Targeting selling efforts towards profitable customers is widely known to increase sales and allow firms to charge higher prices. In this paper, we show that targeting of selling efforts may also inadvertently lead to sales spilling over to unprofitable customers when they are not identifiable. Such spillover sales are more likely when the ability of the salesperson and the profitability of target customers are above a threshold. We also show that firms can solve this problem by lowering the sales incentives as well as the price to make their offer unattractive to the unprofitable customers, a strategy commonly referred as screening. When the ability and profitability are both very high, however, the firm is better off allowing sales to unprofitable customers because the cost of preventing sales from spilling over is excessive. This is because the reduction in profits from the target customers that results under screening exceeds the loss from allowing sales to unprofitable customers. Such an accommodation strategy becomes more attractive as the fraction of unprofitable customers in the market decreases. Finally, we show that the spillover problem is even more acute when firms can monitor the selling efforts of a salesperson.

中文翻译：

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目标和销售人员补偿：当销售溢出到无利可图的客户时

将销售努力面向有利润的客户是众所周知的，可以增加销售量并允许公司收取更高的价格。在本文中，我们表明，以销售努力为目标可能还会在无法识别出无利可图的客户时无意中导致销售溢出。当销售人员的能力和目标客户的盈利能力超过阈值时，这种溢出销售更有可能发生。我们还表明，企业可以通过降低销售激励措施以及降低价格以使其报价对无利可图的客户没有吸引力的方式来解决此问题，该策略通常称为筛选。但是，当能力和获利能力都很高时，公司最好允许销售给无利可图的客户，因为防止销售溢出的成本过高。这是因为在筛选过程中，目标客户的利润减少量超过了允许销售给无利润客户的损失。随着无利可图的客户在市场中所占比例的减少，这种适应策略变得更具吸引力。最后，我们表明，当企业可以监视销售人员的销售努力时，溢出问题更加严重。