Wear the badge of a Salesperson with pride

Last few days of 2017 and first few days of 2018 gave me few memorable experiences; sweet and sour. Let’s get over with the sour thing first. I was booked on a Indigo flight on 31st Dec and I was looking forward to being with my family in Delhi, however owing to bad weather the flight was cancelled. A short and crisp message from the airline left me stranded there. But that was not the service failure (we understand bad weather), the failure was that in such situation the service provider did not care for its customers – a call to the customer would have helped. My ticket was booked through premiermiles, a Citibank outfit and they did not even bother to send me a SMS (as per their record, I did travel on the flight which never took off!) A classic and not so pleasant example of a service operations failure. With so much of technology at their command!

Let’s get to the sweet experience. On Jan 2, I walked into a store of Himalaya Opticals and met a very helpful salesperson. While helping me in selecting a good frame he quickly realized that I was closing in on my choice. However, he also sensed that I was not very happy with my selection. Looking at my decision dilemma, he suggested that I postpone my purchase for three days as they were expecting more stock in the store and I will surely get what I was looking for. He was a smart salesperson who could have easily sold something to me that day itself. He chose not to do so but invited me to a later date. That set me thinking; why do good salespeople bet on their customers? How do they offset their risks and tradeoff short-term gains for long-term relationships with customers? To understand these questions, we need to consider the evolution journey for this profession called ‘Sales’.

Powers et al.(1987) published an interesting article chronicling the profession of selling before 1900. This paper provides a detailed review of how the profession evolved through different ages in the history. Here are some of the key points:

1. The Ancient World: Selling as an economic activity started with the idea of shortages and surpluses in the agriculture produce. The ‘Peddler’ was the first salesperson which did primarily two jobs; selling and holding the inventory. The salesperson would go house to house to sell their wares driven by the entrepreneurial spirit.

2. The Classical World: After the Greeks developed coinage system and formed commercial regulations, the markets got a structure: clusters of sellers in one place competing for customer’s business. The era saw the emergence of ‘Merchant Salesman” and Women Salesperson (Pea Soup Woman!).

3. The Dark Ages: It was during this period that Islamic traders started developing the profession and selling became a primary source of economic growth. A salesperson/merchant was considered a contributing member of the society.

4. The Middle Ages: Selling evolved as a career choice and people took this option for quick success. However, it was also realized that a career of the travelling salesman was not a pious existence.

5. The Renaissance: The salesman assumed different roles; auctioneer, trader, lecturer and even entertainer. He was considered wise and powerful people invested in his wisdom to increase their own treasuries. During this period of commercial re-awakening, merchant markets and fairs provided a fertile ground for the selling profession to grow further.

6. The Modern Age: Beginning of 18th century, a retail system started forming and technological inventions were taking shape. To complement these developments, advancement on sales practices was an important driver. Josiah Wedgewood, a Potter, can be considered one of the leading businessman in that era who implemented the idea of market expansion and coverage and served his markets by getting his ‘salesmen out on the road’. His use of company salesmen to execute his marketing plan including creative promotion was remarkable. He first coined this idea that distribution would be best serviced by the captive agents of the firm. Also, development in transportation and communication technology helped in realizing the idea of a fully integrated sales force. These developments in transportation and communication made salespeople more efficient.

Therefore, the evolution of sales profession provided a solid foundation for the development of the marketing paradigms in the 20th century. It is important to understand the linkage of marketing thought development and further evolution of sales profession in 20th century and beyond. Let’s take a closer look.
1. The Transactional Paradigm: Selling continued to be dominated by the idea of a transaction; a seller and a buyer and hence the exchange. A large part of 20th century, a salesperson job continued to be a ‘peddler’; to sell and manage inventory. Yes, the sales organizations crafted the selling job in a way that required salespeople to manage customer demand through a distribution channel network. In industrial selling, salespeople mostly handled customer enquiries, gave a demonstration and collect the order. (Many organizations did not have a sales function; they called it commercial department)

2. The Relationship Paradigm: By the end of 20th century, marketing scholars started building the concept of relationship marketing and that had a major impact on the way companies would look at their salespeople. A big change that took place was in terms of the value of a salesperson. Since customer relationships became the key driver for sales growth, salespeople were on the front of relationship building efforts. Again, a technological advancement in term of computing software made the idea of CRM operationally efficient. Now, salespeople were much more informed about their customer and they could customize their selling strategy to be more effective. Salesforce effectiveness became the buzz word.

