... UnitUnitUnitUnit12:12:12:12: Public Public Public Public Relations, Relations, Relations, Relations, SalesSalesSalesSales Promotion, Promotion, Promotion, Promotion, and and and andPersonalPersonalPersonalPersonalSellingSellingSellingSelling Public Public Public Public Relations Relations Relations Relations and and and andPublicity:Publicity:Publicity:Publicity: Public Public Public Public relations relations relations relationsisanorganization’scommunicationsthatseektobuildgoodrelationshipswithanorganization’spublics,includingconsumers,stockholders, and legislators.Itincludesobtainingfavorablepublicity,buildingupagood“corporateimage,” and handlingorheadingoffunfavorablerumors,stories, and events.PublicityPublicityPublicityPublicityisunpaidcommunicationaboutanorganizationthatappearsinthemassmedia. Public relations mayconsistofwriting press releases,holdingspecialevents,conducting and publishingconsumersurveysaboutaproductorthecompany, and effortstoputapositivespinonnegativecompanynews.Unlikesalespromotions, public relations activitiesdonotusuallyseekashort-termincreaseinsales.Instead,theytrytocraftalong-termpositiveimage for theproductortheorganization.Comparedwithpersonalselling,advertising, and salespromotions,expenditures for public relations areusuallylowinmostorganizations.Sincecompaniesdonotpay for publicity,theyhavelesscontroloverthepublicationofgoodorbadcompanynews.Butthisoftenmeansthatconsumersfindthistypeofnewssourcemorebelievablethaniftheinformationweredisseminateddirectlybythecompany.MarketingMarketingMarketingMarketing and and and andNonmarketingNonmarketingNonmarketingNonmarketing Public Public Public Public Relations: Relations: Relations: Relations: Thebasicruleof public relations istodosomethinggood and thentalkaboutit. Public relations iscrucialtoanorganization’sabilitytoestablish and maintainafavorableimage.NonmarketingNonmarketingNonmarketingNonmarketing public public public public relations relations relations relationsreferstoacompany’smessagesaboutgeneralmanagementissues.Whenacompanymakesadecisionthataffectsanyofitspublics,inputfrom public relations specialistscanhelptosmoothitsdealingswiththosepublics.Acompany, for example,thatdecidestocloseaplantwouldneedadviceonhowtodealwiththelocalcommunity.Otherexamplesincludeacompany’sattemptstogainfavorable public opinionduringalongstrikeoranopenlettertoCongresspublishedinanewspaperduringcongressionaldebatesonabillthatwouldaffectaparticularindustry.MarketingMarketingMarketingMarketing public public public public relations relations relations relationsreferstonarrowlyfocused public relations activitiesthatdirectlysupportmarketinggoals.Marketing public relations involvesanorganization’srelationshipswithconsumersorAllowancesAnallowanceallowanceallowanceallowanceispromotionalmoneypaidbymanufacturerstoretailersinreturn for anagreementtofeaturethemanufacturer’sproductsinsomeway.Anadvertisingallowancecompensatesretailers for advertisingtheproduct.Adisplayallowancecompensatesthem for usingspecialdisplays.Conventions and TradeShowsManycompanies and tradeassociationsorganizeconventions and tradeshowstopromotetheirproducts.Firmssellingtotheindustryshowtheirproductsatthetradetradetradetradeshowshowshowshow.Atradetradetradetradeshowshowshowshowisan event atwhichmanycompaniessetupelaborateexhibitstoshowtheirproducts,giveawaysamples,distributeproductliterature, and troll for newbusinesscontacts.Tradeshowsaremajorvehicles for manufacturerstoshowofftheirproductlinestowholesalers and retailers.Morethan4,300tradeshowstakeplaceeveryyear,drawingasmanyas85millionpeople.Vendorsreceivemanybenefits,suchasopportunitiestofindnewsalesleads,contactcustomers,introducenewproducts,meetnewcustomers,sellmoretopresentcustomers, and educatecustomerswithpublications and audiovisualmaterials.Tradeshowsalsohelpcompaniesreachmanyprospectsnotreachedthroughtheirsalesforces.About90percentofatradeshow’svisitorsseeacompany’ssalespeople for thefirsttimeattheshow.Businessmarketersmayspendasmuchas35percentoftheirannual promotion budgetsontradeshows.OtherProgramsManufacturersmayofferfreefreefreefreegoodsgoodsgoodsgoods,whichareextracasesofmerchandise,toresellerswhobuyacertainquantityorwhofeatureacertainflavororsize.Theymayofferpushpushpushpushmoneymoneymoneymoney—cashorgiftstodealersortheirsalesforcesto“push”themanufacturer’sgoods.Mostretailersalsochargemanufacturersslottingslottingslottingslottingfeesfeesfeesfees—paymentsdemandedbyretailersbeforetheywillacceptnewproducts and find“slots” for themontheshelves.Manufacturersmayalsogiveretailersfreespecialtyspecialtyspecialtyspecialtyadvertisingadvertisingadvertisingadvertisingitemsitemsitemsitemsthatcarrythecompany’sname,suchaspens,pencils,calendars,paperweights,matchbooks,memopads, and yardsticks. For moreexpensive and highlycomplexproducts,manufacturersoftenprovidespecializedspecializedspecializedspecializedtrainingtrainingtrainingtraining for retailsalespeople.Thisbackgroundhelpssalespeopleexplainfeatures,competitiveadvantages, and otherinformationtoconsumers.Trainingcanbeprovidedinseveralways:Amanufacturer’ssalesrepresentativecanconducttrainingsessionsduringregularsalescalls,orthefirmcandistributesalesliterature and videocassettes.SalesSalesSalesSalesForceForceForceForce Promotion: Promotion: Promotion: Promotion: Salesforce promotion isdirectedatthecompany’sownsalesforce(oftentimesthemanufacturer’ssalesforce)—ratherthanabusinesscustomer’ssalesforcewhichisinthedistributionchannel,suchasaretailer’ssalesforce.Contests, for example,couldbeusedtourgethesalesforcetoincreasetheirefforts,withprizesgoingtothetopperformers.Asalessalessalessalescontestcontestcontestcontestisacontest for salespeopletomotivatethemtoincreasetheirsalesperformanceoveragivenperiod.Salescontestsmotivate and recognizegoodcompanyperformers,whomayreceivetrips,cashprizes,orothergifts.Salescontestsworkbestwhentheyaretiedtomeasurable and achievablesalesobjectives.Otherincentivescouldalsobeprovidedtoencouragethesalesforcetoincreasenewaccountsinadditiontoboostingsales.PersonalPersonalPersonalPersonalSelling:Selling:Selling:Selling:PersonalPersonalPersonalPersonalsellingsellingsellingsellingispromotionalpresentationbythefirm’ssalesforceconductedonaperson-to-personbasiswiththebuyer for thepurposeofmakingsales and buildingcustomerrelationships.Personalsellingistheoldestformof promotion. Thisdirectformof promotion maybeconductedface-to-face,overthetelephone,throughvideoconferencing,orthroughinteractivecomputerlinksbetweenthebuyer and theseller.Thisdirectcontactwiththecustomergivesthesalespersontheopportunitytobeflexible and modifythesalesmessagetocoincidewiththecustomer’sneeds.Thesalespersoncangetimmediatefeedbackfromthecustomer.Thisformof promotion hasahighcostpercontactwiththecustomer.Theaveragesalescallcostsabout$300.Itisdifficulttoensureconsistencyofmessagewhenitisdeliveredbymanydifferentcompanyrepresentatives.Thecredibilityofsalespeopleoftendependsonthequalityoftheircompany’simage,whichhasbeencreatedbyother promotion strategies.About14millionpeopleintheU.S.areemployedinpersonalselling.Today,mostsalespeoplearewell-educated,well-trainedprofessionalswhoworktobuild and maintainlong-termcustomerrelationshipsbylisteningtotheircustomers,assessingcustomerneeds, and organizingthecompany’seffortstosolvecustomerproblems.Thetermsalespersoncoversawiderangeofpositions.Atoneextreme,asalespersonmightbelargelyanordertaker,suchasadepartmentstoresalespersonstandingbehindacounter.Attheotherextremeareordergetters,whosepositionsdemandthecreativesellingofproductsrangingfromappliances,industrialequipment, and airplanestoinsurance,advertising, and informationtechnologyservices.TheTheTheTheRoleRoleRoleRoleofofofofPersonalPersonalPersonalPersonalSelling:Selling:Selling:Selling:Generally,apersonalsaleseffortismoreimportantwhenafirmengagesinapushstrategy,inwhichthegoalistopushtheproductthroughthedistributionchannelsothatitisavailabletoconsumers.PersonalsellingalsoislikelytobecrucialinB2Bcontextswhendirectinteractionwithupper-levelmanagementisrequiredtosecureanimportantsale— and oftenwhenintensepricenegotiationsoccurbeforethesaleismade.Inaddition,inexperiencedbuyersmayneedthehands-onassistancethataprofessionalsalespersoncanprovide.Firmssellingproductsthatconsumersbuyinfrequently,suchascomputers,lawnmowers, and collegeeducations,oftenrelyheavilyonpersonalselling,asdofirmssellingcomplexorveryexpensiveproductsthatneedasalespersontoexplain,justify, and sellthem.Personalselling,however,hassomedisadvantagesthatlimittheroleplayedbypersonalsellinginthe promotion mix.First,whenthedollaramountofindividualpurchasesislow,itisn’teconomicallyfeasibletousepersonalselling.Thecostpercontactwithacustomerishighcomparedtootherformsofcommunication,suchasadvertising.Salespeoplecanalsoonlymakealimitednumberofsalescallsaday.Relianceonpersonalsellingiseffectiveonlywhenthesuccessratioisatitshighest.Becausethecostofutilizingsalespeopleishigh,telemarketingisgrowinginpopularity.Thetypesofsalespeople and theirfunctionsvaryconsiderably.Thepersonwhoprocessesacomputerpurchaseoverthephoneisanorderorderorderordertakertakertakertaker,asalespersonwhoseprimaryfunctionistofacilitatetransactionsthatthecustomerinitiates.Ordertakersincludebothinside and outsidesalespeople.Mostretailsalespeopleareinsideordertakers,butoftenwholesalers,dealers, and distributorsemploysalespeopletowaitoncustomers.Incontrast,acomputertechnicianisatechnicaltechnicaltechnicaltechnicalspecialistspecialistspecialistspecialist,asalessupportpersonwithahighleveloftechnicalexpertisewhoassistsinproductdemonstrations,recommendations for complexequipment, and setupofmachinery.Thetechnicalspecialist’sjobistoprovidesalessupportratherthanactuallyclosingthesale.Thetechnicalspecialistpromotesthefirm and triestostimulatedemand for aproducttomakeiteasier for colleaguestoactuallymakethesale.Sometimesapersonwhosejobistolaythegroundworkisknownasamissionarymissionarymissionarymissionarysalespersonsalespersonsalespersonsalesperson.Thisisasalespersonwhopromotesthefirm and triestostimulatedemand for aproduct,butdoesnotactuallycompleteasale.Manyfirmsfindthatthesellingfunctionisbesthandledbyteamteamteamteamsellingsellingsellingselling,usingteamsofpeoplefromsales,marketing,engineering,finance,technicalsupport, and evenuppermanagementtoservicelarge,complexaccounts.Finally,thepersonwhoactuallyconvincesthecustomertobuyisanorderorderorderordergettergettergettergetter,asalespersonwhoworkscreativelytodeveloprelationshipswithcustomersortogeneratenewsales.ApproachesApproachesApproachesApproachestotototoPersonalPersonalPersonalPersonalSelling:Selling:Selling:Selling:Personalsellingisoneoftheoldestformsof promotion, butitsimagehasbeentarnishedbysmooth-talkingpitchmenwhohavesometimessaidanythingtomakeasale.Inmorerecentyears,personalsellinghasbeguntoredeemitselfasaprofession and hasmovedfromatransactional,hard-selltechniquetoarelationshipmarketingapproach.TransactionalMarketingThehardsellisahigh-pressureprocess.Hard-selltacticsareaformoftransactionaltransactionaltransactionaltransactionalsellingsellingsellingselling,aformofpersonalsellingthatfocusesonmakinganimmediatesalewithlittleornoattempttodeveloparelationshipwiththecustomer.Ascustomers,thehardsellmakesusfeelmanipulated and resentful.Thistechniquealsocontributestothenegativeimagemanyofushaveofobnoxioussalespeople.RelationshipMarketingToday’sprofessionalsalespersonismorelikelytopracticerelationshiprelationshiprelationshiprelationshipsellingsellingsellingselling,aformofpersonalsellinginwhichthesalespersonseekstodevelopamutuallysatisfyingrelationshipwiththeconsumer.Relationshipsellinginvolveswinning,keeping, and developingcustomers.Winningacustomermeansconvertinganinterestedprospectintosomeonewhoisconvincedthattheproductholdsvalue for himorher.Keepingacustomermeansensuringthatthecustomergetswhatheorshepaid for. Developingacustomermeanssatisfyingthecustomersothatheorshewillbecountedontoprovidefuturebusiness.Theprofessionalsalespersonwhogenuinelyadherestotheprinciplesofrelationshipmarketingisarelationshipbuilder and acustomerproblemsolver.TheTheTheTheCreativeCreativeCreativeCreativeSellingSellingSellingSellingProcess:Process:Process:Process:Sellingisseldomboring.Everycustomer,everysalescall, and everysalespersonareunique.Somesalespeoplearesuccessfulprimarilybecausetheyknowsomuchaboutwhattheysell.Othersaresuccessfulbecausetheyhavebuiltstrongrelationshipswithcustomerswholookforwardtotheirvisits.Mostsalespeopleunderstand and engageinaseriesofactivitiesnecessarytobringaboutatransaction.Complexorexpensivesalesrequirecarefulplanning, and successfulsellinginthesecasesismorelikelyifthesalespersonundergoesasystematicseriesofstepsknownasthecreativecreativecreativecreativesellingsellingsellingsellingprocessprocessprocessprocess.Thesestepsrequirethesalespersontoseekoutcustomers,analyzetheirneeds,determinehowproductattributesprovidebenefits, and thendecidehowbesttocommunicatethistotheprospects.Thestepsintheprocessincludeprospecting,qualifying,preapproach,approach,salespresentation,demonstration,handlingobjections,closing, and follow-up.ProspectingProspectingProspectingProspectingProspectingisthestepofthesellingprocessthatincludesidentifying and developingalistofpotentialorprospectivecustomers.Prospectsorsalesleadscancomefromexistingcustomerlists,telephonedirectories,orcommerciallyavailabledatabases.Sometimescompaniesgeneratesalesleadsthroughtheiradvertisingorsalespromotionsbylettingcustomersrequestmoreinformation.Onewaytogenerateleadsisthroughcoldcalling,whenthesalespersoncontactsprospectswithoutpriorintroductionorarrangement.Salespeoplealsorelyonreferrals.Currentclientswhoaresatisfiedwiththeirpurchaseoftengivereferrals.QualifyingSalespeoplenextneedtoqualifyqualifyqualifyqualifytheirprospectsprospectsprospectsprospects,thestepofthesellingprocessthatdetermineshowlikelyprospectsaretobecomecustomers.Prospectscanbequalifiedbylookingattheirfinancialability,volumeofbusiness,specialneeds,location, and possibilities for