Sales force management strategies among U.S. freight railroads

Abstract

Although the marketing discipline has become a more important functional area in many railroads since passage of the Staggers Act of 1980, much of the formal research has been devoted to pricing issues. Other elements of the marketing mix can impact profitability; consequently, U.S. freight railroads were surveyed about their sales force management practices on such items as recruitment and training. These sales practices, in turn, served as the basis for delineation of distinct sales force strategies being pursued by U.S. railroads. Three strategies—cautiously aggressive, focus, cost-conscious—are identified; the cautiously aggressive railroads utilize both traditional sales tactics (e.g. use of personal interviews) as well as nontraditional practices (e.g. evaluation by profitability analysis). Railroads following the focus strategy employ salespeople more concerned with efficient operations than with extensive selling. Cost-conscious sales strategies are characterized by sales practices that emphasize cost containment, such as internal recruitment.