With different types of custome rs, the business should apply the correct methods and tools of marketing. This ensure for the potency of business activities and often do not waste materials the resourses for making use of the unsuitable tools to the targeted customers. Personal Selling is one of the 5 components of the marketing communication combination which involve direct contact with customers targeted towards building customer-unique value and long-term romantic relationship, additionally it is called customer-driven. It shows that it's the most reliable tool in B2B market.
The market of machines and equipment for coal and mineral deposits exploring sector has the typical characteristics of B2B market. They have specific requirements on technology, different size and different methods of procurement that the various tools such as: advertising, campaign, publicity is inadequate.
The most effective solution to acquire, sustain and develop customer romantic relationship is Personal Selling in which the sales activities is dependant on the close romance of salesperson and buyers.
Itasco-HN is the seller of heavy commercial equipmnet and spare-parts who wthhold the long time marriage with the purchasers in the coal and mineral exploring sector. It has gained amazing growing steps through time but and yes it took some errors in conducting business however now still has been acquiring some complaints on services from customers, such as: past due guarantee services, insufficient range of sparepart. . . .
Second problem is the issue in reselling territories between salesperson, this is understandable because of the selling techniques applied here predicated on the romantic relationships built during operation.
Finally, the responses of customers that people are in the lack of engineers in conditions of amount and experience also, this anticipated to we have been just reseller only but offer with many types of machine so that we can not make use of enough technical engineers or technician for all those sectors we involved.
This situations result from not only the exterior factors but also inside subjective reasons, here, the mainly from the management decisions and the advertising performance of the salesforce.
This research aims to determine what exactly are regularly arising faults, what is heading wrong with the salesforce performance and then the corresponding modification and solutions recommending applied to increase the situation.
The target of the study is to understand the buying action: characteristics and mechanism of buying decision, that we can appoint the right salesperson to each activity, the right point of time to access to and the very best technique of reselling applied to make our customer most sastisfied with the gear and services given by ITASCO-HN.
To have look and feel to the sales activity of the company and then to identify the causes of failure in advertising, the problems that produce the sales ineffective in order to discover the corresponding solutions for better performance and desired objective.
To find out How the sales force are sent out with available resources which resources are sufficient with the mandatory jobs appointed.
From that research to have an assestment of the clients, who is the actual, who is key-account. and which strategy should be applied in short-term and medium or longterm for every.
For helping Personal Selling the Company should apply, at exactly the same time, any marketing tools, should invest in any supporting means or improve any operations of performance to be able to get the best aim, that is the satisfaction of customers.
- Place: researchs are taken in ITASCO-HN and its customers in Vinacomin for providing all exploring machines, equipment and spare-parts mainly because of this industrial sector.
- Sector: This research also has the limit in the sector that the effect can only just applied in the specific field. Among the B2B market, this research carried inside our business (the reseller) and in market including processing businesses within Vinacomin only, other styles are dismissed such as: administration organizations, establishments.
- Research method: as the limitation of the qualitative method, from the research we can only just know the motivation of buying decision but we do not know the effecting level of the factors to your choice of buying or not.
- Test: the sample of respondent is small so the result might not exactly be representative.
- This research concentrates on the marketing tool play as the primary of the sales activities of the business (ITASCO-HN), that is Personal selling,
» Marketing is thought as a interpersonal and managerial process where individuals and categories »obtain what they want and want through creating and exchanging products and value with others. 1 (1)(Guidelines of marketing, 4th Model, Philip Kotler, Veronica Wong, Gary Amstrong)
Exchange processes entail work. Sellers must seek out clients, identify their needs, design good products and services, promote them, and store and deliver them. Activities such as product development, research, communication, circulation, costs and service are core marketing activities.
Business market involves all the organizations that buy goods and services to use in the production of other products and services that are sold, rented or provided to others. It also includes retailing and wholesaling businesses that acquire goods for reason for reselling or booking these to others at a earnings.
But this explanation is still thin as the viewpoint of Jim Blythe and Alan Zimmerman (Business to Business marketing management - a worldwide perspective). The full Business market includes customers who are institutions like clinics and charities and everything levels of government. The business enterprise market not only includes physical products but services as well. In fact, as we can easily see, large institutions, governments and businesses buy almost every product and service. (3)
Business potential buyers generally buy to increase their profits, institutional purchasers have the same concerns nonetheless they may be focused on providing an satisfactory surplus. There are only two basic ways to increase earnings: increase sales or lower costs. These targets may be achieved by increasing efficiency or purchasing lower-cost products/services. Sometimes business buyers also buy to avoid penalties from federal regulators. Therefore, we can conclude that the very best marketing programs directed at business customers are always based on one of the next basic appeals:
1. Increasing sales.
2. Minimizing costs.
3. Meeting federal government regulations.
The market where businesses sell to other businesses is extremely large, associated with many parts are created and transacted by many steps prior to the completed consumer product are sold to the final consumer.
