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Unit 13Structure: 13.1

Personal Communication Channels

Introduction Learning Objectives 13.2 Personal Selling 13.2.1 Nature of Personal Selling 13.2.2 Personal Selling Approaches 13.2.3 Advantages and Disadvantages of Personal Selling 13.3 Sales Management Basics 13.4 Human Resource (HR) Practices in Sales Management 13.4.1 Recruiting 13.4.2 Selecting 13.4.3 Training 13.4.4 Training Programme 13.4.5 Training Methods 13.4.6 Evaluation of Training 13.5 Personal Selling Process 13.6 Direct Marketing 13.7 Summary 13.8 Terminal Questions 13.9 Answers 13.10 Mini-Case

13.1 IntroductionAdvertisement clutter and large product assortment are posing new challenges. One of the major challenges is how to reach consumer. The indirect media has an influence on consumer but its effectiveness in generating the sales has diminished over the period. Organizations are looking towards interpersonal communications. As we discussed in the last chapter, companies are encouraging word of mouth communication and viral marketing. They are concentrating on enhancing the effectiveness and efficiency of their sale force. In this unit, we are discussing the personal selling, sales force management and direct marketing concepts

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Learning Objectives After studying this unit, you will be able to: Define personal selling Understand the process of personal selling Analyze the sales management techniques. Identify and discuss the major forms of direct marketing.

13.2 Personal SellingInvolves the communication technique in which sales people build the personal relationship with customers to generate the value for the organization. The value may be sales and benefits to the customer. The value may not be only financial gains, but it may be providing the information to customer. For example, Medical representatives of CIPLA provide the information to doctors and they dont actually sell the medicine to them. 13.2.1 Nature of Personal Selling Personal selling has experienced a paradigm shift. There was a time when sales jobs were perceived to be low. The emergence of modern corporations and rise of new India is in dire need of professional selling. Nowadays it is not mere selling. It is using professional skills to have a long term relationship with the customers to generate the value continuously. This has resulted in the growth of professional sales force. Even companies that believed in marketing through channels entered into personal selling. For example, Hindustan Unilever Limited (HUL) which is having retail and wholesale channels, recently entered into the network marketing. There are various types of sales jobs used to sell the product of the organizations. They are: 1. Delivering: The job of sales executive is to make the products reach to the customer destination. For example, a sales person working for transport or Courier Company has to make the goods reach the customer places. 2. Inside order taker: Sales executives in the retail stores like Subhiksha help the customer in identifying the product. The person in the hotel takes the order and serves better.Sikkim Manipal University Page No. 261

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3. Outside order: These are field executives who go to the customer place and get the order. 4. Missionary selling: Sales executives provide the information and promote the company products like for example- medical representatives. 5. Sales executives: In this position, the sales executive is technical expert and works with nontechnical sales executives to provide assistance on technical information sought by the customer. 13.2.2 Personal Selling Approaches 1. Stimulus response selling: In this approach, sales person provides the stimulus and expects the response from the buyer. This process will continue till purchase decision has been made. For example, salesperson will tell the customer that the price offer for a particular product is available for only 2 days and then might wait for the customer to accept the offer within 2 days. 2. Need satisfaction selling: In this approach, sales executive identifies the need of the product in the customer and confirms it. He provides the various offerings to the customer to choose and continues this process till the purchase has been made. For example, if a customer is looking for specific features in a product, then salesperson will show him the products having those features and will suggest to him variety of options to choose from. 3. Problem solving selling: This approach is used when the customer faces the purchasing problem. In this approach, sales executive defines the problem of the customer, generates the alternative solution and evaluates them. Then he works with the particular solution till the customer purchase. For example, when customer is not sure about the type of brand he wants or the kind of features he needs in the product, then the salesperson will tell him about other particular brands available or in the second case, will identify his product needs first and then suggest products having those features that will fulfill his needs. Situations when personal selling is favourable 1. The price of the product is high, technical in nature and needs demonstration. 2. The product is in the introductory stage of the product life cycle.Sikkim Manipal University Page No. 262

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3. Organization does not have enough money campaigns. 4. Product can be customized and 5. Market is concentrated.

for

advertisement

13.2.3 Advantages and Disadvantages of Personal Selling Advantages 1. It can be customized since personal element or face to face contact is involved between the salesperson and prospective customer. 2. It can focus on prospective customers as well as cater to the existing customers. 3. It results in the actual sale, while most other forms of promotion are used in moving the customer closer to the sale. 4. It is very helpful in maintaining long-term customer relationships and in Customer Relationship management 5. It is applicable when products have to be demonstrated and certain features or information has to be specifically explained to the consumers. 6. Conveniently suits certain product categories such as consumer durables washing machines, dishwashers, air-conditioners, etc.; highly technical items such as computers, laptops, etc.; automobiles, industrial goods, pharmaceutical products etc. Disadvantages 1. It is costly to develop and operate an effective and efficient sales force. 2. Not effective because at a time the sales person can target one or two customers and so it lacks mass appeal. 3. It is very difficult to attract upper class people. 4. It is not appropriate for all types of products as some products may not require any personal selling. Activity 1: Find out any dealer shop or outlet in your area that uses personal selling to market its products. Highlight its benefits and drawbacks.

