Presentation for lecture 10

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Presentation for lecture 10

  1. 1. Chapter 12: Selling, Sales Promotion, and Public Relations
  2. 2. The Sales Function <ul><li>the sales function is responsible for selling products and services to customers, through the communication of information during customer interaction </li></ul><ul><li>it is a relatively high-cost form of promotion, often a firm’s largest single operating expense </li></ul><ul><li>there is more to a personal selling job than selling; often the job is to build a relationship; many sales people are now referred to as customer-services reps </li></ul><ul><li>personal selling is the most flexible promotional tool; can be tailored to the specific customer </li></ul>
  3. 3. Sales is Most Effective When… <ul><li>the sales function is more likely to be dominant when: </li></ul><ul><ul><li>the market is concentrated geographically </li></ul></ul><ul><ul><li>product value is not readily apparent </li></ul></ul><ul><ul><li>the product has high unit value. is technically, or requires much explanation </li></ul></ul><ul><ul><li>the product must be tailored to a customer </li></ul></ul><ul><ul><li>the sale involves a trade-in </li></ul></ul><ul><ul><li>the product is at the introductory stage of its life cycle </li></ul></ul><ul><ul><li>the firm has a small budget for advertising </li></ul></ul>
  4. 4. Scope of the Sales Function <ul><li>there are many types of sales jobs </li></ul><ul><li>retailing involves inside selling ; these jobs may involve proactive selling or reactive selling </li></ul><ul><li>outside sales persons go to the customer; there is usually some opportunity for creative selling and addressing customer needs </li></ul><ul><li>electronic selling through telemarketing is a relatively new development which combines with databases to better target customers </li></ul>
  5. 5. Figure 12-1 Scope of the Sales Function
  6. 6. The New Focus of Selling <ul><li>“selling” may be a misleading term; often there is no selling involved – sales personnel are providing service and building relationships </li></ul><ul><li>because of their interpersonal contact with the customer, sales people influence the image of the firm </li></ul><ul><li>they provide a valuable service role , and ideally become the customer’s trusted partner </li></ul>
  7. 7. The Nature of Sales Jobs <ul><li>many sales reps are now professional sales persons with complete responsibility for relations with their customers </li></ul><ul><li>there is often considerable opportunity for role conflict and role ambiguity </li></ul><ul><li>there is a wide variety of sales jobs from delivery drivers to creative sales engineers </li></ul><ul><li>the sales staff is the front line and represents the firm to its customers </li></ul>
  8. 8. Changing Patterns in Sales <ul><li>the nature of the selling job is changing, reflecting changing market situations </li></ul><ul><li>many firms have organized sales teams </li></ul><ul><li>others now offer their customers a coordinated systems and solutions for their problems </li></ul><ul><li>there is considerable emphasis today on the development of relationships with customers </li></ul><ul><li>technology has changed the way many firms sell, relying on telemarketing and the Internet </li></ul>
  9. 9. Relationship Selling <ul><li>high levels of trust are important </li></ul><ul><li>buyer must demonstrate trust in the salesperson as well as the selling organization </li></ul><ul><li>trusted salespeople can retain the buyer’s commitment even in the face of policies that may not be considered satisfactory </li></ul><ul><li>sales people have a major role in the management of customer relationships </li></ul>
  10. 10. The Sales Process <ul><li>many firms follow a predictable sales pattern </li></ul><ul><li>prospecting involves the identification of prospects from various sources </li></ul><ul><li>qualifying the prospect determines the willingness and capability to buy </li></ul><ul><li>presenting the sales message (attract attention, hold interest, stimulate desire, close the sale) </li></ul><ul><li>there is often a need to serve customers after the sale to ensure their satisfaction </li></ul>
  11. 11. Figure 12-2 The Personal Selling Process
  12. 12. Staffing/Operating a Sales Force <ul><li>staffing is a critical sales-force decision: must ensure that staff have necessary qualifications </li></ul><ul><li>the firm needs a system to generate applicants </li></ul><ul><li>recruitment often involves extensive screening </li></ul><ul><li>extensive sales force training is often needed </li></ul><ul><li>the sales force must be supervised and managed </li></ul><ul><li>their performance has to be evaluated; compensation systems must be put in place </li></ul>
  13. 13. Figure 12-3 Staffing and Operating a Sales Force
  14. 14. Evaluating Sales Performance <ul><li>a system must exist to evaluate performance </li></ul><ul><li>serves as the basis for training programs and for determining appropriate rewards </li></ul><ul><li>quantitative bases for performance review include sales generated, number of orders, closing rate, number of calls made </li></ul><ul><li>qualitative bases include product knowledge, preparedness for calls, success in establishing relationships, appearance, and attitude </li></ul>
  15. 15. Sales Promotion <ul><li>sales promotions stimulate short-term sales through non-advertising means; coupons, contests, samples, displays, premiums, trade shows </li></ul><ul><li>may be directed at end consumers ( consumer promotions ) or at intermediaries ( trade promotions ) or a firm’s sales force </li></ul><ul><li>sales promotions are short-term in orientation and tactical in achieving certain objectives </li></ul><ul><li>it may be easier to evaluate the effectiveness of sales promotions than it is for advertising </li></ul>