(oil, iron & alu. ores, plastic. . . )
(chemicals, material, alum. Refiner. . . )
Parts and sub-assembly
(plastic mildew, parts, electric Co. , . . . )
(Plastic parts, heating aspect, motor, fan, wire, control. . . )
B2CAs the keeping track of of Jim Blythe, in order to manufacture a straightforward product as electric hairdryer, there are about 18 transactions can be explained as business to business(B2B) category and only 1 final transaction participate in Business to Consumer (B2C). To create this hairdryer requires raw materials from oil, metal, aluminum and silicone suppliers, materials processors who process natural ores into usable products, manufacturers of parts and sub-assemblies who put together materials of varied kinds and deliver serveral components to another firm who would be a last assembler. The ultimate assembler the provides the product to the distributor. This firm then sells the product to a wholesaler, who subsequently provides to a shop and only then your product is sold to the final consumer. Each get together in this string also buy many related goods and services. This example shows why there is certainly more business buying than consumer buying - many units of business purchases were designed for only one group of consumer buys. (3) (Jim Blyth and Alan Zimmerman)
Figure 1. 1: Orders participate in B2B and B2C
+ The potential buyers in the forex market are fewer in quantity but bigger in term of amount and value in comparison with B2C market.
+ The marketplace is geographically concentrated. For this characteristic, the clients who buy our equipment and materials track down mainly in Quang Ninh province, Northeast of Vietnam. The areas of coal mines are 04 centres including : Mao Khe - Uong Bi, Hon Gai, Cam Pha and Mong Duong- Khe Cham, therefore, the offices and physical infrastructure of mine also identify here.
Business demand comes from demand. It derives from the demand of the other business or consumer demand.
The demand of coal from electricity, cement, chemical manufacturer. . . increase can make the demand of coal exploring equipment increase because of the Coal-mine-companies want to get to expand end result and we be prepared to sell more equipment and materials to these lenders. In the recession of market, the demand of electricity and cement drop and the sales of said exploring equipment will be, obviously, affected adversely.
Business demand is inelastic - The demand in awareness of the change in cost. the change in price do not have an effect on the demand in the short run. A decrease in price also do not make the demand of any equipment increases. The demand is often designed and fixed for short-term. The decrease in price only makes the buying better value and the complete production more effective but do not change the demand.
Business market segments have fluctuating demand. The demand for many business goods and services changes more than the demand for consumer goods and services. A small percentage increase in consumer demand can cause large rises in business demand. Sometimes a growth of only 10 % in consumer demand can cause just as much as a 200 % rise in business demand during the next period.
That is professional buying. Often, business buying is performed by trained purchasing agents, who spend their working lives learning how to buy well. The more complex the purchase, the much more likely that several people will participate in the decision-making process. Buying committees made up of specialized experts and top management are common in the buying of primary goods. Moreover, some business may uses the support from talking to that produce the marketing and negotiation even more complicated.
Therefore, business marketers must have well-trained salespeople to deal with well-trained buyers.
+ Kind of decision: your choice of business customers are more technical than that of consumer purchasers. »Business customers usually face more complex buying decisions than do consumer clients.
Purchases often entail large amounts of money, complex technical and economical considerations, and connections among many people at many degrees of the buyer's company. Because the purchases are more technical, business buyers might take longer to make their decisions. For instance, whenever a mine decide to buy a main water pump station, it often can take about one year for the fulfilment of the bid package because the sole creation period may carry on for 06 a few months. It also could involve a huge selection of technological issues, many legal strategies, some an incredible number of US buck and dozens of people ranging from top management to on-site users.
+ Process of decision: »
The business buying process tends to be more formalised than the buyer buying process. Big technical acquisitions of business usually call for detailed product specifications, written purchase orders, careful supplier queries and formal acceptance. Especially, the buying process in the state-owned companies or government's organisations require a strict procedures that must definitely be complied with rules.
In the business enterprise buying process, buyer and vendor are often much more dependent on each other. Consumer marketers are usually far away from their customers. In contrast, business marketers may roll up their sleeves and work tightly with the customers during all periods of the buying process - from assisting customers identify problems, to finding solutions, to encouraging after-sales procedures.
Out of some mentioned characteristics, business market also have some circumstance such as: immediately buying, leasing, reciprocity.
To grasp the buying behavior of business will be the decisive factor of success for salespeople. In order to understand how business customer buy we will find the answers for the 04 questions hereunder:
What buying decisions conduct business potential buyers make?
Who participates in the buying process?
What are the strongest influences on customers?
How conduct business potential buyers make their buying decisions?
+ You will discover 03 situations of buying: direct rebuy, changed rebuy and new job. Also known as buyer's techniques. (1) (Philip Kotler)
- Situation 1: Right rebuy: the problem when the customer reorders with no change in required technical specs, prices, volume and other conditions of the previours agreement. In cases like this, purchasing team simply select from the offerings by the regulary suppliers. In many cases the customer establishes an electric data interchange (EDI) link with a provider or establishes automated buying procedures through Internet and orders are handled with no human interface. Generally, these kind of buying are applied in the conditions that the merchandise is of slight importance, or presents a low determination in conditions of finance or risk. Regulary vendors try to keep their popularity and good romantic relationship by good quality of goods and services. The strange sellers, step by step, try to persuade the buyer that their quality of goods and services are better than that of other and their price is more competitve. They first make an effort to get small order and then to expand their share as much as possible as time passes.
- Situation 2 :Modified rebuy: the customer bases on the actual requirements of work to buy with some modifications on technical specifications, time of delivery, price or other conditions. Even the distributor may be improved. Sometimes theses changes come about consequently of environmental scanning, where the buyer has become aware of an improved alternative than the one currently applied, or sometimes the changes happen because of marketing activities by the current suppliers' competition. The drawback of this approach, however, is that it often leads to damaging the partnership with existing suppliers that might have been built up over many years.
