[Marketing Mantra] Sales Outsourcing in India

[Loganathan Arumugam]

It’s quite an obvious question among many people asking for the difference between Marketing and Sales, the answer is very simple, marketing is a process to bring a sale which is the ultimate objective any business. We do marketing to bring in sales and anything that we do to make a sale comes under marketing. Some products need more of one to one personal interaction that we are referring as Direct Marketing and some deserves mass communication and promotions. Most of B2B products falls under first category with more dependency on product/service detailing that needs sufficient sales force.

This blog article is trying to explore an emerging trend in sales force management where in the sales force is not managed by the brand owners but are completely outsourced to a third party. SALES OUTSOURCING? Yes, there are many small pocketed companies that couldn’t afford for brand building activities and couldn’t manage a huge sales force wherein the monthly fixed expenses for paying the remuneration is high, irrespective to the sales turnover are appointing 3^rd party agencies to do sales on their behalves on commission basis. This concept is completely different from contractual staffing or sales support through BPOs or authorizing the agency as the dealer or a distributor for the product or service.

Sales Outsourcing, to my understanding has got its roots from the media industry where ad space sales happens via sales outsourcing concepts and the same is applicable for bringing in PR articles through freelance reporters. If you have a good product in basket but you still don’t want to appoint sales force then the best idea would be approaching a Sales Outsourcing agency. A good Sales Outsourcing agency will not take a deal blind blank, rather only if they feel the real potential for the product proposed then only they will show interest to take the business.

Having said these, brand owners do support the outsourcing agencies with marketing material and also bearing the marketing expenses for promoting their brand if anything proposed by the agency.

I’m not sure if this Sales Outsourcing Concept is at a dormant stage in India or it has gained the momentum with evident results being enjoyed by the brands that are practicing Sales Outsourcing concept. However, I would like to discuss the pros and cons that this concept has which would look so obvious but have real significance.

Pros:

• No fixed expenses on sales force for the brand owners
• Though brands doesn’t have full control over the team, they can give proper advice and suggestion about the prospective crowd for making the sale
• Agencies have the option of utilizing the man power for more than one brand by fixing suitable product if prospective client is found

Cons:

• No control over the product knowledge enhancement among the sales force though the agencies promises for salesmanship and product training
• SO agency must convert the sale to have their Piggies filled consistently
• It would be very difficult to maintain the commitment level out from the dependency created on the agency if the brand doesn’t have any other sales channel
• The leads generated today may not be prospective one unless it is converted as a sale

Being a start-up company or small/mid-sized company, the brand owner shouldn’t rely on a third party completely unless they are really thorough with the actual response that they are getting from the market by having the real hardcore experience on the field for sales by themselves or with their own sales team. Nobody else can convert a better sale for your product than what you can actually do for it. 

--
Posted By Loganathan Arumugam to Marketing Mantra at 10/26/2011 07:56:00 AM