Covid-19 and the challenge of remote selling

In April 2020, at the height of pandemic, the Commercial Excellence Lab (CEL) at the SDA Bocconi School of Management ran an instant survey showing that the vast majority of sales companies sampled (71.2%) implemented various kinds of restrictions in terms of their customer relationship management policies. In fact, sales calls were cut by 60.1%, and initial expectations were to see an average decrease in turnover of 22.1% - a figure that later rose to 41.1%.

That same survey revealed that 42.2% of customers could not be contacted in person, but only via alternative channels, for example by phone, email, or instant messaging or using more evolved technologies such as web conferencing platforms (Skype, Teams, WebEx, Zoom, etc.). The findings confirmed that use of multiple channels for customer interaction was not an insignificant factor. Indeed, the more channels of contact that salespeople utilized, the better able they were to maintain relationships with their customers and curb the losses in turnover.

But once the initial emergency was over, what did salespeople do, how did they behave? Did they continue to utilize digital web conferencing channels for remote selling or for customer interaction? How? To what extent? Weighing the pros and cons, what’s their opinion of remote selling? Has using digital channels changed the way they interact with their customers? What support have salespeople received from their companies? And what are their expectations and intentions as far as using remote tools and sales channels in the near future?

Based on these questions, CEL at SDA Bocconi conducted a quantitative study from November 2020 to January 2021, in an attempt to pinpoint the various elements that characterized the experiences of salespeople up to this point, and discover the direction of possible future developments.

Our study involved a sample of 1220 participants, two-thirds of whom were salespeople (direct and indirect) and around one-third supervisors and sales managers from the following sectors and industries: B2B and B2C, services, ICT, pharma-healthcare, finance and insurance.

One of the most interesting results from a managerial perspective was that during the Spring 2020 lockdown, 48% of customers were managed remotely, but with wide-ranging intensity. In fact, 36% of the interviewees said they used digital tools with no more than 20% of their customers, while 25% affirmed that they did the same with 80% to 100% of their customer portfolio. The average figure dropped significantly (34%) when the lockdown ended.

Our study also found that the sales network very often enjoyed autonomy in deciding how to manage remote selling with customers (58% of the sample). Generally speaking, this approach required extra effort, especially when preparing to meet with customers. Specifically, sales people had to make greater use of available informational materials, and adopt new materials that were created ad hoc. Compared with the past, on average this method fostered greater involvement and interaction with colleagues from other company functions.

In addition, with regard to managing remote interactions with customers, methods changed as well. Contacts became less frequent and more brief (the duration of interactions decreased by 16.8% on average), and most importantly, more difficult. In fact, on average, all phases of the remote selling process were perceived as more difficult compared to face-to-face approaches, in particular when analyzing customer needs and negotiating.

There are pros and cons to the remote selling experience that salespeople have had so far: two-thirds of the sample saw this method of customer interaction less effective compared to the traditional approach. In contrast, specifically with regard to managing key customers, around 40% of respondents said that compared to the past they preferred remote selling. As far as the customer perspective, according half the interviewees, customers liked remote selling less than face-to-face; but 36% of respondents perceived an equal appreciation among their customers for both approaches.

As for the level of support that companies offered their sales staff, there was widespread satisfaction with regard to the tools that were made available (hardware, software, informational material) and the training that was provided. The later focused on teaching salespeople how to use information technologies, rather than methods for managing remote interaction with customers.

In terms of adapting to the new context, we found less satisfaction with the way work processes were redesigned, and lower still with regard to rethinking performance management processes and systems.

Lastly, our study turned to ascertaining the intentions of the sales network as far as using remote selling in the future. A complex picture emerged from our data: only one-fourth of the sample (24%) said they would very likely use this method when the emergency was over; half (53%) were quite sure they would, and the remaining 23% said that if they had a choice, they would not use remote selling. According to 54.5% of the sample, in fact, the number of customers that they would manage remotely if there were no emergency would not be more than 25%.

Some differences also emerged between industries. As far as finance-insurance and ICT, the likelihood to use remote selling in the future exceeded 40% of customers. At the other end of the spectrum, in healthcare (pharma-medical) salespeople said they would limit remote selling to only 18% of their customers, on average.

The emergency caused by the pandemic served as a powerful impetus in the process of digitalizing sales networks and processes, pushing companies to find alternative ways to manage sales relationships.

The positive relationship between the use of technologies in sales networks and the improvement in company performance was already substantiated in other studies by CEL at SDA Bocconi. The Covid-19 crisis confirmed this equation, accelerating the adoption of these technologies, but the level in this country is still medium to low.

The first steps that companies can take to ensure greater dissemination of these technologies in their sales networks are as follows: 1) segment customers to transition to digital, based on pursing either a pure or hybrid approach (a mix between face-to-face and remote interaction); 2) update sales processes to identify the phases to shore up with an eye to remote selling; 3) continue to invest in support for sales staff, not only in the form of technological tools but in training as well, so they develop a variety of effective communication skills that are consistent with the new channels; 4) redesign performance management processes and systems.