Chapter 2 Personal Selling -Sales and Distribution Management.ppt

Chapter 2 Personal Selling -Sales and Distribution Management.ppt

1. Copyright © 2010, S L Gupta
Excel BooksSales and Distribution Management Text & Cases (2
nd
Edition) S L Gupta2-1
Personal Selling
Basics of Sales Management
Ch-2
Block:
I
Chapte
r
2
Personal Selling

2. Copyright © 2010, S L Gupta
Excel BooksSales and Distribution Management Text & Cases (2
nd
Edition) S L Gupta2-2
Personal Selling
Basics of Sales Management
Ch-2
Block:
I
Cont….
Introduction
Some important aspects of personal selling are:
1. It enhances customer’s confidence in the seller.
2. It promotes long-term business relations through personal intimacy.
3. It provides a human touch to business transactions.
4. It helps facilitate the seller to understand each customer’s needs and
preferences more clearly.
5. It helps satisfy a customer by modifying the product as per the customer’s
choice and preference.
6. Personal selling followed by personal service helps build long-term relations
between the business and the customer.
7. It helps keep up with the competition in the market, based on product
customisation as per customer’s preferences.

3. Copyright © 2010, S L Gupta
Excel BooksSales and Distribution Management Text & Cases (2
nd
Edition) S L Gupta2-3
Personal Selling
Basics of Sales Management
Ch-2
Block:
I
8. It is a powerful and effective tool for convincing the customer about the
product.
9. Through personal selling the time lag between introducing a product through
the media and actually selling it is reduced.
10. It provides prospective customers with a better understanding of the product
and an interactive opportunity to liaise with the sales personnel.

4. Copyright © 2010, S L Gupta
Excel BooksSales and Distribution Management Text & Cases (2
nd
Edition) S L Gupta2-4
Personal Selling
Basics of Sales Management
Ch-2
Block:
I
Objectives of Personal Selling
Personal selling objectives may be:
Short-term
Short-term personal selling objectives are more specific and of short-term
duration. These objectives change very frequently as soon as there is change in
production mix. Further, they are usually quantitative objectives.
Long-term
Long-term personal selling objectives are broad and general. There is very little
scope of change in long-term objectives. They are usually quantitative objectives.

5. Copyright © 2010, S L Gupta
Excel BooksSales and Distribution Management Text & Cases (2
nd
Edition) S L Gupta2-5
Personal Selling
Basics of Sales Management
Ch-2
Block:
I
Functions of Personal Selling
Personal selling is an oral presentation in face to face conversation with one or
more prospective customers for the purpose of making sales. The main functions
of personal selling are as follows:
1. Provide service to customers (Introduce the product, explain the right use,
Convince them etc.)
2. To sell the product
3. Maintain the sales record
4. Executive Function
5. Develop goodwill
6. Achieve sales target

6. Copyright © 2010, S L Gupta
Excel BooksSales and Distribution Management Text & Cases (2
nd
Edition) S L Gupta2-6
Personal Selling
Basics of Sales Management
Ch-2
Block:
I
Cont….
Changing Face of Personal Selling
Modern sales approach is based on the following parameters
1. Value Sharing: Salespeople study the changing needs and preferences of
their customers.
2. Relation Building: A value-based relationship helps the salespeople to
constantly mobilise resources and modify the end product by catering to the
specifics of the buyer.
3. Role Playing: The salespeople, in personal selling, go far beyond realising
sales. Sales people act as consultants to their prospective customers
constantly advising them of new products, their updates and impart
knowledge to them.
4. Changing Approach: Personal selling comes in a package containing the
inputs of the experts from different areas such as maintenance, installation,
trouble shooting, delivery staff, sales personnel, etc.

7. Copyright © 2010, S L Gupta
Excel BooksSales and Distribution Management Text & Cases (2
nd
Edition) S L Gupta2-7
Personal Selling
Basics of Sales Management
Ch-2
Block:
I
Benefits of personal selling
1. Availability of expertise
2. Early access to relevant market information
3. Availability to be flexible regarding processes, timing
4. Faster, shorter contracts
5. Economies of information sharing
6. Lower cost of selling
7. Knowledge of other uses or applications

8. Copyright © 2010, S L Gupta
Excel BooksSales and Distribution Management Text & Cases (2
nd
Edition) S L Gupta2-8
Personal Selling
Basics of Sales Management
Ch-2
Block:
I
Cont….
Efficacy of Personal Selling
Personal Selling with Respect to Product Strategy
Since salespeople are in direct liaison with prospective customers, their input is
valuable during product development.
Personal Selling and Pricing Decisions
Sales personnel undergo requisite interaction with prospective customers to
gauge their mood with respect to different price levels.
Personal Selling and Distribution
The end result of any distribution effort is the ready availability of the product to
the customer, in the right quantity and at the right place.
Personal Selling and Product Promotion
Sharing the same values that the customer does, a salesperson provides
motivation and generates interest and confidence in the customer for the product.

