1. Personal Selling and Sales Promotion
Chapter

2. Chapter Outline The Nature of Personal Selling
The Role of the Sales Force
Managing the Sales Force
The Personal Selling Process
Sales Promotion
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3. Previewing the Concepts
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.
Discuss the personal selling process, distinguishing between transaction-oriented marketing and relationship marketing.
Explain how sales promotion campaigns are developed and implemented.
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4. Personal Selling
Personal presentation by the firm’s sales force for the purpose of making sales and building customer relationships.
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5. The Nature of Personal Selling
Most salespeople are well-educated, well-trained professionals who work to build and maintain long-term customer relationships.
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6. Salesperson
An individual representing a company to customers by performing one or more of the following activities: prospecting, communicating, selling, servicing, information gathering, and relationship building.
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7. The Nature of Personal Selling
The term salesperson covers a wide range of positions:
Order taker: Department store clerk.
Order getter: Demands creative selling and relationship building.
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8. The Role of the Sales Force
Personal selling:
Interpersonal interactions between salespeople and individual customers occur:
Face-to-face.
By telephone.
Through video or Web conferences.
By other means.
Personal selling is more effective than advertising in complex selling situations.
The role of personal selling varies by firm.
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9. Marketing in Action
Success in selling high-tech aircraft depends on building solid, long-term relationships.
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10. The Role of the Sales Force
The sales force serves as critical link between the company and its customers.
They represent the firm to the customers.
They represent the customers to the firm.
Goal = customer satisfaction and firm profit.
Sales and other marketing functions should work together to create value.
Firms can take several actions to bring marketing and sales functions closer.
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11. Sales Force Management
The analysis, planning, implementation, and control of sales force activities.
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12. Figure 13.1: Major Steps in Sales Force Management
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13. Managing the Sales Force
Types of sales force structure:
Territorial: Salesperson is assigned to an exclusive geographic territory in which that salesperson sells the company’s full line.
Product: Salespeople specialize in selling only a portion of the company’s products or lines.
Customer: Salespeople specialize in selling only to certain customers or industries.
Complex: Combination of several types of structures.
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14. Marketing in Action
Medical supplier Hill-Rom adopted a customer-based sales force structure in order to focus in more intensely on the needs of key customers.
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15. Managing the Sales Force
Sales force size:
May range in size from only a few salespeople to tens of thousands.
Increasing sales force size will increase both costs and sales.
Workload approach can be useful in setting sales force size. This requires:
Grouping accounts by factors related to the effort required to maintain them.
Determining the number of people needed to call on each class of accounts.
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16. Managing the Sales Force
Other sales force strategy and structure issues include decisions related to use of:
Outside sales force:
Travels to call on customers in the field.
Inside sales force:
Conducts business from their offices via telephone or the Internet, or visits from prospective buyers.
Team selling:
Using teams of people from sales, marketing, engineering, finance, technical support and even upper management to service large, complex accounts.
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17. Marketing in Action
The web or phone selling can be as effective as a personal sales call for may situations.
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18. Fuel for Thought
Inside sales forces use the phone or Internet to service and contact customers.
For what types of products or services do you think that an inside sales force might be more effective than an outside sales force? Explain.
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19. Managing the Sales Force
Team selling is used to service large complex accounts and can include experts from:
Sales
Marketing
Technical
R&D
Engineering
Operations
Finance
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20. Managing the Sales Force
Key advantage of team selling:
Can find problems, solutions, and sales opportunities that no single salesperson could alone.
Pitfalls of team selling:
Salespeople are competitive and have typically been rewarded on the basis of individual performance.
Team selling can confuse or overwhelm customers.
Some people have trouble working in teams.
Difficult to evaluate individual contributions.
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21. Managing the Sales Force
Careful recruiting and selection of salespeople can greatly enhance overall sales force performance while minimizing costly turnover.
Poor selection:
Increases recruiting and training costs
Lost sales
Disrupts customer relationships
Key talents of successful salespeople:
Intrinsically motivated.
Disciplined work style.
Ability to close a sale.
Ability to build relationships with customers.
Several recruiting sources exist.
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22. Managing the Sales Force
Recruiting Sources
Recommendations from current sales force
Employment agencies
Classified ads
Searching the Web
Working with college placement services
Recruit from other companies
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23. Managing the Sales Force
Seminars, sales meetings, and Web e-learning form the basis of many sales training programs.
Though expensive, training can yield dramatic results.
Training programs have several goals.
Customer knowledge.
The selling process.
Company, product, and market knowledge.
Online training is becoming more common.
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24. Marketing in Action
E-training can make sales training more efficient and fun. The Rep Race role playing video game used by Bayer Healthcare Pharmaceuticals increased sales rep effectiveness by 20%.
