SALES

MANAGEMENT
AND
SALESMANSHIP
PHILIP KOTLER
 GURU OF
MARKETING
 C. K
PRAH LAD
 RENOWNED MANAGEMENT GURU
 STUDIED IN HARVARD AND
 IIM A.
 WAS PROF AT UNIVERSITY OF
MICHIGAN.
 AUTHORED MGMT BEST SELLERS
LIKE:
ØThe Core Competenceof the
Corporation
ØThe Future of Competition
ØThe Fortune at the Bottom of
the Pyramid.
ØThe New Age of Innovation
PETER DRUCKER
 MANAGEMENT GURU
AIDAS
A-ATTENTION

I-INTEREST

D-DESIRE

A- ACTION

S- SATISFACTION
FGF
FEEL GOOD FACTOR
USP
vUNIQUE SELLING
PROPOSITION
vCONCEPT BY
ROSSER REEVES
vTED BATES AGENCY
vCOPY WRITER
POP
POINT OF PURCHASE

STP ANALYSIS
vS- SEGMENTING.
vT- TARGETING.
vP- POSITIONING
 (STP ANALYSIS)
a) SEGMENTATION
NICHE SEGMENT

INDIVIDUALS

b) TARGETING: WHO ARE MY CUSTOMERS?

c) POSITIONING: WHAT IS MY MAIN SELLING POINT?

SWOT
STRENGTH.
WEAKNESS.

OPPORTUNITY.

THREATS
OPINION LEADER
 AN INDIVIDUAL WHO:
vIS A PUBLIC FIGURE.
vHAS INTENSIVE
KNOELEDGE IN THE
RELEVANT FIELD.
vVERY ARTICULATE.
CAVEAT EMPTOR
BUYER BEWARE

QUID PRO QUO
 MUTUAL
RECIPROCITY
DINKS
 DOUBLE
INCOME NO
KIDS
INNOVATION ADOPTION
MODEL

vA-AWARENESS.
vI- INTEREST.
vE- EVALUATION.
vT-TRIAL
vA-ADOPTION
UEV
vUNIQUE
EMOTIONAL
VALUE
MARKETING MYOPIA

BEING SHORT
SIGHTED
MARKETING TRIANGLE
CUSTOMERS

COMPANY COMPETITION
23
 CORE CONCEPTS OF MARKETING

Needs, wants UTILITY, VALUE &

PRODUCTS SATISFACTION
DEMANDS

EXCHANGE, TRANSACTION
MARKETS MARKETING &
RELATIONSHIPS
MARKETERS

24
DEFINITION
 MARKETINGMIX" IS A
GENERAL PHRASE USED TO
DESCRIBE THE DIFFERENT
KINDS OF CHOICES
ORGANIZATIONS HAVE TO
MAKE IN THE WHOLE
PROCESS OF BRINGING A
PRODUCT OR SERVICE TO
MARKET.

MARKETING MIX
v4 P’S
vCONCEPT BY
 E.JEROME MC CARTHY
vPRODUCT
vPRICE
vPLACE
vPROMOTION

PRODUCT/SERVICE
ANYTHING THAT CAN BE OFFERED TO

A MARKET FOR ATTENTION,
ACQUISITION OR CONSUMPTION
WHICH INCLUDES PHYSICAL
OBJECTS,
SERVICES,PERSONALITIES,
ORGANISATIONS AND DESIRES.


PRICE


 THISIS THE AMOUNT

FOR WHICH A PRODUCT
A SERVICE OR AN IDEA
IS OFFERED FOR SALE
REGARDLESS OF ITS
WORTH OR VALUE TO
THE POTENTIAL
PURCHASER.
PLACE
 ALSOKNOWN AS CHANNELS
OF DISTRIBUTION.IT IS A
SERIES OF INDEPENDENT
ORGANISATIONS INVOLVED
IN THE PROCESS OF MAKING
A PRODUCT OR SERVICE
AVAILABLE FOR
CONSUMPTION.
PROMOTION

 THE SET OF TOOLS

WHICH AIMS AT
CREATING AWARENESS,
GIVING INFORMATION
AND AIDS IN
RETENTION OR RECALL
REGARDING ANY
PRODUCT OR SERVICE.
PEOPLE
vTHE HUMAN
RESOURCE IN THE
ORGANISATION.
vTHE MOST
IMPORTANT
ASSET
PROCESS
v THIS MEANS PROCEDURES,
MECHANISM AND FLOW OF
ACTIVITIES BY WHICH A SERVICE IS
ACQUIRED.
vPROCESS DECISIONS RADICALLY
AFFECT HOW A SERVICE IS
DELIVERED TO CUSTOMERS.
vTHE SERVICE INCLUDES SEVERAL
PROCESSES E.G. FIRST CONTACT
WITH CUSTOMERS,
vADMINISTRATIVE PROCEDURE
REGARDING COURSE DELIVERY,
vPREPARATION,
vDELIVERY AND EVALUATION OF THE
COURSES.
PHYSICAL
EVIDENCE
v THIS IS THE ENVIRONMENT IN
WHICH THE SERVICE IS DELIVERED
AND ANY TANGIBLE GOODS THAT
FACILITATE THE PERFORMANCE AND
COMMUNICATION OF THE SERVICE.
v CUSTOMERS LOOK FOR CLUES TO
THE LIKELY QUALITY OF A SERVICE
ALSO BY INSPECTING THE TANGIBLE
EVIDENCE.
vFOR EXAMPLE, PROSPECTIVE
CUSTOMERS MAY LOOK TO THE
DESIGN OF LEARNING MATERIALS,
THE APPEARANCE OF FACILITIES,
STAFF, ETC.

