2021 7.3 Research Review – edited by Jeremy Noad
27th July 2021 | Dr Jeremy Noad
The research review aims to help readers keep up to date with recently published research on sales-related topics. The review highlights short abstracts of academically peer-reviewed research. This selection of published research is from a range of academic journals. In this edition, the abstracts include four themes that focus on sales performance, customer management, capability development and sales behaviours.
Decision making is critical
Making correct decisions regarding the merit of sales opportunities and deciding which opportunities to pursue and which to abandon is one of the most critical tasks sales managers and salespeople grapple with. These frontline assessments typically become sales forecasts that are used to allocate resources within the firm. Assessments of future sales, however, are often inaccurate. Little is known about how salespeople and sales managers make decisions about sales opportunities or differ in their ability to (correctly) assess the merits of such opportunities. To address this research gap, we explore several decision-making biases – namely, optimism, confidence, and overconfidence – through the lenses of both Psychological Momentum (PM) and Strategic Reference Point (SRP) theory. Analysis of rich CRM data from a Fortune 500 medical products company, across three studies, demonstrates notable differences between salespeople and sales managers concerning decision-making biases that influence their evaluations of sales opportunities.
Spotting the value requires knowledge of the customer
In B2B markets, firms seek to provide customer solutions instead of merely selling goods or services. As boundary-spanners, salespeople are pivotal for implementing this strategic shift. The extant literature provides limited insights into salesperson’s resources and competencies required for customer solutions, particularly in the early phases of solution selling. This research focuses on salesperson’s value opportunity recognition competence (VOR), which is a central requirement for salespeople to navigate the early phases of solution selling. Analysing large-scale, multi-level data of 799 salespeople and their respective sales managers in 29 sales organisations, the authors investigate the role of different salesperson resources and work environment characteristics for strengthening their VOR. The authors find that salespeople need both customer and technical knowledge, but customer knowledge is more important. Salespeople also can substitute individual technical knowledge with strong internal relations. Still, strong customer relations are no substitute for individual knowledge about customers’ business models and processes. Formalisation turned out to be a double-edged sword in VOR development, while transformational leadership has positive effects only. The findings bear concrete implications for improving the selection, training, and work environment of solution salespeople.
salespersons’ value opportunity recognition competence in solution selling”, Journal of Personal Selling & Sales Management, 40(3), 180-197.
Little is known about how salespeople and sales managers make decisions about sales opportunities or differ in their ability to (correctly) assess the merits of such opportunities.
Communication skills still relevant to digital selling
B2B buyers are exhibiting an increased preference to transact digitally with vendors. A topic which has yet to receive sufficient academic attention in this modern selling environment is salesperson communication effectiveness. Accordingly, this article: 1) defines digital sales interactions (DSIs) as technology-enabled, face-to-face buyer-seller exchanges; 2) proposes a typology of DSIs to set the stage to examine salesperson communication effectiveness; 3) introduces a framework that reifies the sender’s auditory and visual cues that can influence receivers’ thoughts (ie, cognition, affect, intention) and activity (ie, purchase behaviour, advocacy); 4) suggests theoretical lenses that can illuminate various aspects of the salesperson’s communication barrage; 5) advances how machine learning can be applied to understand what constitutes effective communication in a digital interaction by asking: to what extent does what a salesperson says (auditory cues) and how s/he says it (visual cues) impact her/his effectiveness in a DSI? and 6) concludes by noting promising future research directions for B2B marketing researchers.
Bharadwaj, N, & Shipley, G M (2020), “Salesperson communication effectiveness in a digital sales interaction”, Industrial Marketing Management, 90, 106-112.
Reinforce value over price in times of crisis.
When economic crises disrupt markets and stifle sales, business-to-business (B2B) vendors are often tempted to respond by offering temporary price reductions to maintain sales and empathise with the customers’ plight. This, however, may be a suboptimal strategy in plain sight. In this article, we propose an alternative approach. We suggest that value-based selling is a particularly suitable and mutually beneficial, yet often counter-intuitive strategy to selling in an economic crisis. We draw on the well-established organisational boundary theory to explain why economic crises should make customers more receptive to boundary changes that support value-based selling. Subsequently, we develop managerial insights on how vendors can capitalise on these opportunities by demonstrating how boundary changes can help customers reduce immediate costs while retaining their competitiveness to grow when the economy recovers.
Keränen, J, Salonen, A, & Terho, H (2020), “Opportunities for value-based selling in an economic crisis: Managerial insights from a firm boundary theory”, Industrial Marketing Management, 88, 389-395.
Is your customer dependent on you?