- Situation 3: New activity: the business enterprise buyers buy goods or services for the very first time which is quite an available opportunity to every sellers. Previous experience is therefore no guide and current suppliers might not exactly have the ability to help either. Thus the buyer is confronted with a sophisticated decision process. The potential risks for buyers involved in switching suppliers tend to be too great unless there is a very real and clear advantages in doing so: this advantage is likely to be difficult to confirm used. The new-task situation is the marketer's ideal opportunity and task. The internet marketer not only tries to reach as many key buying influences as is possible, but also provides help and information.
In some situations, based on the specific requirements of the project or work the business want to buy a packaged method for problems from a single seller. That is called System buying. Instead of buying equipment and services in different phases and in separated offer of components, the business call for the bids that the company could supply the full set of solutions and all equipment for the job.
For example: the EPC bids (Engineering, Procurement and Building), in which the supplier must appreciate works from anatomist, supplying equipment and materials, structure and installation, procedure and transfering to the customer.
The retailers have increasingly acknowledged that buyers like this method and also have adopted systems providing as a marketing tool. Systems selling is a two-step process. First, the seller sells several interlocking products: for example, the selller provides not only glue, but also applicators and dryers. Second, owner sells a system of development, inventory control, syndication and other services to meet the buyer's need for smooth-running procedure. (1) (Philip Kotler)
Systems offering is a key business online marketing strategy for winning and possessing accounts. The contracts often would go to the firm offering the most satisfactory system that meet customer's needs.
There are incredibly few instances where professional buying decisions are created by only 1 person. Even in small businesses it is likely that several people would have a much some impact or source into purchase decisions. As a result of this, the decision - making process often becomes formalized, with specific regions of interest being portrayed by users of the decision - making product (DMU) and with assignments and resposibilities being distributed. This group which cannot be fixed and determined on any company organization chart, also called the BUYING CENTER, varies in proportions and make-up from one buying situation to some other, from one type of products to some other. Individuals may get involved for a short time only, or be part of the group from conception to bottom line.
According to Webster & Wind flow (1972), the DMC includes 06 types of member: Initiators, Gatekeepers, Purchasers, Diciders, Users and Influencers. (2)
According to Philip Kotler in Rules of Marketing in B2B, the DMC includes 05 participants who play 05 assignments in the buying decision making process. These categories aren't mutually exclusive. A Individual might also be an Influencer or a Buyer might also be considered a Decider. (1)
In truth, the participants of the Decision - making Product are afflicted both by logical and emotional motivations. Salespeople are well aware that customers are afflicted by their preference or dislike for the supplier's reps and buyers will often be working to their own agendas: for example, purchasers might be seeking a promotion, or might feel threaten in terms of job security, or may be doing a vendetta with a colleague. These influences might have an effect on the customers' tendencies, but all of them would be difficult or impossible for the supplier's salesperson to recognize correctly and act upon.
In general, members of an Decision - making Unit tend to be risk-averse than consumers. This is because the DMU's people have more to forfeit in the event of an incorrect decision: for consumers, the main risk is financial and even that is bound since most stores will replace or refund goods purchased in mistake. For industrial purchasers, however, a serious purchasing mistake can lead to major negative repercussions for business as well as lack of face at work, in shattered campaign dreams, or even in dismissal in serious instances. The professional persona of industrial buyers is liable to be affected by purchasing errors, which means that potential buyers will feel a loss of self-esteem.
Business clients are at the mercy of many affects when they make their buying decisions. Some marketers suppose that the major affects are monetary. They think clients will favour the supplier who supplies the least expensive price or the best product or the most service. They concentrate on offering strong financial benefits to purchasers. However, business clients actually respond to both economic and personal factors. Far from being cold, determining and impersonal, business purchasers are individuals and public as well. They respond to both reason and sentiment.
When suppliers' offers are very similar, business purchasers have little basis for purely rational choice. Because they can meet organisational goals with any provider, buyers can allow personal factors to play a more substantial role in their decisions. However, when rivalling products are different greatly, business buyers are more in charge of their choice and have a tendency to pay more attention to monetary factors.
There are 04 main sets of influences on business potential buyers: environmental, organisational, social, and specific.
Figure 1. 2 and its own explanatory notes, shows why business purchasers are likely to be influenced by some or all the following environmental influences. (4) (Loudon and Della Bitta, 1993)
Economic affects: The macroeconomic environment can be involved with the level of demand throughout the market and with the existing taxation regime within buyer's country. These conditions affect buyers' talents to buy goods as well as their need to buy recycleables: if demand for their product is low, the demand for raw materials to make them may also be low. The macroeconomic local climate affects business potential buyers' confidence in the same way as it influences consumer confidence. For instance, a widespread idea that the countrywide economy is about to go into a decline will almost certainly make buyers hesitant to invest in major investment in stock, equipment and machinery. With the microeconomic level, companies experiencing a growth running a business will have a larger ability to cover goods and a greater level of confidence.
Political affects: Authorities frequently pass regulations affecting the way businesses operate. A big change of the federal government or coverage has a primary impact on the economic situation, and this eventually translates into a change in the organizational buying habits as well.
Legal affects: regulations often lay down specific benchmarks, which affect purchasers' decisions. Often, suppliers can obtain competitive edge by anticipating changes in regulations.
Physical influences: the positioning of purchasing companies in accordance with their suppliers may be decisive, since many companies prefer to cope with folks from the same cultureal history or they wish to support local suppliers.
