information•Company profile

Method•Lecture method•Personal Conference/ meeting •Demonstration method•Role Playing•Case Study method•Gaming•On the job Training•Programmed Training (self Interactive CD/ Internet)•Correspondence Course

ExecutionWho should conduct program

Initial Trg ProgramContinuing Sales TrgTrg for the Trainers

Training philosophiesConditioned methodNon conditioned method

When should the Trg be conducted?

After some time in fieldBefore and after field experienceFirst Trg and then fieldModule of “on the job Trg” in Trg program.

Timing of continuing Sales Trg (Reorientation program)•New product Development•Low productivity•New Market segments approach•New Product application•Product Development

Training siteCentralized•Branch level•Other venue

Manuals & Training Aid•Text of the content of Trg program•Case study•Exercises•Product information•Company profile•Objection handling tips

FEEDBACK FORM ON SALES TRAINING TRAINING

Details of the Program___________________ Date:_____________

The Objective of the Feedback is to get an idea of the overall impact and benefit derieved from the program

INSTRUCTIONS FOR FILLINGMark Tick above the smiling sign depending upon the feedback you want to give

Poor Average Good Outstanding

TICK CONTENT OF THE TRAINING PROGRAM

Suggestions

TICK

SCHEDULE OF THE PROGRAM

Suggestions

TICK FACILITIES AND ARRANGEMENTS

Suggestions

Evaluation of the Training Program

TICK QUALITY OF THE TRAINER

Suggestions

TICK ENVIRONMENT FOR LEARNING

Suggestions

TICK TIME SPENT ON CONCEPT AND ROLE PLAY

Suggestions

TICK TRAINING MATERIAL AND AIDS

Suggestions

MOTIVATING SALES PERSONNEL MOTIVATING SALES PERSONNEL

Most of us need motivation periodicallyFew are self starters

What is motivation?•It is goal directed behavior•The amount of effort a person is ready to spend in planning, identifying prospect, sales calls, etc•The needs and desires to achieve target

Motivation help from Management

Management needs to continuously motivate sales personnelCreate a good motivated sales TEAM

Reasons for De-motivation

Due to the nature of Sales jobExhilaration and depression is mixedTurn downsFrequent failuresDifferent customer profileFace the brunt

Role conflictsConflicts of identification with customer companyAdvocator of customer’s point of view

Repeated familiar situations•Same product•Same Territory•Same Customers

Maintain feeling of group identityMake them feel a part of the teamThere is a need to be seen as performer in group

Basic Physiological Needs

Safety and Security Needs

Belongingness & Social Relationship needs

Esteem Needs

Self Actualization Needs

A.H Maslow, Motivation and Personality theory

Achievement Motivational Theory (Self motivated people)They like problem situation and like personal responsibility in finding solutions

•Tend to set attainable goals•Want feedback on how they are doing•Can be found by (TAT )Thematic Apperception Test•They are self driven•They need right environment to perform

Motivation and Communication•We need to establish communication with Sales team•They could have a real of an imagined problem•Sales Personnel need freedom of expression

Interpersonal contact•Meet Sales personnel often personally•Identify Business or personal problems•Arrange conferences, Regional meet to hear their problems

Motivational interviews•Meet Sales personnel face to face•Find out their individual need fulfillment•Gather information bit by bit•Probe to motivate

Written CommunicationKeep the Sales team informed •Letters•Bulletins•Industry information circulars•New developments•Performance charts •Top selling Sales personnel list

SALES BUGETTINGSALES BUGETTING

Budgeting•Important tool for Revenue and cost control•Prepared for calendar or financial year•Further broken down into (monthly, quarterly yearly)•Corrective action needs to be taken•No sales worth enough with no profits•Monthly Budget monitoring a must•Paves the road for profitable management of business•Budget vs. Actual to be compared & variance identified

General Budget Heads

SalesCollection

Sales & Marketing ExpensesEmployee costProduction costOver Heads/ Operation costsDepreciationInterest CostProfit value/ percentages

