Integrated Marketing Communication: Personal Selling and Direct Marketing Chapter 13

Road Map: Previewing the Concepts Discuss the role of a company’s salespeople in creating value for customers and building customer relationships.Discuss the role of a company’s salespeople in creating value for customers and building customer relationships. Identify and explain the six major sales force management steps.Identify and explain the six major sales force management steps. Discuss the personal selling process, distinguishing between transaction- oriented marketing and relationship marketing.Discuss the personal selling process, distinguishing between transaction- oriented marketing and relationship marketing.

Define direct marketing and discuss its benefits to customers and companies.Define direct marketing and discuss its benefits to customers and companies. Identify and discuss the major forms of direct marketing.Identify and discuss the major forms of direct marketing. Road Map: Previewing the Concepts

The Nature of Personal Selling Most salespeople are well-educated, well-trained professionals who work to build and maintain long-term customer relationships.Most salespeople are well-educated, well-trained professionals who work to build and maintain long-term customer relationships. The term salesperson covers a wide range of positions:The term salesperson covers a wide range of positions:  Order taker: Department store clerk  Order getter: Creative selling in different environments

The Role of the Sales Force Personal selling is a paid, personal form of promotion.Personal selling is a paid, personal form of promotion. Involves two-way personal communication between salespeople and individual customers.Involves two-way personal communication between salespeople and individual customers. Salespeople:Salespeople:  Probe customers to learn about problems  Adjust marketing offers to fit special needs  Negotiate terms of sales  Build long-term personal relationships

The Role of the Sales Force Sales Force serves as critical link between company and its customers.   They represent the company to the customers   They represent the customers to the company   Goal = customer satisfaction and company profit

Sale Force Structure Territorial: Salesperson assigned to exclusive area and sells full line of products. Product: Sales force sells only certain product lines. Customer: Sales force organizes along customer or industry lines. Complex: Combination of several types of structures.

Inside Sales Force Conduct business from their offices via telephone or visits from perspective buyers.Conduct business from their offices via telephone or visits from perspective buyers. Includes:Includes:  Technical support people  Sales assistants  Telemarketers

Selling Team Used to service large, complex accounts.Used to service large, complex accounts. Can include experts from different areas of selling firm.Can include experts from different areas of selling firm. Pitfalls:Pitfalls:  Can confuse or overwhelm customers  Some people have trouble working in teams  Hard to evaluate individual contributions

Recruiting and Selecting Salespeople Key talents of salespeople:Key talents of salespeople:  Intrinsic motivation  Disciplined work style  Ability to close a sale  Ability to build relationships with customers

Recruiting Salespeople Recommendation s from current sales forceRecommendation s from current sales force Employment agenciesEmployment agencies Classified adsClassified ads Web searchesWeb searches College studentsCollege students Recruit from other companiesRecruit from other companies

Sales Force Training Goals Learn about and identify with the company. Learn about the company’s products. Learn customers’ and competitors’ characteristics. Learn how to make effective presentations. Learn field procedures and responsibilities.

Compensating Salespeople Fixed amount:Fixed amount:  Salary Variable amount:Variable amount:  Commissions or bonuses Expenses:Expenses:  Repays for job-related expenditures Fringe benefits:Fringe benefits:  Vacations, sick leave, pension, etc.

Supervising Salespeople Directing SalespeopleDirecting Salespeople  Help them identify customers and set call norms.  Specify time to be spent prospecting  Annual call plan  Time-and-duty analysis  Sales force automation systems

Supervising Salespeople Motivating SalespeopleMotivating Salespeople  Organizational climate  Sales quotas  Positive incentives:  Sales meetings  Sales contests  Recognition and honors  Cash awards, trips, profit sharing

The Personal Selling Process Prospecting: The salesperson identifies qualified potential customers. Preapproach: The salesperson learns as much as possible about a prospective customer before making a sales call. Approach: The salesperson meets the customer for the first time. Presentation: The salesperson tells the “product story” to the buyer, highlighting customer benefits.

The Personal Selling Process Handling Objections: The salesperson seeks out, clarifies, and overcomes customer objections to buying. Closing: The salesperson asks the customer for an order. Follow-up: The salesperson follows up after the sale to ensure customer satisfaction and repeat business.

Direct Marketing Direct marketing consists of direct connections with carefully targeted individual consumers to both obtain an immediate response and cultivate lasting customer relationships.Direct marketing consists of direct connections with carefully targeted individual consumers to both obtain an immediate response and cultivate lasting customer relationships.

The New Direct-Marketing Model Some firms use direct marketing as a supplemental medium.Some firms use direct marketing as a supplemental medium. For many companies, direct marketing constitutes a new and complete model for doing business.For many companies, direct marketing constitutes a new and complete model for doing business. Some firms employ the direct model as their only approach.Some firms employ the direct model as their only approach. Some see this as the new marketing model of the next millennium.Some see this as the new marketing model of the next millennium.

Benefits of Direct Marketing Benefits to Buyers:Benefits to Buyers:  Convenient  Easy to use  Private  Ready access to products and information  Immediate and interactive

Benefits of Direct Marketing Benefits to Sellers:Benefits to Sellers:  Powerful tool for building customer relationships  Can target small groups or individuals  Can tailor offers to individual needs  Can be timed to reach prospects at just the right moment  Gives access to buyers they could not reach through other channels  Offers a low-cost, efficient way to reach markets

Customer Databases An organized collection of comprehensive data about individual customers or prospects, including geographic, demographic, psychographic, and behavioral data.An organized collection of comprehensive data about individual customers or prospects, including geographic, demographic, psychographic, and behavioral data.

Telemarketing Accounts for more than 36% of all direct-marketing sales.Accounts for more than 36% of all direct-marketing sales. Used in both consumer and B2B markets.Used in both consumer and B2B markets. Can be outbound or inbound calls.Can be outbound or inbound calls.

Direct-Mail Marketing Involves sending an offer, announcement, reminder, or other item to a person at a particular address.Involves sending an offer, announcement, reminder, or other item to a person at a particular address. Accounts for more than 31% of direct-marketing sales.Accounts for more than 31% of direct-marketing sales. Permits high target-market selectivity.Permits high target-market selectivity. Personal and flexible.Personal and flexible. Easy to measure results.Easy to measure results.

Catalog Marketing With the Internet, more and more catalogs going electronic.With the Internet, more and more catalogs going electronic. Print catalogs still the primary medium.Print catalogs still the primary medium. Expected sales in 2008 = $176 billion.Expected sales in 2008 = $176 billion. Harder to attract new customers with Internet catalogs.Harder to attract new customers with Internet catalogs.

Direct Response TV Marketing Direct-response advertisingDirect-response advertising InfomercialsInfomercials Home shopping channelsHome shopping channels

Kiosk Marketing Information and ordering machines generally found in stores, airports, and other locations.Information and ordering machines generally found in stores, airports, and other locations.

Public Policy and Ethical Issues in Direct Marketing Irritation to Consumers Taking unfair advantage of impulsive or less sophisticated buyers Targeting TV-addicted shoppers Deception, Fraud Invasion of Privacy

Rest Stop: Reviewing the Concepts 1.Discuss the role of a company’s salespeople in creating value for customers and building customer relationships. 2.Identify and explain the six major sales force management steps. 3.Discuss the personal selling process, distinguishing between transaction-oriented marketing and relationship marketing.

Rest Stop: Reviewing the Concepts 4.Define direct marketing and discuss its benefits to customers and companies. 5.Identify and discuss the major forms of direct marketing.