7 O FRAMEWORK
vOCCUPANTS
 WHO CONSTITUTES THE
MARKET.
vOBJECTS
 WHAT DOES THE MARKET
BUY
 vOBJECTIVES
 WHY DOES THE
MARKET BUY.
vORGANIZATION
 WHO PARTICIPATES
IN THE BUYING.
vOPERATIONS
 HOW DOES THE
MARKET BUY.

 vOCCASION
 WHEN DOES
THE MARKET
BUY.
vOUTLET
 WHERE DOES
THE MARKET
7 C’S
MODEL
CONSUMER
vCONSUMER IS A
BROAD LABEL FOR
ANY INDIVIDUALS
OR HOUSEHOLDS
v THAT USE
GOODSAND
SERVICES
GENERATED
COMMODITY
A COMMODITY IS A
GOOD FOR WHICH
THERE IS DEMAND,
BUT WHICH IS
SUPPLIED WITHOUT
QUALITATIVE
DIFFERENTIATION
COST
vA COST IS THE VALUE OF
MONEY THAT HAS BEEN
USED UP TO PRODUCE
SOMETHING,
vIT INCLUDES PRODUCING
COST,
vSELLING COST,
vPURCHASING COST AND
vSOCIAL COST.
CHANNELS
vFLOW OF
COMMODITY .
MARKETING
CHANNELS.
vALSO KNOWN AS
LOGISTICS
MANAGEMENT.
COMMUNICATI
ON
v COMMUNICATION WHICH
REPRESENTS A BROADER
FOCUS THAN SIMPLY
PROMOTIONS.
vCOMMUNICATIONS CAN
INCLUDE ADVERTISING,
PUBLIC RELATIONS,
PERSONAL SELLING, VIRAL
ADVERTISING, AND
vANY FORM OF
COMMUNICATION BETWEEN
CONVENIENCE
 CONVENIENCE TAKES INTO
ACCOUNT THE EASE OF
BUYING THE PRODUCT,
FINDING THE PRODUCT,
FINDING INFORMATION
ABOUT THE PRODUCT, AND
SEVERAL OTHER FACTORS
CIRCUMSTANCE
vTHERE ARE
VARIOUS
UNCONTROLLABLE
EXTERNAL
ENVIRONMENTAL
FACTORS
ENCIRCLING THE
COMPANIES.
 The 4 Ps & 4Cs
MARKE
CONVENIENCE
TING
MIX
PRODUC PLACE
T

CUSTOMER
PROMOT
SOLUTION PRICE
ION

COMMUNICATION
CUSTOMER
COST
46
COGNITIVE
DISSOSANCE
vCONCEPT BY LEON
FESTINGER.
vCOGNITIVE IMPLIES
THINKING AND
DISSONANCE IMPLIES
DISTURBANCE.
vWHEN THE CONSUMERS
A GAP BETWEEN
REALITY AND
MARKETERS
MUST
UNDERPROM
ISE AND
OVER
DECISION MAKING

CHOICE


BETWEEN
ALTERNATIVES
PEST ANALYSIS
vPOLITICAL FACTORS
vECONOMIC FACTORS
vSOCIO CULTURAL
FACTORS
vTECHNOLOGICAL
FACTORS

WHAT IS PEST ANALYSIS?

vTHIS ANALYSIS IS
ESSENTIAL FOR AN
ORGANIZATION BEFORE
BEGINNING ITS
MARKETING PROCESS
vCONSISTS OF INTERNAL
ENVIRONMENT AND
EXTERNAL ENVIRONMENT

 EXTERNAL MARKETING
ENVIRONMENT
External Environment
Social
Social Ever-Changing
Ever-Changing
is not controllable Change
Change Marketplace
Marketplace
Demogra
Demogra
phics
phics

Product Economic
Economic
Product Physical / Natural Condition
Distributi
Distributi Condition
on ss
on
Promotio
Promotio
nn
Price
Price Competiti
Competiti
on
on Target Market
Political
Political&&
Legal
Legal
Technolo Factors
Factors
Technolo
Environmental gy
gy
Scanning
FATHER OF CB
 LEON.
 G.
SCHIFFMA
N
BCG
MATRIX
 ØBOSTON CONSULTING GROUP (BCG)
MATRIX WAS DEVELOPED BY
BRUCE HENDERSON OF THE
BOSTON CONSULTING GROUP IN THE
EARLY 1970’S.


ØACCORDING TO THIS
TECHNIQUE, BUSINESSES OR
PRODUCTS ARE CLASSIFIED AS
LOW OR HIGH PERFORMERS
DEPENDING UPON THEIR
MARKET GROWTH RATE AND
RELATIVE MARKET SHARE.
STARS
HIGH GROWTH, HIGH MARKET SHARE

 STARS ARE LEADERS IN BUSINESS.

 THEY ALSO REQUIRE HEAVY
INVESTMENT, TO MAINTAIN ITS
LARGE MARKET SHARE.
 IT LEADS TO LARGE AMOUNT OF
CASH CONSUMPTION AND CASH
GENERATION.
 ATTEMPTS SHOULD BE MADE TO
HOLD THE MARKET SHARE
OTHERWISE THE STAR WILL
BECOME A CASH COW.
CASH COWS
vLOW GROWTH , HIGH MARKET SHARE
v THEY ARE FOUNDATION OF THE
COMPANY AND OFTEN THE STARS OF
YESTERDAY.
vTHEY GENERATE MORE CASH THAN
REQUIRED.
vTHEY EXTRACT THE PROFITS BY
INVESTING AS LITTLE CASH AS POSSIBLE
vTHEY ARE LOCATED IN AN INDUSTRY THAT
IS MATURE, NOT GROWING OR
DECLINING.




DOGS
LOW GROWTH, LOW MARKET SHARE
vDOGS ARE THE CASH
TRAPS.
vDOGS DO NOT HAVE
POTENTIAL TO BRING IN
MUCH CASH.
vNUMBER OF DOGS IN THE
COMPANY SHOULD BE
MINIMIZED.
vBUSINESS IS SITUATED AT
 WH AT IS SALES
MANAGEMENT?
vSALES MANAGEMENT IS THE
ATTAINMENT OF SALES FORCE GOALS IN
AN EFFECTIVE AND EFFICIENT MANNER
THROUGH:
•PLANNING
•STAFFING
•TRAINING
•LEADING
•CONTROLLING ORGANIZATIONAL
RESOURCES
  SALES MANAGEMENT OF
ALL MARKETING
ACTIVITIES INCLUDING:
  
