sales promotion and personal selling

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Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 16

1

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CHAPTER

16

Sales Promotion and Personal Selling

Prepared byDeborah Baker

Texas Christian University

Introduction to MarketingMcDaniel, Lamb, Hair

9

2Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 16

Learning OutcomesDefine and state the objectives of sales promotion

Discuss the most common forms of consumer sales promotion

List the most common forms of trade sales promotion

Describe personal selling

LOI

LO2

LO3

LO4


Learning Outcomes

Discuss the key differences between relationship selling and traditional selling

List the steps in the selling process

Describe the functions of sales management

LO5

LO6

LO7

4Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved

Chapter 16

Define and state the objectives of sales promotion

Sales PromotionLOI


Chapter 16

Sales Promotion

SalesPromotion

LOI

Marketing communication activities, other than advertising, personal selling, and public relations, in which a short-term incentive motivates a purchase.


LOI

Advertising

Sales Promotion

Reason to buy

Sales Promotion Incentive to buy


LOI Sales Promotion

ConsumerSales

Promotion

Trade Sales

Promotion

Consumer market

Marketing channel

Drive immediate purchaseInfluence behavior Goal


Chapter 16

LOI

Type of BuyerType of Buyer

Loyal Customers

Competitor’sCustomers

Brand Switchers

Price Buyers

Desired ResultsDesired Results

•Reinforce behavior• Increase consumption•Change purchase timing

•Break loyalty•Persuade to switch

•Persuade to buy your brand more often

•Appeal with low prices

•Supply added value

Sales PromotionSales PromotionExamples Examples

•Loyalty marketing•Bonus packs

•Sampling•Sweepstakes, contests, premiums

•Price-lowering promotion

•Trade deals

•Coupons, price-offpackages, refunds

•Trade deals

Objectives of Sales Promotion


REVIEW LEARNING OUTCOMEThe Objectives of Sales PromotionLOI


Chapter 16

Discuss the most common forms of consumer

sales promotion

Tools for Consumer Sales PromotionLO2


Chapter 16LO2

Coupons and Rebates

Premiums

Loyalty Marketing Programs

Contests & Sweepstakes

Sampling

Point-of-Purchase Promotion

Tools for Consumer Sales Promotion


Chapter 16LO2


Coupon

Rebate

Premium

A certificate that entitles consumers to an immediate

price reduction.

A cash refund given for the purchase of a product during

a specific period.

An extra item offered to the consumer, usually in exchange

for some proof of purchase.


Chapter 16

LO2

LoyaltyMarketingProgram

A promotional program designed to build long-term, mutually beneficial relationships between a company and key customers.

FrequentBuyer

Program

A loyalty program in which loyal consumers are rewarded for making multiple purchases.



Chapter 16

LO2

Contests Promotions that require skill or ability to compete for prizes.

SweepstakesPromotions that depend on chance or luck, with free participation.


Online

http://www.sweepstakesonline.com

http://www.sweepstakesonline.com/


Chapter 16 LO2


SamplingA promotional program that allows the consumer the opportunity to try a product or service for free.


LO2

Direct mail

Door-to-door delivery

Packaging with another product

Retail store demonstration

Methods of Sampling


Chapter 16 LO2

Build traffic

Advertise the product

Induce impulse buying

Point-of-Purchase Promotion


Chapter 16

Online Sales PromotionLO2

Free merchandise

Sweepstakes

Free shipping with purchases

Coupons

Effective Types of Online Sales Promotion


REVIEW LEARNING OUTCOMEConsumer Sales PromotionLO2

Coupons and rebates

Premiums

Loyalty marketing programs

Contests

Sampling

P-O-P

Online


Chapter 16

List the most common forms of trade sales promotion

Tools for Trade Sales PromotionLO3


Chapter 16

Trade Sales PromotionLO3

Trade Allowances

Push Money

Training

Free Merchandise

Store Demonstration

Conventions & Trade Shows


Chapter 16

LO3

TradeAllowance

A price reduction offered by manufacturers to intermediaries, such as wholesalers and retailers.

Trade Allowance


Chapter 16

LO3

Push MoneyMoney offered to channel intermediaries to encourage them to “push” products--that is, to encourage other members of the channel to sell the products.

Push Money


Chapter 16 LO3

Benefits of Trade Promotions

Help manufacturers gain new distribution

Obtain wholesaler and retailer support forconsumer sales promotions

Build or reduce dealer inventories

Improve trade relations


REVIEW LEARNING OUTCOMEForms of Trade Sales PromotionLO3


Chapter 16

Describe personal selling

Personal SellingLO4


LO4 Personal SellingPersonal Selling

is more important if...

Customers are concentrated.

Product is technically complex.

There are few customers.

Product is custom made.

Product has a high value.

Customers are geographically dispersed.

Product is simple to understand.

There are many customers.

Product is standardized.

Product has a low value.

Advertising & Sales Promotion are more important if...


REVIEW LEARNING OUTCOMEPersonal SellingLO4

Detailed explanation or demonstration

Variable sales message

Directed to qualified prospects

Controllable adjustable selling costs

More effective than other promotion in obtaining sale and gaining customer satisfaction

PersonalSelling

Advantages


Chapter 16

Discuss the key differences between relationship selling

and traditional selling

Relationship SellingLO5


Chapter 16

LO5

Relationship(Consultative)

Selling

Relationship Selling

A sales practice that involves building, maintaining, and enhancing interactions with customers in order to develop long-term satisfaction through mutually beneficial partnerships.


