1 Overview of hospitality sales.
The sales function is the cornerstone of the hospitality industry. Those employed in hospitality sales are directly responsible for the revenues of their respective organizations. Consequently, hospitality firms allocate more funds to personal selling than to any other promotional tool.
Organizations are willing to make large investments in personal selling because, not only does it result in income for the firm, but sales efforts also increase customer satisfaction. Personal selling is the only promotional form that offers immediate feedback, allowing sales people to adapt continuously so that the needs of each individual customer are addressed. That is, personal selling has the highest level of flexibility of all promotional methods and allows for micro-marketing--marketing to "one."
This introductory chapter first discusses consultative sales, the sales approach advocated. Next, the traits commonly found in good salespeople are identified and the various sales in hospitality are described. Finally, each step of the sales process; which will be elaborated on in this book; is introduced.
Consultative vs. Traditional Selling
In this book, personal selling is defined as person-to-person communication with a prospective customer in order to develop a relationship, identify customer needs, match goods/services with those needs, communicate benefits to customers, and gain commitment to purchase goods/services that satisfy customer needs. This definition advocates a consultative selling approach. Consultative selling focuses on satisfying the needs of the customer; thus, consultative salespeople seek to act as problem-solvers. As shown in the comparative table in Figure 1-1, Consultative Selling vs. Traditional Selling, a consultative sales approach concentrates most of its efforts in the early stages of the sales process: preapproach, approach, and need identification. The emphasis is on information gathering and dissemination. Consequently, the consultative salesperson is able to establish a relationship with the prospect, concentrate on the needs of the prospective customer, and readily handle any objections. In doing so, gaining commitment from the prospect is natural and easy. By contrast, traditional sales approaches focus most heavily on the latter stages of the sales process. As a result, little effort is made to understand the needs of the prospective customer; thus, handling objections is difficult and closing the sale is more complex, artificial, and time-consuming. In essence, all customers are treated as if they have the same needs.
Consultative selling is best used in conjunction with strategic sales planning. (1) The integration of consultative and strategic selling has evolved in response to today's hyper-competitive environment, the increase in the complexity of services/goods, and the growing emphasis on relationship marketing. In using this integrated approach, salespeople first utilize customer mapping to understand the critical roles that are involved in the buying decision process.
[FIGURE 1-1 OMITTED]
The first step is followed by information gathering, the determination of customer needs, the development of solutions as "wins," the provision of reassurances, the close, and finally, the provision of after-sale service. This book emphasizes this blended approach.
As you might suspect, this approach to selling also encourages relationship selling, in which the salesperson seeks the development of a trusting partnership with the customer as a means of providing long-term customer understanding and satisfaction. When utilizing relationship selling, customers benefit by having their needs anticipated and met, while the salesperson gains future sales that are yielded from the relationship over time. Because the cost of obtaining a new customer is much greater than the cost of retaining a current customer, the goal of every salesperson should be to develop long-term relationships with customers.
Characteristics of a Good Salesperson
Good salespeople have a number of common traits, as shown in Figure 1-2, Desirable Salesperson Traits. They are self-motivated, organized, enthusiastic, competitive, goal-oriented, empathetic listeners, and most importantly, adaptive and learning-oriented, and customer-oriented. Adaptive salespeople have the ability to routinely alter the way they communicate, so they match the communication styles of their customers. (2) In turn, these salespeople are more effective communicators, which aids in developing customer rapport and presenting the right information to each customer. Learning-oriented sales people are open to and excited about acquiring new knowledge or skills. (3) Customer-oriented means the salesperson seeks to resolve customer problems in a manner that is in the best interest of the customer, rather than seeking to sell a product or service that may not truly meet the needs of the customer. (4) These latter traits have been identified as the differentiating factors between successful and mediocre salespeople. (5)
[FIGURE 1-2 OMITTED]
Sales Roles in Hospitality
Hospitality organizations may structure their sales departments in diverse fashions. The structures may be determined by many factors, including the size of the organization, the size of the property, the property segment (budget/economy, mid-scale, upscale, luxury), and the property type (such as, convention hotel, resort, casino). Career opportunities in sales are available in nearly all property segments, sizes, and types. However, an increase in the complexity of hotel operations will likely lead to greater complexity in the sales department, with each line function holding different responsibilities. (6)
Directors of marketing are senior-level managers responsible for governing the sales and marketing efforts of the organization. They formulate long-term goals, direct the sales strategy, determine the marketing and sales budgets, and oversee advertising. In some organizations, the directors of marketing at the property level may have responsibilities equivalent to corporate sales managers at other organizations. If the size of their respective organizations warrant it, the directors of marketing may have several department heads that fall under their direct supervision. These department heads may include director of group sales, director of transient sales, and director of catering.
