Sales Management Summarize the Case.

Sales Management

Summarize the case.

Pergault is a company with 500,000 different MRO products sold to customers in North America. Even though smaller businesses represent about 80% of the customers, the aggregate sales generated from catalog and online sales is only about 20%. Much larger businesses make up the remaining 20% of customers who purchase 80% of the company's products. These orders are handled by a direct sales force.

CEO Celia Fiorni wants to increase online sales to provide better customer service (quicker and higher quality order processes) and to reduce costs.

However, Ken Sutton, a sales manager reports that the sales force has several objections. They are concerned with replacing face-to-face interactions with a Web site that is viewed by some customers to be complicated and confusing. Further, they are threatened by online ordering, fearing a reduction in commissions and a possible downsizing of sales jobs. Sutton acknowledges that there hasn't been much of an effort to train its own sales force in online ordering.

Formulate answers to questions 1 and 2 at the conclusion of the case.

What advice should sales manager Ken Sutton give to his company president, Celia Fiorni, in order to improve her e-commerce plan and make it successful?

Increased emphasis of the online channel is the right thing to do, but issues of overlap and conflict must be dealt with. Channel conflict is inevitable when two or more channels of distribution sale products to the same customer. One way to minimize this conflict is to design a channel strategy that clearly matches a specific type of customer (a small or a large business) or product (simple or complex) with a chosen distribution channel. Your sales and marketing strategy should then allocate products to the best distribution channel or direct the right prospect to the right channel and the right channel to the right prospect.

The impact of online sales on incentive structures warrants careful consideration. For example, it might be possible to raise quotes with the expected sales increase generated by the Web, and pay the sales force for all business closed in their territories. or, salespeople may best be allocated to larger businesses because the Web can service smaller companies more effectively and cost efficiently. This will allow sales people to focus their tme on developing relationships with the larger, more complex and more profitable accounts.

Finally, the Web site must be a wonderful tool for the customer. This means that issues related to ease of use (the ability to easily locate products and a quick and easy ordering process) must be resolved. Because the sales force indirectly influences adoption of online orders, their feedback should be embraced and training must be provided.

What should Ken Sutton do to make his salespeople more accepting of the new initiative?

Once the above issues are worked out, Sutton should position the Web site as a boon for the sales person's income and productivity. Allowing customers to take care of routine orders and quotes online would free the sales reps to develop deeper relationships and win new customers. and, an online sales channel means more business because it will offer great customer service as a way to distinguish the company from its competitors. Thus, the pitch should include talking points for describing it to customers.

Describe the importance of customer relationship management (CRM) to sales management.

CRM is important to sales management for many reasons (Customer relationship management, TechTarget). It helps them optimize information shared by multiple employees and streamlines business processes such as taking orders. and, it allows the formation of individualized relationships with customers, with the goal of improving customer satisfaction and maximizing profits. It does so in part by providing employees with the information and processes necessary to know their customers, understand their needs, and effectively build relationships between the company, its customer base, and channels. and, it helps drive marketing efforts that increase the number of high quality leads for the sales team.

Identify different types of technology that the organization in your case study could use to enhance their selling functions and CRM techniques.

There are many technologies that could help G.W. Pergault enhance their selling functions and CRM techniques. Examples applicable to incorporating the online sales channel include (Meister, Chambers and Fenner, 2001).

Integration across all channels -- a single view of the customer is important. This means tracking the various channels through which the customer interacts to understand the information requests at each point, track the status of any pending requests, and report on contact histories. With a common, unified view of the customer, the company can ensure more consistent service and follow-up.

Customer self-service -- by providing rich content around customer transactions and self-service activities such as frequently asked questions, bills, policies and product documentation, organizations can increase the value of their Web site to their customers. Many CRM systems provide a central online "knowledge base" to support customer self-service, while others rely on integrating disparate back-end systems within the organization.