Sales Management and Sales Promotion

All details related sales management and promotion

1. SALES MANAGEMENT AND
SALES PROMOTION

2. SALES MANAGEMENT
•According to American Marketing Association
Sales Management is defined as the planning, direction and control
of personal selling, including recruiting, selection, equipping,
assigning, routing, supervising, paying and motivating as these
tasks; apply to the personal sales force.

3. Job and Role of Sales Management in
Organization
•Planning:
–Building a profitable customer-oriented sales team
•Staffing:
–Hiring the right people to sell and lead
•Training
–Educating sales personnel to satisfy customers
•Leading
–Guiding average people to perform at above average levels
•Controlling
–Evaluating the past to guide the future

4. Sales Organization and Its Evaluation
•According to Still and Cundiff:
“A sales organization, like any organization, is a group of individuals
striving jointly to reach certain goals and bearing formal as well as
informal relations to each other”

5. Evaluation of Sales Organization
Effectiveness of
a Sales
organization
Sales Analysis
Cost Analysis
Productivity Analysis

6. Sales Analysis
Methods of Sales Analysis:
Total Sales Volume
Sales by Region
Sales by Salesperson
Sales by Customer Classification
Sales Analysis by product Line
Sales Analysis by Distribution Channels
Sales Analysis by Units Sold

7. Cost Analysis
SOMETIMES CALLED AS PROFITABLE ANALYSIS OR MARKETING
COST ANALYSIS
Methods of Cost Analysis:
Analysis of Ledger Expenses
Analysis of Activity Expenses
Personal Selling Expenses
Advertising and Sales promotion expenses
Warehousing and shipping expenses
Order Processing Expenses
Administration Expenses
Analysis of Activity Costs by Market Segments

8. Productivity Analysis
Productivity is a measure of output from a production process, per
unit of input.
Productivity=Outputs
Inputs

9. Selling Functions
•Product Planning and Development
•Contactual Function
•Creation of Demand
•Negotiations
•Sales Contract

10. System Selling
•System selling entails selling a set of interrelated
components that fulfill all or a majority of a
customer’s needs in a product or service area.
•The concept of system’s selling means selling a
total package of related goods and services to
solve a customer’s problems.

11. Importance of System Selling in Contemporary
Environment
•Produces a larger Initial Sale
•Reduces Compatibility Problems
•Supplier also Retained
•Save Time
•Consultative Role
•Maximizes Effectiveness

12. Selling of Services as Opposed to Selling of
Tangible Products
•A service is the non-material equipment of a good.
•Hotel Business
•Education
•Medical Service
•Transportation
•Insurance Service
•Coaching
•Banking
•Personal Care
•Legal Services

13. Selling Services Versus Selling Products
•Basic Difference
Tangibility
Transfer of Ownership
Pricing
Features and Benefits
Marketing Strategies
Visuals
Re-selling
Customer Relationship
Customer Relationship

14. Sales Management Planning
According to American Marketing Association;
“Sales planning are the work of setting up objectives for selling
activities, determining and scheduling the steps necessary to
achieve these objectives.”

15. Components of Sales Management Planning
1)Selling Objectives: determining and achieving the objectives according to
the plan.
2)Sales Policies: Guidelines made for deciding and performing various selling
activities.
3)Sales Programme: Launching a new product, Sales promotion activities,
entering into new market, sales force training.
4)Sales Procedure: Plans which determine sequence of different selling
activities.
5)Sales Rules: What is to be done and what is not to be done in particular
situation. Applicable to all sales personnel without distinction.
6)Sales Forecasts: is an estimate of sales in rupees or in units or in both for a
specified future period under proposed marketing plan.
7)Sales Budgets: estimate of future sales, selling expenses and total profits
from sales orientations.
8)Sales Strategy: to consider the plans and policies of competing business
units and plan our strategy accordingly
9)Sales Quotas: individual sales target figure assigned to each sales units.

