an empirical investigation of critical success factors in the personal selling process for...

An Empirical Investigation of Critical Success Factors in the Personal Selling Process for Homogenous Goods.

Source: Journal of Personal Selling & Sales Management: Summer, 2000 issue

Author(s): Dwyer, Sean; Hill, John; Martin, Warren

Related Topics: Sales management (Planning)Selling (Methods)Salespeople (Methods)

Product Ref.: Sales Force Training & Management

Introduction

In today's highly competitive markets where competitors offer products that are

largely homogenous, the effectiveness of the salesperson during customer

interactions is critical to success. More specifically, particular communication

approaches employed by salespeople have been posited to exert direct influence on

performance (Harris and Spiro 1981; Szymanaki 1988).

One aspect of salespersons' communications involves the behaviors and tactics used

in the sales presentation itself. These selling techniques, while employed to varying

extents by all salespeople, have not been directly examined. Given the critical nature

of communication in personal selling, it seems logical that particular selling

techniques salespeople employ may be associated with sales success (i.e.,

consistently high performance) (Peterson, Cannito, and Brown 1995; Predmore and

Bonnice 1994; Spiro and Perreault 1979). Although a number of studies have

examined salespeople's use of selling techniques, no study has attempted to

determine their association with selling success (cf. Dubinsky 1980; Dubinsky and

Rudelius 1980; Hite and Bellizzi 1985). The study reported here examines selling

techniques relative to sales performance of salespeople involved in selling a

homogenous product.

The Critical Success Factor Approach

Critical success factors are skills, tasks, or behaviors that influence performance

(Bisp, Sorensen, and Grunert 1998; Boynton and Zmud 1984; Leidecker and Bruno

1984; Williams and Ramaprasad 1996). Bullen and Rockart (1981) observe that

performing critical success factors (hereafter, CSFs) satisfactorily ensures successful

competitive performance. Williams and Ramaprasad (1996) note that there are about

six or seven CSFs in any particular context. In addition, CSFs are measurable,

actionable, market-specific, and linked to perceived value in the marketplace (Bisp,

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Sorensen, and Grunert 1998; Boynton and Zmud 1984; Leidecker and Bruno 1984;

Williams and Ramaprasad 1996).

It has been suggested that the association between potential CSFs and performance

measures be assessed (Day and Wensley 1988). This assessment may entail

correlating CSFs with relevant measures of success or, alternatively, comparing CSFs

across winning versus losing competitors (Day and Wensley 1988; Keck, Leigh, and

Lollar 1995).

A considerable stream of research has focused on CSFs at the industry and

organizational levels (e.g., Belassi and Tukel 1996; Boynton and Zmud 1984; Day and

Wensley 1988; Yang 1998). However, the CSF approach has also been applied at the

individual level (Magal, Carr, and Watson 1988; Williams and Ramaprasad 1996).

Keck, Leigh, and Lollar (1995) utilized the CFS approach with salespeople in an

insurance sales setting. A small sample of successful insurance agents identified 35

general success items associated with successful agency practices. A subsequent

survey of a larger sample of the sales force revealed eight CSFs that distinguished

high performing agents from lower performers. A CSF approach is used in the current

study to explore what selling techniques are more critical to sales success for

salespeople who sell homogenous products.

Stages of the Personal Selling Process

The personal selling process is the sequence of steps or stages through which

salespersons proceed in making a sale (Dubinsky 1980; Hite and Bellizzi 1985). The

process can be applied across many selling scenarios, particularly for homogenous

products or services. Seven steps are generally recognized as comprising the

personal selling process (Dubinsky 1980; Hite and Bellizzi 1985; Ingram 1990). Table

1 summarizes the stages.

Table 1 The Personal Selling Process(*)

1. Prospecting: Salespeople use multiple sources to identify

prospective buyers for their products and services. A potential

buyer is considered a prospect when qualified in terms of (a)

need or want, (b) ability to buy, (c) authority to buy, and (d)

eligibility.

2. Pre-approach: Information is gathered about the prospect in

preparation for the sales call. This information is used to both

further qualify the prospect and to develop an effective approach

and presentation to the customer. This stage typically

culminates in setting an appointment with the prospect.

3. Approach: This step covers the first few minutes of the sales

call--a critical time for salespeople. The salesperson's objective

is to make a favorable first impression and to gain the customer's

attention and interest sufficiently to make the presentation.

4. Sales Presentation: This is the "core" of the sales process

where salespeople present their offerings' features and benefits to

potential customers. Attempts are made to arouse customer's desire

for the product.

5. Handling Objections and Overcoming Resistance: Salespeople

attempt to overcome the prospect's resistance and reluctance

to purchase by responding to objections and emphasizing particular

product benefits to promote purchase decisions.

