call centres can be within the company or specialist call centre can be hired
to handle outbound telemarketing.? A
company called ADS Telemarketing provides a range of services including data
enhancement, mailing follow up, customer reactivation, lead generation,
appointment selling, market research and brand development. 2.3 Methods of distributionDue
to the vast range and complexity of product channel combinations, there are six
main types of channels used for selling life assurance products:1)
The independent
financial advisor. (IFA?s) 2)
Direct sales forces. 3)
Appointment
representatives 4)
Bancassurance 5)
Mail and advertising 6)
TelephoneFor
the purpose of selling life assurance three main distribution channels should
be implemented.●Bancassurance ●Mail
and Advertising ●TelephoneReasons
for not using distribution channels 1, is that there has been accusations that
IFA?s sold policies on the basis of most lucrative commission.Reasons
for not using distribution channel 2, is that their loyalty changes depending
which company they work for. There is also the danger of high-pressure sales.Reason
for not using distribution channel 3, is because Bancassurance is preferable,
as they sell only life assurance products, which will be the company I am the
sales manager of.Mail
and Advertising reflect the importance of marketing, as the life assurance
industry faces growing competition for people?s savings from other financial
institutions. Marketing will also help in cleaning the tarnished image of the
life assurance industry. 2.4 Direct MarketingDirect
marketing has grown to be the significant element of the communication mix, as
it will add on extra dimension to elements of the promotional mix.My
purpose for using direct marketing will be used as a direct response mechanism,
as we will engage in a number of TV and print advertisements. This strategy
will be used as a means of attracting and retaining customers.Our
direct marketing activities will consists of direct mail, telemarketing,
Internet marketing and direct response mechanism.The
biggest benefit of using direct marketing is to build an on-going relationship
with an individual customer, so that the customers trust and confidence grows
with my company. We will also capitalise on this by analysing the customer
needs and purchasing habits in order to tailor future offerings to fit that
customer profile.Direct
marketing will also enable to create loyal customers, as we have entered into a
dialogue with them, and have their needs and wants met through tailoring
offerings, which will make it hard for competitors to poach them. Direct
mail will allow us to communicate at length and in depth with our customers
personally.The
Internet will make easier for us to locate our target segment, and also it will
be cost effective for us to build direct responses mechanisms, as a higher
proportion of the audience reached will be interested, then a relatively high
response rate can be expected.2.4.1 Sales costsCommunication
is becoming very expensive, therefore direct response advertising, followed by
direct mail activity will prompt the customer into action, which will be cost
effective for us.2.5 No
matter how good the life assurance is, or other promotional elements, the
representatives will have to show the customer the benefits of dealing with our
life assurance company. That is why management of the sales force is very
important, which is part of the sales plan involving recruiting, training,
management, motivation and compensation of my sales force. 2.5.1 RecruitmentIt
is important to begin recruitment by developing a profile of the type of person
we are looking, which will lead to a list of ideal skills characteristics of
the representative to be recruited.2.5.1.1 Job Analysis The
job will involve selling, as well as concentrating highly on customer
relationship management. The applicant should therefore be able to perform
sales tasks in line with company policies.2.5.1.2. ManpowerAfter
the job analysis, manpower planning is important, in order to achieve the
organisations objectives. The life assurance market is huge, therefore staff
will be required, to perform personal selling activities, telemarketing and
Internet marketing activities. The most commonly used formula to asses the size
of sales force is described below as an example.The Inputs C
= number of customers F
= average frequency of calls per customer year L
= average number of calls per representative day N
= average number of selling days per representative per year The
Calculations Stage
1 T = C x F = total number of calls per year Stage
2 D = T / L = total number of selling days required per year Stage
3 S = D / N = number of sales representatives required Source:Russel, F. A (1997) Textbook of salesmanshipIt
will not be necessary for new recruits to have experience as they will be
trained in our own methods, as experienced sales reps may come with bad habits
and other organisation weaknesses.2.5.1.3 Source of Sales recruitsRecruits
will be mainly from educational establishments. Reason being that a
relationship is developed between the company and the new recruit, which will
help enhance the relationship of the sales rep and the customer.2.5.1.4 SelectionThe
selection process will be designed to draw out evidence of the ability that the
candidate can perform the specified tasks.?
In view of making the right choice, in addition to normal interviews and
reference procedures psychological tests to access the personality of the
candidate as the job entails a lot of customer interaction.2.6 TrainingThe
recruitment process only provides the raw material, therefore training will be
given for better sales performance. Training will not only be for new recruits,
but for existing staff, even well established staff for skills refinement and
upgrading.? For
new recruits training will given in knowledge of life assurance products, so
they understand what they are selling.Selling
skills are also important, therefore depending on where the recruits are based
i.e. call centre, on the road, appropriate training will given to improve
standards in the selling of life assurance products, in a customer benefit
approach. 2.6.1 Competency testing for sales people.All
people involved in selling life assurance products must take an independent
test to assess their level of knowledge of the life assurance industry and its
products and services.Anyone
who actively engages, advices or assists in completing a proposal for a member
of the public has to pass the course.?