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13.3 Sales Management BasicsThe activity of procuring, training, developing and managing sales force for the purpose of achieving more customers or sales and also to maintain existing customers can be called as Sales Management. Sales management involves certain basic or key aspects which are a) Deciding the sales territory This is the geographical boundary set for sales executives to work in. The objective of setting up territory is to avoid the conflict between two sales executives. This will help to set particular quota for sales executives and shall be used for performance evaluation. b) Determining Sales force size The sales force size is decided by the work load method. Work load method consists of Identification of customers and grouping them into different categories. Listing out the activities that sales executive has to perform. Finding out the time available for selling and non selling activities of sales executives. Analyzing the number of calls one has to do in a particular period. Calculating the number of sales people required. c) Sales organization Sales activities in the organization are allotted on the basis of geography (Bangalore, Mumbai etc.), product (personal care, water purifier etc) customer (steel companies, electric companies etc) or having a matrix type of organization to show the assignments and allocations of each sales person. This helps company to have better control over the sales executives.

13.4

HR Practices in Sales Management

The important tasks in order to make Sales management effective and efficient include the following HR practices which are normally adopted in any organization:

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13.4.1 Recruiting Recruitment is a process of finding out candidates, who are encouraged to apply. Selection is process of choosing or short-listing some suitable candidates out of many those who have applied. Therefore, we can say that selection is recruitment, but recruitment is not selection. Selection is a process of rejection of unfits. Recruitment precedes the selection process. After deciding the number of salespersons and the objectives, the sales manager must select personnel. The usual sources of recruitment may be either internal or external. Internal Sources: Many firms feel that the best policy to fill the vacancies of salespersons is from the existing employees of the same organization. It may also be termed as promotion. This can well be adopted by analyzing the ability and promising character of the staff on the basis of seniority i.e., length of services. Merits: 1. Much co-operation can be expected. 2. They are loyal. 3. Since it is a promotion, sincere and honest performance can be expected. 4. They may not need training. 5. They may not need high salary. Demerits: 1. There is limited scope for selection. 2. Favoritism plays its role. 3. The person may not adjust himself to the new job as the nature of work is different. Apart from the internal selection, ex-employees of the company can also be appointed if they are willing to accept a job. This policy is better and can profitably be adopted. External Sources: We have the following sources: 1. Employment Exchange 2. Competitors organization 3. Salesperson of non-competing firms 4. Educational InstitutionsSikkim Manipal University Page No. 265

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5. Recommended cases 6. Advertisement 7. Unsolicited applications etc. 1) Employment Exchange: Private and public employment exchanges are the best source of personnel. They maintain proper registers with names and other full details of persons, such as job referred by those who seek jobs. The sales manager can call persons from exchange, by giving job specification to the officer concerned. In almost all cases the candidates may be untrained; and inexperienced hands requiring further training. 2) Competitors Organization: The salespersons employed in other competing firms can also be chosen. But this method is not morally accepted. He may be trained and may be developing his firm. Such a person can be drawn by temptation when he is offered more facilities and a higher salary. But it must be verified how far he is able to meet the sales objectives, considering his sincerity, loyalty, habits etc Such a man, when he gets some additional benefits from some other firms, will follow the same tactics i.e., leave the firm. 3) Salespersons of Non-competing Firms: Salesperson can also be chosen from non-competing firms. Such persons may have experience in the line, if not touch with the particular product. They may need training to come up to the level of aimed sales objectives. 4) Educational Institutions: Advanced countries like America, England etc., select students directly from specialized institutions, where theoretical and practical knowledge is gained by them. The Institutional Heads maintain complete records of students but as far as India is concerned, the chances are rare. It has been neglected with the feeling, just from egg i.e., inexperienced. 5) Recommended Cases: The employees of the firm - managers, superintendents, section heads etc., may recommend candidates from their friend circles. They have a moral responsibility when such persons are recruited. The employee who recommends personnel will be blamed, if the person is incapable of doing the assigned work. .

