Fixing Bad Marriages – When Should Firms Reassign Sales Reps?
56 Pages Posted: 13 May 2023
Date Written: May 11, 2023
Most B2B buyer-seller relationships involve a connection between a sales rep and a customer. If the relationship is suboptimal, the selling firm can move customers from one sales rep to another, a process we call proactive reassignment. Historically, geographic considerations severely constrained feasible reassignments. Technological advancements have made virtual connections between a customer and a rep the norm, removing geographic constraints on proactive reassignment. Using data from a quasi-field experiment in a partner seller firm and machine learning methodology, we develop a decision support system (DSS) to guide sales managers in revenue-enhancing customer-rep reassignments. We find that reassigning a customer to a long-standing rep does not significantly affect post-period sales, but reassigning to a new rep typically leads to a decline in sales. Significantly, our methodology identifies situations when proactive replacement, even with new reps, can be beneficial. For instance, customers with past relationship disruptions perform better when reassigned to new reps than to other, existing reps. Integrating these findings into the DSS, we identify numerous situations where future proactive reassignments can increase the focal firm’s revenue. Our counterfactual analysis shows a potential 14% improvement in post-period revenue compared to the selling firm's actual actions.
Keywords: Rep Reassignment, Relationship Marketing, Business-to-Business Marketing, Machine Learning, DSS
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