Chapter 16

Traditional Selling and Relationship SellingLO5

Sell advice, assistance, counsel Sell products

TraditionalTraditionalPersonal SellingPersonal Selling

Focus on closing sales

Limited sales planning

Discuss productAssess “product-specific” needs“Lone wolf” approach

Pricing/product focus

Short-term sales follow-up

Focus on customer’s bottom line

Sales planning is top priority

Build problem-solving environmentConduct discovery in scope of operationsTeam approachProfit impact and strategic benefit focusLong-term sales follow-up

Relationship SellingRelationship Selling


REVIEW LEARNING OUTCOME Relationship Selling vs. Traditional SellingLO5

InitialSales

RepeatSales

SuccessiveSales

Traditional Sales

Relationship Sales

SalesIncreasesResultFromCreatingValue


Chapter 16

List the steps in the selling process

Steps in the Selling ProcessLO6


Chapter 16 LO6

Generate Leads

Qualify Leads

Probe Customer Needs

Develop Solutions

Handle Objections

Close the Sale

Follow Up

Steps in the Selling Process


LO6

Key Selling StepsTraditional

SellingRelationship

Selling

Generate Leads High Low

Qualify Leads Low High

Probe Needs Low High

Develop Solutions Low High

Handle Objections High Low

Close the sale High Low

Follow-up Low High

Time Spent in Key Steps of Selling Process


LO6

Advertising Publicity Direct Mail/Telemarketing

Cold Calling Internet Web Site Referrals

Trade Shows/ConventionsNetworking Company

Records

Generating Leads

Online

http://www.linkedin.comhttp://www.ryze.com

http://www.linkedin.com/

http://www.ryze.com/


Chapter 16

Cold Calling

LO6 Cold Calling

A form of lead generation in which the salesperson approaches potential buyers without any prior knowledge of the prospects’ needs or financial status.


Chapter 16

Recognized need

Buying power

Receptivity andaccessibility

LO6 Qualifying Leads


Chapter 16

NeedsAssessment

LO6 Needs Assessment

A determination of the customer’s specific needs and wants and the range of options a customer has for satisfying them.


LO6

Product or service

Customers

Competition

Industry

Salesperson must knoweverything

about...

The Consultative Salesperson

Online

http://www.hoovers.comhttp://www.dnb.com

http://www.hoovers.com/

http://www.dnb.com/


Chapter 16 LO6

Developing and Proposing Solutions

Sales Proposal

Sales Presentation


Chapter 16

LO6

Be well prepared

Use eye contact

Ask open-ended questions

Be poised

Use hand gestures and voice inflection

Focus on the customer needs

Incorporate visual elements

Know how to operate the A/V equipment

Make sure the equipment works

PRACTICE, PRACTICE, PRACTICE!

Powerful Presentations


Chapter 16LO6

View objections as requests for information Anticipate specific objections Investigate the objection with the customer Be aware of competitors’ products Stay calm Use the objection to close the sale

Handling Objections


Chapter 16

LO6 Closing the Sale

Negotiate

Keep an open mind

Look for customer signals

Tailor to each market


REVIEW LEARNING OUTCOMESteps in the Selling ProcessLO6


Chapter 16

Describe the functions of sales management

Sales ManagementLO7


Chapter 16

LO7

Evaluate sales force

Compensate and motivate sales force

Recruit and train sales force

Determine sales force structure

Define sales goals and sales process

Sales Management Responsibilities


LO7

Clear

Precise

Measurable

Time Specific

Defining Sales Goals

Sales VolumeMarket ShareProfit Level


Chapter 16

Quota

LO7

A statement of the individual salesperson’s sales objectives, usually based on sales volume alone but sometimes including key accounts, new accounts, repeat sales, and specific products.

Quota


Chapter 16

Sales Force StructureLO7

Individual client or account

Market or industry

Marketing function

Product line

Geographic region


Chapter 16

Traits of Top Sales PerformersLO7

Strong, healthy self esteem Can bounce back from rejection Sense of urgency and competitiveness Persuasive Assertive Sociable Willing to take risks Understand complex concepts Creative in developing solutions Possess empathy


LO7

Training includes...

Nonselling duties

Industry and customer characteristics

Product knowledge

Selling techniques

Company policies and practice

Training the Sales Force


Chapter 16

LO7 Compensating the Sales Force

Commission

Salary

CombinationPlans


Chapter 16

LO7

StraightCommission

The salesperson is paid some percentage when a sale is made.

StraightSalary

The salesperson receives a salary regardless of sales productivity.

Compensating the Sales Force


Chapter 16

Motivating the Sales ForceLO7

Ceremonies Plaques Vacations Merchandise Pay raises Cash bonuses Stock options Tuition assistance Product discounts

Rewards and incentives include:


Chapter 16

Key Personality Traits of Sales LeadersLO7

Effective Sales Leaders are…

Are assertive

Possess ego drive

Possess ego strength

Take risks

Are innovative

Have a sense of urgency

Are empathetic


Chapter 16

Evaluating the Sales ForceLO7

Contribution to profit

Calls per order

Sales or profits per call

Call percentage achieving goals

Sales volume


Chapter 16

Women in Car SalesLO7

SOURCE: Jennifer Saranow, “Car Dealers Recruit Saleswomen at the Mall,”

Wall Street Journal, April 12, 2006, B1.

For its Florida and Texas dealerships, Asbury Automotive Group is actively recruiting saleswomen– at shopping malls.

11% of the automotive sales force is female. In contrast, 50% of retail-industry employees are women.

Women influence 81% of new auto purchases, and women may even be better at selling cars than men.

Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 16 60

LO7

The Impact of Technology on Personal Selling

Cell phones

Laptops

Pagers

E-Mail

Electronic organizers

Internet


REVIEW LEARNING OUTCOME Functions of Sales ManagementLO7

sales promotion and personal selling

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