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6) Advertisement: This is a generally accepted system of recruiting salespeople by firms. Advertisements are displayed in newspapers, trade journals specifying the job and the required qualifications, experience and skill. There is the possibility of a wider scope of selection, as the news spreads over a wide geographical area. 13.4.2 Selecting Selection procedure differs from firm to firm. Each firm has got its own method in choosing people for employment. The qualities that the recruiters seek in people to be appointed, depends on the job description. Similarly the selection method also depends upon the sales management. Generally, the following steps are followed: 1. Application blank 2. Screening 3. Reference 4. Personal interview 5. Test 6. Medical examination 7. Final interview (appointment) 1. Application Blank: Necessary information about the applicant is required to be considered for appointment. Generally, the candidates are asked to apply on companys application form, sent directly to applicants against a requisition, or an application known as application blank is given in the advertisement itself. This is with a view to gather only the necessary details of the applicants. It contains a number of questions, which after being filled, gives a clear idea about the candidate. Generally, it may contain the name, sex, qualification, age, experience, health, social activities, address, references etc. 2. Screening: All applications will not be considered. Screening is a process by which applications are to be screened out (rejected) from further consideration, on the basis of unsuitability. The remaining applications are formally considered for appointment, subject to further formalities. By rejecting the applications of unqualified applicants, much time and energy can be saved in further processing. 3. Reference: Generally, it is a common practice to ask the applicant to mention the names of two references or referees, to whom the salesSikkim Manipal University Page No. 267

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manager can make enquiries about the integrity, general character and ability of the applicant concerned. The qualities are checked with care and caution by the sales manager, by contacting the referees. If the opinions are favorable, the applications pass on to the next stage; and in case the referee gives unfavorable comment, the application is rejected at this stage. Personal contact is necessary and it is better, because people are straight forward in tongue better than in pen. This is one-sided, but the effectiveness of such opinion is doubted, as there may be chances of telling only the good qualities of applicants. Moreover, only the names of such favorable persons are mentioned in reference, with preintimation. To overcome this, personal interview is essential. 4. Personal Interview: This is an important step in the process of selection. Only the screened applications are considered for selection to which the firm sends out interview letters. Personal interview is a must. Through this interview, the sales manager can understand the positive and negative qualities of the applicant, with reference to the job duties. A good interviewer must be unbiased, able to discover facts and be a keen observer of the interviewee. Interviews are also of two types: (a) Patterned and non-patterned. Under patterned interview, questions are designed and the same questions are asked to all, which is easy for comparison purposes. (b) In non-patterned interview, no standardized questions are asked. The applicant is allowed to talk freely. A few direct questions are asked. In this type of interview, the applicant gets a chance of speaking about his attitude and interest freely. The interviewer must be able to make an easy evaluation of the interview. 5. Tests: Test is an additional tool, with which the applicants are further tested to determine their suitability for the job. Generally, following are the important types of psychological tests conducted: i) Ability Test: This test is devised to ascertain the capacity to grasp things, and is a measure to know how well a person performs a particular task with motivation. This can also be called a mental ability or intelligence test. Such tests determine the suitability of a candidate for a particular job.Sikkim Manipal University Page No. 268

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ii) Habitual Characteristic Test: A person may be intelligent but may hesitate to take a decision. This test is aimed to know ones aptitude and interest on normal, daily work, irrespective of the best behavior occasionally. iii) Achievement Test: This test is designed to know what knowledge a person has gained from his education or training. By all these psychological tests, the ability and suitability of a candidate can be verified. One can aim to evaluate the honesty, cheerfulness, leadership quality, assertiveness, co-operation, supervision capacity, emotional stability, determination, ability etc., of the personnel. The effectiveness and reliability of these tests are questionable, as the qualities cannot be measured exactly and the circumstances to be faced by salespersons are also different. 6. Medical Examination: The important thing about any person, apart from all qualities and eligibility, is that he/she must be physically fit for the job. Diseases and physical deficiencies of the salesperson will affect the business. As such, selected applicants have to undergo medical examination. 7. Final Interview and Appointment: The selected applicant is probably, called for a final interview and his/her suitability is measured through different tests, physical reports etc. Once confirmed, appointment letter will be given to the person and the job will t be explained to him/her, along with all relevant details, which are required to perform the duties efficiently. If everything is in favor of the applicant, an agreement must be executed by him/her. Generally, the agreement contains duties and authorities, sales quota, sales territory allotted, salary and conditions of resigning. It is followed by an appointment order, which contains designation, jobs to be performed, salary and other financial benefits etc. 13.4.3 Training Training is a continuation of selection. Having selected the salesmen, there are two options. They can be sent to the field directly with samples, order books etc., and/or they can be sent for training programme. Some people think that salesmanship is born, but there are no born salesmen like thereSikkim Manipal University Page No. 269