Technological influences: the amount of technical development available among suppliers will have an effect on what buyers can obtain. The technology of customers and sellers must be compatible, especially in technical standards.
Cultural affects: culture establishes the ideals, attitudes, customary action, language, faith and skill of a given group of people. Beyond the nationwide culture is the organization culture, sometimes thought as "just how we do things around here".
Ethical affects: in general, buyers are expected to act all the time for the advantage of the organization, not for personal gain. Which means that, in most ethnicities, the buyers are anticipated not to allow bribes, for example. However, in a few civilizations bribery is the standard way to do business, which leaves suppliers with a major honest problem - refusing to give a bribe is likely to lose the business, but providing a bribe is probably unethical or illegitimate in the business's home country.
Competition influences : Today's business is focused on conquering competition and keeping forward. So when an organization's competitors move on to a newer service or product, or if indeed they get to like a competitive edge for their suppliers, it is rather likely for the business to improve its trends too and therefore its buying style will change consequently.
More than the exterior factors, it is the interior organizational factors that effect organizational buying. The organizational factors are based on the organization culture, as well as from the proper decisions created by older management within the business. Organizational policies, methods, structure, systems of rewards, authority, position and communication systems will all have an effect on the ways buyers relate with salespeople.
Some examples of strategies and regulations in buying organizations has already established a considerable impact on buying decisions of the purchasers: the introduction of just-in-time (JIT) production systems, purchasing performance analysis, upgraded purchasing, long-term agreements. . . all that the business enterprise marketers got to know as thoroughly as is feasible to match and catch the development and changes in B2B market.
The DMU usually includes many participants who influence one another. The business internet marketer often find difficult to know what kinds of social factors and group dynamics enter the buying process. As you writer notes: ' Professionals does not wear label that say "decision machine" or "unimportant person". The powerful tend to be invisible, at least to suppliers' reps. Nor will the participants in DMU with the best rank will have the most influence. Members may have affect in the buying decision because they control rewards and punishments, are popular, have special know-how, or have a special relationship with other important individuals. Interpersonal factors tend to be very subtle. Whenever possible, business marketers must try to understand these factors and design strategies that take them into consideration.
»Each participant in the business buying-decision process brings in personal motives, perceptions and personal preferences. These specific factors are damaged by personal characteristics such as era, income, education, professional identification, personality and behaviour towards risk. In addition, clients have different buying styles. Some may be technical types who make in-depth analyses of competitive proposals before choosing a provider. Other buyers may be intuitive negotiators who are adept at pitting the retailers against one another to discover the best deal.
In this final section we'll have a look at a few of the situational factors that can influence organizational purchasers.
Time Factor: Sometimes, organizations don't have at all times to check out the thorough buying method. If the business needs a alternative to equipment that broke down all of a sudden, it may decide to place its order with some existing distributor or a company that is at close proximity.
Current FINANCES: If the organization is crunched for cash, it may decide to place its order with one of its existing provider who offers prolonged credit. Also, if the organization cannot free out enough money for a certain purchase, it may opt for a easily available cheaper version that works with into its budget.
Availability: Some buying decisions can hang on while others cannot, thus if the company cannot make available the precise product by the required night out, the organizational customers may move to a new supplier or to a more readily available alternative.
Special Offers: Special offers being distributed by a supplier may also be one of the situational factors impacting the buying decision.
As a company, given that you know what factors impact organizational buyers, you can work up your business to business sales strategies to change organizational buying activities and so procure more orders for your supply business.
Business buying is seen as a series of decision, each of which leads to a further problem about which a decision must be made. From the viewpoint of the business marketer, you'll be able to detect problems by examining the series of decisions, provided, the decision is known to the professional. Marketers can identify the level of which the firm happens to be making decisions and can tailor the way accordingly.
The most complicated buying situation is New-task which require the largest number of decision makers and purchasing influences. This is because New Process require the greatest amount of effort in seeking information and formulating appropriate alternatives, but will also require the greatest engagement of individuals whatsoever levels of the business, each with their own agenda. Customers making customized or upright rebuys may miss a few of the phases. (Appendix No. 1: Buygrid Platform)
Recognition of an problem: the first level of the business buying process where someone in the business recognises an issue or need that can be achieved by acquiring a good or something. Problem reputation can derive from external or internal stimuli. Internally, the company should launch a new product that require a new development equipment and materials. Or perhaps a machine may break down and need new parts. . . . Externally, the customer could see an advert or get a call from a salesperson who offers a better product or a lower price.
Description of characteristic and level of needed item: the level available buying process in which the company describe the overall characteristics and quantity of a needed item. For standard items, this level is simply. But for more technical items, the buyer may need to work with others: engineers, users, consultants. . . to explain the items. The team may choose to rank the importance of reliability, sturdiness, price and other attributes desired in that. In this period, the alert business internet marketer can help the customers establish their needs and offer information about the worthiness of different product characteristics.
Determination of characteristics and quantity of needed item: the stage in the business buying process where the company chooses on and specifies the best technological product characteristics for the needed item.
Value analysis is a way of analyzing components, raw materials and even developing processes in order to determine ways of lowering costs or enhancing completed products. Value-in-use is thought as a product's economic value to the user relative to a particular alternative in a specific request (Kijewski and Yoon, 1990). Value-in-use is the price that would equalize the overall costs and great things about using one product alternatively than using another. The vendors may use value analysis as a tool to »help secure a fresh account. By showing buyers a better way to make an object, strange sellers can turn upright rebuy situations into new-task situations that provide them a chance to obtain home based business.
