Chapter 15 – Personal Selling and Sales Promotion.docx

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McMaster University
Grant B Mc Clelland

Chapter 15 – Personal Selling and Sales Promotion  Personal selling is critical to the success of many organizations  Salespeople are often the most important revenue generator  provide value to their organizations, if they are able to provide value to their customers.  Sales promotion includes those marketing activities other than personal selling, advertising, and publicity designed to enhance consumer purchasing and dealer effectiveness The Evolution of Personal Selling  Personal selling is the process of a seller’s person-to-person promotional presentation to a buyer  Interpersonal influence process, is basic to any enterprise  Seller needs to match the needs of a client/customer before, during and after sale  problem solvers  almost 10 percent of the Canadian labour force is employed in sales positions testifies to the importance of selling  the single largest marketing expense in many firms  thousands of years old.  Personal selling is a vital, vibrant, dynamic process The Four Sales Channels  Includes business-to-business and direct-to-customer selling Over-the-Counter Selling  Personal selling conducted in retail and some wholesale locations in which customers come to the seller’s place of business  Best Buy’s CARE Plus mantra has allowed it to outsell its competitors.  Direct-to-customer Field Selling  Sales presentations made at prospective customers’ locations on a face-to-face basis  Expensive  travel expenses  In routine cases, the salesperson processes regular customers’ orders.  In more complex cases, the salesperson prepares for weeks, makes presentations, and follows up.  Developed g/s designed to help salespeople do their jobs  On a per call basis it’s Expensive because of :  Salary  Bonus  Benefits  Car lease  Car Operating Costs  Supplies/PC o Easily exceeds $100,000 per Rep  Effectiveness!  1 Field Rep can influence M’s of sales per Sales Territory  Maximum impact when company uses sustained Pull Strategy  Personal Selling is the most context-rich of all Promotional techniques  Field Territories are Designed and Adjusted to reflect:  Direct sales potential  Indirect sales potential  # of Customers/Accounts  Types of Customers/Accounts  Travel time  Work load balance across territories  Network marketing – Personal selling that relies on lists of family members and friends of the salesperson, who organizes a gathering of potential customers for a demonstration of products Ex: Avon, Mary Kay Cosmetics Telemarketing  The selling process is conducted by phone.  Serves two purposes:  Sales  Service  Serves two markets:  B2B  B2C  Outbound telemarketing – Sales method in which sales personnel place phone calls to prospects and try to conclude the sale over the phone  Technologies used: o Predictive diallers o Autodialling o Random-digit dialling  Drawback:  Most consumers dislike the practice and have signed up for the Canadian Do Not Call List.  Some firms still use telemarketing because:  The average call cost is low  Firms point to a significant rate of success  Inbound telemarketing – Sales method in which prospects call a seller to obtain information, make reservations, and purchase goods and services  Call-center positions in Canada  inbound  Technical knowledge and better sales process skills  higher salaries Inside Selling  Selling by phone, mail, and electronic commerce  Lead generation. Turn opportunities into actual sales  Support technicians and purchasers with current solutions  go beyond taking orders to solving problems, providing customer service, and selling  relies on close working relationships with field sales representatives to solidify customer relationships Integrating the Various Selling Channels  how firms are likely to blend alternative sales channels to create a successful cost-effective sales organization.  Existing customers whose business problems require complex solutions are likely to be best served by the traditional field sales force.  current customers who need answers but not the same attention as the first group can be served by inside sales reps who call on them as needed.  Over-the-counter sales reps serve existing customers by supplying information and advice and completing sales transactions.  Telemarketers may be used to strengthen communication with customers or to re-establish relationships with customers that may have lapsed over a few months. Trends in Personal Selling Relationship Selling  Buyers prefer to do business with people who: 1. Orchestrate events and bring to bear whatever resources are necessary to satisfy the customer 2. Provide counseling to the customer based on in-depth knowledge of the product, marketer and customers needs 3. Solve problems efficiently to ensure satisfaction service over time periods 4. Demonstrate high ethical standards and communicate honestly 5. Willingly advocate the customers cause within the selling organization 6. Create imaginative arrangements to meet buyers’ needs 7. Arrive prepared for sales calls Consultative Selling (needs-driven)  Meeting customer needs by listening to them, understanding their problems, paying attention to details, and following through after the sale  Online companies have instituted consultative selling models to create long-term customers.  