6. Closing. Salespeople initiate purchase decisions through methods

designed to solicit orders. In the most appropriate and

effective manner, customers are asked to purchase the offering.

7. Post-Sale Follow-up: Salespeople continue to emphasize customer

satisfaction in the post-sale period. Activities during this

time include reducing post-purchase concerns of customers; ensuring

timely delivery, installation, and/or training; providing

periodic follow-up or maintenance service; and handling complaints

and questions. In general, the goal is to build goodwill to

enhance future sales chances.

(*) Based on Dubinsky and Rudelius (1980) and Hite and Bellizzi (1985)

For each of these seven steps, there are numerous sales techniques, methods, and

approaches that salespersons can use to enhance customer communications and

relations. The techniques can be used individually or in combination with each other

at the discretion of the salesperson.

Dubinsky (1980) made a significant contribution to sales process research by

compiling a taxonomy of 84 selling techniques that salespersons employ in the field.

The techniques are regarded as being representative of the repertoire of techniques

salespeople use in the personal selling process (Dubinsky and Rudelius 1980; Hite

and Bellizzi 1985). Dubinsky's study suggested that personal selling was indeed a

systematic process. A number of additional studies examine the taxonomy,

advancing knowledge of the personal selling process by exploring areas such as

reducing commonly occurring frustrating sales situations (Dubinsky and Lippitt

1980); the efficacy of sales training programs (Dubinsky and Staples 1981); and the

use of different selling techniques in service versus product settings (Dubinsky and

Rudelius 1980) and consumer versus industrial sales contexts (Hite and Bellizzi

1985).

Selling Techniques as Critical Success Factors

It has been suggested that some selling techniques may generate better sales results

than others (Dubinsky 1980; Dubinsky and Rudelius 1980; Hite and Bellizzi 1985).

While considerable empirical research has focused on explaining salesperson

performance, in general only relatively weak associations have been found between

the determinants of performance and measures of performance (Churchill et al.

1985; Ford et al. 1988). The need to explore antecedents of performance thus

continues (Swenson and Herche 1994). It is in this light that this study explores

whether the use of one or more selling techniques has the potential to be a critical

factor in the success or failure of salespeople who sell homogenous goods. A critical

success factor approach was used to explore whether selling techniques contribute to

the success or failure of life insurance salespersons (Bisp, Sorensen, and Grunert

1998; Boynton and Zmud 1984; Keck, Leigh, and Lollar 1995; Leidecker and Bruno

1984; Williams and Ramaprasad 1996).

CSFs are useful to the study of sales success for several reasons. First, selling

techniques are pervasive to sales scenarios where homogenous goods are sold.

Second, CSFs offer a means to examine selling techniques across scenarios. Third,

CSFs can be used to develop tactical recommendations for salespeople, sales

managers, or sales trainers.

Study Methodology

Sample and Data Collection

The sampling frame for the study was the life insurance industry. Life insurance is a

homogenous product marketed by a large number of professional sales forces. A

considerable number of studies have used samples drawn from the life insurance

industry (e.g., Crosby, Evans, and Cowles 1990; Hoffman, Howe, and Hardigree 1991;

Keck, Leigh, and Lollar 1995; Landau and Werbel 1995; MacKenzie, Podsakoff, and

Fetter 1993). Evidence suggests that there is considerable variation in the

performance of life insurance salespeople (Macintosh et al. 1992; Szymanski and

Churchill 1990).

Data were collected from the agency sales force of a large domestic insurance firm.

The firm agreed to provide a sample of 350 life insurance salespeople. This type of

research sponsorship has been recommended for sales force research by Richardson,

Swan, and McInnis-Bowers (1994).

Questionnaires were mailed from the firm's national headquarters to sales agents in

27 agency offices located throughout the US. A cover letter with a request from the

firm's CEO to fully cooperate with the study was attached to each participant's

survey. The agents were instructed to complete and return the surveys to their

managers in sealed envelopes to ensure anonymity and candid responses. The

managers collected the envelopes and mailed them directly to the researchers for

data entry and analysis.

CSFs are useful to the study of sales success for several reasons. First, selling

techniques are pervasive to sales scenarios where homogenous goods are sold.

Second, CSFs offer a means to examine selling techniques across scenarios. Third,

CSFs can be used to develop tactical recommendations for salespeople, sales

managers, or sales trainers.

Study Methodology

Sample and Data Collection

The sampling frame for the study was the life insurance industry. Life insurance is a

homogenous product marketed by a large number of professional sales forces. A

considerable number of studies have used samples drawn from the life insurance

industry (e.g., Crosby, Evans, and Cowles 1990; Hoffman, Howe, and Hardigree 1991;

Keck, Leigh, and Lollar 1995; Landau and Werbel 1995; MacKenzie, Podsakoff, and

Fetter 1993). Evidence suggests that there is considerable variation in the

performance of life insurance salespeople (Macintosh et al. 1992; Szymanski and

Churchill 1990).

