The Changing Role of Sales and SalespeopleHow to develop a long lasting relationship with your customers

Published March 2010 Updated November 2010 9 lectures
Prof. Bill Donaldson
Aberdeen Business School, The Robert Gordon University, UK
Summary

Making sales is what a business is about. If you don’t sell you don’t survive. Sales is therefore an important part of any series of topics on marketing but often sales and marketing are seen to operate, in both academic teaching and in practice, in separate silos. This is a... read moremistake. The aim of this series of talks is to inform the viewer of the importance of selling and sales management issues and how it forms an essential part of marketing your business.

Sales operations are the revenue generation engine of the organization and thus have a direct impact on the success of the firm. Yet, the role of sales and that of salespeople is changing. What drives this changing role? In part, it is being driven by structural and industry changes. For example, in grocery products 56% of all purchases are sourced through just 4 buying points (Mintel, 2006) with the result that the size of the sales force has reduced dramatically and also changed in the nature of the tasks to be performed. Overall the numbers employed in sales continue to rise. In 2003 there were 766,000 full-time sales professionals within field sales operations, an increase of 9% since 1993 (Benson Payne Ltd/ MSSSB, 2006). In some industries such as pharmaceuticals and financial services the numbers have risen dramatically. For example, Fortis, a major European bank, employs some 686 business development managers with many others in managerial and support staff roles across their operations. This means that businesses need to adopt a different perspective for integrating sales and other forms of communication with the operational side of their business.

Driven by an urgency arising from more complex supply chains, fewer and larger purchase points, the availability and use of IT in customer contact operations, relative increased costs of labour, and the continuing internationalization of business, sales operations are now different and more strategic. These factors contribute positively to the need for more efficient exchange and communication systems between firms and their customers, predicated by increases in the costs of acquiring new customers, and the need to retain the existing customer base and stimulate the purchasing power of those customers already on the books. Personal selling can be defined as the personal contact with one or more purchasers for the purpose of making a sale. Its importance is such that expenditure on the sales force usually exceeds the budget for all other marketing communications activities added together, with the possible exception of advertising in large, fast-moving consumer goods companies or direct marketing organizations.

Owing to their boundary spanning role, the sales force of a company has traditionally been a vital link between the firm and its customers and a prime platform for communicating the firm’s marketing message and the voice of the customer to the firm. In the high tech world, it is easy to overlook the importance of personal relationships and how the interaction with customers has changed, if at all.

Salespeople have always realized the importance of relationships but there is now added recognition that salespeople are critical in gaining the maximum value from each customer. Therefore, the management task is to re-engineer sales practices to maximize the value generation potential of the sales force in this new environment.
As a result, the nature of the personal selling task is continuing to change in that selling to customers has been replaced by cooperating with customers.

The goals and objectives for the salesperson have also changed from achieving or exceeding target, selling X products in Y period and maximizing earnings, to that of building repeat business with the firm’s existing and potential customer base. The emphasis has shifted from ‘closing’ the singular sale to creating the necessary conditions for a long-term relationship between the firm and its customers that breed successful sales encounters in the long run. This shift renders obsolete many of the currently available sales management practices and the sales philosophy and culture that have driven the development of the sales management field for decades. It also questions sales performance measures based on individual criteria and sales management practices which reflect recruitment, training and rewards based on sales volumes rather than relationship performance. The role of the salesperson seems to have moved away from traditional aggressive and persuasive selling, to a new role of ‘relationship manager’ and, in practice, we are witnessing a tendency to change the sales lexicon from sales force to business development managers, customer account representatives or sales consultants. Perhaps the change in the title is designed to facilitate the transition of the sales force’s tasks from selling to advising and counselling, from talking to listening and from pushing to helping.

The new reality of relationship marketing directs salespeople and sales managers to develop long-lasting relationships with their customers based on mutual trust and commitment and shared experiences.