1.2 Selling: Heartbeat of the Economy and the Company

Look around. Your computer, your car, your jewelry, your eyeglasses, and your cell phone—many of the things you own—were probably sold to you by someone. Now, think about things you can’t see, like your cell phone service, your Internet service, and your car insurance. Chances are, those services were probably sold to you by someone as well. Now that you think about it, you can see that selling is involved in life in so many ways. But did you ever think about the impact that selling has on the economy?

In the United States alone, almost 16 million people were employed in jobs in sales in 2008. This number includes retail salespeople and cashiers, insurance sales agents, real estate brokers and sales agents, and manufacturing sales reps just to name a few. According to the Bureau of Labor Statistics, that number will increase to almost 17 million people employed in sales and sales-related occupations by 2018, which represents a 6.2 percent increase from 2008. That translates to one in every ten people in the United States having a job in sales.^[1] Other estimates, such as the Selling Power Magazine’s annual report of America’s Top 500 Sales Forces in 2008, puts the total number of salespeople at the top 500 companies at over twenty million for the first time.^[2]

But the bigger story is the fact that many companies sell their products and services globally. Multinational corporations (MNCs), large companies that have operations, including selling, in several countries,^[3] such as Procter & Gamble, Dell, Reebok, and Kraft Foods, employed 32 million workers in 2007. ^[4]Although not all these employees are engaged in selling, the number helps provide some sense of relativity as to the proportional impact of international business. Most large MNCs have offices (including sales offices) in many foreign countries. This provides the company with the opportunity to become integrated into the culture, customs, and business practices of each country in which it has operations.

A large number of MNCs generate a significant portion of their sales from countries outside the United States. If you’ve traveled outside the United States, think about the products you saw. Companies such as Coca-Cola, eBay, Gillette, KFC, and Starbucks have a significant presence in foreign countries. Many companies expand selling to international markets for several reasons, including slow population growth in their domestic country, increased competition, opportunity for growth and profit, and sometimes, out of sheer necessity due to the fact that globalization is rapidly changing the economic landscape.^[5]

In the past, expansion to foreign markets was limited to those corporations that could make the investment required to locate offices and operations abroad. The Internet, however, has provided that same opportunity to small- and medium-sized companies, so that they may sell products and services internationally. Why would small companies want to do this? With only a one-to-five proportion of Internet users living in the United States, almost 80 percent of Internet users live in places abroad; thus, there is a much larger market to be found by way of the Internet. Before you take your lemonade stand global, however, remember that selling internationally is not as simple as just setting up a Web site.

Language, shipping, currency exchange, and taxes are just some of the costs and considerations necessary for selling products and services internationally via the Internet. To help companies overcome these barriers of doing business internationally, organizations such as e-commerce service provider ScienceSoft offer technology solutions that manage these important components of international selling.^[6]

Think about the possibilities. When companies such as Overstock.com want to sell globally, companies like ScienceSoft have a selling opportunity. In other words, selling products and services can generate more opportunities for selling other products and services in the future. When companies and salespeople think creatively and see the environment through the customer’s eyes, they can identify selling opportunities that might not otherwise exist. This is a basic tenet of selling, both domestically and internationally.

The Internet: Power to the People

The Internet has been a game-changer for selling in many ways. Just like the Internet expands the reach of a company to virtually anywhere in the world, it also provides customers with access to information, products, and services that they never had before. In some industries, the Internet has virtually eliminated the need for a salesperson. Travel agents are no longer the exclusive providers of reservations and travel plans. Music stores are almost extinct. Newspaper want ads have almost vanished. In other industries, the relationship between the salesperson and the customer has changed dramatically.