 ADVERTISING;
 SALES PROMOTION;
 MARKETING RESEARCH;
 PHYSICAL DISTRIBUTION;
 PRICING AND
 PRODUCT
MERCHANDISING
 DIFFERENCE BETWEEN -
SALES & MARKETING ?
vSALES
vTRYING TO GET THE CUSTOMER
TO WANT WHAT THE COMPANY
PRODUCES
vMARKETING
vTRYING TO GET THE COMPANY
PRODUCE WHAT THE
CUSTOMER WANTS
62
SALES CONCEPT
vSTARTING POINT
vFACTORY
vFOCUS-
vPRODUCT.
vMEANS-
vSELLING TACTICS.
vAIM-
vPROFIT.
MARKETING CONCEPT
vSTARTING POINT
vCUSTOMER NEEDS
vFOCUS-
vCUSTOMER SATISFACTION
vMEANS-
vINTEGRATED MARKETING.
vAIM-
vBRAND LOYALTY
 SALES
M AN AGEM EN T
FUN CTION S
PLAN N IN
G
TH E CON SCIOUS, SYSTEM IC
PROCESS OF M AKIN G
D ECISION S ABOUT GOALS
AN D ACTIV ITIES TH AT AN
IN D IV ID UAL, GROUP, W ORK
UN IT, OR ORGAN IZ ATION
W ILL PURSUE IN TH E
FUTURE AN D TH E USE OF
RESOURCES N EED ED TO
SALES M AN AGEM EN T FUN CTION S
STAFFI
NG
vACTIV ITIES
UN D ERTAKEN TO
ATTRACT, D EV ELOP,
AN D M AIN TAIN
EFFECTIV E SALES
PERSON N EL W ITH IN
SALES MANAGEMENT FUNCTIONS
SALES
TRAINING
vTHE EFFORT PUT FORTH
BY AN EMPLOYER TO
PROVIDE THE
SALESPERSON JOB-
RELATED CULTURE, SKILLS,
KNOWLEDGE, AND
ATTITUDES THAT RESULT IN
IMPROVED PERFORMANCE
SALES MANAGEMENT FUNCTIONS
LEADING

vTHE ABILITY TO
INFLUENCE OTHER
PEOPLE TOWARD
THE ATTAINMENT
OF OBJECTIVES.
SALES MANAGEMENT FUNCTIONS
CONTROLLING

vMONITORING SALES
PERSONNEL’S ACTIVITIES,
DETERMINING WHETHER
THE ORGANIZATION IS ON
TARGET TOWARD ITS
GOALS, AND MAKING
CORRECTIONS AS
NECESSARY.
SALES MANAGEMENT FUNCTIONS
 SALES
PERFORMANCE
SALES MANAGEMENT IS
THE ATTAINMENT OF
SALES GOALS IN AN
ETHICAL, EFFICIENT, AND
EFFECTIVE MANNER.
 EXTERNAL
ENVIRONMENT
 REASONS FOR THE
DEVELOPMENT OF THE
FIELD OF SALES
vCHOICE.
vEXCESSIVE
COMPETITION.
vPSYCHOGRAPHICS.
vINCREASED
AWARENESS.
vDINKS

 ORGANIZATION IS A SOCIAL
SYSTEM THAT IS GOAL DIRECTED
AND HAS A DELIBERATED
STRUCTURE.
GOAL DIRECTED MEANS AN
ORGANIZATION IS DESIGNED TO
ACHIEVE SOME OUTCOME.
SOCIAL MEANS BEING MADE UP OF
TWO OR MORE PEOPLE.

DELIBERATED STRUCTURE MEANS THE

TASKS ARE DIVIDED, AND THE
RESPONSIBILITY FOR THEIR
PERFORMANCE IS ASSIGNED TO
ORGANIZATION MEMBERS.
 MAJOR PARTS OF AN
ORGANIZATIONAL SYSTEM
ORGANIZATIONAL EFFECTIVENESS
IS THE DEGREE TO WHICH THE
ORGANIZATION ACHIEVES A STATED
OBJECTIVE.
ORGANIZATIONAL EFFICIENCY
REFERS TO THE AMOUNT OF
RESOURCES USED TO ACHIEVE AN
ORGANIZATIONAL GOAL.
SALES LEADER LEVELS IN THE
ORGANIZATIONAL HIERARCHY
CEO

President
T o p S a l e s L e
( S t r a t e g i c )

Vice President of
Marketing

National Sales Leader

M i d d l e S
Zone Sales Leader L e a d e r
( T a c t i c a
Regional Sales Leader

F i r s t - L
District Sales Leader S a l e s L
Assistant District Sales Leader ( O p e r

Nonmanagerial Salespeople
Sales Trainee Salesperson Key Account
PERENTAGE OF TIME SPENT ON FUNCTIONAL
ACTIVITIES BY ORGANIZATIONAL LEVEL
Top Managers

P l a n n i n g S t a fT f ri na i g n -
L e a d i n g C o n t r o
i n g
3 5 % 1 0 %5 % 3 0 % 2 0 %

Middle Managers
P l a n n i n S g t a f T f ir n a gi n i n gL e a d i n g C o n t r o l l i
2 8 % 1 0 % 1 0 % 3 0 % 2 2 %

First-Line Managers
P l a n n i Sn t g a f f i n g T r a i n i n gL e a d i n gC o n t r o l
1 5 % 2 0 % 2 5 % 2 5 % 1 5 %
 SALES MANAGEMENT
DECISION AREAS
üSET OBJECTIVES
üDETERMINE üSELECT
SALES FORCE TERRITORIES,
PLANNING ORGANIZING üRECRUITING
SIZE
üSELECTING

CUSTOMER
NEEDS/WANTS
üTraining &
üEvaluate üdevelop
& control

CONTROLLING DIRECTING
üMOTIVATE üCOMPENSATION
 OBJECTIVES OF SALES
MANAGEMENT

vCONTRIBUTION
TO PROFITS;
vCONTINUING
GROWTH AND
EXPANSION
vSALES VOLUME
SALES FORCE
MANAGEMENT
• ESTABLISHING SALES FORCE OBJECTIVES
– SALES
VOLUME
– MARKET
SHARE
– PROFIT
• DETERMINING SALES FORCE SIZE

