Managing Personal Communications: Direct and Interactive Marketing, Word of Mouth, and Personal Selling Marketing Management, 13 th ed 19

Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall 19-2 Chapter Questions How can companies integrate direct marketing for competitive advantage? How can companies do effective interactive marketing? How can marketers best take advantage of the power of word of mouth? What decisions do companies face in designing and managing a sales force? How can salespeople improve selling, negotiating, and relationship marketing skills?

Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall 19-3 Direct Marketing Use of consumer-direct channels to reach and deliver goods and services to customers without using market middlemen.

Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall 19-4 Direct Marketing Channels Catalogs Direct mail Telemarketing Web sites marketing Mobile devices Interactive TV

19-5 Constructing a Direct-Mail Campaign Establish objectives A.to receive an order from prospects (response rate-2% normally), B.to produce prospect leads, C.to strengthen customer relationships, D.to inform and educate customers, E.to remind customers of offers, F.to reinforce recent customer purchase decisions Select target prospects A. recency—30 to 60 days B. frequency C. monetary amount Develop offer elements Test elements A. products B. product features C. copy platform D. mailer type E. prices F. mailing lists Execute Measure success—campaign costs minus revenue

Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall 19-6 RFM Formula for Selecting Prospects Recency—last order Frequency—number of times purchased Monetary value-- money spent since becoming a customer

Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall 19-7 Elements of the Offer Strategy Product Offer Medium Distribution method Creative strategy

Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall 19-8 Components of the Mailing Outside envelope Illustration (color) Sales letter Personal, quality paper, bold type Circular colorful Reply form Toll-free number, website Reply envelope Postage-free

Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall 19-9 Types of Telemarketing Telesales Taking orders from catalogs or ads and outbound calls Telecoverage Call customers to maintain and nurture key account relationships and neglected accounts Teleprospecting Generating and qualifying new leads for closure by another sales channel Customer service and technical support Answering service and technical questions

Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Other Media for Direct Response Television Direct Response Advertising Infomercials At-home shopping channels TV channels dedicated to selling goods Videotext Consumer’s TV set linked with seller’s catalog by cable or telephone line Kiosks Small building or structure to sell or provide information

Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Public Issues in Direct Marketing Irritation--timing Unfairness- impulsive or less sophisticated buyers Deception/fraud- mislead buyers Invasion of privacy- names included on several databases

Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Interactive Marketing Tailored messages possible Easy to track responsiveness Contextual ad placement possible Search engine advertising possible Subject to click fraud Consumers develop selective attention

Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall e-Marketing Guidelines Give the customer a reason to respond Personalize the content of your s Offer something the customer could not get via direct mail Make it easy for customers to unsubscribe

Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Online Ads Banner ads--small, rectangular boxes containing text and maybe a picture Microsites--limited area on web (e.g., insurance on an used car website) Sponsorships--pays for showing content and is acknowledged Interstitials--ads that pop-up between changes on website Search-related ads--search terms that charge for cost per click Content-targeted advertising-- links ad to content of webpage Alliances--advertising each other on their respective website Affiliate programs--post ads on affiliate websites

Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Ease of Use and Attractiveness Ease of Use Downloads quickly First page is easy to understand Easy to navigate Attractiveness Clean looking Not overly crammed with content Readable fonts Good use of color and sound

Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Designing an Attractive Web Site Context -- Layout & design Content--Text, picture, sound, video Community--user-to-user communication Customization—tailor to user or allow personalization Communication—enables site-to-user, user-to-site, or two-way communication Connection—ability to link to other sites Commerce—ability to enable commercial transactions

Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall iTunes Affiliate Program

Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Increasing Visits and Site Stickiness In-dept information with links Changing news of interest Changing offers Contests and sweepstakes Humor and jokes Games

Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall How to Start Buzz Identify influential individuals and companies and devote extra effort to them Supply key people with product samples Work through community influentials Develop word-of-mouth referral channels to build business Provide compelling information that customers want to pass along

Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Salespeople represent whole company Sales force provides market information Salespeople represent whole company Helping to buy is good selling Requires strategy decisions Requires strategy decisions Requires strategy decisions Requires strategy decisions Helping to buy is good selling The Importance and Role of Personal Selling Salespeople can be strategy planners Personal Selling Is Important Personal Selling Is Important

Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall What Kinds of Personal Selling Are Needed? Order- Taking Order- Getting Supporting Basic Sales Tasks Basic Sales Tasks

Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Wholesalers’ Order Getters Work Closely with Retailers Producers’ Order Getters Find New Opportunities Order Getters and Order-Getting Retail Order Getters Influence Buyer Behavior Order Getters Develop New Business Relationships

Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Wholesalers’ Order Takers Don’t Get Orders But Keep Them Producers’ Order Takers Train, Explain & Collaborate Order Takers and Order-Taking Retail Order Takers Are Often Poor Sales Clerks Order Takers Nurture Relationships to Keep the Business Coming

Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Technical Specialists (technical assistance) Technical Specialists (technical assistance) Missionary Salespeople Missionary Salespeople (good will and educate) Customer Service Reps ( resolve problems with a purchase) Customer Service Reps ( resolve problems with a purchase) Supporting Sales Tasks Supporting Sales Force Informs and Promotes in the Channel

Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Solves problems after a purchase Technical Specialists Part of promotion Reps are customer advocates What is Customer Service? What is Customer Service? Customer Service Promotes the Next Purchase

Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Sales Territories Telemarketing Major Accounts Sales Force Different Markets, Different Tasks Team Selling Sales Force Size and Workload The Right Structure Helps Assign Responsibility

Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Key Steps in the Personal Selling Process

Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Straight Commission Straight Salary Level of Compensation Method of Payment Level of Compensation Method of Payment Combination Plan Compensating and Motivating Salespeople

Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Flexibility vs. Simplicity

Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Study Question 1 Direct marketing channels include direct mail, catalogs, Web sites, interactive TV, and ____________ A.Telemarketing B.Billboards C.Coupons D.Bounce-back coupons E.None of the above

Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Study Question 2 In constructing an effective direct-mail campaign, marketers must decide on their objectives, target markets, and prospects; offer elements; means of testing the campaign; and _________ A.Sales promotions B.Advertising campaign C.Salespeople’s input D.Measures of campaign success E.Management’s input

Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Study Question 3 A direct-mail campaign that has an order-response rate of ________ is considered a success. A.10% B.3% C.15% D.2% E.5%

Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Study Question 4 Direct marketers use a number of channels to reach prospects, including ___________ A.Direct mail B.Catalog marketing C.Telemarketing D.Kiosk marketing E.All of the above

Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Study Question 5 Direct marketing permits the ________ of alternative media and messages in search of the most cost-effective approach. A.Testing B.Use C.Implementation D.Outsourcing E.Accent