Search for and certification of resources: the level available buying process where th buyer attempts to find the best vendors. The buyer can make a shortlist of experienced suppliers by researching trade directories, searching on Internet or phoning other companies for recommendations. Using internet is absolutely a great chance of small suppliers to learn on the market with the same gain as the top suppliers.
»The newer the buying activity, and the more complex and costly the item, the greater the amount of time the customer will spend looking for suppliers. The supplier's task is usually to be listed in major sites and create a good reputation available on the market. Salespeople should watch for companies in the process of looking for suppliers and make sure their firm is known as.
Aquisition and examination of proposals: in this stage the buyer invites the skilled suppliers to summit proposals. In response, some suppliers will send only a catalogue or a salesperson. However, when that is complicated or expensive, the buyer will most likely require detailed written proposals or formal presentations from each potential dealer. Business marketers must be skilled in researching, writing and presenting proposals in response to buyer proposal solicitations. Proposals should be marketing documents, not only specialized documents. Presentations should inspire confidence and really should make the marketer's company stand out from the competition.
Evaluation of proposals and collection of supplier (s): the stage of the business enterprise buying porocess where clients reviews proposals and choose a provider or suppliers. During the selection, DMU will draw up a list of desired characteristics and their ralative importance. The people of DMU will rate suppliers against these qualities and identify best suppliers. (Appendix No. 2 illustrates some of the ways that buyers can assess potential suppliers. )
Increasingly, companies today are minimizing the number of suppliers. These businesses expect their preferred suppliers to work tightly with them during product development and they value their suppliers' ideas.
Selection an order routine: in this stage of process, the customer writes the final order with the picked supplier or suppliers, list the technical specs, amount needed, expected time of delivery, come back policies and warranties. Regarding maintenance, repair and working items, buyer are inceasingly using Blanket requests rather than regular purchase requests. A blanket order creates a long-term relationship in which the supplier assures to re-supply the buyer as needed at agreed-on prices for a collection period. The seller keeps stock and the customer transmits an order when the stock needed. Getting a blanket order dispenses the customer from holding large inventories and taking costs and avoides administrative price of processing regular purchase purchases.
Blanket contracting contributes to more single-source buying and to buying more items from that source. This practice locks the distributor in tighter with the buyer and helps it be difficult for other suppliers to break in unless the buyer becomes dissatisfied with prices or service.
Performance reviews and analysis: the stage of business buying process in which the buyer rates its satisfaction with suppliers, deciding whether to keep, enhance or drop them. The buyer may contact user and ask those to rate their satisfaction. The seller's job is to monitor the same factors employed by the buyer to make certain that owner is supplying the expected satisfaction. (Appendix No. 3: Evaluation approaches)
All these methods involve some amount of subjectivity, quite simply each method requires buyers to make judgments about the suppliers. The actual fact that the final results are portrayed in numbers provides each method a spurious trustworthiness: those involved in evaluation exercises of the nature should be aware that the analysis exercises itself should be examined routinely and the requirements used by the many individuals involved must be inspected.
Among the five main components of integrated marketing and sales communications - IMC (advertising, sales campaign, public relation, direct marketing), personal selling is used as the utmost effective method in B2B marketing.
+ Definition of salesperson: an individual acting for a business by performing one or more of the next activities: prospecting, interacting, servicing and information gathering. Salesperson is a person who may stand behind the counter-top or whose job calls for the creative offering of products and services (professional equipment, insurance and consulting services. . . ) or simply develops a goodwill or educates buyers. (3)
+ Description of Personal offering - is any form of personal presentation by the firm's sales force for purpose of generating sales and building customer human relationships. (3)
Personal selling incorporate some specific tools: sales presentations, fairs and industry events, and incentive programmes.
Personal advertising is the very best tool at certain phases of the buying process, especially in building up buyers' choices, convictions and activities. Compared to advertising, personal offering has several unique qualities:
It requires personal conversation between two or more people, so each person can take notice of the other's needs and characteristics and make quick changes.
Personal advertising also allows all types of relationships to spring up, ranging from a matter-of-fact offering romantic relationship to a profound personal camaraderie. The effective salesperson helps to keep the customer's hobbies at heart to be able to create a long-term marriage.
Finally, with personal providing the buyer usually feels a greater need to pay attention and answer, even if the response is a polite 'no say thanks to you'.
These unique features come at a cost, however. A sales force takes a longer-term commitment than does indeed advertising - advertising can be fired up and off, but sales team size is harder to change. Personal advertising is also the business's most expensive promotion tool, costing companies several hundred euros on average per sales call.
+ The relative importance of personal offering in B2B market: The need for different promotional tools varies between consumer and business market segments (see Body 1. 3). Consumer-goods companies usually put more of their money into advertising, accompanied by sales advertising, personal offering and then pr. Advertising is relatively more important in consumer market segments because there are always a larger quantity of buyers, purchases tend to be regular, and emotions play a more important role in the purchase-decision process.
In contrast, industrial-goods companies put almost all of their» cash into personal offering, accompanied by sales campaign, advertising and public relations. In general, personal selling is utilized more greatly with expensive and dangerous purchases, and in market segments with fewer and greater sellers.