3. The Value Paradigm: As we entered the 21st century, marketers emphasized that the sustainable relationship with customers is possible only if we understand customer value and deliver it to them. This had huge positive implications for the profession of selling. (a) Salespeople started appreciating the idea of customer value creation and that made them customer oriented. They started following the customers’ benefit schema and designed their sales pitch accordingly. (b) A salesperson was no longer responding to customer requirements, she was actively participating in helping the customer understand and articulate the requirements. The salesperson started doing so with the help of relevant knowledge delivery. (c) The notion of a salesperson as a ‘Value Merchant’ started gathering more strength, as more and more companies treated their salespeople as ‘knowledge brokers’ to get more customer insights that would help them to design market offerings. (d) This brought more prestige, accountability and integrity in a salesperson’s job. (I wish to exclude exceptions to unethical practices by few companies. Salespeople did not fail, sales strategy did!)

With this understanding of the evolution of a salesperson’s profession, I go back to my experience with the salesperson I met at Himalaya opticals. As a salesperson, he was taking full responsibility for the value that I was looking for. With his experience, he could make out that I was looking for something that was comfortable to wear and he must have noted that I was not looking at the MRP. Therefore, he possibly and rightly so took me as someone who could pay a higher price for a better frame. Hence the advice: come back on Friday, we are getting fresh stock. And to ensure that I come back, he said with confidence: “You will get what you are looking for and I will work out the best deal for you”. Am I going back to the store? You bet!

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The Consumption behavior of Politics Consumers: View Through the Marketing Lens

Post Gujrat elections, rims of newsprint, hours of primetime news and thousands of pages of social media are abuzz with multiple views on the winners and losers of the elections. Despite different undertones of the opinions colored by political affiliations, identity inclinations and EVM scare, there exists a common underlying theme; the real winner of the election was the voter, the consumer of the Indian politics. Possibly, the last time that the voters (consumers, here on) swayed on a ‘wave’ was during the elections that followed the end of Indira Gandhi era. Since then, Indian voters have evolved in their approach to voting decisions (read political consumption). Voters are seemingly making a shift from being an automatic thinker to becoming a rational thinker (effortful thinking) while making their choices. If one scans through the results of the recent Gujrat elections, it would be difficult to miss this shift. With so much of noise around the GST by the opposition parties and general anti-GST sentiments among traders, the results of Surat constituencies threw a pleasant/nasty surprise. Through their majority votes, the traders almost approved the reform initiated through GST. Anyone would have guessed that ‘automatic response’ from these voters will be against the BJP, however it turned out to be in favor of the BJP. Clearly, the consumers of political parties (read voters) did some effortful thinking when it came to exercise their choice.
Daniel Kahneman, in his book, Thinking Fast and Slow, describes two systems of thinking; system 1 that operates quickly and automatically without much effort, and system 2 that allocates attention and effort to think through complexities. Possibly, when voters in Gujrat were confronted with the choice of voting for a party, a large majority applied system 2 thinking. Therefore, when they evaluated GST impact, they possibly traded off through the short-term pain and long-term gains; when they considered reservation, religion, identity, corruption and development, their placed more weightage on development and corruption free ideas. Therefore,

Point No.1: Consumers of political parties are moving to system 2 thinking.

This brings us to the core marketing issue; to understand the mechanism that shapes consumer (voter) preferences and choices. My argument here is as follows; as much in marketing of any product or service or a combination of the two, understanding of consumer choices is equally critical in political marketing. The marketing as applied in elections must move beyond managing communication and image of the political parties and leaders. It must take a customer (voter) centric view. A political promise (if we consider that as a product) is a combination of two or several issues that concerns the consumers such as; job reservations, agriculture reforms, economic development, corruption etc. to name a few. Most of the time, communication focusses on one or two such issues whereas the consumers consider multiple issues in different measures and try to figure out the best combination for her choice. This is like a high involvement purchase situation where a consumer may trade off a shorter warranty period for a lower price being offered by a seller, or a consumer may pay a higher price for a machine for a longer service contract, in this case making a trade-off for long-term value. If you ever wondered that why the voters ignore the ‘Hindutva’ label associated with BJP and still vote for it, the answer lies in the trading off mechanism that puts extreme values on development and trust in the leadership. Same goes with demonetization and GST. Consumers trade off the short-term pains with the long term expected gains. Therefore;

Pont No.2: If you want to decode system 2 thinking of the voters, mine into their trade off mechanism and learn to manipulate that.