growth.PreapproachThepreapproachpreapproachpreapproachpreapproachisthestepinthesellingprocessinwhichthesalespersonlearnsasmuchaspossibleaboutaprospectivecustomerbeforemakingasalescall.Salespeopletrytolearnasmuchaspossibleaboutqualifiedprospectsearlyon.Theymayprobepriorpurchasehistory,currentneeds,orinformationabouttheirinterests.Thesalespersoncanconsultindustry and onlinesources,acquaintances,etc.tolearnabouttheprospect.Anothertaskistodecideonthebestapproach,whichmightbeapersonalvisit,aphonecall,oraletter.Thebesttimingshouldbeconsideredcarefullybecausemanyprospectsarebusiestatcertaintimes.Finally,thesalespersonshouldgivethoughttoanoverallsalesstrategy for theaccount.ApproachTheapproachapproachapproachapproachisthestepinthesellingprocessinwhichthesalespersonusuallymeetsthecustomer for thefirsttime.Heorsheshouldstartbuildingtherelationshipduringtheapproach.Thesalespersonshouldknowhowtomeet and greettheprospect and gettherelationshipofftoagoodstart.Thisstepinvolvesthesalesperson’sappearance,openinglines, and thefollow-upremarks.Theopeninglinesshouldbepositivetobuildgoodwillfromthebeginningoftherelationship.Ifthesalespersonmadecontactwiththeprospectthroughareferral,thesalespersonshouldprobablysaysoup-front.Thisopeningmightbefollowedbysomekeyquestionstolearnmoreaboutthecustomer’sneedsorbyshowingadisplayorsampletoattracttheprospect’sattention and curiosity.Asinallstagesofthesellingprocess,listeningtothecustomeriscrucial.SalesPresentationThesalessalessalessalespresentationpresentationpresentationpresentationisthestepinthesellingprocessinwhichthesalespersonseekstopersuasivelycommunicatetheproduct’sfeatures and thebenefitsitwillprovideafterthesale.Proofstatements,suchasdataonpastsales,testimonials,guarantees,orresearchresults,helptomakethesalesperson’spresentationcredible.Somesalespresentationsarecanned,meaningascripthasbeenwritteninadvance, and thesamemessageisdeliveredtomanyprospects.Thistechniqueoftenprovidesaseriesofverbalpromptstowhichthereareexpectedcustomerresponses.Asimilarapproachcalledaformulatedapproachidentifiesaprospect’sneeds and thenprovidesascriptedsalespitchkeyedtothatkindofprospect.Thesestandardizedapproachesworkfineinsomecases,butthemosteffectivesalespresentationsarethosethataretailoredtothespecificcustomer.Increasingly,salespresentationsaregoinghigh-tech.Computer-basedmultimediapresentationsareconsideredthenextwaveinsales-forceautomation.Withamultimedia-readynotebookcomputerorLCDprojectioncomputer,salespeoplecanbringcolor,animation,video,audio, and interactivity—aswellasthelatestproduct and pricinginformation—totheirpresentations.DemonstrationOneimportantadvantageofpersonalsellingovermostadvertisingistheabilityofsalespeopletoprovideademonstrationdemonstrationdemonstrationdemonstrationoftheproducttothepotentialbuyer.Manyfirmsusenewtechnologiestomaketheirdemonstrationsmoreeffective.Multimediainteractivedemonstrationsarenowcommon.Thekeytoagooddemonstration—onethatgainsthecustomer’sattention,keepshisorherinterest,isconvincing, and staysinthecustomer’smemory—isplanning.Thesalespersonshouldcheck and recheckallaspectsofthedemonstrationpriortoitsdelivery.HandlingObjectionsHandlingHandlingHandlingHandlingobjectionsobjectionsobjectionsobjectionsisthestepinthesellingprocessinwhichthesalespersonseeksout,clarifies, and overcomescustomerobjectionstobuying.Customersalmostalwayshaveobjectionsduringthepresentationorwhenaskedtoplaceanorder.Theproblemcanbeeitherlogicalorpsychological, and objectionsareoftentimesunspoken.Thesalespersonshouldhandleobjectionsusingapositiveapproach,byseekingouthiddenobjections,askingtheprospecttoclarifyanyobjections, and takingobjectionsasopportunitiestoprovidemoreinformation—turningtheobjectionsintoreasons for buying.Everysalespersonneedstrainingintheskillsofhandlingobjections.ClosingClosingClosingClosingClosingisthestepinthesellingprocessinwhichthesalespersonasksthecustomer for anorder.Somesalespeopledonotgetaroundtoclosingordonothandleitwell.Theymaylackconfidence,feelguiltyaboutasking for theorder,orfailtorecognizetherightmomenttoclosethesale.Salespeopleshouldknowhowtorecognizeclosingsignalsfromthebuyer,includingbodylanguage,comments, and questions.Salespeoplecanuseseveralclosingtechniques.Theycanask for theorder,reviewpointsofagreement,offertohelpwriteuptheorder,askwhethertheybuyerwantsthismodelorthatone,ornotethatthebuyerwillloseoutiftheorderisnotplacednow.Thesalespersonmayalsoofferthebuyerspecialreasonstoclose,suchasalowerpriceoranextraquantityatnocharge.Follow-UpFollow-upFollow-upFollow-upFollow-upisthelaststepinthesellingprocess,inwhichthesalespersonfollowsupafterthesaletoensurecustomersatisfaction and repeatbusiness.Rightafterclosing,thesalespersonshouldcompleteanydetailsondeliverytime,purchaseterms, and othermatters.Thesalespersonthenshouldscheduleafollow-upcallwhentheinitialorderisreceived,tomakesurethereisproperinstallation,instruction, and/ orservicing.Thisvisitshouldrevealanyproblems,assurethebuyerofthesalesperson’sinterest, and reduceanybuyerconcernsthatmighthavearisensincethesale.Follow-upalsoallowsthesalespersontobridgetothenextpurchase.Oncearelationshipdevelops,thesellingprocessisonlythebeginning.Evenasonecycleofpurchasingdrawstoaclose,agoodsalespersonisalreadylayingthefoundation for thenextone.SalesSalesSalesSalesManagement:Management:Management:Management:SalesSalesSalesSalesmanagementmanagementmanagementmanagementistheprocessofplanning,implementing, and controllingthepersonalsellingfunctionofanorganization.Personalsellingisateameffortthatrequirescarefulplanning and salespeopleinthefieldwhen and wherecustomersneedthem.SalesForceObjectivesSalesforceobjectivesstatewhatthesalesforceisexpectedtoaccomplish and when.Thesegoalscouldincludeacquiringnewcustomers,generatingspecificamountsofsalesvolume,reducingsalesexpenses,improvingcustomersatisfaction,gatheringnew-productsuggestions,traininggoals, and communityinvolvementgoals.Salesmanagersalsoworkwiththeirsalespeopletodevelopindividualgoals.Performancegoalsaremeasurableoutcomes,suchastotalsales and totalprofitspersalesperson.Behavioralgoalsspecifyactionssalespeoplemustaccomplish,suchasthenumberofprospectstoidentify,thenumberofsalescalls, and thenumberofsalespresentations.SalesForceStrategyAsalesforcestrategyspecifiesthestructure and sizeofafirm’ssalesforce.Eachsalespersonhastheresponsibility for asetgroupofcustomers—thesalessalessalessalesterritoryterritoryterritoryterritory.Theterritorystructureallowssalespeopletohaveanin-depthunderstandingofcustomers and theirneedsthroughfrequentcontacts.Themostcommonwaytoallotterritoriesisgeographically,minimizingtravel and otherfieldexpenses.Ageographicsalesforcestructureusuallyissizedaccordingtohowmanycustomersarefoundinagivenarea.Iftheproductlineisdiverseortechnicallycomplex,abetterapproachmaybetostructuresalesterritoriesbasedondifferentclassesofproductstoenablethesalesforcetoprovidemoreexpertisetoasetofcustomerswithsimilarneeds.Stillanotherstructureisindustryspecialization,inwhichsalespeoplefocusonasingleindustryorasmallnumberofindustries.Puttingasalespersonintothefieldisexpensive,sothenumberofpeopleinthesalesforcehasanimpactonacompany’sprofitability.Determiningtheoptimalnumberofsalespeopleisanimportantdecision.Recruiting,Selecting,&TrainingtheSalesForceBecausethequalityofasalesforcecanmakeorbreakafirm,atoppriority for salesmanagersistorecruit and selecttherightsetofpeopletodothejob—peoplewhoarestrategicthinkers,whohavetechnicalknowledgepertainingtotheindustry, and whohaveexcellentinterpersonalskills.Companiesscreenpotentialsalespeopletorevealtheseskills,alongwithusefulinformationaboutinterests and capabilities.Pencil -and- papertestscandeterminequantitativeskills and competenceinareasnoteasilyevaluatedthroughinterviews.Salestrainingteachessalespeopleabouttheorganization and itsproducts and howtodeveloptherightskills,knowledge, and attitudes.Newsalespeoplemayspendanywherefromafewweeksormonthstoayearormoreintraining.Theaverageinitialtrainingperiodisfourmonths.Then,mostcompaniesprovidecontinuingsalestrainingviaseminars,salesmeetings, and theInternetthroughoutthesalesperson’scareer.Compensating,Motivating, and SupervisingtheSalesForceOnewaytomotivatesalespeopleistopaythemwell,oftentimesbytyingcompensationtoperformance.Astraightcommissionplanisbasedsolelyonapercentageofsalesthepersoncloses.Underacommission-with-drawplan,earningsarebasedoncommissionplusaregularpayment,or“draw,”thatmaybechargedagainstfuturecommissionsifcurrentsalesareinadequatetocoverthedraw.Withastraightsalarycompensationplan,thesalespersonispaidasetamountregardlessofsalesperformance.Sometimesstraightsalaryplansareaugmentedbyuseofaquota-bonusplan,inwhichsalespeoplearepaidsalaryplusabonus for salesaboveanassignedquota.Inadditiontobasiccompensation,manymanagersfindthatavarietyofotherincentivescanalsoenhancethesalesforceefforttremendously.Suchincentivescanrangefromfreevacationstoextracash.Althoughmanysalespeopleliketoworkindependently,supervisionisessentialtoaneffectivesalesforce.Salesmanagersoftenrequiresalespeopletodevelopmonthly,weekly,ordailycallreports,aplanofactiondetailingwhichcustomerswerecalledon and howthingswent.Thesereportsallowthesalesmanagertotrackwhatthesalespeoplearedoinginthefield, and theyprovidemarketingmanagerswithtimelyinformationaboutcustomers’responses,competitiveactivity, and anychangesinthefirm’scustomerbase.EvaluatingtheSalesForceThejobofsalesmanagersisnotcompleteuntilthetotaleffortofthesalesforceisevaluated.First,itisimportanttodetermineifthesalesfunctionismeetingitsquantitativeobjectives.Ifnot,thesalesmanagermustfigureoutthecauses.Individualsalespersonperformanceisnormallymeasuredagainstsalesquotas for individualsalesterritories,evenwhencompensationplansdonotincludebonusesorcommissionsbasedonquotas.Otherquantitativemeasures,suchasnumberofsalescalls and salesreports,mayalsobeusedintheevaluation.Manyfirmsalsoevaluatetheirsalesforceonqualitativeindicatorsofperformancesuchassalespersonattitude,productknowledge, and communicationskills.Increasingly,asfirmsfocusonrelationshipmanagement,thelevelofcustomersatisfactionisastrongqualitativemeasureofsuperiorsalespersonperformance.Finally,thesalesperson’sexpenseaccount for travel and entertainment(T&E)maybeconsideredsincethebestsalesrecordcanmeanlittletoacompany’sbottomlineifthesalespersonisgougingthecompanywithoutrageousexpenses.Note:TheabovelecturenoteswerecompiledbyDavidGerth.Thesematerialsareacompositeofquotations,paraphrases, and ideasfromMarketing:RealPeople,RealChoices,Solomon&Stuart,2003,PrenticeHall;ContemporaryMarketing,Boone&Kurtz,2004,Thomson;PrinciplesofMarketing,Kotler&Armstrong,2004,PrenticeHall; and DavidGerth.Theyareonlyintended for thenoncommercialuseofstudentsinDavidGerth’smarketingclasses for educationalpurposes.othergroupsaboutmarketingconcerns and canbeeitherproactiveorreactive.Withproactivemarketing public relations ,themarketertakestheinitiative and seeksoutopportunities for promotingthefirm’sproducts,oftenincludingdistributionof press releases and featurearticles.Itisapowerfulmarketingtoolsinceitaddsnewscoveragethatreinforcesdirect promotion activities.Althoughsomepublicityhappensnaturally,moretypicallya“buzz”needstobecreatedbyafirm’spublicists.Reactivemarketing public relations respondstoanexternalsituationthathaspotentialnegativeconsequences for theorganization.Thegoalinthiscaseistomanagetheflowofinformationtoaddressconcernssothatconsumersdon’tpanic and distributorsdon’tabandontheproduct.TheInternethasexpandedthecapabilitiesofthetraditional public relations function.Corporatewebsitesposttestimonialsfromcustomers,makenewproductannouncements, and respondquicklytoimportantevents.Newsreleasespostedonthecompanywebsitemaydoubleassalesvehicles.TheInternetcanalsobeveryeffectiveinhandlingcompanycrises.WithahostofInternetnewssites,companiescanrespondtoacrisisonlineinfarlesstimethanotherformsofcommunicationsuchas press releasesorconferences. Public Public Public Public Relations Relations Relations RelationsObjectives:Objectives:Objectives:Objectives: Public relations specialistsneedtooperateatmanylevelstoensurethatvariouspublicsofacompanyreceivecoordinated,positivemessagesaboutthefirm.Thesegroupsincludecustomers,suppliers,employees,themedia,stockholders, and governmentregulators.Companiesthatpracticeintegratedmarketingcommunicationstrategiesknowthat public relations strategiesarebestusedinconcertwithadvertising,sales promotion, and personalsellinginordertosendaconsistentmessagetocustomers and otherstakeholders.AspartofthetotalIMCplan, public relations departmentsmayperformanyorallofthefollowingfunctionstoachievecommunicationsobjectives:• Public Affairs–Building and maintainingnationalorlocalcommunity relations. •Lobbying–Building and maintaining relations withlegislators and governmentofficialstoinfluencelegislation and regulation.•Investor Relations –Maintainingrelationshipswithshareholders and othersinthefinancialcommunity.•Development– Public relations withdonorsormembersofnonprofitorganizationstogainfinancialorvolunteersupport.•LocationPR–Enhancingtheimageofacity,region,orcountry.• Press Relations –Creating and placingnewsworthyinformationinthenewsmediatoattractattentiontoapersonorproduct.