9. Copyright © 2010, S L Gupta
Excel BooksSales and Distribution Management Text & Cases (2
nd
Edition) S L Gupta2-9
Personal Selling
Basics of Sales Management
Ch-2
Block:
I
Cont….
Steps in Personal Selling
Successful personal selling calls for an integrated approach devised from the
experience of the sales personnel. The approach comprises the steps as shown
in the figure here. Each of these steps are further described in brief.
Steps in Personal Selling

10. Copyright © 2010, S L Gupta
Excel BooksSales and Distribution Management Text & Cases (2
nd
Edition) S L Gupta2-10
Personal Selling
Basics of Sales Management
Ch-2
Block:
I
Cont….
Prospecting
Prospecting is the process of identifying prospective buyers of the product. A
prospect is qualified if he has the authority, need, ability and eligibility to buy.
There are different ways to identify prospects. Some of the most frequently used
methods are described below:
 Acquaintance References
 Cold Calling
 Centre of Influence Method
 Personal Observation Method
 Direct Mail or Telephone Method
 Company’s Records
 Newspapers
 Retailers
 Other Methods

11. Copyright © 2010, S L Gupta
Excel BooksSales and Distribution Management Text & Cases (2
nd
Edition) S L Gupta2-11
Personal Selling
Basics of Sales Management
Ch-2
Block:
I
Cont….
Pre-approach
Pre-approach is the second step in the selling process which emphasises that the
salesman should know, after identifying the prospect in the prospecting stage, the
prospect’s likes and dislikes, his needs, preferences, habits, nature, behaviour,
economic and social status etc.
Significance of Pre-Approach
1. Salesman concentrates only on the prospects and not the suspects.
2. Salesman gain all the possible information about the prospect before
approaching him. Hence any kind of loose talk or serious mistake can be
avoided.
3. He is able to give a sales presentation more efficiently, effectively and with
confidence.
4. It does not waste the prospect’s time and energy since the salesman is
already aware of the needs and preferences of the prospect.

12. Copyright © 2010, S L Gupta
Excel BooksSales and Distribution Management Text & Cases (2
nd
Edition) S L Gupta2-12
Personal Selling
Basics of Sales Management
Ch-2
Block:
I
Cont….
The “Ferris Wheel”
concept, which is
aimed at supplying an
ongoing list of
prospects, is part of
world sales record
holder Joe Girard’s
customer strategy
P
P
P
P
P
P
P
P
P
P
P
P
Referrals
Relationship between
customer and sales-
person deteriorates
Friends and
acquaintances
Business failure
Directories New buyer buys from
another source
Trade publications
and trade shows
Acquisitions and mergers
Telemarketing and
advertising
Customer moves
Death of customer
Cold calling
Customer has only a
product
one-time need for
Networking Customer needs change
because of new technology

13. Copyright © 2010, S L Gupta
Excel BooksSales and Distribution Management Text & Cases (2
nd
Edition) S L Gupta2-13
Personal Selling
Basics of Sales Management
Ch-2
Block:
I
Cont….
Usage of Prospecting Time
 Sales force must plan its time in such a manner that maximum time is made
available for those prospects who are likely to give a large volume of business
to the company.
 To avoid this wastage of time, grading of the prospects will be an important
step.

14. Copyright © 2010, S L Gupta
Excel BooksSales and Distribution Management Text & Cases (2
nd
Edition) S L Gupta2-14
Personal Selling
Basics of Sales Management
Ch-2
Block:
I
Cont….
Approaching
 In this stage the prospect and the salesman come in contact with each other
face to face.
 The salesman has an opportunity to understand and interact with the
prospect in a better way.
 Salesman should put forward his best efforts to make the best use of this
opportunity in getting the attention of the prospect and to convince him to buy
the product.
 Getting the attention of the prospect and persuading him to buy are the two
main objectives of a salesman.