16. Types of Sales Management Planning
a.Sales Plan on the basis of Market area
b.On the basis of Selling Functions
c.On the basis of Types of Customers
d.On the basis of Types of Products
e.On the basis of Time period

17. SALES MANAGEMENT INFORMATION SYSTEM
SMIS is the system by which sales data are collected, analyzed, interpreted and
distributed to a company’s sales managers.
It helps to spot important trends in market, changing customer needs and opportunities
for market growth.
Information comprising the SMIS is collected from salespersons field reports, internal
sales records, historical data.
Useful tool to spot problems and opportunities and to develop projections.

18. Features of SMIS
•Access of Information
–Managers can access the information they need, the way they want it from own desktop
•Reports
–Overall sales performance
–Detailed break-down of sales by salesperson/by period against budgetary targets
–Revenue projections based on contracts written
–Comparison of salesperson performance against sales targets
–Station inventory availability and yield
•Data Mining Tools:
–Extract information from invoice sales to give custom ranking and analysis broken-down
by user-selected criteria; sales person, type of business, area, timeframe
•Real-Time Analysis:
–Real-time analysis of projected sales revenue gives detailed break-downs of billing by
type of sale over a user selected timeframe.
•History
–Salesperson performance history
–Monitoring actual sales against individual monthly targets

19. Components of SMIS
•Sales Support:
–Product information
–Product Price
–Discount information
–Sales incentives
–Sales promotions
–Financing plans for customer
–Strengths and weaknesses of competitors’ products
–The histories of customer relations with the company.
–Sales policies and procedures established by company
–Product that have not yet been introduced
–Product inventory level

20. •Sales Analysis:
–Product sales trends
–Product profitability on a product-by-product basis
–The performance of each sales region and sales branch
–Salesperson’s performance
•Customer Analysis:
–To establish a profile of buying habits
–To determine the profitability of each customer on a contribution margin basis

21. APPLICATIONS OF SMIS
•Business Processes:
–Contacting customers
–Selling the products and services
–Taking orders
–Following up on sales
•Monitor Trends:
–To monitor new product and sales opportunities
–Support planning for new products and services
–Monitor the performance of competitors
•Supports Marketing Research:
–Supporting market research
–Analyzing advertising and promotional campaigns, pricing decisions
•Provide Aids for Operational Management:
–Aids to locating and contacting prospective customers
–Tracking sales and processing orders
–Providing customer service support
•Tracking of Sales:
–Determine sales revenue
–Identify hot-selling items and other sales trends

22. Sales Forecasting
•According to American Marketing Association:
“Forecasting is an estimate of sales in dollars or physical units for a specified future
period under a proposed marketing plan or program and under an assumed set of
economic and other forces outside the unit for which the forecast is made. The
forecast may be for a specified item of merchandise or for an entire line”

23. Objectives of Sales Forecasting
•Short-Run Objectives:
–Formulation of suitable production policy so as to meet the demand as per the sales forecast.
–To make provision for the regular supply of raw material
–To make the best utilization of the machines
–To make the regular supply of the labour force
–To determine appropriate price policy for a given period
–Estimate and provide the requisite working capital
–To establish the sales quotas targets for different market segments
–To estimate stock requirements for unfinished, semi-finished and finished products for a specific
period of time.

24. •Long-Run Objectives:
–Estimating cash inflow from sales
–Provision for capital expenditure
–Planning of plant capacity so as to meet rising future demand
–Manpower planning
–Planning for acquisition of raw materials
–Determining the dividend policy
–Establishing coordination between various functions of an organization
–Reducing selling cost
–To facilitate budgeting and budgetary control
–To estimate future profits of the business enterprise.

25. TECHNIQUES OF SALES FORECASTING
•A sales forecasting technique is a procedure for estimating how much of a given
product (or for product line) can be sold if a given marketing program is
implemented.
•Well managed companies do not rely upon a single forecasting technique but use
several.
•Sales forecasting techniques can be broadly classified as qualitative techniques:

26. Executive Opinion Trend Projection Method
Delphi Method Exponential Smoothing
Sales Force Composite Method Naïve/Ratio Method
Survey of Buyers Expectations Regression Analysis
Historical Analogy Method Econometric Method
FORECASTING TECHNIQUES
QUALITATIVE METHODS QUANTITATIVE METHODS

27. SALES BUDGETING
•Budgeting is an art of presenting future plans in quantitative terms. Sales budget is
an estimate of future sales-units, sales-value, selling expenses and total profit from
sales operations.
•Sales budget generally has two parts;
1.Revenue Part: is related to estimating sale-units and sale-value for a certain future period of time.
2.Expense Part: is related to estimating selling expenses to be incurred to achieve estimated sales.