•ProductPublicity–Publicizingspecificproductstoconsumersaswellasotherorganizations. Public Public Public Public Relations Relations Relations RelationsTools:Tools:Tools:Tools: Public relations professionalsuseseveraltools.Theyuse:•News,•Speeches,•SpecialEvents,•MobileMarketing,•WrittenMaterials,•AudiovisualMaterials,•CorporateIdentityMaterials, and • Public ServiceActivities.Oneofthemajortoolsisnews.PRprofessionalsfindorcreatefavorablenewsabouttheorganization and itsproductsorpeople.Speechescanalsocreateproduct and companypublicity.Increasingly,companyexecutivesmustfieldquestionsfromthemediaorgivetalksattradeassociationsorsalesmeetings.AnothercommonPRtoolisspecialevents,rangingfromnewsconferences, press tours,grandopenings, and fireworksdisplaystolasershows,hotairballoonreleases,multimediapresentations and star-studdedspectaculars, and educationalprogramsdesignedtoreach and interesttargetpublics.Recently,mobilemarketing—travelingpromotionaltoursthatbringthebrandtoconsumers—hasemergedasaneffectivewaytobuildone-to-onerelationshipswithtargetedconsumers. Public relations peoplealsopreparewrittenmaterialstoreach and influencetheirtargetmarkets.Thesematerialsincludeannualreports,brochures,articles, and companynewsletters and magazines.Audiovisualmaterials,suchasfilms,slide -and- soundprograms, and video- and audiocassettes,arebeingusedincreasinglyascommunicationtools.Corporateidentitymaterialscanalsohelpcreateacorporateidentitythatthe public immediatelyrecognizes.Logos,stationery,brochures,signs,businessforms,businesscards,buildings,uniforms, and companycars and trucks—allbecomemarketingtoolswhentheyareattractive,distinctive, and memorable.Finally,companiescanimprove public goodwillbycontributingmoney and timeto public serviceactivities.PlanningPlanningPlanningPlanningaaaa Public Public Public Public Relations Relations Relations RelationsCampaign:Campaign:Campaign:Campaign:A public relations campaignisacoordinatedefforttocommunicatewithoneormoreoftheorganization’spublics.Thisisathree-stepprocessof:1.DevelopingObjectives,2.Executing, and 3.Evaluating.Theorganizationmustfirstdevelopclearobjectives for thePRprogramthatdefinethemessageitwantspeopletohear.ThePRspecialistsmustdevelopacampaignstrategythatincludes:•astatementofobjectives;•asituationanalysis;•specificationoftargetpublics,messagestobecommunicated, and specificprogramelementstobeused;•atimetable and budget; and •adiscussionofhowtheprogramwillbeevaluated.Executionofthecampaignmeansdecidingpreciselyhowthemessageshouldbecommunicatedtothetargetedpublics and implementingthedecisions.Anorganizationcanuseavarietyof public relations tools:newsconferences,specialevents,writtenmaterials,etc.Oneofthebarrierstogreaterrelianceon public relations campaignsisthedifficultyencounteredwhentryingtogaugetheireffectiveness.ItispossibletotellifaPRcampaignisgettingmediaexposure,thoughit’smoredifficulttogaugebottom-lineimpact.In-houseassessments,awareness and preferenceresearchstudies, and themeasurementofprint and broadcastcoveragegeneratedbyPRactivitiesaswellasimpressioncountscanbeusedinthePRcampaignevaluation.SalesSalesSalesSales Promotion: Promotion: Promotion: Promotion: SalesSalesSalesSales Promotion Promotion Promotion Promotionistheuseofshort-termincentivestoencouragethepurchaseorsaleofaproduct.Salespromotionsareprogramssuchascontests,coupons,displays,tradeshows,samples,premiums,productdemonstrations,orotherincentivesthatmarketersdesigntobuildinterestinorencouragepurchaseofaproductduringaspecifiedtimeperiod.Salespromotionsareintendedtostimulateimmediateaction,oftenintheformofapurchase,ratherthantobuildlong-termloyalty.Whereasadvertising and personalsellingofferreasonstobuyaproduct,sales promotion offersreasonstobuynow.Sales promotion gearedtomarketingintermediariesiscalledtradetradetradetrade promotion promotion promotion promotion.Companiesactuallyspendaboutasmuchontrade promotion asonadvertising and consumer-orientedsales promotion combined.Trade promotion strategiesincludeofferingfreemerchandise,buybackallowances, and merchandiseallowancesalongwithsponsorshipofsalesconteststoencouragewholesalers and retailerstosellmoreofcertainproductsorproductlines.Sales promotion toolsareusedbymostorganizations,includingmanufacturers,distributors,retailers,tradeassociations, and not -for- profitinstitutions.Theyaretargetedtowardfinalbuyers,retailers and wholesalers,businesscustomers, and membersofthesalesforce.Severalfactorshavecontributedtotherapidgrowthofsales promotion, particularlyinconsumermarkets.First,insidethecompany,productmanagersfacegreaterpressurestoincreasetheircurrentsales; and sales promotion isviewedasaneffectiveshort-runsalestool.Second,externally,thecompanyfacesmorecompetition; and competingbrandsarelessdifferentiated.Increasingly,competitorsareusingsales promotion tohelpdifferentiatetheiroffers.Third,advertisingefficiencyhasdeclinedbecauseofrisingcosts,mediaclutter, and legalconstraints.Finally,consumershavebecomemoredealoriented, and ever-largerretailersaredemandingmoredealsfrommanufacturers.Thegrowinguseofsales promotion hasresultedin promotion clutter,similartoadvertisingclutter,however.Consumersareincreasinglytuningoutsalespromotions,weakeningtheirabilitytotriggerimmediatepurchase.Manufacturersarenowsearching for waystoriseabovetheclutter,suchasofferinglargercouponvaluesorcreatingmoredramaticpoint-ofpurchasedisplays.SalesSalesSalesSales Promotion Promotion Promotion PromotionObjectives:Objectives:Objectives:Objectives:Sales promotion objectivesdifferwidely:•IncreaseShort-TermSales(consumer promotion) •BuildLong-TermMarketShare(consumer promotion) •EncourageRetailerstoCarryNewItems and AdditionalInventory(trade promotion) •EncourageRetailerstoAdvertise and ProvideMoreShelfSpace(trade promotion) •EncourageRetailerstoBuyAhead(trade promotion) •IncreaseSalesForceSupport(salesforce promotion) •IncreaseNumberofNewAccounts(salesforce promotion) Sellersmayuseconsumerpromotionstoincreaseshort-termsalesortohelpbuildlong-termmarketshare.Objectives for tradepromotionsincludegettingretailerstocarrynewitems and moreinventory,gettingthemtoadvertisetheproduct and giveitmoreshelfspace, and gettingthemtobuyahead.Salesforce promotion objectivesincludegettingmoresalesforcesupport for currentornewproductsorgettingsalespeopletosignupnewaccounts.Salespromotionsareusuallyusedtogetherwithadvertising,personalselling,orother promotion mixtools.Consumerpromotionsmustusuallybeadvertised and canaddexcitement and pullingpowertoads.Trade and salesforcepromotionssupportthefirm’spersonalsellingprocess.Ingeneral,ratherthancreatingonlyshort-termsalesortemporarybrandswitching,salespromotionsshouldhelptoreinforcetheproduct’sposition and buildlong-termcustomerrelationships.Increasingly,marketersareavoiding“quickfix,”price-onlypromotionsinfavorofpromotionsdesignedtobuildbrandequity.Consumer-OrientedConsumer-OrientedConsumer-OrientedConsumer-OrientedSalesSalesSalesSales Promotion: Promotion: Promotion: Promotion: Themainconsumer promotion toolsincludesamples,coupons,cashrefunds,pricepacks,premiums,advertisingspecialties,patronagerewards,point-of-purchasedisplays and demonstrations, and contests,sweepstakes, and games.Consumer-orientedsalespromotionscanbeclassifiedaseitherprice-basedorattention-gettingconsumer promotion. Price-BasedConsumer Promotion Price-basedconsumerpromotionsemphasizeshort-termpricereductionsorrefunds,encouragingconsumerstochooseabrandwhilethedealison.Ifusedtoofrequently,however,consumersbecomeconditionedtopurchasetheproductonlyatthelowerpromotionalprice.CouponsAcouponcouponcouponcouponisacertificatethatgivesbuyersasavingwhentheypurchaseaspecifiedproduct.Couponscanstimulatesalesofamaturebrandorpromoteearlytrialofanewbrand.Redemptionrateshavebeendeclininginrecentyears,however,asaresultofcouponclutter.Mostmajorconsumergoodscompaniesareissuingfewercoupons and targetingthemmorecarefully.Theyarealsocultivatingnewoutlets for distributingcoupons,suchassupermarketshelfdispensers,electronicpoint-of-salecouponprinters,or“paperlesscouponsystems.”CashRebateOffersAcashcashcashcashrebaterebaterebaterebateisanoffertorefundpartofthepurchasepriceofaproducttoconsumerswhosenda“proofofpurchase”tothemanufacturer.PricePacksApricepricepricepricepackpackpackpackisareducedpricethatismarkedbytheproducerdirectlyonthelabelorpackage.Pricepackscanbesinglepackagessoldatareducedprice,ortworelatedproductsbandedtogether.Pricepacksareveryeffective—evenmoresothancoupons—instimulatingshort-termsales.PatronageRewardsApatronagepatronagepatronagepatronagerewardrewardrewardrewardiscashorotheraward for theregularuseofacertaincompany’sproducts.SpecialPacksAspecialspecialspecialspecialpackpackpackpackisapackagethatgivestheshoppermoreproductinsteadofloweringitsprice.Aspecialpackalsocanbeaseparateproductgivenawayalongwithanotherproduct.Attention-GettingConsumer Promotion Attention-gettingconsumerpromotionsstimulateinterestin and publicity for acompany’sproducts.SamplesAsamplesamplesamplesampleisasmallamountofaproductofferedtoconsumers for trial.Samplingisthemosteffective—butmostexpensive—waytointroduceanewproduct.About84percentofconsumerpackaged-goodsmarketersusesamplingasapartoftheir promotion strategy.Somesamplesarefree; for others,companieschargeasmallamounttooffsetitscost.Thesamplemightbedelivereddoor-to-door,sentbymail,handedoutinastore,attachedtoanotherproduct,orfeaturedinanad.Samplescanalsocomewiththemorningnewspaper,inasamplepack,orviatheInternet.PremiumsApremiumpremiumpremiumpremiumisagoodofferedeitherfreeoratlowcostasanincentivetobuyaproduct.Apremiumisnottheproductbeingpromoted.Itisusedasanincentivetoencouragepurchaseofthefeaturedproduct.Apremiummaycomeinsideoroutsidethepackage,orthroughthemail.AdvertisingSpecialtiesAnadvertisingadvertisingadvertisingadvertisingspecialtyspecialtyspecialtyspecialtyisausefularticleimprintedwithanadvertiser’sname,givenasagifttoconsumers.Typicalitemsincludepens,calendars,keyrings,matches,shoppingbags,T-shirts,caps,nailfiles, and coffeemugs.Inarecentstudy,63percentofallconsumerssurveyedwereeithercarryingorwearinganadspecialtyitem.Morethanthree-quartersofthosewhohadanitemcouldrecalltheadvertiser’snameormessagebeforeshowingtheitemtotheinterviewer.Point-of-Purchase(POP)Promotions ... UnitUnitUnitUnit12:12:12:12: Public Public Public Public Relations, Relations, Relations, Relations, SalesSalesSalesSales Promotion, Promotion, Promotion, Promotion, and and and andPersonalPersonalPersonalPersonalSellingSellingSellingSelling Public Public Public Public Relations Relations Relations Relations and and and andPublicity:Publicity:Publicity:Publicity: Public Public Public Public relations relations relations relationsisanorganization’scommunicationsthatseektobuildgoodrelationshipswithanorganization’spublics,includingconsumers,stockholders, and legislators.Itincludesobtainingfavorablepublicity,buildingupagood“corporateimage,” and handlingorheadingoffunfavorablerumors,stories, and events.PublicityPublicityPublicityPublicityisunpaidcommunicationaboutanorganizationthatappearsinthemassmedia. Public relations mayconsistofwriting press releases,holdingspecialevents,conducting and publishingconsumersurveysaboutaproductorthecompany, and effortstoputapositivespinonnegativecompanynews.Unlikesalespromotions, public relations activitiesdonotusuallyseekashort-termincreaseinsales.Instead,theytrytocraftalong-termpositiveimage for theproductortheorganization.Comparedwithpersonalselling,advertising, and salespromotions,expenditures for public relations areusuallylowinmostorganizations.Sincecompaniesdonotpay for publicity,theyhavelesscontroloverthepublicationofgoodorbadcompanynews.Butthisoftenmeansthatconsumersfindthistypeofnewssourcemorebelievablethaniftheinformationweredisseminateddirectlybythecompany.MarketingMarketingMarketingMarketing and and and andNonmarketingNonmarketingNonmarketingNonmarketing Public Public Public Public Relations: Relations: Relations: Relations: Thebasicruleof public relations istodosomethinggood and thentalkaboutit. Public relations iscrucialtoanorganization’sabilitytoestablish and maintainafavorableimage.NonmarketingNonmarketingNonmarketingNonmarketing public public public public relations relations relations relationsreferstoacompany’smessagesaboutgeneralmanagementissues.Whenacompanymakesadecisionthataffectsanyofitspublics,inputfrom public relations specialistscanhelptosmoothitsdealingswiththosepublics.Acompany, for example,thatdecidestocloseaplantwouldneedadviceonhowtodealwiththelocalcommunity.Otherexamplesincludeacompany’sattemptstogainfavorable public opinionduringalongstrikeoranopenlettertoCongresspublishedinanewspaperduringcongressionaldebatesonabillthatwouldaffectaparticularindustry.MarketingMarketingMarketingMarketing public public public public relations relations relations relationsreferstonarrowlyfocused public relations activitiesthatdirectlysupportmarketinggoals.Marketing public relations involvesanorganization’srelationshipswithconsumersorAllowancesAnallowanceallowanceallowanceallowanceispromotionalmoneypaidbymanufacturerstoretailersinreturn for anagreementtofeaturethemanufacturer’sproductsinsomeway.Anadvertisingallowancecompensatesretailers for advertisingtheproduct.Adisplayallowancecompensatesthem for usingspecialdisplays.Conventions and TradeShowsManycompanies and tradeassociationsorganizeconventions and tradeshowstopromotetheirproducts.Firmssellingtotheindustryshowtheirproductsatthetradetradetradetradeshowshowshowshow.Atradetradetradetradeshowshowshowshowisan event atwhichmanycompaniessetupelaborateexhibitstoshowtheirproducts,giveawaysamples,distributeproductliterature, and troll for newbusinesscontacts.Tradeshowsaremajorvehicles for manufacturerstoshowofftheirproductlinestowholesalers and retailers.Morethan4,300tradeshowstakeplaceeveryyear,drawingasmanyas85millionpeople.Vendorsreceivemanybenefits,suchasopportunitiestofindnewsalesleads,contactcustomers,introducenewproducts,meetnewcustomers,sellmoretopresentcustomers, and educatecustomerswithpublications and audiovisualmaterials.Tradeshowsalsohelpcompaniesreachmanyprospectsnotreachedthroughtheirsalesforces.About90percentofatradeshow’svisitorsseeacompany’ssalespeople for thefirsttimeattheshow.Businessmarketersmayspendasmuchas35percentoftheirannual promotion budgetsontradeshows.OtherProgramsManufacturersmayofferfreefreefreefreegoodsgoodsgoodsgoods,whichareextracasesofmerchandise,toresellerswhobuyacertainquantityorwhofeatureacertainflavororsize.Theymayofferpushpushpushpushmoneymoneymoneymoney—cashorgiftstodealersortheirsalesforcesto“push”themanufacturer’sgoods.Mostretailersalsochargemanufacturersslottingslottingslottingslottingfeesfeesfeesfees—paymentsdemandedbyretailersbeforetheywillacceptnewproducts and find“slots” for themontheshelves.Manufacturersmayalsogiveretailersfreespecialtyspecialtyspecialtyspecialtyadvertisingadvertisingadvertisingadvertisingitemsitemsitemsitemsthatcarrythecompany’sname,suchaspens,pencils,calendars,paperweights,matchbooks,memopads, and