Cross selling – Offering multiple goods or services to the same customer based on knowledge of that customer’s needs Team Selling  A salesperson joins with specialists from other functional areas of the firm to complete the selling process.  Customers often feel better served by a team approach.  Relationships form between companies rather than between individuals.  companies establish permanent sales-and-tech teams that conduct all sales presentations together  Virtual sales teams – A network of strategic partners, suppliers, and others who are qualified and willing to recommend a firm’s goods or services Sales Tasks Order Processing  Selling, mostly at the wholesale and retail levels, that involves identifying customer needs, pointing them out to customers, and completing orders  primary task in situations where needs can be readily identified and are acknowledged by the customer  will devote some time persuading their wholesale or retail customers to carry more complete inventories of their firms’ merchandise or to handle additional product lines  to try to motivate purchasers to feature some of their firms’ products, increase the amount of shelf space devoted to these items, and improve product location in the store Creative Selling  Personal selling in which a considerable degree of analytical decision making on the buyer’s part results in the need for skillful proposals of solutions for the customer’s needs Ex: Software  can generate “buzz” for a product  Used to develop new business with either new customers or new products Missionary Selling (Detailing)  Indirect selling method in which salespeople promote goodwill for the firm by educating customers and providing technical or operational assistance  May offer sales incentives such as trips, gas cards, or free product upgrades Ex: a cosmetics company salesperson may call on retailers to check on special promotions and overall product movement, even though a wholesaler takes orders and delivers merchandise  salesperson services the retail customer, who then places an order on a wholesaler. The Sales Process  AIDA concept and Personal Selling Process Prospecting and Qualifying  Prospecting – Identifying potential customers  Time-consuming and involves many sources Ex. direct mail and advertising campaigns  effective for identifying prospective customers  Qualifying – Determining that the prospect really is a potential customer  Not all prospects are qualified to make purchase decisions.  telemarketers to prospect and qualify leads that are then handed over to salespeople  Prospects may fail to become customers for several reasons: 1. They do not really see a need. 2. They cannot afford to make a purchase. 3. They do not have the authority to make a decision. 4. They may be unwilling to consider making a purchase Ex: I need a new car. I have a good credit rating and can get a loan. My spouse has agreed that I can decide to buy one if I wish. (This meets three criteria.) Unfortunately, I am not confident of the economy and so I do not want to make a purchase at this time. I do not meet the fourth criteria. I am not a qualified prospect. Approach  Initial contact with prospective customer  precall planning research to learn about the industry, the customer, his or her needs, and how your products might best meet these needs  good approach: o Educate yourself about the industry in general; and g/s of competitors o Read marketing research; go to trade shows (learn about companies and their products) o Learn about the firm you’re approaching  website, articles, press Presentation  Conveying the marketing message to the customer  A “features-benefits” framework focuses on the good or service in terms that are meaningful to the buyer.  Presentations should be well organized, clear, and concise.  Technology must be used efficiently to be effective.  Cold calling – Contacting a prospect without a prior appointment  approach and presentation often take place at the same time.  Requires nerve, skill, and creativity Demonstration  The customer has the opportunity to try out or otherwise see how a g/s works before purchasing  Multimedia interactive demonstrations are becoming more common. Ex: Demonstration videos Black & Decker posts on its website  Key to an outstanding demonstration is planning  work because they visually prove any claims you may make  should be prepared to stop and answer questions, re-demonstrate a certain feature, or let the customer try the product firsthand. Han
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