One of the main risks in B2B relationships is the potential for partners to switch to competitors. Decreasing the likelihood of partner switching can result from increasing partner dependence. To date, there has been little research investigating the different mechanisms and antecedents of dependence in B2B relationships. We examine two components of dependence to fill this important gap: relationship value dependence and switching cost dependence. Our results indicate different paths to dependence based on commitment and trust level in the partner. Dependence can either enhance the relationship through increased benefits of the relationship or the creation of latent switching costs the partner would expect if the relationship ended. Trust moderates the relationship between commitment and dependence but has a differential impact on dependence based on the form of commitment. We discuss implications for research and practice.
Padgett, D, Hopkins, C D, & Williams, Z (2020), “Buyer dependence in B2B relationships: The role of supplier investments, commitment form, and trust”, Journal of Business Research, 119, 13-24.
Strong customer relations are no substitute for individual knowledge about customers’ business models and processes.
Frequent purchases predict customer behaviour.
The valuation of future customer activity is a mainstay of any organisation seeking to efficiently manage its customer portfolio. In customer-base analytics, the ongoing race for predictive power has yielded a large corpus of research to assist managers in this respect. Approaches in the tradition of stochastic models have been particularly successful because they rely only on easy-to-compute key metrics and integrate them within a parsimonious probability-modelling framework. Recent advances in this field have demonstrated that incorporating past purchases’ timing regularity can improve predictive accuracy relative to purely recency/frequency-based approaches. This paper expands that idea and introduces generalisations of a well-established probability model, the BG/NBD (Fader et al., 2005a), by replacing the exponential with a more flexible Erlang-k interarrival timing process. The resulting model variants can leverage regularity while retaining almost the same level of data requirements and algorithmic efficiency. Using extensive simulation studies and six data sets covering a wide range of empirical settings, the authors demonstrate substantial improvements in predictive accuracy against the baseline models and performance gains close to or on par with a more complex model alternative. The availability of efficient and easily accessible implementations of the new model variants in the R-package BTYDplus allows marketing analysts to apply them in large-scale scenarios of data-rich environments continuously.
Reutterer, T, Platzer, M, & Schröder, N (2020), “Leveraging purchase regularity for predicting customer behaviour the easy way”, International Journal of Research in Marketing.
Salespeople still not meeting buyers’ expectations.
As the focus on salespeople’s effectiveness has increased, we concentrate on the fact that selling involves broad sets of actors and investigate salespeople’s approaches and behaviours from the purchasing agent’s perspective to develop a deeper theoretical understanding of the effectiveness of salesperson strategies. Our focus is on the purchasing function that is increasingly involved in the buying process. We examine a central research question – how does the purchasing function view salespeople’s strategies and behaviours? We describe the results of in-depth interviews with 35 purchasing executives that focused on how the purchasing function views salespeople’s strategies and behaviours. The findings suggest that salespeople, in general, do not focus enough on the needs of the purchasing function. Salespeople are not meeting the purchasing function’s needs, and purchase-centred sales strategies may need to be developed. These findings have theoretical and managerial implications and offer directions for future research in this area.
Paesbrugghe, B, Rangarajan, D, Hochstein, B, & Sharma, A (2020), “Evaluation of salespeople by the purchasing function: implications for the evolving role of salespeople”, Journal of Personal Selling & Sales Management, 40(4), 289-305.
This study finds that female managers are more prone to bias when evaluating male candidates than male managers.
Gender bias in the recruitment of entry-level B2B salespeople
In response to calls to reduce the gender gap in the salesforce, this study examines the effect of candidate gender, manager gender and industry to explain gender bias in salesperson recruitment during screening and skill assessment. This paper tested the hypotheses using observational data from a national sales competition in the USA, where managers evaluated student candidates for entry-level sales positions. This research finds gender bias during screening using the dyadic perspective. Specifically, female managers evaluate male candidates more favourably than male managers do during screening. Further, managers of service companies evaluate female candidates more favourably than managers of goods companies during screening. However, this paper finds no such effects during candidates’ skill assessment. Managers should not use short interactions to screen candidates. Implicit bias exists when candidates and managers interact during screening. To reduce gender bias in recruitment, the candidates and managers should interact for a longer duration. This study draws upon a unique setting, where the candidates interact with the managers for screening and skill assessment. Implicit bias exists when candidates and managers interact for screening under time pressure. This paper finds no evidence of gender bias in skill assessment. This study finds that female managers are more prone to bias when evaluating male candidates than male managers. Prior work has not examined industry-based bias; this paper provides evidence of such bias in candidate screening.
Ashnai, B, Mani, S, Kothandaraman, P, & Shekari, S (2020), “Gender bias in the recruitment of entry-level B2B salespeople”, Journal of Business & Industrial Marketing.