Clearly, the way forward is to get close to the consumers. Understanding consumer’s choice designs across consumer segments may turn out to be a great enabler. It’s time to think about voting as a high involvement shopping decision and marketers (politicians and their parties) should tune in to their target segments and understand what is not being said. As a Gujrati friend quipped post-election results: Voters are a thinking lot, BJP ko dara diya, congress ko hara diya (They scared the BJP and made congress lose the elections).

Win-Win is certainly an outcome of  system 2 thinking!

Driving SMEs growth through marketing analytics:An illustration

The advent of technology and its application to make industries more efficient and profitable is an integral strategic component of the overall industrial growth plan globally. Technology has helped organizations leverage their strengths and achieve scale and growth. The poultry industry has transformed itself through the infusion of technology that has resulted in new products, processes and more significantly, it’s ability to explore new frontiers of business such as putting eggs and chicken into superfood category. Undoubtedly, the poultry industry is on the cusp of a big change and therefore, the firms need to assess their readiness to embrace new realities that would drive the business. One such reality is that we are ushering in a digital era. The digital revolution is not merely about doing things on a digital platform, it is more about consumption, communication, advocacy and our ability to understand our customers better. Firms have access to more information that is organized, updated and stored for current and future usage. This provides the poultry industry a great opportunity to make a strategic shift; technology in its traditional avatar was more inward-looking and now in its digital form enables firms to have an outside-in approach to business. This approach that essentially puts marketing at the forefront and customers at the core of the business, is about using the information to answer key questions such as:

  • What are the new opportunities to serve our existing customers?
  • How do we reach out to new customer segments?
  • What type of product variants would find more preference in our chosen customer segments?
  • How do we optimize our reach to the customer segments?
  • Which form of communication works best for my customers?

A firm that markets to other firms in the poultry industry(B2B) or a firm that markets to consumers(B2C), the key business imperative is to ask the right question and find answers by deploying data analytics. Insights emerging from such investigations could then serve as a beacon for thinking innovative ways to build cutting-edge marketing capabilities. For example, many hatcheries in Delhi-NCR region has started marketing eggs through an established channel of grocery stores, online as well offline. A careful analysis of product offering would reveal that the variants of eggs are just two ; white and brown. As a marketer, these firms would benefit a lot if they were to consider choice analytics to understand consumer preferences. Consumers might be looking at different benefits which might include low-calorie eggs, low cholesterol eggs or high protein content eggs. Clearly, their willingness to pay different and higher price for their preference would mean more margins for the marketer. The consumers might also be looking at eggs with longer storage life that would increase convenience and minimise wastage. Therefore, this could be a great idea to deploy choice analytics ( Conjoint tools such as choice based conjoint ) and develop understanding on the combination of benefits that different types of consumers are looking for and are willing to pay for the value.

Yes, different types of customers! This is all about looking at the market with a dissection tool that slices the market into few homogeneous groups of consumers which are termed as market segments. Segmenting the market is a base level strategic decision but it is one of the most crucial call a firm needs to take. Therefore, three questions must be asked:

  • What constitutes the market?
  • In what meaningful ways the market can be partitioned into segments?
  • Which segment(s) do we want to target?

In absence of such a strategic direction, a poultry marketer would continue to market similar eggs to all customers(continuing with the same example) and make profits. However, it would certainly miss the bigger picture that contains the seeds of new market opportunities and presents opportunities for maximising value by making segment specific offerings. This also enables the marketer to define his business. In this example, is the firm in the business of eggs, business of food, or, it is in the business of providing superior nutrition. Firms can answer and address such strategic imperatives by examining their markets at a broad level and then can deploy customer analytics to partition the market and define customer segments in a more meaningful and profitable way.

