Salesforce Strategy: 50 vs 5,“Less Is More Won the Finale

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We hope that this Food for Thought finds you well and that you are experiencing continuous success.


50 vs 5, "Less is more" won the finale

  

In the salesforce, isn’t “more is better”? always the case  - isn’t it a common belief that it’s always best to engage more sales representatives in the marketplace to generate more sales revenue? However, our latest research findings may overturn this logical reasoning. 

 

We studied on a salesforce of a US brand and of a South Korean (SK) brand in the medical beauty industry, both brands are bestsellers, sharing similar sales revenue in the marketplace. However, The US brand has 3 times the amount of sales representatives and 10 times the amount of key account (KA) managers than the SK brand., This made us questions their approach. How did the SK brand manage to engage less but yield more?

 

The truth lies in the definition of the key account customer.  The SK brand sets their selection criterion so high that only countable (within 5) KA customers are able to meet their criterion. As a result, a one-off order of a SK KA customer purchases approximately 50 times more than a US KA customer in terms of purchase volume. This shows that the SK KA only needs to deal with a limited KA at the national level, while the US KA has set its salesforce in more regions and has to deal with sales at the regional level. Finally, they both yield similar sale revenue but differ in efforts and labor costs. 

 

In the end, “less is more” won the comparison.

 

Thank you so much for your constant support!  We hope that you found this Food for Thought helpful.  In case you would like to work with us, please feel free to let us know. We would be delighted to hear from you. 

 

Thank you and best regards,


KateChanResearch

Specializing in Strategy-oriented Research, Data Mining and Data Interpretation.

Copyright © KateChanResearch (www.KateChanResearch.com)

Created on:2017-12-27 09:45
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