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Market-Based Solutions to Vital Economic Issues
Research
Jun 21, 2020

Value of Inside Sales Reps in the Presence of Outside Sales Rep in Business-to-Business Selling

Abstract

Many business-to-business (B2B) selling situations involve outside sales (OS) representatives (reps) interfacing with customers and inside sales (IS) rep largely supporting OS reps. Put differently, OS reps are linchpins, while IS reps generally have auxiliary roles. Perhaps for this reason, the economic value of IS reps for the B2B IS-OS selling process has received little systematic investigation. The authors propose an approach that quantifies the incremental value of IS using observational data that are commonly available in organizational customer relationship management systems. By leveraging observed hierarchies in customer–IS–OS relationships, the authors establish an identification strategy that reliably quantifies the incremental effects of IS reps for generating customer sales. In the application of the proposed approach to field data, they use cross-customer variation to estimate the sales effects of IS reps and exploit the heterogeneity within IS rep collaborations to estimate the sales effects of IS–OS dyadic characteristics. The incremental financial impact of an IS rep for each customer ranges from $1,100 loss to $2,800 gain relative to every $10,000 customer sales.

Note: Research papers posted on SSRN, including any findings, may differ from the final version chosen for publication in academic journals.


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