Sales Management and Strategy

Sales Management and Strategy The business world is currently experiencing high levels of competition. This is due to availability of capital, easy entry into markets, present of substitutes and increase in the purchasing power of consumers (Sorce 6).Advertising We will write a custom research paper sample on Sales Management and Strategy specifically for you for only $16.05 $11/page Learn More As a result, firms need to come up with effective and efficient strategies in order to achieve a competitive advantage over their rivals in their respective fields of operation in order to be profitable and sustainable in the short run and in the long run. Consultative sales approach is a strategy that managers of many organizations currently use to stand at a competitive edge over their rivals. The main aim of this strategy is to develop strong relationships between firms and their clients (Sorce 9). Many managers view this strategy as a critical differentiator hence enabling a firm not only to i ncrease its sales but also to stand at a competitive advantage over its rivals. The relationship that is developed through consultative sales approach makes sure that a firm understand the needs and desires of its customers. In this way, the firm is capable of developing goods and services that satisfy this need. This in turn creates brand loyalty and acts as an avenue for the growth of a firm in the short run and in the long run. From the discussion that has been presented so far, it is essential for firms to develop strong relationships with their customers. However, marketers usually try to maximize the benefits of economies of scale while utilizing the consultative sales approach. To achieve this, marketers usually believe that it is more convenient for a firm to develop strong relationships with a few large customers than many small customers (Oliver 35). This is because firms normally incur high operational costs in marketing, selling and distributing finished products or serv ices to the customers. Therefore, concentrating once a few large customers will reduce the extra costs, time and energy that is required to carter for many small customers. Therefore, a strong relationship exists between constructive sales approach and marketing. It is essential first for a firm to identify its target market, come up with effective and efficient marketing strategies that will capture the attention of their targeted customers, then finally use the consultative sales approach to develop strong relationships.Advertising Looking for research paper on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More However, before a firm decides to build a strong relationship with a client, it needs to have a clear understanding of them. This is essential, as it will determine the type of relationship that the firm shall develop with its clients and the tastes and preferences of the clients. It has always been advisa ble that a firm partners up with clients who are innovative, creative, leaders in their respective industries, and clients who are highly experiences (Sorce 12). Collaborating with such clients will improve the reputation and credibility of a given firm hence boosting its operations in the short run and in the long run. After the prospective customers have been identified, it is essential for a firm, through its marketing strategies, to build a strong customer commitment to the brand (Reichheld 18). In most cases, this is achieved through customer satisfaction and through the development of brand equity. This in turn results to the development of a strong relationship between a firm and its customers. To satisfy the needs of its customers, a firm needs to deliver goods or services that are of superior quality as compared to the ones provided by rival companies in the industry. This plays a critical role in the development of brand equity. Brand equity is a factor that is based on th e level of brand loyalty, brand awareness, reputable quality of the brand, relationship of the brand and its customers and marketing impacts of the brand by its loyal customers (Reichheld 19). It is essential for a firm to ensure that these factors are implemented successfully as they guarantee repeat purchases, protection against price fluctuations, increased responses from customers and marketing of the products by customers especially through the word of mouth. Initially, firms strived to achieve a relationship that was based on consumer satisfaction. However, the results of recent studies have shown that despite the fact that customers might be satisfied with the quality of goods or services offered by a firm, quite a good number of them usually defect to other brands (Reichheld 19).Advertising We will write a custom research paper sample on Sales Management and Strategy specifically for you for only $16.05 $11/page Learn More Thus, to overcome this set back, it has always been recommended that firms that deal with consumer products to develop brand equity with their consumers while firms that focus on industrial products should develop strong brand relationships with their clients (Reichheld 19). Several marketing strategies have been developed to ensure that brand equity is achieved. This includes the use of electronic and print media to advertise the products. It is as a result of this fact that many advertisements of various products are found on radio, TV, newspapers, magazines, social network sites and websites with huge traffic on the internet. These adverts seek to capture the attention of customers from different cultures and backgrounds as well as customers who have different tastes and preferences. The use of social media as a platform of advertisement and consumer engagement has also increased. It is through such forums that firms get to understand the needs, tastes and preferences of their customers and involve them in the process of manufacturing, developing, testing and marketing their final products. This form of involvement plays a critical role in brand equity. Some firms also sponsor public events to increase the awareness of their products. Gillette for example is a brand that sponsors many sports and sports shows. Through its activities, the brand has gained a lot of recognition worldwide. Through its activities in a bid to sponsor the 2010 football world cup, Coca Cola increased its brand awareness and restored its brand loyalty to many consumers all around the globe. On the other hand, firms that focus on industrial products use a different marketing approach in building brand relationships with their clients. Here, the sales force of a firm plays a critical role in developing a relationship that is based on interdependence between a firm and its clients through one-on-one communication (Sorce 14). One-on-one communication has always been considered as the most convenient way to build a long lasting relationship with clients by firms that manufacture and sell industrial products. Initially, it was difficult for a firm to reach out to all its clients at an individual level. It is perhaps as a result of this that firms advocated to focus on a few large clients than many small clients. Despite the fact that this notion is still applicable, the presence of marketing databases coupled with improvements in the utilization of the information