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CHAPTER

16 Personal Selling
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Key Points in This Chapter

1. How does personal selling work, and what are its objectives?
2. What is the personal selling process?
3. How is personal selling managed? And how does it relate to an IMC program?

Chapter Perspective

Lesson from High-Powered Salespeople

When you look back through history, you see many significant changes brought about by individuals such as
social activists Mahatma Gandhi, Susan B. Anthony, and Martin Luther King Jr.; spiritual leaders such as
Mother Teresa; and political leaders such as Abraham Lincoln, Nelson Mandela, and Winston Churchill. All of
these individuals were great communicators who knew how to motivate others and changes behavior. In the
highest sense, they were doing “personal selling.”

Some historians might say that calling these historical figures “salespeople” is insulting because they
“sold” ideas rather than goods and services. Nevertheless, selling an idea---getting volunteers, votes, and
donations—is a form of high-powered personal sales. It is personal because the success of the sales effort often
depends on personal on-to-one contact, and such efforts are almost always enhanced by an individual’s
integrity, credibility, and passion.

Unfortunately, over the years the personal selling of goods and services has become associated with
manipulation and high-pressure tactics. Although some people still use these practices, today’s professional
salesperson usually realizes that partnering with customers and situation is the most effective personal selling
strategy.

Although the historical figures mentioned above didn’t “sell” for financial gain (as most salespeople do),
their success stemmed from their passion for what they believed in, their ability to understand their audiences,
and their ability to communicate and persuade. That passion and those abilities lead to the successful selling of
goods and services, as well as causes.
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AVON’S MARK MIXES BRAINS AND BEAUTY

“Ding Dong! Avon Calling.” Avon’s famous slogan is now reaching a new youngers audience. The world’s
largest personal seller of beauty products, Avon, has long been identified with middle-age women and
homemakers. Avon’s newest line of “Mark” makeup.

The Make line—marketed separately from the regular Avon line to maintain the Avon brand for its loyal
customer—strives for a hip, modern image, one that can compete with and appear more sophisticated than
Cover Girl. The line is priced a little higher than the regular Avon products but is still competitive with
drugstore brand. The same Mark refers to the brand’s position as a product designed to help young women
“make their mark” in the world. In addition to cosmetics and skin-care products, the line includes bath and body
products, fragrances, fashion jewelry, and accessories in sophisticated packaging.

Avon’s biggest problem in reaching this target audience is its own dated image, associated with mom
and grandma, which is real turn-off for hip young teens. Indeed, the Mark line might not be able to escape the
image of its famous parent.

The Mark Education

To sell Mark and educate a new generation of sales representatives. Avon has created new personal selling
program for young women ages 16 to 24. Partnering with the University of Phoenix, Avon has integrated an
innovative sales force training program into the launch of the Mark line. New Avon salespeople who complete
an online sales training course will receive college credit from UoP, which specializes in providing practical
education for working adults. By positioning Mark as an educational experience, Avon helps to allay parent’s
concerns about their daughters abandoning their studies in order to “play around with makeup.”

Avon says 13,000 young women initially contacted the company about enrolling in the Mark sales
training program. The company hopes eventually to enroll some 500,000 young sales reps in the United States.
About 17 million young women in the United States are in that 16- to 24-year-old demographic, and Avon’s
research has found they spent more than $24 billion annually on beauty-related products.

Avon’s research has also found that a typical Mark representative has an average of 13 to 21 young
women friends. That means the direct-selling channel for the first year would be around 10.5 million.
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Mark’s Selling Tools

The primary MC tool is the meet mark catalog, with graphics, format, and magazine-style articles designed to
reflect the brand’s spirited and goal-oriented personality. Like the traditional “Avon ladies.” Mark sales
representatives hand out catalog when they make a sales call, rather than mailing them. Avon publishes some 10
million of the large-format catalogs in English and Spanish every six weeks. This makes meet mark, described
as a “megalog” the largest publication reaching this young female audience. In comparison, Seventeen, the
biggest magazine aimed at teens, reaches only 2.4 million.

Avon hopes its new sales force will sell the products among groups of friends as slumber parties and
other informal gatherings. Beauty rituals such as shopping and learning how to apply cosmetics have long been
an important way that teenage girls relate to one another. Avon believes the allure of the products, plus the fun
of the parties, will make selling Mark a more attractive opportunity for female teenagers than working behind a
fast-food counter. Said Deborah Fine, the former publisher of Glamour magazine who was tapped by Avon to
launch the Mark line and run the new Avon Future division, It’s lip gloss with an earning opportunity.”

The Mark line will be supported not only by personal sales calls but by advertising that will run on
youth networks including MTV and WB and in beauty magazines such as Allure. Avon is also creating
partnership programs with automakers and telecommunication and entertainment companies that will distribute
samples and advertise in the Mark catalog. For other forms of interactivity, the effort is facilitated by a toll-free
number (1-800-meetmark) and a website (www.meetmark.com).

An integrated recruitment campaign targeted to young women at colleges, high schools, shopping malls,
and other youth-oriented venues was used to recruit Mark’s sales force. In addition to events, the recruitment
effort used advertising and other forms of direct marketing to young women. Mark representatives also receives
incentives for recruiting other young women.

Mark’s Vision
Deborah Fine explains that “Our vision for ‘Mark’ is to provide young women with an engaging product line, a
direct-selling opportunity, and a unique brand experience that engages them in a world of community,
participation, and empowerment.” The phrase “Meet Mark,” will be the invitation to both buyers and sellers to
enter this new world of beauty and opportunity.

