Sales ManagementPersonal Selling: Theories of Buyer-Seller Dyads

Sales management portfolioEvolution of personal selling

Classification of Personal Selling ApproachesBottoms up approach to sales management

Dyad- buyer seller interactionTheories of personal selling

Simulation models

Third Lecture

CONTENTS&

COVERAGE

Sales Management : Diversified Portfolio

1. Planning, direction and control of personal selling

2. Recruiting, training, assigning, supervising, motivating & rewarding the sales force

3. Deciding on targets, quotas, budgets, territories, servicing, etc

4. Coordination with top management, marketing team & channel members

5. Strategic decision support for the marketing team in:• Market feed back• Sales plan & targets• Product planning• Channel selection & distribution planning • Promotional plan & advertising

Personal Selling – Defined

Personal selling

refers to building

lasting professional relationship

between the

buyer and seller

IndustrialRevolution

Post-IndustrialRevolution

War andDepression

ModernEra

1800s1800s 1900s1900s 2000s2000s

Evolution of Personal Selling

Selling function became more

structured

Selling function became more

structured

Peddlers selling door to door . . . served as intermediaries

Peddlers selling door to door . . . served as intermediaries

Business organizations employed salespeopleBusiness organizations employed salespeople

Selling function became more professional

Selling function became more professional

As we begin the 21st century, selling continues to develop,becoming more professional and more relational

As we begin the 21st century, selling continues to develop,becoming more professional and more relational

Transaction-Focused vs. Relationship Focused

Transaction-FocusedTransaction-Focused Relationship-FocusedRelationship-Focused

• Short term thinking• Making the sale has

priority over most other considerations

• Interaction between buyer and seller is competitive

• Salesperson is self-interest oriented

• Long term thinking• Developing the

relationship takes priority over getting the sale

• Interaction between buyer and seller is collaborative.

• Salesperson is customer-oriented

Contributions of Personal Selling

• Salespeople help stimulate the economy

• Salespeople help with the diffusion of innovation

• Salespeople provide solutions to problems

• Salespeople provide expertise and serve as information resources

• Salespeople serve as advocates for the customer when dealing with the selling organization

Classification of Personal Selling Approaches

• Stimulus Response Selling

• Mental States Selling

• Need Satisfaction Selling

• Problem Solving Selling

Stimulus Response SellingSony vs. LG TV

Salesperson Provides

Stimuli

BuyerResponses

Sought

Continue Process until

Purchase Decision

Mental States Selling Sony vs. LG TV

Attention Interest Conviction Desire Action

Need Satisfaction Selling(Any color TV)

Uncover and Confirm

Buyer Needs

Present Offering to

Satisfy Buyer Needs

Continue Selling until

Purchase Decision

Problem Solving Selling (Any color TV)

DefineProblem

GenerateAlternativeSolutions

ContinueSelling

untilPurchaseDecision

EvaluateAlternativeSolutions

The Sales Process: Selling Foundations

In order to be successful in today’s global business environment, salespeople must have a solid relationship building foundation. They must:

Possess Excellent Communication SkillsPossess Excellent Communication Skills

Understand Buyer BehaviorUnderstand Buyer Behavior

Behave EthicallyBehave Ethically

Be TrustworthyBe Trustworthy

THE EIGHT STEPS OF THE SALES PROCESS

8. Follow-up

7. Gaining Commitment

6. Meeting objections

5. Presentation

4. Need Assessment (ascertain buyer’s needs)

3. Approach (contacts between the buyer and seller)

2. Preapproach (qualifying leads)

1. Prospecting( master list)

The Sales Process: Selling Strategy

To be successful in today’s business environment, salespeople must also think and act strategically. The must develop strategies for:

Their Sales Territories

Each Sales Call

Each Customer

Each strategy is related to the other

Sales Management: Corporate Goals (General Objectives)

Top management:Corporate Goals

Top management:Corporate Goals

Achieving targeted sales volume

Achieving targeted sales volume

Cost control &

contribution to Profits

Cost control &

contribution to Profits

Sustained future growth

Sustained future growth

Coordinated through of Marketing & Sales

Management

Coordinated through of Marketing & Sales

Management

Organizational Success: Inter Dept communication chain

Crucial Role of Sales & Marketing Dept.

Promoters/Directors

President

Vice presidentMarketing

General Manager Sales

Vice presidentsProd/Fin/HR

Sales managersRegional/product

Sales Executives/ Salesmen

Bottoms Up Approach

of

Sales Management

leads to the

realization

Organizational goals

Customeris the king

Personal Selling: DYAD

Two-way flow of communication between buyer and seller.

Buyer Seller

DYAD: Buyer-Seller Interaction

Key Factors:• Involves buyer seller interaction

•Seller motivates the customer to buy the products•Strategy may embrace persuasion, ingratiation, friendliness, etc

•Skills of the salesman (salesmanship)•Perception of customer

Sales Management: Personal selling by the salesman using the skills of salesmanship

Personal selling

Personal selling

SalesmanshipSalesmanship

Sales management

Sales management

SalesmanSalesman

Sales management

directs

personal selling efforts

which are

Implemented

through the skills of

salesmanship

Theories of personal selling (related to salesmanship)

Seller Oriented : AIDAS(Attention, Interest ,Desire, Action & Satisfaction)

Buyer orientedBehavioral oriented

First Theory: AIDAS (Attention, Interest ,Desire, Action,& Satisfaction)

Five Successive Mental States of customer:

Securing attention:

• Sales person should put the prospect( new customer) in receptive state of mind

• First few minutes of the interview are crucial & the first impression is important

• He should be skilled conversationalist, friendly and with a genuine smile

Gaining interest

• Second goal is to intensify the prospects attention into strong interest

• Explain product USP, technical features, benefits, etc

• Try and match customer’s needs with what is being offered

Kindling desire

• Third goal is to kindle the customer’s desire to ready to buy point

• Objections need answering to the prospects satisfaction

Induction of action

• If the above process is tactfully handled the customer should be ready to buy.

Building satisfaction

• After the customer has given the order, he should get the feeling of great satisfaction that the salesman has helped in making the right choice

AIDAS

is a seller oriented theory

stressingsales person controlling the

situation

Titan show room: Seller Oriented theory( AIDAS :Attention, Interest, Desire, Action &Satisfaction)

Brother buying

Gift for

sister

Seller Oriented theory

Son in law

buying

Suitings & accessories

For marriage ( father in law paying)

Second theory: Buyer Oriented theory of selling

• Buyer’s needs (or problems) receive major attention and sales person has the role in meeting buyer’s requirement and total satisfaction( find solution)

• Through interaction the sales person is expected to read psychology of the buyer facilitating his buying decision.

• Buying formula (stages of thinking process involved in buyer’s purchasing decision)

Ascertain the Need

Offer the Product…..Adequacy/pleasant feeling Trade name.... Adequacy/pleasant feeling

Purchase….

Satisfaction/ dissatisfaction

Buying habits are

influenced by the impact of

Advertisement&

person selling skillsof

sales person

Buyer Oriented Theory

Toyota Corolla New Honda City

Third theory: Behavioral equation based on stimulus response

Stimulus Response Model: Based on buying behavior & purchasing decision process

Four essential elements of the stimulus response model :

1. Drive: strong internal stimuli that impels the buyer’s response

2. Cue : This stimuli about the product may come from advertising, sales person or conversation with some friend

3 Response: What the buyer does

4. Reinforcement : Reinforces buyer‘s decision to respond

• Behavioral theory of selling

Thank you

•Start using

Sales Theories

Even when you are buying