In the context of firms that are engaged in marketing products to other firms in poultry industry(B2B), application of marketing analytics can yield huge dividends. Consider a firm in the business of producing and marketing feed to other poultry firms. Considering the challenges of storing feed is complex and daunting, the best possible scenario would be to minimize the warehousing and inventory cost. Demand forecasting tools such as predictive models based on industry consumption pattern and individual firm’s market share can accrue huge cost savings and better customer service. Such models can guide the firms into building efficient supply chain capabilities and turn in better profits.

Another big opportunity for poultry product marketers is in the form of going ‘direct-to-customer’ model. While most of the firms are reaching out to their consumers through the various distribution channel, a clear opportunity to build a direct network is a possibility considering the fast evolution of delivery companies. Firms can market different poultry products ( processed ones included ) to their customers using technology platforms and leverage these through digital marketing. There are examples galore wherein related products such as Cow’s milk-producing firms are using smart technology to build such milk brands. Therefore, one wonders if a firm can deliver chicken to customers guaranteeing hygiene and great value for money. Expand this idea a little more and one start thinking of creating chicken brands, variants, and exotic poultry meat.

Overall, it’s a great time to be in this business if firms can develop a sharper sense of consumer behavior and understand consumer preferences clearly. Therefore, poultry firms need to build capacity for market insights mining and work on identifying opportunities that can be harnessed through technology and data analytics. A firm’s size does not matter, firm’s intention and ambition to grow bigger does matter a lot. Tune in to marketing analytics to drive growth in your firm and in the poultry industry.

 

 

The Jingle Jangle Fallacy: Perspectives on Business Teaching

“Jinglejangle fallacies refer to the erroneous assumptions that two different things are the same because they bear the same name (jingle fallacy) or that two identical or almost identical things are different because they are labeled differently (jangle fallacy)”.  (Wikipedia)

Often, I have struggled with this fallacy when I read an article or participate in a discussion that deals with the contrast between teaching and research. I do agree about the difference in terms of skill sets needed to pursue one or the other, however, if one looks closely from an outcome point of view, in a strictly academic sense, they mean the same thing; furthering the cause of learning. The faculty whether he/she is teaching or working on a research project, it is about what can be taught to the students which is already available and what new can be added to the extant body of knowledge. Can you sense the jangle fallacy in action here?

Talking about teaching and research, a dominant thought is about making both useful to the industry. You teach what the industry needs, you research what can solve a problem in an organization. No one can disagree with that! However, the way we approach relevance issue needs a relook. In a simplistic way, let us approach this using the knowledge-skill-attitude chain. Seemingly, knowledge is the starting point and therefore transferring of knowledge that exists and the pursuit of creating new knowledge serve the same cause. Clearly, this whole ‘relevance’ debate is making us drift a bit from our purpose and various perspectives are emerging. Some to the extent that it undermines the conceptual grounding that is so important for even seeking the right knowledge. Consider an excerpt from an email that I received this morning: “Students will find this book useful because, while marketing textbooks by Philip Kotler and others introduce students to a plethora of terms and jargons leaving them wondering as to what to do with them, our book helps students develop solutions, perspectives, and convictions………True marketing wisdom can be obtained only under the tutelage of the master practitioner. Sadly, our students do not get this opportunity. The ‘Best Practices’ are substitutes for the best practitioners of the world. As a student goes through each of the ‘Best Practices’, he feels he is under the apprenticeship of the master practitioner. The ‘Best Practices’ are the most precious jewels of the book.” 

A few months ago, Prof. Nirmalya Kumar wrote about bringing practitioners in the classrooms. Indeed, I too have a bias (being an industry person myself) for getting more and more industry insights into my class and students love those sessions. However, if left at that students will receive the knowledge on things that happen in an organization. As a business faculty, we need to go further; as Prof. Kumar suggests, to bring the nuances of causation and boundary conditions of a marketing phenomenon. The complete chain of ‘what-why-how-why not’ is important for the students, not just what happened in that specific industry context. ( In case method of teaching, that’s what we do – specific to the general with boundary conditions!) In my opinion, this is the way forward to build strong industry-academia connect.