Figure 1. 3: Comparative importance of advertising tools
in consumer versus industrial marketsn. (1)
+ The role of sales team in personal advertising:
Personal selling is just about the largest solitary budget item generally in most B2B market. Salespeople earn high wages and need expensive back-up: means of traveling, supervision assistance, expensive brochures and sales materials and so forth. Counting the traveling time, prep time, etc. Salespeople spend only a little portion in their time-budget actually generating sales presentation. This leads to the question that why have we not had the opportunity to find a cheaper way to get business?
The reason is the fact that salespeople provide a personal touch. A salesperson can meet a buyer or indeed anyone else in the buying group, discuss the organization's problems and discover the right creative solution. The buyer understands the business's problems, the salesperson knows the capacities of the dealer and their products and both of these one share understanding of the industry and the environment where it operates.
The key point in this is the fact selling is about building a dialogue: it is not about persuading potential buyers to buy things they don't really really want, it isn't about fast-talking a buyer into making a rash decision and it is unquestionably not about sharing with lies about the supplier's products.
Figure 1. 4: Establishing dialogue in personal advertising. (3)
As an integral part of promotion mixture, Personal selling is different from the other elements for the reason that it always offers a two-way communication with the possible customer, whereas each of the other elements is usually a one-way communication. Therefore, »personal selling can be more effective than others in more complex selling situations. That is partly why is Personal offering such a powerful instrument; the salesperson can clarify things, answer queries and concentrate on those issues which seem to be of very best to the chance.
More essentially, the salesperson is able to carry out a "general market trends" with the chance and discover which issues are of all relevance, often in a interactive way that allows the salesperson to highlight issues that your prospect had not been aware of. And further, »they can build long-term personal associations with key decision manufacturers.
The role of personal selling varies from company to company. Some businesses have no salespeople in any way - for example, organisations that sell only through mail-order catalogues, E-commerce or through manufacturers' associates, sales agents or brokers. Generally in most organizations, however, the sales force plays a significant role. In companies that sell business products, such as our company (ITASCO), Komatsu, Feline, the salespeople would be the only contact. To these customers, the sales team is the company. At the same time, salesperson also respond on the viewpoint of the buyer to the company, they organize the contacts between the company's sales makes and the buying providers. ,
»As companies move towards a more powerful market orientation, their sales pushes are becoming more market centered and customer oriented. Today, organisations expect salespeople to check out sales data, strategy market potential, gather market intelligence and develop marketing strategies and plans. They ought to know how to orchestrate the firm's attempts towards providing customer value and satisfaction. A market-oriented rather than a sales-oriented sales team will be more effective in the long run. Beyond winning clients and generating sales, it will help the company to make long-term, profitable relationships with customers.
As with other forms of marketing communication, providing works best as part of an integrated marketing campaign. Salespeople think it is much easier to call on potential customers who have already listened to something about the dealer through trade fair, advertising, publicity.
Good sales force management plays a decisive role in the sucess of offering of any company, especially in industry selling which the requests come mainly from the long-term romantic relationships built by the sales force.
The company bases on the volume of the market, the relative capability of sales force to set up the feasible objectives to the sales team. Some very specific goals may be pointed out such as: the sales amount for each and every month, each one fourth or the deadline for bringing out the new technology to customer, the plan of personal contacting time to customers and prospects. . . . and the sales force must organize their sales clubs, time budget, means of traveling, budget. . . quite simply conform to the business's offering goal.
The sucess of personal selling is dependent much on the task of the business to design the appropriate sales force strategy and framework toward each customer or prospect.
In order to win the orders from customers, the salesforce strategy must be identified basing on the overall knowledge of not only the organization's buying process but also the charateristics of the DMU's participants. From that the business may use the correct selling methods as specific sales display or team sales demonstration, conference selling or seminar selling (educational advertising).
Salespeople make sales demonstration in individual or team contact form they still need the assistance and support from other associates of functional departments of the company. it can be the introducing phone call from the director, may be the technical information from technician, the support from finacial official, aftersales personnel or other administratvie officers.
»Once the business decides on a desirable selling way, it can use either a direct or a contractual sales team. A primary (or company) sales force contains full- or part-time employees who work specifically for the business. This sales force includes inside salespeople, who perform business using their offices via cell phone or appointments from prospective clients, and field salespeople, who happen to be call on customers. A contractual sales team includes manufacturers' reps, sales people or brokerages who are paid a commission rate predicated on their sales.
From the sales force strategy identified, the business accumulates the sales team structures ideal for the characteristics of customers, the merchandise lines of the company, the characteristics of the marketplace. . . . Several typical sales team structure usually utilized by supplier as pursuing:
Territory framework: is the salesforce business that assigns each salesperson to an exclusive geographic territory where that salesperson sells the business's full lines of products and services.
Product salesforce structure: the salesforce company under which sales people specialize in reselling only a portion of the company's products or lines. This framework is applied in the circumstances of the company's numerous products lines or the product of too complicated technology so the specialist is really required. This sort of salesforce organization can lead to the discord among the different sales groups in approaching the same leads or same customers.
Customer sales force structure: the sales force organization under which sales representatives specialize in offering only to certain customers or companies. This type of sales force structure is specially effective to apply in selling commercial goods and increasingly more sellers are using it. This request can make the company more customer-oriented and present the company the chance to develop long-term romantic relationship.