Data were collected from the agency sales force of a large domestic insurance firm.

The firm agreed to provide a sample of 350 life insurance salespeople. This type of

research sponsorship has been recommended for sales force research by Richardson,

Swan, and McInnis-Bowers (1994).

Questionnaires were mailed from the firm's national headquarters to sales agents in 27 agency offices located throughout the US. A cover letter with a request from the firm's CEO to fully cooperate with the study was attached to each participant's survey. The agents were instructed to complete and return the surveys to their managers in sealed envelopes to ensure anonymity and candid responses. The

managers collected the envelopes and mailed them directly to the researchers for data entry and analysis

A total of 324 surveys were received. Of the 324 surveys, 309 were fully completed

and useable for purposes of the study, representing 88% of the 350 surveys originally

requested from the participating firm.

Respondents were predominantly male (89 percent), married (80 percent), and

college educated (80 percent had over sixteen years of formal education). Average

tenure with the firm was nine years, and average experience with insurance sales

was ten years. Ninety-three percent of respondents depended on commission for at

least half of their earnings.

Selling Technique and Performance Measures

The typology of selling techniques used in this study was developed by Dubinsky

(1980). His listing of 84 sales techniques has been used in prior studies (e.g.,

Dubinsky 1980; Dubinsky and Lippitt 1980; Dubinsky and Rudelius 1980; Hite and

Bellizzi 1985) and is generally recognized as the most comprehensive typology of

personal selling techniques (Hite and Bellizzi 1985).

Some modifications to Dubinsky's typology were made in this study to exclude

techniques that were not applicable to insurance sales and to add several new items

reflecting recent trends in selling. In addition, some techniques were consolidated

into broader-based, higher-order measures based on Dubinsky's (1980) factor

analysis of the original 84 selling techniques. Appendix 1 summarizes the 51 selling

techniques used in this study.

Salespersons were asked to indicate how important each selling technique was to

their individual success in selling in the life insurance industry. A seven-point, Likert-

like scale assessing the importance of these selling techniques was used (with "1"

indicating "Not At All Important" and "7" indicating "Very Important").

Respondent-generated performance measures have been used in sales research

(e.g., Behrman and Perreault 1982) and were used in this study. Churchill et al.

(1985) indicate that claims of upward bias in self-reports of performance were ill-

founded. The performance measure used in this study was a summated scale

comprised of the average of five direct, outcome-related items as reported by the

insurance agent: sales commissions earned; exceeding sales objectives and targets;

generating new-customer sales; generating current-customer sales; and overall

selling performance. A seven-point, Likert-like scale was used to assess salesperson

relative performance within the sales organization (with "1" indicating "Far Below

Average" and "7" indicating "Far Above Average"). A coefficient alpha of 0.81 was

obtained for this construct.

Data Analysis

To evaluate the influence of CSFs, the sample was divided into top and bottom

deciles. Such dichotomization was used for several reasons. First, the method allows

examination of techniques used by "expert" salespeople as suggested by Weitz,

Sujan, and Sujan (1986). Secondly, the method allows the determination of what

CSFs differentiate performance-based winners from losers (Day and Wensley 1988;

Keck, Leigh, and Lollar 1995). Table 2 presents the means and standard deviations

for the selling technique variables for high and low-performing salespersons.

Table 2 Means, Standard Deviations, and Logistic Regression Results

Low

Performers

n = 39

Std.

Selling Technique Mean Dev.