Academic research must unravel mysteries that the industry is grappling with. Absolutely! Good research is always about that. A good marketing journal is not prepared to look at your work if it does not advance the body of literature and is found lacking on a promising story for practitioners. Prof. V.Kumar, the editor of Journal of Marketing advocates the idea of marrying academic rigor and industry relevance. This clearly sets the agenda for research which converges on the basic need of business education; to serve the industry. As Prof.Nirmalya Kumar suggests; “The responsibility of faculty is to debunk widely held myths and simplistic causal inferences through research, reflection, analytical rigor, and data. And, this process helps develop a more nuanced and complex understanding of how the world works”. If that was not true then why do we need to develop multiple perspectives on, for example, customer engagement? It’s not an academic debate but a ‘real’ industry dilemma; whether pre-purchase engagement more important than the post-purchase engagement? Does customer extra role behavior accrue benefits for the firm or it has a dark side to it? Listening to a doctoral student’s seminar this week, I was thinking; if this research was going to add to the existing knowledge on customer engagement. I bet, it would and all of us will benefit; the teachers,  researchers, students and my ex-colleagues at The Times Group.

Internship to PPO conversion: Is there a winning formula?

I teach courses on B2B marketing, research methods, marketing analytics, and sales management. Most of the students walk into my office to seek advice on issues related to their course work. Sometimes, they have different questions as well, like the one I faced a week ago; What should I do to convert my internship into a PPO? I did offer some advice to the student and we closed our conversation.

That set me thinking; it was a great question and a very positive attitude! I started putting together some of my thoughts around what makes an intern a potential employee. What are the key markers of such interns that managers keep looking for? There are no straightforward answers, but, seemingly a set of values, skills, and behaviors does enhance the odds to get a PPO. Some of these are discussed below:

1.      Sincerity: Be sincere in everything that you do as an intern. Take your job very seriously as if you are going to make a big contribution. Let that be palpable to people around you.

2.      Punctuality: ‘First in last out’ is a good idea. Be there on time and extend your work hours for meaningful engagements. Do not just hand around.

3.      Enthusiasm: An intern must display excitement for learning opportunities. Complete each task with that spirit of learning and do not settle for anything less than a great output. Exceed expectations; that’s the keyword here.

4.      Stretch: Managers notice interns who are willing to do more, beyond the set assignments. Look for such opportunities to help/assist your mentor in any of his/her projects. Can I be of some assistance; that’s a great attitude to carry.

5.      Ask (intelligent) questions: Learn the basics on your own. Try and get information from published resources including company/customers websites. Ask questions to communicate that you want a deeper understanding. Take time and prepare your questions and do not expect ready answers. Offer your time if some data crunching or research is required to find answers.

6.      Research Skills: If you did your research method course with full involvement ( you understand what I mean), you are carrying few important skills with you. Use these skills to surprise your mentors. Appear resourceful, gather data and generate insights. Help your mentor to do things with data that he/she wanted to.

7.      Be Professional: Build relationships but respect the distance. Remember, the only way you can create value for yourself is by creating and delivering value for your mentor. You are competing with several other interns from different B-Schools; your winning mantra is to deliver superior value!

One more point: before you report for your internship ask this question to yourself; are you willing to craft a strategy to come back with a PPO? If your answer is yes, go ahead and work on your game plan. Those seven points would serve as guiding posts for you.

Best of Luck!Interns

Flat Sales Organization on Your Mind? Consider Self-leadership Training

Leadership for the sales team is considered to be a strong predictor of sales force effectiveness. Measured in terms of objective performance, relationship performance and customer performance, sales force effectiveness is a key indicator for firm’s long-term financial performance. And, for most of the firms, the responsibility rests with the sales managers who are mandated to lead their teams to perform better, year after year. However, as businesses move into greater complexities in an uncertain environment, there are stronger pieces of evidence emerging from various studies to suggest that salespeople who are more empowered to serve their customers are likely to be better performers.

One of the more powerful ways to empower your sales force is to train them with appropriate cognitive strategies. A set of such strategies is called self-leadership strategies or SLS. There are three dimensions through which these strategies provide enough drive and motivation to salespeople so that they achieve the desired sales outcomes. These dimensions are; (a) Thought self-leadership, (b) Behaviour focused strategies, and, (c) natural rewards strategies. These strategies in a standalone form or through an interactive mechanism heighten the sense of self-efficacy (the belief that one can engage with customers with complete knowledge and skills) in salespeople and they become more confident in dealing with complex sales situation with minimal supervision.