Mark has another educational mission: to teach financial responsibility to the young businesswomen.
Instead of buying the product line on credit in advance of sales, as regular Avon salespeople do, Mark
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representatives will encourage to sell the products and solicit the money from friends in advance. They then
place their orders online, using their personal credit cards; they won’t be extended credit. Avon says the
arrangement is intended to keep the process simple; however, it is also designed to teach account balancing and
to prevent novices from getting into trouble by ordering more products than they can sell.

The Mark line will eventually join the regular Avon product line as part of Avon’s global effort. Avon is
marketed in 143 countries through 3.5 million independent sales representatives who produce approximately
$6.0 billion in annual revenues. Andrea Jung, Avon CEO said, “Around the world, the name ‘Avon’ stands for
aspiration and empowerment. We look forward to engaging young women on a global scale with the Avon
earnings opportunity.” The effort also will take this innovative integration of education and sales force training
around the world.

Source: “Mark Is What You Make It.” Avon Mark website, <www.meetmark.com> ; Sally Beauty, “Avon Tries
Knocking on Dorm Doors,” Wall Street Journal, March 28, 2003 p. B2; “Avon Makes Its Mark,” Fashion
Windows, March 30, 2003, <www.fashionwindows.com/beauty/2003b/ avon.asp> ; “Avon Unveils New Brand,
Strategy for Global Business Reaching Young Women,” October 27, 2002, New.Com; “Avon Creates Line It
Hopes Teens Will Buy and Sell,” <www.cnet.com/investor/news/newsitem/0-9900-1028-20550771-0.html>;
Business, October 2002, <www.responservice.com/archives/oct2002_issue2/business/internat.htm> .

PERSONAL SELLING: THE PRIMARY TWO-WAY

MARKETING COMMUNICATION FUNCTION
Everyone does personal selling. Children sell lemonade, magazine subscriptions, and Girl Scout cookies.
Students sell prom tickets and yearbook ads. Doctors “sell” exercise and diet programs to overweight Patients.
Lawyers “sell” briefs to skeptical judges. The fact is, personal selling is person-to-person interactive
communication used to ultimately persuade. It is the oldest marketing
communication function (see Exhibit 16-1)

The role of personal selling varies by type of business and

industry, by the nature of the product or service, and by the business
strategy. In B2B product categories, personal selling is one of the most
important communication functions. In B2C business, it is often the
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primary MC function used for high-ticket goods and services such as cars, insurance, real estate, and financial
services. Personal selling is also used in some retail stores, such as in department stores’ cosmetic departments.

Total spending on personal selling is estimated to be close to the amount spent for all the media
advertising—over $200 billion. Because personal selling is such am important function, salespeople are often
some of the highest-paid employees in a company.

Today’s professional salesperson is support by information technology and the understanding that
creating a good relationship will result in more sales than will the manipulative, hard-sell techniques of the past.
Two-way communication, the essence of personal selling, is used to uncover customers’ needs and wants and
address misunderstandings and objections. In addition, good personal selling today provides product expertise
and follow-up service to a transaction and, most important, helps customer to be more successful-that is, it
creates value for them. As table 16-1 shows, personal selling has evolved over the years from focusing on
persuasion to creating value through partnering with customers.

Professional salespeople represent one aspect of a total marketing communication organization, and they
therefore must conduct themselves in a way that is strategically consistent with all the other brand messages.
Where personal selling is used extensively, the salesperson is the company in the eyes of customers and
prospects.

TABLE 16-1 Evolution of Personal Selling

Sales Era, Marketing Era, Partnering Era,
Before 1960 1960-1990 after 1990
Communication objective Making transactions Satisfying needs Building relationships

Source: Barton Weitz, Stephen Castleberry, and John Tanner, Selling (Burr Ridge, IL: McGraw-Hill/Irwin,
1995), p. 12. Reprinted by permission from The McGraw-Hill Companies.

How Personal Selling Works

Personal selling’s primary role is customizing brand messages. Generally speaking, MC functions such as
advertising, events and sponsorships, and brand publicity can create brand awareness and knowledge. But
personal selling, integrated into the MC mix, can customize brand messages on a customer-by-customer basis.

In personal selling, a salesperson asks many questions of a prospective customer in an effort to understand
how a product could benefit that customer. During the dialogue, the sales person can gauge how the customers
is reacting to a product offering. If there are misunderstandings, the salesperson can immediately clear them up.
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If the prospect does not like certain aspects of the product offering (price, credit terms, delivery schedule), the
sales person can address these concerns and perhaps negotiate a solution. This two-way interaction- and the
instant customer gratification it can bring- is what makes personal selling the most powerful MC function a
company can use.

Acquiring New Customers

Average annual customer turnover rates are approximately 15 to 20 percent, so salespeople must work
constantly to acquire new customers to replace those lost. Acquiring new customers at a faster rate than the rate
at which current ones leave the brand is one way to increase overall sales. The problem which acquisition,
however, is that more time must be spent locating potential new customer (or prospects), (e.g., prospecting),
than actually making the sale. Sometimes a salesperson may rely on a list (members of organization, for
example). Other marketing communication efforts, such as direct response or advertising, may be used to locate
prospects and motivate them to raise their hands as being in the market for a product by contacting the company
in some way. A sales lead is a person or organization identified as being a prospect-someone able to benefit
from the brand being sold.