Prospecting

Personal observation/research 6.23 1.04

"Cold call" in person ("canvass") 3.18 1.39

"Cold call" by mail 3.62 1.76

"Cold call" by telephone 3.51 1.73

Use "cold call" specialists 3.13 1.99

Prospect Inquiries 4.10 1.77

Centers of influence 6.26 .85

Examine records 3.64 1.50

Public exhibitions 4.26 1.76

Referral approach 6.77 .43

Introduction approach 5.97 1.31

Community contact 5.97 .97

Non-competing salespeople 5.23 1.40

Contact organizations 5.13 1.45

Pre-notification ("warm call") 4.82 1.64

Personal networking 6.31 1.08

Constant

Model Chi-Square/dof/p <

-2LL

Pre-Approach

Prospecting information 5.13 1.34

Intermediary approach 4.10 1.79

Direct Contact approach 5.79 1.26

Constant


-2LL

Approach

Prospecting-focused approach 5.41 1.58

Product-benefit approach 4.41 1.82

Statement approach 5.97 1.01

Peak interest approach 2.69 1.62

Constant


-2LL

Presentation

Ask prospect questions 6.36 .81

Tailored (customized) presentation 5.82 1.07

Help prospect visualize offering 5.59 1.04


Talk prospect's language 5.90 1.19

Partially standardized presentation 5.33 1.08

Use competitor comparisons 3.23 1.46

Need-satisfaction approach 6.59 .68

Use showmanship/dramatic efforts 3.05 1.64

Standardized/"canned" presentation 2.64 1.37

Constant


-2LL

Overcoming Objections

Direct answer method 5.90 1.12

Non-dispute method 3.46 1.35

Offset method 5.15 1.35

Dispute method 3.18 1.69

Comparative item method 3.71 1.58

Turn-around ("boomerang") method 4.44 1.52

Constant


-2LL

Closing

Straightforward close 5.74 .91

Presumptive close 5.56 1.23

Clarification close 4.72 1.52

Arousal close 4.95 1.52

Minor-decision close 5.18 1.32

Single obstacle close 5.26 1.22

Use silence 4.50 1.70

Constant


-2LL

Follow-Up Service

Follow-up cust. questions/complaints 6.51 .79

Periodic follow-up of cust. satisfaction 6.26 .82

Reassure the customer 6.05 1.02

Proper billing procedures & policies 5.54 1.05

Send thank-you notes to customers 5.44 1.43

Constant


-2LL

High

Performers

n = 34

Std.

Selling Technique Mean Dev.

Prospecting

Personal observation/research 6.47 .90

"Cold call" in person ("canvass") 2.53 1.81

"Cold call" by mail 2.76 1.84

"Cold call" by telephone 2.82 1.88

Use "cold call" specialists 1.97 1.27

Prospect Inquiries 3.71 1.88

Centers of influence 6.35 .98

Examine records 3.76 1.72

Public exhibitions 4.53 1.73

Referral approach 6.68 .59

Introduction approach 6.15 1.10

Community contact 5.53 1.38

Non-competing salespeople 4.41 1.86

Contact organizations 4.35 1.69

Pre-notification ("warm call") 3.47 1.80

Personal networking 6.06 1.20

Constant


-2LL

Pre-Approach

Prospecting information 4.76 1.84

Intermediary approach 4.50 2.06

Direct Contact approach 5.68 1.57

Constant


-2LL

Approach

Prospecting-focused approach 5.65 1.30


Statement approach 5.56 1.50

Peak interest approach 2.38 1.39

Constant


-2LL

Presentation

Ask prospect questions 6.21 .84

Tailored (customized) presentation 5.85 1.28

Help prospect visualize offering 6.00 1.21


Talk prospect's language 6.06 1.10

Partially standardized presentation 4.76 1.56

Use competitor comparisons 2.47 1.42

Need-satisfaction approach 6.79 .64

Use showmanship/dramatic efforts 2.91 1.69

Standardized/"canned" presentation 2.74 1.68

Constant


-2LL


Direct answer method 5.82 1.29

Non-dispute method 3.88 1.75

Offset method 5.03 1.49

Dispute method 2.97 1.62

Comparative item method 3.03 1.60

Turn-around ("boomerang") method 4.29 1.53

Constant


-2LL

Closing

Straightforward close 5.24 1.71

Presumptive close 5.15 1.64

Clarification close 4.32 1.74

Arousal close 4.47 1.78

Minor-decision close 4.68 1.72

Single obstacle close 4.50 1.63

Use silence 5.09 1.29

Constant


-2LL

Follow-Up Service

Follow-up cust. questions/complaints 6.47 .96

Periodic follow-up of cust. satisfaction 6.26 .83

Reassure the customer 6.15 .89

Proper billing procedures & policies 5.48 1.56

Send thank-you notes to customers 5.41 1.78

Constant


-2LL

Selling Technique Coefficient

Prospecting

Personal observation/research .8144

"Cold call" in person ("canvass") -.4472

"Cold call" by mail .2577

"Cold call" by telephone .3441

Use "cold call" specialists -.7786(*)

Prospect Inquiries -.0294

Centers of influence 1.2500(*)

Examine records 1.1002(*)

Public exhibitions .9337(**)

Referral approach -1.2278

Introduction approach .7239

Community contact -.6855

Non-competing salespeople -.9396(*)

Contact organizations -.3449

Pre-notification ("warm call") -1.0880(*)

Personal networking -.2185

Constant -.1244

Model Chi-Square/dof/p < 44.15/16/.0002

-2LL 55.436

Pre-Approach

Prospecting information -.1756

Intermediary approach .1342

Direct Contact approach -.0310

Constant .3327


-2LL 98.69

Approach

Prospecting-focused approach .0985

Product-benefit approach -.0021

Statement approach -.2699

Peak interest approach -.1463

Constant 1.2615


-2LL 97.662

Presentation

Ask prospect questions -.8330

Tailored (customized) presentation -.2025

Help prospect visualize offering 1.2810(**)