yardsticks. For moreexpensive and highlycomplexproducts,manufacturersoftenprovidespecializedspecializedspecializedspecializedtrainingtrainingtrainingtraining for retailsalespeople.Thisbackgroundhelpssalespeopleexplainfeatures,competitiveadvantages, and otherinformationtoconsumers.Trainingcanbeprovidedinseveralways:Amanufacturer’ssalesrepresentativecanconducttrainingsessionsduringregularsalescalls,orthefirmcandistributesalesliterature and videocassettes.SalesSalesSalesSalesForceForceForceForce Promotion: Promotion: Promotion: Promotion: Salesforce promotion isdirectedatthecompany’sownsalesforce(oftentimesthemanufacturer’ssalesforce)—ratherthanabusinesscustomer’ssalesforcewhichisinthedistributionchannel,suchasaretailer’ssalesforce.Contests, for example,couldbeusedtourgethesalesforcetoincreasetheirefforts,withprizesgoingtothetopperformers.Asalessalessalessalescontestcontestcontestcontestisacontest for salespeopletomotivatethemtoincreasetheirsalesperformanceoveragivenperiod.Salescontestsmotivate and recognizegoodcompanyperformers,whomayreceivetrips,cashprizes,orothergifts.Salescontestsworkbestwhentheyaretiedtomeasurable and achievablesalesobjectives.Otherincentivescouldalsobeprovidedtoencouragethesalesforcetoincreasenewaccountsinadditiontoboostingsales.PersonalPersonalPersonalPersonalSelling:Selling:Selling:Selling:PersonalPersonalPersonalPersonalsellingsellingsellingsellingispromotionalpresentationbythefirm’ssalesforceconductedonaperson-to-personbasiswiththebuyer for thepurposeofmakingsales and buildingcustomerrelationships.Personalsellingistheoldestformof promotion. Thisdirectformof promotion maybeconductedface-to-face,overthetelephone,throughvideoconferencing,orthroughinteractivecomputerlinksbetweenthebuyer and theseller.Thisdirectcontactwiththecustomergivesthesalespersontheopportunitytobeflexible and modifythesalesmessagetocoincidewiththecustomer’sneeds.Thesalespersoncangetimmediatefeedbackfromthecustomer.Thisformof promotion hasahighcostpercontactwiththecustomer.Theaveragesalescallcostsabout$300.Itisdifficulttoensureconsistencyofmessagewhenitisdeliveredbymanydifferentcompanyrepresentatives.Thecredibilityofsalespeopleoftendependsonthequalityoftheircompany’simage,whichhasbeencreatedbyother promotion strategies.About14millionpeopleintheU.S.areemployedinpersonalselling.Today,mostsalespeoplearewell-educated,well-trainedprofessionalswhoworktobuild and maintainlong-termcustomerrelationshipsbylisteningtotheircustomers,assessingcustomerneeds, and organizingthecompany’seffortstosolvecustomerproblems.Thetermsalespersoncoversawiderangeofpositions.Atoneextreme,asalespersonmightbelargelyanordertaker,suchasadepartmentstoresalespersonstandingbehindacounter.Attheotherextremeareordergetters,whosepositionsdemandthecreativesellingofproductsrangingfromappliances,industrialequipment, and airplanestoinsurance,advertising, and informationtechnologyservices.TheTheTheTheRoleRoleRoleRoleofofofofPersonalPersonalPersonalPersonalSelling:Selling:Selling:Selling:Generally,apersonalsaleseffortismoreimportantwhenafirmengagesinapushstrategy,inwhichthegoalistopushtheproductthroughthedistributionchannelsothatitisavailabletoconsumers.PersonalsellingalsoislikelytobecrucialinB2Bcontextswhendirectinteractionwithupper-levelmanagementisrequiredtosecureanimportantsale— and oftenwhenintensepricenegotiationsoccurbeforethesaleismade.Inaddition,inexperiencedbuyersmayneedthehands-onassistancethataprofessionalsalespersoncanprovide.Firmssellingproductsthatconsumersbuyinfrequently,suchascomputers,lawnmowers, and collegeeducations,oftenrelyheavilyonpersonalselling,asdofirmssellingcomplexorveryexpensiveproductsthatneedasalespersontoexplain,justify, and sellthem.Personalselling,however,hassomedisadvantagesthatlimittheroleplayedbypersonalsellinginthe promotion mix.First,whenthedollaramountofindividualpurchasesislow,itisn’teconomicallyfeasibletousepersonalselling.Thecostpercontactwithacustomerishighcomparedtootherformsofcommunication,suchasadvertising.Salespeoplecanalsoonlymakealimitednumberofsalescallsaday.Relianceonpersonalsellingiseffectiveonlywhenthesuccessratioisatitshighest.Becausethecostofutilizingsalespeopleishigh,telemarketingisgrowinginpopularity.Thetypesofsalespeople and theirfunctionsvaryconsiderably.Thepersonwhoprocessesacomputerpurchaseoverthephoneisanorderorderorderordertakertakertakertaker,asalespersonwhoseprimaryfunctionistofacilitatetransactionsthatthecustomerinitiates.Ordertakersincludebothinside and outsidesalespeople.Mostretailsalespeopleareinsideordertakers,butoftenwholesalers,dealers, and distributorsemploysalespeopletowaitoncustomers.Incontrast,acomputertechnicianisatechnicaltechnicaltechnicaltechnicalspecialistspecialistspecialistspecialist,asalessupportpersonwithahighleveloftechnicalexpertisewhoassistsinproductdemonstrations,recommendations for complexequipment, and setupofmachinery.Thetechnicalspecialist’sjobistoprovidesalessupportratherthanactuallyclosingthesale.Thetechnicalspecialistpromotesthefirm and triestostimulatedemand for aproducttomakeiteasier for colleaguestoactuallymakethesale.Sometimesapersonwhosejobistolaythegroundworkisknownasamissionarymissionarymissionarymissionarysalespersonsalespersonsalespersonsalesperson.Thisisasalespersonwhopromotesthefirm and triestostimulatedemand for aproduct,butdoesnotactuallycompleteasale.Manyfirmsfindthatthesellingfunctionisbesthandledbyteamteamteamteamsellingsellingsellingselling,usingteamsofpeoplefromsales,marketing,engineering,finance,technicalsupport, and evenuppermanagementtoservicelarge,complexaccounts.Finally,thepersonwhoactuallyconvincesthecustomertobuyisanorderorderorderordergettergettergettergetter,asalespersonwhoworkscreativelytodeveloprelationshipswithcustomersortogeneratenewsales.ApproachesApproachesApproachesApproachestotototoPersonalPersonalPersonalPersonalSelling:Selling:Selling:Selling:Personalsellingisoneoftheoldestformsof promotion, butitsimagehasbeentarnishedbysmooth-talkingpitchmenwhohavesometimessaidanythingtomakeasale.Inmorerecentyears,personalsellinghasbeguntoredeemitselfasaprofession and hasmovedfromatransactional,hard-selltechniquetoarelationshipmarketingapproach.TransactionalMarketingThehardsellisahigh-pressureprocess.Hard-selltacticsareaformoftransactionaltransactionaltransactionaltransactionalsellingsellingsellingselling,aformofpersonalsellingthatfocusesonmakinganimmediatesalewithlittleornoattempttodeveloparelationshipwiththecustomer.Ascustomers,thehardsellmakesusfeelmanipulated and resentful.Thistechniquealsocontributestothenegativeimagemanyofushaveofobnoxioussalespeople.RelationshipMarketingToday’sprofessionalsalespersonismorelikelytopracticerelationshiprelationshiprelationshiprelationshipsellingsellingsellingselling,aformofpersonalsellinginwhichthesalespersonseekstodevelopamutuallysatisfyingrelationshipwiththeconsumer.Relationshipsellinginvolveswinning,keeping, and developingcustomers.Winningacustomermeansconvertinganinterestedprospectintosomeonewhoisconvincedthattheproductholdsvalue for himorher.Keepingacustomermeansensuringthatthecustomergetswhatheorshepaid for. Developingacustomermeanssatisfyingthecustomersothatheorshewillbecountedontoprovidefuturebusiness.Theprofessionalsalespersonwhogenuinelyadherestotheprinciplesofrelationshipmarketingisarelationshipbuilder and acustomerproblemsolver.TheTheTheTheCreativeCreativeCreativeCreativeSellingSellingSellingSellingProcess:Process:Process:Process:Sellingisseldomboring.Everycustomer,everysalescall, and everysalespersonareunique.Somesalespeoplearesuccessfulprimarilybecausetheyknowsomuchaboutwhattheysell.Othersaresuccessfulbecausetheyhavebuiltstrongrelationshipswithcustomerswholookforwardtotheirvisits.Mostsalespeopleunderstand and engageinaseriesofactivitiesnecessarytobringaboutatransaction.Complexorexpensivesalesrequirecarefulplanning, and successfulsellinginthesecasesismorelikelyifthesalespersonundergoesasystematicseriesofstepsknownasthecreativecreativecreativecreativesellingsellingsellingsellingprocessprocessprocessprocess.Thesestepsrequirethesalespersontoseekoutcustomers,analyzetheirneeds,determinehowproductattributesprovidebenefits, and thendecidehowbesttocommunicatethistotheprospects.Thestepsintheprocessincludeprospecting,qualifying,preapproach,approach,salespresentation,demonstration,handlingobjections,closing, and follow-up.ProspectingProspectingProspectingProspectingProspectingisthestepofthesellingprocessthatincludesidentifying and developingalistofpotentialorprospectivecustomers.Prospectsorsalesleadscancomefromexistingcustomerlists,telephonedirectories,orcommerciallyavailabledatabases.Sometimescompaniesgeneratesalesleadsthroughtheiradvertisingorsalespromotionsbylettingcustomersrequestmoreinformation.Onewaytogenerateleadsisthroughcoldcalling,whenthesalespersoncontactsprospectswithoutpriorintroductionorarrangement.Salespeoplealsorelyonreferrals.Currentclientswhoaresatisfiedwiththeirpurchaseoftengivereferrals.QualifyingSalespeoplenextneedtoqualifyqualifyqualifyqualifytheirprospectsprospectsprospectsprospects,thestepofthesellingprocessthatdetermineshowlikelyprospectsaretobecomecustomers.Prospectscanbequalifiedbylookingattheirfinancialability,volumeofbusiness,specialneeds,location, and possibilities for growth.PreapproachThepreapproachpreapproachpreapproachpreapproachisthestepinthesellingprocessinwhichthesalespersonlearnsasmuchaspossibleaboutaprospectivecustomerbeforemakingasalescall.Salespeopletrytolearnasmuchaspossibleaboutqualifiedprospectsearlyon.Theymayprobepriorpurchasehistory,currentneeds,orinformationabouttheirinterests.Thesalespersoncanconsultindustry and onlinesources,acquaintances,etc.tolearnabouttheprospect.Anothertaskistodecideonthebestapproach,whichmightbeapersonalvisit,aphonecall,oraletter.Thebesttimingshouldbeconsideredcarefullybecausemanyprospectsarebusiestatcertaintimes.Finally,thesalespersonshouldgivethoughttoanoverallsalesstrategy for theaccount.ApproachTheapproachapproachapproachapproachisthestepinthesellingprocessinwhichthesalespersonusuallymeetsthecustomer for thefirsttime.Heorsheshouldstartbuildingtherelationshipduringtheapproach.Thesalespersonshouldknowhowtomeet and greettheprospect and gettherelationshipofftoagoodstart.Thisstepinvolvesthesalesperson’sappearance,openinglines, and thefollow-upremarks.Theopeninglinesshouldbepositivetobuildgoodwillfromthebeginningoftherelationship.Ifthesalespersonmadecontactwiththeprospectthroughareferral,thesalespersonshouldprobablysaysoup-front.Thisopeningmightbefollowedbysomekeyquestionstolearnmoreaboutthecustomer’sneedsorbyshowingadisplayorsampletoattracttheprospect’sattention and curiosity.Asinallstagesofthesellingprocess,listeningtothecustomeriscrucial.SalesPresentationThesalessalessalessalespresentationpresentationpresentationpresentationisthestepinthesellingprocessinwhichthesalespersonseekstopersuasivelycommunicatetheproduct’sfeatures and thebenefitsitwillprovideafterthesale.Proofstatements,suchasdataonpastsales,testimonials,guarantees,orresearchresults,helptomakethesalesperson’spresentationcredible.Somesalespresentationsarecanned,meaningascripthasbeenwritteninadvance, and thesamemessageisdeliveredtomanyprospects.Thistechniqueoftenprovidesaseriesofverbalpromptstowhichthereareexpectedcustomerresponses.Asimilarapproachcalledaformulatedapproachidentifiesaprospect’sneeds and thenprovidesascriptedsalespitchkeyedtothatkindofprospect.Thesestandardizedapproachesworkfineinsomecases,butthemosteffectivesalespresentationsarethosethataretailoredtothespecificcustomer.Increasingly,salespresentationsaregoinghigh-tech.Computer-basedmultimediapresentationsareconsideredthenextwaveinsales-forceautomation.Withamultimedia-readynotebookcomputerorLCDprojectioncomputer,salespeoplecanbringcolor,animation,video,audio, and interactivity—aswellasthelatestproduct and pricinginformation—totheirpresentations.DemonstrationOneimportantadvantageofpersonalsellingovermostadvertisingistheabilityofsalespeopletoprovideademonstrationdemonstrationdemonstrationdemonstrationoftheproducttothepotentialbuyer.Manyfirmsusenewtechnologiestomaketheirdemonstrationsmoreeffective.Multimediainteractivedemonstrationsarenowcommon.Thekeytoagooddemonstration—onethatgainsthecustomer’sattention,keepshisorherinterest,isconvincing, and staysinthecustomer’smemory—isplanning.Thesalespersonshouldcheck and recheckallaspectsofthedemonstrationpriortoitsdelivery.HandlingObjectionsHandlingHandlingHandlingHandlingobjectionsobjectionsobjectionsobjectionsisthestepinthesellingprocessinwhichthesalespersonseeksout,clarifies, and overcomescustomerobjectionstobuying.Customersalmostalwayshaveobjectionsduringthepresentationorwhenaskedtoplaceanorder.Theproblemcanbeeitherlogicalorpsychological, and objectionsareoftentimesunspoken.Thesalespersonshouldhandleobjectionsusingapositiveapproach,byseekingouthiddenobjections,askingtheprospecttoclarifyanyobjections, and takingobjectionsasopportunitiestoprovidemoreinformation—turningtheobjectionsintoreasons for buying.Everysalespersonneedstrainingintheskillsofhandlingobjections.ClosingClosingClosingClosingClosingisthestepinthesellingprocessinwhichthesalespersonasksthecustomer for anorder.Somesalespeopledonotgetaroundtoclosingordonothandleitwell.Theymaylackconfidence,feelguiltyaboutasking for theorder,orfailtorecognizetherightmomenttoclosethesale.Salespeopleshouldknowhowtorecognizeclosingsignalsfromthebuyer,includingbodylanguage,comments, and questions.Salespeoplecanuseseveralclosingtechniques.Theycanask for theorder,reviewpointsofagreement,offertohelpwriteuptheorder,askwhethertheybuyerwantsthismodelorthatone,ornotethatthebuyerwillloseoutiftheorderisnotplacednow.Thesalespersonmayalsoofferthebuyerspecialreasonstoclose,suchasalowerpriceoranextraquantityatnocharge.Follow-UpFollow-upFollow-upFollow-upFollow-upisthelaststepinthesellingprocess,inwhichthesalespersonfollowsupafterthesaletoensurecustomersatisfaction and repeatbusiness.Rightafterclosing,thesalespersonshouldcompleteanydetailsondeliverytime,purchaseterms, and