However, in many situations prospective customers don’t contact the company. Instead, the salesperson must
contact them- either acting on some information that identifies individuals as prospects or making contact
simply because people’s names appear on some list. That’s what door-to-door salespeople do when they sell a
product or service in a neighborhood, and it’s what telemarketers do when they make their phone calls. A sales
call to a prospect who is not known by the sales rep and has not expressed any particular interest in the
company or brand is known as a cold call. Called-calling is one of the most difficult forms of personal selling
because there is no reason to believe the prospect may resent or be hostile about the intrusion.

Retaining Current Customers

A company’s current customers must not be taken for granted. Just because they have been buying from a
company for years, there is no guarantee they will buy from the company next week. As noted, from 15 to 20
percent of customer’s turnover each year-that is, they leave one brand from another.

Unfortunately, many businesses overemphasize acquiring new customers at the expense of servicing current
ones. Marketing communication agencies themselves do this. Top managers- those most responsible for
building their agencies- often spend the majority of their time doing personal selling to get new accounts. Once
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they sell a company on becoming a client, and they (top managers) go off to do more personal selling. (They are
likely to work on current account only when the client is dissatisfied and threatening to switch agencies.)

Because customer retention is at the heart of a brand relationship, salespeople must do things that not only
create but maintain the relationship. A salesperson’s number-one personal objective should be to create trust.
He or she accomplishes this by demonstrating dependability, competence, a customer orientation, honesty, and
liability. Some sales managers say that current customers should always be treated as new customers- receiving
the same level of attention and care as prospects.

As in all areas of IMC, sales people must create and manage customers’ expectations- expectations not only
of product performance but of all the services in support of a brand. After closing a sale, the salesperson should
make sure the product arrives on time, that invoicing is properly handled, and that the customers knows how to
use the product in the proper way. In B2B situations, the salesperson should be analyzing the customer’s
business to see in what ways the band can further improve the customer’s processes, sales, and profit.
Salespeople are often invaluable information resources to their clients. Because they know how other
companies use their products, sales people have a much broader perspective on the product’s applications than
any single customers can have. They can add value by not letting customers repeat mistakes made by the
customers, as well as by sharing ideas that work (as long as those ideas are not proprietary).

Personal Selling Objectives

You might think that when it comes to setting objectives for personal selling, the main objective would be quite
simple: to tell all that you can. After all, the bottom line of personal selling is sales. Though hard to argue with,
this objective doesn’t give much direction from a communication standpoint to help ensure that the selling
effort is focused and cost-effective. In personal selling a sin every other MC function, specific objectives are
needed that reflect the salesperson’s efforts at every step in the selling process, and these objectives should be
driven by a SWOT analysis.

Avon’s personal selling objectives for the mark line were:

-To broaden the Avon market by reaching a younger female audience.

-To create a hip band identity for the new Mark line.

-To sign up a core group of young saleswomen.

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-To identify prospective customers (and additional sales staff) from within the sales representatives’ pool of
friends.

Other typical and more measureable objectives for personal selling are:

-To increase distribution to 75 percent ACV (all commodity volume).

-To make sales calls on x number of prospective customers each month.

-To identify y qualified sales leads.

-To call on z current customers’ business by 5 percent.

-To have product featured in major retail accounts’ advertising four times a year.

-To have each account (retailer) that carries the brand carry at least three or more varieties.

Personal Selling Strategies

One of the most successful personal selling strategies is helping customers solve problems or take advantage of
Opportunities, which is called solution selling or enterprise selling. Too often, salespeople-by nature outgoing,
gregarious, and aggressive-become so focused on making a sale that all they talk about is their product’s
features and benefits. The best sales people, however, motivate prospects to talk about their businesses and the
problems they are having or the opportunities they have not yet been able to take advantage of. Needs
assessment, asking a lot of questions about how a business operates, accomplishes this.

The solution approach to selling focuses on the customer’s needs and problems, then shows how a company’s
product can meet those needs and provide a solution for those problems. In high-tech industries, solution selling
often involves integrating the sales and engineering functions to come up with new systems or customizing
software to fit the customer’s needs. Another personal selling strategy is to work with prospects and customers
as business partners.

A partnering strategy requires that salespeople learn as much about their customers’ businesses as they know
about their own. A good example of this was Ed, a salesperson with whom this author once worked. Ed was a
sales man for a processed meat company and was responsible for selling to a division of Kroger. He often
frustrated the company’s marketing department because he refused to present all of the promotions that the
department developed. He presented some, but not everyone, because he understood Kroger’s needs and
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objectives so well that he knew that was good for Kroger and what was not. He didn’t waste the chain’s (or his
own) time by trying to sell products and promotions that didn’t fit Kroger’s business plan. As a result, Kroger
trusted Ed so much that he wasn’t often invited to review competitive presentations being made to Kroger. He
had developed a partnering relationship based on trust. In the end, Ed was one of the top salespeople in the
company.

EXHIBIT 16-3

In this ad, the

engineering firm Black
& Veatch promotes its
ability to help its client
companies solve
problems relating to
water and energy.

A partnership starts with

a working relationship
between senior managers on both the marketer’s and the retailer’s sides. Dedicated retail marketing teams
(located close to key retail accounts in the field) become focused on understanding and meeting the marketing
objectives, strategies, and challenges of these key retail accounts. Major marketers, such as Kraft Foods, Procter
& Gamble, Levi’s, and Nike, operate this way.

