Marketing: It’s the salesperson-customer tie that spells success

COLUMBIA, MO.
October 17, 2007 5:43pm

It’s a customer’s loyalty toward the salesperson – rather than the products and services tied closely to the seller – that can inspire greater sales, according to a new marketing study by the University of Missouri-Columbia.

But there’s a major downside, the researchers say.

That person-to-person loyalty can make the company more vulnerable.

Based on their findings, the researchers strongly recommend that businesses develop strategies that encourage not only salesperson loyalty, but also enhance the company’s products and value.

Doing so results in loyalty to both the company and salesperson; in the long run, it is good for sales and revenues, says Lisa Scheer, associate professor of marketing in the University of Missouri College of Business.

“Companies that believe they understand loyalty among their customers may be fooling themselves,” says Ms. Scheer. “They may not really understand precisely where that loyalty is directed. Is it to specific individuals who service them and work with them, or is it with the company and its products or brands?”

She says despite having multiple sources to purchase from and numerous resources to compare prices, the bond between buyer and salesperson greatly influenced the transaction.

“Companies need to understand the drivers behind customer loyalty. Is it vested in elements the company really controls and owns – like the brand, trademarks and products? Or, is it vested more in things that are not under the company’s control? What happens if a salesperson leaves to join a competitor?” she asks. “To ignore where loyalty is truly directed puts a company at risk.”

The study was conducted by Robert Palmatier, assistant professor of marketing in the Michael Foster School of Business at the University of Washington; Lisa Scheer, associate professor of marketing in the MU College of Business; and Jan-Benedict E.M. Steenkamp, marketing area chair of the Kenan-Flagler Business School at the University of North Carolina at Chapel Hill.

The study focused on business-to-business relationships between 362 industrial buyers and the manufacturers' representative salespeople who market products to buyers in a wide-range of industrial markets.