The business world divides salespeople into hunters and farmers. Hunters generate sales by prospecting for new business; farmers generate sales by maintaining and enhancing existing customer relationships.
A new study by Thomas DeCarlo, Ph.D., professor and interim chair of the Department of Marketing, Industrial Distribution and Economics in the University of Alabama at Birmingham Collat School of Business, breaks new ground on ways to identify effective hunters and farmers in the sales force, and it also may point the way to better bottom lines for businesses. DeCarlo has demonstrated a 3 percent improvement in company sales profitability for salespeople who are "ambidextrous" -- that is, high in both hunting and farming orientations.
While the paper has deep theoretical foundations, DeCarlo also offers practical advice for sales managers about their sales forces.
"For the existing sales force, you need to identify the differences between the two types, so you can coach them up," said DeCarlo, who also holds the Ben S. Weil Endowed Chair of Industrial Distribution at the Collat School of Business. "For potential hires, the No. 1 concern of companies is finding good talent." DeCarlo has identified a tool from social psychology called regulatory focus that will identify whether a potential hire will lean toward hunting or farming.
"Everybody talks about it in business, but we found there's no research on what makes a hunter or a farmer," said DeCarlo. "Are they different? And if they are different, how do they affect the profitability of a company? We think we are onto something."
DeCarlo and his collaborator in the multiyear study, Son Lam, Ph.D., at the University of Georgia Terry College of Business, will publish their study in the Journal of the Academy of Marketing Science (already available online). The study also has been accepted as a working paper by the Marketing Science Institute, a learning organization dedicated to bridging the gap between marketing science theory and business practice. The institute has more than 70 member companies, most of them large-cap firms in areas such as finance, computing, pharmaceuticals, manufacturing, beverages and food, media, banking, and retail.
In their research, DeCarlo and Lam first did in-depth interviews with seven sales and human resource managers from different business-to-business (B2B) companies across the United States. The managers -- who all had more than 10 years of experience recruiting and hiring salespeople -- talked about personality traits of salespeople that are related to hunting for new customers or farming existing customers.
For hunters, the traits included "goes out of his way to get new business," "the first thing they think about every day is 'kill or be killed,'" and "they live for the moment and then move on to the next target."
For farmers, the traits included "laid-back personality … works better with a routinized customer assignment," "tend to be more analytical and amiable," and "they focus on doing the right thing with the customer instead of 'I sold something.'"
A key finding, Lam and DeCarlo said, was that "in personal selling, hunters and farmers possess distinct trait-like individual motivations toward hunting and/or farming activities." Second, the motivational traits that predict hunting or farming orientation appear to correspond, respectively, with either a promotion focus or a prevention focus, which are part of a social psychology theory called regulatory focus.
"If you are a promotion-focused person, you value gains much more than losses," DeCarlo said. "If you are prevention-focused, you are more likely to say, 'I want to maintain what I have, I don't want losses.' You tend to follow the rules and maintain customer relationships."
DeCarlo and Lam wanted to see whether accepted survey questions that identify a prevention or promotion focus would correlate with their newly developed scale to identify hunters or farmers. With the help of a large B2B firm that has more than 1,200 sites nationwide, DeCarlo and Lam invited 1,174 of the firm's salespeople from the Southeast, Midwest and Southwest to participate in an online study by answering a number of survey questions. From the final sample of 357 salespeople, DeCarlo and Lam found a strong correlation between a promotion focus and hunter traits, and a prevention focus and farming traits.
"It was amazing how hunting versus farming traits tracked onto regulatory focus," DeCarlo said. This suggests that sales managers can use a regulatory focus questionnaire to tell whether a prospective hire will have hunting traits or farming traits.
The B2B firm also provided DeCarlo and Lam with six-month average profit margins for each salesperson. Those revealed that "ambidextrous" salespeople who pursue both hunting and farming orientations are more efficient and have higher profit margins.
Finally, DeCarlo and Lam examined external forces of expected hunting success and compensation plans that emphasize customer acquisition as ways to shape a salesperson's behavior, particularly to increase the hunting orientation of prevention-based (farming) salespeople.
When he gives talks about this research, DeCarlo said, "people really light up," though he does caution that this is just one company in one industry, so he does not know how widely applicable the findings will be.
DeCarlo and Lam are now working with the same B2B firm -- and potentially with thousands of its salespeople -- to measure the effects of different types of training to help salespeople become ambidextrous.
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