15. Copyright © 2010, S L Gupta
Excel BooksSales and Distribution Management Text & Cases (2
nd
Edition) S L Gupta2-15
Personal Selling
Basics of Sales Management
Ch-2
Block:
I
Cont….
Approach Adopted by Travelling Salesmen
 A salesman may directly approach the prospect without any introduction
whatsoever and then conduct an interview.
 Sending an advance mailer explaining his product and its benefits vis-à-vis
other products available.
 There is no better method of securing an appointment with a prospect than
through a reference given by the friend, relative or business associate of the
prospect.
 Another effective way of securing an appointment and interview with the
prospect is for salesmen to give away gifts to the prospects before asking for
an appointment.
 Sale letters have proved to be another kind of door opener.

16. Copyright © 2010, S L Gupta
Excel BooksSales and Distribution Management Text & Cases (2
nd
Edition) S L Gupta2-16
Personal Selling
Basics of Sales Management
Ch-2
Block:
I
Cont….
Successful Approach
The following points specify the importance of a successful approach:
i. A successful approach enhances the sale and it is thus important for the
running of a business.
ii. A failed approach will give an opportunity to the rival company. So a good
approach will go a long way in building good relations with the prospect while
a bad approach will not only result in losing business but will also make it
easy for a competitor to tap new customers.
iii. The approach helps in enlightening the prospect by providing him ample
information about the product, price, competitor’s product, benefits etc. that
he can derive from the product.

17. Copyright © 2010, S L Gupta
Excel BooksSales and Distribution Management Text & Cases (2
nd
Edition) S L Gupta2-17
Personal Selling
Basics of Sales Management
Ch-2
Block:
I
Cont….
Key guidelines for successful approach
 Prior Appointment
 Timing
 Command
 Relaxed Atmosphere
 Open Mindedness
 Courtesies
 Effective Presentation
 Follow up

18. Copyright © 2010, S L Gupta
Excel BooksSales and Distribution Management Text & Cases (2
nd
Edition) S L Gupta2-18
Personal Selling
Basics of Sales Management
Ch-2
Block:
I
Cont….
Methods of Approach
There are different methods of approaching a prospect and some of the most
important ones are given below.
 Cashing in on Brand Name or the Company’s Reputation
 Customer Benefit Approach
 Innovative Product Opens the Door to the Salesman
 The Premium Approach (Small Gifts or Novelties)
 The Stock Approach
 The Approach of ‘Making the Prospect Feel Important’
 The Survey Approach
 Interactive Approach

19. Copyright © 2010, S L Gupta
Excel BooksSales and Distribution Management Text & Cases (2
nd
Edition) S L Gupta2-19
Personal Selling
Basics of Sales Management
Ch-2
Block:
I
Cont….
Presentation
 Quick presentation creates a good impression.
 Attractively packaged, decorated and well- organised.
 Should explain the product with its features and price advantage to the
customer in simple and easy terms.
 Customer be shown the kind of quality that he is looking for.
 Helps the salesman to prove the features of the product and emphasise its
genuineness.

20. Copyright © 2010, S L Gupta
Excel BooksSales and Distribution Management Text & Cases (2
nd
Edition) S L Gupta2-20
Personal Selling
Basics of Sales Management
Ch-2
Block:
I
Cont….
Demonstration
 Demonstration is an exercise to prove the characteristics of the product.
 It highlights various attributes of the product such as utility, performance,
service and quality.
 It is only during the demonstration that the customer gets an opportunity to
verify the facts about the product.
 Demonstration is imperative and essential for a prospect to make a buying
decision.

21. Copyright © 2010, S L Gupta
Excel BooksSales and Distribution Management Text & Cases (2
nd
Edition) S L Gupta2-21
Personal Selling
Basics of Sales Management
Ch-2
Block:
I
The Close
 This is the last stage of any sales presentation.
 The main aim of the close is to convince the prospect to sign the order form
or to place an order immediately rather than in the future.
 It is also important that through proper planning, prospecting, presentation
and demonstration the salesman should try to capture the attention of the
prospect and not let the prospect change his mind.

22. Copyright © 2010, S L Gupta
Excel BooksSales and Distribution Management Text & Cases (2
nd
Edition) S L Gupta2-22
Personal Selling
Basics of Sales Management
Ch-2
Block:
I
Cont….
Relationship of Salesmanship with Sales Management
and personal Selling
Salesmanship & Personal Selling
1. The ability to quickly develop rapport with their prospective customers.
2. A desire to truly help their customers.
3. The habit of asking questions to gather information before making a pitch.
4. Sticking to a consistent, proven sales process.
5. A never ending desire to learn more about how to sell more effectively.

