concept based notes sales promotion and sales...

Biyani's Think Tank

Concept based notes

Sales Promotion and Sales

Management (B.Com. Part-III)

Nandita Sarsar

Revised by: Ms Chitrangi

Lecturer

Deptt. of Commerce (Mgmt)

Biyani Girls College, Jaipur

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Published by :

Think Tanks Biyani Group of Colleges

Concept & Copyright :

Biyani Shikshan Samiti Sector-3, Vidhyadhar Nagar, Jaipur-302 023 (Rajasthan)

Ph : 0141-2338371, 2338591-95 Fax : 0141-2338007 E-mail : [email protected] Website : www.biyanithinktank.com; www.biyanicolleges.org First Edition : 2009 Second Edition: 2011 Price:

Leaser Type Setted by : Biyani College Printing Department

While every effort is taken to avoid errors or omissions in this Publication, any mistake or

omission that may have crept in is not intentional. It may be taken note of that neither the

publisher nor the author will be responsible for any damage or loss of any kind arising to

anyone in any manner on account of such errors and omissions.

Sales Promotion and Sales Management

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Preface

am glad to present this book, especially designed to serve the needs of the students.

The book has been written keeping in mind the general weakness in understanding the

fundamental concepts of the topics. The book is self-explanatory and adopts the

“Teach Yourself” style. It is based on question-answer pattern. The language of book is

quite easy and understandable based on scientific approach.

I any further improvement in the contents of the book by making corrections, omission

and inclusion in keen to be achieved based on suggestions from the readers for which the

author shall be obliged.

I acknowledge special thanks to Mr. Rajeev Biyani, Chairman & Dr. Sanjay Biyani,

Director (Acad.), Biyani‟s Group of Colleges, who are the backbones and main concept

provider and also have been constant source of motivation throughout this endeavour. I

also extend my thanks to Biyani Shikshan Samiti, Jaipur, who played an active role in

coordinating the various stages of this endeavour and spearheaded the publishing work.

I also want to thank Ms. Shivani Singh and Ms. Swati Singh for her support and guidance

during my writing work.

I look forward to receiving valuable suggestions from professors of various educational

institutions, other faculty members and students for improvement of the quality of the

book. The reader may feel free to send in their comments and suggestions to the under

mentioned address.

Author

I

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Contents

S. No. Name of Topic

1. Sales Promotion

2. Recruitment, Selection & Motivation

3. Sales Forecasting, quotas & Territories

4. Unsolved Paper 2011 to 2006


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Section –A

Sales Promotion

You cannot offer your valued customers any better Thank You,

or have a better environment for sales promotion.

~ John Garwood

Q.1 Define sales promotion? What is the nature, role & importance of sales

promotion?

OR

What is sales promotion? Discuss the nature, role & importance of sales

promotion.

Ans.: Sales promotion is a key factor & strategy for marketers within the promotional

mix. Sales promotion refers to many kinds of incentives & techniques directed

towards consumers & traders with the intention to produce immediate or short

term effects. Sales promotion helps in stimulating trial or purchase by final

customers or others in the channel. A marketer can increase the value of its

product by offering an extra incentive to purchase a product or brand. A few

definitions are quoted below:-

1. American Marketing Association – “Sales promotion is media & non media

marketing pressure applied for a predetermined, limited period of time in order to

stimulate trial & impulse purchases, increase consumer demand or improve

product quality”.

2. Council of Sales Promotion Agencies – “Sales promotion is a marketing

discipline that utilizes a variety of incentives, techniques to structure sales related

programs targeted to consumers/traders/ and or sales level, that generate a specific

measurable action or response for a product/service”.

3. Institute of Sales Promotion, U.K. – “Sales promotion comprises that range of

techniques used to attain sales/marketing objectives by cost effective manner

adding value to a product or service either to intermediate or end users, normally

but not exclusively within a definite time period”.

http://www.quotesea.com/quote/youcannotofferyourvaluedcustomersanybette

http://www.quotesea.com/quote/youcannotofferyourvaluedcustomersanybette

http://www.quotesea.com/quotes/by/john-garwood

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Sales promotions have 3 distinct characteristics –

(a) Communication – They gain attention & usually provide information that may

lead the consumer to the product.

(b) Incentive – They give certain concession, inducement or contribution that

gives value to the consumer.

(c) Invitation – They invite a distinct invitation to engage in the tree.

Nature of sales promotion:-

1. Irregular / non recurring activity- Sales promotion is an irregular & non recurring

activity to increase the sales & this technique is used for specific situations only

such as decline in demand, fall in profit, acute competition in the market or during

the introduction of new product in the market.

2. Target- The target for producer‟s sales promotion may be middleman, end users,

household or business users or the producer‟s own sales force. Middleman sales

promotion at their sales people or prospects further down the channel of

distribution.

3. Motivation & extra incentive- Sales promotion involves some type of incentives

that offer a reason to buy. This incentive is usually the key element in a

promotional program & is an effort by which consumers, traders and sales force

are motivated towards maximum sales.

4. Acceleration tool- sales promotion is designed to speed up the selling process &

maximize sales volume.

5. Immediate impact- Sales promotion can be implemented quickly & gets sales

results sooner than advertising sales promotions offers an incentive to buy now.

6. Objective- The objective of sales promotion is to establish a link & coordination

between the activities like advertising, personal selling, publicity etc. sales

promotion bridges a gap between advertising and personal selling.

7. Non media activity- Sales promotion is referred to as a non media activity as sales

promotion is differentiated from advertising & publicity & also includes them as

part of the overall promotions mix.

8. Strategic role- Because of the immediate nature of the impact, sales promotion

have been thought of as merely this view is changing and the strategic role of

sales promotion and their integral role in the promotional mix are being

recognized.

9. Planned activity- The fact that sales promotion can be effective throughout the life

of a brand shows their strategic role. Sales promotion activities should be planned

well to stimulate sale.

10. Versatile- Sales promotion is extremely versatile. The different forms of sales

promotion are capable of being used with various groups & designed to achieve

different effects. Sales promotion can be useful throughout the product life cycle.


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11. Means of marketing communication- It is an important means of communication

by which views & ideas of consumers about the products & services are

exchanged with the producers regularly.

12. An element of promotion mix- Sales promotion is one of the important elements

of promotion mix, other than advertising, personal selling and publicity.

13. Universal activity- It is a universal activity adopted by all the economies of the

world in their sales efforts.

Role of sales promotion:-

1. To popularize goods and services of the producer among the potential consumers

& to motivate them towards larger purchases.

2. To motivate the existing customers for maximum purchase.

3. To maintain the sales up to normal level even during seasonal vacations & during

the declining stage of PLC.

4. To increase goodwill of the firm.

5. To educate customers/dealers & salesmen about the techniques of sales

promotion.

