Despite acquiring a knack for closing the deals, an effective marketing strategy along with a well-crafted website, not able to maximize your profit?
These are necessary for the organization but not enough to maximize your revenue. Before you jump into all this, let us learn- what is Sales management? What is the importance of sales management? What are the different sales management strategies?
Sales are the backbone of a business, and an organization should focus on sales management and representatives to maximize profit. An efficient sales team promises to streamline the internal team for carrying on the other marketing and sales activities.
With good sales management, two factors are affected by an organization. First, it brings more revenue by maximizing the number of closed deals, and second, it helps to streamline the sales team in terms of achieving targets, setting pipelines, making timely follow-ups, etc.
What is Sales Management?
Sales management is defined as “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” by the definition committee of the American marketing association sales management.
But, these days, the definition of sales management has been changed. Sales management is not only limited to tracking the business and supporting the team, but it also covers a vast part of the business. It includes introducing the new product, effective marketing strategy of the existing product, new pitch training to the sales team, analyzing reports on the conversion rate, etc.
This vast portion is divided into three parts:
- Sales Operations
- Sales Strategy
- Sales Analysis
Sales Operations – Building and Managing Teams
Every organization hires sales reps, builds a team, motivates the team to plan the process- this is all under the Sales Process. An efficient sales manager always keeps an eye on every small factor in the organization.
They try to identify the leaky bucket through the micro-management system and fix it. They motivate them to work efficiently to be the result-driven resource of the organization. There are three key factors a sales manager need to follow:
- Set Targets
- Assign Territories
- Establish Goals and Quotas
The first step for a sales manager is to figure out the real challenges and derive a realistic target for the team as per the sales strategy.
To achieve this target, start with identifying the quality of each team member and assign the relevant responsibility for more productivity. In most cases, we encounter random assignments shared with the team failing. Hence, identifying the ability and giving the task is more efficient than a random assignment.
The last phase of the sales operation process is to set the goals and quotas for each sales team member. A sales manager should be transparent while communicating with the team members regarding the goals and quotas.
Sales Strategy – Defining the Sales Process
Move to the sales process after building a successful sales team. In this stage, the further steps include:
- Plan sales process
- Design the sales strategy
- Forecast the closed deals
Once a manager is set with his team, the next step is to plan the sales process to help him maximize the result. Start with getting leads and then segment them into different categories.
For example, there are many leads they received from the marketing team, and they want to utilize each lead properly. In order to do so, they will categorize the leads such as qualified leads, unqualified leads, leads who have issues with the price, etc. Based on the different categories, they should plan how to nurture them and distribute each lead to their team members’ relevant skillset.
After assigning the leads to the team members, designing the sales strategy comes into the picture. Each team member should have daily, weekly, monthly, and quarterly targets. Setting realistic targets and transparently conveying them will motivate the team members to work efficiently.
In this stage, monitoring the performance of each sales rep is essential. It will provide the track of your revenue generation process and offer the opportunity to identify the issues and fix them for better performance.
While managing the team member’s performance to achieve the targets, forecasting the closed deal will provide you with a better idea of closing the deal for the current week, month, and quarter. If the present closed deal is a way behind the forecasted closed arrangement, this is the time to identify the leaky bucket and fix it or implement the new strategy.
Sales Analysis (Analysing the reports)
The last but not least part is to analyze the sales effort. It is an essential component of sales management. Once all the strategies and ideas are implemented, the respective managers are accountable for knowing the effectiveness of their plans.
Analyzing and creating an accurate sales report and sharing it with the top management will create an opportunity to set a realistic target and figure out the bottlenecks.
Why is sales management important?
The points mentioned above provide an overall idea of sales management. It is also significant to know why sales management is an integral part of an organization. Here are the benefits of having sales management:
- Improves revenue generation rate
- Product development
- Sales maximization
- Realistic target set
- Building a strong relationship
- Opportunity to know market demand
- Optimizes distribution
- Better Ideas every time
Improves revenue generation rate
In every organization, maximizing the revenue generation rate becomes the prime focus. An efficient sales management system helps monitor the closed deal and regularly implements different strategies to increase the revenue generation rate.
The sales reps are always in direct touch with the customers, where they will be able to get constant feedback from the customers/clients. A sound sales management system monitors each input which helps to know the expectation level of clients/customers and improve the product accordingly.
Sales maximization happens because of an efficient sales management system. It enables top management to forecast the sales and set a realistic target, which should be more significant than last year. It also manages the micro things at the agent level to fix the bottlenecks and maximize sales.
Realistic target set
Market research is also a significant part of sales management. Creating a report on sales forecasting based on market research and the average pipeline every individual has helps set a realistic target. The realistic target also motivates sales reps to work efficiently.
Building a strong relationship
In every sales organization, the initial motive is to build a strong relationship with customers to maximize the conversion. Building a solid relationship provides instant sales and opens the gate for further prospecting. Sometimes, the trust level of the customers makes them return to you for the following product/service.
Opportunity to know market demand
Collecting feedback and market research are essential parts of the sales management system. You can forecast the requirement of the market through both reports. It helps improve the product or launch a new feature o meet the market demand.
It opens a gate for the maximum utilization of marketing channels. In this way, you will know the efficient channel to promote your product and sell it. As marketing is also a part of the sales management system, it will help you analyze the medium.
Better Ideas every time
With a good strategy, if an organization has a result less than the forecasted result, that is the time to implement better ideas/strategies. Every time it provides the opportunity to experiment with the new strategies to see a better result.
Sales Management Strategies
Sales strategies come first in the sales process and then sales management. In order to start your sales management system, you need to strategize proper plans step by step. Every organization differs from others when it comes to sales management strategies. Here are a few common strategies all organizations adopt:
- Hiring the right talents
- Train the new members based on the sales requirement
- Align your priorities with your team members
- Segment your leads
- Distribute the leads to the relevant talent
- Identify the bottlenecks
- Concentrate on the team activities
- Find the team flaws and fix it
- Motivate your team members
- Open to customer feedback
- Utilize the technology for better productivity
- Reward your team members on their achievements
Objectives of Sales Management
Every organization has a specific objective. It may be short-term or long-term. To achieve the goals, most organizations emphasize sales management. The common goals of sales management are to:
- Increase the revenue generation rate
- Continuous profit
- Organization growth
- Market leadership
Increase the Revenue Generation Rate
As sales teams are solely responsible for generating revenue, the principal motto of a sales management system is to increase the revenue generation rate.
No organization wants to run its business at a loss. Though your organization has excellent profit this time, it should continue getting profit every quarter. Therefore, your sales management system should focus on continuous profit.
Everyone’s growth depends on the organization’s growth. If it grows, each department will grow, resulting in a good profit at the day end. It is a prime objective of sales management systems.
When an organization successfully gets more profit and provides customer satisfaction, sales management enables it to lead the market. Hence this is also another objective of sales management.
Sales management helps an organization in multiple areas ranging from marketing strategy hiring talents to training the sales reps to sell effectively. Though all aspects are not the responsibility of a single manager, a good sales manager should have a fair knowledge of current happenings in other departments. Being aware of all the interrelated sales areas will provide a better idea of driving the team and managing the sales process.