A Director of group sales oversees the group room sales effort of the senior and junior salespeople, and is personally responsible for maintaining and growing key group accounts. A Director of transient sales supervises the reservationists and is accountable for meeting revenue management goals. A Director of catering is responsible for the operational catering staff, as well as the sales efforts of the catering staff.
Underneath these department heads are the positions that in turn report to them: senior sales managers, sales managers, transient sales managers, catering managers, and reservationists. Senior sales managers (or national account managers) are responsible for calling on key accounts and also serve as mentors to inexperienced sales managers. In some cases, senior sales managers may head their entire sales department. Sales managers are the salespeople responsible for group business within assigned market segments. They are often responsible for small-to medium-sized accounts. Transient sales managers are the individuals responsible for working with organizations and associations within the local area in order to generate additional transient business. In some cases the transient sales manager will offer special rates to local corporations that can guarantee a certain number of room nights within a specified time frame. Catering managers sell to groups whose main function is centered around a catered meal. These local groups frequently do not book any rooms or may book only a small number of rooms. Reservationists also function as part of the sales structure of the hospitality firm, but may not be housed within the same department. In recent years, the importance of reservationists has been realized, as they interact with approximately 80 percent of a company's customers. (7) Consequently, reservationists are now receiving better sales training and are being provided with resources and incentives to encourage up-selling and cross-selling. Depending on the size and structure of the hospitality firm, other sales positions beyond the ones noted may be a part of the firm's organizational chart.
While the sales forces of most hospitality firms are still based on-site at the hotel property, some firms are recognizing the importance of being "customer-centric." Some organizations are placing salespeople in locations where their major customers originate rather than where the hospitality firms are located. These salespeople are based from their homes and they spend their workdays in the field calling on the key accounts.
The Sales Process
The following chapters will discuss the eight steps of the sales process: prospecting, preapproach, approach, need identification, presentation, handling objections, gaining commitment, and follow-up. These steps are shown in Figure 1-3, the Sales Process. As previously noted, when utilizing a traditional selling method, the salesperson spends little time on the early stages of the process--especially the approach and need identification. Therefore, the typical prospect may not be properly qualified or is not convinced that he or she needs the product or service; so gaining commitment, or closing the sale, becomes very difficult, tedious, and time-consuming for the salesperson. However, under a consultative approach, much more time is devoted to the early stages of the sales process, specifically prospecting, preapproach, approach, and need identification. As a result, gaining commitment from the prospect becomes a very natural, logical next step. Ideally, the salesperson has defined the customer's needs and has clearly linked them to the benefits offered by the product or service; thus, the customer is readily convinced that the product/service will solve his or her problem or meet a need. Having needs met, whether they be latent (for example, image or status) or manifest (such as, need for meeting space), is the reason behind every purchase made.
In Chapter 1, the following key concepts have been discussed:
* Personal selling offers several advantages: salespersons can adapt their presentations to suit the needs of individual customers, immediate feedback from the customer can be responded to during sales presentations, and the effectiveness of personal selling can be more easily measured. Personal selling also drives the revenues of the organization.
