Bus169 Kotler Chapter 13

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  • 1. Sales Promotions & Personal Selling
  • 2. Sales Promotion
    • Sales promotion is the use of short-term incentives aimed at influencing consumer perception and behaviour to encourage early purchase of a product, and build market share through increased sales.
      • Sales promotion is a term that is closely linked with direct and digital marketing, but has its origins in FMCG.
      • Although sales promotion may mean different things in different organisations, it is generally agreed that they are value-adding tools aimed at encouraging early purchase .
      • Sales promotions cover a range of incentives that are used with products promoted via either mass media advertising, or by direct and digital methods.
  • 3. Purpose of
    • Sellers use sales promotions to :
      • encourage new ‘customers’ to try the product
      • take consumers away from competitors’ products
      • reward brand-loyal customers and retain them
      • reduce the time lapse between customer purchases
      • turn light users into medium or heavy users
    • Aim might also be to regain past purchasers who have stopped buying, or to discourage current users from buying a competitor’s product.
    • Potential new users fall into one of 3 groups: 
      • non-users; loyal users of another brand; brand switchers.
  • 4. Sales Promotion Tools
    • The main tools are:
      • Samples
      • Redeemable coupons
      • Cash-back offers
      • Cents-off deals/ price packs
      • Premium offers
      • Advertising specialties
      • Patronage rewards
      • Point-of-purchase promotions
      • Contests and games of chance/ skill
  • 5. Cont’d
    • Trade Promotion Tools
      • Incentives applied to the retail trade to stock and promote more of a product or to provide increased merchandising space, usually during a consumer promotion.
    • Business-to-Business Promotion Tools
      • Industrial marketers adapt many of the tools to suit their own situations, including the use of conventions; trade shows; sales contests.
  • 6. Developing Sales Promotion Programs
    • Several decisions must be made in order to define the full sales promotion program:
      • The size of the incentive to be offered.
      • How to promote and distribute the program.
      • The duration of the promotion.
      • How to evaluate the benefits achieved.
  • 7.
    • There are many types of personal selling jobs, and the role of personal selling can vary greatly from industry to industry; and from company to company.
    • The people who do the selling go by many names:
      • Salespeople
      • Sales representatives
      • Marketing representatives
      • Account executives/representatives
      • Sales consultants
      • Agents
      • District mangers
    Personal Selling
  • 8. Cont’d
    • Personal selling :
    • Can provide a detailed explanation or demonstration of a product and its benefits
    • Enables the marketing message to be modified to suit each specific selling situation
    • Is of most benefit when:
      • Fewer prospects are involved (e.g. B2B)
      • Marketing a higher value product
      • The product is ‘highly technical’
  • 9. The Role of the Salesforce
    • Personal selling is the interpersonal element of the promotion mix.
    • Advertising consists of one-way, non-personal communication with target consumer groups.
    • Personal selling involves two-way, personal communication between salespeople and individual customers, which can be:
      • face-to-face
      • by telephone
      • through video conference
      • or by other means
      • In complex selling situations, personal selling can be more effective than non-personal’ advertising .
  • 10. Cont’d
    • Sales people:
    • Serve as a critical link between a company and its customers
    • Represent the company to the customers
    • Represent the customers to the company
    • Are concerned with producing sales, but should also be concerned with delivering customer satisfaction while achieving profit
  • 11. Managing the Salesforce
    • Salesforce Management
      • The analysis; planning; implementation; and control of the salesforce activities.
      • This includes:
        • Setting objectives, and designing strategy
        • Recruiting; selecting; training; compensating; supervising; and evaluating the firm’s salesforce.
  • 12. Recruiting and Selecting Sales People
    • First and foremost in a successful selling operation is the selection of good salespeople.
    • Successful salespeople can come in all shapes and sizes, but the best share four key talents. They are:
      • Naturally motivated
      • Disciplined in their approach to work
      • Skilled in ‘closing’ a sale
      • Able to build relationships with customers
    • Generally the top performers are empathetic; patient; caring; responsive; good listeners; and honest.
  • 13.
    • Today, the average training period for a salesperson can be as short as four months.
    • Training programs have several goals.
    • Sales people need to:
      • know and identify with the company.
      • be familiar with the company’s products.
      • know customers’ and competitors’ characteristics.
      • know how to make effective presentations, and be trained in the principles of selling.
      • understand field procedures and responsibilities.
    Training Salespeople
  • 14. Compensating Salespeople
    • To attract the required salespeople, a company must have an attractive compensation plan.
    • The level of compensation must be close to the ‘going rate’ for the type of job and skills required.
    • Compensation can be made up of several elements
      • a fixed amount; a variable amount based on performance; an expense allowance; fringe benefits .
    • Management must decide what mix of these elements makes the most sense for each sales job.
  • 15. Supervising and Motivating Salespeople
    • New salespeople need supervision to help them ‘work smart’ and use their time efficiently.
    • Management can boost morale and performance through achievable sales quotas, and incentives
    • The appropriate motivation helps salespeople to work energetically towards agreed sales targets.
  • 16. How Salespeople might spend their time
  • 17. Evaluating Salespeople and Performance
    • Performance information about salespeople can be gathered from various sources:
      • Sales reports
      • Call reports
      • Expense reports
      • Personal observation
      • Customers’ letters/ complaints
      • Customer surveys
      • Other salespeople
  • 18. The Personal Selling Process
    • Steps in the Selling Process:
      • Prospecting
      • Pre-approach
      • Approach
      • Presentation and demonstration
      • Handling objections
      • Closing
      • Follow-up with customer
  • 19. Relationship Marketing
    • This is the process of creating, maintaining and enhancing strong, mutually beneficial relationships with customers and other stakeholders .
    • RM places an emphasis on building and maintaining profitable long-term relationships with customers by delivering superior customer value and satisfaction .
    • Many companies are realising that winning and retaining customers requires more than making good products and closing lots of sales .
    • It requires a carefully coordinated, total company effort to create value-laden, satisfying customer relationships.