Download Personal Selling and Sales Promotion

Chapter 17
PERSONAL
SELLING AND
SALES
PROMOTION
© 2014 Cengage Learning. All Rights Reserved. May
not be scanned, copied or duplicated, or posted to a
publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Objectives
1. Describe the role of today’s salesperson.
2. Describe the four sales channels.
3. Describe the major trends in personal
selling.
4. Identify and briefly describe the three
basic sales tasks.
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Objectives
5. Outline the seven steps in the sales
process.
6. Identify the seven basic functions of a
sales manager.
7. Explain the role of ethical behavior in
personal selling.
8. Describe the role of sales promotion in
the promotional mix, and identify the
different types of sales promotions.
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Introduction
▮Personal selling - Interpersonal influence
process involving a seller’s promotional
presentation conducted on a person-toperson basis with the buyer
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Table 17.1 - Factors Affecting the Importance of
Personal Selling in the Promotional Mix
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
The Evolution of Personal Selling
▮Selling has been a standard business
activity for thousands of years
▮Salespeople are problem solvers
▮Personal selling is a vital, vibrant, dynamic
process
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
The Evolution of Personal Selling
▮Salespeople must be able to:
• Focus on a customer’s situation and needs and
create solutions that meet those needs
• Follow through and stay in touch before, during,
and after a sale
• Know the industry and have a firm grasp of
their firm’s and their competitors’ abilities
• Work hard to exceed their customers’
expectations
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Over-the-Counter Selling
▮Personal selling in which customers come
to the seller’s place of business
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Field Selling
▮Sales presentations made at prospective
customers’ locations on a face-to-face basis
▮Expensive form of selling, particularly
because of 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
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Field Selling
▮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
▮Examples: Avon, Pampered Chef,
Tupperware
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Telemarketing
▮Selling process conducted by phone
▮Serves two purposes
• Sales
• Service
▮ Serves two markets
• B2B
• B2C
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Telemarketing
▮Outbound telemarketing - Sales method
in which sales personnel place phone calls
to prospects and try to conclude the sale
over the phone
▮Technologies used
• Predictive dialers
• Autodialing
• Random-digit dialing
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Telemarketing
▮Drawback
• Most consumers dislike the practice and have
signed up for the national Do Not Call Registry
▮Some firms still use telemarketing because:
• The average call cost is low
• Firms point to a significant rate of success
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Telemarketing
▮Inbound telemarketing - Sales method in
which prospects call a seller to obtain
information, make reservations, and
purchase goods and services
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Inside Selling
▮Selling by phone, mail, and electronic
commerce
▮Turns opportunities into actual sales
▮Support technicians and purchasers with
current solutions
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Figure 17.1 - Alternative Sales Channels
for Serving Customers
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Relationship Selling
▮Regular contacts between sales
representatives and customers over an
extended period to establish a sustained
buyer-seller relationship
▮Important to both, B2B and B2C sales
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Table 17.2 - What Buyers Expect from
Salespeople
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Consultative Selling
▮Meeting customer needs by listening to
them, understanding their problems, paying
attention to details, and following through
after the sale
▮Cross-selling - Offering multiple goods or
services to the same customer
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Team Selling
▮Several sales associates are employed to
help the lead sales representative reach all
those who influence the purchase decision
▮Customers often feel better served by a
team approach
▮Relationships form between companies
rather than between individuals
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Team Selling
▮Virtual sales teams - A network of
strategic partners, suppliers, and others
who are qualified and willing to recommend
a firm’s goods or services
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Order Processing
▮Selling that involves identifying customer
needs, pointing them out to customers, and
completing orders
• Identify customer needs
• Point out the need to the customer
• Complete (write up) the order
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Creative Selling
▮Salespeople use well-planned strategies to
seek new customers by proposing
innovative solutions to customers’ needs
▮Used to develop new business with either
new customers or new products
▮Generates “buzz” for a product
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Missionary Selling
▮Promoting goodwill for the firm by
educating customers and providing
technical or operational assistance
▮Sales incentives - Programs that reward
salespeople for superior performance
• Trips, gas cards, or free product upgrades
▮May involve both field selling and
telemarketing
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Figure 17.2 - The AIDA Concept and the
Personal Selling Process
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Prospecting and Qualifying
▮Prospecting - Personal selling function of
identifying potential customers
▮Qualifying - Determining a prospect’s
needs, income, and purchase authority as a
potential customer
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Approach
▮Initial contact with prospective customer
▮Precall planning
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Presentation
▮Describing a product’s major features and
relating them to a customer’s problems or
needs
▮Technology must be used efficiently to be
effective
▮Cold calling - Contacting a prospect
without a prior appointment
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Demonstration
▮Customer has the opportunity to try out
how a good works before purchase
▮Multimedia interactive demonstrations are
now common
▮Example: Demonstration videos Black &
Decker posts on its website
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Handling Objections
▮Objections - Expressions of resistance by
the prospect
▮May take the form of stalling or
indecisiveness
▮Use objections as an opportunity to
reassure the buyers
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Closing
▮the salesperson asks the customer to make