othermatters.Thesalespersonthenshouldscheduleafollow-upcallwhentheinitialorderisreceived,tomakesurethereisproperinstallation,instruction, and/ orservicing.Thisvisitshouldrevealanyproblems,assurethebuyerofthesalesperson’sinterest, and reduceanybuyerconcernsthatmighthavearisensincethesale.Follow-upalsoallowsthesalespersontobridgetothenextpurchase.Oncearelationshipdevelops,thesellingprocessisonlythebeginning.Evenasonecycleofpurchasingdrawstoaclose,agoodsalespersonisalreadylayingthefoundation for thenextone.SalesSalesSalesSalesManagement:Management:Management:Management:SalesSalesSalesSalesmanagementmanagementmanagementmanagementistheprocessofplanning,implementing, and controllingthepersonalsellingfunctionofanorganization.Personalsellingisateameffortthatrequirescarefulplanning and salespeopleinthefieldwhen and wherecustomersneedthem.SalesForceObjectivesSalesforceobjectivesstatewhatthesalesforceisexpectedtoaccomplish and when.Thesegoalscouldincludeacquiringnewcustomers,generatingspecificamountsofsalesvolume,reducingsalesexpenses,improvingcustomersatisfaction,gatheringnew-productsuggestions,traininggoals, and communityinvolvementgoals.Salesmanagersalsoworkwiththeirsalespeopletodevelopindividualgoals.Performancegoalsaremeasurableoutcomes,suchastotalsales and totalprofitspersalesperson.Behavioralgoalsspecifyactionssalespeoplemustaccomplish,suchasthenumberofprospectstoidentify,thenumberofsalescalls, and thenumberofsalespresentations.SalesForceStrategyAsalesforcestrategyspecifiesthestructure and sizeofafirm’ssalesforce.Eachsalespersonhastheresponsibility for asetgroupofcustomers—thesalessalessalessalesterritoryterritoryterritoryterritory.Theterritorystructureallowssalespeopletohaveanin-depthunderstandingofcustomers and theirneedsthroughfrequentcontacts.Themostcommonwaytoallotterritoriesisgeographically,minimizingtravel and otherfieldexpenses.Ageographicsalesforcestructureusuallyissizedaccordingtohowmanycustomersarefoundinagivenarea.Iftheproductlineisdiverseortechnicallycomplex,abetterapproachmaybetostructuresalesterritoriesbasedondifferentclassesofproductstoenablethesalesforcetoprovidemoreexpertisetoasetofcustomerswithsimilarneeds.Stillanotherstructureisindustryspecialization,inwhichsalespeoplefocusonasingleindustryorasmallnumberofindustries.Puttingasalespersonintothefieldisexpensive,sothenumberofpeopleinthesalesforcehasanimpactonacompany’sprofitability.Determiningtheoptimalnumberofsalespeopleisanimportantdecision.Recruiting,Selecting,&TrainingtheSalesForceBecausethequalityofasalesforcecanmakeorbreakafirm,atoppriority for salesmanagersistorecruit and selecttherightsetofpeopletodothejob—peoplewhoarestrategicthinkers,whohavetechnicalknowledgepertainingtotheindustry, and whohaveexcellentinterpersonalskills.Companiesscreenpotentialsalespeopletorevealtheseskills,alongwithusefulinformationaboutinterests and capabilities.Pencil -and- papertestscandeterminequantitativeskills and competenceinareasnoteasilyevaluatedthroughinterviews.Salestrainingteachessalespeopleabouttheorganization and itsproducts and howtodeveloptherightskills,knowledge, and attitudes.Newsalespeoplemayspendanywherefromafewweeksormonthstoayearormoreintraining.Theaverageinitialtrainingperiodisfourmonths.Then,mostcompaniesprovidecontinuingsalestrainingviaseminars,salesmeetings, and theInternetthroughoutthesalesperson’scareer.Compensating,Motivating, and SupervisingtheSalesForceOnewaytomotivatesalespeopleistopaythemwell,oftentimesbytyingcompensationtoperformance.Astraightcommissionplanisbasedsolelyonapercentageofsalesthepersoncloses.Underacommission-with-drawplan,earningsarebasedoncommissionplusaregularpayment,or“draw,”thatmaybechargedagainstfuturecommissionsifcurrentsalesareinadequatetocoverthedraw.Withastraightsalarycompensationplan,thesalespersonispaidasetamountregardlessofsalesperformance.Sometimesstraightsalaryplansareaugmentedbyuseofaquota-bonusplan,inwhichsalespeoplearepaidsalaryplusabonus for salesaboveanassignedquota.Inadditiontobasiccompensation,manymanagersfindthatavarietyofotherincentivescanalsoenhancethesalesforceefforttremendously.Suchincentivescanrangefromfreevacationstoextracash.Althoughmanysalespeopleliketoworkindependently,supervisionisessentialtoaneffectivesalesforce.Salesmanagersoftenrequiresalespeopletodevelopmonthly,weekly,ordailycallreports,aplanofactiondetailingwhichcustomerswerecalledon and howthingswent.Thesereportsallowthesalesmanagertotrackwhatthesalespeoplearedoinginthefield, and theyprovidemarketingmanagerswithtimelyinformationaboutcustomers’responses,competitiveactivity, and anychangesinthefirm’scustomerbase.EvaluatingtheSalesForceThejobofsalesmanagersisnotcompleteuntilthetotaleffortofthesalesforceisevaluated.First,itisimportanttodetermineifthesalesfunctionismeetingitsquantitativeobjectives.Ifnot,thesalesmanagermustfigureoutthecauses.Individualsalespersonperformanceisnormallymeasuredagainstsalesquotas for individualsalesterritories,evenwhencompensationplansdonotincludebonusesorcommissionsbasedonquotas.Otherquantitativemeasures,suchasnumberofsalescalls and salesreports,mayalsobeusedintheevaluation.Manyfirmsalsoevaluatetheirsalesforceonqualitativeindicatorsofperformancesuchassalespersonattitude,productknowledge, and communicationskills.Increasingly,asfirmsfocusonrelationshipmanagement,thelevelofcustomersatisfactionisastrongqualitativemeasureofsuperiorsalespersonperformance.Finally,thesalesperson’sexpenseaccount for travel and entertainment(T&E)maybeconsideredsincethebestsalesrecordcanmeanlittletoacompany’sbottomlineifthesalespersonisgougingthecompanywithoutrageousexpenses.Note:TheabovelecturenoteswerecompiledbyDavidGerth.Thesematerialsareacompositeofquotations,paraphrases, and ideasfromMarketing:RealPeople,RealChoices,Solomon&Stuart,2003,PrenticeHall;ContemporaryMarketing,Boone&Kurtz,2004,Thomson;PrinciplesofMarketing,Kotler&Armstrong,2004,PrenticeHall; and DavidGerth.Theyareonlyintended for thenoncommercialuseofstudentsinDavidGerth’smarketingclasses for educationalpurposes.othergroupsaboutmarketingconcerns and canbeeitherproactiveorreactive.Withproactivemarketing public relations ,themarketertakestheinitiative and seeksoutopportunities for promotingthefirm’sproducts,oftenincludingdistributionof press releases and featurearticles.Itisapowerfulmarketingtoolsinceitaddsnewscoveragethatreinforcesdirect promotion activities.Althoughsomepublicityhappensnaturally,moretypicallya“buzz”needstobecreatedbyafirm’spublicists.Reactivemarketing public relations respondstoanexternalsituationthathaspotentialnegativeconsequences for theorganization.Thegoalinthiscaseistomanagetheflowofinformationtoaddressconcernssothatconsumersdon’tpanic and distributorsdon’tabandontheproduct.TheInternethasexpandedthecapabilitiesofthetraditional public relations function.Corporatewebsitesposttestimonialsfromcustomers,makenewproductannouncements, and respondquicklytoimportantevents.Newsreleasespostedonthecompanywebsitemaydoubleassalesvehicles.TheInternetcanalsobeveryeffectiveinhandlingcompanycrises.WithahostofInternetnewssites,companiescanrespondtoacrisisonlineinfarlesstimethanotherformsofcommunicationsuchas press releasesorconferences. Public Public Public Public Relations Relations Relations RelationsObjectives:Objectives:Objectives:Objectives: Public relations specialistsneedtooperateatmanylevelstoensurethatvariouspublicsofacompanyreceivecoordinated,positivemessagesaboutthefirm.Thesegroupsincludecustomers,suppliers,employees,themedia,stockholders, and governmentregulators.Companiesthatpracticeintegratedmarketingcommunicationstrategiesknowthat public relations strategiesarebestusedinconcertwithadvertising,sales promotion, and personalsellinginordertosendaconsistentmessagetocustomers and otherstakeholders.AspartofthetotalIMCplan, public relations departmentsmayperformanyorallofthefollowingfunctionstoachievecommunicationsobjectives:• Public Affairs–Building and maintainingnationalorlocalcommunity relations. •Lobbying–Building and maintaining relations withlegislators and governmentofficialstoinfluencelegislation and regulation.•Investor Relations –Maintainingrelationshipswithshareholders and othersinthefinancialcommunity.•Development– Public relations withdonorsormembersofnonprofitorganizationstogainfinancialorvolunteersupport.•LocationPR–Enhancingtheimageofacity,region,orcountry.• Press Relations –Creating and placingnewsworthyinformationinthenewsmediatoattractattentiontoapersonorproduct.•ProductPublicity–Publicizingspecificproductstoconsumersaswellasotherorganizations. Public Public Public Public Relations Relations Relations RelationsTools:Tools:Tools:Tools: Public relations professionalsuseseveraltools.Theyuse:•News,•Speeches,•SpecialEvents,•MobileMarketing,•WrittenMaterials,•AudiovisualMaterials,•CorporateIdentityMaterials, and • Public ServiceActivities.Oneofthemajortoolsisnews.PRprofessionalsfindorcreatefavorablenewsabouttheorganization and itsproductsorpeople.Speechescanalsocreateproduct and companypublicity.Increasingly,companyexecutivesmustfieldquestionsfromthemediaorgivetalksattradeassociationsorsalesmeetings.AnothercommonPRtoolisspecialevents,rangingfromnewsconferences, press tours,grandopenings, and fireworksdisplaystolasershows,hotairballoonreleases,multimediapresentations and star-studdedspectaculars, and educationalprogramsdesignedtoreach and interesttargetpublics.Recently,mobilemarketing—travelingpromotionaltoursthatbringthebrandtoconsumers—hasemergedasaneffectivewaytobuildone-to-onerelationshipswithtargetedconsumers. Public relations peoplealsopreparewrittenmaterialstoreach and influencetheirtargetmarkets.Thesematerialsincludeannualreports,brochures,articles, and companynewsletters and magazines.Audiovisualmaterials,suchasfilms,slide -and- soundprograms, and video- and audiocassettes,arebeingusedincreasinglyascommunicationtools.Corporateidentitymaterialscanalsohelpcreateacorporateidentitythatthe public immediatelyrecognizes.Logos,stationery,brochures,signs,businessforms,businesscards,buildings,uniforms, and companycars and trucks—allbecomemarketingtoolswhentheyareattractive,distinctive, and memorable.Finally,companiescanimprove public goodwillbycontributingmoney and timeto public serviceactivities.PlanningPlanningPlanningPlanningaaaa Public Public Public Public Relations Relations Relations RelationsCampaign:Campaign:Campaign:Campaign:A public relations campaignisacoordinatedefforttocommunicatewithoneormoreoftheorganization’spublics.Thisisathree-stepprocessof:1.DevelopingObjectives,2.Executing, and 3.Evaluating.Theorganizationmustfirstdevelopclearobjectives for thePRprogramthatdefinethemessageitwantspeopletohear.ThePRspecialistsmustdevelopacampaignstrategythatincludes:•astatementofobjectives;•asituationanalysis;•specificationoftargetpublics,messagestobecommunicated, and specificprogramelementstobeused;•atimetable and budget; and •adiscussionofhowtheprogramwillbeevaluated.Executionofthecampaignmeansdecidingpreciselyhowthemessageshouldbecommunicatedtothetargetedpublics and implementingthedecisions.Anorganizationcanuseavarietyof public relations tools:newsconferences,specialevents,writtenmaterials,etc.Oneofthebarrierstogreaterrelianceon public relations campaignsisthedifficultyencounteredwhentryingtogaugetheireffectiveness.ItispossibletotellifaPRcampaignisgettingmediaexposure,thoughit’smoredifficulttogaugebottom-lineimpact.In-houseassessments,awareness and preferenceresearchstudies, and themeasurementofprint and broadcastcoveragegeneratedbyPRactivitiesaswellasimpressioncountscanbeusedinthePRcampaignevaluation.SalesSalesSalesSales Promotion: Promotion: Promotion: Promotion: SalesSalesSalesSales Promotion Promotion Promotion Promotionistheuseofshort-termincentivestoencouragethepurchaseorsaleofaproduct.Salespromotionsareprogramssuchascontests,coupons,displays,tradeshows,samples,premiums,productdemonstrations,orotherincentivesthatmarketersdesigntobuildinterestinorencouragepurchaseofaproductduringaspecifiedtimeperiod.Salespromotionsareintendedtostimulateimmediateaction,oftenintheformofapurchase,ratherthantobuildlong-termloyalty.Whereasadvertising and personalsellingofferreasonstobuyaproduct,sales promotion offersreasonstobuynow.Sales promotion gearedtomarketingintermediariesiscalledtradetradetradetrade promotion promotion promotion promotion.Companiesactuallyspendaboutasmuchontrade promotion asonadvertising and consumer-orientedsales promotion combined.Trade promotion strategiesincludeofferingfreemerchandise,buybackallowances, and merchandiseallowancesalongwithsponsorshipofsalesconteststoencouragewholesalers and retailerstosellmoreofcertainproductsorproductlines.Sales promotion toolsareusedbymostorganizations,includingmanufacturers,distributors,retailers,tradeassociations, and not -for- profitinstitutions.Theyaretargetedtowardfinalbuyers,retailers and wholesalers,businesscustomers, and membersofthesalesforce.Severalfactorshavecontributedtotherapidgrowthofsales promotion, particularlyinconsumermarkets.First,insidethecompany,productmanagersfacegreaterpressurestoincreasetheircurrentsales; and sales promotion isviewedasaneffectiveshort-runsalestool.Second,externally,thecompanyfacesmorecompetition; and competingbrandsarelessdifferentiated.Increasingly,competitorsareusingsales promotion tohelpdifferentiatetheiroffers.Third,advertisingefficiencyhasdeclinedbecauseofrisingcosts,mediaclutter, and legalconstraints.Finally,consumershavebecomemoredealoriented, and ever-largerretailersaredemandingmoredealsfrommanufacturers.Thegrowinguseofsales promotion hasresultedin promotion clutter,similartoadvertisingclutter,however.Consumersareincreasinglytuningoutsalespromotions,weakeningtheirabilitytotriggerimmediatepurchase.Manufacturersarenowsearching for waystoriseabovetheclutter,suchasofferinglargercouponvaluesorcreatingmoredramaticpoint-ofpurchasedisplays.SalesSalesSalesSales Promotion Promotion Promotion PromotionObjectives:Objectives:Objectives:Objectives:Sales promotion objectivesdifferwidely:•IncreaseShort-TermSales(consumer