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are no born doctors, lawyer, engineers, teachers etc. However, all these people need training to call them qualified, and so also is the case with salespersons. A person may have interest in the profession. Thiess interest can be fully developed, through proper training. One attains perfection, selfdevelopment etc., through training. Training means the process of perfecting the salespersons for their work. Training programmes are organized procedures or methods through which knowledge as well as skill, for a definite purpose, is acquired. By training, one can increase knowledge in a particular field. The salesmanship is not born but can be made effective through training. Significance of Training: The present era of marketing world is full of stiff and cut-throat competition. The world is dynamic and not static. Customers are more benefit-oriented. Producers, in order to meet the ever-changing demands of the consumers, produce new products, new devices, and products with multiple uses and so on. Thus, training or repeated training is essential to keep the salesmen, with up-to-date knowledge, in respect of new or developed goods. Training gives scope for improvement. Objectives of Training: The objectives are summed up below: 1. To facilitate the salespersons to acquire the techniques and principles of salesmanship, process of sales, canvassing etc. 2. To bring down the labor turnover in the sales force. 3. To facilitate better sales performance. 4. To improve the relations with the customers. 5. To increase the efficiency of sales personnel. 6. To keep the salesperson informed about the products, market, competitors etc., to face different situations. 7. To lower the selling expense so as to increase the profits. 8. To maintain sound relations between employer and employee. 9. To develop better knowledge, and the ways and means to resist all undesirable situations. 10. To motivate the consumers more effectively. Advantages of Training to Salespersons 1. A trained salesperson always wins customers by systematic approach.

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2. Salesperson acquires better understanding of the firm, as to its past history, policies and procedures and this helps the salesperson for effective dealings. 3. A trained salesperson takes less time in concluding a sale-early selling maturity. 4. A trained salesperson brings increased volume of sales, in turn, more profit to the firm and himself/herself. 5. A trained salesperson is able to meet consumers demand and help in solving problems. 6. Increased volume of sales facilitates reduction in cost of production i.e., sales rise faster than expected. The cost per unit of order or per prospect can be minimized. 7. A better relationship is created among the customers through reducing customers complaint, increasing brand loyalty etc. Customers satisfaction is gained. 8. The ability of the salesperson is increased by expert knowledge. 9. Controlling of salespersons becomes easy. 10. Training facilitates better demonstrations, selling the products which have high profit margin, better methods of canvassing etc. Sales training helps to increase the sales volume. Supervision cost is reduced as trained salesperson needs less supervision. 13.4.4 Training Programme A firm should chalk out a programme for sales training. The training is based on the nature of the job and the products to be sold. A planned training programme should function with the following ideas or principles, often referred to as ACMEE. A: Aim of Training C: Content of Training M: Method of Training E: Execution of Training E: Evaluation. 1. Aim of Training: The whole idea behind the training is to make a recruit a good salesperson. It is true that some of the qualities of a good salesperson may be inherent, but not all qualities. It is the training which makes him/her have all qualities required of a salesperson. It must aim to make him/her a guide to the buyer, taking into account his/her needs,Sikkim Manipal University Page No. 271

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problems etc. and to make him/her a salesperson of effective power by which an interest in the product may be aroused and a desire to purchase may be created. 2. Content of Training: No hard and fast rules can be laid down as to the contents of training. The content of the training programme relates to the subject-matter of training. A training programme varies from firm to firm, because of the differences in products, markets, policies of the company, trainees ability etc. In general terms, sales training is the teaching of salesperson and prospective salespersons how to do their jobs better. A good training programme facilitates the traineesalesperson to learn and understand the following aspects: a) The knowledge of the job b) The products c) The company or the organization d) The markets and consumers e) The competitors f) The sales techniques g) The routine reports etc. a) The Knowledge of his/her Job: The job of a salesperson is not complete, as soon as the transfer of goods takes place. Today, the salespersons carry out more work than the salesperson who merely takes orders. He/she must understand what the firm expects of him/her; what power he possesses and how to convince the buyers about the companys product and image. The company assigns responsibilities and powers, with which he/she works as a guide to buyers by projecting the merits of the products and on the other hand with profit to the firm. He is expected to do services to both the firm and the customers. He must have concrete plans as to his sales planning, meeting customers, sales talks, demonstration, presenting the goods, concluding sales, securing order, collecting dues, handling objections and complaints etc. Apart from these, he must be a keen observer of market conditions, competition, consumers likes and dislikes etc. He should co-operate with his senior fellows. Thus, he is trained with a purpose, the aim of his appointment being to know what the firm eagerly expects from him.Sikkim Manipal University Page No. 272

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b) The Products: A good understanding of the product is essential. The firm must give or ensure that the salesman has a thorough knowledge of the products to be dealt with. In brief, they are: 1. Raw materials used in the product. 2. Manufacturing methods in brief. 3. Research and development undertaken. 4. Improvement made. 5. Its suitability to the consumers. 6. Its trade mark, brand, characteristics. 7. Its color, weight, packaging, quality control etc. 8. Selling points of the products. 9. Product merits and uses to consumers. 10. Limitation of the product performance. 11. Its price and discounts offered. 12. Service, after sales and guarantee period. 13. Demonstration of its actual working. 14. Availability of the products. 15. Cost of operation and maintenance. 16. Comparative study of similar or competitive products. 17. Strengths and weaknesses of competitors products. 18. The position of the product in the product line. The above-said knowledge of the products is essential for a salesperson so as to emerge as a creative salesperson. When the salesperson has a sound knowledge, he/she meets the public and converts them as buyers, in a better and more efficient way. c) The Company: A clear-cut knowledge about the company is essential to the salesperson to enable him to work accordingly. A salesperson should be well-informed about the following: 1) Brief history of the organization or company 2) Organizational hierarchy, top management and key people, organizations stake-holders and investors 3) Organizations objectives and purposes 4) Economic and social objectives 5) Past performances of the company 6) Future plans and ventures of the company 7) Its position in the market or in the industrySikkim Manipal University Page No. 273