Often a field marketing team supports the sales force by developing marketing communication plans tailored
specifically for major retailer customers. These plans include account-specific sales and communication
objectives as well as strategies for product mix, on-floor merchandising and POP displays, retail advertising,
and tie-in events between the manufacturer and the retail chain.
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Good salespeople function as a liaison between a company and its customers. Often they sell as hard inside
their own company as they do outside, to convince their company to make product and process changes that
would best serve their customers. Evidence of such customer focus may result in company executives asking
salespeople, "Who are you working for, us or the customer?" The correct answer is "Both."

An important relationship strategy in the sales area, particularly in B2B product categories, is entertainment.
This is another instance in which personal selling and trade promotions come together. In addition to sales
representatives taking customers to dinner, to baseball games, and on other outings, many large companies have
lodges and yachts in which customers and prospects are entertained. The budget for personal selling of one
major packaged goods manufacturer, for example, includes $3 million for entertainment and $2 million for
gifts.

As discussed in more detail in Chapter 19,one reason why companies sponsor race cars, golf and tennis
tournaments, and other events is that these provide a special entertainment opportunity to reward good
customers and motivate prospects to become customers. Companies that are sponsors can take customers
behind the scenes of these events to meet the celebrities, which is a special privilege.

An increasingly important personal selling strategy involves knowing a customer's history of interactions with
a company. The use of this strategy is greatly enhanced by technology-specifically by customer relationship
management software(↩️ Chapter 3).

Customer Relationship Management and Personal Selling

One of the technologies widely used by sales forces is customer relationship management. CRM is helpful in
personal selling in two specific areas. First, it provides individual salespeople with an automated system for
organizing sales leads, developing sales presentations, making sales presentations, processing orders, and
recording customer's concerns and agreed-upon next steps. Second, having all this information in databases
means that it can be easily shared with appropriate departments in the company (production, distribution,
marketing, customer service and accounting) and that customers are integrated into the company and customer
data are integrated into the MC process. How customers respond to sales offers, their questions and concerns,
and what they buy and don't buy are three examples of the valuable information that helps companies
communicate with customers.

A survey that asked U. S. marketing executives how they would spend the majority of their MC budget if it
were unlimited reveals the importance of CRM. The highest response was for CRM (28 percent), followed by
mass media advertising (22 percent); sales promotion and public relations tied at 12 percent.
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Because speed is so important in business today, a sale is easily lost if a company spends too much time
putting together an offer. Providing salespeople with laptops and modems to access relevant databases can
significantly improve the efficiency and effectiveness of the typical sales call. In essence, CRM makes
salespeople more productive communicators (see Exhibit 16-4). A salesperson using CRM can sit in a
customer's office with a laptop computer, input that customer's needs, and, with a modem, access company
databases to determine product design alternatives, product availability, prices, discounts available based on this
customer's past volume, the customer's line of credit, and delivery schedules, among other things. Before
leaving the customer's office, the salesperson is able to
configure a customized product offering. Being able to do this
type of communication quickly and accurately is an added
value to customers and therefore a way to be more
competitive.

IBM, a major provider of CRM software that provides this

capability, has gone so far as to reposition itself as the
"eBusiness" company (e-business should not be confused with
e-commerse,which is more narrow and relates primarily to
online selling.) As IBM's ad explains, "eBusiness" integrates
many operations.

CRM can also manage customer leads and allow sales force
managers to make sure salespeople are doing their jobs. By
tracking leads and sales calls, and by keeping customer and
prospects profiles complete and up-to-date, CRM enables a
company to

• Know which leads were followed up and when, and what the
results were.
EXHIBIT 16 – 4
• Give the leads that were not followed up to other salespeople, if appropriate.
In this ad, SalesLogix
• Determine why sales were not made (for example, a better competitive offer, touts its CRM solutions
designed for midsize
dissatisfaction with a brand's current products or services, delivery not soon
B2B marketers.
enough).
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• Determine who within the prospect company has influence on the brand decision.

• Keep track of buyers who leave one company and go to another.

THE PERSONAL SELLING PROCESS

Personal selling, whether to acquire new customers or to sell additional products to current customers, involves
generating and qualifying leads, making sales calls, identifying and responding to objections, closing the sale,
and following up to build and maintain the customer relationship.

Generating and Qualifying Leads

Through generating and qualifying sales leads, a personal selling operation can segment and target its market.
Sales leads may come from a company's direct-response advertising or from publicity about the company or its
brands. They include individuals who call in for information or return a business reply card from a direct-mail
piece or a "bingo" card from a trade or special-interest magazine (see Exhibit 16-5). Leads may also come from
referrals-satisfied customers, employees, even competitors who feel a prospect is either too big or too small for
them to handle.

When Hewlett-Packard (HP) wanted to motivate corporate customers to upgrade their equipment, the company
segmented them by the volume of their previous purchases and then by the job description of the buyers for
each of the companies. Specialized mailings were sent to people in each segment, who were then contacted by
phone. The calls determined who was most likely to upgrade; those leads were sent to regional sales offices for
personal follow-up.

Another way to generate leads is by getting prospects to self-select, as described in Chapter 7. When a
customer takes the initiative in expressing interest in a product and providing profile information, that behavior
can be highly predictive of future buying, as shown in Table 16-2. Sending brand messages by means of mass
media and niche media motivates those interested to identify themselves. Offering premiums can encourage
prospects to provide profile information so that a salesperson can decide whether they are true prospects.