The power has shifted from the seller to the buyer. Take, for example, the auto industry. It used to be that when you wanted to buy a car, you went to a car dealership. The salesperson would show you the cars, take you out on a test drive, and then negotiate the selling price when you were ready to buy, holding the dealer invoice close to the vest. Today, customers may e-mail a car dealership to set up an appointment to drive a specific car after they have researched different models of cars including features, benefits, competitive models, editor and customer reviews, competitive pricing, and dealer invoice pricing. In some cases, the customer may know more than the salesperson.^[7]

Sales organizations are embracing a movement called Sales 2.0 used to describe the role of the next generation of the Internet in the selling process including social networking, “mash-ups,” communities, and collaboration. You may have heard of Web 2.0, the second generation of the Internet, which includes interactivity, community, and on-demand information. Sales 2.0 is a term that appropriately describes a new way of thinking about the role of the Internet in the selling process as it encompasses the impact of constantly changing technology and multiple electronic devices, “mash-ups” of different sources of information, and user-generated content on sites like Facebook, LinkedIn, YouTube, and Twitter.

According to Tim Sullivan, director of intellectual property and information for Sales Performance International, these Internet-based changes pose new implications for sales. Educating customers is no longer the primary function of the salesperson. Customers are actively involved in engagement, interaction, and collaboration to seek information. Salespeople need to understand the power of collaboration both inside their organization and with their customers, so that they may participate in the online conversation, enabling them to better deliver value. Just as customers use blogs, wikis, and social networking as tools to learn about a product, companies can use these tools to learn about customers (and what they want and need). It’s a new mindset and new technology tools are constantly changing the landscape—salespeople must be prepared to adjust their reactions accordingly.^[8]

The shift of power to the customer is underscored by Gerhard Gschwandtner, founder and CEO of Selling Power, Inc. According to him, “Sales 2.0 gives the customer a 360-degree view of the company and provides sales organizations with a variety of tools that help manage that two-way communication process.^[9] Sales 2.0 takes the selling process to the next generation.

Sales Is Not a Department, It’s a State of Mind

Those are the words that signal success in selling. They seem simple, but according to Gerry Tabio, bringing a sale – the activity of selling a company’s products and services to fruition – is “not just about celebrating the sale; it’s about celebrating the growth of the customer.”^[10] The most successful companies work to build and sustain relationships with the customer at every touchpoint.

At every touchpoint meaning any point in which the customer comes in contact with a company, such as in person, by phone, by e-mail, Web site, invoice, advertising, etc. Consider selling the job of everyone in the organization. In other words, although there are specific functional departments such as sales, marketing, operations, human resources, finance, and others, everyone in the organization is focused on the customer. This is called a customer-centric organization where all employees are focused on anticipating and meeting the needs of the customer.^[11]

You might wonder why all companies aren’t considered customer-centric. After all, if they were in business to sell products and services to customers, it would make sense that they would be customer-centric. However, you have probably encountered companies that aren’t really focused on the customer. How many times have you heard this message while you were on hold to talk to a salesperson or customer service representative, “Your call is important to us. Please stay on the line for the next available representative”? Being on hold and hearing a recorded message hardly makes you feel as if you are important to the company.

It’s All about the Customer

Being customer-centric means insisting on accountability. Although everyone is focused on the customer, every employee is part of a department or function. Each department has goals and accountabilities. In a true customer-centric organization, the departments work together to satisfy the needs of the customer and achieve the financial objectives of the company. Most companies have core functions or departments such as sales, customer service (sometimes it is included as part of the sales department), marketing, operations, finance, human resources, product development, procurement, and supply chain management (also called logistics).

Departments such as finance and human resources are called support (or staff) functions that provide services that support those that are on the front lines with customers, such as human resources, finance, and marketing. This department is also called a staff function since they provide support for those that are on the front lines such as sales and customer service (these departments are also called line functions as they are part of a company’s daily operations.^[12] In a customer-centric organization, the focus on the customer helps prevent organizational “silos” (i.e., when departments work independently of each other and focus only on their individual goals).

The sales department is the heartbeat of every company. According to Selling Power Magazine, the manufacturing and service companies listed on its “Power Selling 500 Report” generate $6.7 trillion dollars in sales annually. Each salesperson supports an average of 12.9 other jobs within the company.^[13] This means that the level of sales that are generated by each salesperson actually pays for the roles in human resources, marketing, operations, and other departments. It makes sense that the salespeople fund the operations of the company. After all, it is a salesperson with whom you interact when you buy a Nissan Cube, lip gloss at Sephora, or an interview suit at Macy’s. The people in the sales department “ring the cash register” (whether the business has a cash register or not).

