Factors changing sales management and sales

Factors changing sales management and sales

Since the late nineteenth century, salespersons have adopted several marketing strategies to make contact with their customers. Some of these techniques are rather easy to implement while others are complex, and the salesperson may face several difficulties while using them.

Until fifty years ago, there were only four basic techniques that were used by companies for sales purposes. The four basic techniques are; stimulus-response, mental states, which need satisfaction and problem-solving. About twenty-five years ago, another method rushed into marketing, and the majority of the sales organizations started using it. This technique has named ‘consultative selling.’ These five sales techniques are widely used by companies to interact with prospects and customers. The marketing process has based on approaching a chance who can be a potential customer. Then using a series of processes including appointments and contacts with those prospects and then ultimately following a proper sales process to generate sales.

Factors changing sales management and sales

It is a well-known fact that the process of selling and marketing is changing at a rapid and considerably significant rate. Nowadays, market forces have joined internal pressures of business to make sales forces better and useful in all the business sectors. According to several marketing experts ( Ahearne, Lam, Methieu and Bolandar, 2010, Evans, McFarland, Dietz and Jaramillo, 201), techniques used for sales purposes in the past can not work in today’s advanced marketing field.

Another factor that has compelled business owners to change their behaviors is higher expectations of buyers about the quality of products and services. That is why companies are using techniques that have based on the customer’s interest in selling purposes. Three significant factors have played a sufficient role in the evolution of the sales market. These are expectations of buyers about quality; new horizons opened by advancement in technology and a higher level of competition among companies due to globalization of markets.

New customers’ Demands and Behaviours

There has been a sharp change in business to business (B2B) markets during the last few years. Customers’ trends have seen to be towards getting more and more savings and value by using the process of supplier segmentation and other procurement techniques.

Procurement is a technique that has based on customers’ business plans with intentions of getting more profit, stabilizing cost, and approaching the best shareholder value for contribution. Nowadays, the buyer’s demand for value is not only confined to product and service. The buyer also demands an amount in mutual relationships between the company and him. Customers also try to settle on the best possible terms and conditions.

Similarly, the value creation process by companies for customers has also undergone a considerable change. In the past, the value would create through an already determined product or service. The process had a flaw in it as the product or service would undergo commoditization and end up with less quality and value. To solve this issue, companies have adopted a technique in which suppliers and customers interact with each other to create the cost of any product or service (Visio and Gro rooms, 2014). Many marketing companies make efforts to devise a mutual collaboration process with customers. It has become a trend where strategic prospects are involved in the Sales Process (Hakanen, 2014).

As the hold of buyers is increasing, they have started making higher demands (Herbst, Voeth, and Miesla, 2011). Two main things elaborate on the change in the mutual relationship between supplier and customer. First is access to more information about products and services by the buyer. Second is the gain of buying power by some customers due to the globalization of business.

Latest Communication and IT

Due to a considerable evolution of the information and communication sector in the last few decades, there also seemed a noticeable change in the operations of sales companies. In the past, the description and quality of specific products and services had only found from the salesperson. But due to a large-level advancement in the informational sector, a buyer can access information about the value and quality of any product (Maklan and Knox, 2009). social media and analyzing techniques have increased much the insight of a customer (Arnett and Badrinarayan, 2005). These advancements have not only benefited the customers but also have allowed sales organizations to know the trend of customers towards specific products and also information about the customer. Investment has become more reliable, and salespersons have considered as knowledge (Verbeke, Dietz and Verwaal, 2011). The salesperson can know the needs and wants of customers and can boost their organization’s sales by providing relevant information to customers. Hence, advancement in technology has enabled the development of sales. The quantity of knowledge about customers that a salesperson has is a mark to identify the sales’ performance (Sharma, Levy, and Evanschitzky, 2007).

Consultative selling as a value-added selling

An essential prerequisite for gaining value is to have in-depth knowledge about customers. This thing helps suppliers to boost the sales process. As cost is the most critical component in sales, a great understanding of customer and its internal relations help increase the value of transactions. The success of a sales process not only depends upon meeting the present needs of customers but also on the solution to their future problems. Sales gurus of different companies have told that the success of a business is directly dependent on their capability of discovering new solutions to the future issues of their customers. Knowledge of sales, which has based on knowing well about customer’s intentions, has proved to be the essential factor of the sales process (Verbeke et al. 2011), as only with in-depth knowledge about customers, a healthy and productive conversation is possible. To gain a thorough understanding is neither so easy nor so quick. Salespersons need to be more serious about knowing the insights of customer organizations. Mutual customer-supplier meetings have required to create a novel value hypothesis and to advance the current ones.

The main idea of this thinking is that salespeople should know more about the customer’s intentions rather than his product or services (see Megnuc, Aun, and Uslu, 2013). the most critical factor that determines the professionalism of a salesperson is the extent to which he uses strategies to arrange meetings with customer organizations. However, the nature of the relationship between customer and supplier is continuously undergoing a phase of change. First of all, business companies are re-evaluating the different methods for meeting customers and also the time duration of those meetings. It helps in keeping a balance between customers of every nature.

In the upcoming future, there is going to be a need for a perfect salesperson who is not only good at organizational and product knowledge but also possesses a high-quality understanding of how to use techniques and tools in customer management.