Complex sales force structure: »When a business sells a wide variety of products to numerous types of customer over a wide geographical area, it often combines various kinds sales force framework. Salespeople can be »specialised by customer and territory, by product and territory, by product and customer, or by territory, product and customer. A salesperson might then report to a number of line and personnel managers. No structure is most beneficial for those companies and situations. Each organisation should decide on a structure that best acts the needs of its customers and will fit its overall marketing strategy.
Other structures of sales team: outside sales force (field sales team), inside sales force, team offering, and key-account offering. Each can be utilized in the particular context of market, advertising systems available in distributor, the quantity of market. . .
Usually, the first basic that the company uses to set up the size for sales team is the workload procedure. By this process, the business considers some factors as how big is the buyers, the potential sales quantity in short-term and medium-term, the characteristics of the merchandise and services related to the amount of effort required and regulate how many salespeople are had a need to call on customers and potential customers the desired amounts of times.
Recruitment play a decisive role in the sucessful performance of the sales force for any retailer. A firm, therefore, should establish a true strategy and a complete standard process that require counting for the particular characteristics of the industry involved, the merchandise and services, the relationships network, the existing sales team for recruiting good salespeople.
+The requirements required: they are different in consumer market (B2C) and B2B market, the industrial equipment even requires some specific characteristics for salesperson.
In Vietnam heavy professional equipment, the requirements of order priority for good salespeople should be: in a position to build good long-term marriage, customer-oriented, experient, enthusiastic, 3rd party, complex, self-motivated. . . This order is quite reasonable in sales performance in Vietnam scheduled for some factors as culture, degree of technology, practices and traditions and market itself.
When recruiting, beside the key criteria explained above the business also considers carefully other personal charateristics of the candidates as the health, marriage status, in order to gain access to if they can travel for long period, will they join the new working environment quickly? Can they be able to approach and work with top management officials of the buying business?
+ Way to obtain applicants: from other business' sales representatives, tips from exisitng sales representatives, appointments from inside departments, employment businesses, introductions from professional colleges and universities. . . .
+ Recruiting operations and methods:
Generally, recruiting process may be devided in 06 steps:
Step 1: the table of director discusses with the sales Dept. to draft a specific set of desirable qualities and decide recruiting.
Step 2: the Individuals tool and Administrative Dept. gathers the demand from sales Office and builds a set of standards of candidate
Step 3: Human tool and Administrative Office refine the CV of applicants, only CV of carefully prepared and briefly experienced are determined.
Step 4: a written test is structured then to rate the applicants. Good result candidates are informed to meet up with the business's interviewers.
Step 5: an interview is keep for cadidates as the final test.
Step 6: working contracts and probational period are create for new sales people to begin with.
The steps may vary in one company to another depending on requirement of the positions, the amounts of candidates to use, the quality of candidates. . .
Actually, the training in a business is the next phase in the recruiting process before making the produtivity of the sales team. Training can be long or short depending on the complexity of products and market, recruits are experienced or not.
Typically, training comes into two sections: school room and field training:
Classroom training: the recruits are presented about the company and about the merchandise, about the competition, about the industry and and customers. They may be taught some grounding in sales techniques (these are usually outsourcing training). Selling experience are also created by the top management and experienced salespeople.
Field training: which can be an ongoing training curriculum carried out before real customers in the field. People have a tendency to learn best by doing the task, so most sales training programs involve large field training, either by sending out trainees with experienced salespeople or engineers, or by sending them from their own early in their professions ("let's them swim"). The last mentioned method is applied if there are many customers. But also for most industrial selling where customers and purchases are fewer but much larger, a mistake happens could cause serious results. In these circumstances it might be better to give trainees an extended period to work in a sales team alongside more capable salespeople.
A good reimbursement policy of a company can make the sales force perform effectively. This can decrease the turn-over rate, thus reduce many types of costs for recruiting, training, costs of reduction sales, and moreover new sales representatives is less effective than the experienced one.
»Compensation comprises of several elements the following:
Fixed amount: usually a salary, provides salesperson some secure income.
Variable amount: that will be commissions or bonus items predicated on sales perfomance, rewards the salesperson for increased effort.
Expenses: which salespeople payed for providing activities stipulated and accepted by the business and become repaid.
Fringe benefits: such as paid holidays, sickness or car accident benefits, pensions and life insurance coverage, provide job security and satisfaction.
The company usually uses these elements to set up the following 4 types of repayment: upright salary, straight commision, salary plus benefit and salary plus commision. The appropriate type of repayment can be utilized as a tool to motivate salespeople and also steer their activities. The sellers in industrial market have a tendency to design the formular of repayment that reward salespeople for building long-term marriage and growing long-run value of each customer.
The companies must supervise the actions of the sales team to ensure that the selling activities aren't in wrong course. The supervision needed applies not limited to new salespeople but the whole sales team in order to direct and motivate them for far better performance.
+ Directing sales team:
The company can help salespeople to target customer in their territories and require them utilizing their time budget very specifically.
Sales administrator also direct salespeople how to spend their time proficiently, requiring these to schedule their appointments weeky, monthly, each year to customers and potential customers and to prepare reports appropriately. Even salespeople need to be instructed timing their vacationing, participating sport games with customers, eating, hanging around, timepoint to meet and whom to meet. . .
» SOURCE: Reprinted with authorization from Dartnell Firm, 30th
Sales Force Compensation Survey, copyright 1998 by Dartnell Corporation, 360 Hiatt Drive, Palm Beach Backyards, FL 33418.