promotion) •BuildLong-TermMarketShare(consumer promotion) •EncourageRetailerstoCarryNewItems and AdditionalInventory(trade promotion) •EncourageRetailerstoAdvertise and ProvideMoreShelfSpace(trade promotion) •EncourageRetailerstoBuyAhead(trade promotion) •IncreaseSalesForceSupport(salesforce promotion) •IncreaseNumberofNewAccounts(salesforce promotion) Sellersmayuseconsumerpromotionstoincreaseshort-termsalesortohelpbuildlong-termmarketshare.Objectives for tradepromotionsincludegettingretailerstocarrynewitems and moreinventory,gettingthemtoadvertisetheproduct and giveitmoreshelfspace, and gettingthemtobuyahead.Salesforce promotion objectivesincludegettingmoresalesforcesupport for currentornewproductsorgettingsalespeopletosignupnewaccounts.Salespromotionsareusuallyusedtogetherwithadvertising,personalselling,orother promotion mixtools.Consumerpromotionsmustusuallybeadvertised and canaddexcitement and pullingpowertoads.Trade and salesforcepromotionssupportthefirm’spersonalsellingprocess.Ingeneral,ratherthancreatingonlyshort-termsalesortemporarybrandswitching,salespromotionsshouldhelptoreinforcetheproduct’sposition and buildlong-termcustomerrelationships.Increasingly,marketersareavoiding“quickfix,”price-onlypromotionsinfavorofpromotionsdesignedtobuildbrandequity.Consumer-OrientedConsumer-OrientedConsumer-OrientedConsumer-OrientedSalesSalesSalesSales Promotion: Promotion: Promotion: Promotion: Themainconsumer promotion toolsincludesamples,coupons,cashrefunds,pricepacks,premiums,advertisingspecialties,patronagerewards,point-of-purchasedisplays and demonstrations, and contests,sweepstakes, and games.Consumer-orientedsalespromotionscanbeclassifiedaseitherprice-basedorattention-gettingconsumer promotion. Price-BasedConsumer Promotion Price-basedconsumerpromotionsemphasizeshort-termpricereductionsorrefunds,encouragingconsumerstochooseabrandwhilethedealison.Ifusedtoofrequently,however,consumersbecomeconditionedtopurchasetheproductonlyatthelowerpromotionalprice.CouponsAcouponcouponcouponcouponisacertificatethatgivesbuyersasavingwhentheypurchaseaspecifiedproduct.Couponscanstimulatesalesofamaturebrandorpromoteearlytrialofanewbrand.Redemptionrateshavebeendeclininginrecentyears,however,asaresultofcouponclutter.Mostmajorconsumergoodscompaniesareissuingfewercoupons and targetingthemmorecarefully.Theyarealsocultivatingnewoutlets for distributingcoupons,suchassupermarketshelfdispensers,electronicpoint-of-salecouponprinters,or“paperlesscouponsystems.”CashRebateOffersAcashcashcashcashrebaterebaterebaterebateisanoffertorefundpartofthepurchasepriceofaproducttoconsumerswhosenda“proofofpurchase”tothemanufacturer.PricePacksApricepricepricepricepackpackpackpackisareducedpricethatismarkedbytheproducerdirectlyonthelabelorpackage.Pricepackscanbesinglepackagessoldatareducedprice,ortworelatedproductsbandedtogether.Pricepacksareveryeffective—evenmoresothancoupons—instimulatingshort-termsales.PatronageRewardsApatronagepatronagepatronagepatronagerewardrewardrewardrewardiscashorotheraward for theregularuseofacertaincompany’sproducts.SpecialPacksAspecialspecialspecialspecialpackpackpackpackisapackagethatgivestheshoppermoreproductinsteadofloweringitsprice.Aspecialpackalsocanbeaseparateproductgivenawayalongwithanotherproduct.Attention-GettingConsumer Promotion Attention-gettingconsumerpromotionsstimulateinterestin and publicity for acompany’sproducts.SamplesAsamplesamplesamplesampleisasmallamountofaproductofferedtoconsumers for trial.Samplingisthemosteffective—butmostexpensive—waytointroduceanewproduct.About84percentofconsumerpackaged-goodsmarketersusesamplingasapartoftheir promotion strategy.Somesamplesarefree; for others,companieschargeasmallamounttooffsetitscost.Thesamplemightbedelivereddoor-to-door,sentbymail,handedoutinastore,attachedtoanotherproduct,orfeaturedinanad.Samplescanalsocomewiththemorningnewspaper,inasamplepack,orviatheInternet.PremiumsApremiumpremiumpremiumpremiumisagoodofferedeitherfreeoratlowcostasanincentivetobuyaproduct.Apremiumisnottheproductbeingpromoted.Itisusedasanincentivetoencouragepurchaseofthefeaturedproduct.Apremiummaycomeinsideoroutsidethepackage,orthroughthemail.AdvertisingSpecialtiesAnadvertisingadvertisingadvertisingadvertisingspecialtyspecialtyspecialtyspecialtyisausefularticleimprintedwithanadvertiser’sname,givenasagifttoconsumers.Typicalitemsincludepens,calendars,keyrings,matches,shoppingbags,T-shirts,caps,nailfiles, and coffeemugs.Inarecentstudy,63percentofallconsumerssurveyedwereeithercarryingorwearinganadspecialtyitem.Morethanthree-quartersofthosewhohadanitemcouldrecalltheadvertiser’snameormessagebeforeshowingtheitemtotheinterviewer.Point-of-Purchase(POP)Promotions ... UnitUnitUnitUnit12:12:12:12: Public Public Public Public Relations, Relations, Relations, Relations, SalesSalesSalesSales Promotion, Promotion, Promotion, Promotion, and and and andPersonalPersonalPersonalPersonalSellingSellingSellingSelling Public Public Public Public Relations Relations Relations Relations and and and andPublicity:Publicity:Publicity:Publicity: Public Public Public Public relations relations relations relationsisanorganization’scommunicationsthatseektobuildgoodrelationshipswithanorganization’spublics,includingconsumers,stockholders, and legislators.Itincludesobtainingfavorablepublicity,buildingupagood“corporateimage,” and handlingorheadingoffunfavorablerumors,stories, and events.PublicityPublicityPublicityPublicityisunpaidcommunicationaboutanorganizationthatappearsinthemassmedia. Public relations mayconsistofwriting press releases,holdingspecialevents,conducting and publishingconsumersurveysaboutaproductorthecompany, and effortstoputapositivespinonnegativecompanynews.Unlikesalespromotions, public relations activitiesdonotusuallyseekashort-termincreaseinsales.Instead,theytrytocraftalong-termpositiveimage for theproductortheorganization.Comparedwithpersonalselling,advertising, and salespromotions,expenditures for public relations areusuallylowinmostorganizations.Sincecompaniesdonotpay for publicity,theyhavelesscontroloverthepublicationofgoodorbadcompanynews.Butthisoftenmeansthatconsumersfindthistypeofnewssourcemorebelievablethaniftheinformationweredisseminateddirectlybythecompany.MarketingMarketingMarketingMarketing and and and andNonmarketingNonmarketingNonmarketingNonmarketing Public Public Public Public Relations: Relations: Relations: Relations: Thebasicruleof public relations istodosomethinggood and thentalkaboutit. Public relations iscrucialtoanorganization’sabilitytoestablish and maintainafavorableimage.NonmarketingNonmarketingNonmarketingNonmarketing public public public public relations relations relations relationsreferstoacompany’smessagesaboutgeneralmanagementissues.Whenacompanymakesadecisionthataffectsanyofitspublics,inputfrom public relations specialistscanhelptosmoothitsdealingswiththosepublics.Acompany, for example,thatdecidestocloseaplantwouldneedadviceonhowtodealwiththelocalcommunity.Otherexamplesincludeacompany’sattemptstogainfavorable public opinionduringalongstrikeoranopenlettertoCongresspublishedinanewspaperduringcongressionaldebatesonabillthatwouldaffectaparticularindustry.MarketingMarketingMarketingMarketing public public public public relations relations relations relationsreferstonarrowlyfocused public relations activitiesthatdirectlysupportmarketinggoals.Marketing public relations involvesanorganization’srelationshipswithconsumersorAllowancesAnallowanceallowanceallowanceallowanceispromotionalmoneypaidbymanufacturerstoretailersinreturn for anagreementtofeaturethemanufacturer’sproductsinsomeway.Anadvertisingallowancecompensatesretailers for advertisingtheproduct.Adisplayallowancecompensatesthem for usingspecialdisplays.Conventions and TradeShowsManycompanies and tradeassociationsorganizeconventions and tradeshowstopromotetheirproducts.Firmssellingtotheindustryshowtheirproductsatthetradetradetradetradeshowshowshowshow.Atradetradetradetradeshowshowshowshowisan event atwhichmanycompaniessetupelaborateexhibitstoshowtheirproducts,giveawaysamples,distributeproductliterature, and troll for newbusinesscontacts.Tradeshowsaremajorvehicles for manufacturerstoshowofftheirproductlinestowholesalers and retailers.Morethan4,300tradeshowstakeplaceeveryyear,drawingasmanyas85millionpeople.Vendorsreceivemanybenefits,suchasopportunitiestofindnewsalesleads,contactcustomers,introducenewproducts,meetnewcustomers,sellmoretopresentcustomers, and educatecustomerswithpublications and audiovisualmaterials.Tradeshowsalsohelpcompaniesreachmanyprospectsnotreachedthroughtheirsalesforces.About90percentofatradeshow’svisitorsseeacompany’ssalespeople for thefirsttimeattheshow.Businessmarketersmayspendasmuchas35percentoftheirannual promotion budgetsontradeshows.OtherProgramsManufacturersmayofferfreefreefreefreegoodsgoodsgoodsgoods,whichareextracasesofmerchandise,toresellerswhobuyacertainquantityorwhofeatureacertainflavororsize.Theymayofferpushpushpushpushmoneymoneymoneymoney—cashorgiftstodealersortheirsalesforcesto“push”themanufacturer’sgoods.Mostretailersalsochargemanufacturersslottingslottingslottingslottingfeesfeesfeesfees—paymentsdemandedbyretailersbeforetheywillacceptnewproducts and find“slots” for themontheshelves.Manufacturersmayalsogiveretailersfreespecialtyspecialtyspecialtyspecialtyadvertisingadvertisingadvertisingadvertisingitemsitemsitemsitemsthatcarrythecompany’sname,suchaspens,pencils,calendars,paperweights,matchbooks,memopads, and yardsticks. For moreexpensive and highlycomplexproducts,manufacturersoftenprovidespecializedspecializedspecializedspecializedtrainingtrainingtrainingtraining for retailsalespeople.Thisbackgroundhelpssalespeopleexplainfeatures,competitiveadvantages, and otherinformationtoconsumers.Trainingcanbeprovidedinseveralways:Amanufacturer’ssalesrepresentativecanconducttrainingsessionsduringregularsalescalls,orthefirmcandistributesalesliterature and videocassettes.SalesSalesSalesSalesForceForceForceForce Promotion: Promotion: Promotion: Promotion: Salesforce promotion isdirectedatthecompany’sownsalesforce(oftentimesthemanufacturer’ssalesforce)—ratherthanabusinesscustomer’ssalesforcewhichisinthedistributionchannel,suchasaretailer’ssalesforce.Contests, for example,couldbeusedtourgethesalesforcetoincreasetheirefforts,withprizesgoingtothetopperformers.Asalessalessalessalescontestcontestcontestcontestisacontest for salespeopletomotivatethemtoincreasetheirsalesperformanceoveragivenperiod.Salescontestsmotivate and recognizegoodcompanyperformers,whomayreceivetrips,cashprizes,orothergifts.Salescontestsworkbestwhentheyaretiedtomeasurable and achievablesalesobjectives.Otherincentivescouldalsobeprovidedtoencouragethesalesforcetoincreasenewaccountsinadditiontoboostingsales.PersonalPersonalPersonalPersonalSelling:Selling:Selling:Selling:PersonalPersonalPersonalPersonalsellingsellingsellingsellingispromotionalpresentationbythefirm’ssalesforceconductedonaperson-to-personbasiswiththebuyer for thepurposeofmakingsales and buildingcustomerrelationships.Personalsellingistheoldestformof promotion. Thisdirectformof promotion maybeconductedface-to-face,overthetelephone,throughvideoconferencing,orthroughinteractivecomputerlinksbetweenthebuyer and theseller.Thisdirectcontactwiththecustomergivesthesalespersontheopportunitytobeflexible and modifythesalesmessagetocoincidewiththecustomer’sneeds.Thesalespersoncangetimmediatefeedbackfromthecustomer.Thisformof promotion hasahighcostpercontactwiththecustomer.Theaveragesalescallcostsabout$300.Itisdifficulttoensureconsistencyofmessagewhenitisdeliveredbymanydifferentcompanyrepresentatives.Thecredibilityofsalespeopleoftendependsonthequalityoftheircompany’simage,whichhasbeencreatedbyother promotion strategies.About14millionpeopleintheU.S.areemployedinpersonalselling.Today,mostsalespeoplearewell-educated,well-trainedprofessionalswhoworktobuild and maintainlong-termcustomerrelationshipsbylisteningtotheircustomers,assessingcustomerneeds, and organizingthecompany’seffortstosolvecustomerproblems.Thetermsalespersoncoversawiderangeofpositions.Atoneextreme,asalespersonmightbelargelyanordertaker,suchasadepartmentstoresalespersonstandingbehindacounter.Attheotherextremeareordergetters,whosepositionsdemandthecreativesellingofproductsrangingfromappliances,industrialequipment, and airplanestoinsurance,advertising, and informationtechnologyservices.TheTheTheTheRoleRoleRoleRoleofofofofPersonalPersonalPersonalPersonalSelling:Selling:Selling:Selling:Generally,apersonalsaleseffortismoreimportantwhenafirmengagesinapushstrategy,inwhichthegoalistopushtheproductthroughthedistributionchannelsothatitisavailabletoconsumers.PersonalsellingalsoislikelytobecrucialinB2Bcontextswhendirectinteractionwithupper-levelmanagementisrequiredtosecureanimportantsale— and oftenwhenintensepricenegotiationsoccurbeforethesaleismade.Inaddition,inexperiencedbuyersmayneedthehands-onassistancethataprofessionalsalespersoncanprovide.Firmssellingproductsthatconsumersbuyinfrequently,suchascomputers,lawnmowers, and collegeeducations,oftenrelyheavilyonpersonalselling,asdofirmssellingcomplexorveryexpensiveproductsthatneedasalespersontoexplain,justify, and sellthem.Personalselling,however,hassomedisadvantagesthatlimittheroleplayedbypersonalsellinginthe promotion mix.First,whenthedollaramountofindividualpurchasesislow,itisn’teconomicallyfeasibletousepersonalselling.Thecostpercontactwithacustomerishighcomparedtootherformsofcommunication,suchasadvertising.Salespeoplecanalsoonlymakealimitednumberofsalescallsaday.Relianceonpersonalsellingiseffectiveonlywhenthesuccessratioisatitshighest.Becausethecostofutilizingsalespeopleishigh,telemarketingisgrowinginpopularity.Thetypesofsalespeople and theirfunctionsvaryconsiderably.Thepersonwhoprocessesacomputerpurchaseoverthephoneisanorderorderorderordertakertakertakertaker,asalespersonwhoseprimaryfunctionistofacilitatetransactionsthatthecustomerinitiates.Ordertakersincludebothinside and outsidesalespeople.Mostretailsalespeopleareinsideordertakers,butoftenwholesalers,dealers, and