28. Purpose and Significance of Sales Budgeting
•Planning
•Better Communication and Coordination
•Control and Performance Evaluation
•Psychological Benefits

29. Sales Budgeting Process
•Preliminary Situation Analysis
•Development of Sales Forecast
•Fixation of Preliminary Sales Targets
•Determination of Sales Activities
•Fixation of Sales budget
•Finalization of Projections at Department Level
•Presentation before Top Management
•Review of Sales Budget
•Approval of Sales Budget

30. Methods of Sales Budgeting
•Budgeting by percentage of Sales Method
•Budgeting by the Objective and Task Method
•Affordability Method
•Competitive Parity Method
•Return Oriented Method

31. SALES QUOTAS
•A sales quota is a part of a company’s total estimated sales assigned to a
salesman, a territory, a branch, a distributer or dealer or to some other selling unit,
as a goal to be attained in a designated future period of time.

32. Types of Sales Quotas
•Sales Volume Quotas
a. Rupees Sales Volume Quotas
b. Unit Sales Volume Quotas
c. Point Sales Volume Quotas
•Sales Budget Quotas
a. Expense Quotas
b. Gross Margin or Net Profit Quotas
•Sales Activity Quotas
•Combination and Other Point System Quotas

33. Methods of Setting Sales Quota
•Based on Sales Potential of Individual Units
•On the basis of Sales Potential of Total Market
•On The Basis of Last Year’s Sales
•On the Basis of Judgment of High Officials
•On The basis of Sales Force Own Estimates

34. SALES MANPOWER PLANNING
•A major function of sales force management is procuring the qualified sales
personnel in sufficient numbers to meet the requirements of the organization.

35. Nature of Manpower Planning
•Dynamic Activity
•Well-defined Objectives
•Determines Sales Personnel Needs
•Consists of Current Sales Person Inventory
•Adjusting Demand and Supply
•Creating Proper Work Environment
•Development of Policies
•Complementary to Organization Planning

36. Purpose of Sales Manpower Planning
•To workout the Compensation Levels
•To Improve Systems of Selling
•To Review Effective of Sales Policies
•To Remove Deficiency from Individuals and make them Better Salesmen
•Review Effectiveness of Supervisor

37. Sales Manpower Planning Process
•Establishing Responsibilities:
•Deciding the number of Salespeople Needed
•Outline the Type of Salespeople Needed
a.Sales force Job Analysis
b.Sales force Job Description
c.Sales Force Job Specifications

38. Significance of Sales Manpower Planning
•Reservoir of Talent
•Prepare Sales Force for Future
•Facilitates Smooth Expansion of Sales organizations
•Cut Costs

39. Development of Sales Organization
•It supports to achieve organizational objectives.
•It is related to the structure of organization which supports to the sales force

40. Principles of organization Development
•Should Reflect a Marketing Orientation
•Should be built around activities, not around people
•Responsibility and Authority should be related properly
•Span of executive control should be reasonable
•Organization should be stable but flexible
•Activities should be balanced and coordinated

41. Steps in Developing Sales Organization
•Defining Objectives
•Determination of Activities and their volume of Performance
•Grouping activities into performance
•Assignment of Personnel to Positions
•Provision for Coordination and Control

42. Recruitment of Sales Personnel
•Recruitment is the process of locating and attracting job applicants. Recruiting and
selecting e new sales force is an important aspect of the sales manager’s job.
•Recruitment is the set of activities and processes used to legally obtain a sufficient
number of individuals in such a manner that the recruits and the sales force’s best
interests are taken into consideration.