Product-benefit approach -.8689(**)

Talk prospect's language .3900

Partially standardized presentation -.7795(*)

Use competitor comparisons -.1776

Need-satisfaction approach .4534

Use showmanship/dramatic efforts -.0860

Standardized/"canned" presentation .2355

Constant 2.0093


-2LL 70.023


Direct answer method -.1633

Non-dispute method .2482

Offset method -.1492

Dispute method .0255

Comparative item method -.4558(*)

Turn-around ("boomerang") method .0533

Constant 1.8349


-2LL 85.830

Closing

Straightforward close -.1080

Presumptive close -.2327

Clarification close .1321

Arousal close -.1308

Minor-decision close .0322

Single obstacle close -.5087(*)

Use silence .5329(*)

Constant 1.4792


-2LL 82.10

Follow-Up Service

Follow-up cust. questions/complaints -.1517

Periodic follow-up of cust. satisfaction -.0429

Reassure the customer .1857

Proper billing procedures & policies -.0024

Send thank-you notes to customers -.0284

Constant .1210

Model Chi-Square/dof/p < .422/5/.9947

-2LL 98.89

Wald

Selling Technique Statistic

Prospecting

Personal observation/research 2.05

"Cold call" in person ("canvass") 2.40

"Cold call" by mail 0.34

"Cold call" by telephone 0.74

Use "cold call" specialists 4.15

Prospect Inquiries 0.01

Centers of influence 4.36

Examine records 5.95

Public exhibitions 6.80

Referral approach 1.81

Introduction approach 2.01

Community contact 1.48

Non-competing salespeople 4.64

Contact organizations 0.78

Pre-notification ("warm call") 6.03

Personal networking 0.28

Constant 0.00


-2LL

Pre-Approach

Prospecting information 1.27

Intermediary approach 1.06

Direct Contact approach 0.03

Constant 0.05


-2LL

Approach

Prospecting-focused approach 0.323

Product-benefit approach 0.000

Statement approach 1.806

Peak interest approach 0.788

Constant 0.581


-2LL

Presentation

Ask prospect questions 2.874

Tailored (customized) presentation 0.373

Help prospect visualize offering 9.108

Product-benefit approach 7.213

Talk prospect's language 1.779

Partially standardized presentation 5.468

Use competitor comparisons 0.563

Need-satisfaction approach 0.869

Use showmanship/dramatic efforts 0.145

Standardized/"canned" presentation 1.056

Constant 0.261


-2LL


Direct answer method 0.478

Non-dispute method 1.680

Offset method 0.499

Dispute method 0.024

Comparative item method 5.256

Turn-around ("boomerang") method 0.078

Constant 0.863


-2LL

Closing

Straightforward close 0.205

Presumptive close 0.847

Clarification close 0.443

Arousal close 0.296

Minor-decision close 0.013

Single obstacle close 3.908

Use silence 5.39

Constant 0.688


-2LL

Follow-Up Service

Follow-up cust. questions/complaints 0.153

Periodic follow-up of cust. satisfaction 0.015

Reassure the customer 0.328

Proper billing procedures & policies 0.000

Send thank-you notes to customers 0.249

Constant 0.002


-2LL

Selling Technique Significance

Prospecting

Personal observation/research .151

"Cold call" in person ("canvass") .120

"Cold call" by mail .557

"Cold call" by telephone .387

Use "cold call" specialists .041

Prospect Inquiries .920

Centers of influence .036

Examine records .014

Public exhibitions .009

Referral approach .178

Introduction approach .156

Community contact .223

Non-competing salespeople .031

Contact organizations .375

Pre-notification ("warm call") .014

Personal networking .595

Constant .981


-2LL

Pre-Approach

Prospecting information .257

Intermediary approach .303

Direct Contact approach .857

Constant .806


-2LL

Approach

Prospecting-focused approach .569

Product-benefit approach .988

Statement approach .178

Peak interest approach .374

Constant .445


-2LL

Presentation

Ask prospect questions .090

Tailored (customized) presentation .514

Help prospect visualize offering .002

Product-benefit approach .007

Talk prospect's language .182

Partially standardized presentation .019

Use competitor comparisons .452

Need-satisfaction approach .351

Use showmanship/dramatic efforts .702

Standardized/"canned" presentation .304

Constant .609


-2LL


Direct answer method .489

Non-dispute method .194

Offset method .479

Dispute method .876

Comparative item method .021

Turn-around ("boomerang") method .779

Constant .352


-2LL

Closing

Straightforward close .650

Presumptive close .357

Clarification close .505

Arousal close .586

Minor-decision close .909

Single obstacle close .048

Use silence .020

Constant .406


-2LL

Follow-Up Service

Follow-up cust. questions/complaints .695

Periodic follow-up of cust. satisfaction .901

Reassure the customer .566

Proper billing procedures & policies .993

Send thank-you notes to customers .874

Constant .956


-2LL

(**) p < .01

Logistic regression analysis was used to identify the CSFs that best differentiated

observations from the two groups. Logistic regression was appropriate because the

dependent variable, sales performance, was dichotomous--high versus low

performing salespersons. Further, logistic regression is recommended for statistical

use in predicting group membership by assessing the influence (i.e., sign and

magnitude) of an independent variable on a change in the dependent variable (Hair

et al. 1995; Tansey et al. 1995).