23. Copyright © 2010, S L Gupta
Excel BooksSales and Distribution Management Text & Cases (2
nd
Edition) S L Gupta2-23
Personal Selling
Basics of Sales Management
Ch-2
Block:
I
Cont….
Myths about selling
Myths of selling: There are various myths about selling process which needs to
be cleared for a sales person.
1. Buyers are liars
2. Anyone can be persuaded to buy
3. In buying decision, price is the primary reasons
4. A technique that works well for one person will work for everyone
5. Close the sales as soon as possible
6. The deal can be closed at any price

24. Copyright © 2010, S L Gupta
Excel BooksSales and Distribution Management Text & Cases (2
nd
Edition) S L Gupta2-24
Personal Selling
Basics of Sales Management
Ch-2
Block:
I
Cont….
Various Selling theories
“SELL” Model
This is a simple model describing the various actions associated with the word
itself.
1. Show features: it is the very first stage; expected to show the features of the
product, demonstrating how it works, and showing the results of using the
product immediately.
2. Explain advantage: Immediately, after demonstrating the product, explain
the advantage possibly related with the features, showing the advantages
which ate derived from it.
3. Lead into benefits: Correlate the advantages with the benefits. This is
simply highlighting the materialization of those benefits in conducting the set
of activities due to having/using the product.
4. Let them talk: Then at the end, let them talk further about the product, its
features and those future benefits. If the previous steps are done well, they
will talk themselves for the sale.

25. Copyright © 2010, S L Gupta
Excel BooksSales and Distribution Management Text & Cases (2
nd
Edition) S L Gupta2-25
Personal Selling
Basics of Sales Management
Ch-2
Block:
I
Cont….
“SLAID” Model
This is another simple model describing the various actions associated with the
word itself, “Slaid” acronym for sales steps.
1. Show the product: Showing the product in full or showing specific function
is also possible in the beginning, just to trigger the anxiety or curiosity in their
mind. It is not a full product demonstration. Demonstration comes a bit latter
state in this methods.
2. Listen: A partial demonstration flash triggers a lot of questions, or
estimations or expectations, in case if the product is absolutely new concept.
3. Acknowledge: Your hearing will endorse that you have understood and are
ready to fulfill their needs. You may be given elaborative further deep
information about their objection.

26. Copyright © 2010, S L Gupta
Excel BooksSales and Distribution Management Text & Cases (2
nd
Edition) S L Gupta2-26
Personal Selling
Basics of Sales Management
Ch-2
Block:
I
Cont….
4. Identify: Identify the objections, and bring them on a squaring off situation
with contents offered by your product. If possible, set up a concession clause,
balancing the benefits of new product over the old objections, so that you can
handle the objection and will get the sale.
5. Deliver: Ask the participants to repeat the demonstration to build the
confidence about the product performance.

27. Copyright © 2010, S L Gupta
Excel BooksSales and Distribution Management Text & Cases (2
nd
Edition) S L Gupta2-27
Personal Selling
Basics of Sales Management
Ch-2
Block:
I
Cont….
Theories of selling
Stimulus response Approach to Selling
This is the simplest approach to selling and is shown in Figure. It is up to the
salesperson to provide stimuli, of any kind, initially. This is followed by an attempt
to obtain a response from the prospective buyer a continued on until a decision is
made.
Stimulis response Approach to Selling
Salesperson provide
stimuli:
Statement
Questions
Actions
Audio/visual aids
demonstrations
Buyers responses
sought:
Favourable
reactions and
eventual purchase
Continue process
until purchase
decision

28. Copyright © 2010, S L Gupta
Excel BooksSales and Distribution Management Text & Cases (2
nd
Edition) S L Gupta2-28
Personal Selling
Basics of Sales Management
Ch-2
Block:
I
Cont….
Mental State Selling
 This approach utilizes the understanding of the AIDA (Attention, Interest,
desire, Action) concept and its utilization in the selling process.
 It follows the same strategy of the Stimulus response Approach where a
script is prepared and followed. What is different here is the timing.
 The timing refers to the mental state of the prospective buyer, whether at
Attention, Interest, Desire, or Action.
Simplified tasks that the salesperson can do is as follows:
Mental State Sales Task
Awareness To get prospective buyers to be interested in the product
Interest To get prospective buyers to want the product
Desire To get prospective buyers to buy the product
Action To close the sale

