HomeSales Essentials BlogThe History of Sales Methodologies – Part I
The History of Sales Methodologies – Part I
19th century.
Sales is a complex profession. People in this field not only have to deal with the intricacies of being a salesperson -as most people deal with the ins and outs of their profession- but they also have to deal with the less than honourable image that being a salesperson has.
But why? Where did it all start?
The profession of selling is one of the oldest ones in the history of the world, so what happened to cause it to develop such a negative reputation that most people don't want to be associated with it, or – even more so –no one's aspiration is to "become a salesperson when they grow up." To understand how and why this negative view of selling came about we need to look at the evolution of modern sales methodologies. We found that most of the effort to formalise the art of selling started in the USA. And that is where we begin our journey.
This journey will also assist the reader to become more discerning about what sales methodologies are really new, revolutionary, or merely an iteration of something that has been done before. It's natural that sales methodologies evolve – new times, new rules, new systems and models require different ways, different skills and even different frameworks; but it's important to be aware that some methods are evolutions of previous models and not shiny new toys that will work miracles. Claims for new and different sales methods are not new. They have also not always resulted in success in selling. That is not to say that new sales methods and techniques aren't relevant or even critically important. They are. It's just that corporations, sales leaders and salespeople themselves, let alone captains of industry, should not allow themselves to get caught up in the hype often generated by pundits promoting their own "new" sales methodologies.
To start, consider what buyers, in the business-to-business environment believe makes for successful selling….
Salespeople must know their clients' businesses so that they can explain how a product or solution will benefit them
Salespeople who think beyond what they are selling, know more than their customers about the products or services they have to offer, or what these can do for their buyers, so they don't waste their customers' time
Salespeople who prove their claims and are not scared to challenge customers who are sceptical
Salespeople who introduce something new, innovative and exciting to their customers. If they can't or don't, they have no reason to be face-to- face with prospects
Salespeople who have significant industry, competitive and product knowledge as well as knowledge of the customer's business –as mentioned above- so that the products, services and solutions they sell can fulfil the buyer's requirements while helping them manage the changeover
Salespeople who are problem solvers, not information providers. Prospects meet a variety of salespeople, every single day. They hear about their products and services and about their competitors. Customers want to deal with professionals who can introduce them to new perspectives
Successful salespeople have learned to develop their imagination. They use this ability to push their customers, ever so gently, towards new ideas, novel solutions and innovative approaches to their business challenges
The salesperson's habit of capitulating on price is largely the product of weak salespeople's sales skills; a lack of commitment and belief in the solutions they are selling. If they don't have the belief how can they expect their customers to believe them.
These eight characteristics, considered to be the cornerstone of what represents successful salesmanship, were originally published in a work by Harry R. Tosdal in his Harvard published paper "Problems in Sales Management" (1921).
As the USA opened its western frontier and people migrated from the relative civilisation of the east coast (New York, Boston, Carolina etc.), they lost access to medicine, fashion, news and many other luxuries. With that, commercial travellers appeared, travelling from town to town peddling and selling their goods – usually off the back of a horse-drawn wagon.
These "salesmen" were without any controls. Customers, at the time, had almost no way of verifying their claims and were left unprotected against what turned out to be a range of charlatans. These salespeople were able to make outlandish claims for their miraculous potions that were very often more hyperbole than reality. It wasn't, for example, rare to find a peddler offering the same magic potion that would stop hair from falling out, remove pimples, grow biceps, stop in-grown toenails and even cure colic in babies.
Snake Oil Selling (our terminology) was a method of selling that existed at the time and continued until around the late 1900s. Snake Oil Selling is the method of making exaggerated claims about the benefits of a product, in a convincing way. These peddlers developed a glib presentation. They often used pseudo-sophisticated terminology to confuse their customers and employed "shills" – people in a crowd who were apparently former, satisfied customers who would support the claims made by these Snake Oil salesmen.
Not only did this sales method cheat people out of their hard earned income, it did much to damage the reputation of salespeople who were viewed with a great deal of scepticism, as liars, exaggerators and people who had little care for their customers.
Against this background John H. Patterson – president of National Cash Register (NCR – 1886) – developed his own sales method known then as Pyramid Selling. Patterson is credited with being the first person to attempt to professionalise salesmanship.
Pyramid Selling was used by the NCR global sales force. The method called on salespeople to sell a cash register to the most influential businessman in a town. These influential people were then encouraged (and often paid in the form of a discount on their own cash register purchase) to arrange demonstrations of the new equipment (the cash register) to other businesses in the region.
This was an attempt to professionalise the Pyramid Selling method and create an image that NCR employed business executives who were able to solve problems. This is the first time we start hearing about solving problems for clients, and it's the first iteration of Solution Selling, which will come up later in this paper. At the time, NCR salespeople were required to dress like important business executives; to wear white shirts, suits and collars. They were given training in various aspects of accounting so that they could, "at the very least, hold a technical conversation with customers…" These salespeople were taught techniques such as handing the prospect a pen to sign the order and then asking questions such as: "Do you want delivery this week or next?"
Patterson's sales process, methods and training made NCR one of the very first organisations to establish a global sales force, with Australia following shortly after he had expanded to England and South Africa. His influence on professional selling continues even today in the heritage of one of his former (and most successful) sales managers – Thomas J. Watson. Not only did Watson adopt these sales methods, he even used three letters (as did NCR) to name his company – International Business Machines (IBM). Even the successful sales promotion campaign run by IBM in the 1980s was adapted from NCR who had an internal sales magazine titled "Think".
IBM's sales method and philosophy, which continued through the late 1980s, was that its salespeople always wore suits, blue collared shirts and ties. They were always well trained and well-spoken and they almost always sold exclusively at an executive level. In every instance the role of an IBM sales executive was to introduce new and innovative solutions at boardroom level. In general, the IBM sales executive was not a technical expert, but rather a business executive who understood how technology could be used to solve complex business challenges. This sales method, originally developed in the 1880s, has been perfected over the following 120 years.
Next week, we'll look at the sales methodologies at the beginning of the 20th century.
This series is part of our whitepaper "The History of Sales Methodologies".