  16. 16. Public Relations <ul><li>public relations is intended to develop and maintain a positive public image for a firm </li></ul><ul><li>objective is to maintain good relations with a number of “publics”; this may be achieved by generating positive publicity </li></ul><ul><li>publicity is usually considered to be a “news item” that appears about a specific company </li></ul><ul><li>positive publicity is achieved through press releases, press conferences, and events </li></ul>
  17. 17. Chapter 13: Retailing
  18. 18. Figure 13-1 Total Retail Trade in Canada, Selected Years
  19. 19. Retailing <ul><li>retailing involves the sale of products and services to end consumers for their personal non-business use </li></ul><ul><li>not all sales by retailers are retail sales. why? </li></ul><ul><li>similarly, not all retailing is done by retailers </li></ul><ul><li>most of the retailers of Canada are very small </li></ul><ul><li>there is considerable concentration in retailing, accounted for by the large chains </li></ul><ul><li>many small retailers join contractual vertical marketing systems to increase their competitiveness </li></ul>
  20. 20. Physical Facilities of Retailers <ul><li>most retailers operate from stores, although more now engage in nonstore retailing </li></ul><ul><li>those that operate stores must consider where to locate their stores, how to design them, and what physical layout to use </li></ul><ul><li>much retailing in Canada is concentrated in shopping centres which range in size from small neighbourhood convenience centres to very large regional centres </li></ul>
  21. 21. Forms of Retailing <ul><li>most retailers are independents </li></ul><ul><li>corporate chains are centrally owned and managed which means that individual stores have relatively little autonomy </li></ul><ul><li>chains can generally offer their customers lower prices because of a lower cost structure </li></ul><ul><li>they spread their risk and exposure over a larger number of stores; they can experiment and gain economies of scale in advertising </li></ul><ul><li>however, they tend to be quite standardized </li></ul>
  22. 22. Franchising and Other VMS <ul><li>retail co-operatives and voluntary chains offer retailers increased buying power and the benefits of management and marketing support </li></ul><ul><li>product and trade name franchising allows a retailer to use the franchisor’s trade name for promotional purposes; focus is on what is sold </li></ul><ul><li>in business format franchising , a firm with a track record sells the right to operate identical businesses; focus is on how the business is run </li></ul>
  23. 23. Major Types of Retailers <ul><li>department stores offer a wide variety of mechandise and services and don’t compete on the basis of price; they are facing intense competition and high operating costs </li></ul><ul><li>discount houses are large-scale chain retailers that offer a wide range of products but less depth; they offer low prices and fewer services and have succeeded in keeping costs low through use of technology </li></ul>
  24. 24. Limited-line Retailers <ul><li>limited-line retailers offer customers less selection, but great depth within their lines </li></ul><ul><li>specialty stores carry a very narrow product line, usually specializing in a single category </li></ul><ul><li>off-price retailers offer a deep assortment in a narrow line, low prices, and few services; these include factory outlets </li></ul><ul><li>category-killer stores offer a very wide variety and low prices; dominate the category </li></ul>
  25. 25. Other Forms of Retailing <ul><li>many of the established retailers are moving toward new forms of distribution, including telephone and Internet shopping </li></ul><ul><li>supermarket retailing has extended with the opening of superstores and combination stores </li></ul><ul><li>convenience stores are open 24 hours </li></ul><ul><li>warehouse club chains have made a major entry into Canada in recent years; they offer a wide breadth of products, but little depth </li></ul>
  26. 26. Nonstore Retailing <ul><li>there has been considerable growth in nonstore retailing with advancing technology and changing consumer shopping preferences </li></ul><ul><li>direct selling avoids using intermediaries </li></ul><ul><li>telemarketing uses sales people on the phone to sell products and services </li></ul><ul><li>direct marketing uses catalogues, direct mail, television shopping, and the Internet </li></ul><ul><li>many products and services are now sold through vending machines </li></ul>
  27. 27. Online Retailing <ul><li>more and more companies are selling directly to consumers over the Internet </li></ul><ul><li>those that operate only online have struggled to become profitable; those that also have a physical stores are more likely successful </li></ul><ul><li>shopping-cart abandonment is high; challenge to turn browsers into buyers </li></ul>
  28. 28. Retailing Management <ul><li>in a competitive market, positioning of retailers is a challenge </li></ul><ul><li>in many retail operations, managing through seasonal and fashion cycles is necessary </li></ul><ul><li>through technology, retailers will have access to considerable volumes of information; improved productivity will be one result </li></ul><ul><li>retailers will place greater emphasis on convenience, customer service, and customer retention </li></ul>
  29. 29. Managing Retail Assortments <ul><li>Style and Fashion </li></ul><ul><ul><li>Style: a distinctive presentation or construction of any art, product, or activity. </li></ul></ul><ul><ul><li>Fashion: A style that is popularly accepted by groups of people over a reasonably long period of time. </li></ul></ul><ul><li>Fashion-adoption process </li></ul><ul><ul><li>Large or small group influences of buying decisions. </li></ul></ul><ul><ul><li>Diffusion of innovation. </li></ul></ul>
  30. 30. Figure 13-2 Fashion-Adoption Processes
  31. 31. Next Class <ul><li>Supply System (Chapter 14). </li></ul><ul><li>Review for the final exam. </li></ul>

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