Sales Techniques• Direct Selling• Pro Forma Sales• Agency Based sales• Request for Proposal• B2B
The Role of the Sales Force Represent the Company to Customers to Produce Company Profit Sales Force Serves as a Critical LinkBetween a Company and its Customers Since They: Represent Customers to the Company to Produce Customer Satisfaction
Steps in the Selling ProcessStep 1. Prospecting and Identifying and Screening ForQualifying Qualified Potential Customers. Learning As Much As PossibleStep 2. Pre-approach About a Prospective Customer Before Making a Sales Call. Knowing How to Meet the BuyerStep 3. Approach to Get the Relationship Off to a Good Start.Step 4. Presentation/ Telling the Product “Story” to the Buyer, and Showing theDemonstration Product Benefits.
Steps in the Selling Process Seeking Out, Clarifying,Step 5. Handling Objections and Overcoming Customer Objections to Buying.Step 6. Closing Asking the Customer for the Order.Step 7. Follow-Up Following Up After the Sale to Ensure Customer Satisfaction and Repeat Business.
DistributionP CR OO ND SU DISTRIBUTION UC ME ER R
Distribution’s Function• The major purpose of marketing is to satisfy human needs by delivering products of various types to buyers when and where they want them and at a reasonable cost.• The “when and where” is the function of Distribution
Distribution Objectives• Minimize total distribution costs for a given service output• Determine the target segments and the best channels for each segment• Objectives may vary with product characteristics o e.g. perishables, bulky products, non- standard items, products requiring installation & maintenance 12
What is a Distribution Channel?• A set of interdependent organizations (intermediaries) involved in the process of making a product or service available for use or consumption by the consumer or business user.• Marketing Channel decisions are among the most important decisions that management faces and will directly affect every other marketing decision.
Distribution Channel Functions Information Transfer Communication Payments Negotiation PhysicalDistribution Ordering Risk Taking Financing
Basic Channels of Distribution Manufacturers/products Agents/brokers Wholesalers/distributors Retailers Retailers Consumers and organizational end users 15
Typical Distribution of Drugs Manufacturers Marketing Agents ( Optional ) Retailers/Wholesalers/DistributorsPrivate GPs/specialists Group Procurement Office Retail Pharmacy Public Hospitals / Institutions Patient 16
Typical Distribution in FMCG Manufacturers Marketing Agents ( Optional ) Wholesalers/DistributorsRetail Chains like Big Unorganized retailers Bazaar etc. Public Canteens/ Government Purchase Consumer 17
Business-to-Business Channels Direct Wholesaler Agent
Conventional Distribution Channel vs. Vertical Marketing SystemsConventional Vertical marketing marketing channel channel ManufacturerManufacturer Wholesaler Wholesaler Retailer Retailer Consumer Consumer
Types of Vertical Marketing Systems Corporate Common Ownership at Different Levels of the Channel Administered Leadership is Assumed by One or a Few Dominant Members Contractual Contractual Agreement Among Channel Members
Vertical Marketing Systems• Corporate systems - total ownership• Contractual - legal relationships• Administered - strong leadership
Horizontal Marketing System• Joining of two or more corporations on the same level for the purposes of pursuing a new marketing opportunity.• Established to make use of combined resources• Produce synergistic effect for all the parties involves• Example: Nestle & Coke in Europe, FIAT in India
Planning the Channel of Distribution• Determining the structure o Marketing mix strategy o Organizational resources o External environmental factors o Market characteristics o Consumer preferences o Consumer behavior o The nature and availability of Intermediaries o Other environmental factors
Customers’ Desired Service Levels • Lot size • Waiting time • Spatial convenience • Product variety • Service backup
Steps: Distribution Planning
Choosing a Distribution System Intensive Distribution Exclusive Distribution Distribution Intensity Selective Distribution
Intensive Distribution Producer Seeks to obtain Retailer Retailer Retailer maximum productexposure at the retail Retailer Retailer Retailer level Retailer Retailer Retailer Retailer Retailer Retailer Retailer Retailer Retailer
Example of Intensive Distribution• Newspapers• Most fast moving consumer goods• Photo processing shops 29
Intensive Distribution• Advantages: o Increased sales, wider customer recognition, and impulse buying• Disadvantages: o Characteristically low price and low-margin products that require a fast turnover o Difficult to control large number of retailers 30
Selective Distribution ProducerProduct is sold in Retailer Retailer Retailer a limited number of Retailer Retailer Retailer outlets
Example of Selective DistributionDaewoo has 2 distributors in Singapore• “Starsauto, part of a larger Indonesian group, represents Daewoo’s traditional line of sedans.• Homegrown family-owned JTA Motors market Daewoo’s offroad vehicles like the Musso and Korando, and an upmarket model called the Chairman. 32
Selective Distribution• Advantages: o Better market coverage than exclusive distribution o More control and less cost than intensive distribution o Concentrate effort on few productive outlets o Selected firms capable of carrying full product line and provide the required service 33
Selective Distribution (cont’d)• Disadvantages: o May not cover the market adequately o Difficult to select dealers (retailers) that can match your requirement and goals 34
Exclusive Distribution ProducerProduct is sold inonly one outlet in a Retailer given area
Exclusive Distribution: Advantages• Maximize control over service level/output• Enhance product’s image & allow higher markups• Promotes dealers loyalty, better forecasting, better inventory and merchandising control• Restricts resellers from carrying competing brands 36
Exclusive Distribution: Disadvantages• Betting on one dealer in each market• Only suitable for high price, high margin, and low volume products 37
Multiple-Channel Strategy Using two or more different channels to distribute goods and services • Why ? o Permits optimal access to each market segment o Increase market coverage, lower channel cost and provide more customized selling • What to look out for ? o More channels usually means more conflict and control problems 38
Complementary ChannelsEach channel handles a product or segment that is different or non-competing e.g.• Toyota Lexus• Magazine distributions 39
Competitive ChannelsThe same product is sold through two different and competing channels e.g. o Non-prescriptive drugs o Electronic goods• Why ? To increase sales• What to look out for? o Over extending yourself o Dealers’ resentment o Control problems 40
Developing Distribution Tactics Selecting Channel Partners Managing the Channel of Distribution Channel Leader Power Reward or Economic Legitimate Coercive Power Power PowerDistribution Channels & the Marketing Mix
Physical Distribution Inventory Order Processing Control Received When to order Processed How much to order Shipped Physical Distribution Transportation Functions WarehousingRail, Water, Trucks, Number Needed Air, Pipeline, Where Internet What Type Materials Handling Moving Products Into, Within, and Out of Warehouses
Transportation Modes RailCost-effective for shipping bulk products, piggy-back, fishyback, birdyback. Water Low cost for shipping bulky, low-value, non perishable goods, slowest form. Truck Most important carrier for consumer goods, flexible. Air High cost, ideal when speed is needed or distant markets have to be reached Pipeline Carry petroleum based products, very low cost, requires little energy. Internet Web sites have products available, used especially for services.
Decision Making FrameworkProspects Importance of threatened channel inof terms of current or potential volumeDestructive or profitabilityConflict High LowHigh (FIRE) Act to avert or address Allow threatened conflict channel to declineLow Look for opportunities Do nothing(Smoke) to reassure threatened channel and leverage your power
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