Why Salespeople Avoid Big-Whale Sales Opportunities

Juan Xu, Michel Van der Borgh, Edwin J. Nijssen, Son K. Lam

Research output: Contribution to journalJournal articleResearchpeer-review

Abstract

Contrary to the intuition that salespeople gravitate toward big-whale sales opportunities, in reality they often avoid them. To study this phenomenon, the authors integrate contingent decision-making and conservation-of-resources theories to develop and test a framework of salespeople's decision making when prospecting. Study 1 reveals that the performance impact of salesperson initial judgment of opportunity magnitude follows an inverted U shape, indicating that salespeople's avoidance of large opportunities results from rational benefit–cost analyses due to their conservation of resources. Interestingly, salespeople use a calibration decision-making strategy (i.e., calculating expected benefits by accounting for conversion uncertainty) at the portfolio rather than prospect level, in solution- but not product-selling contexts. Ignoring this calibration effect can lead to under- or overestimation of conversion rates of up to 100%. Study 2 shows that salespeople's past performance success and experience bias this calibration. Simulations reveal that when high performers or inexperienced salespeople believe their portfolio magnitude is large and conversion uncertainty low, they are less concerned about resource conservation and improve their quota attainment by 50%. Study 3 confirms the theoretical mechanism. These findings shed new lights on salespeople's decision making and suggest ways for sales professionals to improve effectiveness when prospecting.
Original languageEnglish
JournalJournal of Marketing
Number of pages69
ISSN0022-2429
DOIs
Publication statusPublished - 21 Jul 2021

Bibliographical note

Epub ahead of print. Published online: 21. July 2021

Keywords

  • Salesperson judgment
  • Uncertainty
  • Solution selling
  • Prospecting
  • Conservation-of-resources theory

Cite this