Relationship of a Salesperson With His Customers  Case Study

Excerpt from Case Study :

relationship of a salesperson with his customers. The authors have tried to formulate what factors into this relationship. The main focus is the right type of attitude and interaction between the sales person and the customer, which helps to build a long-term relationship between the two.

'Do communicator characteristics such as similarity and expertise, which have typified the short-term transaction perspective of previous sales research, contribute to sustaining an enduring relationship? How important are relational behaviors such as cooperative intentions, contact intensity, and mutual disclosure in building and maintaining long-term relations?' (Crosby, Evans, & Cowles, 1990)

However, the whole of the paper is based on how the customer looks at this relationship. A model has been made which helps to make it easier to understand the intricacies of a services salesman.

'The model is tested in the context of the agent policy holder relationship involving life insurance. By selecting relationship quality as the study's focal variable, we are narrowing our concern to those service settings in which relationship marketing is appropriate and the salesperson assumes the key implementation role.' (Crosby, Evans, & Cowles, 1990)

Research theory

It is believe that the buying and selling of services is more difficult than tangible products. There are many things which factor into selling to customers directly. There are many different writers who have thought out and written about selling to customers in a face-to-face dialogue.

'Intensify relationships by becoming your customer's primary provider. Insurance agents as well as banks have long talked about "cross selling." For the most part, it's been talk and little more. Auto insurance is with one agent, a home owner's policy with another, while life and health are with others. This is inefficient for the customer and wasteful for an insurance agency.' (Graham, 1997)

It is believed that selling services really need to have a good relationship with the customer. This helps in a lot of things. It becomes really crucial when the sale is of very complex nature. There needs to be familiarity between the seller and the customer for repeated sales. This can be done in many different ways.

When services are sold, they are being produced and consumed at the same time. (Kasper, Helsdingen, & Vries Jr., 1999)

It is always easier to create a relationship with a customer when there is a service sale involved. The customer is always an important part of the sale. It all depends on how the customer perceives the sales pitch and the salesman during the sale and interaction. This is what the research is about. How the customer grades the salesman depends on many different thing. This then increases the chances of a long-term relationship between the customer, salesperson and the service.

Trust is another factor which plays an important part in the buying and selling of the product. Many researches have carried out researches which show how important trust is when people are interacting with a sales person.

The research has labeled six factors which play a role in service selling. They are

1. Similarity

2. Service domain expertise

3. Relational selling behavior

4. Relationship quality

5. Sales effectiveness

6. Anticipation of future interaction

These are interlinked with each other which then result in the final relationship status between a salesman and a customer.

Methodology

The whole aim of the paper was to test the viability of the model which was made. A survey was conducted for this purpose. The paper was based on life insurance, as this is one of the most service-based product in the market.

There are many factors which are present in the selling of life insurance. It is very important to maintain a personal relationship with the customer. 'Whole life insurance fulfills the conditions of 'personal relationship marketing context' in all respects. First, the service is both highly complex and highly intangible.' (Crosby, Evans, & Cowles, 1990)

Another main thing which is present in a life insurance sale is, customization. This is done by all the different agents, 'one of the primary functions performed by life insurance agents is service customizations. Agents are trained to conduct detailed "fact finding" (needs assessment), to provide explanations and advice about policy features, and ultimately to present a personalized proposal to the client.' (Crosby, Evans, & Cowles, 1990)

Next there is the factor of repeated interaction with the customer. This is another factor of the said model of the paper. this is another thing which has to be kept in mind all the time. 'Whole life insurance is almost always sold by an agent who, I 80% of the cases, is the customer's only contact. Interactions tend to be ongoing rather than single encounters because insurance policies must be updated periodically and sometimes replaced.' (Crosby, Evans, & Cowles, 1990)

Hypothesis

The main aim of this paper is to find out if the model is credible of not, in terms of sales of services. All other factors are held constant. To test this model, the insurance industry has been chosen.

Instruments

Surveys were used to conduct this research. Primary and secondary data was also used in this research.

Sample

The sample consisted of U.S. household's heads, between the ages of 25 and 44. They were supposed to have one or more than one whole life policies.

'The sample frame consisted of members of a national panel of qualified policy holders who were participating in a series of interviews about their insurance attitudes, experiences and coverage.' (Crosby, Evans, & Cowles, 1990)

Findings

At the end of the research, it was found that the all but one of the factors, named in the model, were as important as hypothesized. As per the research, the data was analyzed using the method of covariance. This allowed for the relationship among the factors named in the model, to be tested.

'The standardized solution estimated by the LISRELVI program was used for interpreting the structural relations results. As implied by the path coefficients, relational selling behavior exerted a strong, direct influence on the quality of the customer-salesperson relationship (.53). Customer perceptions of a salesperson's expertise in the service domain had a moderately strong effect (.30) on relationship quality whereas similarity had no demonstrable influence. Results suggest that perceived similarity and expertise both played an important role in determining sales effectiveness (.47 and .38. respectively), but that the outcome effects of relationship quality were limited to the customer's expectation of future interaction with the salesperson (.43). Sales effectiveness does not appear to have influenced anticipation of future interaction (non-significant path),' (Crosby, Evans, & Cowles, 1990)

The findings make it safe to assume that the factors named previously in the paper, have a significant relationship. It can be seen that the customer perception is of great importance. It also proves the hypothesis that customers do care about things like future contact with a sales person, when they gauge the sales person.

'The continuity of interaction that relationship quality provides then creates for the seller On going opportunities to identify the customer's unmet needs and propose new business. Ultimately, though, the salesperson's ability to close on these sales opportunities will depend on the salesperson's attractiveness and competence, factors that make him or her a persuasive source for the buyer.' (Crosby, Evans, & Cowles, 1990)

Implications

Through the research a few implications have come to light. They are as follow:

Hiring of sales person can be done more easily by screening the social abilities which help in maintaining long-term relationships.

Trust building should be more focused on. This is an important part of the sales pitch.

Relational selling can be encouraged more than before now.

Contact people should be sensitized to the nature of the social process underlying interpersonal relationship development. (Crosby, Evans, & Cowles, 1990)

Teams can be used instead of individuals when the knowledge…

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