6. To simplify the efforts of sales force & motivate them for larger purchase.

7. To stimulate maximum sales on special occasions such as Diwali, religious

festivals & other such occasions.

8. To search for a new market & to introduce new products in to the market.

9. To counteract competition.

10. To facilitate coordination & proper link between advertising and personal selling.

11. To promote larger sales in certain specified segments of market.

12. To present a counter promotional program against the competitors.

13. To develop patronage habits among customers.

14. To prove the product better in quality & users.

Importance of sales promotion:-

Sales promotion is an important component of the marketing program . It can be a

specific tool of the promotion. Quality sales promotion provides advantages to the

various groups described below:-

1. Importance to consumers

2. Importance to producers.

3. Importance to middlemen.

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4. Importance to society & nation.

1. Importance to consumers:-

(i) Availability of new products- It is easy to sell new products

with the help of sales promotional tools. Hence the

producers are encouraged to bring new products.

(ii) Various rebates & free discounts- Sales promotions offers

various incentives like rebates & free discounts, free

samples which helps to stimulates sales & purchase.

(iii) Thrill in life- The various incentives contents samples,

demonstrations, fair and exhibitions create thrill and joy in

consumer‟s life and the relish these beneficial offers.

(iv) Low price- Sales promotion increases sales volume and

reduce the unit cost of production & thus the prices reduce

& it benefits consumers.

(v) Increase knowledge- Sales promotion increases the

knowledge of the consumers with regard to the uses,

operation & maintenance of the product.

(vi) Provides higher standard of living.

(vii) Buying confidence- Sales promotion tools provide the

consumers an opportunity to understand the product. This

creates a buying confidence among consumers. They may

take better buying decisions which ultimately increases their

satisfaction level.

(viii) Minimize exploitation - The promotional plan creates a

better knowledge about the products, their uses & quality.

As a result, the seller can‟t exploit the consumers.

2. Importance to producers:-

(i) Increase in sales- Sales promotion attract consumers &

stimulate them to make larger purchaser.


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(ii) Improve effectiveness of Media Activities- the sales

promotions plans make the advertisement & other media

activities more effective to achieve the sales largest these

give pulling power to ads.

(iii) Help personal selling- sales promotions supports personal

selling process the salespersons can use demonstrations ,

distributions to free samples , contest methods to push the

sales. Sales promotion aimed at company‟s own sales force

might motivate salesmen to get new costumers, selling a

product.

(iv) Able to capture new market.

(v) Increase regular sales & seasonal products.

(vi) It helps in increasing goodwill of the firm.

(vii) The various promotional incentives offered to the dealers

help to achieve cooperation from them to sale the products

& to maintain maximum stock with them.

(viii) It is an effective step to face the competition.

(ix) It helps in increasing the demand of new products.

(x) It helps in maintaining existing customers.

(xi) It creates a trusting attitude among customers. Free sample

& functional demonstrations creates a faith in the use of

merchandise which results in longer sales.

Importance to middlemen / dealers:-

(i) Facilitates longer sale.

(ii) By operating various sales promotional plans, manufacturers

provide various type of helps such as rebates, trade

discounts, gifts, rewards to dealers & resellers.

(iii) A direct relationship between the dealers & the customers

are established through the sales promotion techniques

which will continue for a long term.

(iv) As the cost of each deal is reduced the profits of dealers are

also increased.

Q.2 What are the functions performed by a sales promotion department?

Ans. The success of modern business largely depends on the functions of sales

promotion department. Sales promotion department becomes more important as

there exist a buyers‟ market in place of a seller‟s market.

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The functions & responsibilities of sales promotions department have been

described by Alfered Ghoss & Haughten in 3 ways:

1. To establish coordination with other departments.

2. Assisting functions towards dealers.

3. To motivate the customers.

Usually the sales promotions department undertakes the following fu

Planning for sales promotion company-The primary function of the sales promotions

department is to make long term & short term planning for undertaking promotional

programs. This is done by evaluating the various factors such as market condition , level

of competition , demand & supply situation , advertising , personal selling , etc.

1. Assistance to top executives- The sales promotions department provides various

information to top executives & give assistance in related matters for decision

making.

2. Coordination & liaison with other departments- The sales promotion department

regularly coordinates with other departments such as advertising, sales force

management, packaging, publicity etc. The value promotion is coordinated in view of

the travelling schedule of salesmen, sales presentation etc. Sales promotion

department is also associated with production, finance, traning departments of the

organization & established coordination with these departments from time to time.

3. Sales promotion research- In order to make sales promotion program more effective

, the S.P. department undertakes surveys & evaluates the information gathered to

know about the changing values, traditions, culture , consumers behavior & public

opinions.

4. Execution of sales promotion program -The sales promotion department also

execute programs design for consumers, dealers & the various advertising &

promotional agencies, PR officers, distributers & exchange ideas with them. It

organizes sales exhibitions, trade fairs, contests etc, from time to time.

5. Provides training to the sales lesson -The sales promotion department trains the

salesmen about the company , its products , promotional incentives being gives to

buyers. The department also gives introduction about company‟s policies & plans.

Customers-salesmen relationship.

6. Evaluation of sales promotion - sales promotion department evaluates the planned

promotional program & with the help of these promotional plans, data are collected &

it is analyzed to find out the effectiveness of the program. Consumes survey,

consumer panels gives a clear picture of the various sales promotional tools.

7. Assisting dealers / middlemen to make advertising more effective-dealers also

deal with advertising of the various products. The sales promotion department helps

in producing training to the salesmen , to promote dealer interests etc. The sales


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promotion department also decides on with best advertising messages, copies &

media for their products.

8. Coordination between advertising & personal selling.

Q.3 what is distinction with advertising & personal selling?

OR

Discuss the points which make sales promotion distance with that of

Advertising & personal selling.

Ans. Sales promotion can be differentiated from advertising in the following ways:-

1. Non media activity:- Sales promotions a non-media or below the line

activity & advertising is the media related activity.

2. Limited time period:-Advertising is for long term effect & is for longer

periods, whereas sales promotion is for a limited time period only.

3. Easy evaluation:-The impact of sales promotion can be easily measured

in comparison to advertising.

4. Faces on immediate purchase:- Advertising is designed to have

awareness , interest & preference building effects over a long run. Sales

promotion simulates quick & immediate purchase or sales promotion

offers a reason to buy now.

5. Creating action:-Advertisement builds long term brand awareness &

sales promotion is used for creating action.

Distinction of sales promotion & personal selling.

1. Role:- Sales promotion helps to increase the effectiveness of personal

selling & personal selling creates desire for a product thereby effecting

sales .

