INTRODUCTION TO SALES MANAGEMENT
Flow of Presentation
Meaning and Objectives of Sales Management Role of Sales Manager Sales Management and Marketing Management Relationships Sales Departments external relations
Types of Sales Organization Structure
Centralization and De- centralization of Sales Force Management
Personal Selling
According to Philip Kotler, Personal Selling involves oral presentation in a conversation with one or more prospective purchaser for the purpose of making sales It is the direct face- to- face communication between a seller and a potential customer
It is a form of two- way communication unlike Advertising, Sales Promotion etc.
Sales Management
Sales Management is an integral sub- system of Marketing Management Sales Management is the administration of the personal selling activities of the organization In a modern organization, Sales Management centers around the management of sales force and sales efforts
Definition of Sales Management
The American Marketing Association defines Sales Management as the planning, direction, and control of personal selling, including recruiting, selecting, equipping, assigning, routing, supervising, paying and motivating as these tasks apply to the personal sales force Sales Management refers to planning the personal selling effort, organizing the sales personnel and developing a winning sales team Brech defined Sales Management as the overall management of sales and it refers to only a specialized application of the process of management as a whole
Sales Management V/s Sales force Management
Modern Sales Managers have broader responsibilities than just managing the sales force Even though their primary responsibility is management of the personal sales force, that do not comprise their total responsibility So we call the personnel- related responsibilities of Sales Managers as Sales force Management In other words, Sales force Management is just a part of Sales Management
Objectives/ Functions/ Responsibilities / Role of Sales Management/ Sales Manager
From the company viewpoint, Sales Management has 3 general objectives: 1. Sales volume 2. Contribution to profits, and, 3. Continuing growth
The following are the most important duties and responsibilities of a Sales Manager: a) Planning the personnel selling effort: Determine precisely the place of personal selling in the marketing mix of the firm and to set the personal selling objectives b) Merchandising: is defined as planning to offer the right , products at the right time, in the right quantities, and at the right price
Objectives/ Functions/ Responsibilities / Role of Sales Management/ Sales Manager c) Marketing research: Sales Manager has to organize and manage marketing research projects
d) Developing a winning sales team: Sales Manager is responsible for recruiting, selecting and training the sales force, its compensation, supervision, motivation and control
e) Distribution channels: The Sales Manager has to select proper channels of distribution and maintain good relations with distributors and dealers f) Financing the sales: The Sales Manager is responsible for providing and managing funds for marketing
Objectives/ Functions/ Responsibilities / Role of Sales Management/ Sales Manager g) Building the sales organization: The Sales Managers are required to ensure that the sales organization (sales department) is maintained in trim condition and capable of effectively implementing the personal selling program of the firm h) Sales Promotion and Advertising: The Sales Manager is responsible for advertising and sales promotion to create, maintain and extend the consumer demand
Selling V/s Marketing
Selling 1. Emphasis is on the product 2. Internal- company (seller) orientation 3. Emphasis is on the sellers needs 4. Narrow in scope Marketing 1. Emphasis is on the customers needs 2. External- market (customer) orientation 3. Emphasis is on the buyers needs 4. Wider in scope
Sales Management and Marketing Management Relationships
According to Philip Kotler, Marketing management is the art and science of choosing target markets and getting, keeping, and growing customers through creating, delivering, and communicating superior customer value According to William J. Stanton, Marketing Management is the marketing concept in action Marketing Management is a wider term and it includes Sales Management also Sales Management refers to the overall management of sales
Sales Management V/s Marketing Management
1. Meaning: Write the definitions of both MM and SM (Already given) 2. Concept: MM is a modern concept while SM is an old concept 3. Object: The object of MM is to satisfy the needs of the consumers and thereby maximize the profit of the concern. On the other hand, the object of SM is to maximize sales with emphasis on volume 4. Scope: MM is a broad term and includes SM. SM is a narrow term and is a part of MM 5. Performance of Activities: The activities of MM are superior while the activities of SM come under the jurisdiction of MM
Sales Departments External Relations
1. Final Buyer Relations 2. Industry Relations 3. Government Relations 4. Educational Relations 5. Press Relations Refer Page 216 of Cundiff Still Text
Types of Sales Organization Structure
The basic types of sales organization structures are: 1. Line Sales Organization 2. Line and Staff Sales Organization
3. Functional Sales Organization
4. Committee Sales Organization
Types of Sales Organization Structure
1. Line Sales Organization It is the oldest and simplest sales organizational structure. It is often used by small firms. It usually consists of only a few managers, who exercise authority over specific functional areas of the business, such as production, finance, or sales Refer Diagram on Page 191 of Cundiff and Still Text
Types of Sales Organization Structure
2. Line and Staff Sales Organization It is often found in large and medium- sized firms, employing substantial number of sales personnel, and selling diversified product lines over wide geographic areas It creates more functional areas Refer Diagram on Page 194 of Cundiff and Still Text
Types of Sales Organization Structure
3. Functional Sales Organization The principle of specialization is utilized to the full extent in Functional Sales Organization The staff specialist is given line authority to control his or her function throughout the organization Refer Diagram on Page 196 of Cundiff and Still Text
Types of Sales Organization Structure
4. Committee Sales Organization Many firms have a sales training committee comprised of the general sales manager, his or her assistants, the sales training manager etc. It meets periodically to draft training plans and formulate sales training policies
Centralization and Decentralization of Sales Force Management In the centralized sales organization, almost all the activities including sales force management, are administered from a central headquarters The central sales office has full responsibility for recruiting, selecting, training, compensating, supervising, motivating, controlling, and evaluating the sales force In the decentralized organization, all these activities are handled by field sales executives
Centralization and Decentralization of Sales Force Management Advantages of centralization 1. Links selling with sales promotion and advertising 2. Simplifies administrative work
3. Makes it easier to organize territories
4. Aids in the effectiveness of the sales plan
5. Reduces bias in the hiring process
Centralization and Decentralization of Sales Force Management
Disadvantages of centralization 1. Assigns decision- making authority to individuals who may be hundreds or thousands of miles away from the action
2. Limits understanding of territorial conditions
3. Reduces time to work closely the salespeople in the field
4. Increases geographical differences in preferences
Centralization and Decentralization of Sales Force Management
Advantages of decentralization 1. Increases in- depth coverage of the market, resulting in higher sales 2. Increases control of the market, resulting in increased sales 3. Improves direction of the sales force in creating greater sales 4. Improves customer services, which will lead to more sales 5. Reduces the need for territorial break- in time, as salespeople are from the area 6. Improves salespeoples attitudes because of the reduction in travel time and fewer nights away from home 7. Reduces travel expenses
Centralization and Decentralization of Sales Force Management
Disadvantages of de-centralization [Link] costs resulting from a duplication of overhead costs at each branch [Link] to follow the plans from the main office creates management problems where geographical differences are important Refer Page 198 of Cundiff Still Text
