The evolution of selling: a study of historical and contemporary sales methods and attitudes
The evolution of selling had several distinct phases of development during the course of late 19th and 20th centuries. Industrial revolution of late 19th century caused a tremendous amount of exchange of goods between people and nations all over the world. Strategic resources at this time were capital and resources companies controlled. Therefore sales success was defined by meeting sales quotas. This period can be roughly defined from 1860s – 1960s.
However from 1960s a new age in the area of selling has started. It was an Information Age. From 1960s till now information has radically changed how selling is being conducted, methods and attitudes towards selling. In this age, strategic resource of the business is information and it is defined by customer relationships. Adding value is the primary success criteria of the selling process. Of course these are generalised notions of the evolution in selling.
There are exceptions and plenty of businesses who are doing things old school and don’t want to adjust to modern reality. Moreover there are businesses which are following century old techniques and methods used by their founders and finding themselves niches in the market where they are successfully operating. One of them is Avon – direct and door to door seller of women’s cosmetics.
In this part of the essay professional selling which gained momentum during the industrial revolution and kept serving business well until post-WWII times will be discussed in detail. Major advances in manufacturing and transportation made possessing resources and capital a major aim for business.
This naturally required skilled people with talents in persuading and providing goods to a broad range of customers. As selling and exchange goods at this scale were unknown to humankind up until this point, buyers were relatively unsophisticated and could have been easily manipulated towards making a purchase by a talented sales person. That is why until 1960 main technique of sales people was persuasion. Therefore short term seller needs obviously became a priority for sales people and business. Goal was no matter what the customer wanted is to close the deal and meet sales quotas.
One of the main and oldest paradigms in the discipline of selling history at those times was Seven Steps Selling (Moncrief et al.2005). This is quite simple in its description but very powerful method when used by skilled sales force. As its name suggests it consists of 7 steps and describes a typical sales scenario: 1) prospecting – searching for new and potential customers 2) preapproach – researching the prospect and collecting relevant information before the actual sales call 3) approach – first few minutes of the sales call. Making an impression 4) presentation – demonstrating a product, listing features and benefits 5) overcoming objections – countering customer objections and removing the sense of hesitancy of the customer 6) close – successful completion of a sales call. 7) follow up – saying thank you and making sure that customer is happy.
It is stressed by Church (2008) that seven steps was the backbone of selling during industrial age and served it well. The power of this paradigm was its simplicity and clarity of the sales scenario it presented. First time in history sales people could tackle the process systematically and step by step, which ensured predictable and systematic results for sales department of the business. However, time and developments in information technologies transformed and changed 7 steps of selling. Transformation has touched every aspect of selling discipline and customers perceptions about selling.
At 1950s Dale Carnegie by combining theories from two fields of psychology and process methodology came up with AIDCA methodology. It consists of five steps: 1) Attention—through creating ‘sizzle’ 2) Interest—aroused through features and benefits 3) Desire– by linking the product to needs and wants 4) Conviction– from the seller in overcoming objections 5) Action—by actively and assertively closing for commitment to purchase (Tony Hughes, 2011). This method works best in retail, commodities and direct selling i.e. less complex environment. However, more complex selling and strategy can’t be addressed by this methodology.
One of the main features of selling during this period was that emphasis was on individual effort from the sales person. A lot depended on his/her abilities, wit and entrepreneurial abilities in pushing sales and earning commissions. Being a salesman was compared to being an artist and something innate and a person was born with. Charisma and outgoing character were valued most.
Competition was the force which changed sales and selling methodologies forever. Because of the stiff competition in the market, businesses had to become more sophisticated in their approach to sales and differentiate from ever increasing competitors. This sophistication and differentiation developed in different ways, but the main ones were emphasizing information in dealing with customers, developing relationships with them and adding value to customers businesses. These kinds of developments started a new era in selling discipline, which was an information era.
Information era became a reality with extraordinary developments in technology. Technologies such as fax, internet and mobile telephones had an immense effect on the development and transformation of selling discipline for decades to come. Together with other methodologies and paradigms, seven steps of selling have transformed as well. Moncrief et al in 2001 revised original seven steps of selling and examined the changes which occurred to this classic paradigm of selling. As a result importance of some steps increased and some steps in the paradigm became less important or even irrelevant. Prospecting became teamwork and often outsourced to telemarketers. Teamwork is now more important than individual effort in pre-approach stage. Well executed CRM makes preapproach easier and more effective.
Approach is more of a relationship building and solution finding process after the transformation. Simple, close as much sales as possible rule is not used widely and became less useful. In presentation stage sales person does more listening than talking in order to identify prospective customer’s needs and tries to find relevant solutions. More use of PowerPoint presentations and laptops are made.
Overcoming objection transformed to listening and asking right questions, so sales person can identify what exactly the client want from the product or service. Dlabay et al (2011) confirm this viewpoint and state that ultimate goal is to find the right solution by providing right product or service to the customer, not just classic closing of a sale. Close step of the paradigm became more of an identifying mutual goals and achieving them in the long term. Customers with high ROI are valued and are paid more attention to. Follow up stage became more effective and quick with the wide use of emails. Sales person can send an email and ask whether a customer is happy in a very quick and efficient way.