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25. Managing the Sales Force
Compensating salespeople involves a mix of compensation elements:
Fixed amount:
Salary = stable income.
Variable amount:
Commissions or bonuses = performance reward.
Expenses:
Repays for job-related expenditures.
Fringe benefits:
Vacations, sick leave, pension, etc.
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26. Managing the Sales Force
Goal of supervision is to encourage salespeople to “work smart” by:
Helping them to identify customers and set call norms.
Specifying time to be spent prospecting via:
Annual call plan.
Time-and-duty analysis.
Helping salespeople to work more efficiently using sales force automation systems.
Laptops, smart phones, Webcams, wireless access.
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27. Figure 13.2: How Salespeople Spend Their Time
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28. Managing the Sales Force
Selling and the Internet:
The internet is the fastest-growing sales technology tool.
Uses include training, servicing accounts, and conducting live sales meetings with sales force or customers.
The internet can save time & travel dollars and give sales people a new tool.
Sales 2.0 technologies are costly and can intimidate workers or customers.
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29. Supervising and Motivating Salespeople Selling and the Internet
Sales 2.0 is the merging of innovative sales
practices with Internet 2.0 technologies to improve sales force effectiveness and efficiency
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30. Marketing in Action
Sales 2.0 lets sales people connect, learn, plan, collaborate and conduct business in ways that weren’t even imagined years before.
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31. Managing the Sales Force
Goal of motivating the sales force is to encourage salespeople to “work hard”.
Management can boost sales force morale and performance via:
Organizational climate.
Sales quotas.
Positive incentives.
Sales meetings.
Sales contests.
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32. Managing the Sales Force
Organizational climate describes the feeling that salespeople have about their opportunities, value, and rewards for good performance.
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33. Managing the Sales Force
Sales quotas are standards that state the amount a salesperson should sell.
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34. Managing the Sales Force
Positive incentives include:
Sales meetings that can provide social occasions to meet management and discuss opportunities and challenges.
Sales contests to motivate the sales force to make additional effort.
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35. Managing the Sales Force
Evaluating salespeople and sales force performance requires:
Getting regular information from salespeople via sales reports, call reports, and expense reports.
Clear standards for judging performance.
Providing constructive feedback to the sales people that can motivate them to perform.
Return on sales investment should be assessed for the sales force as a whole.
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36. The Personal Selling Process
The goal of the personal selling process is to get new customers and obtain orders from them.
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37. Figure 13.3: Steps in the Selling Process
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38. The Personal Selling Process
Steps in the selling process include:
Prospecting and qualifying:
Identifying qualified potential customers, and screening out poor ones.
Preapproach:
Learning as much as possible about a prospective customer before making a sales call.
Approach:
Meeting the customer for the first time.
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39. The Personal Selling Process
Steps in the selling process include:
Presentation:
Telling the “value story” to the buyer, showing how the firm’s offer solves problems.
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40. The Personal Selling Process
Steps in the selling process include:
Handling objections:
Seeking out, clarifying, and overcoming customer objections to buying.
Closing:
Asking the customer for an order. Salespeople should recognize signals from the buyer, including physical actions, comments, and questions to close the sale.
Follow-up:
Following up after the sale to ensure customer satisfaction and repeat business.
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41. The Personal Selling Process
Personal selling and managing customer relationships:
The selling process just covered is transaction oriented.
But building profitable relationships is a key goal for most firms.
Building relationships requires listening to customers, understanding their needs, and carefully coordinating the whole firm’s efforts to create value.
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42. Some marketers use the term “promotions” to refer to sales promotion.
Short-term incentives to encourage the purchase or sale of a product or service.
Some marketers use the term “promotions” to refer to sales promotion.
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43. Sales Promotion Sales promotion: Can be targeted toward:
Final buyers (consumer promotions).
Retailers and wholesalers (trade promotions).
Business customers (business promotions).
Members of the sales force (sales force promotions).
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44. Sales Promotion
Several factors have contributed to the rapid growth of sales promotion:
Product managers are facing more pressure to increase their current sales.
Companies face more competition from less differentiated brands.
Advertising efficiency has declined due to rising costs, clutter, and legal constraints.
Consumers have become more deal oriented.
Large retailers are demanding more deals from suppliers.
Growth in sales promotion has resulted in promotion clutter.
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45. Marketing in Action
Manufacturers have had to seek new ways of breaking through sales promotion clutter via larger coupon values, more dramatic POP displays, or use of interactive media.
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46. Sales Promotion Sales promotion objectives:
Consumer promotions urge short-term sales or attempt to enhance customer brand involvement.
Trade promotions attempt to get retailers to carry new items and more inventory, to buy ahead, to promote the firm’s brand, and to give the company more shelf space.