Managing lead generation sometimes requires mediating the interaction of salespeople and marketing
departments, because these two groups often disagree about leads. Marketing often sees a lead as anyone who
inquires about the product, while sales defines a lead as someone ready to buy. Marketing people complain that
salespeople don't follow up on their leads, and salespeople reply that many marketing-generated leads aren't
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worth following up. The heart of the problem is that each

“Our Conversation-to-lead ratio
department wants the other to qualify the leads (see Table
was extraordinary high because
16-2).
we were talking to the right
Once leads are generated, they need to be qualified to people with the right message.”
determine whether they are genuine prospects. Qualified
leads are prospects who seem most likely to buy because of some information that is known about them.
Qualified leads are persons who (1) have a real need or opportunity that the brand can address, (2) have the
ability to pay for the good or service, (3) have the authority to buy, and (4) are approachable. A company or
person who buys infrequently or demands an unreasonably high level of service may not be a good lead. In the
case of estate planning, for example, marketers try to qualify incoming leads by including in the invitation to a
seminar a line such as "If your household income is more than $125,000 a year, you can benefit from estate
planning." They hope that people who may think they want or need estate planning but don't have the wealth to
justify it will not waste the time of the company offering the seminar.

When General Motors introduced its first electric car, it required all potential customers to fill out a customer-
profile application before a sales representative would meet with them. GM wanted to target those who were
environmentally conscious, already owned at least two gasoline-powered cars, and had a household income
over $120,000 a year. Not all products are for all people, and potential customers should be assisted in deciding
whether a particular product or brand is for them. Exhibit 16-6 is an ad with a return-mail card whose purpose is
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to generate leads that can be contacted and further qualified.

TABLE 16 – 2 Making Strategic Use of Customer Contacts

According to search:
60 percent of all inquirers purchase something within a year.
20 percent of inquirers have an immediate need.
10 percent are hot leads.

60 percent of inquirers also contact your competitors.

50 percent of all new business starts as an inquiry.

But most companies do not take advantage of these inquiries:

20 percent of inquirers never receive information.

40 percent of inquirers receive information too late to use it.

70 percent of inquirers are never contacted by a sales representative.

Source: Arthur M. Hughes, The Complete Database Market (Burr Ridge, IL; McGraw-Hill/Irwin, 1996), p. 390
Reprinted with permission from The McGraw-Hill Companies.

Qualifying sales leads is so important because the cost of a personal sales call exceeds the cost of most other
company-initiated brand contacts. Although the number varies greatly by product category, the average B2B
sales call costs about $500. This figure includes the costs of getting to and from each
customer(hotel,meals,entertainment, and transportation) plus salary and commission. In some product
categories, such as local media sales, a salesperson can visit a half dozen customers a day, making the average
cost per call about $50. But a person selling

EXHIBIT 16 – 6

In this magazine ad, Ryder Transportation Services explain how the company’s service are being used by Ace
Hardware. A reply card is tipped in (glued) to the ad to make response easy. When the cards come in, they are
used to qualify the sales leads for Ryder’s sales force.
 529

It’s time you got to know us on a first-name basis.

Find out how the people at Ryder can help your company save time and money – in
practically no time. Return this card today.
o Please send me my free information kit.
o Please have a Ryder representative call me for a free consultation.

Name Title

Company Name

Street Address City State Zip

Business Phone Best time to call

Call 1 800 RYDER OK, ext. 612
www.ryder.com

airdot radar systems may travel halfway around the world the to make one sales call, which could cost company
$10,000. Because the average sales call is so much more costly than using advertising or even direct-response
marketing media, it is seldom cost-effective for salespeople to make cold calls. Even when a company has a
new product, the company’s current customers – who are usually the first group of prospects because they
already know the company-must be qualified in order to avoid wasting personal selling time.
In B2B marketing, qualifying leads is especially important. The fact that it takes between three and
seven personal sales contacts before a major B2B sale is made means a salesperson may have to make several
expensive sales calls before closing a deal. The higher the quality of a lead is, the fewer the visits that are
required before a prospect responds. The quicker the response rate is, the lower is the cost per sale.
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Making the Sales Call

The sales call occurs when the sale presentation is made. The extent and formality of this presentation varies
greatly, depending on the offer itself and the relationship between the salesperson and the prospect. Sales
presentations can occur during a visit to a prospect’s home or office, or during a group meeting, such as the
Avon Mark parties. Generally speaking, the more expensive the product offer is , the lengthier and more formal
the presentation will be.
In some situations, personal sales calls are made by phone by a company’s inside sales force. (This type of
selling is different from telemarketing, explained in the next chapter, because these are not cold call.) Inside
sales are salespeople who regularly call on accounts whose
EXHIBIT 16 – 7 average size orders are not large enough to cost-justify an in-

This sales kit for the American Dairy person sales call. The initial sales call on these accounts may be
Farmer’s retail marketing program includes made by a personal sales rep, or the prospect may respond to an
a welcoming letter, a sales video, a CD with
ad or direct – email piece. The follow-up calls are made by the
TV and radio ads, as well as logos and other
photographs and graphics. In the pocket on inside sales department. In some cases members of an inside sales
the left is a program overview with force call on the same customers for years and become very good
promotional dates, reminder postcards,
friends although they never meet face-to-face.
and a plastics newspaper wrapper that
includes a cheese description “slide rule.” Providing current customers and prospects with an appropriate
and accurate sales presentation is critical. Successful salespeople
script and practice their presentation to make sure they have the key
information on the tip of their tongues. Companies often provide sales
literature, such as the cheese sales kit in Exhibit 16-7, to help the
sales rep make the presentation. Sales literature may include videos,
charts with data and documentation, planning forms to work through
with the customer, catalogs, and demonstration materials. Inside
salespeople often refer their customers to the company’s website for
pictures and other visual demonstrations of product. Good
presentations are interesting, keep the attention of prospective
customers, and lead them through their decision process to the point at which they are ready to buy.
In solution selling, the sales representative explains how the brand can help the prospect either solve a
problem or take advantage of an opportunity. The presentation should be as much about the prospect as about
brand being sold. All of the details of the offer-such as price, delivery schedule, credit terms, and guarantees-are
in the presentation. The end of the formal presentation “asks for the order.” Asking for the order means asking
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the prospect to take action. In most situations, before prospects will agree to make a transaction, they have
many questions and object-reasons for not buying.