Students still don’t see sales as a career choice
Businesses face a challenge recruiting and maintaining a high-quality salesforce. Increasingly, recruiting focus for entry-level sales positions has turned to university business students and sales centres. Unfortunately, research shows that most students have persistent negative misconceptions about professional sales careers. There is little research examining comprehensive and structured decision-making frameworks used by students when evaluating a sales career. This paper develops and tests an integrative framework that maps students’ decision-making process to their intention to pursue a sales career. Specifically, we examine how perceived sales knowledge, perceptions of selling ethics, perceptions of salespeople, and perceptions of the selling profession impact their intent to pursue a sales career both pre-and post-exposure to sales professionals in the classroom. Utilising structural equation modelling, we investigate the interactive relationships of these four areas (sales knowledge, selling ethics, salespeople, and the selling profession) on intent to pursue. Results show empirical evidence of how sales professionals affect the structural orientation of students’ intention to pursue a sales career and constructs hypothesised to impact this intent after only one interaction. The findings offer an opportunity for how businesses may increase student interest in both sales and their organisation.
Cummins, S, & Peltier, J W (2020), “Understanding students’ decision-making process when considering a sales career: a comparison of models pre-and post-exposure to sales professionals in the classroom”, Journal of Personal Selling & Sales Management, 1-16.
Results show empirical evidence of how sales professionals affect the structural orientation of students’ intention to pursue a sales career.
Managers’ internal status impacts salespeople’s success
Despite recent attention from scholars, internal networking remains underexplored in the sales literature, particularly with respect to its effect on longitudinal measures of performance. The current research addresses this notable omission by examining the interactive effect of salespeople’s internal networking ability and their supervisor’s organisational status on performance growth trajectories. Utilising 20 quarters of individual, financial performance data from 113 salespeople at a warehousing equipment manufacturer, we find that both internal networking and a supervisor’s organisational status drive a salesperson’s performance growth trajectory. However, these two variables’ interaction negatively – and counter-intuitively – affects the performance growth trajectory. Supervisors with high organisational status attenuate (buttress) their high (low) networking salespeople’s performance growth. Taken together, these results reveal an important boundary condition regarding the efficacy of internal networking. They underscore the importance of sales managers in shaping the effectiveness of their salespeople’s internal networking efforts.
Lee, N Y, Dugan, R, Rouziou, M, & Anwar, A (2020), “‘Give me one but not the other’: the substitution effects of supervisor’s organisational status and salesperson internal networking on performance growth trajectories”, Journal of Personal Selling & Sales Management, 1-11.
Managers leadership styles trigger employee turnover
Given that salesperson turnover is a significant problem for sales organisations, sales researchers have devoted a lot of attention toward explicating various drivers and mitigators of salesperson turnover intentions. Within this domain, consistent with the popular sentiment “employees don’t quit their jobs; they quit their bosses”, scholars have explored sales manager-related triggers such as leadership style, salesperson-sales manager relational exchange, and several managerial characteristics. We extend this stream of research by developing and testing a framework of salespersons’ perceptions of their manager’s leadership worthiness – a higher-order construct comprising competence, charisma, and behavioural integrity – and its subsequent impact on salesperson turnover intentions. Our framework illustrates that salespersons’ inferences, judgments, and attributions regarding their manager exert a pull-to-stay effect by lowering turnover intentions. Specifically, we find that leadership worthiness mitigates turnover intentions directly and indirectly via personal identification and trust in the manager. We also find support for the moderating effects of salesperson gratitude on the relationships between leadership worthiness and both salesperson turnover intentions and identification with the manager. We conclude by discussing the theoretical and practical implications of our findings and directions for future research.
Badrinarayanan, V, Gupta, A, & Chaker, N N (2020), “The pull-to-stay effect: influence of sales managers’ leadership worthiness on salesperson turnover intentions”, Journal of Personal Selling & Sales Management, 1-17.
Overcoming emotional exhaustion requires more than grit
The purpose of this paper is to investigate how sales organisations can become sustainable by reducing or mitigating emotional exhaustion in their sales employees. Specifically, this paper examines how organisational support, sales creativity, grit, and emotional engagement impact emotional exhaustion. A sample of 361 business-to-business sales employees across various organisations and industries was included in the study. Results indicated that perceived organisational support and emotional engagement negatively influenced emotional exhaustion. However, grit and sales creativity did not directly impact emotional exhaustion, both positively impacted emotional engagement. For sales organisations, these findings have important applications. First, employers need to hire employees that exhibit high levels of grit and sales creativity. Second, organisations need to provide a supportive and creative environment in order to minimise the impact of emotional exhaustion for their sales employees.
Matthews, L M, & Edmondson, D R (2020), “Overcoming emotional exhaustion in a sales setting”, Journal of Global Scholars of Marketing Science, 30(3), 229-239.
Articles featured in the Research Review are not available from the editorial staff or the International Journal of Sales Transformation. Readers wishing to find out more about a particular paper can use a simple search online using the author and paper title to find out more details on the paper. The copyright of the articles is acknowledged to the publishers and authors. Any correspondence regarding Research Review, including recommendations of articles for future issues, should be sent to the section editor: Jeremy.Noad@port.ac.uk.