Personal Selling

Defining Personal Selling

Personal selling is when salespersons use a process to engage customers and take a sales order that may not otherwise have been made.

Learning Objectives

Compare and contrast sales and marketing functions within organizations

Key Takeaways

Key Points

  • The personal selling process is a 7 step approach: prospecting, pre-approach, approach, presentation, meeting objections, closing the sale, and follow-up. Each step of the process has sales-related issues, skills, and training needs, as well as marketing solutions to improve each discrete step.
  • Marketing and sales differ greatly, but have the same goal. Marketing improves the selling environment and plays a very important role in sales.
  • Many companies find it challenging to get marketing and sales on the same page. The two departments, although different in nature, handle very similar concepts and have to work together for sales to be successful.

Key Terms

  • sales process engineering: The systematic application of scientific and mathematical principles to achieve the practical goals of a particular sales process. Selden pointed out that in this context, sales referred to the output of a process involving a variety of functions across an organization, and not that of a “sales department” alone. Primary areas of application span functions including sales, marketing, and customer service.

Introducing Personal Selling

Personal selling is when a company uses salespersons to build a relationship and engage customers to determine their needs and attain a sales order that may not otherwise have been placed. The personal selling process is a seven step approach: prospecting, pre-approach, approach, presentation, meeting objections, closing the sale, and follow-up.

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Personal Sales Meeting: Meeting the customer face-to-face to makes the sales process more personalized.

The sales cycle, more generally speaking, turns leads into prospects, suspects into prospects and prospects into customers.

Prospecting is the step where salespeople determine leads or prospects. The pre-approach is used for preparing for the presentation through customer research and goal planning for the presentation. The approach is when the salesperson initially meets with the customer and determines a customer’s wants and needs. Once the salesperson knows the needs, he or she is ready for the presentation that will entice the customer to commit. After the presentation, a salesperson must meet objections or address customer concerns. Gaining commitment comes next. Finally, the salesperson must remember to follow up after the sale is made.

The sales department would aim to improve the interaction between the customer and the sales facility or mechanism and or salesperson. Sales management would break down the selling process and then increase the effectiveness of the discrete processes as well as the interaction between processes. For example, in many out-bound sales environments, each step in the typical process outlined above has sales-related issues, skills, and training needs, as well as marketing solutions to improve each discrete step.

The Relationship of Sales & Marketing

Marketing and sales differ greatly, but have the same goal. Marketing improves the selling environment and plays a very important role in sales. If the marketing department generates a list of potential customers, sales will benefit. The goal of a marketing department is to increase the number of interactions between potential customers and the organization. Achieving this goal may involve the sales team using promotional techniques such as advertising, sales promotion, publicity, creating new sales channels, or creating new products.

The relatively new field of sales process engineering views “sales” as the output of a larger system, not just as the output of one department. The larger system includes many functional areas within an organization. From this perspective, “sales” and “marketing,” among others, represent a number of processes whose inputs and outputs supply one another to varying degrees. In this context, improving an “output” (such as sales) involves studying and improving the broader sales process, as in any system, since the component functional areas interact and are interdependent.

Most large corporations structure their marketing departments in a similar fashion to sales departments and the managers of these teams must coordinate efforts in order to drive profits and business success. For example, an “inbound” focused campaign seeks to drive more customers “through the door”, giving the sales department a better chance of selling their product to the consumer.

Many companies find it challenging to get marketing and sales on the same page. The two departments, although different in nature, handle very similar concepts and have to work together for sales to be successful. Building a good relationship between the two that encourages communication can be the key to success – even in a down economy.

Value of Personal Selling

Personal selling minimizes wasted effort, measures marketing ROI better than most tools, promotes sales, and boosts word of mouth marketing.