communication technology (ICT) has improved the process reaching out to customers at an individual level.Advertising Looking for research paper on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More Therefore, marketing and consultative sales approach play a critical role in developing brand equity and strong brand relationships with their clients. In the process, firms that utilize this strategy usually develop strong brand loyalty. This is essential especially in a time where firms face stiff competition from their rivals, as firms will benefit from the economies of scale by serving their loyal customers who are always ready to pay premium prices and market the products or services of the firm through word of mouth. This will not only increase the market share of such a firm but it will also ensure that the firm is profitable and sustainable in the short run and in the long run. Strategic Sales Management and Sales Forecasting and Budgeting Sales forecasting is an essential concept in sales management position of a firm. GE Appliances, for instance, put a lot of consideration on sales forecasting due to its importance in the planning its operations. GE appliances also use sal es forecasting as a tool of determining the future sales of the company. The data generated from this method is critical in the development of market mix and generation of effective leads for the firm (Mentzer 34). Reduced costs of operations coupled with the increase in consumers have increased the level of competition in almost any industry, including the electrical appliance industry that GE Appliances operates in. Thus, to overcome this challenge, GE Appliances has utilized sales forecasting among other strategies. Through sales forecasting, GE Appliances is able to determine its future sales values. In the process, the firm is capable of formulating effective planning strategies that will improve the quality of its products and services hence ensuring that it stands at a competitive edge over its rivals. Sales forecasting also gives the firm information pertaining to changes in market trends, consumer tastes and preferences and the general performance of the industry (Jackson 1 23). With this information, GE Appliances is capable of maintaining a strong work force that is capable of meeting the needs and demands of its clients. This information is also essential in the development of budgets. For instance, the firm might realise that the performance of some of its brands are not as per the expected standards. With this information, the firm shall spend more on advertising the product hence increasing its brand awareness into the market. This enables the firm to overcome the challenge that it might be facing as a result of increased competition within the industry. From sales forecasting, the sales figures for the next financial period are usually determined. Consequently, the net sales, profit or loss can be ascertained. With this information, GE Appliances usually decide on whether to control or increase the budgets of its various departments (Jackson 131). Several challenges are usually faced while creating a budget. In most cases, budgets are created ba sed on decisions and data from a macro level of operation. However, the actual application of the budget shall be on a micro level. Therefore, to ensure that the budget is implemented in an effective and efficient manner, several considerations need to be put in place. First, the need of the budget needs to be established. Here, the managers and head of departments need to determine all the expenses, whether direct or indirect, that they might incur. To achieve this, GE Appliances usually get this feedback from sales managers (Stanton 14). It is also essential to ensure that there are multiple views of the budget to ensure that the budget incorporates the sales of different regions as well as different products. This will give room for the identification of nons of such instances include having different payment schemes for employees who are at the same level, failure of appraisal systems, and poor resources for work. These factors will ultimately reduce the morale of employees henc e reducing their performance. It is thus the role of sales managers to identify and eliminate such factors to ensure that the operations of all employees are as per the expected standards of the firm. This will increase the ease at which the firm as well as its sales force will achieve its short term and long-term goals and objectives. Sales Force Compensation As it has been discussed before, compensation is an essential aspect that determines the performance of an individual. This is because, most sales representatives are optimistic regarding the compensation package that they will receive during the time that they will commence their work on a given organization. Employees usually regard a compensation package that will be able to carter for their needs and reflects their level of employment, skills and expertise (Bernardin 91). It is with regards to this that GE Appliances takes this factor into consideration to ensure that the process of designing the compensation package refle cts the employment level of an individual, his/her qualifications and the effort that an employee puts to the firm. Additionally, the firm recognizes the fact that employees regard the level of loftiness that they get from their compensation. It is with regards to this that the firms also puts a lot of care while designing the compensation packages of various employees who are at the same level of employment. Thus, the first step that sales managers consider while developing compensation packages is the preparation of job descriptions of the sales representatives. At GE Appliances for instance, sales representatives may be involved in the selling of kitchen appliances, dishwashers, washing machines or marketing of these products to either businesses or customers. Therefore, it is evident that these employees conduct different tasks and hence their compensation should be different. The sales managers then need to measure the job description of an employee to the sales targets. Here, the sales managers need to consider factors such as the number of sales made, number of new customers introduced, volume of goods sold and the revenue generated by an employee. Once this has been done, the sales manager then needs to determine the categories of compensation. Usually, the education background, skills and expertise play a critical role in the development of these categories. Finally, the sales manager should then develop a compensation plan that includes all the employees and reflect the effort that they have put in conducting the activities of the firm. These compensation packages should not be too little or too much. They should effectively reflect the effort, skills and expertise of an employee. In addition to this, sales managers should also give sales employees incentives for the extra work done or effort put. Bernardin, John. Human Resource Management. New York: McGraw Hill, 2008. Print. Ghosh, Nathan. Management Control Systems. New Delhi: Prentice-Hall, 2005. Print. Ingram, Thomas. Sales Management: Analysis and Decision Making. New York: M.E. Sharpe Inc., 2009. Print. Jackson, Ralph. Sales and Sales Management. 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