This includes sales staff of life assurance companies who give advice.The
only exemptions apply to holders of certain equivalent or higher qualifications
(eg.A.C.I.I) or sellers of ?limited? products ranges.2.6.2 RegistrationAnyone
who sells a life assurance product is included in a central Registry of Life
Assurance Sales people. The objective of the register is to protect the
customer by establishing and maintaining sales standards and to improve the
standing of those who sell life assurance.The
included on the register are: Sales staff employed by the life assurance
company Anyone assisting or advising the public. The
register includes information on the name, address, and date of birth of each
salesman as well as his or her status, qualifications, details of current
employment. Each
salesperson is also assigned an individual registration number which is carried
with him/her from one employer to another. Every proposal form filled out by the
salesperson will quote the number. 2.7 ManagementHaving
a mixture of telemarketing, and having a team of sales reps visiting the
customers will accomplish the management of the sales force. The telemarketing
will be more focused on building relationships.Territory
management will be configured and sales reps will be assigned to certain
territories. Potential customers will receive direct mail, which will require a
response from them to matters further.Territory
management will allow us to strengthen our customer relationships as 9/10
repeats sales occur due to good relationships. It will also help in evaluating
the sales force and co-ordinating selling with other functions.The
sales reps time will be structured to maximise productive time and minimise
wasted time i.e. maximising customer contact time, which will allow the company
to maximise sales and profit potential of each territory.2.8 MotivationAny
sales effort requires motivated sales people, as the motivated seller will sell
better.New
recruits joining the sales force will be sufficiently rewarded for their
achievements so that are not easily poached by the competition. Besides
financially based motivation factors other methods will be used.Team
activities will take place to create a sense of belonging to a team can be
important.? Bringing the representatives
back to HQ for regular team meetings, seminars and briefing will help foster
team spirit. This will allow an opportunity for the team to share the views and
experiences. Training programmes will also play a part in reaching employees
that they are valued. Representatives
whether on the road or in the call centres will be involved in managerial
activities, such as developing their own sales plan, an it will give the sales
rep a greater sense of control over their own working as well as there is an
open an co-operative management.Mechanisms
for regular feedback will also be devised through a direct data link, which
will make them feel they are offering more than just selling expertise.I
as the sales manager will create healthy rivalry between sales rep, through
sales contests, items that are seen as valuable and achievable. Contest will
not be focused on sales figures, but on a range of important activities, such
increased penetration of existing accounts.2.9 CompensationsThe
compensations method to be employed will be straight salary compensation plan,
as it is more appropriate on our aim is to encourage the representation to
spend time developing relationships with the customers.? However bonuses will be awarded similar as a
profit sharing scheme. This is to find an appropriate balance between income
and incentives.Fringe
benefits will include free medical insurance, a generous expense account, paid
holidays and sickness leave, to keep the staff happy.2.9 Performance EvaluationMonitoring
and controlling an individuals selling activity is vital therefore there will
be a systematic means of gathering account information on a weekly basis from
the sales rep. From a strategic point of view, this will help is assessing the
general impact of marketing policies at account level.Performance
will be measured in qualitative and quantitative terms, which will allow me to
find explanations for a particularly good or bad performance, which will
indicate the need on training or motivation. Section B Sales Force
automation Because the cost of
maintaining a direct sales force is high, sales force productivity is an
important issue for sales managers.? In
many industrial organisations, sales force costs are the largest single
marketing expense item.? A typical sales
rep will have a car, mobile phone, expense account and bonus scheme, but there
are limits to the number of customers that can be met in any particular
day.? Many organizations complain that: ·
Sales force
effectiveness is difficult to measure; ·
Potential business
leads slip through the net; ·
Vital customer
information remains hidden on scraps of paper or in the sales representative?s
head; ·
If a sales
representative leaves the company, important customer information also leaves; ·
Sales representative
are always busy but the sales results are often mediocre; ·
Bonus schemes fail to
encourage sales teams to greater efforts.In response, companies
have looked at various methods of automating the sales force (SFA) to improve
productivity and increase sales.? The
technologies and tools that companies use to automate their sales forces vary
significantly, it is like creating a virtual office in the car.The Yankee Group, a
consultancy company, has identified three separate generations of SFA tools: ·
Generation 1: personal
information and contact management.? The
first generation of SFA tools, products such as ACT!, Goldmine and Maximzer,
was designed to help sales representatives to manage contacts and time and
increase their selling effectiveness.?
Such powerful time- and contact-management tools had not existed
previously and were accepted quickly and enthusiastically. ·
Generation 2: networked
contact management.? The second
generation of tools was essentially networked versions of the first, connecting
the contact-tracking database and personal productivity tools of the sales
force with the corporate network, contact and prospect database.? Sales representatives were equipped with
laptop computers that they synchronised or ?replicated? with the corporate
network each day. ·
Generation 3:
technology-enabled selling.? The third
generation of SFA has its primary focus on making the sales force effective
where it matters most: in front of the customer.? The new generation of tools allows sales representatives to
configure products, prepare proposals, give illustrations and quotes, and track
orders, using their laptops.The benefits of SFA can be
significant. ?HP foods, for example,
which sells a variety of food products through shops and supermarkets, replaced
its traditional sales force of 100 representatives with 12 business development
executives equipped with mobile phones and computers, thus making significant
cost savings without compromising service quality.? The business case for automating the sales force does not have to
stop with the sales representatives.? If
it is extended further into the organisation, the benefits are far more wide
reaching.? Campbell?s Soup, for example,
invested $30mn in SFA for some 1000 sales representatives, sales
administration, marketing, operations and IT employees in the USA and
Canada.? The New Jersey-based company,
with customers including supermarket chains, other grocery retailers and food
service vendors such as KFC and McDonald?s, targeted savings of more than $18mn
annually through shorter order-cycle times, more accurate invoicing and better
control of funds used for product promotions.?
Campbell?s efforts cut across a wide range of functions; distribution,
pricing, invoicing, settlement and accounting.SALES MANAGEMENT BS535-3 FROM: FAYAZ PATEL TO? : JOHN WARD