2. Motivation:-Sales promotion provides physical motivation to customers

personal selling provides physical and emotional motivation to customers

3. Personal presence:-Personal presence of salesmen is not necessary in

sales promotion whereas in personal selling salesmen is required for

selling.

4. Media:-Sales promotion can be presented through any media like vocal,

written or audio visual personal selling it can be presented through vocal

media only.

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5. Compumentary function:- Sales promotion is complimentary to personal

selling whereas personal selling does not complement to the sales

promotion program.

6. Continuity:- Sales promotion is not used as a securing activity whereas

personal selling is a routure activity which regularly operates.

7. Orientation:- Sales promotion is oriented largely towards the firms or its

product , personal selling in customer oriented.

8. Object:-The objective of sales promotion is to feel a gap between

advertising & personal selling & the objective of personal selling is to

solve the problems of customers & to get more sales

Q.4 What are the roles of sales promotion in a company or shortages?

Ans. There are three types of world economy:- developed, developing & under

developed (Shortage economy) . In an economy of shortages, the availability of

goods & resources are shorter or lesser than their demands.

Limitations of a shortage economy-

1. Under developed in economic aspects.

2. Natural resources remain untapped.

3. Restricted development of industrial activities.

4. Lower standard of living of people .

5. Shorter supply of product & resources.

6. Slow growth of capital formation.

7. Limited opportunity for employment.

Economists say that development of economy is possible only when there is

increased sale. Therefore sales promotion is considered to be tool for stimulating

the sales.

Also, in a shortage economy, seller‟s market is dominant whereby seller takes the

advantage of the situation & creates situations of unfair trade practice. Thus, sales

promotion can stop this situation of unfair trade practice & thus the economy will

grow through the production of new items copy setting products of new industries

& industrial units & this way the wheel of economy development might move

faster & can create a surplus situation in an economy of shortage.

Q.5 What are the commonly used tools & techniques of dealer

Promotions?

OR

What are the different sales promotional tools useful for traders?

Ans. These promotional tools are targeted to marketing intermediaries such as

wholesalers, retailers, distributers or agents who stock the manufactures products

for sale sales promotion directed at the trade helps push a product into the

distribution channel until it reaches customers.


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Here are the most common types of trade promotion tools:-

1) Point of purchase displays:- A manufacturer designed display distributed

to retailers who use it to draw the customers attention to product

promotions is called as pop displays. Pop includes passion racks, display

cartoons, banners, signs, price cards, mechanical product, dispenses etc.

2) Incentives: - Incentives to members of trade include awards in the form of

travel, cash bonus, gifts etc. another form of trade incentive is referred to

as push money. Push money is carried out through a program in which

retail sales people are offered a monetary reward for featuring a marketers

brand with shoppers.

3) Trade allowance:- Trade allowance is probably a discount or deal offered

to retailers or whole sales, to eucauage then to stock display the

manufacturers product Types of allowances offered-

(i) Advertising allowance:- In this method, actual expenses or certain

percentage to purchases made, are not met by the producer. Instead an

allowance is paid to the dealer toward advertising expenses.

(ii) Promotional allowance:- Certain items which helps in advertising and

publicity are distributed to retailers free of cost. Such novelties include

pens, calendars, paper weights, bill books, bags, diaries, memo pads

etc.

(iii)Display allowance:- The producers who don‟t provide display material

to dealers, provide them with display allowances.

(iv) Buying allowance/Price off allowance:- The price of allowance is

given on purchase made during a specified period of time directly from

the producer. This encourage larger purchase from the producer.

(v) Brand deal allowance:- Such allowances are given to those

middlemen who deal exclusively with a single brand.

(vi) Buy back allowance:- It is a sum of money given to the reseller for

each unit brought after an initial deal is over.

4) Sales training program:- Another form of dealer promotional tool is

sales training program. Salesmen at the retail level need to be trained

about the features of the product, benefits, advantages of different

models/brands etc. cosmetics, appliances, computers, electronic products

are examples for which consumer rely on trained sales staff.

5) Trade shows:- Trade shows are certain activities designed where

manufacturer can display their products to current as well as prospective

buyers. They are attended by retailers to distributers and involve

demonstrating products, identifying prospectus and gathering customers.

Trade shows are particularly valuable when a new product is introducing

in to the market many companies use trade shows to entertain key

customers and to develop and maintain relationship with them

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6) Cooperative advertising:- In this method the dealer and the producer

both jointly share the expenses of advertising. Either the producer may

bear a fix amount of the advertising expenses or certain percentage to the

purchase made by the dealer in a year.

7) Free merchandise:- Free merchandise is sometimes offered to resellers

who purchase stated quantities of the same or different products.

8) Sales contests:- Sales contests are organized for dealers also on the basis

of highest sales achieved by dealers during a specific time period. Prizes,

certificates are issued to such dealers and such contest hence motivates the

dealer for longer purchases.

9) Retailer kits:- Materials that support retailers selling efforts are retailer

kits. The kits contain supporting information such as detailed product

specification, ad slicks- print ads that are ready to be sent to the local print

media.

10) Advertising and display aids:- Some of the aid are –

(i) Local news paper advertising:- Advertisements in local news paper

specifying name, contact no. and address of dealers, helps the people to

know about the dealers in town.

(ii) Direct mail advertising:- In this the producer sends various

advertising and publicity material to dealer by mail. This includes reply

cards, calendars, diaries, folders, house magazines, order book, hand

bills etc.

(iii)Outdoor advertising:- Producers provide banners, sign boards,

posters, bill boards, holdings to dealers at their own cost.

(iv) Organizing fashion shows:- Some companies organize fashion shows

in big cities to promote their products. This is also an encouragement to

dealers.

11) Sales assistance:- (i) Building up sales plan:- Producers extend help and express

knowledge to wholesalers and retailers in building up sales plan,

formulating strategies and sales programs. This help the dealers

to increase their selling skills.

(ii) Sales meetings:- Producers organize sales meeting for distributers

to provide knowledge about new products, sales policies and

sales plan.

(iii) Buy back guarantee:- Producers sometimes gives buy back

guarantee to dealers for the goods that have not been sold by

them. Thus goods are sold to dealers on sell or return condition.


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(iv) Special trade terms:- Middlemen/Dealers are encouraged by

special trade terms which may be related to price, payment,

credit, allowance, financial assistance balance of stock etc.

(v) Special services:- Producers also offer special services to dealers

which include packaging, categorization of products, dealer

listing.

(vi) Credit facilities:- Producers provide short term credit facility to

dealers to motivate them to have maximum stock of the goods.

12) Management assistance:- It includes –

(i) Providing knowledge about management techniques.

(ii) Advice towards policy matters.

(iii)Guidance in setting up internal organization.

(iv) Sales management process.