Branches 2-Apr 2-May 2-Jun

Apr to Jun 02 Total

No. of Copies (000) 90

Product 1 4.0 5.0 6.0 15.0Product 2 1.5 2.5 5.0 9.0product 3 0.2 0.3 0.4 0.9Total Advt. Revenue A 5.7 7.8 11.4 24.9Collection (Cash Inflow) 2.8 4.0 4.9 9.0 20.7SALES & MARKETINGA & P 0.20 - 0.10 0.30 Business Promotion - Commission 0.17 0.23 0.34 - 0.75 Incentive 0.09 0.12 0.17 - 0.37 Customer Relations Mgmt/TelecomCo ordination costMarket ResearchTelemarketingTelesellingProvision For Bad Debts 0.09 0.12 0.17 - 0.38 TOTAL SALES & MARKETING AND PRODUCTION B 0.54 0.47 0.79 1.80 BRANCH EMPLOYEE COST C 0.68 0.68 0.68 2.04

Budget FormatQuarterly Budget

Branch Establishment ExpensesAccomodation/ Brokarage (FF) 0.45 0.45 Conveyance 0.03 0.01 0.02 0.06 Deputation Allowance 0.20 0.20 0.20 0.59 Hire Charges 0.04 . 0.04 Miscellaneous Expenses 0.01 0.01 0.01 0.03 Market Allowance 0.13 0.13 0.13 0.38 Newspaper & Periodicals 0.01 0.01 0.01 0.03 Office Expenses 0.04 0.04 0.04 0.12 Office RentPostage & Courier 0.03 0.03 0.03 0.10 Printing & Stationery 0.05 0.05 Recruitment Expenses 0.05 0.05 Ttraining & Development Expenses 0.03 0.03 0.03 0.08 Repairs & Maintenance 0.02 0.01 0.03 Telephone & Fax Expenses 0.06 0.04 0.04 0.14 Transit Office Expenses 0.20 0.20 Travelling 0.17 0.10 0.12 0.37 Vehicle Maintenance 0.01 0.01 0.02 Water & Electricity 0.04 0.04 0.04 0.12 Regional Office expences 0.24 0.24 0.24 0.73 Finance Charges

TOTAL OF BRANCH OPERATIONAL COST D 1.80 0.89 0.90 - 3.59 GRAND TOTAL OF SALES & MKT, EMP, BR OPERATIONAL COST B+C+D 2.48 2.48 2.48 7.43 PROFIT 3.22 5.32 8.92 9.47

Arp 02 May 02 June 02 Ap-June Total

SALES TERRITORIESSALES TERRITORIES

What is Territory Allocation?

“Sales Territory is grouping of customers and prospects assigned to an individual Sales personnel”

Advantages of Territory Allocation

To achieve better Market Coverage•Helps fight competition•Economical routing possible•Helps in Time Management of the Sales personnel•Easier for repeat follow up

Control Expenses•Reduces Travelling costs•Client servicing cost lowers•Cost per call ration falls

Helps in Evaluation of Sales Personnel•Territory specific market potential chalked out•Actual vs potential can be compared•Local conditions can be considered

Contributes Morale of the Sales Personnel•Convenient for Sales personnel to manage•Reduces Travel fatigue factor•Avoids inter Sales personnel disputes on accounts•Finds more time

Co ordination of Personal Selling and Advertising & Promotional effort•Helps to keep his customers informed on promotional plans•Can have establish feedback on promotion easily•Territory specific promotions can be planned.Effective Database management•Helps maintain and update Territory specific database•Sales performance territory wise•Customer behavior Territory wise

Geographic Territory AllocationBasic shapes of Geographical Territories

•Road wise•Pin Code wise•Industrial zone wise•Major Road and landmark wise•Major parts of the city•City wise•State wise•Region wise

Territory Allocation Based on Type of Business (partly Geographic)

•B2B•B2C•B2BC•Trading Area•Industrial area•Industrial Traders•Residential Area•Commercial Complexes

Territory Allocation Based on market Potential (Non Geographic)

•List all prime segment based in descending order of Priority•Capture database of Segments•Obtain exact numbers in each segment•Estimate sales potential based on past performances in each segment•Match the profile of Sales personnel and area.

Estimating Target for Sales personnel

•Estimate number of Potential customers•Pin down assignment base for individual Sales personnel•Fix conversion percentage for each segment of the assignment Base•Project average order Value•Covert to Sales Target for each Territory

Rules: •Estimate potential target for area and not Sales personnel•This logic will help in changing Territory if needed•The next Salesmen takes over unachieved part of Territory