distributorsemploysalespeopletowaitoncustomers.Incontrast,acomputertechnicianisatechnicaltechnicaltechnicaltechnicalspecialistspecialistspecialistspecialist,asalessupportpersonwithahighleveloftechnicalexpertisewhoassistsinproductdemonstrations,recommendations for complexequipment, and setupofmachinery.Thetechnicalspecialist’sjobistoprovidesalessupportratherthanactuallyclosingthesale.Thetechnicalspecialistpromotesthefirm and triestostimulatedemand for aproducttomakeiteasier for colleaguestoactuallymakethesale.Sometimesapersonwhosejobistolaythegroundworkisknownasamissionarymissionarymissionarymissionarysalespersonsalespersonsalespersonsalesperson.Thisisasalespersonwhopromotesthefirm and triestostimulatedemand for aproduct,butdoesnotactuallycompleteasale.Manyfirmsfindthatthesellingfunctionisbesthandledbyteamteamteamteamsellingsellingsellingselling,usingteamsofpeoplefromsales,marketing,engineering,finance,technicalsupport, and evenuppermanagementtoservicelarge,complexaccounts.Finally,thepersonwhoactuallyconvincesthecustomertobuyisanorderorderorderordergettergettergettergetter,asalespersonwhoworkscreativelytodeveloprelationshipswithcustomersortogeneratenewsales.ApproachesApproachesApproachesApproachestotototoPersonalPersonalPersonalPersonalSelling:Selling:Selling:Selling:Personalsellingisoneoftheoldestformsof promotion, butitsimagehasbeentarnishedbysmooth-talkingpitchmenwhohavesometimessaidanythingtomakeasale.Inmorerecentyears,personalsellinghasbeguntoredeemitselfasaprofession and hasmovedfromatransactional,hard-selltechniquetoarelationshipmarketingapproach.TransactionalMarketingThehardsellisahigh-pressureprocess.Hard-selltacticsareaformoftransactionaltransactionaltransactionaltransactionalsellingsellingsellingselling,aformofpersonalsellingthatfocusesonmakinganimmediatesalewithlittleornoattempttodeveloparelationshipwiththecustomer.Ascustomers,thehardsellmakesusfeelmanipulated and resentful.Thistechniquealsocontributestothenegativeimagemanyofushaveofobnoxioussalespeople.RelationshipMarketingToday’sprofessionalsalespersonismorelikelytopracticerelationshiprelationshiprelationshiprelationshipsellingsellingsellingselling,aformofpersonalsellinginwhichthesalespersonseekstodevelopamutuallysatisfyingrelationshipwiththeconsumer.Relationshipsellinginvolveswinning,keeping, and developingcustomers.Winningacustomermeansconvertinganinterestedprospectintosomeonewhoisconvincedthattheproductholdsvalue for himorher.Keepingacustomermeansensuringthatthecustomergetswhatheorshepaid for. Developingacustomermeanssatisfyingthecustomersothatheorshewillbecountedontoprovidefuturebusiness.Theprofessionalsalespersonwhogenuinelyadherestotheprinciplesofrelationshipmarketingisarelationshipbuilder and acustomerproblemsolver.TheTheTheTheCreativeCreativeCreativeCreativeSellingSellingSellingSellingProcess:Process:Process:Process:Sellingisseldomboring.Everycustomer,everysalescall, and everysalespersonareunique.Somesalespeoplearesuccessfulprimarilybecausetheyknowsomuchaboutwhattheysell.Othersaresuccessfulbecausetheyhavebuiltstrongrelationshipswithcustomerswholookforwardtotheirvisits.Mostsalespeopleunderstand and engageinaseriesofactivitiesnecessarytobringaboutatransaction.Complexorexpensivesalesrequirecarefulplanning, and successfulsellinginthesecasesismorelikelyifthesalespersonundergoesasystematicseriesofstepsknownasthecreativecreativecreativecreativesellingsellingsellingsellingprocessprocessprocessprocess.Thesestepsrequirethesalespersontoseekoutcustomers,analyzetheirneeds,determinehowproductattributesprovidebenefits, and thendecidehowbesttocommunicatethistotheprospects.Thestepsintheprocessincludeprospecting,qualifying,preapproach,approach,salespresentation,demonstration,handlingobjections,closing, and follow-up.ProspectingProspectingProspectingProspectingProspectingisthestepofthesellingprocessthatincludesidentifying and developingalistofpotentialorprospectivecustomers.Prospectsorsalesleadscancomefromexistingcustomerlists,telephonedirectories,orcommerciallyavailabledatabases.Sometimescompaniesgeneratesalesleadsthroughtheiradvertisingorsalespromotionsbylettingcustomersrequestmoreinformation.Onewaytogenerateleadsisthroughcoldcalling,whenthesalespersoncontactsprospectswithoutpriorintroductionorarrangement.Salespeoplealsorelyonreferrals.Currentclientswhoaresatisfiedwiththeirpurchaseoftengivereferrals.QualifyingSalespeoplenextneedtoqualifyqualifyqualifyqualifytheirprospectsprospectsprospectsprospects,thestepofthesellingprocessthatdetermineshowlikelyprospectsaretobecomecustomers.Prospectscanbequalifiedbylookingattheirfinancialability,volumeofbusiness,specialneeds,location, and possibilities for growth.PreapproachThepreapproachpreapproachpreapproachpreapproachisthestepinthesellingprocessinwhichthesalespersonlearnsasmuchaspossibleaboutaprospectivecustomerbeforemakingasalescall.Salespeopletrytolearnasmuchaspossibleaboutqualifiedprospectsearlyon.Theymayprobepriorpurchasehistory,currentneeds,orinformationabouttheirinterests.Thesalespersoncanconsultindustry and onlinesources,acquaintances,etc.tolearnabouttheprospect.Anothertaskistodecideonthebestapproach,whichmightbeapersonalvisit,aphonecall,oraletter.Thebesttimingshouldbeconsideredcarefullybecausemanyprospectsarebusiestatcertaintimes.Finally,thesalespersonshouldgivethoughttoanoverallsalesstrategy for theaccount.ApproachTheapproachapproachapproachapproachisthestepinthesellingprocessinwhichthesalespersonusuallymeetsthecustomer for thefirsttime.Heorsheshouldstartbuildingtherelationshipduringtheapproach.Thesalespersonshouldknowhowtomeet and greettheprospect and gettherelationshipofftoagoodstart.Thisstepinvolvesthesalesperson’sappearance,openinglines, and thefollow-upremarks.Theopeninglinesshouldbepositivetobuildgoodwillfromthebeginningoftherelationship.Ifthesalespersonmadecontactwiththeprospectthroughareferral,thesalespersonshouldprobablysaysoup-front.Thisopeningmightbefollowedbysomekeyquestionstolearnmoreaboutthecustomer’sneedsorbyshowingadisplayorsampletoattracttheprospect’sattention and curiosity.Asinallstagesofthesellingprocess,listeningtothecustomeriscrucial.SalesPresentationThesalessalessalessalespresentationpresentationpresentationpresentationisthestepinthesellingprocessinwhichthesalespersonseekstopersuasivelycommunicatetheproduct’sfeatures and thebenefitsitwillprovideafterthesale.Proofstatements,suchasdataonpastsales,testimonials,guarantees,orresearchresults,helptomakethesalesperson’spresentationcredible.Somesalespresentationsarecanned,meaningascripthasbeenwritteninadvance, and thesamemessageisdeliveredtomanyprospects.Thistechniqueoftenprovidesaseriesofverbalpromptstowhichthereareexpectedcustomerresponses.Asimilarapproachcalledaformulatedapproachidentifiesaprospect’sneeds and thenprovidesascriptedsalespitchkeyedtothatkindofprospect.Thesestandardizedapproachesworkfineinsomecases,butthemosteffectivesalespresentationsarethosethataretailoredtothespecificcustomer.Increasingly,salespresentationsaregoinghigh-tech.Computer-basedmultimediapresentationsareconsideredthenextwaveinsales-forceautomation.Withamultimedia-readynotebookcomputerorLCDprojectioncomputer,salespeoplecanbringcolor,animation,video,audio, and interactivity—aswellasthelatestproduct and pricinginformation—totheirpresentations.DemonstrationOneimportantadvantageofpersonalsellingovermostadvertisingistheabilityofsalespeopletoprovideademonstrationdemonstrationdemonstrationdemonstrationoftheproducttothepotentialbuyer.Manyfirmsusenewtechnologiestomaketheirdemonstrationsmoreeffective.Multimediainteractivedemonstrationsarenowcommon.Thekeytoagooddemonstration—onethatgainsthecustomer’sattention,keepshisorherinterest,isconvincing, and staysinthecustomer’smemory—isplanning.Thesalespersonshouldcheck and recheckallaspectsofthedemonstrationpriortoitsdelivery.HandlingObjectionsHandlingHandlingHandlingHandlingobjectionsobjectionsobjectionsobjectionsisthestepinthesellingprocessinwhichthesalespersonseeksout,clarifies, and overcomescustomerobjectionstobuying.Customersalmostalwayshaveobjectionsduringthepresentationorwhenaskedtoplaceanorder.Theproblemcanbeeitherlogicalorpsychological, and objectionsareoftentimesunspoken.Thesalespersonshouldhandleobjectionsusingapositiveapproach,byseekingouthiddenobjections,askingtheprospecttoclarifyanyobjections, and takingobjectionsasopportunitiestoprovidemoreinformation—turningtheobjectionsintoreasons for buying.Everysalespersonneedstrainingintheskillsofhandlingobjections.ClosingClosingClosingClosingClosingisthestepinthesellingprocessinwhichthesalespersonasksthecustomer for anorder.Somesalespeopledonotgetaroundtoclosingordonothandleitwell.Theymaylackconfidence,feelguiltyaboutasking for theorder,orfailtorecognizetherightmomenttoclosethesale.Salespeopleshouldknowhowtorecognizeclosingsignalsfromthebuyer,includingbodylanguage,comments, and questions.Salespeoplecanuseseveralclosingtechniques.Theycanask for theorder,reviewpointsofagreement,offertohelpwriteuptheorder,askwhethertheybuyerwantsthismodelorthatone,ornotethatthebuyerwillloseoutiftheorderisnotplacednow.Thesalespersonmayalsoofferthebuyerspecialreasonstoclose,suchasalowerpriceoranextraquantityatnocharge.Follow-UpFollow-upFollow-upFollow-upFollow-upisthelaststepinthesellingprocess,inwhichthesalespersonfollowsupafterthesaletoensurecustomersatisfaction and repeatbusiness.Rightafterclosing,thesalespersonshouldcompleteanydetailsondeliverytime,purchaseterms, and othermatters.Thesalespersonthenshouldscheduleafollow-upcallwhentheinitialorderisreceived,tomakesurethereisproperinstallation,instruction, and/ orservicing.Thisvisitshouldrevealanyproblems,assurethebuyerofthesalesperson’sinterest, and reduceanybuyerconcernsthatmighthavearisensincethesale.Follow-upalsoallowsthesalespersontobridgetothenextpurchase.Oncearelationshipdevelops,thesellingprocessisonlythebeginning.Evenasonecycleofpurchasingdrawstoaclose,agoodsalespersonisalreadylayingthefoundation for thenextone.SalesSalesSalesSalesManagement:Management:Management:Management:SalesSalesSalesSalesmanagementmanagementmanagementmanagementistheprocessofplanning,implementing, and controllingthepersonalsellingfunctionofanorganization.Personalsellingisateameffortthatrequirescarefulplanning and salespeopleinthefieldwhen and wherecustomersneedthem.SalesForceObjectivesSalesforceobjectivesstatewhatthesalesforceisexpectedtoaccomplish and when.Thesegoalscouldincludeacquiringnewcustomers,generatingspecificamountsofsalesvolume,reducingsalesexpenses,improvingcustomersatisfaction,gatheringnew-productsuggestions,traininggoals, and communityinvolvementgoals.Salesmanagersalsoworkwiththeirsalespeopletodevelopindividualgoals.Performancegoalsaremeasurableoutcomes,suchastotalsales and totalprofitspersalesperson.Behavioralgoalsspecifyactionssalespeoplemustaccomplish,suchasthenumberofprospectstoidentify,thenumberofsalescalls, and thenumberofsalespresentations.SalesForceStrategyAsalesforcestrategyspecifiesthestructure and sizeofafirm’ssalesforce.Eachsalespersonhastheresponsibility for asetgroupofcustomers—thesalessalessalessalesterritoryterritoryterritoryterritory.Theterritorystructureallowssalespeopletohaveanin-depthunderstandingofcustomers and theirneedsthroughfrequentcontacts.Themostcommonwaytoallotterritoriesisgeographically,minimizingtravel and otherfieldexpenses.Ageographicsalesforcestructureusuallyissizedaccordingtohowmanycustomersarefoundinagivenarea.Iftheproductlineisdiverseortechnicallycomplex,abetterapproachmaybetostructuresalesterritoriesbasedondifferentclassesofproductstoenablethesalesforcetoprovidemoreexpertisetoasetofcustomerswithsimilarneeds.Stillanotherstructureisindustryspecialization,inwhichsalespeoplefocusonasingleindustryorasmallnumberofindustries.Puttingasalespersonintothefieldisexpensive,sothenumberofpeopleinthesalesforcehasanimpactonacompany’sprofitability.Determiningtheoptimalnumberofsalespeopleisanimportantdecision.Recruiting,Selecting,&TrainingtheSalesForceBecausethequalityofasalesforcecanmakeorbreakafirm,atoppriority for salesmanagersistorecruit and selecttherightsetofpeopletodothejob—peoplewhoarestrategicthinkers,whohavetechnicalknowledgepertainingtotheindustry, and whohaveexcellentinterpersonalskills.Companiesscreenpotentialsalespeopletorevealtheseskills,alongwithusefulinformationaboutinterests and capabilities.Pencil -and- papertestscandeterminequantitativeskills and competenceinareasnoteasilyevaluatedthroughinterviews.Salestrainingteachessalespeopleabouttheorganization and itsproducts and howtodeveloptherightskills,knowledge, and attitudes.Newsalespeoplemayspendanywherefromafewweeksormonthstoayearormoreintraining.Theaverageinitialtrainingperiodisfourmonths.Then,mostcompaniesprovidecontinuingsalestrainingviaseminars,salesmeetings, and theInternetthroughoutthesalesperson’scareer.Compensating,Motivating, and SupervisingtheSalesForceOnewaytomotivatesalespeopleistopaythemwell,oftentimesbytyingcompensationtoperformance.Astraightcommissionplanisbasedsolelyonapercentageofsalesthepersoncloses.Underacommission-with-drawplan,earningsarebasedoncommissionplusaregularpayment,or“draw,”thatmaybechargedagainstfuturecommissionsifcurrentsalesareinadequatetocoverthedraw.Withastraightsalarycompensationplan,thesalespersonispaidasetamountregardlessofsalesperformance.Sometimesstraightsalaryplansareaugmentedbyuseofaquota-bonusplan,inwhichsalespeoplearepaidsalaryplusabonus for salesaboveanassignedquota.Inadditiontobasiccompensation,manymanagersfindthatavarietyofotherincentivescanalsoenhancethesalesforceefforttremendously.Suchincentivescanrangefromfreevacationstoextracash.Althoughmanysalespeopleliketoworkindependently,supervisionisessentialtoaneffectivesalesforce.Salesmanagersoftenrequiresalespeopletodevelopmonthly,weekly,ordailycallreports,aplanofactiondetailingwhichcustomerswerecalledon and howthingswent.Thesereportsallowthesalesmanagertotrackwhatthesalespeoplearedoinginthefield, and theyprovidemarketingmanagerswithtimelyinformationaboutcustomers’responses,competitiveactivity, and