Commercial management: what is it and why is it important for the company?

The sales department is one of the most important sectors in any company; hence, commercial management plays a fundamental role in developing and consolidating any company.

Think of it this way: the best and newest products and services mean nothing without an eager force to take those to market and expand your business.

In other words, it will be capable of doing so only assuming it will be able to retain its clientele, which without qualified sales will also be pretty challenging. Otherwise, the losses may turn out to be irreversible.

However, it is not enough to just sell.

It is necessary to build a sales process that is consistent with customer behavior, know how to identify business opportunities, map the consumer purchasing journey, understand the market in which you operate and analyze sales performance.

In other words, it is necessary to carry out commercial management of the company .

This is the only way to build a thriving and competitive sales sector.

Continue reading the article to learn more about what commercial management is and why your business needs it!

What is commercial management?

Sales management is a set of actions that aim to analyze and improve professionals, technologies and processes related to sales activities. The goal is to manage results to build a sales department capable of establishing deep connections with customers, attracting new ones, and expanding business.

To this end, commercial management encompasses several tasks, such as:

• definition of sales targets;
• market analysis;
• management and hiring of salespeople;
• customer segmentation;
• implementation of technologies such as the CRM system ;
• structuring and monitoring the sales funnel;
• relationship management.

Thus, commercial management allows the sales force to identify the best sales opportunities, convert and retain customers and promote a satisfactory purchasing experience.

Is it clear what commercial management is?

As you have seen, it is completely linked to the sales operation, and for this reason, it must be supported by specific pillars to ensure the achievement of its objective.

Let's understand more deeply in the next topic.

What is the relationship between commercial and business management?

Commercial and business management are directly linked, however, they do not refer to management processes.

While commercial management is focused on the organization's business, business management has a broader scope, covering all areas of the company , such as HR, finance, production, marketing, logistics , IT, purchasing, in addition to sales.

In other words, business management involves the general administration of the company, aiming, above all, at growth, profitability and operational efficiency.

Thus, we can state that the difference between commercial management and business management lies in the main focus of management actions, and that the former is part of the latter, but the latter is a global action of the organization.

The pillars of commercial management and sales

The pillars of commercial management and sales are:

• Strategy;
  
• People;
• Processes;
• Data;
• Technology.

Find out what each of these pillars includes.

Strategy

Strategy is the main pillar that supports commercial management , and must be fully connected with the objective defined in the organization's  strategic planning .

For example, if the company wants to expand its market share by 25% in a given period of time, commercial management helps to transform this objective into reality.

In practice, this involves formulating sales tactics and techniques, as well as constantly analyzing key performance indicators and setting measurable goals to track progress toward the defined objective.

People

A sales team is responsible for getting their hands dirty and making the magic happen. Therefore, people management is a vital component of sales and commercial management .

And to get the best performance from your team, you need to:

• recruit and select the right people;
• provide ongoing training;
• set clear and realistic goals;
• invest in incentives and recognition;
• provide constructive feedback;
• evaluate salespeople’s performance;
• motivate and engage sales professionals.

Processes

Defining the steps your customers go through is essential for the sales process to be scalable.

This will give salespeople the knowledge they need to conduct their negotiations and, for the sales manager, this will be their generator of indicators and metrics.

The sales funnel , a tool that reflects the commercial process by separating it into stages, will provide indicators such as:

• conversion rate;
• average sales cycle;
• closing rate;
• origin of qualified sales opportunities;
• rate of return.
• Data

Against data, there are no arguments, do you agree?

In commercial management, this would be no different.

Data is a company's source of knowledge, whether it is about customers, the market, competition, organizational processes, or employee performance.

All this information provides a basis for decision-making.

Of course, you need to have a good structure to be able to capture, store and maintain so much data. That is why a CRM system, in the case of commercial management, is so essential.

Technology

Digital transformation has arrived and has redefined the routine of a company. As a result, the pillars mentioned above can now be unified in a single tool, significantly simplifying the lives of salespeople and sales managers.

In this context, there is a leading allied platform: the CRM system.

CRM, which was once a differentiator between companies, is a necessity, being a fundamental part of an organization's commercial structure.

In this system, the following will be centralized:

• customer data;
• the sales history;
• ongoing negotiations;
• commercial results;
• the main KPIs and sales metrics;
• the commercial process (sales funnel);
• the salespeople's appointment schedule.

This means that everyone involved in commercial management benefits.

In addition to facilitating collaboration, CRM is also crucial for automating repetitive tasks, making data-driven decisions, and personalizing sales messages.

But in addition to CRM, other technologies are important for management, such as marketing automation platforms, business intelligence and communication tools.