43. Sources of Recruitment
•Internal Sources
a. Present Employees Already Working in the Organization
b. Recommendation of the Existing Salesman
c. Promotions
d. Transfers
e. Re-employment of Former Employee
f. Employee Referral Programs
g. Interns and Cooperative Students

44. •External Sources:
a. Direct Unsolicited Applications/ Walks-ins
b. Employment Agencies
c. Salespeople Making Calls on the Company
d. Customers as a Recruiting Source
e. Sales Forces of Non-competing Companies/ Other Industry Sources
f. Sales Forces of Competing Companies
g. Educational Institutions and Campus Placement
h. Wholesalers, Retailers and Customers
i. Advertising
j. Web-Sources
k. Networking

45. Selection of Sales Personnel
•Selection is the process of making a hire or no hire decision regarding applicant for
a job.
•The sales manager obtains the database of candidates to be selected from the
recruitment stage.
•A sound selection of salesperson increases goodwill of the firm.
•In the eyes of buyers, a salesperson represents the company. If he makes poor
impression, the company too suffers loss of reputation among its customers

46. Criteria Used for Selection Of Sales Personnel
•Mental Alertness
•Business Terms and Memory Recall Aptitude
•Communication Skill
•Numerical Ability
•Personality Dimensions
•Honesty or Character Strength
•High Energy Levels
•Dominance
•Competitiveness
•Emotional Maturity
•Work Motivation

47. Process of Selection of Sales Personnel
•Pre-interview and Preliminary
•Formal Application
•Interview
•Psychological Testing
1. Knowledge Tests
2. Ability Tests
3. Aptitude Tests
4. Achievement Tests
5. Personality Tests
6. Temperament Tests
7. Graphology
8. Simulation Exercise
•Reference Check
•Physical Examination
•Job Offer

48. Training and Development of Sales Personnel
•Training can be defined as the development of skills and faculties, to do a particular
job in the given way through systematic teaching and guidance.
•According to Edwin B. Flippo, “Training is the act of increasing knowledge and skill
of an employee for doing a particular job.”
•According to National Society of Sales Training Executives (USA), “ Sales training
is the intentional and sound application of ordinary human sense to the problem of
helping the sales personnel to make the most of its talents.”

49. Development
•Development is a long-term educational process utilising a systematic and
organised procedure by which sales personnel get conceptual and theoretical
knowledge.
•In other words, it refers not to technical knowledge and skills in operation but to
philosophical and theoretical educational concepts.
•It involves broader education and its purpose is long-term development.

50. Contents of Sales Training
•Training about a Product
•Training on the After Sales Service
•Training on Company
•Training on Sales Organization
•Training on Sales Policy
•Training in Reporting Systems
•Training in Business Ethics
•Training in Selling Skills

51. Sales Training Methods
•Group Training Method
i. Lecture Method
ii. Audio-Visual Method
iii. Discussion Method
iv. Conference Method
v. Role Playing Method
•Individual Training Method
i. Training on the Job
ii. Training through Correspondence
iii. Training through Special Assignments
iv. Observation Methods

52. Types of Sales Training
•Skills Training
•Refresher Training
•Cross-Functional Training
•Team Training
–Content Tasks
–Group Processes
•Creativity Training
a.Breaking Away
b.Generate New Ideas
c.Delaying Judgement
•Diversity Training
•Literacy Training

53. Importance of Sales Training
•Higher Sales Volumes
•Better Product Knowledge
•Eliminates Waste
•Influences Prospects in Better Way
•Reduces Control and Supervision
•Develops High Morale
•Low Turnover of Sales Force

54. Evaluation Of Sales Training
•Reactions
•Learning
•Behaviour
•Results

55. Time and Territory
Management

56. Time Management
•Time is utmost importance in business.
•The productivity of sales force can be
improved by developing effective strategies for
time management.
•In this age of the internet and mobile
communications, the time required for
communicating has reduced drastically.

