We have all been accustomed to sales being an integral part of our lives for a long time. Wherever you go, they are there: in the store, in the cinema, and on the Internet.
The world is always trying to sell you something, if not material things, then impressions. But who even came up with the idea to sell something to someone? How did sales appear, and how have they changed over time? In this article, you will learn about the evolution of sales — from the moment of their appearance to the emergence of the most advanced techniques that managers use today.
What did the very first sales look like
As you probably know, there was no money initially, and people were living off barter. They procured and made items necessary for life, such as tools or warm clothes for the winter. But, of course, one person, or even a group of people, could not foresee everything in the world and make everything they needed on their own. And so, the idea of exchange arose: one person gave an extra pair of tools, in the creation of which he succeeded, and the other gave the skin, in the extraction of which he was second to none.
However, over time, the settlements of people began to grow, and at the same time, not only the infrastructure but also the society started to become more complicated. As new materials and extraction methods were discovered, new occupations and specializations emerged. The barter system lost its effectiveness since it was impossible to fairly measure the value of goods by comparing them with other things. For example, how should one pay for calfskin boots with corn cobs? In addition, with the emergence of large cities, people began to think about establishing trade relations between them. Transporting vast grain stocks back and forth to pay them is much more complicated than carrying a purse with small coins. This is how the first money appeared — a universal way to measure the value of things.
At the same time, the first retail outlets — markets, began to appear. Whereas in the past, sales were made directly in artisans' houses, where people came to get what they needed, now, all merchants gathered in one square for convenience and speed of service (the population was also growing rapidly). Such open-air markets can be considered the forbears of modern marketplaces.
An interesting fact is that King Alyattes of Lydia struck the first coins in human history in 640 B.C., and the first paper money appeared in China in the VII century. However, it was not until a thousand years later that the latter came into common use worldwide.
The appearance of the first "salesmen (1870)
In 1752, the U.S. founding father Benjamin Franklin and the Firemen's Union founded America's first insurance company that offered Americans fire insurance. After a while, the company expanded the scope of its services and also began offering annuities, life insurance and crop insurance. What did it look like in practice? Representatives of the Franklin Insurance Company travelled to cities and towns every month to collect the mandatory insurance premium.
However, they had to expand their clientele and offer insurance to those who had not yet used it. To solve the time shortage problem, the company's representatives were divided into two categories: the so-called "farmers", who collected insurance premiums, and "hunters", who were engaged in finding new customers and thereby became the first sales managers in history.
Such structure demonstrated unprecedented efficiency and quickly gained popularity in other industries, where also special "groups" were created for sales and expansion of customer base. Years later, it was taught as a separate specialization, so a new profession emerged.
The first sales (the beginning of the XIX century)
The pioneer of sales is considered to be Frank Woolworth, the American entrepreneur and creator of the first Woolworth retail chain in the United States, which exists to this day. Once Woolworth was an ordinary assistant salesman in a small rural shop. However, shy Frank did not do his job well: he had difficulty convincing customers to buy, bargain, etc. Woolworth was easily persuaded to sell the goods at a lower price when asked.
After the shopkeeper got wind of this and decided to fire Woolworth, Frank, in a fit of despair, dumped all the seasonal goods on the counter and placed the sign, «”All at 5 cents”». As a result, all the goods were gone in just a few hours, and so the ideal sales formula was revealed: people buy almost anything if it's at a 50% discount.
IBM and Professional Sales (1924)
From 1849 to 1882, about 180,000 Chinese residents emigrated to the United States. They brought snake oil with them, which allegedly had healing properties and was actively promoted by the Chinese in all quarters and retail outlets. Due to their obtrusiveness and lack of tact, Americans soon began to associate the salesman's profession with an unethical and poorly educated person, which hit both this profession (which is still in its formation stage) and other companies hard.
Thomas Watson, one of the founders of IBM, famous for the production and supply of IT equipment, decided to modernize the company's sales system to restore its managers' reputation. During market research and experiments, he concluded that the higher the competition in the market, the more critical the professionalism of salespeople is — in this case, it becomes a competitive advantage for the company.
During the modernization of the sales department, Watson developed several training programmes for his salespeople, during which they were able to develop relevant skills and sales techniques in practice. Watson also introduced a tangible and intangible incentive system for IBM managers and began hiring the best graduates of local colleges. Such tactics rehabilitated the seller's status in the United States and increased this profession's respectability.
Learning by topic
Incredible Seller. How To Sell Anything to Anyone
Successful salesmen principles, client types and communication techniques, question types and handling objections
Gaining Customer Trust. Online and Offline Sales
Ways of identifying needs and client motivation, behavioral triggers and lead magnets, digital transformation
The Psychology of Sales by Dale Carnegie (1925-1935)
In 1925, the American psychologist Edward Strong published "The psychology of selling and advertising". He analyzed the types of questions, sales principles, and various ways of working out client objections. Together with the success of Watson's IBM, this book attracted unprecedented interest in the field of sales from entrepreneurs and other scientists. The most prominent of the latter was Dale Carnegie, a well-known business and motivational coach.
It was Carnegie who developed the AIDCA sales formula, which is used today and spawned its simplified version — AIDA. The classic sales formula includes five steps that a manager must take with a client to make a deal:
- A (attention);
- I (interest);
- D (desire);
- C (confidence);
- A (action) — action and conclusion of the transaction.
SPIN, predictable approach, and modern sales (1988 — present day)
The emergence of the SPIN Selling concept in 1988 brought sales to a whole new level. The starting point for creating this concept was the hypothesis that the customer is motivated to purchase a product only after he realizes his need for it. Today, SPIN is used mainly for complex and multi-stage sales, for example, the sale of a car, for the purchase of which the client, as a rule, needs not only a lot of money but also a lot of time to think. The essence of SPIN is to first determine the client's needs through open, closed, and other types of questions, and only then formulate a trade offer and present the product with the benefits and advantages that the client needs.
In 2011, Aaron Ross published the book "Predictable Revenue". He came to the conclusion that effective sales are based on three pillars: attracting customers, direct sales and working with the customer base. According to Ross, to work with each of these ‘whales’, it is necessary to have a separate specialist. Therefore, the trade also became more complicated and had additional (related) specializations.
Since 2015, when one of SaaS’s first cloud services was introduced, any company can now get a ready-to-use solution for any business process, sales began to automate, and 70% went online. So, today a good salesperson is both a psychologist, a marketer, and even an SMM manager. Nevertheless, sales remain sales, and anyone can master them, for example, with a course "An ideal sales system" Traditional sales techniques like SPIN or AIDA are relevant to this day but much more effective with the latest technologies and business innovations.