SALES CONTESTS

A Sales Contest is a special selling campaign offering incentives in the form of cash, prizes or awards beyond those in the compensation plan. Purpose is to provide extra incentives to increase sales volume and / or more profitable sales volume. Fulfills individual needs for achievement and recognition (Herzbergs Motivation-Hygiene theory) or for esteem and self-actualization (Maslows Hierarchy of Needs).

Develops team spirit, boost morale & make personal selling efforts more productive

SPECIFIC OBJECTIVES
To obtain new customers To obtain larger orders per sales call To push slow-moving items, high-margin goods or new products. To overcome seasonal sales slump. To sell more profitable mix of products. To improve the performance of distributors sales personnel. To promote seasonal merchandise. To obtain more product displays by dealers. To get reorders. To promote special deals to distributors / dealers.

CONTEST FORMATS

DIRECT
Contest theme describing the specific objective e.g.

Lets go after new customers

NOVELTY
Uses a theme, which focuses on a current event e.g.

Lets hunt for hidden treasure (new customers) Lets start panning gold (more profitable orders)

CONTEST PRIZES

Cash Merchandise Travel Special Honors or Privileges

CONTEST DURATION CONTEST PROMOTION

MANAGERIAL EVALUATION OF CONTESTS

The Contest versus Alternatives Short- & Long-Term Effects Design Fairness Impact on Sales Force Morale

OBJECTIONS TO SALES CONTESTS

Sales people are paid for their services and there is no need to reward them further for performing regular duties. High caliber & more experienced sales personnel consider contests as juvenile & silly. Contests lead to increased returns & adjustments, overstocking of dealers. Bunching of sales during the competition and sales slumps occur both before & after the contest. The disappointment suffered by contest losers lead to general decline in sales force morale. Contests are temporary motivating factors & if used frequently they have a narcotic effect. Competitive atmosphere weakens team spirit.

SALES FORCE MANAGEMENT PROCESS

Company Goals are defined and appropriate objectives for the sales department, are derived. To facilitate achievement of objectives, departmental policies are formulated and plans designed. To execute the policies and implement the plans, promotional programs & campaigns are mapped out and other needed actions, such as making changes in the sales organization are taken. Various sales department activities are coordinated with each other and with related activities performed by other organizational units and middlemen.

SALES FORCE MANAGEMENT PROCESS

Quantitative performance standards are set and criteria for appraising qualitative aspects of performance are selected. Actual performance is recorded. Actual performance is compared with quantitative performance standards and qualitative performance criteria and judgment is reached on the significance of the variations. Indicated actions are taken after deciding:
To take no action at this time. To increase the degree of attainment of the objectives. To revise the policy and / or plan, or the various strategies used in their implementation to better fit the achievement of objectives. To lower or raise objectives or the standards and / or criteria used in measuring their degree of attainment to make them more realistic.

SALES FORCE MANAGEMENT PROCESS

The last four steps of the above process have to do with EVALUATING & SUPERVISING and constitute what is known as CONTROL.

PERFORMANCE STANDARDS
Requires consideration of the Nature of the Selling Job i.e. sales job analysis. They measure progress made toward achievement of sales department objectives which could vary with changes in the companys marketing situation.

Quantitative Performance Standards provide description of what the management expects by defining performance aspects being measured and the measurement units.

Specific company standards could be a combination of the following:

Quotas Selling expense ratio Territorial net profit or gross margin ratio Territorial market share Sale Coverage effectiveness index Call-frequency ratio Calls per day Order call ratio Average cost per call Average order size Non-selling activities

Qualitative Performance Criteria

Qualitative Performance Criteria are used for appraising performance characteristics that affect sales results specially over the long-run which defy exact definition but whose degree of excellence can be evaluated only subjectively. The measurement could be on continuous or discrete point scales These could be a combination of the following:

 Job Factors

Product Knowledge Awareness of Customer Needs Relationship with Customers Number of Sales Calls Quota Performance Service Follow-up

Personal Factors

Punctuality General Attitude Dress & Appearance Diligence Cooperation Accuracy Adaptability Reliability Strongest Point Weakest Point

