How to Identify and Better Manage Hunters and Farmers in the Sales Force
Thomas E. DeCarlo and Son K. Lam, 2014, 14-122
In business-to-business markets, “hunting” for new customers and “farming” existing customers are critical to achieve sales goals. Although practitioners suggest that salespeople have preferences, academic research has not examined when and why salespeople become oriented toward hunting and farming, and how a simultaneous engagement in both (i.e., being “ambidextrous”) affects customer satisfaction and conversion rates.
In three empirical studies, Thomas DeCarlo and Son Lam examine the antecedents and moderating factors that influence salesperson hunting and farming orientations, and effects of salesperson ambidextrous behavior on individual salesperson-generated profit margins.
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In Study 1, they conduct in-depth interviews with managers in a variety of industries to identify the personality traits that are predictive of salesperson hunting and farming orientations. They identify the link between regulatory focus—promotion or prevention—and salesperson orientation.
In Study 2, they develop two new measurement scales to measure salesperson hunting and farming orientation. With data from a publicly traded industrial distribution firm, they demonstrate that, all else equal, promotion-focused salespeople are more hunting oriented than prevention-focused counterparts, whereas prevention-focused salespeople are more farming oriented than promotion-focused ones. Using corporate data on profit margins, they also showed that ambidextrous salespeople generate higher profits when they are customer oriented.
In Study 3, the authors collect data from salespeople in a variety of firms that utilize a generalist (territory-manager) selling model, which allows salespeople to have total discretion in allocating effort between hunting and farming to achieve sales goals. They find that salesperson expectations about hunting success, and the extent to which compensation plans are based on customer acquisition activities, can change the direction of the relationship between regulatory focus and salesperson hunting and farming orientations.
Their findings offers useful insights for managers seeking to identify, allocate, and balance hunting and farming efforts within the sales force. Managers can alter salesperson orientation by changing salesperson expectations about hunting success or by using compensation plans that are focused on customer acquisition activities.
The study also offers the important insight that customer-oriented salespeople who are ambidextrous will reap higher profit margins than even highly customer-oriented salespeople who emphasize only hunting or farming.
Thomas E. DeCarlo is Professor and Ben S. Weil Endowed Chair of Industrial Distribution, Collat School of Business, University of Alabama, Birmingham. Son K. Lam is Associate Professor of Marketing, Terry College of Business, University of Georgia. Both authors contributed equally to the manuscript.
Interlocking Networks: How and When Do Connections between Buying and Selling Teams Affect Customer Solutions?
Brian R. Murtha, Sundar G. Bharadwaj, and Christophe Van den Bulte (2014) [Report]
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