anychangesinthefirm’scustomerbase.EvaluatingtheSalesForceThejobofsalesmanagersisnotcompleteuntilthetotaleffortofthesalesforceisevaluated.First,itisimportanttodetermineifthesalesfunctionismeetingitsquantitativeobjectives.Ifnot,thesalesmanagermustfigureoutthecauses.Individualsalespersonperformanceisnormallymeasuredagainstsalesquotas for individualsalesterritories,evenwhencompensationplansdonotincludebonusesorcommissionsbasedonquotas.Otherquantitativemeasures,suchasnumberofsalescalls and salesreports,mayalsobeusedintheevaluation.Manyfirmsalsoevaluatetheirsalesforceonqualitativeindicatorsofperformancesuchassalespersonattitude,productknowledge, and communicationskills.Increasingly,asfirmsfocusonrelationshipmanagement,thelevelofcustomersatisfactionisastrongqualitativemeasureofsuperiorsalespersonperformance.Finally,thesalesperson’sexpenseaccount for travel and entertainment(T&E)maybeconsideredsincethebestsalesrecordcanmeanlittletoacompany’sbottomlineifthesalespersonisgougingthecompanywithoutrageousexpenses.Note:TheabovelecturenoteswerecompiledbyDavidGerth.Thesematerialsareacompositeofquotations,paraphrases, and ideasfromMarketing:RealPeople,RealChoices,Solomon&Stuart,2003,PrenticeHall;ContemporaryMarketing,Boone&Kurtz,2004,Thomson;PrinciplesofMarketing,Kotler&Armstrong,2004,PrenticeHall; and DavidGerth.Theyareonlyintended for thenoncommercialuseofstudentsinDavidGerth’smarketingclasses for educationalpurposes.othergroupsaboutmarketingconcerns and canbeeitherproactiveorreactive.Withproactivemarketing public relations ,themarketertakestheinitiative and seeksoutopportunities for promotingthefirm’sproducts,oftenincludingdistributionof press releases and featurearticles.Itisapowerfulmarketingtoolsinceitaddsnewscoveragethatreinforcesdirect promotion activities.Althoughsomepublicityhappensnaturally,moretypicallya“buzz”needstobecreatedbyafirm’spublicists.Reactivemarketing public relations respondstoanexternalsituationthathaspotentialnegativeconsequences for theorganization.Thegoalinthiscaseistomanagetheflowofinformationtoaddressconcernssothatconsumersdon’tpanic and distributorsdon’tabandontheproduct.TheInternethasexpandedthecapabilitiesofthetraditional public relations function.Corporatewebsitesposttestimonialsfromcustomers,makenewproductannouncements, and respondquicklytoimportantevents.Newsreleasespostedonthecompanywebsitemaydoubleassalesvehicles.TheInternetcanalsobeveryeffectiveinhandlingcompanycrises.WithahostofInternetnewssites,companiescanrespondtoacrisisonlineinfarlesstimethanotherformsofcommunicationsuchas press releasesorconferences. Public Public Public Public Relations Relations Relations RelationsObjectives:Objectives:Objectives:Objectives: Public relations specialistsneedtooperateatmanylevelstoensurethatvariouspublicsofacompanyreceivecoordinated,positivemessagesaboutthefirm.Thesegroupsincludecustomers,suppliers,employees,themedia,stockholders, and governmentregulators.Companiesthatpracticeintegratedmarketingcommunicationstrategiesknowthat public relations strategiesarebestusedinconcertwithadvertising,sales promotion, and personalsellinginordertosendaconsistentmessagetocustomers and otherstakeholders.AspartofthetotalIMCplan, public relations departmentsmayperformanyorallofthefollowingfunctionstoachievecommunicationsobjectives:• Public Affairs–Building and maintainingnationalorlocalcommunity relations. •Lobbying–Building and maintaining relations withlegislators and governmentofficialstoinfluencelegislation and regulation.•Investor Relations –Maintainingrelationshipswithshareholders and othersinthefinancialcommunity.•Development– Public relations withdonorsormembersofnonprofitorganizationstogainfinancialorvolunteersupport.•LocationPR–Enhancingtheimageofacity,region,orcountry.• Press Relations –Creating and placingnewsworthyinformationinthenewsmediatoattractattentiontoapersonorproduct.•ProductPublicity–Publicizingspecificproductstoconsumersaswellasotherorganizations. Public Public Public Public Relations Relations Relations RelationsTools:Tools:Tools:Tools: Public relations professionalsuseseveraltools.Theyuse:•News,•Speeches,•SpecialEvents,•MobileMarketing,•WrittenMaterials,•AudiovisualMaterials,•CorporateIdentityMaterials, and • Public ServiceActivities.Oneofthemajortoolsisnews.PRprofessionalsfindorcreatefavorablenewsabouttheorganization and itsproductsorpeople.Speechescanalsocreateproduct and companypublicity.Increasingly,companyexecutivesmustfieldquestionsfromthemediaorgivetalksattradeassociationsorsalesmeetings.AnothercommonPRtoolisspecialevents,rangingfromnewsconferences, press tours,grandopenings, and fireworksdisplaystolasershows,hotairballoonreleases,multimediapresentations and star-studdedspectaculars, and educationalprogramsdesignedtoreach and interesttargetpublics.Recently,mobilemarketing—travelingpromotionaltoursthatbringthebrandtoconsumers—hasemergedasaneffectivewaytobuildone-to-onerelationshipswithtargetedconsumers. Public relations peoplealsopreparewrittenmaterialstoreach and influencetheirtargetmarkets.Thesematerialsincludeannualreports,brochures,articles, and companynewsletters and magazines.Audiovisualmaterials,suchasfilms,slide -and- soundprograms, and video- and audiocassettes,arebeingusedincreasinglyascommunicationtools.Corporateidentitymaterialscanalsohelpcreateacorporateidentitythatthe public immediatelyrecognizes.Logos,stationery,brochures,signs,businessforms,businesscards,buildings,uniforms, and companycars and trucks—allbecomemarketingtoolswhentheyareattractive,distinctive, and memorable.Finally,companiescanimprove public goodwillbycontributingmoney and timeto public serviceactivities.PlanningPlanningPlanningPlanningaaaa Public Public Public Public Relations Relations Relations RelationsCampaign:Campaign:Campaign:Campaign:A public relations campaignisacoordinatedefforttocommunicatewithoneormoreoftheorganization’spublics.Thisisathree-stepprocessof:1.DevelopingObjectives,2.Executing, and 3.Evaluating.Theorganizationmustfirstdevelopclearobjectives for thePRprogramthatdefinethemessageitwantspeopletohear.ThePRspecialistsmustdevelopacampaignstrategythatincludes:•astatementofobjectives;•asituationanalysis;•specificationoftargetpublics,messagestobecommunicated, and specificprogramelementstobeused;•atimetable and budget; and •adiscussionofhowtheprogramwillbeevaluated.Executionofthecampaignmeansdecidingpreciselyhowthemessageshouldbecommunicatedtothetargetedpublics and implementingthedecisions.Anorganizationcanuseavarietyof public relations tools:newsconferences,specialevents,writtenmaterials,etc.Oneofthebarrierstogreaterrelianceon public relations campaignsisthedifficultyencounteredwhentryingtogaugetheireffectiveness.ItispossibletotellifaPRcampaignisgettingmediaexposure,thoughit’smoredifficulttogaugebottom-lineimpact.In-houseassessments,awareness and preferenceresearchstudies, and themeasurementofprint and broadcastcoveragegeneratedbyPRactivitiesaswellasimpressioncountscanbeusedinthePRcampaignevaluation.SalesSalesSalesSales Promotion: Promotion: Promotion: Promotion: SalesSalesSalesSales Promotion Promotion Promotion Promotionistheuseofshort-termincentivestoencouragethepurchaseorsaleofaproduct.Salespromotionsareprogramssuchascontests,coupons,displays,tradeshows,samples,premiums,productdemonstrations,orotherincentivesthatmarketersdesigntobuildinterestinorencouragepurchaseofaproductduringaspecifiedtimeperiod.Salespromotionsareintendedtostimulateimmediateaction,oftenintheformofapurchase,ratherthantobuildlong-termloyalty.Whereasadvertising and personalsellingofferreasonstobuyaproduct,sales promotion offersreasonstobuynow.Sales promotion gearedtomarketingintermediariesiscalledtradetradetradetrade promotion promotion promotion promotion.Companiesactuallyspendaboutasmuchontrade promotion asonadvertising and consumer-orientedsales promotion combined.Trade promotion strategiesincludeofferingfreemerchandise,buybackallowances, and merchandiseallowancesalongwithsponsorshipofsalesconteststoencouragewholesalers and retailerstosellmoreofcertainproductsorproductlines.Sales promotion toolsareusedbymostorganizations,includingmanufacturers,distributors,retailers,tradeassociations, and not -for- profitinstitutions.Theyaretargetedtowardfinalbuyers,retailers and wholesalers,businesscustomers, and membersofthesalesforce.Severalfactorshavecontributedtotherapidgrowthofsales promotion, particularlyinconsumermarkets.First,insidethecompany,productmanagersfacegreaterpressurestoincreasetheircurrentsales; and sales promotion isviewedasaneffectiveshort-runsalestool.Second,externally,thecompanyfacesmorecompetition; and competingbrandsarelessdifferentiated.Increasingly,competitorsareusingsales promotion tohelpdifferentiatetheiroffers.Third,advertisingefficiencyhasdeclinedbecauseofrisingcosts,mediaclutter, and legalconstraints.Finally,consumershavebecomemoredealoriented, and ever-largerretailersaredemandingmoredealsfrommanufacturers.Thegrowinguseofsales promotion hasresultedin promotion clutter,similartoadvertisingclutter,however.Consumersareincreasinglytuningoutsalespromotions,weakeningtheirabilitytotriggerimmediatepurchase.Manufacturersarenowsearching for waystoriseabovetheclutter,suchasofferinglargercouponvaluesorcreatingmoredramaticpoint-ofpurchasedisplays.SalesSalesSalesSales Promotion Promotion Promotion PromotionObjectives:Objectives:Objectives:Objectives:Sales promotion objectivesdifferwidely:•IncreaseShort-TermSales(consumer promotion) •BuildLong-TermMarketShare(consumer promotion) •EncourageRetailerstoCarryNewItems and AdditionalInventory(trade promotion) •EncourageRetailerstoAdvertise and ProvideMoreShelfSpace(trade promotion) •EncourageRetailerstoBuyAhead(trade promotion) •IncreaseSalesForceSupport(salesforce promotion) •IncreaseNumberofNewAccounts(salesforce promotion) Sellersmayuseconsumerpromotionstoincreaseshort-termsalesortohelpbuildlong-termmarketshare.Objectives for tradepromotionsincludegettingretailerstocarrynewitems and moreinventory,gettingthemtoadvertisetheproduct and giveitmoreshelfspace, and gettingthemtobuyahead.Salesforce promotion objectivesincludegettingmoresalesforcesupport for currentornewproductsorgettingsalespeopletosignupnewaccounts.Salespromotionsareusuallyusedtogetherwithadvertising,personalselling,orother promotion mixtools.Consumerpromotionsmustusuallybeadvertised and canaddexcitement and pullingpowertoads.Trade and salesforcepromotionssupportthefirm’spersonalsellingprocess.Ingeneral,ratherthancreatingonlyshort-termsalesortemporarybrandswitching,salespromotionsshouldhelptoreinforcetheproduct’sposition and buildlong-termcustomerrelationships.Increasingly,marketersareavoiding“quickfix,”price-onlypromotionsinfavorofpromotionsdesignedtobuildbrandequity.Consumer-OrientedConsumer-OrientedConsumer-OrientedConsumer-OrientedSalesSalesSalesSales Promotion: Promotion: Promotion: Promotion: Themainconsumer promotion toolsincludesamples,coupons,cashrefunds,pricepacks,premiums,advertisingspecialties,patronagerewards,point-of-purchasedisplays and demonstrations, and contests,sweepstakes, and games.Consumer-orientedsalespromotionscanbeclassifiedaseitherprice-basedorattention-gettingconsumer promotion. Price-BasedConsumer Promotion Price-basedconsumerpromotionsemphasizeshort-termpricereductionsorrefunds,encouragingconsumerstochooseabrandwhilethedealison.Ifusedtoofrequently,however,consumersbecomeconditionedtopurchasetheproductonlyatthelowerpromotionalprice.CouponsAcouponcouponcouponcouponisacertificatethatgivesbuyersasavingwhentheypurchaseaspecifiedproduct.Couponscanstimulatesalesofamaturebrandorpromoteearlytrialofanewbrand.Redemptionrateshavebeendeclininginrecentyears,however,asaresultofcouponclutter.Mostmajorconsumergoodscompaniesareissuingfewercoupons and targetingthemmorecarefully.Theyarealsocultivatingnewoutlets for distributingcoupons,suchassupermarketshelfdispensers,electronicpoint-of-salecouponprinters,or“paperlesscouponsystems.”CashRebateOffersAcashcashcashcashrebaterebaterebaterebateisanoffertorefundpartofthepurchasepriceofaproducttoconsumerswhosenda“proofofpurchase”tothemanufacturer.PricePacksApricepricepricepricepackpackpackpackisareducedpricethatismarkedbytheproducerdirectlyonthelabelorpackage.Pricepackscanbesinglepackagessoldatareducedprice,ortworelatedproductsbandedtogether.Pricepacksareveryeffective—evenmoresothancoupons—instimulatingshort-termsales.PatronageRewardsApatronagepatronagepatronagepatronagerewardrewardrewardrewardiscashorotheraward for theregularuseofacertaincompany’sproducts.SpecialPacksAspecialspecialspecialspecialpackpackpackpackisapackagethatgivestheshoppermoreproductinsteadofloweringitsprice.Aspecialpackalsocanbeaseparateproductgivenawayalongwithanotherproduct.Attention-GettingConsumer Promotion Attention-gettingconsumerpromotionsstimulateinterestin and publicity for acompany’sproducts.SamplesAsamplesamplesamplesampleisasmallamountofaproductofferedtoconsumers for trial.Samplingisthemosteffective—butmostexpensive—waytointroduceanewproduct.About84percentofconsumerpackaged-goodsmarketersusesamplingasapartoftheir promotion strategy.Somesamplesarefree; for others,companieschargeasmallamounttooffsetitscost.Thesamplemightbedelivereddoor-to-door,sentbymail,handedoutinastore,attachedtoanotherproduct,orfeaturedinanad.Samplescanalsocomewiththemorningnewspaper,inasamplepack,orviatheInternet.PremiumsApremiumpremiumpremiumpremiumisagoodofferedeitherfreeoratlowcostasanincentivetobuyaproduct.Apremiumisnottheproductbeingpromoted.Itisusedasanincentivetoencouragepurchaseofthefeaturedproduct.Apremiummaycomeinsideoroutsidethepackage,orthroughthemail.AdvertisingSpecialtiesAnadvertisingadvertisingadvertisingadvertisingspecialtyspecialtyspecialtyspecialtyisausefularticleimprintedwithanadvertiser’sname,givenasagifttoconsumers.Typicalitemsincludepens,calendars,keyrings,matches,shoppingbags,T-shirts,caps,nailfiles, and coffeemugs.Inarecentstudy,63percentofallconsumerssurveyedwereeithercarryingorwearinganadspecialtyitem.Morethanthree-quartersofthosewhohadanitemcouldrecalltheadvertiser’snameormessagebeforeshowingtheitemtotheinterviewer.Point-of-Purchase(POP)Promotions...