RECORDING ACTUAL PERFORMANCE

Define Information Needs based on Performance Standards & vice versa Determine Sources of Information Sales & Expense records Reports of Sales Personnel & lower levels of Sales Management Collect the Information

SYSTEMS OF FIELD SALES REPORTS

Purposes of Field Sales Reports To provide data for evaluating performance To help sales person plan the work To record customers suggestions, reactions & complaints To gather & record information on competitor activity To report changes in local business & economic conditions To log important information about territory to take care of change in sales person looking after the territory To keep the mailing list updated To provide information required by marketing research

Types of Sales Force Reports

Progress or Call report Expense report Sales work plan New-Business report Lost sales report Report of Complaint and / or adjustment.

Reports from Field Sales Management Actual achievement versus planned Individual personnel performances Sales meetings Complaints Competitor information Local economic conditions.

 Number of Reports
Minimum necessary to produce the desired information.

Design & Construction of Reports

Consistent with purpose & short as possible Easy checking-off, convenient size & shape Can be easily summarized

CONTROLLING SALES PERSONNEL THROUGH SUPERVISION

Conditions under which Supervision is needed
Sales personnel turnover rate excessive High turnover of accounts Increased complaints from customers Mail or phone orders increasing for no known reasons Low ratio of order to sales calls Total number of calls very low or very high Increasing ratio of selling expenses to sales Low morale, negative attitude to company, lack of enthusiasm.

Who should supervise?

Sales supervisor Branch Manager District (Regional) Manager Assistant / Sales Manager from HO.

DISTRIBUTION NETWORKS
Most producers do not sell their goods directly to the final users. Sets of interdependent organizations involved in the process of making a product or service available for use or consumption is a MARKETING CHANNEL. In-between intermediaries, performing different functions, constitute the marketing (trade or distribution) channel. Wholesalers & Retailers buy, take title & resell the goods MERCHANTS. Brokers, Manufacturers Representatives, Sales Agents search for customers & may negotiate on producers behalf but do not take possession AGENTS. Transporters, Warehouses, Banks & Advertisers assist in the distribution process but do not negotiate or take possession FACILITATORS.

CONSUMER & INDUSTRIAL MARKETING CHANNELS

0 level Manufacturer 1 level Manufacturer 2 level Manufacturer
Wholesaler

3 level Manufacturer
Wholesaler
Jobber

Retailer

Retailer

Retailer

Consumer

Consumer

Consumer

INDUSTRIAL MARKETING CHANNELS

0 level Manufacturer

1 level Manufacturer

2 level Manufacture r Manufacture r

Representativ e

Industrial Distributor Consumer

Industrial Distributor Consumer

SETTING UP DISTRIBUTIVE NETWORKS

ROLE OF THE MANUFACTURERS SALES FORCE Sales Departments are the initiators of the co-operative programs Sales representatives regarded as the Company Communication & Interpersonal-relations skills are important. OBJECTIVES & METHODS OF MANUFACTURER DISTRIBUTION NETWORK CO-OPERATION

Building Distributive Network loyalty to the Manufacturer Appraisal of manufacturers policies and their implementation Analysis of communication System. Stimulating Distributive Outlets to greater selling effort Changing policies

Sharing promotional risks with dealers

Using forcing methods Incentives to the Distributive outlet Incentives to the distributive outlets sales personnel Incentives to ultimate consumers.

 Developing Managerial efficiency in Distributive Organizations

Dealer training programs Assistance in Sales Force management Advice & assistance on general management problems Shelf-allocation programs Missionary sales personnel.

Identify Source of Supply at Final Buyer Level

Local Advertising Point-of-purchase identification.

DISTRIBUTIVE NETWORK CHANGES & MAINTAINING RELATIONS

Evolution of new types of distributive outlets Conflict in interests with the old existing network Best policy neither to assist nor to throw roadblocks in the way of the newer institutions If the new types are capable of becoming important outlets for the product, changes in the marketing channels & sales policies should be considered.