Q.6 What are the different tools of sales promotion for consumer promotion?

Ans. This sales promotion is aimed at final consumer or users. Consumer sales

promotion used by retailers are aimed at attracting customers to specific

locations. The consumer promotion tools are-

1) Sample-Samples are offer of a trial amount of a product generally 84%

consumer package goods marketers use sampling as part of their promotion

strategy. by offering free samples , a company gains entry into that market ,

soaps , detergents , toothpastes, shampoos, conditioners are examples of few

products that are normally popularized through free samples. Free samples are

distributed for several reasons: To stimulate tral of a product to increase sales

volume in the early stages of PLC, to obtain desirable distribution. The

samples can be distributed through in store sampling (food products and

cosmetics), door to door sampling, mail sampling, (through postal service),

news paper sampling, mobile sampling, on package sampling, professional

sampling(drugs).

2) Premiums:- Premiums are goods offered either free or at low cost or an

incentive to buy the product. Premiums are offered as bonus, prize, gifts or

other free offers. Premium can be used to boost sales to attract competitor‟s

customers, introduces different products.

E.g. :- Aquafresh toothpaste- At the launching of Aquafresh toothpaste

offered two tubes at the price of one.

Colgate offered 125gm. tube for the price of 100 gm.

Santro- book year santro today & take home a worldspace Hitachi digital

radio receiver worth Rs. 4990/- free.

Pepe- Buy products worth Rs. 4000/- & get a bag worth Rs. 888/- free.

Adidas- Buy product worth Rs. 2800/- and get a Adidas bag free.

3) Contests:- Contests of various kinds constitute widely used sales promotion

tools. There are consumer contest which are open for all, consumer contest are

given wide publicity to attract the participation of the widely scattered

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consumer base. consumer contest take a variety of forms- Quiz contests,

beauty contest, car rallies, scooter rallies, suggesting a logo etc. Contests can

be divided in to 2 broad categories- Skill competition & sweepstakes. One

form of sweepstakes is a game & scratch off cards with instant winners &

prizes are an important promotional tool. E.g. :

(i) Nescafe shake contest – Nescafe shake contest offered Rs. 5 lacks as total

prize money with Rs. 1 lack for the first prize. The total number of prizes

ran to 21000. The contest had a specific objective to make consumers

aware of Nescafe as a cool summer drunk in addition to this traditional

image of a hot beverage.

(ii) Cadbury‟s family contest- Cadbury announced fabulous prizes- round the

world, economy class are ticket for two adults & two children plus Rs. 1

lack in prize money. The participant has to submit a minimum no. of

cadbury‟s wrappers & coin a jingle to participate in the contest. The

campaign helped to increase the sales.

(iii)Lakme – Create your own shade contest – Lakme lever held the to elle

18, Create your own shade contest for the target audience of elle 18

range of colors cosmetics & fragnances. The participants were required to

create own shades. The winner created a sparkling blue shade & later

Lakme launched the new shade in the market.

(iv) Pepsi contest for children – Pepsi ran a contest among children to

promote its potato chips brand ruffles. Nearly 500 children from a school

were collected 30 of them were picked to speak for a minute the winners

were given ruffles. Pepsi had covered 250 schools and 125000 students

across the country spending Rs. 2 lacks only.

4) Demonstration:- Companies resort to product demonstration for sales

promotion especially when they are coming up. With a product new to the

market. In India products like beverages, washing powders, electronic product

have utilized product demonstration as a tool of sales promotion. it may be-

(i) Demonstration at retail store.

(ii) School demonstration.

(iii)Door to door demonstration.

(iv) Demonstrations to key people.

5) Coupons:- Coupons are certificates which offer reductions to consumers for

specified items. Coupons distributed through newspaper, magazine

advertisement or by direct mail. Coupons enchoose the customer to exploit the

bargain and they also serve as an inducement to the trade for stocking the

items.

Types of coupons- (i) Instant redemption coupon- Consumers can immediately redeem the

coupon.

(ii) Bonus back coupon- Coupons can be placed inside packages so that

customer can‟t redeem them quickly.


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(iii)Scanner delivered coupon- Firm can issue coupons at the cash register.

These are triggered by an item being scanned.

(iv) Cross ruffling- It is the placement of a coupon for one product on another

product. E.g. a coupon for an onion sauce placed on a package of potato

chips is a cross scuffling coupon.

(v) Free standing inserts coupons can be delivered to consumers through news

paper.

(vi) In store couponing- Coupons are distributed in a retail environment.

6) Trade fairs and exhibitions They form one of the oldest practices of sales

promotion. Trade fair & exhibition provide companies with the opportunity

for introducing and displaying their products. This brings the company‟s

product and the consumers direct contact with each other. Trade fairs have

become a handy and effective tool of sales promotion. Orders and enquiries

worth billions get generated at international trade fairs.

7) Discounts and price of E.g. 20% off on levis

10% on Tanishq

8) Free gifts/Gift cards- Companies also give gifts to consumers, dealers and key

people. These gifts include pens, diaries, table, decoration. Gifts normally

carry the company‟s name and logo. The gifts are intended to create goodwill

towards the company.

9) Exchange schemes/Money back offers- This is the latest sales promotion tool

in consumer disables market. E.g. Akai exchange scheme- Bring in your old

color TV with remote.

Videocon money back offer.

Philips- 5 in 1 offer.- Philips TV, 2 in 1, Mixer, grinder, rice cooker at an

attractive price.

Sponsoring the games and teams- Many companies like reliance, Pepsi,

Pentaloons, Maruti sponsor different games and sports in the country and

abroad.

Q.7 What are the tools of sales promotion used for business and industrial goals?

Ans. Sales promotion is targeted for business and industrial goods also Industrial

products differ with that of consumer goods. The tools which are used are-

1) Trade shows:- The industrial products are displayed and demonstrated to the

members of trade and industry. The representatives explain about the products.

The trade shows can be useful for smaller firms which can‟t much in

advertising and also salesman can make for more contacts. Trade shows are

important rules for reaching potential wholesalers & distributers for a

company‟s brand.

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2) Business gifts:- These gifts are given as a part of building and maintaining a

close working relationship with suppliers business gifts may include small

items of jewellary, watch, electronic items, expensive trips.

3) Trial offers:- Trial offers are particularly well suited to the business and

industrial market. Trial offers provide a way for buyers to lower the risks of

making a commitment to one brand over another. Trial offer is a good way to

attract new customers who need a reason to try something new.

4) Frequency program:- high degree of travel associated with many business

professionals make frequency programs and an ideal form of sales promotion

for the business and industrial markets. This can be used in airline, hotel and

other industries.

5) Coupons:- Coupons are used in business to business sector. Coupons must

reach the hands of a purchasing against or someone who has the authority to

make decision.