Handling Objections
If the only thing salespeople had to do was make presentation and then take an order, they would not be paid
very much. Getting a prospect to move through a decision-making process and say “yes” takes a great deal of
skill and perseverance. An important skill is getting prospects to voice their objections- that is, to admit the real
reason why they aren’t convinced or why they don’t want to buy now-and then responding to the objections.
Understanding objections is key to understanding customers. In the best-case scenario, a sales rep learns what
the prospect’s objections are, is able to satisfactorily address the prospect’s objections during the presentation,
and goes on to close the sale. In the worst case, a prospect’s unknown objections are not addressed, and a sale is
lost. A sales rep who has no idea why prospect didn’t buy will fail to learn anything valuable that could be
passed on to company management or avoided in the next call.
For example, a frequent response to a sales presentation is: “You have a good product and we could really
use it, but we just can’t afford it now.” Good salespeople respond to this type of objection in one of several
ways. One way is to offer the prospect credit terms that do not require payment several months. Another is to
point out how the product can reduce costs and therefore pay itself in x number of months. Good salespeople
anticipate objections and have answers ready, often in the form of information-filled charts and graphs.

Closing and Following up the Sale

Once objections have been successfully addressed, the next step closing the sale, which means finalizing the
terms of the transaction and getting the prospect’s agreement to those terms, followed by issuing a purchase
order or signing a contract. Moving a customer to this point of commitment, to actually sign on the dotted line,
is the goal of the entire selling process.
Once a sale is made, it is important to keep in contact with customers to make sure all of their expectations
have been met. Was the product delivered on time? Was it in good shape? Was the billing correct? Is the
customer aware of the next promotion opportunities? Making sure the customer is satisfied requires following
up in person or by phone, e-mail, or regular mail (see exhibit 16-8).
Some salespeople are reluctant to follow up, believing that doing so is asking for trouble, because when a
customer tells about a problem, the result is extra work for the salesperson. Finding out what went wrong,
finding the right people in the company to address the problem, and then making arrangements for the problem
to be addressed take time for which a salesperson is not paid anything extra. But avoiding follow-up is a sign of
short-sighted thinking.
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A customer who has a problem that isn’t quickly addressed and solved is not likely to remain a customer. Also,
follow-ups provide a legitimate excuse for contacting a customer and introducing new products, especially if the
customer is satisfied with the first purchase.

MANAGING THE PERSONAL SELLING FUNCTION

Managing personal selling involves recruiting, training, tracking, compensating, and rewarding sales reps, as
well as managing budgets and divvying up accounts. How best to integrate personal selling into the company’s
overall marketing communication program is also a management concern. Two management issues especially
relevant to IMC are (1) how to measure the effects of IMC on sales and (2) how to compensate and reward
salespeople. The former interfaces with some of the sales-promotion tools; the latter is similar to spending
money on advertising media.

Measuring Personal Selling Efforts

A number of measurements can be used to evaluate personal selling. A cost per call is calculated by comparing
a salesperson’s total costs (salary, commission, expenses) to the number of calls made in a specified period of
time (generally one year). A sales-call-to-close ratio can be determined by comparing the total number of sales
calls made to the number of prospects and customers who actually bought.
Tracking these measurements helps ensure the sales effort is going in the right direction. For example, if the
overall company call-to-sale ratio is 5-to-1 this year (meaning one sale was made for every five sales calls),
steps should be taken to reduce that ratio to, say, 4.5-to-1 for the following year. Such ratios can be used to
evaluate individual sales representatives, as well. If the company call-to-sale ratio for the average salesperson is
6-to-1, for example, a salesperson with an 11-to-1 ratio may well be advised to go work for the competition!
Here are examples of how to figure some of these measurements:
Total sales costs $2,500,000

Cost per call = = = $294

Number of calls made 8,500

Number of calls made 8,500

Call/ sales ratio = = = 5
Number of sales made 1,700
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Total sales costs $2,500,000

Sales cost per sale = = = $1,470

Number of sales made 1,700

For IMC, several other important measures of how well a salesperson performs are (1) the average length of
time an individual’s accounts have been buying from the company, (2) the average annual sales and profitability
of these accounts, and (3) the number of referrals made by these accounts. Because a primary IMC objective is
to retain customers, the average customer lifetime should continue to increase if a salesperson is doing a good
job. Also, current customers should be motivated to increase the quantity of their purchases from year to year.
Finally, customers who have a good relationship with a salesperson and a brand will be more likely to
recommend that person and brand to other companies which means the number of these referrals should be
tracked.

Over time, determining how many of salesperson’s customers remain with the company and how many have
been lost is relatively easy, as is determining how many sales each salesperson has generated. Sophisticated
accounting software can now tell the overall profitability of each salesperson’s customers. Using discounts,
premiums, and other considerations can make a sale fairly easy, but the best salespeople are those who generate
sales without making so many concessions that the company makes little or no profit on the transactions.