Vs.
ROLEOF A
SALES
EXECUTIVE
vGOAL SETTING;
vESTIMATING, MARKETING AND SALES
POTENTIAL;
vGUIDING THE SALES FORCE PERSONNEL;
vCOORDINATING VARIOUS ACTIVITIES LIKE
PLANNING, OPERATION AND ASSURING
THAT SALES DEPARTMENT FUNCTIONS
SMOOTHLY;
vGAINING PRODUCT DISTRIBUTION,
OBTAINING DEALER IDENTIFICATION,
RECONCILING BUSINESS GOALS AND
SHARING PROMOTIONAL RISKS;
vIMPLEMENTATION OF OVERALL MARKETING
STRATEGY;
vSUCCESSFUL MARKET INTRODUCTION OF A
NEW BRAND;
vENSURING THAT THERE IS AN EFFECTIVE
CONTROL AND CONTROLLING SITUATION;
vRECRUITING, SELECTING AND TRAINING
SALES PERSONNEL
SALES MANAGEMENT
SKILLS
vCOMMUNICATION SKILLS.
vPERSONA
vKNOWLEDGE OF ONES COMPANY N
PRODUCT PORTFOLIO.
vKNOWLEDGE OF COMPETITORS
PRODUCTS.
vPEOPLE SKILLS.
vPATIENCE.
vNO EGO
vCONCEPTUAL AND DECISION SKILLS
vTECHNICAL SKILLS
 PROMOTION FROM
SALESPERSON TO SALES
MANAGER
vCHANGES THAT OCCUR WHEN A
PERSON BECOMES A NEW MANAGER:
1.PERSPECTIVES CHANGE
2.GOALS CHANGE
3.RESPONSIBILITIES CHANGE
4.SATISFACTION CHANGES
5.JOB SKILL REQUIREMENTS
CHANGE
6.RELATIONSHIPS CHANGE
RELATIONSHIP OF CONCEPTUAL AND DECISION, PEOPLE,
AND TECHNICAL SKILLS TO SALES LEADER LEVEL

C o n
c e P p e t ou paT l l e e a c nSh
D e c i s i o n S k i l l s

T o p S a l e s L e a d e r s

M i d d l e S a l e s L e a d e r s

F i r s t - L i n e S a l e s L e a d e r

N o n m a n a g e r i a l S a l e s p e
THE PROMOTION
EXPERIENCE
PHASE ONE – IMMOBILIZATION
PHASE TWO – MINIMIZATION OR DENIAL
OF CHANGE
PHASE THREE – DEPRESSION
PHASE FOUR – ACCEPTANCE OF
REALITY
PHASE FIVE – TESTING
PHASE SIX – SEARCHING FOR
MEANINGS
PHASE SEVEN – INTERNALIZATION
PROBLEMS NEW MANAGERS
EXPERIENCE
vLACK OF PREPARATION FOR
THE JOB.
vEXPECTED TO STEP INTO
THE JOB AND IMMEDIATELY
FUNCTION EFFECTIVELY.
vOFTEN LACKS AN
IMMEDIATE PEER GROUP.
MAKING A SUCCESSFUL
TRANSITION TO
MANAGEMENT
•HAVE A LEARNING ATTITUDE
–A WILLINGNESS TO
LEARN, CHANGE, ADAPT,
AND SEEK HELP WHEN
NEEDED.
•HAVING REALISTIC
EXPECTATIONS.
•LEAVE THE OLD JOB BEHIND.
 THE BOTTOM LINE
SKILLED SALES MANAGERS ARE THE KEY TO
A SUCCESSFUL ORGANIZATION.
SALES MANAGERS HAVE FIVE FUNCTIONS
THAT, WHEN COMBINED, CAN ALLOW THEM
TO ACHIEVE THE GOALS DESIRED BY
HIGHER LEVELS OF MANAGEMENT.
THE VARIOUS TYPES OF SALES MANAGERS
CAN BE BROKEN DOWN INTO THE
CATEGORIES OF VERTICAL AND
HORIZONTAL.
MOST CORPORATIONS HIRE A PERSON WHO
 KEY DECISION AREAS IN
SALES MANAGEMENT RELEVANT TO
STRATEGY FORMULATION
 DECIDING UPON TYPE
AND QUALITY OF
 COMPENSATION
SALES PERSONNEL OF SALES FORCE
REQUIRED  PERFORMANCE
 DETERMINATION OF APPRAISAL
THE SIZE OF THE  FEEDBACK
SALES FORCE MECHANISM
 ORGANIZATION AND  MANAGING
DESIGN OF THE CHANNEL
SALES DEPARTMENT RELATIONSHIP
 TERRITORY DESIGN  COORDINATION
 RECRUITMENT & WITH OTHER
TRAINING
PROCEDURES MARKETING
DEPARTMENT
 TASK ALLOCATION
 A KEY TO SUCCESS


 STAY CLOSE
TO YOUR
CUSTOMER
 AND

 LISTEN!
THEORIES OF SELLING


SELLING & BUYING
STYLES



FACTORS OF BUYING STYLES
 BUYER’S CAPACITY TO PAY
 THE QUANTITY OF PURCHASE
THE ABILITY TO TAKE RISK
THE BARGAINING POWER OF BUYER
PERSONALITY TRAITS

IN N OVATORS &
LAGGARD S
 1.AIDAS
THEORY

THIS THEORY IS BASED ON THE PREMISE THAT DURING A SALES
PRESENTATION, THE PROSPECT CONSCIOUSLY GOES THROUGH FIVE
DIFFERENT STAGES: ATTENTION, INTEREST, DESIRE, ACTION AND
SATISFACTION.
v ATTENTION: THE SALESPERSON SHOULD ATTRACT THE PROSPECT
TO HIS PRESENTATION BEFORE HE ACTUALLY GOES INTO THE DETAILS
OF THE SAME.
v INTEREST: HE/SHE SHOULD MAINTAIN THE INTEREST OF THE
PROSPECTS THROUGHOUT THE PRESENTATION.
v DESIRE: THE NEXT STEP IN THE SALES PROCESS, AS PER THE
AIDAS THEORY, IS TO CREATE A STRONG DESIRE IN THE PROSPECT’S
MIND TO PURCHASE HIS PRODUCT.
v ACTION: ONCE THE SALESPERSON HAS BEEN SUCCESSFUL IN
TAKING HIS PROSPECT THROUGH THE THREE STAGES, AS DISCUSSED
ABOVE, HE SHOULD INDUCE THE PROSPECTS INTO ACTUALLY
BUYING THE PRODUCT.

