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USE OF SALES FORCE: AN INDISPENSABLE STRATEGIC MARKETING OPTION IN THE INDUSTRIAL AND COMMERCIAL PRODUCTS INDUSTRIES IN NIGERIA Asiegbu, I.F. (Ph.D)1; Ozuru, H.N.2 and Awah H.O. Department of Marketing, Faculty of Management Sciences, University of Port Harcourt 1 2 Email: [email protected] Email: [email protected] Abstract This paper presents the use of sales force as a veritable means of achieving sustainable trust and commitment in the new millennium business environment in Nigeria. It distinguishes sales force from other sales people. The paper identifies the role of sales force in modern marketing and the situations in which its use is not compromised, but rather paramount. It recommends the use of sales force, especially, in industrial and commercial products industries where trust and commitment are the bedrock for enduring marketing exchange relationships. Introduction Changes in the global market place, which is mostly competitive and customer-related forces, are dooming the traditional sales attitude. The emphasis of modern marketing has thus, shifted from single transaction to a long-term focus. The system has been found to increase customer 61 Sustainable Human Development Review, Vol.2, No.1, March 2010 product turnover and also allow the retailer sell the inventory before paying for it (Galea and Wiens, 2002). In the purchase of high ticket and high involvement products, customers increasingly want to have enduring relationships with trusted people who offer in-depth counselling and assistance on purchasing decisions, help find imaginative solutions to problems, support them within the sales people’s companies, and have high ethical standards. Such relationships are especially valued by organizational buyers, who turn to partnership relations with vendors as a means of gaining sustainable competitive advantage. This paper is of the view that successful customer relationship can only be achieved when a company uses personal selling, which makes it possible for a company’s paid representatives to meet face-to-face with prospects for the purpose of initiating, building, and sustaining mutual exchange relationships. In this regard, the use of sales force becomes critical in the industrial, commercial, and domestic products industries in Nigeria. Understanding the Sales Force Competitive Business Environment in the Nigeria The two basic concerns of businesses in any economy are the production of goods and services and marketing of those goods and services. The success of a marketing system in this millennium that is rife with stiff competition is largely dependent on the ability of individuals in organizations to identity and respond to customer changing needs more promptly, effectively, and efficiently than competitors. The basic role of marketing in an organization is to generate sales. Marketing activities are, therefore, imperative if sales must be generated to sustain the organization. Marketing exchange is the core of marketing. According to marketing concept, the key objectives of marketing exchanges are to satisfy needs of the individuals and organizations involved. It, therefore, follows that as a firm begins to adopt the marketing concept, it typically sets up a separate department whose primary objective would be to satisfy customer needs. 62 Use of Sales force as a Strategic Marketing Option Sometimes, these departments are sales departments with expanded responsibilities. While some companies adopt expanded sales department structure, others structure their entire organizations into marketing organizations having a company-wide customer focus. In marketing organization structure, every employee is concerned with and committed to customer satisfaction. However, to achieve customer satisfaction, create, and maintain profitable marketing exchange relationships with customers, organizations find it necessary to engage people to represent them in the exchange relationships. These people personally sell the company’s products, and as such, their preoccupation is selling. Selling is one of the oldest professions in the world. Selling is giving something (goods, property) in exchange for money. Exchange is the giving or receiving of one thing in return for something else. It is reciprocal giving and receiving of things of the same value (Webster, 1997: 330). Marketing exchange is defined as the transfer of something tangible or intangible, actual or symbolic, between two or more social actors (Bearden et al, 1995: 12). The basic purpose of marketing is to encourage economic units to transfer something of value to each other. The two parties involved in the marketing exchange are the company and the customer. To carry out this exchange and sustain relationships with customers, firms engage sales persons to act on their behalf. A salesperson is defined as an individual acting for a company by performing one or more of the following activities: prospecting, communicating, servicing, and information gathering (Kotler and Armstrong, 1996: 531). The people who do the selling go by many names, such as sales force, order getters, order takers, salespeople, sales representatives, account executives, sales consultants, sales engineers, agents, district managers, and marketing representatives. A company’s sales force is a team consisting of its stock of salespeople (Asiegbu, 2009: 51). The pre-occupation of sales force is 63 Sustainable Human Development Review, Vol.2, No.1, March 2010 order-getting. This paper maintains that sales force is indispensable in industrial, commercial, and domestic products marketing in Nigeria. Sales Force Role in Modern Marketing in Nigeria and Situations in which Its Use is Imperative The role of the sales force depends, to a large extent, on whether a company is selling directly to consumers or to other businesses. In consumer sales, that is, selling to retailers, the sales force is typically concerned simply with taking and closing orders. They are merely order takers. The individuals involved in consumer sales or order taking may provide customers with some product information, but are often not concerned with creating demand and maintaining long-term customer relationships. For instance, paint producers in Nigeria, such as Meyer, Berger, Saclux, Lexus, Peacock, keep order takers at their deports to replenish their customers’ stocks. The focus of this study is not on these consumer sales people or order takers. This paper is concerned with sales force or order getters engaged in the sale of industrial, commercial, and domestic products in Nigeria. The sales force takes on a completely different role in businessto-business sales. Industrial sales forces, for example, may be required to perform a variety of functions. These may include prospecting for new customers and qualifying leads, explaining who the company is and its products’ benefits, closing orders, negotiating prices, servicing accounts, gathering competitive and market information and allocating products during times of shortages. Aluminum