29. Copyright © 2010, S L Gupta
Excel BooksSales and Distribution Management Text & Cases (2
nd
Edition) S L Gupta2-29
Personal Selling
Basics of Sales Management
Ch-2
Block:
I
Need satisfaction selling
 It was critical for salesmen to know what the needs of the customer were.
 This was done by various methods, including visit, studies of the customers,
questioning and constantly probing.
Need satisfaction Approach to Selling
Uncover and confirm
Buyer needs
Present offering to
satisfy Buyer need
Continue selling until
purchase decision

30. Copyright © 2010, S L Gupta
Excel BooksSales and Distribution Management Text & Cases (2
nd
Edition) S L Gupta2-30
Personal Selling
Basics of Sales Management
Ch-2
Block:
I
Cont….
Difference between advertising and Personal selling
Both—personal selling as well as advertising—are the means to communicate
with the target customers for the product or service of an organisation. To be
effective, i.e., to produce results, in terms of sales or orders, both should be
understandable, interesting, believable and persuasive.
i. However, there are some notable differences between these two means of
communication.
ii. The customer comes in direct contact with the salesperson. In advertising,
on the other hand, the customer does not come in direct contact with any
representative of the organisation.
iii. Advertising has a major role during the pre-purchase phase as the mass
demand for the product has to be generated. Advertising also plays an important
role in post-purchase phase as it gives sound reassurance to the
purchaser. Personal selling, on the other hand, has an important role to play
in all the three phases. It plays a major role in the purchase phase.

31. Copyright © 2010, S L Gupta
Excel BooksSales and Distribution Management Text & Cases (2
nd
Edition) S L Gupta2-31
Personal Selling
Basics of Sales Management
Ch-2
Block:
I
Three Phase of a Products/Brand’s Market
1. Pre-purchase phase
2. Purchase phase
3. Post-purchase phase
The pre-purchase phase is characterised by the phase where the organisation is
trying to convince the targeted customers of the benefits of the product/brand.
The purchase phase is the time/duration when the customer is making up his
mind to actually buy the product. The post-purchase phase is one when the
customer has bought the product and is evaluating the decision.

Pre-purchase Purchase Post-purchase
Personal
Selling
Advertising

32. Copyright © 2010, S L Gupta
Excel BooksSales and Distribution Management Text & Cases (2
nd
Edition) S L Gupta2-32
Personal Selling
Basics of Sales Management
Ch-2
Block:
I
Cont….
Theories of Personal Selling
There are three main theories of personal selling, which are as follows:
 AIDAS Theory
 Right Set of Circumstances Theory
 Buying Formula Theory

33. Copyright © 2010, S L Gupta
Excel BooksSales and Distribution Management Text & Cases (2
nd
Edition) S L Gupta2-33
Personal Selling
Basics of Sales Management
Ch-2
Block:
I
Cont….
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.
 Attention: The salesperson should attract the prospect to his presentation
before he actually goes into the details of the same.
 Interest: He/she should maintain the interest of the prospects throughout the
presentation.
 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.
 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.

34. Copyright © 2010, S L Gupta
Excel BooksSales and Distribution Management Text & Cases (2
nd
Edition) S L Gupta2-34
Personal Selling
Basics of Sales Management
Ch-2
Block:
I
Cont….
Right Set of Circumstances Theory
The advocates of this theory opine that all the circumstances, which led to the
sales, were appropriate or “right” for the sales to have taken place. In other
words, if the salesperson is successful in securing the prospect’s attention,
maintaining his interest and inducing his desire to buy the product, sales will
result. Moreover, if the salesperson is highly skilled, he will take control of the
presentation, which would lead to sales.

35. Copyright © 2010, S L Gupta
Excel BooksSales and Distribution Management Text & Cases (2
nd
Edition) S L Gupta2-35
Personal Selling
Basics of Sales Management
Ch-2
Block:
I
Buying Formula Theory
The buying formula theory is based on the analysis of the sequence of events that
goes on in the buyer’s mind during the sales presentation. Thus, the theory
emphasises on the factors internal to the prospect and the factors which are
external, i.e., influence of the salesperson on his prospect’s decision to buy his
product. The theory is based on the presumption that the salesperson will take
care of the external factors.
The sequence of events in a prospect’s mind can be represented as
There 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
SatisfactionPurchaseNeed Solution