* Personal selling involves direct communication with a prospective customer in order to develop a relationship, identify customer needs, match goods/services with those needs, communicate benefits to customers, and gain commitment to purchase goods/services that satisfy customer needs. The definition is aligned with the consultative sales approach.
* In the traditional selling method, little time is spent on the early stages of the process, so closing a sale is awkward and difficult. In the consultative sales method, a great deal of time is spent in the early stages so that commitment is gained as a very natural, or logical, next step.
[FIGURE 1-3 OMITTED]
* The common characteristics of good salespeople are described. In particular, the traits of adaptive selling, learning orientation, and customer orientation are highlighted.
* The sales process is composed of eight basic steps: prospecting, preapproach and planning, approaching the client, identifying client needs, presenting the product, handling objections, gaining commitment, and following up on and keeping promises.
Following this introductory chapter, each subsequent chapter will focus on a part of the sales process from prospecting through follow-up. In addition, chapters on contracts, servicing the customer, revenue management, and time management are included.
(1) To learn more about strategic sales planning, see Heiman, Stephen E., Diane Sanchez with Tad Tuleja (1998) The New Strategic Selling, New York: Warner Books, Inc.
(2) Spiro, Rosann L. and Barton A. Weitz (1990), "Adaptive Selling: Conceptualization, Measurement and Nomological Validity," Journal of Marketing Research 27 (February), 61-69.
(3) For more on learning orientation, see for example, Colquitt, Jason A. and Marcia J. Simmering (1998), "Conscientiousness, Goal Orientation, and Motivation to Learn During the Learning Process: A Longitudinal Study," Journal of Applied Psychology 83 (August), 654-665; Calantone, Roger J., S. Tamer Cavusgil, and Yushan Zhao, "Learning Orientation, Firm Innovation Capability, and Firm Performance," Industrial Marketing Management 31 (September), 515-524 and Celuch, Kevin G., Chickery J. Kasouf, and Venkatakrishnan Peruvemba (2002), "The Effects of Perceived Market and Learning Orientation on Assessed Organizational Capabilities," Industrial Marketing Management 31 (September), 545-554.
(4) Saxe, Robert and Barton A. Weitz (1982), "The SOCO Scale: A Measure of the Customer Orientation of Salespeople," Journal of Marketing Research 19 (August), 343-351.
(5) Weitz, Barton A., Sujan and Sujan (1986), "Knowledge, Motivation, and Adaptive Behavior: A Framework for Improving Selling Effectiveness," Journal of Marketing 50 (October), 174-191; Grewal, Dhruv and Arun Sharma (1991), "The Effect of Salesforce Behavior on Customer Satisfaction: An Interactive Framework," Journal of Personal Selling & Sales Management 11 (Summer), 13-23; Goolsby, Jerry R., Rosemary R. Lagace, and Michael L. Boorom (1992), "Psychological Adaptiveness and Sales Performance," Journal of Personal Selling & Sales Management 12 (Spring), 51-66; Deshpande, Rohit, John U. Farley, and Frederick E. Webster (1993), "Corporate Culture, Customer Orientation, and Innovativeness in Japanese Firms: A Quadrad Analysis," Journal of Marketing 57 (January), 23-27; Williams, Michael R. and Jill S. Attaway (1996), "Exploring Salespersons' Customer Orientation as a Mediator of Organizational Culture's Influence on Buyer-Seller Relationships," Journal of Personal Selling & Sales Management 16 (Fall), 33-52.
(6) For more information on the various sales office roles, see Ismail, Ahmed (1999), Hotel Sales & Operations, Albany: Delmar Publishers.
(7) Kotler, Philip, John Bowen, and James Makens, (2003), Marketing for Hospitality and Tourism, 3rd ed., Upper Saddle River, NJ: Prentice Hall.
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|Publication:||Hospitality Sales: Selling Smarter|
|Date:||Jan 1, 2004|
|Next Article:||2 Prospecting and preapproach.|