roof companies, banks, insurance firms, pharmaceutical companies in Nigeria engage the services of sales force or order getters to carry out these functions on their behalf. This paper is concerned with the industrial and commercial sales force. Industrial products include those products which organizations sell to other organizations for reuse in the production of entirely new products. Thus, the products sold are intermediate in nature, for example chemicals, building and road construction materials, furniture making materials, baking ingredients (condiments), and photographic 64 Use of Sales force as a Strategic Marketing Option materials. Commercial products are products that are sold to intermediaries for resale to final consumers, for example, electronics, household and office consumables, automobiles, labour supplies, electricity generating sets, and others. Industrial sales force is made up of people who are preoccupied with creating demand, establishing, building, and sustaining long-term exchange relationships between the firm and its valued customers. Thus, the concerns and activities of the sales force tend to vary in each type of business market – industrial sales and consumer sales. Large sales forces are required in industrial selling (Encyclopedia of Business, 2000: 1,566). Sales force is involved in personal selling activities of an organization. Personal selling is the direct communication between paid representatives and prospects that leads to transaction, customer satisfaction, account development, and profitable exchange relationships. The use of sales force (and, thus, personal selling), is critical to the sale of many goods and services, especially major commercial, industrial products and durable products. Specifically, Dalrymple et al (2004) and Boone and Kurtz (2004) have identified situations that necessitate the use of sales force as an appropriate promotion strategy. Some of these situations include when: - consumers of a company’s products are concentrated geographically; purchase orders are large at each buying occasion; products are expensive, that is, the exchange involves high ticket items; products are technically complex and require special handling and care; trade-ins are involved frequently; channels of distribution are short; the number of potential consumers are relatively small; sales-push distribution strategy is employed; 65 Sustainable Human Development Review, Vol.2, No.1, March 2010 - purchases are frequent, making dialogue between the buyer and seller inevitable; and the sale involves high involvement goods. In the above situations, sales force creates value for both the organization and its customers. On the firm side, sales force creates value for the firm by collecting information on customers needs, wants, references, and problems so that the firm can create better products. Sales force also gets new customers, service existing accounts, handle transactions, and increase sales and profits. An effective sales force consists of individuals who can relate well to decision makers and help them solve their problems. On the customer side, sales force creates value for customers by providing useful information to help them make better purchase decisions. Sales force can make shopping and purchasing more convenient, enjoyable, and at lower transaction costs by reducing the search time and efforts involved. They can build long-term exchange relationships that benefit both the customers and the company by handling customer problems or complaints promptly and effectively. Relationship marketing has shifted attention from “closing” the singular sale to creating the necessary conditions for long-term relationship between the firm and its customers, which breeds successful sales encountered in the long run. This paradigm shift has made the role of the sales force to be drifting from the traditional aggressive and persuasive selling to a new role of relationship sales management (Donaldson, 1998). This change in focus is designed to facilitate the transaction of the sales force tasks from selling to advertising and counseling, from talking to listening, and from pushing to helping as suggested by Pettijohn et al (1995). The new reality of relationship marketing directs sales force to develop long-lasting relationship with their customers, based on mutual trust and commitment. Each selling occasion is an opportunity to strengthen the existing relationship between them and their customers, and increase the loyalty of the customer to the firm. 66 Use of Sales force as a Strategic Marketing Option Relationship selling involves creating customer value by addressing important customer problems and opportunities through a supplier customer relationship that is much more intimate than that of traditional transactional selling. Conclusion and Implications In conclusion, industrial sales force is quite different from consumer sales people or order takers in terms of functions. The pre-occupation of industrial sales force is to convert potential customers to actual buyers and establish and maintain mutual trust and commitment that pave way for enduring exchange relationships between the buying organization and the selling organization. It functions as the agent of communication between them by liaising with its company and the customers. These mutual trust and commitment are together indispensable in a wide range situations in industrial and commercial products marketing. This implies that for the industrial and commercial products firms in Nigeria to be strategically competitive, they must engage the services of sales force in customer care, value delivery, market orientation and customer relationship management. References Asiegbu, I. F. (2009), “Sales Force Competence Management and Marketing Performance of Industrial and Domestic Products Firms in Nigeria,” Ph. D. Dissertation presented to the Post Graduate School, Rivers State University of Science and Technology, Port Harcourt. Bearden, W. O.; Ingram, I. N. and Larforge, R. W. (1995), Marketing Principles and Perspectives, Chicago: Irwin. Boone, L. E. and Kurtz, D. L. (2004), Contemporary Marketing, 11 ed., Australia: Thomson, South Western. Kotler, P. and Armstrong, G. (1996), Principles of Marketing, 7 ed., New Jersey: Prentice Hall International Inc. 67 Sustainable Human Development Review, Vol.2, No.1, March 2010 Dalrymple, D. J.; Cron, W. L. and Decarlo, T. E. (2004), Sales Management, 8 ed., New Jersey: John Wiley and Sons, Inc. Donaldson, B. (1998), Sales Management: Theory and Practice, 2 ed., Basing Stoke: Macmillan. Encyclopedia of Business (2000), 2 ed., Detroit: Gale Group. Galea, A. and Wiens, C. (2002), “2002 Sales Training Survey,” Sales & Marketing Management, (July), 34-37. Pettijohn, C.; Pettijohn, L. and Taylor, A (1995), “The Relationship between Effective Counseling and Effective Behaviours”, Journal of Consumer Marketing, 12: 5-15. Webster, F. E.; Malter, A. J. and Ganessan, S. (2005), “The Decline and Dispersion of Marketing Competence,” MIT, Sloan Management Review, 46 (Summer):.35-43. 68