Compensation and Rewards

Compensation systems are changing in personal selling. Traditionally, compensation was based totally or
primarily on sales volume. Some companies still have salespeople work solely on commission (which is a
percentage of the sales price paid to a salesperson for each transaction). Often, top salespeople who work on
100 percent commission are some of the highest-paid people in a company. The problem with commissions
being the major compensation factor is that they reward transactions rather than long-term relationships.

To have a customer relationship focus, companies must balance how they reward salespeople, because people
respond to what is measured and rewarded. This is why salespeople are increasingly being evaluated and
rewarded not only for sales but also for how long customers are increasing their purchase quantities (customer
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growth), and how much customers are helped by the salesperson to solve their problems and increase their
productivity (customer satisfaction).

Special prizes, such as trips and other high-value premiums, are frequently used to increase sales in the short
term. For a new-product introduction, for example, salespeople may receive an extra incentive if 65 percent or
more of their customers buy the new product within the first 90 days of its availability.

In addition to evaluating salespeople according to set objectives, companies nowadays also ask customers to
rate the salespeople who call on them. Because the success of personal selling can be so dependent on working
with other people in an organization, some companies even ask people in their distribution, accounting, and
customer-service departments to rate salespeople. It is critical that the salesperson’s performance be consistent
with the firm’s positioning and reinforce the firm’s other marketing communications. What the salesperson says
and does will either confirm or contradict the company’s other brand messages.

Integrating Personal Selling and Other Marketing

Communication Functions
The primary criterion for determining when personal selling should be integrated into the MC mix is whether
the margin on each transaction is large enough to cover the high cost of personal selling. Procter & Gamble
can’t cost-justify having a sales representatives sell its Tide and Ivory soap to individual consumers because the
selling cost would be many times the average purchase price of a few dollars. Personal selling is used when a
product is complex and the purchase will require assistance to use and maintain the product, such as enterprise
software systems, medical imaging devices, and automotive diagnostic equipment sold to auto repair shops.
Also, personal selling is integrated into the MC mix when there are a limited number of customers, such as in
the beverage can industry, which has only a few dozen major customers (primarily manufacturers of soft drinks
and beer).

Personal Selling and Advertising

In B2C selling, advertising is used by retailers such as car dealers and home furnishing stores to get consumers
in the door. These retailers know that the products they sell are major purchases for which advertising can best
only create interest. Most buyers of cars and furniture ask many questions during the information-gathering
stage of decision making. Once the prospect is in the store, a salesperson is the best resource for responding to
these questions, which can be done while customers closely examine the products being considered.
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EXHBIT 16 – 9 EXHIBIT 16-10

This State Form ad is directed to small-business owners and invites them to call a sales rep or visit the company’s
website.

The Fidelity ad describe the services a Fidelity sales rep can provide and invites interest readers to call a toll-free
number.

In B2B selling, advertising’s brand awareness and brand knowledge do certain amount of preselling (see
Exhibit 16-9). Advertising can be used to communicate information about the company behind a product as
well as key product benefits. Mass media advertising can reach of prospective customers for far less than it
would cost for a salesperson to contact the same number and ask whether they were interested in the brand (see
Exhibit 16-10). Nevertheless, most B2B decision makers have many questions. Complex products, for example,
may need to be demonstrated.

Another aspect of advertising that is integrated into the personal selling process is the designing and production
of brochures, sale skits, and other materials that salespeople used during sales calls. These sales kits can be
anything form a simple set of price sheet, to a fancy glossy binder, to an elaborate box of varied materials. The
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American Diary Association's Cheese Retail Sales Kit (see Exhibit 16-8) was prepared to support and tie into
the association's "ahh, the power of cheese" advertising campaign. These types of sales kits usually include
sections in product selection and pricing, merchandising ideas, retailer advertising aids available, consumer
advertising schedules, public relations efforts, consumer promotions, market research, and ways to customize
these as materials for individual retail stores.

Personal Selling and Public Relations

Like advertising, brand publicity in the form of video releases can help create brand awareness that makes a
salesperson's job easier, as it saves time explaining who the company is and what it stands fo. In addition,
public relations is especially helpful to the sales force in selling innovative and complex products, particularly
when a company's brand is endorsed by a third party such as an industry writer or consultant

The sales force not only benefits form public but also does public relations. Salespeople are often the most
pervasive public face of the company. Because a salesperson is usually the only person form the company who
customers ever see and talk to face-to-face, the salesperson is the company. If the salesperson is responsive and
helpful, the company is perceived as being responsive and helpful. This is why most companies that provide
cars or trucks of their sales force insist that these vehicles be kept clean, because they are constantly seen by
thousands of people every day ( many deferent stakeholders).

Personal Selling and Direct Response

Direct response is frequently used to generate leads for sales representatives. It may also be used for follow-up
contact with current customers. IMB has embarked on several integrated, database - driven pilot campaigns that
have generated three times as many qualified leads as did previous campaign. A key component of these
programs is asking customers what they are looking for in produc and service and how they like to be contacted
by the company - by mail, e-mail, phone, fax, brochures, salesperson's visit, or not at all.

Personal Selling and Sales Promotion

A number of sales-promotion tools and techniques can be incorporated into personal selling to strengthen the
salesperson's presentation and help close the deal. Fox example, a sales kit may include free samples, discounts
and coupons, or product-related gifts. Trade promotion ( Chapter 15) is an important aspect of channel
marketing, which relies heavily on personal selling. Finally, sales reps themselves are the target for incentives
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programs that are designed to increase their enthusiasm for a product and encourage them to push the product
more and sell harder.

