s 1 basics of sales and distribution

Sales Management

What are the two

major functions of

a Sales Manager?

1

2Understand the interaction between Marketing and Sales

Review the major changes taking place in selling and the force causing these changes

Discuss the sales management process and the competencies required to be a successful sales manager

Describe the development of sales strategy within overall business and marketing strategy

Brand Preference

Brand Consideration

Brand Awareness

Customer Awareness

Customer Advocacy

Customer Loyalty

Purchase

Purchase Intent

3

Handoff to Sales

4GlobalisationGlobal markets

Global suppliers

Customer

ExpectationsFewer Suppliers

Increasing Power

Rising Expectations

TechnologyInternet

Mobile

Computing

CompetitionDistribution Touch points

Shorter Product Cycles

Sustainable Competitive

Advantage

Sales processSolutions Selling

Sales Teams

Sales Networks

Productivity Metrics

Transactions Relationships

Local Global

Management Leadership

Individuals Teams

Sales Revenue Customer Lifetime Value

5

Selling Skills Business Skills

Buyer Seller Preferred Business Advisor

Differentiation through Products Differentiation through People

Responsive Partnerships

Selling Solutions

6

Sales Management Effectiveness

Strategic Action

Competency

Coaching Competency

Team Building Competency

Self-Management Competency

Global Perspective Competency

Technology Competency

7

Industry trends, past and future

Actions of competition and strategic partners

Identification of attractive market segments and their buying needs

Understands how to marshal organisational resources to meet the needs of the customers

Strategic Action

Trust building in team through open and two way communication, collaboration, creativity, initiative and appropriate risk taking

Value addition through sharing of relevant selling experiencesCoaching

Proper organisation structure

Hiring the right people

Understanding individual strengths and weaknesses to foster team work

Proper rewards system

Coordinate team goals with organisation goals

Team Building

8

Integrity and ethics

Success comes from development of sales persons

Ability to gauge own areas of strengths and weaknesses

Learner and unlearner

Self Management

Aware of political, social and economic trends

Impact of global events on local markets

Ready to travel and learn languages

Adopt appropriate sales force structure

Adjust sales force competencies to local culture

Adjust own behaviour to global sales force

Global Perspective

Use to improve efficiency and effectiveness

Attitude to technology

Adapting personal style

Experience in using technology

Foster sales force acceptance and use of selling technology

Technology

9

Marketing Cost and Profitability Analysis

Evaluation of Sales People

Leading and Motivating Sales People

Compensating Sales People

Training Sales People

Recruiting and Selecting Sales People

Forecasting, Budgeting and Territorial Planning

Designing Sales Force Strategy and Structure

10

BusinessStrategy

MarketingStrategy

LEVEL 1

Top

Management

Decisions

LEVEL 3Sales ForceProgramDecisions

Account Relationship

Strategy

Go-to-MarketStrategy

Supply Chain Management (SCM)

CustomerRelationship

Management (CRM)LEVEL 2StrategyImplementationDecisions

Product DevelopmentManagement

(PDM)

11

Sales Department Objectives

Achieve sales revenue of $ 210 million. Grow contributions after sales by 25%

Marketing Objectives

Increase Product As market share by 2%. Grow contributions after sales and marketing by 20%

Business Objectives

Grow gross profit by 18% and revenue by 12%

Corporate Goals

Increase shareholder wealth by 10%

12

Major Account Objectives

Achieve sales revenue of $ 95,000 in Product A. Obtain an average gross margin of 80%

Salesperson Objectives

Achieve sales revenue of $ 1.2 million in product A. Obtain $ 0.8 million in gross margin dollars

Sales District Objectives

Achieve sales revenue of $ 10.5 million in Product A. Obtain $ 7 million contributions after direct selling

Sales Department Goals

Achieve sales revenue of $ 210 million. Grow contributions after sales by 25%

13

14

Pursue large customers

Minimize cost

Compete on price

Transaction oriented

High span of control

Incentive based compensation

Evaluation on Sales Outcome

15

Compete on non-price benefits

Provide high quality customer service

Seek long term customer relationships

Limited span of control

Salary plus incentives

Evaluation on behaviour and sales outcome

16

Serve a distinct target market not served well by others

Provide high quality customer service

Build partnerships

Flat organisation

How will customers be accessed? Go-to-market strategy?

How will new products be developed and existing products be improved?

Product Development Management

How will physical products be created and delivered to the customers?

Supply Chain Management

How will customer relations be enhanced and leveraged?