57. Methods of Time Management
•Developing a Series of Personal Goals
•Preparing a Daily To Do List
•Maintain a Planning Calendar
•Organising Selling Tools
•Using High-Tech Equipments

58. Improved Customer
Accurate Evaluation of Sales force Personnel
Reduced Selling Costs
Better Market Coverage
Importance of Time Management

59. Territory Management
•According to Still and Cundiff, “Operationally a sales territory is a
particular grouping of customers and prospects assigned to an
individual sales person.”
•According to Maynard and Davis, “ Sales territory is a basic unit of
sales planning and sales control.”
•Sales territory is composed of a group of customers or a geographic
area assigned to a sales person.
•Sales territory may or may not have geographic boundaries.

60. Territory Planning Procedure
Selecting a Basic
Geographic Control Unit
Determining Sales Potential
Present in Each Control Unit
Combining Control Units into
Tentative Territories
Adjusting for Coverage
Difficulty

61. Establishing and Revising Sales Territories:
Reasons
1.To Obtain Thorough Coverage Of The Market
2.To Establish A Salesperson’s Responsibility
3.To Evaluate Performance
4.To Improve Customer Relations
5.To Reduce Sales Expense
6.To allow better matching of salesperson to customer
7.To benefit salesperson and company
8.To increase profitability of sales
9.To improve sales planning
10.To improve control on sales force

62. Bases of Territory Design
On the bases
of country
On the
Bases of
State
On the
Bases of
District
Units
Other
Bases

63. Kingsoft Office
Methods of Territory Design
Build Up Method
1.Determine Optimal Call Frequencies
2.Determine the Total Number of Calls Needed in Each Control Unit
3.Determine Workload Capacity
4.Draw Tentative Territorial Boundary Lines
5.Modify the Tentative Territories as Needed
Breakdown Method
1.Determine Sales Potential
2.Determine Sales Potential in each Control Unit
3.Determine the Sales Volume Expected from each Salesperson
4.Draw Tentative Territorial Boundaries
5.Modify Tentative Territories as Needed

64. Computers in Territory Design
•Geographic Information System (GIS)
–Combines multiple layers of information to provide in-depth
understanding of a sales territory.
•Elements of a complete GIS:
–Software
–Hardware
–Data
–Trained people

65. Assigning Salespeople in
Territories
1.Preventing from duplication of efforts
2.Opportunities should be equally divided
3.Should facilitate the effective control on
Sales force
4.Develop Healthy Competition amongst the
salesmen
5.Should provide proper and efficient routing
of salesmen
6.Should be flexible
7.Provide equal income to salesmen
8.Provide even coverage
9.Territories should be done on the basis of
demand
10.Should not be given independent charge

66. Routing Patterns
•Territorial routing is devising a
travel plan or pattern to use
when making sales calls to
efficiently cover a territory.
•A properly designed routing
system has three primary
advantages:
–reduced travel time and
selling costs
–improved territory coverage
–improved communication
(since managers know
where salespeople are)

67. •Before developing a routing plan, the salesperson
must determine the following:
•
the number of calls to be made
each day
•
the call frequency on each class
of customer
•
the distance to each account•
the method of transportation

68. ‘
5.
Outer-ring
approach
5.
Outer-ring
approach
4.
Hopscotch
pattern
4.
Hopscotch
pattern
3.
Cloverleaf
route
3.
Cloverleaf
route
2.
Circular
patterns
2.
Circular
patterns
1.
Straight-line
route
1.
Straight-line
route
Territorial
routing
patterns
Territorial
routing
patterns

69. Here are some types of routing patterns
1.Straight-line route
•Salesperson starts at the office and
makes calls in one direction until
reaching the end of the territory.
2.Circular patterns
•Salesperson starts at the office and
moves in a circle of stops until ending up
back at the office.

70. 3.Cloverleaf route
–A cloverleaf route is similar to a circular pattern.
–But rather than covering an entire territory, the route
circles only part of a territory.
–The next trip is an adjacent circle and the pattern
continues until the entire territory is covered.

71. 4.Hopscotch pattern
–The salesperson starts at the farthest point from the
office and hops back and forth calling on accounts
on either side of a straight line back to the office.

72. 5.Outer-ring approach
–The salesperson first draws an outer ring around the
customers to be called upon.
–Then, those customers inside the ring are
connected to the outer-ring route using angles that
are as obtuse as possible.