6) Contest and sweepstakes:- As like in consumer promotional methods.

Customer methods. Business buyers are also interested in winning prizes as are

customers in other situations.

7) Sampling:-- Sampling is an excellent method to encourage a business to buy a

product. E.g. producing a sample in the area of process materials has the

advantage of giving the engineers an opportunity to analyze the materials to

see if it meets their standards. Through analysis they may find that the material

is actually superior to the product they currently use.

8) Bonus picks:- offering a prospective a bonus pack may attract new users as

price is a negotiated item in our B2B sector price of discount can be offered by

vendors seeking to obtain a new business contract.

9) Other tools:- They may include demonstrations, free training, warranties,

credit faculties maintenance services, films, publicities and audio visual aids.

Q.8 Discuss the promotional tools aimed at internal organization?

Ans. Promotional of internal organization concern with the steps to be taken for a

sound promotional programs. The elements of internal promotion are as follows-

1) Approval of promotional philosophy:- The success of a promotional program

depends on the attitude of the top management. There for a promotional program

requires the approval of the top management. The manager has to make a cost

profit analyses so that top management appraise him about the profitability of

program.

2) Product department for marketing:- Quality of a product is responsible for the

success of sales promotion program. As the customers are quality conscious and

he always makes a comparison with that of competitors product before taking the


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final decision of purchase. Therefore the product manager should continuously

work on improving the features of the product.

3) Coordination with advertising department:-It is the advertising department that

make the ground for the sales by giving product knowledge among the distributers

as well as potential customers. When the frequency of the advertisement is

reduced then the sales promotion‟s frequency start increasing. Therefore a

coordination has to be made with the advertising department.

4) Coordination with sales department:- Sales promotion program can be

successful if a proper exhibition is established with the sales department. Its

includes arranging and organizing sales meetings and conferences, organizing

contest, sales exhibition, traveling to sales personal etc.

Q.8 Discuss in details the export- sales promotion.

Ans. Export sales promotion is the special selling efforts, motivations and aids which

are designed to serve the foreign customers and dealers to stimulate and maintain

sales in the foreign market. Export sales promotion for a foreign market follows

push and pull strategies. In push strategy the sales wrap recentlves and distributers

are stimulated for large sales and in pull strategy the buyers of goods and

customers are stimulated directly by the various customers promotional

techniques.

Objectives of export sales promotion:-

1) To stimulate larger sale in foreign market.

2) To enter in to the foreign market with a new product.

3) To attract the customers at retail level and develop the foreign market.

4) To compensate the loss of one market by earning from the other.

5) To undertake market research.

6) To establish coordination between personal selling and advertising.

7) To test the product in over sales market.

8) To expand a PLC.

9) To establish an image in the mind of target market.

Types of export sales promotion:-

The various methods used for export sales promotion are –

1) Classification on the basis of functions to be performed & target to be reached.

(i) Introducing a new product-New product can be promoted in the foreign

market with promotional tools such as free samples, refunds, fairs &

exhibitions etc.

(ii) Increasing the use of product-Tools like price off deals, distribution of

premiums, contests are used in business market.

(iii)Direct enticement of customers at retail level-Export promotional

plans can be operated with the help of retailers tools like trading

stamps , retailer coupons , point of purchase , free training etc. are

used.

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2) Classification on the basis of target audience.

(i) Customers oriented tools-Free gifts , samples , premiums , offers ,

contests, refund offers , fairs & exhibitions , stage shows , pop displays ,

coupons & trading stamps patronage rewards & special sales techniques

are used in the overseas market.

(ii) Distributions oriented tools-Sales contests dealers sales training , pop

displays , money & merchandise , allowances , advertising aids &

cooperative advertising , managerial assistant in accounting & inventory ,

formation of sales strategies are the tools for distributor promotion

analysis of international market information , foreign trading materials etc.

can also be need.

(iii)Foreign market centered sales men techniques-The important sales

promotional tools for foreign salesmen are-Sales meeting , sales men,

contests costumers product models, samples & visual aids , sales literature

& sales training manuals, briefs of foreign trade low is foreign marketing

& sales portfolios foreign market research information.

3) Factors affecting export sales promotions-domestic marketing is different from

international market. there are differences in consumer behavior , consumer tastes

and preferences, consumption habits , business traditions, cultural values etc.

Certain factors which effect the sales promotions in foreign market are-

(i) Govt. interference-In some countries, the govt. may impose restridions on

the use of certain kinds of sales promotion techniques used by organizations.

(ii) National opinion- The opinions may differ from country to country. And in

European countries, door to door selling of cosmetic is considered as

interference with personal affairs.

(iii) Problem of translation- languages used in sales promotion might pose

problems in the sales promotion program.

(iv) Statuary condition- Statuary conditions in many foreign countries inculcate

certain changes or modification in the promotional techniques.

(v) Marketing environment – Consumer needs preferences, interests, livings,

conditions buying & consumption habits shopping habits , necessitates

suitable improvements in the sales promotions techniques.

(vi) Political views- Political conditions outlook of political leaders exercise

control over the promotional techniques upto certain limit in foreign markets.

(vii) Structure & behavior of wholesaler & retail traders- Certain sales

promotions tools are executed by the cooperation of wholesalers & retail

traders & there for the structure & behavior of wholesales & retailers have to

be kept in mind as the functioning & practices of these traders may be

different in foreign markets.

(viii) Consumption patterns-Consumption pattern in different countries may

differ therefore sales promotions techniques should be used keeping in view

the foreign market.


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(ix) Cultural values & traditions- Sales promotions techniques should be

culturally accepted by the people in the foreign market. As the culture of

different countries differ.

Q.9 What are the needs for evaluation of sales promotion program? Discuss the

methods of evaluations of sales promotion program.

OR

Discuss the needs for evaluations of sales promotion program.

OR

Why the need arises for evaluations of sales promotion program? Explain.

Ans.- Though almost all companies resort to sales promotion techniques , only some of

them follow it in a planned way. The conditions for the success of sales

promotion program are as follows:-

1. Identify the requirement – The firm needs to find out. It is to bring in

substantiate extra sales immediately. It is to offered accumulated stocks ? It is to

regain loosing consumer interest in the product etc.

2. Identifying the right promotion program-The firm has to select the program

suitable for current need & situation the choice of the firm should be deducted

according to the resources available with the firm.

3. Enlisting the involvement of salesmen- Often sales promotion program are

conceded & planned at the head office . But for the campaigns to succeed, it is

essential that the salesmen be briefed on the contest & contest of the program.

They have to be informed of their roles in the conduct of the program.

4. Enlisting the support of the dealers:- It is also essential to enlist then support of

the dealers in any large scale sales promotion venture. Since the major part of the

activity is around the dealer shop, the pop material and the product under

campaign will get the required prominence. Only if the leader so dealers.