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8) Credit policies, sales policies, personnel policies 9) Capacity of the plant 10) Execution and handling of orders, sales accounting and collection methods 11) Salary structure, commission computation, traveling and daily allowances etc. and their payment procedures 12) Method of exercising control over sales methods 13) Allocation of quotas and territories 14) Marketing policies, pricing policies, etc. 15) Long term customers of the company d) The Markets and Consumers: Information about the market is an important and essential part of the training programme. The salesperson must have a thorough knowledge of the size of the market, demand for the products and the area under the competitors side. Besides the knowledge of the market, salesperson should know about the type of customers, buying motives, likes and dislikes of the products. Different types of customers need different types of approaches. People differ widely from person to person, sex to sex, age to age, place to place etc. Different persons require specialized ways of persuasion. The salesperson must adjust him/her according to the nature of the customers. A blanket policy to all classes of people is not advisable. e) The Competition: Salespersons must be given a good knowledge or comparative study of the selling activities of rivals. Study relating to comparison with the rivals as to the merits and demerits of the product is important i.e., strong as well as weak points. The salesperson should know the rival firms policies, method of approaching the customers, how they are paid, customers opinion, how their product is, how they fulfill their duties, the features they like or dislike, their selling-points etc. f) The Sales Techniques: The sales techniques are the essential part in sales training. After the training, the salesperson has to be sent to the field, where he/she has to sell the companys product. He/she must be given exhaustive training in Sales Process. The selling points must be correlated and sales talk be applied at the appropriate situation. A born salesperson has to be instructed withPage No. 274

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the various selling techniques in detail. In short, training on the following items must be imparted. a) Selling process. b) Method of gaining interview from consumers. c) Method of approach to consumers. d) Demonstration and presentation. e) Method of handling objections of consumers. f) Reasons for failure of salesperson in the field etc. g) Routine Reports: Salespersons should be trained to know their routine work and submit their reports to the firm. The report may include: a) Amount (quantity/units and money value) of sales made. b) List of new customers. c) Credit outstanding of customers. d) Collection of outstanding dues. e) Competitors position in the market. f) Maintenance of accounts of expenses. g) Demonstration and display of products. h) Action taken on complaints, grievances etc. i) The attitude of market in respect of competitors. j) Consumers suggestions or experience with the product if any. The reports may be sent to the firm, daily, weekly or monthly etc. as directed. The salespersons are eyes and ears of the selling firm. The salesperson must be aware of the method of reporting and its importance. Training Needs of Salespersons at Different Times: New Salespersons Need: 1. Facts about the company-history, policies etc. 2. Product details 3. Companys system and procedures 4. Fundamentals of selling their specific products 5. Moral training Regular Salespersons need 1. The subject matter of the above five aspects 2. Changes in policies and proceduresSikkim Manipal University Page No. 275

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3. 4. 5. 6.

Facts about new products Future plans of the company Knowledge to supervise others Know-how to discharge responsibility (or delegation of duties)

Supervisors Need: 1. Skill needed to discharge duties 2. Ability to train others 3. Ability to organize 4. Ability to analyze and plan 5. Ability to evaluate and follow up 13.4.5 Training Methods For imparting training to the salespersons, different methods are being used. Broadly, these methods may be divided into two: 1. Group Training a) Lecture Method: An expert or a lecturer speaks to traineesalespersons about the various aspects of selling. It consists of oral talk in a classroom. This system is widely used. The trainees listen to the lectures. The instructor invites questions and answers from them. To make the lecture more interesting, visual aids, demonstration, suitable examples may be added. This system is more economical, and is the easiest and quickest in imparting theoretical training to a group of salespersons. But it is difficult to evaluate the effectiveness of lecture method. This method can be used more effectively in continuing sales training programme to provide new information or changes in the policies of the firm. This may include seminars, demonstration etc., by expert salespersons. b) Audio-Visual Method: In order to supplement the lecturing (telling) method, training programs include the use of visual aids, such as films, slides, posters etc., and are capable of making them more interesting. c) Discussion Method: This is a good method wherein an actual case or an imaginary case is given with a specific problem to be solved, by different groups. The case or the problem may be typed or printed. Each group is asked to understand the problem and draw aSikkim Manipal University Page No. 276

