Sales management originally referred exclusively to the direction of the sales force.
Later the term took on broader significance in addition to the management of personal selling.
Sales management meant all marketing activities, including advertising, sales promotion, marketing research, physical distribution, pricing, and product merchandising.
According to the definition committee of the American marketing association
Sales management meant “The planning, direction, and control of personal selling. Including recruiting, selecting equipping, assigning, routing, supervising, paying, and motivating as these tasks apply to the personal sales force”.
Many believed that marketing would make sales superfluous ultimately. But this belief proved wrong. The sunrise sectors like insurance, financial products, and information technology are all sales-driven. In this age of commodity brands and mass retailing even traditionally marketing-driven industries like FMCG and white goods have rediscovered sales.
Initially, sales management was equated with salesforce management. As time rolled on, sales management became broader.
The function of Sales Management
• Apart from the management of personal selling, it encompassed other marketing activities like advertising, sales promotion, marketing research, physical distribution, pricing, merchandising, and so on. However, the comprehensive broad function later got labeled as “Marketing Management.”
• Sales management involves the management of the salesforce. This is a personnel-type function.
• Sales management also organizes the selling effort. To do so, it creates a suitable organizational structure, with the appropriate communication system.
• Sales management interfaces with the distribution channels, and external public.
• Sales management provides critical inputs for the key marketing decisions like budgeting, quotas, and territory management.
• Sales management interfaces with other marketing functions while policies of these functions are being formulated.
According to Zoltners, Sinha, and Lorimar (Building a Winning Salesforce), the sales process is the most dynamic corporate undertaking.
Market conditions constantly change, as do customers’ wants, needs, and expectations. A company’s salesforce must be equally dynamic to stay competitive. Therefore, the business now invests enormous sums to develop their sales departments.
Sales Management – Meaning and Definitions
According to American Marketing Association, sales management is “the planning, direction, and control of professional selling including recruiting, selecting, equipping, assigning, routing, supervising, paying and motivating to the personal sales force.” It is also often referred to as management of the personal selling part of a company’s marketing function.
Sales is the only function in an organization that generates revenue or income for a company and hence it needs to be managed properly. The financial results of a company depend upon the performance of the sales department.
Objectives of sales management are as follows:
- Revenue Generation – One of the main objectives of sales management is to generate revenue for the organization. The sales department is solely responsible to bring in the money.
- Increase Sales Volume – Through efficient sales management, the organization wishes to increase the number of units sold. This will ensure that the production facilities do not remain idle and are utilized to the fullest.
- Sustained Profits – Sales management has the objective of improving the profits of the organization through effective planning, coordination, and control. Sales management strives to increase sales and reduce costs, this ensures good profits for the organization.
- Organization Growth – With sustained and continuous sales management techniques, the organization tends to gain market share and resulting in the growth of the organization.
- Market Leadership – With increased sales volumes and profits, ‘sales management’ enables an organization to become the market leader.
- Converting Prospects to Customers – Getting prospects to become customers is an art and a science, it requires good planning and sustained efforts. This is accomplished through sales management.
- Motivate the SalesForce – One of the core objectives of sales management is to motivate the sales force. Selling is a very stressful task, achieving sales targets can become very challenging. Therefore, the sales management task is to ensure that the sales force is continuously motivated through proper incentives and reward systems.
- Compliment Marketing Activities – Sales management’s task is to support the marketing functions of the organization. Marketing and sales need to go hand in hand to achieve the desired results.
Sales volume, contribution to profits, and growth are the three major objectives the sales function is expected to achieve. Though these are broad corporate functions to be achieved by the top management, sales contribute a great deal to achieving them.