The History of Sales Territories: From Geographic to Target Accounts

The History of Sales Territories: From Geographic to Target Accounts

Sales territories have been an essential aspect of sales organizations for centuries. In this article, we are going to explore the history and evolution of the sales territory.

Traditionally, sales have been conducted through direct selling, where reps personally visit and sell products to customers. This direct sales approach required sales territories to be simple, well-defined geographies that were easy to visualize and navigate. The conventional approach was to give the rep a geographic shape that contained enough business to meet targets without being so large that the time to traverse it eclipsed the time it took to sell.

With the advent of high-speed internet, video conferencing, and remote work, we are seeing a rise to a new type of sales territory, the Target Account approach. This approach comes from the Account Based Marketing business philosophy and focuses on targeting high-value prospect (prospects that most closely match a particular profile) through a prioritized list of accounts. Coupling this approach with modern technology, personalized outreach, and customized marketing engagement allows for modern sales teams to sell across geographical boundaries.

But how has this evolution transpired?

1800s: The concept of sales territories emerged with the door-to-door sales model. One of the most iconic and successful examples comes from the cosmetic company, Avon. Avon grew in popularity as it employed a sales team of women to go door-to-door in the afternoons, selling perfume to the era-specific “housewives.”

Early 1900s: The concept of sales territories became even more popular with the rise of the mass production and the industrial sales model. Sales teams became larger, and territories were divided into smaller, more manageable areas. Companies began to use an early form of data analytics to determine the most effective ways to allocate their sales team, focusing on population density, demographics, and other factors.

1950s-2000s: The sales territory concept expanded significantly with the rise of the professional sales model. Companies began to employ more specialized salespeople, such as those focused on specific industries, products, or customer segments. This required an even more nuanced approach to territory planning. Salespeople of this time were considered to be product experts and sales where conducted largely through interpersonal relationships where trust and rapport were critical.

Today, geographic territories are still widely used, but they have evolved significantly over time. With the rise of digital sales channels and remote work, many sales organizations have moved away from geographic territories and towards a more account-based approach. This approach focuses on individual customer accounts rather than geographic areas, allowing sales teams to work more efficiently and effectively across the globe. However, there are still many products and services that require face-to-face selling, such as complex products, industrial equipment, and luxury items. In these cases, geographic territories are still essential to ensure that sales reps can develop relationships with customers in their assigned regions and meet with them in person.

The concept of sales territories has been around for a long time and has evolved significantly over the years. Today, the most successful sales organizations use a combination of geographic and account-based approaches to maximize sales effectiveness. By leveraging data and analytics, sales teams can create intelligent and equitable territories that enable them to build strong relationships with customers and close more deals.

For more information, check out these resources:

  1. "The History of Sales Territory Management" by ZoomInfo: ****
  2. "Why Territory Management is So Important for Your Business" by Salesforce: ****
  3. "The Evolution of the Sales Process: From Cave Men to Modern Sales Teams" by SalesHacker: ****
  4. "The Rise of Revenue Operations: A New Paradigm for Sales" by Forbes: ****

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