5. Enlisting the advertisement agency’s support:- The adevertising agencies

support is also essential for the successful working of a sales promotion

campaign. carrying out a sales promotion campaign is as challenging as

conditioning an advertising campaign. So companies while commetting heavy

finds for sales promotion make it a point ensure that that they benefit from the

experience and experlise of their agency.

6. Timing of the campaign:- The sales need of the company is the prime factor that

desides the timing. But the firm has to eansider factors like seasonality of

purchase of product.

Need for evolution:- The need for evaluating the sales promotion programs are-

1. Identifying growth and development opportunity.

2. Taking correction steps in case of any draw back.

3. To measure the effectiveness and achievements of objectives.

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4. Facilities for future planning.

5. To encourage for research & innovations.

6. To motivate the employees into have contributor.

7. to know the maturity limit of sales promotion program.

8. To study new & modern tools of promotion.

9. To get allocated maximum budget for sales promotion.

Methods of evalution:-

1. Sales data method- This method is a widely a accepted practice. In this method ,

sales volume or market share prior to any sales promotion techniques are

measured . Eg. If market share of a product before the introduction of sales

promotion is 4% , during the period 10% & immediately after the program 6% ,

Thus giving an increase of 8%. Showes that new customers are created by the

sales promotion program.

2. Consumer panel data- This technique help to identify that how the customers

have been motivated by the sales promotion technique for longer purchase . How

much quality have the customers purchased & What were the charges of their

buying behavior after the sales promotion program. This technique help to

identify the various classes of customers on new or old customers / women / men

/ industrial / general customers etc.

3. Consumer surveys- This method collects various kinds of information about the

customers so as to analysis the effectiveness of sales promotion. The analysis of

suchinformation help to know following things-

1) The numbers of customers who have remembered the techniques used.

2) The views opinion about these techniques.

3) How these technique have been helpful in influencing the buyer‟s

behavior & brand chore of customer?

4) Do the customer require any innovation to be differed in the product?

5) Do these techniques improve the image of the firm?

6) Do they feel like using these techniques through the year?

4. Experiment methods- The effectiveness of sales promotion technique may be

measured by experimenting them in selected markets. However there can be

certain difficulties. They are as follows-

1) The consumer always looks for deals customers are interested only in the

purchase in the items which offer certain additional incentive with that of

the product.

2) The promotional tools at times can be very costly as, if the organization

does not get expected results. Then the price of product may be increased.

3) The cooperation from middlemen might not be smooth.


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MULTIPLE CHOICE QUESTIONS:-

1 Which of the following is a characteristic of sales promotion? 1.incentive 2.communication 3.invitation 4.all of the above 2 Sales promotion is a _--------- activity? 1.non recurrring and non media actvity 2.planned activity 3.universal activity 4.all of the above 3 Advertising presents an emotional appeal whereas sales promotion

presents an -----------appeal:- 1.intelligent 2.co operative 3.rational 4.none of the above 4 Functions of sales promotion department are:-

1. Assistance to top executives- 2.Coordination & liaison with other departments 3.Sales promotion research 4.All of the above

5 Trade shows,free trial offers ,free samples etc are types of:-

1.adveretising tools 2.personal selling 3.sales promotion 4.none of the above

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“CASE STUDY”

Client: LG Electronics Project: Product Launch Event: LG launches its new 71" plasma TV LG Electronics asked PGS Corporate to help turn its launch parties for a new big screen plasma television into memorable events for customers at two key retail locations. PGS Corporate rolled out the red carpet and delivered amazing events.

Project Overview

To generate excitement for the launch of LG's 71-inch plasma TV, PGS Corporate coordinated and executed two customer events at key dealerships in Paramus, NJ and Los Angeles, CA

These events were catered to meet every need of the customers in attendance including: * Valet parking * Red carpet entrance with velvet ropes * Themed decor including LG branded ice sculptures * First-class food and beverage * Podium, microphone and speakers to introduce the TV * Gift-wrapped martini sets for parting gifts

PGS Corporate Involvement in Program Execution

All event logistics including pre-event planning, on-site execution, post-event summary and wrap-up etc.

“CASE STUDY” (i) Pizza hub is a chain of family oriented restaurants with more than 320

locations in 21 states.pizza hub offers full table service and features daily buffets for breakfast, lunch and dinner.


25

(ii) Challenge Pizza hub wanted to increase traffic and sales for featured items, such as seafood dishes and the nightly buffet at the company’s 140 wholly-owned restaurants. Each restaurant has approximately 50 employees .waht sales promotion tools should be used by pizza hub to increase store traffic and increase sales:-explain in detail.

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Section - B

Recruitment, Selection & Motivation

Ability is what you're capable of doing. Motivation determines

what you do. Attitude determines how well you do it.

-raymond chandler

Q.1.What do you mean by recruitment of sales men? What are the sources through

which salesmen are recruited : Discuss the merest & demerits of each.

In context of selection procedure

Discuss this statement –―The fortune of a consumer depends on sales which

intern depends on salesmen.‖

Ans. Recruitment is the process of identifying key people in the organization & a process

to discover the source of manpower to meet the requirements of staffing schedule

& to employ effective measure for attracting the manpower in adequate numbers to

facilitate effective selection requirement is the first part of building a top notch

sales free.

Some of the definition of requirement are-

1. Edwin & Flippo – “Recruitment is the process of searching of prospector

employees & stimulating them to apply for jobs in the organization.”

2. Victor P. Bull- “Recruitment is the search for the best equitable candidate for a

sales position . ”

3. Byars & Rue- “Recruitment involves seeking & attracting a pool of people from

which qualified candidates for job vacancy can be chosen .”

4. Spiro & Stantion- “Recruitment includes identifying source of recruits that are

consistent with the type of person desired selecting the source to be used &

contacting the recruits.”

Process of Recruitment:-

The Process of Recruitment Involves:-

1) Establishing responsibility for Recruitment- The management must give

responsibility as to who will make the recruitment & the selection decision. this


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responsibility might be given to the top sales manager , the HR department or the

sales manager.

2) Determining sales force needs- The no. of new sales people depends on factors

such as sales growth targets, distributions strategies, sales force turn over. The

sales force turn over can be because of poor performance, retirement, resignation

for another job etc.

3) Considering company nature- A specific definition of the organization‟s culture

is necessary for planning cycle validity. The process of aligning a company‟s

recruiting strategies to its case culture should help attract and retain higher

programming sales people as complained to those companies whose recruitment

process are reactive.

