Transaction-Focused Traditional vs Trust-Based Relationship Selling - Term Paper Example

?Discuss transaction-focused traditional selling and trust-based relationship selling.  Transaction-focused traditional selling is considered to be inefficient because of the process of the closing sales (Johnston and Marshall, 2005). In the traditional selling, a process is followed from next step to last step which is closing the sales which the sellers are using for their benefits. The focus is usually as to how to get the sale rather than serving the customer (Johnston and Marshall, 2005). For this, the sales person require basic selling skills which include searching for prospective customers and briefing them about the benefits and advantages of the product or service rather in order to increase the sale orders volume (Ingram et al. 2004). The sales person requires information about the product, its competitors, and account gaining strategies to successfully close a sale (Johnston and Marshall, 2005). This technique although out-dated is till used in many industries such as automobiles where the focus of the sale is short-run (Johnston and Marshall, 2005). Trust based relationship selling is considered more personal selling in contrast to transaction-focused selling. Relationship selling is now-a-days the core of selling strategies. Trust-based relationship selling is based on the gaining the trust of the customers by focusing the sales strategy on the communication, creation and delivery of the customer needs and values (Ingram et al, 2004). In this approach to selling, the solving the problems of the customer is the top most priority followed by providing them opportunities and adding value to the business provided by the customers in the future (Ingram et al, 2004). While using the trust-based selling approach, it is important to have knowledge about the product, competitors, the need of the customers, their level of current knowledge, trust-building strategies and so on to successfully bring the customer in the business (Ingram et al. 2004). Another difference between two selling approaches is that after-sales follow up. In transaction-focused selling, there is little or no after-sale follow up because the main aim of the sales person is to gain new business instead of investing in time to ensure the retention and satisfaction of the existing customers (Ingram et al, 2004). This makes this approach to selling, short-sighted resulting in defection and dissatisfaction of the customers. This is also referred to as the maximizing the sales in the short run (Johnston and Marshall, 2005). In contrast to this, trust-based relationship selling follows continuous follow-up to keep the customer well-informed about the added values of the product which ensures high level of satisfaction and gives rise to many other opportunities (Ingram et al, 2004). As many scholars and practitioners regard transaction-based traditional selling inefficient in today’s selling environment, trust-based relationship selling is more preferred by many industries today because of high cost of customer switching to other similar products (Ingram et al, 2004). Instead of experiencing costs of losing customers, businesses invest in retaining those customers which can also lead to prospective customer base (Johnston and Marshall, 2005). In addition to this, this approach gives the business the competitive advantage of building long-term relationships with the customers. If you pay a sales person enough money you will have a well-motivated sales person. Do you agree? Explain your reason.  The management of sales and most importantly sales person is a great task as it controls and at the same motivates sales person to work (David, 2008). Since sales person are not directly controlled, they require more motivation to perform their selling tasks. In addition, interaction levels also vary between sales person and sales managers depending on the positions which causes more difficulty in motivating them (Rosen, 2008). As a result, money could be one of the best motivational tools for the sales person. If sales person are asked that what motivates them, they would usually give the following answers (Rosen, 2008): Money Linking efforts to tangible outcomes Easy switching to higher paying jobs Considering that money motivates a sales person, organizations implement various money-incentive plans for motivation. On the other hand, money is not always considered the only motivational factor behind well-motivated sales person as sometimes it has been seen to decline their motivational level (David, 2008). The argument here is that if paying a certain amount was enough sales people would be seen working 24/7 and keep earning commissions every hour. But that is not the case. At some point, money is considered not to be a big motivator. This is because of the career advancement that an average sales person looks forward to after they have made a decent base for themselves and are satisfying their basic needs (Rosen, 2008). According to a study by Objective Management Group, 450,000 sales person were assessed who showed that higher percentage of sales people considered money to be a de-motivational factor because although money was important to them, they would like to be recognized and appreciated in other ways also (David, 2008). It was also studied by Rosen (2008) that if sales person are paid enough, they forget that how to build good customer relations and create loyal customers for the company. Another downside to paying the sales person enough is given by Rosen (2008) that when money is used is the only motivational tool by the companies, it increases risk of leverage because competitors can entice the company’s best sales person through money to work for them as a result of which a customer base can also be lost. It is commonly known that sales person can calculate their commission faster and accurately than any calculator. Although there is no denying that money is source of well-motivated people, sense of achievement is also a key driver for well-motivated sales (David, 2008). Money would be beneficial when sales person are able to achieve sales or make bigger deals. If they do not have the proper training or guidance or motivation from the management how can they achieve their targets let alone commissions or other monetary benefits (Rosen, 2008). They require sales management practice and training to motivate them to get sales and achieve their monetary incentives. Therefore, according to my opinion, I think if you pay the sales person enough money, you cannot have a well-motivated sales person. REFERENCES David, J. Selling and Sales Management. Pearson Education, India, 2008 Ingram, T., Avila, R., Schwepker, C. and Williams, M. 2nd ed., Professional Selling: A Trust-Based Approach, Cincinnati: Thomson/ Southwestern. 2004 Johnston, W., and Marshall, G. Relationship Selling and Sales Management, Boston: McGraw-Hill/Irwin. 2004 Rosen, K. Coaching Salespeople into Sales Champions: A Tactical Playbook for Managers and Executives. John Wiley and Sons. 2008. Read More

 

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