.
 2.RIGHT SET OF
CIRCUMSTANCES
v
THEORY
THE ADVOCATES OF THIS
THEORY DEFINE THAT ALL THE
CIRCUMSTANCES, WHICH LED TO
THE SALES WERE APPROPRIATE
FOR THE SALES TO HAVE TAKEN
PLACE.
vIN OTHER WORDS, IF THE SALES
PERSON IS SUCCESSFUL IN
SECURING THE PROSPECT’S
ATTENTION,
vMAINTAINING HIS INTEREST AND
INDUCING HIS DESIRE TO BUY THE
PRODUCT, THE SALES WILL RESULT.
vMOREOVER, IF THE SALES PERSON
IS HIGHLY SKILLED, HE WILL TAKE
CONTROL OF THE PRESENTATION,
WHICH WOULD LEAD TO SALES.
3.BUYING FORMULA THEORY


vTHIS THEORY EMPHASIZES ON THE NEEDS

OR PROBLEMS OF THE BUYER.
vTHE SALES PERSON ASSIST THE BUYER IN
FINDING AN APPROPRIATE SOLUTION TO
THE PROBLEM.
vTHIS SOLUTION MAY BE IN TERMS OF A
PRODUCT OR SERVICE.
vTHIS THEORY IS BASED ON THE ANALYSIS OF
THE SEQUENCE OF EVENTS THAT GOES IN
THE BUYER’S MIND DURING THE SALES
PRESENTATION.
vTHE THEORY IS BASED ON THE
PRESUMPTION THAT THE SALES PERSON
WILL TAKE CARE OF THE EXTERNAL
FACTORS.
vTHE SEQUENCE OF EVENTS IN A PROSPECT’S MIND CAN BE
REPRESENTED AS
vTHERE ARE ALL THE CHANCES THAT A CONTINUOUS RELATIONSHIP
WILL DEVELOP BETWEEN THE PROSPECT AND THE SALESPERSON. AS A
RESULT OF SALES, THE SATISFACTION WILL ALSO COME IN THE
SEQUENCE. THIS SEQUENCE CAN BE PRESENTED AS

NEED SOLUTION PURCHASE

NEED SOLUTION PURCHASE SATISFACTION

 4.BEHAVIORAL EQUATION THEORY:
 
 THIS THEORY WAS PROPAGATED
BY
 TA HOWARD WHO OPINED THAT
BUYING BEHAVIOR CONSISTS OF
FOUR BASIC ELEMENTS: 
 DRIVE;
 CUE;
 RESPONSE;
 RE-INFORCEMENT

 BUYER SELLER DYAD
 DYAD IS ESSENTIALLY A
SITUATION WHERE
TWO PEOPLE
INTERACT AND REACT.
 ANY SALESPERSON AND
HIS PROSPECTIVE
CUSTOMER
INTERACTING WITH
EACH OTHER IS
KNOWN AS BUYER-
SELLER DYAD
 FACTORS INFLUENCING
BUYER-SELLER DYADIC
INTERACTIONS
 BUYERS INITIAL CONDITIONING
WITH RESPECT TO SELLING;
 BUYERS KNOWLEDGE ABOUT THE
PRODUCT;
 PERSONAL CHARACTERISTICS
LIKE PERSONALITY, VALUES,
ATTITUDE, PAST EXPERIENCES;
 PERCEPTION OF THE BUYER.

CONCEPTUAL
MODEL OF THE
BUYER SELLER
DYADIC
RELATIONSHIP
FORECAST
PREDICTING THE
FUTURE
FORECASTING IS THE
ESTABLISHMENT OF
FUTURE EXPECTATIONS
BY THE ANALYSIS OF
PAST DATA, OR THE
FORMATION OF
 WHAT IS A SALES FORECAST?

LEVEL OF SALES A SINGLE

ORGANIZATION EXPECTS TO ACHIEVE

BASED ON

vCHOSEN MARKET STRATEGY

v COMPETITIVE ENVIRONMENT.

111
v“ IT IS AN ESTIM ATE OF
SALES
vIN PH YSICAL UN ITS
vFOR A FUTURE PERIOD
vUN D ER A PARTICULAR
M ARKETIN G PROGRAM AM E
vAN ASSUM ED SET OF
ECON OM IC AN D OTH ER
FACTORS
vA SALES FORECAST M AY
BE FOR A SIN GLE PROD UCT
vOR FOR AN EN TIRE
PROD UCT LIN E. ”

112
SALES FORECASTING - WHY
IS IT NECESSARY?
 TO RAISE THE NECESSARY
CASH FOR INVESTMENT AND
OPERATIONS
 TO ESTABLISH CAPACITY AND
OUTPUT LEVELS
 TO ACQUIRE AND STOCK THE
RIGHT AMOUNT OF
SUPPLIES
 TO HIRE THE REQUIRED
NUMBER OF PEOPLE
COMPANY SALES FORECAST
EXPECTED LEVEL OF
COMPANY SALES
BASED ON A CHOSEN
MARKETING PLAN AND
AN ASSUMED
MARKETING
ENVIRONMENT.
FORECASTED SALES REFLECT…
1.THE SIZE OF THE TARGET MARKET
2.THE MARKETING MIX CHOSEN FOR THE
TARGET MARKET
3.THE ASSUMED NUMBER OF COMPETITORS
AND COMPETITIVE INTENSITY IN THE
TARGET MARKET

115
MAKING A SALES FORECAST
SALES FORECAST IS A FUNCTION OF:
1.MARKET POTENTIAL (M)
2.PROPORTION OF MARKET YOU ARE TARGETING (T)
3.EXTENT OF MARKET COVERAGE (C)
4.NUMBER OF UNITS EXPECTED TO SELL PER
CUSTOMER DURING THE YEAR (U)
5.AVERAGE PRICE PER UNIT (P)

SALES FORECAST = M X T X C X U X P
116
 FORECASTING ROUTES
TOP-DOWN
WHERE INTERNATIONAL AND NATIONAL
EVENTS AFFECT THE FUTURE BEHAVIOUR
OF LOCAL VARIABLES.