73. Sales Incentives
and Sales
Compensation

74. Compensation includes direct cash
payments, indirect payments in the form
of employee benefits and incentives to
motivate employee to strive for higher
levels of productivity

75. Objectives of Compensation Plan
Sales manager’s
Objectives:
1.Attracting the Best
talent
2.Devising Plan within
Cost Budget
3.Utilizing the at Optimum
Cost
4.Controlling Operational
Activities
Sales Force’s
objectives:
1.Acceptable Standard of
Living
2.Consistency In Income
3.Performance Linked
Incentives
4.Fair and Transparent
5.Timely Payments
6.Scope of Future raise

76. Types of Compensation Plan
Monetary Compensation
Straight Salary Method
Straight Commission Method
Combination of Salary and Commission
Non- Monetary Compensation
Promotions
Recognition Programs
Fringe Benefits
Travelling Expenses
Perks
Sales Contents

78. According to William J. Stanton, ‘ Sales
promotion is an exercise in information,
persuasion and influence.’

79. Categories of Sales Promotion
Consumer Promotion
Trade Promotion
Sales Force
Promotion

80. Characteristics and Applications of Consumer
Promotion

81. R
o
l
e

o
f

C
o
n
s
u
m
e
r

P
r
o
m
o
t
i
o
n
Increase Trial and Re-purchase
Increases the Frequency or Quantity
of Purchase
Countering Competitive Offers
Building Customer Database and
Increase Customer Retention
Cross-Selling and Extending the Use
of a Brand
Reinforcing the Brand Images and
Strengthening Brand Relationships

82. Characteristics and Applications of Consumer Promotion
Marketing Intermediaries
Impacts the Sales
Building Demand
Cooperative Marketing Activity
Boost Short-term Sales
Not for the Mass Public

83. Roles of Trade Promotions
Obtain Distribution
for New Products
Obtain Distribution
for New Products
Maintain Trade Support
for Established Brands
Obtain Distribution for
New Products
Encourage Retailers to
Display Established Brands
Build Retail Inventories
Obtaining Prime Retail
Shelf Space or Location
Enhancing Channel
Relationship
Reducing Excess
Manufacturer Inventories
Increasing Order Sizes
Countering Competitive
Actions

84. Sales Promotion StrategiesSales Promotion Strategies

85. •Promotion is a communication process by
which the producers of the products or
services draw attention of the consumers
or prospective consumers towards their
products and services

86. Below the Line StrategiesBelow the Line Strategies
•Price PromotionsPrice Promotions
•CouponsCoupons
•Gift with PurchaseGift with Purchase
•Competitions and PrizesCompetitions and Prizes
•Money RefundsMoney Refunds
•Frequent User/Loyalty IncentivesFrequent User/Loyalty Incentives
•Point-of- Sale DisplaysPoint-of- Sale Displays

87. Process of Sales Promotion Research
Desk Desk
ResearchResearch
Pre-TestingPre-Testing
Testing of Testing of
Sales Sales
Promotion Promotion
CampaignCampaign
Monitoring The Monitoring The
ResearchResearch

88. Planning and Designing Sales Promotion Programme:
Special Contexts
Sales Contest Trade DiscountsCoupons
Set an objective for
the contest
Evaluate Goals
Design Levels of
Achievement
Designate Prizes of
different types
Make everyone feel
like a winner
Track the progress
Set a time limit
Keep energy an
commitment high
Purpose of the
programme
Pay for
membership
Create a
membership form
Record all the
information
Decide the
promotional item or
service
Determine
distribution
Write essential
information
Give an ending date
Code the coupon

89. Setting Goals to Measure and Test Sales Promotion Setting Goals to Measure and Test Sales Promotion
EffectivenessEffectiveness
Exposure:
Define Target Customer
Determine their numbers
Choose the Promotion Media
Determine the Promotion Budget
Attention
Attitude Change
Comprehension
Behaviour/Action:
Buy the Brand for the first time
Continue to buy the brand
Buy more of the brand
Urge friends to buy brand
Visit a store
Try out a brand