4) Determination of the number of sales personnel required – The number of

salesmen is determined by keeping in view the following facts like- Present sales

activities of the firm, future prospectus for expression of sales, estimated sales by

each salesman, no. of present salesman to be promoted for higher posts, expected

no. of persons to leave the firm in the future, the usual turnover rate of the

salesman.

The formula used for calculating the no. of requirement of salesman is-

N= S/P (1+T)

Where

N= Number

S= Sales forecast

P= Present average sales

T= Turnover rate of sales personnel.

5) Developing a profile of the type salesman needed- The profile and nature of

salesmen is determined on the basis of the job requirements. Salesmen may be of

different nature and the nature of salesmen be determined on the basis of job

requirements. Two functions are mainly involved in determining the nature and

suitability of the salesmen-

(i) Job analysis – It refers to the process of studying the operations, duties

and organizational aspects of jobs in order to derive specification, for

analyzing the job being carried out by salesmen, following two activities

involved-

a) Job description- In this process first of all analysis of sales

activities are made and then job description is prepared. The

following points are usually covered like-

Title of job.

Organizational relationship.

Types of products & services sold.

Types of customers called on.

Duties and responsibilities related to the job.

Job demands.

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Hiring specifications.

b) Man specifications- It gives light on the employee needs. It

contains information on physical, features, health, voice, mental

qualities like education, mental balance, etc. social & moral

qualities like obedience , encouragement , friendship , sincerity ,

capacity to bear the heights & responsibilities , work experience

etc.

(ii) Review of the present salesmen- The existing salesmen are received to

as certain how many of them have been successful in their functions. As

a result of review, some changes may be interfused for them also.

6) Evaluating introduced recruitment- The company should continuously evaluate

the effectiveness of recruitment process. It will enable the management to

determine which sources produced the best results.

Source of recruitment – The source of recruitment can be categorized into-

1. Internal sources- a) Company sales personal.

b) Company executives.

c) Internal transfers.

2. External sources-

a) Unsolicited applications - All companies receive unsolicited walk in &

write in applications directly for sales job . The most logical policy is to

create volunteer applications the same as solicited applications.

b) Employment agencies.

c) Educational institutes.

d) Sales people making calls on the company.

e) Sales executives club.

f) Employees of customers.

g) Older persons.

h) Other industries .

i) The internet.

SELECTION PROCESS—

Selection is a process to determine whether an application meets the qualifications for the

specific job &to select the applicant who is most likely to perform well in job.

A proper selection of sales persons makes the base for success of a sales organization as

it increase per capita sales & the moral of the sales organization. A sound selection

process also increases the goodwill of the firm because the salesmen represent the

company. If he makes a poor impression , the company is likely to have a poor reputation

among its customers.

SELECTION PROCESS— The selection process consists of following steps-

1. Pre-interview screening- Pre-interview screening is done for the purpose of

elimination unqualified candidates , this pre interview can be handled by a clerk or


29

secretary. This pre interview screening is required as when there are large no. of

applications , it is desirable to rest out the prospective applications who have given

information about the nature of job , salary , responsibility etc.

2. Formal application form- Formal application serves as a record regarding the

information collected during the selection process. A formal application is filled up

after preliminary interviewer who records the responses of applicant.

3. Selection Tests-The selection tests are important part of the selection process.

Different types of selection tests are as follows-

a) Mental ability test- Mental test measure the overall intellectual

capacity of a person &enable the person to know whether he has

mental ability to deal with every new problem. The learning

capacity, Inductive reasoning, ability to take decision can be tested.

b) Aptitude tests- These tests are used to measure. The ability of an

application to learn new jobs or skills. these tests help to find out

whether a candidate will be appropriate for the job of salesmen or

not.. They focus attention on a particulars type of talent such as

learning & reasoning.

c) Achievement tests + Proficiency tests- These tests measure the

skill of knowledge which is acquired as a result of training

program & on the job experience . These lists can be helpful when

an experienced person is to be promoted to higher job or when a

person is to be transferred from one job to another.

d) Personality tests-These tests aim in measuring those

characteristics of an individual , which are non intellectual in

nature. They assess his motivation interests, his ability to adjust

himself to the stress & his capacity for inter personal relations &

self image.

e) Interest tests- These tests aim at finding out types of work in

which an applicant is interested. They are inventories of the likes

& dislikes of people in some occupation, hobbies etc.

f) Temperament tests- These tests help to evaluate the various

factors of temperament such as likes, dislikes, flexibility , habits

etc.

g) Attitude tests- These tests measure the attitude of applicants

towards business conditions, employment, salaries , promotions ,

labor , social & political charges govt. policies etc.

h) Situational tests- These tests measure the applicants capability to

work in the real situation , under this test, the capacity of the

salesmen to work in different sales areas & with different

customers is tested.

4. Interview- Interview is the most widely used selection step & helps in judging an

individual as to ability in oral communication, personal appearance, attitude toward

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sales & company etc It is a meeting between two persons sothal they can know about

each other.

a) Patterned or structured interview- Here the interviewer uses a

prepared outline of questions designed to get specific answer from

the interviewer. The interviewer may record the answer as they are

given.

b) Non directive or free interview- It is an unstructured interview.

In this type of interview, the applicant is encourage to speak about

his experiences freely. The interviewer might ask few questions &

speaks only enough to keep the interviewer speaking. Experts feel

that this technique is best for getting into individual‟s personality

in depth.

c) Stress interview- In stress interview, the interviewer assumes an

unfriendly behavior towards the applicant . He asks such questions

which can be quiet embarrassing for him & asks questions rapidly,

criticizes the answer & interrupts him frequently.

d) Rating sales- One draw back of a personal interview is the

tendency to lack objectivity a defect that can be reduced through

rating seales. sating are channeled into a limited choice of

response . experiences indicate that these results in more

comparable ratings of the same individual by different

interviewers.

5. Reference check- This check is made by personally contacting school, institutes,

present or previous employer on the basis of certificates, degrees, references provided

by the appointments. The purpose of reference checks to find out his character,

conduct, behavior & morality.

6. Physical examinations- Most of the companies go for physical examination &

following examinations can be carried like-

Examination of physical fitness, heights , weights , stomach , waist etc.

Test of blood pressure , blood & urine tests , Neuro-psychiatric lists,

Medical treatment history etc.

7. Determining terms of service- Terms of service are determined after the selection

process Terms of service include the matters related to salary, commission,

allowances, housing facility etc.

8. Appointment- The appointment letter contains the terms & conditions of

appointment with regard to pay , allowances , conditions of service probationary

period , the last date of joining duty etc. , duty signed by the appointing authority.

9. Induction / orientation- Induction gives the following information to the

salesmen –about history of firm, policies & rules of firm. information about sales

department , products & services , social welfare schemes, policies towards


31

promotions & transfers , disciplinary measure, rights , duties & responsibility of a

salesperson.