Today, more and more the internet is popularized, the consumption of internet in reselling activities is more effectively and making the advertising costs reduced and changing the relative proportions of the above chart. For example, Salespeople can exchange informaion by email intead of calls or faxes, easier looking techincal information, customers' information, competitors' informaiton. . . .
+ Motivating sales force:
Beside directing salespeople, the company also requires a set of norms and stipulations aiming at motivating them. Inspiration tends to result from sources apart from payment. The basic view of drive was suggested by Abraham Maslow (1954). Maslow's Hierarchy of Needs model explained that people will fulfill the needs at the low end of any pyramid (survival and security) before they move on to dealing with needs at the uper end (love/belonging, esteem and self-actualization). Thus, once a salesperson has guaranteed his physical needs, they are not motivators any more; the individual will then moving to belonging or esteem needs. This circumstance are right as the Vietnamese proverb "Mot tram tien cong khong bang mot dong tien thuong", means that one hundred as a salary/wage can't be compared to one as a benefit.
For this reasons The Table and Sales managers usually have to consider the correct motivational tools for the right kind of salesperson.
Company's working climate: that make salespeople feel that their opportunities are good among members, their value are highly treasured, their good selling results are the opportunity for higher income and campaign.
Company's incentives and encouragement:
One of the usual incentives is the Sales conferences which is often prepared for all salespeople and high level positions in the business an opportunity to meet in order to make their heart higher, to make their "business culture" characteristics again popularized in all members.
Other meeting can be maintain as training seminars, workshops or some events such as: teambuilding, sport video games. Here, salespeople have chance to exchange ideas, conversing and making the relationship more familiar, the perfect time to honour the best salespeople. . . Other incentives can be sales competition, trips awards, items awards. . .
Encouraging salespeople by supplying a prize or present to their family members.
All the above mentioned motivational devices target at making the salesforce feel to be in high spirits, packed with energy and ready for the new difficulties. They also setup ties between salesperson to the company, making salesperson be accountable for tasks and responsibilities assigned by the company.
+ Why assessing: in order to really have the basis to give out some kinds of course and motivation, the business must evaluate the salespeople' sales performance.
+ Sources of information: Sales records are mostly employed by any vendor including weekly sales reports, each month, quarterly and annually as well. Information also comes from studies of salesperson's sessions to customers and leads, from the bills records used for offering activities. Other resources can gather from customers' claims, customers' surveys, discussions with DMU's users and clients, talks with other salespeople.
+ Assessing steps:
Step 1: determine conditions for evaluating: criteria may include: sales volume level(value or volume) in place or by accounts, ratio of completion compared with ideas or quotas, gross margin weighed against plan, profit weighed against plan. . .
Step 2: set-up performance standards
Step 3: comparing performance specifications.
Step 4: responses to salespeople.
In the final step, management board discussions with salespeople to point out their progresses or drawbacks and then may give directing proposals or motivational device. The purpose of giving reviews is to help salespeople to improve their performance in the foreseeable future.
Personal selling can be an ancient fine art that has spawned a huge literature and many principles.
Effective salespeople are powered by more than simply instinct - they are really experienced in methods of territory research and customer management. Effective companies take a customer-oriented approach to personal advertising. They teach salespeople to recognize customer needs and find solutions. This approach assumes that customer needs provide sales opportunities, that customers appreciate good suggestions and that customers will be loyal to salespeople who've their long-term passions at heart. In comparison, those companies that use a sales-oriented methodology rely on high-pressure selling techniques. They expect that the clients will not buy except under pressure, that they are influenced with a slick presentation and that they will never be sorry after putting your signature on the order.
The personal offering process includes many steps, in this dissertation I'd like to take the view of Zimmerman in examining the details of the procedure where salespeople get new customer and acquire orders from them. ( See Amount 1. 6 ) - The offering sequence is attracted as a circle to indicate that it is a continuing process.
Figure 1. 6: The offering cycle
+ To generate leads:
The activities are sometimes called Prospecting, although in truth they differ significantly. Lead generation is concerned with finding people who are prepared to meet the salesperson and notice what he must say, (while Prospects are potential buyers who have a dependence on the merchandise and in a position to shell out the dough). To generate leads is an activity of creating first contact; some leads can be supplied by the company but salespeople need skills to find their own. Leads are made via cold-calling (making sessions or calls without an visit), advertisings, exhibition, mails, personal recommendation.
When the business lead has a need for the product and also offers the means to shell out the dough. In some instances these issues can't be clearly determined prior to the meeting with possible client, but a good salesperson will try to investigate a possibility as thoroughly as is feasible before squandering time to make a sales call.
+ Preparing: setting up both actually and emotionally: clothes, right presentation materials, frame of mind, knowledge.
+ Appointing: making appointment with the decision-makers in buying corporation.
+ Presenting: the process of conducting a primary talk with the prospect's need, from clarify the answers to prospect's need and shutting the deal (the order is positioned or may be not).
+ After-sales activities: including follow-up cell phone calls on customers frequently to learn lessons, to improve any shortcomings. . . the unexperienced salesperson often have the fear that customer will have a grievance but it is far better to discover that it is actually the condition if salesperson didn't. Further, after-sales sessions also offer opportunities for other sales or asking tips. Other after-sales activities include making certain the paperwork is properly completed, delivery on time and representing the customer's view back to the business and other appropriate market information.