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conclusion. Later, the different conclusions or suggestions are analyzed collectively, under the leadership of the instructor, in drawing generalizations from each case or problem. This type of training enables the salespersons in correcting their own views. It is suitable for a small group. It is slow and costly. d) Conference Method: Sales conferences and sales meetings are a kind of get together of all the concerned staff, weekly, fortnightly or monthly. The thoughts of various persons are pooled in the conference. Meetings or conferences have motivating effects as the participants get the opportunity for creative thinking and to express their views. To make the conference more interesting, dramas, demonstrations etc., are included. Topics like sales policies, facing competition, publicity ideas, dealings with complaints etc., are dealt with. And these will facilitate the participants in broadening their outlook and ideas. But these types of meetings or conferences are not suitable for new recruits. e) Role Playing Method: Role playing is a newly developed method. The sales trainees are made to act out roles in contrived problems. The trainer explains the situation of the problem and assigns the role of salesperson and customers with different characters to the sales trainees. Each one has to act the assigned role. The trainer watches the role played by each and discusses their weaknesses and strong points. A few may be selected to act the play, while others may watch it. Thus, the salespersons have chance to see and understand the ideas in different situations. It is not suitable for new recruits. f) Panel Method: Members in the panel group may be permanent. The members, who are experts in the panel, discuss the problems, and solutions are passed to the sales-trainee groups, who may have further discussion. This system is ineffective. g) Round Table method: It is similar to the discussion method. It consists of few members. The salespersons sit around a table along with a good discussion leader. They deal with the real-life problems faced in the industry or in the organization. Every participant takes

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part freely in discussing the problems and solutions. Exchanges of new ideas take place which may prove beneficial to the organization. h) Brain Storming Method: Under this method, more or less, similar to round table conference, persons sit around the table. The leader presents the problems for discussion. The sales trainees have to understand the problems and find the solutions. The solutions are analyzed by the leader or tested by the panel of experts. This method practically fetches no value. 2. Individual Training a) On-the-job Training: Under this method, a new salesperson is placed under an experienced or senior salesperson who trains him. First the coach explains the sales techniques under different situations. He also takes the trainee along with him on his rounds and gives him several chances to observe the dealings/interactions with the customers. Doubts of the trainee are also clarified. Then the coach along with the trainee calls on customers; the sales trainee is allowed to deal with the customer and the coach observes the performance. If any weak point or shortcoming is found in the sales trainee, they discuss how to overcome them. After some time, the sales trainee becomes a trained and independent salesperson. This system is good for traveling salespersons. b) Sales Manual: It is a compiled textbook. It contains details of the firm and products, job description, sales policies, opinions or reports required for reference purposes etc. Generally, it contains many problems with suggestive solutions. A copy of the book is given to a salesperson to go through it and understand the ideas. It works as a handy guide. c) Initial or Break-in Training: New recruits are given an orientation training so as to know about the company and its products. They may be allowed to work for some time in the firm itself to gain sufficient information about the products. After that they are sent to work in the field. Apart from the above, salespersons can also be sent to specialized educational institutions. The training cost is borne by the firm. There are many institutions in India which impart theoretical training along withSikkim Manipal University Page No. 278

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practical work. Doors are open and firms can send their new recruits for training. Correspondence courses are also available for initial training. In certain cases, one can undergo training while one is fully employed. This is suitable for salespersons who are widely scattered. There are many firms which have permanent training departments like colleges. It is important to note that even the trained or experienced salespersons need periodic training, called refresher training or follow up training. This is because of the changes in products, sales policies, changes in consumers and market, government policies, new developments, new ideas etc. 13.4.6 Evaluation of Training Having trained the salespersons, the marketing manager must evaluate the usefulness or effectiveness of training, individually and collectively on the basis of the performance of the sales personnel. Money, effort and time have been spent on training. Therefore, it is natural to expect returns. Evaluation can be made on the basis of performance of sales executive in terms of sales volume, sales profitability, order-size, expenses etc., between, before and after training periods. Aims of Training: 1. To prepare the salesperson to discharge his/her job efficiently. 2. To tell him/her what to do. 3. To guide him/her how to demonstrate. 4. To allow him/her to practice or perform it. 5. To check his/her performance. Apart from the above objectives of training, training method also includes: Motivating: In this stage, organization identifies the attributes that motivate the sales executive to perform well. Some executives may require money and others may require status or control. Here organizations draw two types of incentives. They are financial incentives and non financial incentives. In financial incentives, salary package, flexible expenses and fringe benefits serve as motivators. The non financial incentives include promotion, recognition and awards to motivate the sales executives. Evaluating: Companies are interested to know whether sales executives are achieving the quotas set for them. To know this they ask sales executives to send the different sales reports. It may be call reports,Sikkim Manipal University Page No. 279

