Download Chapter 17

Personal Selling and
Direct Marketing
Chapter 17
Objectives
Understand the role of a
company’s salespeople in
creating value for customers
and building customers
relationships.
Know the six major sales force
management steps.
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Objectives
Understand the personal selling
process, and how to distinguish
between transaction-oriented
marketing and relationship marketing.
Learn about direct marketing and its
benefits to customers and companies.
Know the major forms of direct
marketing.
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c
Lear
Record-breaking
earnings and sales
growth
Outstanding sales
force; rated as one
of America’s best.
Sales force
focuses on
customer success
Sales force is
organized into
separate divisions
dedicated to specific
customers
Division platform
teams work with
customers and are
linked to customer
operations
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Definition
Salesperson
 An individual acting
for a company by
performing one or
more of the following
activities: prospecting,
communicating,
servicing, and
information gathering.
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Personal Selling
Salespeople Have Many Names
Agents
Sales
consultants
Sales
Representatives
Account
Executives
Sales Engineers
District Managers
Marketing
Representatives
Account
Development
Representatives
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Personal Selling
The Role of the Sales Force
 Two-way personal communication
 More effective than advertising in
complex selling situations
 The sales force plays a major role in
most companies
 The sales force works to produce
customer satisfaction and company
profit
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Definition
Sales Force Management
 The analysis, planning,
implementation, and control of sales
force activities. It includes setting and
designing sales force strategy; and
recruiting, selecting, training,
supervising, compensating, and
evaluating the firm’s salespeople.
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Figure 17-1:
Major Steps in
Sales Force Management
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Managing the Sales Force
Sales Force Strategy and Structure
 Sales Force Structure




Territorial sales force
structure
Product sales force
structure
Customer sales force
structure
Complex sales force
structure
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Managing the Sales Force
Sales Force
Strategy and
Structure
 Sales Force Size

Many companies
use the workload
approach to set
sales force size
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Managing the Sales Force
Sales Force Strategy and Structure
 Outside and inside sales forces

Team selling
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Managing the Sales Force
Recruiting and
Selecting
Salespeople
 Careful recruiting can:



Increase overall
sales force
performance
Reduce turnover
Reduce recruiting
and training costs
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Managing the Sales Force
Traits of Successful Salespeople
Enthusiasm
Patience
Initiative
Self-Confidence
Job Commitment
Customer
Orientation
Independent
SelfMotivated
Excellent
Listeners
Friendly
Persistent
Attentive
Honest
Internally
Motivated
Relationship
Oriented
Disciplined
Hardworking
Team Players
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Managing the Sales Force
Recruiting & Selecting Salespeople
 Recruiting involves:
Soliciting applications
 Screening candidates

• Interviews
• Sales aptitude, personality, analytical
and/or organizational tests
• References, work history, etc.
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Managing the Sales Force
Training Salespeople
 Average training period is
4 months
 Training is expensive, but
yields strong returns
 Training programs have
many goals
 Many companies are
adding Web-based sales
training programs
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U.S. companies spend more that $7 billion
annually on training salespeople and devote
more than 22 hours per year to the average
salesperson.
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Managing the Sales Force
Compensating Salespeople
 Compensation elements: salary,
bonuses, commissions, expenses, and
fringe benefits
 Basic compensation plans:
Straight salary
 Straight commission
 Salary plus bonus
 Salary plus commission

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Managing the Sales Force
Compensating
Salespeople
 Compensation plans
should direct the sales
force toward activities that
are consistent with overall
marketing objectives.



Gain market share
Solidify market
leadership
Maximize profitability
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Managing the Sales Force
Supervising Salespeople
 Effective supervisors provide direction to the
sales force



Annual call plans and time-and-duty analysis
can help provide direction
Sales force automation systems assist in
creating more efficient sales force operations
The Internet is the
fastest-growing sales
technology tool
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Figure 17-2:
How Salespeople Spend
Their Time
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Managing the Sales Force
Supervising Salespeople
 Effective supervisors
also motivate the
sales force



Organizational climate
Sales quotas
Positive incentives
• Sales meetings,
sales contests,
honors, etc.
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American Express
targets companies
in need of sales
force incentives.
The Persona
Select cards are
prepaid reward
cards that allow
recipients to buy
whatever they
most want.
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Managing the Sales Force
Evaluating
Salespeople
 Sales reports
 Call reports
 Expense
reports
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Figure 17-3:
The Personal Selling
Process
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The Personal Selling
Process
Prospecting and
Qualifying
 Prospecting:
identifying
potential
customers
 Qualifying:
Screening leads
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Discussion Question
“Cold calling” by salespeople – visiting
offices without an appointment – was
mentioned in the text as one method of
identifying potential prospects.
Discuss the pros and cons of cold
calling. Is it more appropriate for certain
industries or product types than others?
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BusinessNow
MarketSoft Video Clip
Trade shows are
often an excellent
source of sales
leads.
Click the picture above to play video
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The Personal Selling
Process
Preapproach
 Learning as much
as possible about
a prospective
customer prior to
making a sales call
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The Personal Selling
Process
Approach
 Stage of the
selling process
where the
salesperson
meets the
customer for
the first time
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The Personal Selling
Process
Presentation & Demonstration
 Benefits of the
product are
presented or
demonstrated
 Understanding
prospect
needs is key
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Virtual reality is being used by Johnson &
Johnson’s sales representatives to help
prospects learn about STERRAD.
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The Personal Selling
Process
Handling
Objections
Closing
 Asking for the
order
Follow-up
 Helps ensure
customer
satisfaction
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Direct Marketing
Direct Marketing
Benefits: Buyers




Convenient
Easy to use
Private
Access to a
wealth of
information
 Immediate
 Interactive
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Direct Marketing
Direct Marketing Benefits: Sellers
 Powerful tool for building relationships
 Allows for targeting of small groups or
individuals with customized offers in a
personalized fashion
 Offers access to buyers that couldn’t
be reached via other channels
 Low-cost, effective alternative for
reaching specific markets
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Dell’s
success
is due to
their
direct
selling
model
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Direct Marketing
Customer Databases & Direct
Marketing
 Databases include customer profile,
purchase history, and other detailed
information
 Databases can be used to identify
prospects, profile customers, and
select customers to receive offers, and
to build relationships
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Direct Marketing
Customer
Databases &
Direct Marketing
 Database
marketing requires
substantial
investment in
hardware,
software, and
personnel
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Discussion Question
Suppose that you work for
a casino that has recently
decided to develop a
database in order to better
target promotional offers to
its clientele.
What types of information
would you collect or track in
this database? List as many
database fields as you feel
are appropriate.
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Figure 17-4:
Forms of Direct Marketing
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Direct Marketing
Telephone Marketing
 Inbound toll-free 800
numbers are used to
receive orders from
print or TV ads
 New legislation and
technological
advances threaten
the future of
telemarketing
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Direct Marketing
Direct-Mail
Marketing
 New trends
include fax, mail,
e-mail, and voice
mail
Catalog
Marketing
 Many
cataloguers
have migrated to
the web
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Direct Marketing
Direct-Response
Television
Marketing
 Direct-response
advertising
 Infomercials
 Home shopping
channels
Kiosk Marketing
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Figure 17-5:
An Integrated
Direct-Marketing Campaign
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Direct Marketing
Integrated Direct Marketing
Public Policy and Ethical Issues
 Irritation, Unfairness, Deception,
and Fraud
 Invasion of Privacy
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The DMA recently developed its “Privacy
Promise to American Consumers”
DMA Privacy
Policy
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