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Chapter

Module 8 Notes


Department
Marketing
Course Code
MKT 100
Professor
Paul Finlayson

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Module 8: Pricing
Section 1: Sales Objectives
Product and service always goes through several selling effots
oMust be personally sold to invenstors or senor execs
oPersonally sold to production and sales force
oSalesfroce get the chance to personally sell the product to distributors,
retailers or end users
Good sales people know more about their slice of the marketplace than anyone else
in the company
Objectives of personal selling
oTo keep current customers happy and loyal, particularily highly profitable
customers
oPersuade a current customer to buy more
oPersuade a potential customer to buy a new product or service
oTo feedback ideas on customer needs, improved product positioning, and the
success of company and competitor marketing tactics
Most important goal to achieve financial and marketing goals
Some salesforce spend all their time selling to distributors
Typical Functions of a Field Salesforce
Most of a sales persons time is spend not in contact with the customer
Different industries have different jobs for their salesforce
Relationship Selling Processes
Creative relationship innovations should be highly valued, even though they are
seldom discussed in sales literature
Much of the popular sales training literature still stresses the importance of
teaching standard operating procedures that were developed in the 1920s (eg how to
close a sale)
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Four Approaches to Relationship Selling
Expanding the size of the pie
oExpand size of current deal through economies of scale, reduce the costs to
the seller and buyer of both selling and buying
Giving back part of the pie
oBuyer and seller frankly talk about which parts of the trading terms are most
important to each
Adding a new ingredient to the pie
oExpand the terms of the trade by adding another dimension, such as offering
and extended after-sales service and consumables, long term relationship[
Reengineering the whole pie-making process
oBridging: Create a completely different trading relationship by changing the
existing relationship processes
For a seller to embark on any of the four relationship selling approaches, a
foundational relationship must exist based on mutual respect expected cooperation,
and performance
Fitting the sales function to customer buying behaviour
Many business customers have regular purchase cycles and buying review cycles
Customers buying behaviour and channel use will define the selling role of top
management
A key to making customers more profitable is to reduce the cost of servicing and
selling by timing the sales effort around the customers decision making
Order takers: involved in transactional sales
Order getters: required to uncover customer needs by understanding their product
or service usage processes
Section 2: Salesforce Structure
Gives special service consideration to the few major customers who constitute most
of the business (house accounts)
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80% of a firms business comes from the top 20% of its customers
National Account Management: development of special teams for the largest,
most complex customers
Customer is in a position of power because multiple sellers are rushing to meet the
customers every need
Sellers cant afford to lose their business
Clear roles for sales people lead to higher job satisfaction
Account managing stereotyped only for large businesses, but good idea to look at
small businesses as well
EDI and cross-functional team selling
Electronic data interchange (EDI): enables automated, just-in-time delivery and
the close monitoring of product and service quality conformance to the contract
Order taking and routine customer service components of a salespersons job are
greatly reduced or even eliminated in business-to-business or vender-to-retailer
market
Cross-functional team management good
High Growth stresses on salesforce structure
A seller in a high growth market faces particular problems b/c it constantly has to
adjust its organization as the number of actual or potential customers in a sales
territory becomes too large for a single salesperson to service
Field Salesforce Organization
Can be organized in many different ways
oProduct
oGeographic
oCustomer
oStage in selling process
Some customers deserve and must get better customer service than others
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