117
BOTTOM-UP

WHERE LOCAL EVENTS AFFECT

THE FUTURE BEHAVIOUR OF
LOCAL VARIABLES.
118
MARKET TARGETING
SPECIFYING SEGMENTS TO PURSUE

ORGANIZATION

DIFFERENTIATED
MARKETING
THE ORGANIZATION
PURSUES SEVERAL
DIFFERENT MARKET
SEGMENTS
SIMULTANEOUSLY

MARKET
119
MARKET TARGETING
SPECIFYING SEGMENTS TO PURSUE

ORGANIZATION
CONCENTRATED
MARKETING

THE ORGANIZATION
FOCUSES ON A SINGLE
MARKET SEGMENT

MARKET
120
METHODS OF SALES
FORECAST:

A.) QUALITATIVE
METHODS:

JURY OF EXECUTIVE
OPINION:


A PANEL OF HIGH RANKING

SALES EXECUTIVES ARE
CONSTITUTED.
 HIGH RANKING EXECUTIVES
ESTIMATE PROBABLE SALES;
 AN AVERAGE ESTIMATE IS
CALCULATED
 DELPHI TECHNIQUE
 THIS TECHNIQUE WAS DEVELOPED BY
RESEARCHERS AT RAND
CORPORATION FOR PREDICTING THE
FUTURE SALES.
 HERE A PANEL OF EXPERTS IS
APPOINTED.
 THEY RESPOND TO A SERIES OF
QUESTIONNAIRES
 THE FEEDBACK IS CONSOLIDATED AND
IS USED TO PREPARE THE NEXT
QUESTIONNAIRE.
 THIS PROCESS S REPEATED TILL A
CONSENSUS IS REACHED
 THIS MAKES SURE THAT ANY PROBLEM
POLLOF SALES FORCE
OPINION
 ALSO KNOWN AS GRASS-ROOT
APPROACH
 IN THIS METHOD INDIVIDUAL
SALES PERSONNEL FORECAST
SALES FOR THEIR OWN
TERRITORIES
 THEN INDIVIDUAL SALES
FORECASTS ARE COMBINED AND
MODIFIED AS MANAGEMENT
THINKS NECESSARY TO FORM A
COMPREHENSIVE COMPANY
PROJECTION OF PAST
SALES
THISIS ESSENTIALLY
BASED ON THE PAST
SALES FIGURES AND
THE CUSTOMERS
TRENDS, TASTES AND
PREFERENCES.

SURVEY OF CUSTOMERS’
BUYING PLANS:
 THIS TECHNIQUE
INVOLVES ASKING
QUESTIONS TO VARIOUS
CUSTOMERS REGARDING
THEIR BUYING HABITS AS
WELL AS THEIR TASTES
AND PREFERENCES.
 FUTURISTIC
 



 B)
QUANTITATIVE
METHODS:

REGRESSION ANALYSIS:
 THIS ANALYSIS DETERMINES AND
MEASURES THE ASSOCIATIONS
BETWEEN COMPANY SALES AND
OTHER VARIABLES. THERE ARE 3
MAJOR STEPS IN FORECASTING SALES.
  
 IDENTIFY VARIABLES CASUALLY
RELATED TO COMPANY SALES;
 DETERMINE OR ESTIMATE THE VALUE
OF THESE VARIABLES RELATED TO
SALES;
 DERIVE THE SALES FORECAST FROM
THESE ESTIMATES
.
ECONOMIC BUILDING AND
SIMULATION:
   THIS THEORY ESSENTIALLY
IS ATTRACTIVE AS A
SALES FORECASTING
METHOD FOR COMPANIES
INVOLVED IN MARKETING
DURABLE GOODS.
  
 SALES EQUATION FOR A
DURABLE GOODS CAN
BE: 
 S = R + N 
 S = TOTAL SALES;
 R = REPLACEMENT
MARKET SALES POTENTIAL

MAXIMUM LEVEL OF SALES AVAILABLE

TO ALL FIRMS SERVING A DEFINED
MARKET IN A SPECIFIC TIME PERIOD
GIVEN:

1.THE MARKETING MIX ACTIVITIES AND

EFFORTS OF ALL ORGANIZATIONS
2.A SET OF ENVIRONMENTAL CONDITIONS

130
WHY ESTIMATE MARKET
POTENTIAL?

vENTRY/EXIT DECISIONS
vRESOURCE ALLOCATIONS
vLOCATION DECISIONS
vSET SALES OBJECTIVES &
EVALUATE PERFORMANCE
vSET FORECAST (% OF
POTENTIAL)
ESTIMATING POTENTIAL FOR
NEW PRODUCT
 RELATIVE ADVANTAGE OVER
CURRENT PRODUCT
 COMPATIBILITY WITH CURRENT
SYSTEM / NORMS
 RISK (MONETARY, SOCIAL AND
PSYCHOLOGICAL)
 RATE OF ADOPTION OF
COMPARABLE PRODUCTS

ESTIMATING POTENTIAL FOR
MATURE PRODUCT
PASTEXPERIENCE
RECENT TRENDS
◦ COMPETITION
◦ CUSTOMERS
◦ ENVIRONMENT



 MARKET INDEX:
 “IT IS A NUMERICAL
EXPRESSION INDICATING
THE DEGREE TO WHICH
ONE OR MORE MARKET
FACTORS ASSOCIATED
WITH A GIVEN
PRODUCT’S DEMAND IN
A GIVEN MARKET
SEGMENT.”
  

INFORMATION
SOURCES
SECONDARY
DATA
PAST SALES DATA
PRIMARY DATA
TERRITORY
MANAGEME
NT
 W HAT IS A SALES TERRITORY?
A SALES TERRITORY IS
COMPOSED OF A GROUP OF
CUSTOMERS OR A GEOGRAPHIC
AREA ASSIGNED TO A
SALESPERSON.
WHO IS RESPONSIBLE FOR TERRITORIAL
DEVELOPMENT?