In a 2015 paper which was published in Journal of Business and Industrial Marketing, we presented the evidence to suggest that natural rewards strategies were the key driver of customer orientation in salespeople and they could achieve higher levels of performance by deploying selling skills and emotion regulation mechanism effectively. We followed up on our previous work and tested another model in our next paper (forthcoming in the Journal of Business and Industrial Marketing) in 2016. Here’s what we found; thought self-leadership enhanced the self-efficacy perceptions among salespeople and they could perform at higher levels (relative to salespeople with lower thought self-leadership) by effectively using their selling skills and adaptive selling behaviors. Clearly, in both the studies which used sales force as a sample, the relationship between SLS and performance was significantly positive and this linkage was mediated by skills and behaviors deployed during the planning and execution of sales calls.

One big reason that a company should invest in SLS training for its sales force is about enhanced effectiveness. The bigger and more important reason to consider SLS training is to build a sales team which delivers sustainable and purposeful growth in sales numbers, independent of supervisory influences. Another advantage is in the form of reduced supervision cost and therefore, as your sales force moves into a higher plane of self-leadership, you can have a sales organization with lesser layers.

More speed to your sales organization!

Managing the Residual Impact of Marketing

Marketing is about meeting customer needs profitably by engaging in exchange transactions. In a way, marketing can be viewed as a sales outreach by organizations to various members of the consumption community or customer segments and therefore it extends to the larger society. The exchange which occurs through the marketing process impacts the transacting parties primarily but it does leave a significant residual impact on society with  ethical ramifications. This is true for both settings; product or services; with co-creation of customer value at the core of the marketing process. Essentially, every transaction has a broader impact on economic indicators such as GDP and a narrow and focused impact on company’s revenues. However, the very nature of exchange  is social and therefore, as several marketing scholars argue, its outcome must be evaluated in terms of ‘fairness’ and rightness on all parties involved in the marketing exchange. Marketers have been accused of being not sensitive enough towards these measures of ‘fairness’ and or ‘rightness’ for evaluating the impact of marketing on the society. This lack of ‘responsibility’ virtue has been discussed, debated on platforms across the domains and various stakeholders of the business discipline, including the marketing theorists.

Clearly, responsible marketing is all about being sensitive and mindful about ethical consideration in marketing decisions. Recently, the momentum towards creating wider acceptability to this idea found a new push as compelling arguments appeared in leading marketing journals on mindful consumption, public policy implications of marketing decisions. There has been much talk on this and too little action to support the notion that the idea has gained some traction. Very recently, an important development was reported in newspapers. Reading that report, one does get a sense that responsible marketing as an idea is taking a good shape. Read on…

Two years ago, Pepsico CEO Indira Nooyi was visiting India and during her meetings with Indian government officials, a concern was raised over high sugar content in the drinks marketed by Pepsico. Though it took two years to respond to that concern, the strength of response compensates for that. Here’s an excerpt from the ET report that appeared on 18th October.

” PepsiCo will reduce sugar content in its juices and carbonated drinks in India by 2025 as part of a global pledge announced by Chief Executive Indra Nooyi on Monday amid a backlash against such products over an obesity epidemic and illnesses such as diabetes. Several countries are also considering a sugar tax to reduce consumption of sugary drinks.As part of the initiative, the company will introduce smaller sizes and bring zero-calorie drinks to India with close to two-thirds of the company’s beverages having 100 calories or less per 12-ounce serving.“We have started the sugar reduction journey across colas, flavors, and juices. We will be replacing sugar with natural and artificial sweeteners across our portfolio, and will also reduce portion sizes of beverages in bottles and cans,“ PepsiCo India Chairman D Shivakumar told ET. Pepsi began selling colas in 150-ml cans, the smallest in the domestic market, in February. “These are now being extended to other brands such as 7Up, Mountain Dew, Diet Pepsi and Mirinda. This is about portion control,“ Shivakumar said. “For the next 10 years, we will focus on products, planet, and people.“pepsi