Analyses were completed for each of the seven stages of the personal selling

process. The resultant coefficients for each of the selling techniques are interpreted

in a manner similar to those in multiple regression. In multiple regression, the

coefficient indicates the amount of change in the dependent variable for a one-unit

change in the independent variable. In logistic regression, the coefficients are

measures of change in the odds (logged) of an event occurring with a one-unit

increase in an independent variable. In this study, significant positive (negative)

coefficients indicated the increasing likelihood of a salesperson being a high (low)

performer as the selling technique increases in use (Hair et al. 1995; Norusis 1990).

Results

Table 2 presents the coefficients and Wald statistics for the logistic regression

analyses. For the high and low performing salespeople groups, significant differences

were found within four of the seven stages in the sales process. A total of twelve

variables (out of 51) were found to be significant (p [is less than] .05) within these

four stages. These were: Prospecting: Use "Cold Call" Specialists ([Beta]=-.78; p [is

less than] .05), Centers of Influence ([Beta]=1.25; p [is less than] .05), Examine

Records ([Beta]=1.10; p [is less than] .05), Public Exhibitions ([Beta]=.93; p [is less

than] .01), Non-Competing Salespeople ([Beta]=-.94; p [is less than] .05), and

Presentation Notification ("Warm Call") ([Beta]=-1.09; p [is less than] .05);

Presentation: Help Prospect Visualize Offering ([Beta]=1.28; p [is less than] .01),

Product-Benefit Approach ([Beta]=-.87; p [is less than] .01), and Partially

Standardized Sales Presentation ([Beta]=-.78; p [is less than] .05); Overcoming

Objections: Comparative Item Method ([Beta]=-.46; p [is less than] .05); and Closing:

Single Obstacle Close ([Beta]=-.51; p [is less than] .05) and Use Silence ([Beta]=.53;

p [is less than] .05).

Five of the techniques' coefficients were positive in sign, indicating distinctively

greater use by the high performing salespeople. Seven of the twelve techniques'

coefficients were negative, indicating characteristically greater use by the low

performing salespersons. Overall, these significant coefficients suggest that there are

critical selling techniques that distinguish high and low performing salespeople.

The two groups differed along several other variables. The high performers had on

average considerably more experience selling insurance (13 years versus 5 years)

and more overall sales experience (15 years versus 10 years). The high performers

also worked longer weekly hours (an average of 53 versus 47 hours), were slightly

more educated (17 years of education versus 16 years), and had a prospect base

with slightly more income. The low performing group had a larger percentage of their

sales from new customers compared to existing customers (an average of 78%

versus 49%).

No differences were found between the two groups in terms of salesperson gender,

marital status, age, percent of compensation based on commission, and competition

in the local market. Interestingly, no significant differences were found between the

groups with regard to the extent (measured in days) of their pre-contract training,

career training, or advanced training.

It thus appears that the two groups of salespeople are primarily distinguished by

their selling experience. This suggests that the selling techniques that top performers

have learned to use with great success may largely be a function of on-the-job

training and trial-and-error learning. It may also be that the low performing

salespeople have not yet learned what techniques are more (or less) appropriate and

tied to the success of the sale of homogenous goods such as insurance. If so, it may

behoove sales managers to train the low-performing salespersons in the sales

techniques and methods used successfully by top performers.

(**) p < .01

Logistic regression analysis was used to identify the CSFs that best differentiated

observations from the two groups. Logistic regression was appropriate because the

dependent variable, sales performance, was dichotomous--high versus low

performing salespersons. Further, logistic regression is recommended for statistical

use in predicting group membership by assessing the influence (i.e., sign and

magnitude) of an independent variable on a change in the dependent variable (Hair

et al. 1995; Tansey et al. 1995).

Analyses were completed for each of the seven stages of the personal selling

process. The resultant coefficients for each of the selling techniques are interpreted

in a manner similar to those in multiple regression. In multiple regression, the

coefficient indicates the amount of change in the dependent variable for a one-unit

change in the independent variable. In logistic regression, the coefficients are

measures of change in the odds (logged) of an event occurring with a one-unit

increase in an independent variable. In this study, significant positive (negative)

coefficients indicated the increasing likelihood of a salesperson being a high (low)

performer as the selling technique increases in use (Hair et al. 1995; Norusis 1990).