Academic theories and studies have shown that the gap between transactional and consultative selling has widened in sales companies. The thing to question is how the companies respond to such a polarized state between transactional and consultative selling. The difference between the two selling approaches is that transactional selling is the name of serving customers by lowering the product cost. In contrast, consultative selling focuses on the creation of value between customers and suppliers.

Studies and experiments have shown that companies should discover new opportunities if they want to thrive for a long time in the market (see Benner and Tushman, 2015). The exploitation process requires regular and constant processes to gain higher productivity and raise efficiencies. Exploitation has a higher risk of failure hidden in it and also a higher chance of success(March 1991). The companies that implement both exploration and exploitation are called ambidextrous (O’Reilly and Tushman, 2013).

Consultative Selling Process

The process of selling products in the form of partnership in which long-lasting value and relationships have built among customers and suppliers is called consultative selling. Those who follow consultative selling, take customers as prospects. They deal in the same tone with customers before and after selling the product. The consultative sellers do not consider their work ‘done’ once the contract is signed; instead, they serve well even after the customer bought the product or service.

There are four significant steps that the seller should follow to become consultative.

1. The understanding financial position of customer
2. Devising the most profitable solution to customer’s problem
3. Taking whole responsibility for a project and working responsibly to solve the issues of customers
4. Making a good relationship with the customer while applying problem-solving techniques

Taking the following details from a prospect is also essential in this regard:

1. Prospect’s purchasing process
2. Prospect’s strategy of sourcing
3. His standards while selecting a supplier for himself
4. Prospect’s purchasing power
5. References of his sources

Purchasing Process of Prospect

It is as much important as the knowledge of potential buyers in a company to know about the supplier-selecting time of buyers. The whole process can make up of the following steps:

1. Pointing out the need
2. Specifying the requirements
3. Knowing about the products or services of need
4. Complete knowledge about the companies having those products or services
5. Meeting with potential suppliers
6. Shortlisting the supplier companies
7. Absolute go through of the proposals and tenders
8. Dealing with suppliers about problems/pricing
9. Selecting a better supplier
10. Making a contract with a supplier
11. Availing the products or services

Making a sale depends upon the gained details. The best way to make selling is by following the above process at the initial stage of contact with customers.

Prospect’s Sourcing Strategy

Prospect may use one of the following techniques as a sourcing strategy.

1. Worldly Sourcing
2. Partnership Sourcing
3. One-Source strategy
4. Preferred seller strategy

Every one of the above methods has flaws in it. But partnership sourcing is somewhat more beneficial as it requires a contract of customer and seller for a long-lasting relationship. The advantages of partnership sourcing include:

1. Increase in the development of product
2. The gain of higher quality
3. The solution to existing marketing issues for future use
4. A considerable economic Share in design and other costs

Process

Knowing about the prospect’s selection process is of much significance, and it is essential to make it the part of above defined new qualification criteria. If it has observed that the buyer’s selection process is uncatchable, the supplier should choose whether to suggest a prospect to re-make the selection procedure or to remove his own company from the process.

Commonly buyer follows below-given steps to select a supplier

• The record of service or product
• Qualification and experience of the supplier company
• Any mismatches in interests
• Ranking of public opinion about the company
• Timing
• The extent of making the relationship
• Nature of references
• Strategic match

It is essential to know about the selection procedure of a prospect. In case, if the buyer tells that he has no selection standards, the supplier should help him devise it.

Purchasing Power

Different prospects have different levels of purchasing powers that influence the marketing of suppliers. A customer/prospect may make an impression on a supplier by showing the extent of knowledge he has about the market such as;

• Proper know-how of the market
• The working diameter of the company
• Share of the company in the market
• Nature of work they provide the knowledge of supplier companies strategies
• Use of different rankings and public opinions about the company
• Total suppliers are bidding for their projects.

Sellers need to know about the type of purchasing power a buyer has and then proper accommodation of that power in company strategies.

Buyer’s Source of Reference

Buyers or prospects often have some medium through which they gain information about the market. This information affects the buyer’s decision to choose a particular supplier. The right supplier always has some influence on the media of the buyer. He gives as much of the following information to the sources of reference of the buyer as possible;

• Already present suppliers
• Record
• Direct contact through brochures and mails
• Trading magazines
• Publicity
• Seller directories
• Online platforms like websites
• Seminars and exhibitions
• The professionalism of selling company
• Third-party advisors

Four purchasing modes

There are four different means of purchase, as devised by Miller/Heiman. Suppliers should know which method in the satisfied customer is

1. Trouble; customers in this mode are easily approachable, and it is straightforward to sell products to them.
2. Growth; in this mode, those customers are included who are looking for better, faster, cheaper, and easier to access products or services.
3. Even-Kneel, the customers in even kneel, is somewhat challenging to handle. More proficient and efficient sellers are required to sell products to them.
4. Overconfident, these buyers have proved to be the real test of a supplier’s efficiency. It is the most challenging task to handle and sell products to them. But suitable suppliers do not cut communication with them instead of trying to build relationships with them.

Buyers as partners

Every supplier wishes to find customers who not only buy his product but also work as a publicity maker of his product and service. Such customers although not common but can be found by following some easy steps such as;

• Providing better products or services to customers
• Working at the maximum level of expertise and excellence
• Taking feedback from customers and try finding errors they face

Managing Expectations

Not handling or meeting the requirements or expectations of buyers is probably the most common reason behind the failure of many companies. Suppliers should have proper knowledge of the buyer’s expectations and should try to meet those requirements or expectations.