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expense reports, loss order report, travel plan and expenditure and so on. These reports are compared against the set standards. On the basis of evaluation report, incentives are announced, and if required, sales executives are motivated and trained. Compensation: Sales executives are compensated through three methods. They are direct salary, direct commission and combined plans. In direct salary method sales executives are given fixed salary per month. In case of direct commission, sales executives will be working on commission basis only. For example, life insurance agents get straight commission. The combined method is mixture of straight salary and straight commission method. In this method sales executives are paid fixed salary and also commission on the sales they make. For example, BMTC pays its conductors fixed salary and also 2% of commission on total tickets sold in a day. Sales Quota: These are the targets set for the sales executive to achieve in a fixed period. The quota can be of different types. They are Sales quota: Here sales executives are asked to sell a particular volume. For example, the organization may ask sales executives to sell Rs 50,000 worth of goods in a year or 5000 units in a year. Expense quota: In this case, sales executives quotas are set on the basis of sales generated and a percentage of it is used for the sales expenses. For example, if sales executive X achieves Rs 1,00,000 worth of sales and his expense ratio is 5%, then he can spend Rs. 5,000 for his expenses. Profit quotas: Here emphasis is on the profit margin but not on the volume. Company would like to realize better profit. Hence, it always asks sales executives to get better margin from the sales. Activity Quota: In this method, sales executive should do multiple tasks. For example, Medical representatives meet the doctors in the morning and explain the product. They also meet the retailers where they try to push the product and induce promotional activities. In the afternoon they meet distributors and in the evening they send all the reports to company and check the order status from the head office. Combination quota: In this type of quota, any of the above five quotas can be mixed and quotas shall be set for a certain period.Page No. 280

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Self Assessment Questions 1. Medical representative work is ___________ type of sales job. 2. Work load method is used to a. Determine the sales quota b. Determine the sales territory c. Determine the sale force size d. None of the above 3. Employees are ___________ source of recruitment 4. ______________ is the first step in the selection process. 5. The full form of ACMME is _________________________________

13.5 Personal Selling Process1. Lead generation: Identification of prospects is first step in personal selling process. Organizations generate the lead through customer references, trade associations, and customer directories or through cold calling. 2. Lead evaluation: All the methods used for lead generation may not be genuine. For example, do not call registry option from telecom department, has most of the cell phone users opt for it. Customers who opted for such facility belong to middle and upper class. Hence if some executive uses cold calling there is doubt about its reliability. Marketer also should concentrate on whether the lead generated has necessary willingness, purchasing power and authority to buy. 3. Buyer analysis: Before approaching the customer, sales force should understand what products have prospects bought in the past, what products they are now using and what are their attitudes and buying habits towards the products. Sales personnel should set sales objectives and prepare draft for customer approach. 4. Approaching the customer: In this step sales person should know how to meet the prospect and what is the mode to build rapport with him/her. For example, in Japan, business meetings start in the evening. If any company sells its product in China, it should not use number 8 in their presentation. Sales executive should decide the presentation format. Please see work book for the checklist on sales presentation.Sikkim Manipal University Page No. 281

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5. Presentation and demonstration: Sales presentation starts with briefing the product, understanding the need of the customer and changing the mode of presentation according to the need of customer. The presentation should be vivid, simple and attractive. 6. Providing solutions to customer: After the presentation and product demonstration, if any queries or ambiguity exist, then sales executive should handle the questions properly with lot of attentiveness and should then solve the problems of customer. If the problem is not properly identified, then the solution may not be appropriate. 7. Order generation: This process is very important in the entire personal selling process. Sometimes sales executives are unsure about how to ask for the order. Such executives usually will not get the order. Handling customer at this stage is also very difficult. Customers may get all the information from sales executive and then show their reluctance to buy. Sales people also face unrealistic expectations from the customer. Sales executive should be smart enough to use order closing techniques.(these techniques are discussed in the workbook) 8. Follow up: Sales executives should follow up on the order generated. It will help the company to identify the customer satisfaction towards the product. It also helps them to induce the buyer to go for repeat purchase.

13.6 Direct MarketingWhen the company or organization is involved in marketing activities (usually selling products) without the use of any intervening media or channel, then it is called as Direct Marketing. The company directly sells its products to the final consumer and the consumer is expected to respond immediately or at the earliest. Direct marketing is sometimes called as B2C marketing for example, direct factory shoe sale. Following are the methods of Direct Marketing: 1. Direct mail: It is the most common method used in direct marketing, it involves sending postal mails to the consumers address and consumers maybe randomly chosen or specifically selected as targets. For example, credit card applications forms sent by banks, travel guides orSikkim Manipal University Page No. 282

