Are conservative approaches to new product selling a blessing in disguise?

Abstract

A new product's success in the marketplace largely depends on salesforce actions. Many B2B salespeople display conservatism when confronted with new products in their portfolio, such that they maximize their efforts to sell existing products before engaging in efforts to sell the new product. So far, it is unclear whether this conservative selling behavior (CSB) is harmful to new product selling performance, and how this behavior can be managed. Building on perceived risk processing theory, and employing multi-level structural equation modeling on a multi-source dataset, the authors empirically substantiate that salespeople's CSB makes their effort to sell new products more effective. Remarkably, such effort is then valued less by sales managers. The authors also find that CSB is a result of a risk assessment and evaluation process, in which internal marketing efforts (i.e., providing salespeople with information on the new product) determine the weight of perceived performance risk (i.e., new product radicalness), social risk (i.e., managerial new product orientation), and financial risk (i.e., long-term rewards). Managers looking to control the levels of CSB in their salesforce should carefully align their information support activities with the perceived risk dimensions of the new product selling situation.

Steering the Sales Force for New Product Selling: Why Is it Different, and How Can Firms Motivate Different Sales Reps?

“…As previous research has shown, an important step is to establish an industry‐specific definition of “new product” that is meaningful to the survey respondents (Van der Borgh and Schepers, ). This is because product life‐cycle times and sales process durations vary substantially by industry (Nadkarni and Narayanan, ), determining which sales represent novel challenges for sales reps.…”

“…Thus, in a short life‐cycle industry, such as consumer electronics, new product selling may be defined as the sale of products that are younger than six months (Van der Borgh and Schepers, ). In other industries with longer life cycles, such as information and communications technology, a longer time span is necessary for a valid and understandable definition of “new product” (Hultink and Atuahene‐Gima, ; Van der Borgh and Schepers, ).…”

“…To measure financial new product performance , we drew on four items from Song and Parry (), which we adapted to the firm‐specific context. Moreover, in line with Van der Borgh and Schepers (), to measure sales reps’ new product selling effort we adapted several items from Sujan et al ()’s working hard scale to the new product selling context.…”

“…In contrast, we expect that performance predisposition affects intrinsic, internalized, and controlled new product selling motivations. Finally, we expect a positive relationship between reps’ new product selling effort and financial new product performance (Van der Borgh and Schepers, ).…”

“…As this vignette indicates, commercialization of new products is a major success factor for firms but also represents a formidable managerial challenge. Although research provides rich findings regarding product‐, strategy‐, process‐, and market‐related determinants of new product performance, research on sales force‐related factors is relatively scarce (Barczak, Griffin, and Kahn, ; Henard and Szymanski, ; Van der Borgh and Schepers, ).…”