Results

Table 2 presents the coefficients and Wald statistics for the logistic regression

analyses. For the high and low performing salespeople groups, significant differences

were found within four of the seven stages in the sales process. A total of twelve

variables (out of 51) were found to be significant (p [is less than] .05) within these

four stages. These were: Prospecting: Use "Cold Call" Specialists ([Beta]=-.78; p [is

less than] .05), Centers of Influence ([Beta]=1.25; p [is less than] .05), Examine

Records ([Beta]=1.10; p [is less than] .05), Public Exhibitions ([Beta]=.93; p [is less

than] .01), Non-Competing Salespeople ([Beta]=-.94; p [is less than] .05), and

Presentation Notification ("Warm Call") ([Beta]=-1.09; p [is less than] .05);

Presentation: Help Prospect Visualize Offering ([Beta]=1.28; p [is less than] .01),

Product-Benefit Approach ([Beta]=-.87; p [is less than] .01), and Partially

Standardized Sales Presentation ([Beta]=-.78; p [is less than] .05); Overcoming

Objections: Comparative Item Method ([Beta]=-.46; p [is less than] .05); and Closing:

Single Obstacle Close ([Beta]=-.51; p [is less than] .05) and Use Silence ([Beta]=.53;

p [is less than] .05).

Five of the techniques' coefficients were positive in sign, indicating distinctively

greater use by the high performing salespeople. Seven of the twelve techniques'

coefficients were negative, indicating characteristically greater use by the low

performing salespersons. Overall, these significant coefficients suggest that there are

critical selling techniques that distinguish high and low performing salespeople.

The two groups differed along several other variables. The high performers had on

average considerably more experience selling insurance (13 years versus 5 years)

and more overall sales experience (15 years versus 10 years). The high performers

also worked longer weekly hours (an average of 53 versus 47 hours), were slightly

more educated (17 years of education versus 16 years), and had a prospect base

with slightly more income. The low performing group had a larger percentage of their

sales from new customers compared to existing customers (an average of 78%

versus 49%).

No differences were found between the two groups in terms of salesperson gender,

marital status, age, percent of compensation based on commission, and competition

in the local market. Interestingly, no significant differences were found between the

groups with regard to the extent (measured in days) of their pre-contract training,

career training, or advanced training.

It thus appears that the two groups of salespeople are primarily distinguished by

their selling experience. This suggests that the selling techniques that top performers

have learned to use with great success may largely be a function of on-the-job

training and trial-and-error learning. It may also be that the low performing

salespeople have not yet learned what techniques are more (or less) appropriate and

tied to the success of the sale of homogenous goods such as insurance. If so, it may

behoove sales managers to train the low-performing salespersons in the sales

techniques and methods used successfully by top performers.

Discussion

The study reported here evaluated what CSFs were associated with both great

success and low success in the performance of salespeople engaged in the sale of a

homogenous good (life insurance). A set of fifty-one performance behaviors, to a

large extent developed by Dubinsky (1980), were employed to evaluate the

importance of CSFs. Twelve CSFs were linked to high and low performance.

Six of the CSFs associated with high and low performance were prospecting

techniques. High-performing salespersons were more likely to use the Centers of

Influence, Examine Records, and Public Exhibitions techniques. Low performers were

more prone to use the "Cold Call" Specialists, Non-Competing Salespeople, and Pre-

Notification ("Warm Call") Approach techniques.

Three presentation techniques distinguished the top and bottom performers. Greater

use of the Help Prospect Visualize Offering technique characterized the top

performers. The use of Product-Benefit Approach and Partially Standardized Sales

Presentation characterized the poor performers.

The final three attributes differentiating high and low performers were found in

overcoming objections and closing strategies. The overcoming objections technique

of Comparative-Item Method was used significantly more by the poor performers, as

was the closing technique of Single Obstacle Close. Use Silence was employed more

so by the top performing sales group during the closing step.

Profile of High Versus Low Performance

The results provide an interesting picture of the critical practices that distinguish the

successful salespeople from the less successful. In the prospecting step of the

personal selling process, the top performers, for one, do not hesitate to cultivate and

employ prominent customers who can influence other potential life insurance buyers

on their behalf. They also are more willing than the poor performers to use and

examine directories and membership lists for leads. Top-performers also are not shy

with regard to participating in public seminars and exhibitions, recognizing them as

sound prospecting methods that perhaps offer the potential customer the ability to

meet the salesperson in a "neutral" setting in which they can assess the salesperson

in a more informal, low-pressure manner.