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manuals sent by tour operators, free trial packs of products sent by companies, subscriptions offers for magazines etc. 2. Telephone marketing: Telephone marketing is used to sell the product directly to consumer. The growth of BPOs in India fuelled the development of telephone marketing. In the case of BPOs, two types of verticals exist. They are inbound call center and outbound call center. In case of inbound call center, customer is given a toll free number for enquiry and executives try to sell the product to such customers. In out bound call center employees call the customers and sell the products. The expansion of Indian telecommunication industry and its cheapest tariffs in the world attracted domestic sellers to use this type of channel. 3. Catalogue marketing: According to Philip Kotler, catalogue marketing is direct marketing through print, video or electronic catalogues that are mailed to select customers, made available in stores or presented online. The growth of catalogue marketing in India is in a nascent stage. The notable example in this type of marketing worldwide is J.C. Penny. 4. Kiosk marketing: Organizations spreads the information and keep ordering machines called kiosks in the shopping malls and other places. For example, Ambi Pur a perfume company recently organized a kiosk related marketing campaign in the Nirmal life style Mumbai. Company used inflatable as shown in the pictures to attract the small boys. Parents who came along with their children stopped at Kiosk and got the information from the company. The objective of campaign was to create awareness about the product among the target customers.

5. Online marketing: Marketing the organizations product on the virtual medium using the company websites as selling point or ordering point for the consumers. Sometimes companies use e-mails to offer theirSikkim Manipal University Page No. 283

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products and make a sale to the prospective consumers or even existing consumers. In this format buyers and sellers exchange the products on the internet. Organizations sell their products directly to consumers (called B2C), use trading networks or auction sites to reach new customers and serve current customers (called B2B) and encourage one customer to sell the product to the another customer (called C2C). To do business on the internet, organizations create an effective website, place the ads and promote it online, create web communities, and use e- mail. On the other side of e-Commerce, are the problems of profitability and legal/ethical issues. Self Assessment Questions 6. Customer directories are used in ____________ of personal selling. 7. Organizations which sell their products on the internet directly to consumers are called ____________. 8. J. C. Penny is famous for _________ format of direct marketing. 9. The ideal presentation should be ___________, _________ and __________. 10. In ____________ call center, employees telephone the customers and sell the products.

13.7 Summary The communication technique in which sales people build the personal relationship with customers to generate the value for the organization can be termed as personal selling. The sales force size is usually decided by the work load method. According to Philip Kotler catalogue marketing is direct marketing through print, video or electronic catalogues that are mailed to select customers, made available in stores or presented online. Organizations generate the leads through customer references, trade associations, and customer directories or through cold calling. Evaluation can be made on the basis of performance of sales executive in terms of sales volume, sales profitability, order-size, expenses etc., between, before and after training periods.Sikkim Manipal University Page No. 284

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Expansion of ACMEE is A: Aim of Training C: Content of Training, M: Method of Training, E: Execution of Training, E: Evaluation. List of Key terms: Personal selling Sales Management Sales organization Sales territory Recruitment Training Evaluation Direct marketing.

13.8 Terminal Questions1. 2. 3. 4. 5. Discuss the advantages and disadvantages of personal selling. Explain the internal and external sources of recruitment. Describe the steps involved in the selection process. Explain ACMEE with examples. Write a note on direct marketing.

13.9 AnswersAnswers to Self Assessment Questions: 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. Missionary Determine sales force size Internal Application Bank Aim, Content, Method, Execution and Evaluation. Lead generation B2C Catalogue marketing Vivid, simple and attracting Outbound

Answers to Terminal Questions: 1. Refer 13.3. 2. Refer 13.3.4.Sikkim Manipal University Page No. 285

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3. Refer 13.3.4. 4. Refer 13.3.4. 5. Refer 13.5

13.10 Mini-CaseMouth-freshener Sugandhs dilemma Sugandha Mouth Fresheners Ltd. has been a major player in the national market. Their tobacco-based product by the brand-name Khushboo, is a very popular brand and has enjoyed 50% share of the market in the last five years. Recently, they have introduced a non-tobacco mouth freshener, by the name Sugandh. This is being received well especially by the youth segment. Recently, the Govt. launched an advertising campaign asking the people to give up tobacco consumption. The company is at present, facing two major problems: a) Fear of drop in sales of tobacco-based Khushboo b) Peoples growing belief that even Sugandh contains some tobacco. The challenge for the sales force is to build awareness and educate consumers that Sugandh is a tobacco free mouth freshener. So, each salesperson is about to face this challenge and also to ensure that there is no drop in sales. Mr. Roy, the sales manager of Sughandh Ltd. is thinking about how he can train and motivate his sales force to make them ready for this challenge. Mr. Roy is also determined to know the ideas of individual sales person and how they can contribute in this situation. How do you propose to help Mr. Roy?(Source: Case modified from original simulation exercise - Cases and simulations in Marketing Management edited by Prof. M.K. Rampal and Dr. S.L. Gupta)

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