Customer Relationship Management

17

What is the best way to segment the

market?

What are the essential activities

required by each segment?

What non-face-to-face selling

methods should perform these

activities?

What face-to-face selling participants

should be used?

18

What is the customers business?Industry

Revenue

Number of employees

Sales potentialSize

Location

State level, national or internationalGeography

Key decision makers

Adoption techniques

User or non-user

Central or local purchase

Behaviour

19

Interest creation

Pre-purchase

Purchase

Post-purchase

It has to be understood that different segments will

require different efforts at different stages20

Direct Sales

Force

Agents

Distributors

Retailers

Integrators Alliances

Advertising

Promotion

Direct Mail

Tele-

marketingInternet

Direct Indirect

Non-Sales Force OptionsSales Force Options

Company

Customers and Prospects

Examples of Integrators and Alliances

21

Advertising

Direct Mail

Internet

Telemarketing

Sales Force

Effectiveness

Efficiency

High Salesper Exposure

Low Costper Exposure

22

Identify customer needs for better solutions

Discovering and designing new product solutions

Developing new solution prototypes

Managing internal departmental priorities and involvement

Designing activities to speed-up development process

Launching new and redesigned offerings

Change in organisation structure

Sales quota changes

Training of field force

Changes in incentives and awards

Impact on Sales Department

23

Selecting and managing supplier relationships

Managing inbound, internal and outbound logistics

Designing product assembly and batch manufacturing

Managing process technology

Order, pricing, and terms management

Managing channel partners

Managing product installation and maintenance

Knowledge of the entire upstream and downstream supply chain

Thinking strategically about partnering with the channels

Establishing good internal and external lines of communication and influence

Implications on the evolution of the sales force

24

Identifying high value prospects

Learning about product usage and application

Developing and executing advertising and promotion programs

Developing and executing sales programs

Developing and executing customer service programs

Acquiring and leveraging customer contact information systems

Managing customer contact teams

Enhancing trust and customer loyalty

Cross-selling and upselling of offerings

25

27

Create new

value through

sales offer

Create new

value through

sales offer

Lessen cost

and effort of

acquisition

INCREASE

BENEFITS

REDUCE

COSTS

Extrinsic Value Customers

(buying beyond product value)

Strategic Value Customers

(leveraging suppliers enterprise competencies)

Intrinsic Value Customers

(buying on product value alone)

28

Intrinsic Value

Buyers

Enterprise Selling

Consultative

Selling

Transactional

Selling

Extrinsic Value

Buyers

Strategic Value

Buyers

VALUE = BENEFITS -COSTS

a cheaper no hassle pie

a bigger pie

a balanced diet

29

Source: Andris Zoltners, Prabhakant Sinha and Sally E Lorrimer, Match your Sales Force to your Business Cycle HBR August 2006

Distribution ChannelPPT 1-4

35

MA

NU

FA

CT

UR

ER

S

WH

OL

ES

AL

ER

S

RE

TA

ILE

RS

CO

NS

UM

ER

S

Physical PhysicalPhysical

Possession Possession Possession

NegotiationNegotiation

Promotion

Negotiation

FinancingFinancing

Risking Risking

Financing

Ordering Ordering

Risking

Ordering

Payment Payment Payment

Ownership

Promotion Promotion

OwnershipOwnership

38

M A N U F A C T U R E R S

C O N S U M E R S

Distributors

Wholesalers

Retailers

Wholesalers

Retailers Retailers

Ze

ro L

eve

l

On

e L

eve

l

Tw

o L

eve

ls

Th

ree

Le

ve

ls

Number of levels depends on type of product and geographical spread

By ownership

Single unit

Chain stores

Company run stores

Government operated stores

Merchandise handled

General merchandise

Single line

Specialty stores

Method of customer contact

Bricks and mortar

Catalogue

Internet

Household contacts

Location

Urban

Rural

Roadside

44

46

Distribute through as many outlets as possible

Low involvement products where convenience is most important

Normally for FMCG and fast moving electrical items

Intensive

Normally for consumer durablesSelective

Used when producers want to retain control over the quality of service levels

Relationship oriented

LG, Samsung, Benetton

Exclusive

Transportation Firms

Storage FirmsAdvertising

Agencies

Financial Firms

Insurance Firms

Marketing Research

Firms

47

Wh

at

wo

uld

be

the

dif

fere

nce

bet

wee

n:

Industrial Selling

Channel Selling

Services Selling

49

s 1 basics of sales and distribution

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