They are responsible and accountable to deliver sales to generate revenue and profit, which are required to operate and to invest in the company. In fact, the sales department is considered so important that even in this difficult economy, companies should continue to fill open sales positions even if they are not hiring in other departments, according to Dennis J. Ceru, a professor of entrepreneurship at Babson College and the president of Strategic Management Associates, a consulting firm in Wellesley Hills, Massachusetts.^[14]Without a healthy and strong sales department, companies can wither and die.

Power Point: Lessons in Selling from the Customer’s Point of View

Role Reversal
How would you feel if you wanted to buy a new car, but every sales rep you called was in a meeting?

Brad Lathrop, a sales professional, learned the hard way about how a customer feels in this situation. When he was in the market for a new car, he called several dealerships. Every receptionist told him that all the salespeople were in meetings. The receptionist at the last dealership he called said the same thing, but added that if Brad would hold for a minute, she would get a salesperson out of a meeting. It’s no surprise that was the dealership where Brad eventually bought the car and learned a powerful lesson about selling.

Is It Sales, or Is It Marketing?

So you might be wondering, if the sales department interacts with customers, what exactly does the marketing department do? That’s a great question. Some people use the terms in tandem—sales and marketing—to refer to sales. Some people use the terms interchangeably and refer to marketing as sales. It’s no wonder that it confuses so many.

According to the American Marketing Association, marketing” is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large.^[15] In other words, it is the role of the marketing department to use the four Ps of the marketing mix (product, place, promotion, and price) to determine the brand message, which is ultimately communicated to customers. ^[16]  Then, the marketing department uses the elements of the promotional mix of advertising, sales promotion, public relations, direct marketing, interactive marketing, and personal selling to get the word out to customers.^[17] Marketers seek to motivate prospective customers to purchase by driving them to a Web site, store, phone, event, or another related, desired action. Essentially, marketing builds relationships between customers and the brand. When you see an online ad for Best Buy, get an email about the new release of the latest marvel movie on Blu-ray, post a comment on the Best Buy Facebook page, respond to a tweet from Best Buy on Twitter, see a newspaper insert, or an ad on television, or read about the opening of a new store near year you, these are all examples of marketing. They are designed to encourage you to engage with the brand and encourage you to take an action—visit the store, go to the Web site, or tell your friends about the brand.

When you go into the store or visit the Web site, it’s the sales department that takes over. A salesperson will speak with you (either in person in the store, online with live chat, or by phone) to determine what you need and to help you make the best decision by communicating product information (this printer is wireless), service information (we can deliver that tomorrow), warranty information (it has a 90-day manufacturer warranty), and other pertinent facts. The salesperson extends the relationship that was established with the marketing contacts and makes a personal connection with you. If you have a good experience, your relationship with Best Buy gets even better, and you are more likely to shop there again and tell your friends.

At times, however, sales and marketing don’t play well together. When organizations are not customer-centric, the departments may appear to have separate or conflicting goals. Marketing may feel that sales don’t follow up on prospective customers, or perhaps sales feels that the marketing efforts are focused on the wrong customers.

In addition to closing the sale (when the customer purchases the product or service), the salesperson has a very important role in the marketing process. Because the salesperson (in the store, online, or on the phone) is a primary touchpoint and a personal interaction with the customer, the salesperson is the brand in the eyes of the customer. According to Dr. David A. Shore of Harvard University, “The sales force is the most visible manifestation of the brand. Salespeople need to say with a singular voice, ‘This is who we are, and, by extension, this is who we are not.’ The critical element that power brands have is trust, and a sales force needs to become the trusted advisor to the customer.”^[18]

So now you can see that marketing and sales work hand-in-hand: one develops the brand and the other assumes the image of the brand. Neither works without the other, and the relationship between the functions must be transparent to the customer. There’s only one brand in the eyes of the customer, not two departments. When marketing and sales work well together, the customer experience is seamless.