As a result of these developments seven steps selling became more customer oriented compared to original paradigm and serves businesses in a much economically efficient and productive way. However other paradigms and methodologies in selling appeared after 1960s. These were more customized to certain types of industries and were found to be more relevant by some companies.
Companies such as Avon are still using same old ways of selling as their founders in the end of 19th century did and finding themselves to be quite successful. So selling in a way should be adapted to the industry type of product being sold. Some companies should change all the time, whereas others such as Avon can operate efficiently with a very little adjustment to their selling methods and attitudes.
During the wave of innovations at 70s, FAB – (Features-Functions, Advantages and Benefits) was introduced. This method mainly concentrated on delivering value. Although the method was quite successful in delivering the message of ‘value’, it couldn’t really connect sales people and real decision makers (business leaders, economic buyers). Problem was that sales people struggled to translate and deliver the benefits of the products they are selling to real tangible business value. (Tony Hughes, 2011)
These years marked a substantial increase in the level of sophistication of buyers and procurement officers in corporations. They were quite informed about supplier’s offers and their competitors. This made sales people job even more challenging and demanding. In turn sales departments turned to Neuro-Linguistic Programming (NLP) in training their staff. Anthony Robbins was the person who applied this technique to sales and popularized it in sales. Establishing subconscious trust between customer and influencing them was behind the NLP. (Tony Hughes, 2011)
One of the most prominent researchers in the field of sales Neil Rackham introduced SPIN Selling. This lay the foundations for modern value-based approach to professional sales. Main idea behind this method is that it is more important to understand the buyer’s need than to persuade him/her into buying your product. SPIN stands for situation, problem, implication, need-payoff.
These are the types of questions sales person should be asking a prospective buyer in order to understand his need and offer something from his products to satisfy it. This revolutionary idea was very influential in sales discipline when it was introduced and had a tremendous effect to its future development. However, even SPIN selling didn’t capture some aspects of buyers behaviour and addressed only needs. Whereas, wants and values are much more important in selling. Thorough knowledge of someone’s values might help to design a selling strategy specifically to that buyer. Hence, leading to a successful sale and long term relationship with a customer.
Value selling is specified by Lambin (2008) as the next step from all previous selling methods and it concerns mainly on delivering mutual value to the customer. Having genuine interest in the customer, thoroughly inquiring their needs and problems, agreement on specific needs and benefits and finally coming into terms on the path forward are the main principles of this method. Delivering tangible return on investment by finding and engineering solutions is the priority in value selling. Only by this way it is believed true benefit can be delivered to the customer.
It is considered to be more ethical compared to previous methods and techniques as well. Because it emphasizes the customer, prioritises solution finding and removes persuasion from the equation completely. According to Goldstein and Guembel (2008)
the use of modern technologies and communication technologies is quite widespread in modern selling. Technology and communications facilitates and helps to deliver a value in a more precise and useful way. CRM systems, Business-to-Customer (B2C) and Business-to-Business (B2B) communications, VoIP (Voice Over Internet Protocol) are the main tools in executing sales operations in high a level required by customers at the information age.
As a conclusion it can be said that selling as profession and a discipline went through a lot of changes during its lifetime. Beginning from Industrial Revolution’s simple, unsophisticated and seller oriented methods to modern time’s value added selling, its priorities and environment changed a lot. But one thing remained constant, sales person’s ability and need for sales people to close sales, find relevant solutions and adding value to customer business activities.
Technology and communications did change the field, new techniques and paradigms were invented. However, without actual sales person all these things are tools and no more than that. With ever more informed and educated customers sales is becoming even more challenging and vital in business operations. Team work and background operations empowered the selling instead of diminishing its role in the organisation. Sales again became important and relevant at this age of information as it was in more recent industrial revolution period.
- Copeland, A & Hall, G. (2011) “The response of prices, sales and output to temporary changes in demand” Journal of Applied Econometrics, (26) Issue 2, pp. 232 – 269
- Church, R. (2008) “ Salesman and the transformation of selling in Britain and the US in the nineteenth and early twentieth centuries” The Economic History Review, (61) Issue 3, pp.695 – 725
- Dlabay, L, Burrow, JL & Kleindl, B, 2011, Principles of Business, Cengage Learning
- From “Little Dot” to Dot-Coms: the Evolution of Direct Selling at Avon, Available at: http://www.avoncompany.com
- Goldstein, I & Guembel, A. (2008) “Manipulation and the Allocational Role of Prices” Review of Economic Studies, (75), Issue 1, pp.133 – 164
- Hughes, T. (2011) “The Evolution of Personal Selling” Available at: http://www.crmworks.asia
- Lambin, J.J. (2008) “Changing Market Relationships in the Internet Age” Presses Universitaires de Louvain
- Manning, G, L & Reece, B.L. (2003) “Selling Today: Creating Customer Value” Prentice Hall
- Moncrief, W.C & Marshall, G.W. (2005) “The evolution of the seven steps of selling” Industrial Marketing Management (34), 13-22
- Rackham, N. (1988) “SPIN Selling” McGraw-Hill
- Rackham, N & DeVincentis, J. (1999) “Rethinking the Sales Force: Redefining Selling to Create and Capture Customer Value” McGraw-Hill
- The sales evolution (2011), Available at: http://www.allbusiness.com