Page 78 - DMGT507_SALES AND PROMOTIONS MANAGEMENT

Sales and Promotions Management

Notes 4. Employee Services: These include subsidised meals, recreational facilities, discount on
company's products, etc.
5. Cafeteria Approach: In this the employees choose the desired benefits. This is a new
approach in which there is a basket of benefits and the employee opts for some of these
which are more beneficial to him.

Task Find out the compensation practices of some of the best sales organisations
in India.
3.3 Summary

The primary purpose of motivation is to aid salesmen to satisfy their goals by stimulating
them to improve the efficiency of their work.

Motivation is specially required in sales management as the nature of job is different from
the usual work that the other members of the organisation are engaged in.
Maslow argued that needs form a hierarchy in the sense that, when no needs are fulfilled,
a person concentrates upon his or her physiological needs. When these needs are fulfilled,
safety needs become preponderant and become important determinants of behaviour and
he moves so on up the hierarchy.
Herzberg’s dual factor theory distinguished factors which can cause positive dissatisfaction
but cannot motivate (hygiene factors) and factors which cannot cause positive motivation.
Most salesmen prefer the financial benefit because the need at the lower level of organisation
is more of physiological and safety needs, rather than those of esteem and self actualisation.

Sales compensation plans are aids to, rather than substitutes for, effective motivation. The
basic appropriateness of a compensation plan is important and so is the way it is
implemented and administered.
Companies use mostly one of the following plans: Straight Salary Plan, Commission plan
and Salary plus commission plan.

Bonuses are paid for reaching a sales quota, performing promotion activities, obtaining
new accounts, following up leads, setting up displays or carrying out other assigned task.
The variety of fringes has expanded, individual fringes have been added that appeal more
to some groups than others -people with bad teeth are the ones most interested in dental
insurance while those with children are the ones most interested in plans for paying
education and tuition fees for dependents.

3.4 Keywords

Bonus: An amount paid for accomplishing a specific sales task

Commission Plan: Sales persons are paid according to productivity
Fringe Benefits: Benefits other than monetary and incentives like insurance etc.
Hygiene Factors: Factors that cause positive dissatisfaction but cant motivate
Motivation: Psychological aspect and drives salesman behavior
Physiological Needs: Basic needs of food, clothing, shelter etc.

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