DEVELOPMENT OF SALES
TERRITORIES IS USUALLY THE
RESPONSIBILITY OF THE
SALES MANAGER
OVERSEEING THE LARGER
SALES UNITS WITHIN THE
ORGANIZATION.
WHY ESTABLISH SALES
TERRITORIES?
•TO OBTAIN THOROUGH COVERAGE OF THE
MARKET.
•TO ESTABLISH A SALESPERSON’S
RESPONSIBILITY.
•TO EVALUATE PERFORMANCE.
•TO IMPROVE CUSTOMER RELATIONS.
•TO REDUCE SALES EXPENSE.
•TO ALLOW BETTER MATCHING OF
SALESPERSON TO CUSTOMER.
•TO BENEFIT SALESPEOPLE AND THE
COMPANY.
DISADVANTAGES OF SALES
TERRITORIES
•SALESPEOPLE MAY BE MORE
MOTIVATED IF THEY ARE NOT
RESTRICTED.
•THE COMPANY MAY BE TOO SMALL.
•MANAGEMENT MAY NOT WANT TO
TAKE THE TIME, OR HAVE THE KNOW-
HOW.
•PERSONAL FRIENDSHIP MAY BE THE
BASIS FOR ATTRACTING
CUSTOMERS.
 THE SALES TERRITORY IS A BUSINESS

THE RIGHT SALESPERSON

PAYS OFF
FACTORS TO CONSIDER WHEN DESIGNING
TERRITORIES

S e l e c t B A a n s i a c l Dy z e e t e r m
C o n t r o W l U o r n k Ti tl o e ar r d i t o

E v a l Cu a u t s e t , o A Rm se sr v i i
i f N C e e o d n e td a T c te r P r i
1.SELECT BASIC CONTROL UNITS

•STATES
•CITIES AND ZIP-CODE AREAS
•METROPOLITAN STATISTICAL AREAS
•TRADING AREAS
•MAJOR ACCOUNTS
•A COMBINATION OF TWO OR MORE
FACTORS
 2.A NALYZE SALESPEOPLE’S
WORKLOADS

vWORKLOAD IS THE QUANTITY OF

WORK EXPECTED FROM SALES
PERSONNEL.
vTHREE OF THE MAIN
INFLUENCES ON WORKLOAD
INVOLVE
vTHE NATURE OF THE JOB,
vINTENSITY OF MARKET
COVERAGE,
vAND TYPE OF PRODUCTS SOLD.
3.INTENSITY OF MARKET
COVERAGE

DISTRIBUTION METHODS:
•INTENSIVE DISTRIBUTION
•SELECTIVE DISTRIBUTION
•EXCLUSIVE DISTRIBUTION
4.D ETERMINE BASIC TERRITORIES

THE BREAKDOWN APPROACH

USES FACTORS SUCH AS
SALES,
POPULATION,
OR NUMBER OF CUSTOMERS.

Sales Force Size = Forecasted Sales

Average Sales per
Salesperson
SIX STEPS TO CONSIDER WHEN DETERMINING
A FIRM’S BASIC TERRITORIES
1. FORECAST SALES AND
 4. TENTATIVELY ESTABLISH


DETERMINE SALES TERRITORIES.

POTENTIALS.

2. DETERMINE THE SALES

 5. DETERMINE THE NUMBER

VOLUME NEEDED FOR EACH OF ACCOUNTS

TERRITORY.  FOR EACH TERRITORY.

3. DETERMINE THE NUMBER 6. FINALIZE THE



OF TERRITORIES. TERRITORIES, AND DRAW

THE BOUNDARY LINES.
 vTIME MANAGEMENT:
v
v
v
v
v

vTIME MANAGEMENT INVOLVES MAKING

SURE THAT ALL ACCOUNTS ARE
COVERED WITHIN A CERTAIN TIME
PERIOD. TWO IMPORTANT ASPECTS OF
TIME MANAGEMENT:

vROUTING
vSCHEDULING
vSCHEDULING REFERS TO
ESTABLISHING A FIXED TIME WHEN
THE SALESPERSON WILL BE AT A
CUSTOMER’S PLACE OF
BUSINESS.
v
vIN THEORY, STRICT
vIMPROVE FORMAL ROUTE
TERRITORIAL
DESIGNS ENABLE THE SALESPERSON
COVERAGE.
TO:
vMINIMIZE WASTED TIME.
vESTABLISH COMMUNICATION
BETWEEN MANAGEMENT AND
THE SALES FORCE IN TERMS OF
THE LOCATION AND ACTIVITIES
OF INDIVIDUAL SALESPEOPLE.
Scheduling of Sales Persons Time :

vALLOCATE TIME;
vSET DAILY AND WEEKLY
GOALS;
vMANAGE TIME DURING
SALES CALLS;
vEVALUATE
PRODUCTIVITY;
vSETTING UP FUTURE
GOALS
EQUALIZED WORKLOAD
vTHIS METHOD USES THE NUMBER,
LOCATION, AND SIZE OF CUSTOMERS AND
PROSPECTS TO DETERMINE THE FREQUENCY
OF SALES CALLS AND AMOUNT OF TIME A
CALL TAKES BY USING SUCH DATA AS:
vTIME REQUIRED FOR EACH SALES
CALL.
vFREQUENCY OF SALES CALLS PER
GIVEN CUSTOMER.
vTIME INTERVALS BETWEEN SALES
CALLS.
vTRAVEL TIME AROUND TERRITORIES.
vNONSELLING TIME.
vcUSTOMER CONTACT
PLAN
v
vTHE CUSTOMER CONTACT
PLAN INVOLVES
SCHEDULING SALES CALLS
AND ROUTING A
SALESPERSON’S
MOVEMENT AROUND THE
TERRITORY.
 ROUTING:
 “ROUTING IS A PROCESS OF
FORMALLY SETTING A PATTERN FOR
A SALES PERSON TO USE WHILE
MAKING CALLS.
 IT IS A PATTERN WHICH CAN BE
DEVELOPED BY FINDING ACCOUNTS
ON A MAP
 DECIDING THE OPTIMAL ORDER FOR
VISITING THEM AND THE FASTEST
ROUTE TO TAKE.”