Sales force promotions include gaining more sales force support for current or new products or getting salespeople to sign up new accounts.
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47. Sales Promotion
Sales promotions should be used with and supported by other promotion mix tools.
Sales promotion should focus on reinforcing the product’s position and building long-term customer relationships, rather than simply encourage brand switching or short-term sales only.
Use of frequency cards and loyalty programs has grown.
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48. Marketing in Action
Starbucks ran ads telling customers why its coffee is worth a higher price, then built loyalty by promoting its Starbucks Card Reward program.
Promotional discounts will detract from a brand’s premium positioning, a fact which led Starbucks to create a loyalty card program.
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49. Consumer Sales Promotion Tools
Samples
Coupons
Cash refunds
Price packs
Premiums
Advertising specialties
Point-of-purchase promotions
Contests
Sweepstakes
Games
Event marketing (event sponsorships)
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50. Consumer Sales Promotions Tools
Samples offer a trial amount of a product.
Coupons are certificates that give buyers a saving when they purchase specified products.
Cash refunds are similar to coupons except that the price reduction occurs after the purchase.
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51. Consumer Sales Promotions Tools
Samples
Trial amount
Effective
Expensive
Coupons
Promote trial of new brand
Stimulate sales of mature brand
Redemption rates are declining
New distribution methods
Cash Refunds (rebates)
Price reduction after sale
Consumer must send in proof of purchase
Can be very successful for marketer
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52. Fuel For Thought
Many marketers are moving their couponing and sampling efforts online. Consumers can request samples at All-Free-Samples.com, while CouponCabin and Krogers both offer access to a variety of coupons.
What are the benefits of online coupon distribution?
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53. Consumer Sales Promotions Tools
Price packs offer consumers savings off the regular price of a product.
Premiums are goods offered either free or at low cost to buy a product.
Advertising specialties are useful articles imprinted with the advertiser’s name, logo, or message that are given as gifts to consumers.
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54. Consumer Sales Promotions Tools
Price packs
Also called cents-off
Market directly on package
Effective in short-term sales
Premiums
Free or low cost goods
Inside or outside the package
Advertising specialties
Also called promotional products
Include useful articles with advertiser’s name
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55. Consumer Sales Promotions Tools
Patronage rewards are cash or other awards offered for the regular use of a certain company’s products or services
Point-of-purchase promotions include displays and demonstrations that take place at the point of sales
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56. Consumer Sales Promotions Tools
Contests, sweepstakes, and games give consumers the chance to win something, such as cash, trips, or goods, by luck or through extra effort.
Contests require an entry by a consumer.
Sweepstakes require consumers to submit their names for a drawing.
Games present consumers with something that may or may not help them win a prize.
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57. Consumer Sales Promotions Tools
Point-of-purchase (POP)
Displays and demonstrations
Retailers receive many and only have room for some
Contests, sweepstakes, games
Chance to win
Event marketing
Brand marketing events
Fast growing
Can be less costly
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58. Marketing in Action
Contests can create considerable consumer involvement. The “Create Dunkin’s Next Donut” campaign resulted in 130,000 online creations.
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59. Trade Promotions
Trade promotions are sales promotion tools used to persuade resellers to carry a brand, give it shelf space, promote it in advertising, and push it to the consumer
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60. Sales Promotion Trade promotions:
More sales promotion dollars are directed toward retailers and wholesalers than to the final consumers.
Several trade promotion tools exist:
Discounts.
Allowances.
Free goods.
Push money.
Specialty advertising items.
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61. Business Promotions
Business Promotions are sales promotion tools used to generate business leads, stimulate purchases, reward customers, and motivate salespeople.
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62. Sales Promotion Business promotions objectives:
Generate business leads.
Stimulate purchases.
Reward customers.
Motivate salespeople.
Business promotion tools:
Conventions, trade shows, sales contests, and many of the same tools used for consumer or trade promotions.
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63. Sales Promotion Business Promotion Tools
Conventions and trade shows are effective ways to reach many customers not reached with the regular sales force.
Sales contests are effective in motivating salespeople or dealers to increase performance over a given period.
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64. Marketing in Action
Some trade shows are huge. The International Consumer Electronics show boasts 3000 exhibitors and attracts 110,000 professional visitors.
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65. Sales Promotion Developing the sales promotion program:
Decide on the size of the incentive.
Set conditions for participation.
Decide how to promote and distribute the promotion program.
Determine the length of the program.
Evaluate the promotion program.
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66. Reviewing the Concepts
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.
Discuss the personal selling process, distinguishing between transaction-oriented marketing and relationship marketing.
Explain how sales promotion campaigns are developed and implemented.
Copyright 2011, Pearson Education Inc., Publishing as Prentice-Hall