Strengths of Personal Selling

The primary objective of personal selling is building trusting relationships (that result in sales). Any brochure or
ad can describe the benefits of a brand, but a personal sales call can humanize a brand a company, particularly
when that interaction is supported by CRM.

The greatest strength of personal selling, therefore, is customized two-way communication, which is the
ultimate way to integrate a product and its features with customers' wants, needs, and opportunities. Two-way
communication is the most powerful form of persuasion-not only to encourage someone to buy but, more
important, to encourage that person to remain a customer. By using face-to-face communication, a skilled
salesperson can observe a prospect's body language and encourage him or her to express objections. The one-to-
one situation facilitates instant feedback to objection ( which a good salesperson should anticipate and be
prepared to address). Once a relationship is established, motivating sales becomes mush easier.

Accountability and measurability further strengths of personal selling, mean that this aspect of IMC is highly
numbers-driven. In most cases, a company can easily measure the sales that each salesperson generates in a
specified. Because most companies use commission-based companies and salespeople are concerned about how
salespeople spend their time and what their selling efforts produces.

Personal Selling is the most flexible IMC element. It allows sales messages to be tailored to each customer and
prospect, allowing instant changes in a sales presentation as the situation requires. Negotiation is a vital aspect
of this flexibility. Personal communication makes it much easier to find the terms that best suit the buyer's
needs and to adjust the offer accordingly. If a buyer is primarily concerned with an earlier delivery date, for
example, a salesperson may absorb the cost required to meet this date by getting the customer to either buy an
additional amount or pay for the merchandise sooner.

Because good salespeople are in constant contact with their customers and know their customers' business, they
can collect information and build valuable customer databases. A rich customer database offer vital information
to marketing people, allowing them to prepare personalized, targeted messages. Such database also become
very valuable when a customer is assigned to a different salesperson. The agillion ad in exhibit 16-11 illustrates
how database systems are being used to support customized sales programs.
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Limitation of Personal Selling

Like all other MC functions, personal selling has some limitations. The most important limitation is its high
cost. Maintaining a sales force is costly because it requires not only salaries (or commission ) but also sales call
expenses, recruitment, training, and other internal support function. Because it is basically a one-to-one
medium, there are few economies of scale. In fact, two or three salespeople sometimes go to a single important
customer's office to make a presentation or make multiple presentations if they represent different product lines.
In personal selling, companies don't even think about cost per thousand (it would give most executives a heart
attack). As previously mentioned, a single personal sales call can run into the hundreds of dollars.

Another limitation is that some salespeople overemphasize making a quick sale and lack the patience to build
relationships based on promising long term leads. A study of 40,000 buyers found that only 11 percent of those
who made purchases did so within three months of their first contact with the company. The study concluded:
"It's important to put a relationship marketing program in place to nurture long-term leads." This limitation,
however, is not always the fault of salespeople. Compensation based on commission fosters the emphasis on
transaction at the expense of relationship. Salespeople should be rewarded for generating sales, but when
volume is the major portion of their focus, there is tendency to overpromise in order to make a sale.

The human connection that was described as a strength can also create a dilemma: customers may develop
loyalty to salespeople rather than to the company or the brand. As a result, when salespeople change jobs, their
customers may move with them. A partial solution to the problem is for the company to maintain a
comprehensive database of customer interactions with the company. The database enables a new salesperson to
immediately set up and work with each customer intelligently because each customer's history with the
company is available.

One of the strengths of personal selling is flexibility, but the flip side flexibility ia often strategic inconsistency.
When salespeople begin to craft customer specific sales deals, they may create and deliver brand messages that
are at odds with the overall brand strategy. An upscale, status brand positioning will not be reinforced if a
salesperson continually encourages retailers to run sales.

Just as direct-response advertising is seen as intrusive and often in poor taste, personal selling has developed an
image problem over the decades because of so much high-pressure selling and less-than-ethical practices. Thus,
a common jibe is that someone who seem sleazy is like a "used-car salesman." Many companies today give
salespeople euphemistic titles such as marketing associate, marketing representative, admissions coordinator,
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clinical liaison, professional service representative, or program manager. The idea is to counteract the rejection
associated with the word salesperson.

A study of college students United States, Britain, and Thailand found that students form these diverse
geographical areas all had a very low impression of sales as a career opportunity. Although 72 percent agreed
with statement "The financial rewards form selling are excellent," 40 percent said a salesperson's job security is
poor. Another sign of the reputation problem comes form a Mesa, Arizona, electrical wiring firm that got almost
no response to ads for n college papers that said," Looking for entry-level salespeople." When the same
company instead ran an ad for marketing people, resumes poured in.

Regardless of the image that personal selling has, this marketing communication function is a huge industry.
For many, it offers an entry-level position into marketing; for others, it provides a lifetime career that brings
many financial and personal rewards.

A FINAL NOTE: HIGHEST COST, GREATEST IMPACT

Personal selling is the 9 00-pound gorilla of marketing communication. It cost a lot to feed and care for this
beast, but when used for good, its muscle and impact are generally far greater than any of the other MC
functions. Integrating personal selling into the MC mix must always be cost-justified, because the cost is
significant compared to the cost per sale of all the other ways to reach customers and prospect. When personal
selling is the number-one MC functions used, efforts should constantly be made to see where less expensive
MC functions and media could be used to help salespeople do their jobs, allowing reps to use their time to do
only what personal selling does best-engaging in one-to-one dialogue that permits an instant response to the
Individual questions and concerns of customers and prospect.