a purchase decision
▮Possible strategies
• Addressing the prospect’s major concern about
a purchase and then offering a convincing
argument
• Posing choices for the prospect in which either
alternative represents a sale
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Closing
• Advising the buyer that a product is about to be
discontinued or will go up in price soon
• Remaining silent so the buyer can make a
decision on his or her own
• Offering an extra inducement designed to
motivate a favorable buyer response
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Follow-Up
▮Postsale activities that often determine
whether an:
• Individual who has made a recent purchase will
become a repeat customer
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Managing the Sales Effort
▮Sales managers handle the overall direction
and control of the personal selling effort
▮Requires an appropriate mix of sales and
management skills
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Recruitment and Selection
▮Successful sales careers offer:
•
•
•
•
•
Opportunity for advancement
Potential for high earnings
Personal satisfaction
Job security
Independence and variety
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Training
▮Primary methods are on-the-job training,
individual instruction, how-to classes, and
external seminars
▮Use videos, simulations, and executive
development programs
▮Ongoing training is important for
experienced salespeople
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Organization
▮May be based on geography, products, types
of customers, or some combination of these
factors
▮National accounts organization - A
dedicated sales team is assigned to a firm’s
major customers to provide sales and
service needs
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Figure 17.3 - Basic Approaches to
Organizing the Sales Force
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Supervision
▮Span of control - Number of sales
representatives who report to first-level
sales managers
▮Optimal span of control is affected by:
• Complexity of work activities
• Ability of the individual sales manager
• Degree of interdependence among individual
salespeople
• Extent of training each salesperson receives
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Motivation
▮Motivational tools include information
sharing, recognition, bonuses, incentives,
and benefits
▮Expectancy theory – Motivation depends
on an individual’s expectations of:
• His or her ability to perform a job and how that
performance relates to attaining a desired
reward
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Compensation
▮Commission - Incentive compensation
directly related to the sales or profits
achieved by a salesperson
▮Salary - Fixed payment made periodically
to an employee
▮Compensation packages vary according to
industry
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Figure 17.4 - Median Pay for Account
Managers by Years of Experience
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Evaluation and Control
▮Managers must set standards and choose
the best methods for measuring sales
performance
▮Sales quotas - Level of expected sales for a
territory, product, customer, or salesperson
against which actual results are compared
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Evaluation and Control
▮Other measures include:
•
•
•
•
Customer satisfaction
Profit contribution
Share of product-category sales
Customer retention
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Ethical Issues in Sales
▮Honesty and ethical behavior is encouraged
when:
• Employees understand what is expected of
them
• Open communication is encouraged
• Managers lead by example
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Sales Promotion
▮Marketing activities other than personal
selling, advertising, and publicity that
enhance consumer purchasing and dealer
effectiveness
▮Integrated into overall marketing plan
▮Promotions are likely to stress price
advantages, giveaways, or special offers
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Sales Promotion
▮Goal is speeding the sales process and
increasing sales volume
▮Cannot overcome poor brand images,
product deficiencies, or poor training for
salespeople
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Consumer-Oriented Sales Promotions
▮Encourage repurchases by rewarding
current users
▮Boost sales of complementary products
▮Increase impulse purchases
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Coupons and Refunds
▮Coupons - Offers a discount on the
purchase price of goods or services
▮Refunds or rebates - Cash given back to
consumers who send in proof of purchase
for one or more products
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Samples, Bonus Packs, and Premiums
▮Sampling - Free distribution of a product to
obtain future sales
• Higher response rate than other forms of
promotion
• Good for promoting new or unusual products
• Relatively expensive form of promotion
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Samples, Bonus Packs, and Premiums
▮Bonus pack - Specially packaged item that
gives the purchaser a larger quantity at the
regular price
▮Premiums - Items given free or at reduced
cost with purchases of other products
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Contests and Sweepstakes
▮Contest - Sales promotion technique that
requires entrants to complete a task for the
chance to win a prize
▮Sweepstakes - Sales promotion technique
in which prize winners are selected by
chance
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Specialty Advertising
▮Places the advertiser’s name, address, and
advertising message on useful articles that
are then distributed to target consumers
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Trade-Oriented Promotions
▮Trade promotion - Sales promotion that
appeals to marketing intermediaries rather
than to consumers
▮Trade allowances - Special financial
incentives offered to wholesalers and
retailers that purchase or promote specific
products
• May give a discount on goods or include offinvoice allowances
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Trade-Oriented Promotions
▮Point-of-purchase (POP) advertising Display or other promotion located near the
site of the actual buying decision
▮Trade shows - Product exhibition
organized by industry trade associations to
showcase goods and services
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Trade-Oriented Promotions
▮Dealer incentives and contests reward
retailers who increase sales
▮Push money - Cash reward paid to retail
salespeople for every unit of a product they
sell
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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Chapter 17 Personal Selling and Sales Promotion
Hubway Video
http://www.cengage.com/marketing/book_content/boone_9781133628460/
videos/ch17.html
Scripps Networks Interactive & Food
Network Video
http://www.cengage.com/marketing/book_content/boone_9781133628460/
videos/part6.html
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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