ADVANTAGES OF
ROUTING:
 REDUCES TRAVEL TIME;
 REDUCES COSTS;
 REDUCES FATIGUES;
 INCREASES PRODUCTIVITY;
 IMPROVES COMMUNICATION;
 IMPROVES CUSTOMER
RELATIONS;
 MAXIMUM UTILIZATION OF
RESOURCES
 



Disadvantages of
Routing:
ROUTINGREDUCES
FLEXIBILITY

SALES QUOTA
THENUMBER OF
ACCOUNTS AN
INDIVIDUALS CAN
HANDLE BASED ON
HIS CAPACITY
14-2ELEMENTS OF TIME AND TERRITORY
MANAGEMENT FOR THE
SALESPERSON
Salesperson’s
Salesperson’s Set
Setaccount
account
Account
Account
territory’s
territory’s objectives
objectivesand
and
analysis
analysis
sales
salesquota
quota sales
salesquotas
quotas

Territory-time
Territory-time
allocation
allocation

Territory
Territoryand
and Scheduling
Scheduling Customer
Customer
customer
customer and
and sales
sales
evaluation
evaluation routing
routing planning
planning
 14-12A
THREE BASIC ROUTING
PATTERNS
Straight-Line Pattern

First call
c

c c c
Work back
 CLOVERLEAF PATTERN
14-12B

c c

c c

c c
c c c c
c c
Bas
e
c c c c
c c
c c
EACH LEAF OUT AND
c c BACK THE SAME DAY
c c
 MAJOR-CITY PATTERN
14-12C

2 3
1 1=
Downtown

4 5
USING THE TELEPHONE FOR
TERRITORIAL COVERAGE
1. SALES GENERATING
vSELLING REGULAR
ORDERS TO
SMALLER
ACCOUNTS.
vSELLING SPECIALS,
SUCH AS OFFERING
PRICE DISCOUNTS
ON AN INDIVIDUAL
PRODUCT.
2. ORDER
PROCESSING
vORDERING
THROUGH THE
WAREHOUSE.
vGATHERING
CREDIT
INFORMATION.
vCHECKING IF
3. CUSTOMER
SERVICE

vHANDLING
COMPLAINT
S.
vANSWERIN
G
OPEN SALES TERRITORIES
vOPEN SALES TERRITORIES ARE
THOSE LEFT VACANT UNTIL NEW
SALESPEOPLE ARE ASSIGNED TO
THEM.
vVACANT TERRITORIES EXPERIENCE
THE FOLLOWING:
vLOST SALES DUE TO THE
VACANCY.
vLOST SALES DUE TO THE TIME
NEEDED FOR THE NEW
SALESPERSON TO BUILD SALES
vSALES LEAKAGE
vREFERS TO THE LOST
SALES DUE TO BOTH THE
VACANCY AND THE TIME
REQUIRED FOR THE NEW
SALESPERSON TO
PRODUCE AT AVERAGE.
 THE BOTTOM LINE
vACCORDING TO SALESPEOPLE, MANAGING TIME AND
TERRITORY IS THE MOST IMPORTANT FACTOR TO BE
CONSIDERED WHEN CARRYING OUT THEIR SELLING
DUTIES.
vDEVELOPING SALES TERRITORIES HAS ADVANTAGES
AS WELL AS CERTAIN DISADVANTAGES.
vSALES FORCE OBJECTIVES ARE USUALLY CONVERTED
INTO INDIVIDUAL SALES TERRITORIAL GOALS.
vTHE THREE MAIN INFLUENCES AFFECTING THE SALES
PERSONNEL’S WORKLOAD ARE NATURE OF THE JOB,
INTENSITY OF MARKET COVERAGE, AND PRODUCTS
SOLD.
v
vBEFORE DESIGNING SALES
TERRITORIES, MANAGERS MUST
CONSIDER ALL FACTORS.
vTHE CUSTOMER CONTACT PLAN
INCLUDES SCHEDULING SALES
CALLS AND ROUTING
SALESPERSON’S MOVEMENT
AROUND THE TERRITORY.
vTERRITORIAL CONTROL ALLOWS
ACTUAL PERFORMANCE TO BE
COMPARED WITH STANDARDS OF
SALESMANSHIP
DEFINED
ISTHE KNACK OF
SELLING A PRODUCT
OR SERVICE
IT CONSISTS OF
PERSUADING PEOPLE
TO BUY WHAT YOU
HAVE FOR SALE,
FEATURES
vIT IS THE ABILITY TO PERSUADE
vIT BENEFITS BOTH BUYERS AND
SELLERS.
vSTANDS FOR COMMERCIAL HONSTY.
vAIMS AT WINNING THE BUYERS
CONFIDENCE
vAIMS AT SERVING THE PRODUCER,
DISTRIBUTER AND CONSUMER.
vACTS AS A LINK BETWEEN SELLER AND
CONSUMER
vIS AN EDUCATIVE PROCESS.
vCREATES SATISFIED CUSTOMERS
CREATIVE SALESMANSHIP
THE INNOVATIVE ART OF
EDCATING THE PUBLIC
RESULTING IN THEIR
DESIRE TO DEMAND
NEW GOODS AND
SERVICES LEADING TO
IMPROVEMENTS IN
CIVILIZED SOCIETY
KINDS OF SALESMANSHIP

vCOMPETITIVE
SALESMANSHIP
vCOUNTER
SALESMANSHIP
vTRAVELLING
SALESMANSHIP
TYPES
OF
SALESM
1.MANUFACTURERS
SALESMAN
vPIONEER/
vPROMOTIONAL
SALESMAN
vDEALER
SERVICING
SALESMAN
vMERCHANDISE
 2.
WHOLESAL
ERS
SALESMAN
RETAILERS SALESMAN
vCOUNTER/
 INDOOR
SALESMAN
vTRAVELLING/
OUTDOOR
SALESMAN
4.GENERAL SALESMAN
vSTAPLE SALESMAN
vDOOR TO DOOR
SALESMAN
vMISSIONARY
SALESMAN
vSERVICE SALESMAN
vEXPORTER SALESMAN
vINDUSTRIAL SALESMAN