Learning Objectives

Discuss the advantages and disadvantages of personal selling

Key Takeaways

Key Points

  • Since the effects of marketing are difficult to measure, personal selling gives insight into customer habits and responses to a particular marketing campaign or product offer.
  • Sales people can tailor their presentations to fit the needs, motives, and behavior of individual customers. As sales people see the prospect’s reaction to a sales approach, they can immediately adjust as needed.
  • High cost is the primary disadvantage of personal selling. With increased competition, higher travel and lodging costs, and higher salaries, the cost per sales contract continues to increase.

Key Terms

  • marketing mix: A business tool used in marketing products; often crucial when determining a product or brand’s unique selling point. Often synonymous with the four Ps: price, product, promotion, and place.

Personal selling aims to improve the interaction between the customer and the sales facility, and/or salesperson. Since the effects of marketing are difficult to measure, personal selling gives insight into customer habits and responses to a particular marketing campaign or product offer.

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Making the Sale: Personal selling allows flexibility in presentation to generate sales.

Advantages of Personal Selling

The most significant strength of personal selling is its flexibility. Salespeople can tailor their presentations to fit the needs, motives, and behavior of individual customers. As sales people see the prospect’s reaction to a sales approach, they can immediately adjust as needed.

Personal selling also minimizes waste effort. Advertisers typically expend time and money to send a mass message about a product to many people outside the target market. In personal selling, the sales force pinpoints the target market, makes a contact, and expends effort that has a strong probability of leading to a sale.

Consequently, an additional strength of personal selling is that measuring effectiveness and determining the return on investment are far more straightforward for personal selling than for other marketing communication tools, where recall or attitude change is often the only measurable effect.

The fourth benefit of personal selling is that a salesperson is in an excellent position to encourage the customer to act. The one-on-one interaction of personal selling means that a salesperson can effectively respond to and overcome objections (customers’ concerns or reservations about the product) so that the customer is more likely to buy. Sales people can also offer many specific reasons to persuade a customer to buy, in contrast to the general reasons that an ad may urge customers to take immediate action.

A final strength of personal selling is the multiple tasks the sales force can perform. For instance, in addition to selling, a sales person can collect payment service or repair products, return products, and collect product and marketing information. In fact, sales people are often best at disseminating negative and positive word-of-mouth product information.

Disadvantages of Personal Selling

High cost is the primary disadvantage of personal selling. With increased competition, higher travel and lodging costs, and higher salaries, the cost per sales contract continues to increase. Many companies try to control sales costs by compensating sales representatives based on commission only, thereby guaranteeing that salespeople get paid only if they generate sales. However, commission-only salespeople may become risk-averse and only call on clients who have the highest potential return. These sales people, then, may miss opportunities to develop a broad base of potential customers that could generate higher sales revenues in the long run.Companies can also reduce sales costs by using complementary techniques, such as telemarketing, direct mail, toll-free numbers for interested customers, and online communication with qualified prospects. Telemarketing and online communication can further reduce costs by serving as an actual selling vehicle. Both technologies can deliver sales messages, respond to questions, take payment, and follow up.

A second disadvantage of personal selling is the problem of finding and retaining high quality people. First, experienced sales people sometimes realize that the only way their income can outpace their cost-of-living increase is to change jobs. Second, because of the push for profitability, businesses try to hire experienced salespeople away from competitors rather than hiring college graduates, who take three to five years to reach the level of productivity of more experienced salespeople. These two staffing issues have caused high turnover in many sales forces.

Another weakness of personal selling is message inconsistency. Many salespeople view themselves as independent from the organization, so they design their own sales techniques, use their own message strategies, and engage in questionable ploys to create a sale. Consequently, it is difficult to find a unified company or product message within a sales force, or between the sales force and the rest of the marketing mix.

A final weakness is that sales force members have different levels of motivation. Sales people may vary in their willingness to make the desired sales calls each day; to make service calls that do not lead directly to sales; or to use new technology, such as a laptop, e-mail, or the company’s Web site. Finally, overzealous sales representatives may tread a thin line between ethical and unethical sales techniques. The difference between a friendly lunch and commercial bribery is sometimes blurred