On the other hand, the poor performers use a more impersonal, detached

prospecting formula. Their significantly greater use of specialists such as junior

salespeople or staff workers to initiate contact with potential customers appears to

start them off at a disadvantage. This could be a reflection of the customer's distaste

for a once-removed form of personal contact or just an outcome of the quality of

service the cold call specialists provide. Similarly, mailing prospects a notification of

an impending personal contact is an indirect approach that lacks a personal touch.

Finally, the impersonal acquisition of names of potential prospects from non-

insurance salespeople may, when the inevitable question of "How did you get my

name?" arises, be perceived by the prospect as an affront or an indignity.

With regard to the activities related to the presentation of the product, clear

differences are again apparent between the two groups of salespeople. The top

sellers use two techniques to their advantage. First, they have a propensity to use

diagrams, printouts, and charts to more clearly explain the complex life insurance

products. In addition, these salespersons let the prospect make the final decision

uninterrupted, saying nothing during the final moments of the close. Both of these

techniques could be seen as non-manipulative, customer-oriented practices.

The less successful salespersons, on the other hand, tend to lean toward more

manipulative, soiling-oriented practices. They focus their presentations on the

product and its benefits--as opposed, perhaps, to the needs of the prospect. More

alarmingly, they change the sales presentation only slightly for each prospect,

essentially treating each prospect in an identical manner in terms of their process

needs. Additionally, they provide prospects two or more offerings to compare, forcing

choices between products--a potentially manipulative, product-oriented approach as

opposed to a needs-based focus to product selection. Finally, the low-performing

salespeople place strong emphasis on overcoming the single obstacle in the way of

the sale--perhaps to the detriment of taking a more positive, need-satisfying

approach to overcoming objections

Overall, the top-performing salespersons met their clients' process needs by taking a

more personal, customer-oriented focus. The practices that separated them from the

poor-performing salespersons relate closely to relationship-oriented selling (Jolson

1997). Poor-performing salespersons took a more sales-oriented, impersonal

approach that did not allow them to meet the unique, personal selling needs of their

customers. Inevitably, and for reasons perhaps beyond those speculated above, the

critical techniques they emphasized or failed to emphasize characteristically

distinguished them from their top-performing colleagues.

Research Implications

The results of this exploratory study suggest, at least in part, that performance

differences between high and low performing insurance agents can be traced back to

critical aspects of salesperson-client interactions. Broadly speaking, this implies that

in addition to meeting customers' product needs, upon which past sales research and

discussions have placed primary emphasis, researchers and sellers may be advised

to also focus on the sales process needs of the customer--needs relating to the

manner in which customers prefer salespersons to communicate and sell to them

over the course of the personal selling process (Szymanski 1988).

One interesting research finding in this study relates to the seven techniques that

were used significantly more so by the low performing salespeople. While CSFs can

be defined as those practices that increase the probability of success, these seven

techniques appear to potentially inhibit the chances of success. The CSF literature

distinguishes such practices as critical failure factors (CFFs) and recognizes the

importance of identifying and controlling such barriers to success (Dickinson,

Ferguson and Sircar 1984; Ferguson and Dickinson 1982; Williams and Ramaprasad

1996). This research has empirically verified the existence of critical failure factors in

a sales setting.

Implications for Sales Managers

The critical selling techniques that distinguish the top and bottom performers in a

firm have considerable prescriptive contributions to offer sales management with

regard to selling effectiveness. First, in a manner similar to that done in this study,

the critical techniques used to a more significant extent by the top sellers should be

identified. An assessment should then be made as to why the poor-performing

salespersons underutilized these techniques. It may be that they are not aware of

them or were not well trained in their application. The firm should then consider

introducing (or reintroducing) the techniques to these salespersons and training them

in their use.

Similar assessment needs to be made of those techniques characteristically favored

by the poor performing salespeople. To the extent that these techniques are found

inappropriate in meeting the sales process needs of the firm's customers, sales

management may consider extinguishing their use among the sales force. The sales

effectiveness of these salespeople should he appreciably increased as a result. The

benefits of these sales process adjustments would ultimately accrue to the customer,

whose sales process needs would more closely be met and whose satisfaction would

more likely be achieved.

Limitations and Directions for Future Research

Several limitations within this study should be noted. First, this study examined only

one industry--life insurance--and only one firm. As such, its conclusions may not

generalize to other industries or even other life insurance firms. Secondly, focus was

placed on the seller side of the salesperson-customer dyad. Future research should

examine customer preferences with regard to the selling techniques surveyed in this

study. A more valid representation of customer sales process needs could then be

established. Additionally, this research examined critical salesperson practices as

defined by a set of 51 selling techniques. Sales practices and behaviors can be

measured in other ways, an examination of which awaits future research.

an empirical investigation of critical success factors in the personal selling process for...

Documents

selling success

sales success

critical success factors

sales presentation

performance measures

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potential csfs