Q.2 Define sales training, state various methods of providing training to the

salesmen.

OR

Explain the various aspects of sales training.

OR

How will you plan and build a sales training program?

Ans. Sales training has been recognize as one of the vital factors in the success of the

sales person. The essence of training in the belief that performance of people

can be improved through the training.

Training of the sales men is a process of selling skills development so as to

increase the ability, knowledge and experience of the salesmen to perform well

on the job.

OR

“Sales training is an organized activity involving fact finding, planning,

coaching, placing and purposive attempt to develop selling skills and to add

these skills to selected nature ability, causally acquired knowledge and

experience.”

Aim of sales training/advantages:- 1) Increasing sales.

2) Getting new accounts.

3) Factor turn round of stocks.

4) Selling a complete product line instead of just fast selling items.

5) Better merchandising and sales promotion.

6) Better product knowledge.

7) Improving sales presentation and sharpening sales skills.

8) Improving clinching skill in particular.

9) Customer education on products, their use and benefits.

10) Improving customer and dealer relations.

Successful training program consist 4 phases:-

1) Training assessment- In this phase a messenger must discuss the following

points:-

a. Training objective-The major objective of training is to improve the

productivity of salesmen. Training programs also lower live employee

turnover rates, leads to better morale, more effective communication &

better self management.

b. Who should be trained- It is the newly recruited salesmen Who needs

training, but the existing sales force also needs training as things keep on

changing. New products are introduced , buyers performance charges , so

it becomes important to train dealers , distributers & sales manager.

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c. Training needs- Assessment of training needs provides the starting point

for getting training goals & designing the program. Setting the objectives

also helps to trainer & the trainee focus on the purpose of training as well

as provides the standard for measuring training effectiveness.

d. How much training is needed- the amount of training required depends

on the training objectives . for a new promotional program, only one day

training might be sufficient.

2) Training program design- In this phase , the following questions need to be

answered-

a. Who should do the training?- Regular line executives, staff personal ,

field specialist may serve as trainers. Any one of them or even a

combination of persons can be used.

b. When should the training take place?- Training should be continual

function as manager believes that every one placed in the field should be

fully trained, not only in company & product knowledge , but also in

selling techniques.

c. Where should the training take place?- The decisions of training

program‟s location involve the extent to which it should be centralized.

There can be 2 types of training-

i. Decentralized- It takes several forms like- field sales office, use of

senior salespeople, on the job training etc.

ii. Centralized- It may take place in organized or in period sales

meeting at a central location.

d. What should be the content of the training?- The basic topics on which

salesmen are gives training can be-

Knowledge about market.

Knowledge about customers.

Knowledge about products.

Knowledge about competitions.

Knowledge about company.

Salesmanship.

Team building skills.

Relationship building skills. \\

e. What training methods should be used?- Several different teaching

methods may be used to present material in a sales training program. It is

important to select those teaching methods that most effectively convey

the desire contest.

3) Reinforcement- Most sales people would not change their behavior as a result of

training unless there is same reinforcement. There can be many ways to reinforce

training.


33

4) Training evaluation- Sales manager must assess the effectiveness of the training.

This evaluation helps to determine the value of training & to improve the design

of the future programs.

Methods of sales training- The training methods can be categorized into-

1. Group training methods- a) Lectures / class room instructions- They are regarded as one of the most

simple ways of importance knowledge to the trainees, especially when

facts, attitudes, theories & problem solving abilities are to be taught. The

lecture method may be used for a group containing good number of

trainees, audio-visual equipments; VCR‟s, projectors also increase the

effectiveness of lectures.

b) Group discussion methods-In this method, different groups are formed

by limited numbers of persons. Each group seeks guidance under the

leadership of a senior officer. The group discusses the sales problems with

the leader & efforts are to be made to find out a commonly agreed solution

to each problem.

c) Sales conference methods- It is a formal meeting conducted in

accordance with an organized training plan. It lays emphasis on small

group discussion, on specific subject matter. Three types of conference.

such as 1)Directed conference 2)Problem solving conference 3)

Leadership discussions . This method is used for training the persons

holding managerial position.

d) Case study method- The trainees are given cases to analysis. They are

asked to identify any sales problem & to recommended tentative solution

for it. This method is useful for the manager to improve their decision

making skills.

e) Role playing method- In role playing, trainees act as given role as in a

stage play. Two or more trainees are assigned parts to play before the rest

of the members. The role players are informed of a situation & of the

respective roles they have to play. The idea of role playing involves

action, doing & practice.

f) Gaming methods- Gaming method is a technique which duplicates, as

nearly as possible & this method develops the decision making capacity

of the trainees. The knowledge about various decisions methods such as

selling efforts, advertising, sales force management, size of the orders time

for getting orders are learnt through such training.

2. Individual training methods- a) On the job training- The salesmen are appointed to do their duties under

the guidance of experienced salesmen. This method is also known as

training within industry.

b) Job rotation training- This method is used to provide knowledge to the

trainees in respect of functions of different departments such as research

department, accounts, advertising, packaging & public relations etc. This

type of training develops the practical knowledge of the trainees.

34

c) Personal discussions- The salesmen contact his sales managers & senior

manager from time to time & discuss with them the individual problems.

The manager gives good advice & suggestions on the basis of their

experience & their helps in improving the efficiency of salesmen.

d) Correspondence- When the sales trainee are at distant places, it becomes

difficult for them to assemble every time for training. In such cases,

training is imparted through correspondence. The training materials are

printed & circulated to the sales trainee at different places where they are

working . The trainees read the material carefully & learn to adopt or

fallow the guidance & instructions received through the study material.

Q.3 What do you understand by the term motivation? What is the need for

motivating sales personnel?

OR

Discuss steps in motivation process.

OR

Define motivation. Explain the different methods of motivating salesmen?

Ans. Motivation is a goal directed behavior and creating and maintaining a well

motivated sales force is a challenging tasks. Motivation is the amount of effort the

sales person desires to expand on each of the activities or tasks associated with the

sales job.

The desire to expand effort to fulfill a need is called motivation or motivation can

also be defined as an individuals willingness to exert to achieve the organization‟s

goals while satisfying individual needs.

OR

Motivation is an inner state that energizes, activates or moves channels behavior

towards goals.

Characteristic:-

1. Motivation is a .

2. It develops efforts and will to work.

3. It is a .

It is related with satisfaction

financial or non financial.

1. It provides rewards in line with the goal.

2. It is only one component of successful sales performance.

3. It is a psychological help given to salesmen.

Objectives of sales motivation:-

1. To stimulate the salesmen to reach and maintain satisfactory performance levels.

2. To improve the working efficiency of salesmen.

3. To establish cordial situation between the managers and salesmen.

4. To maintain high morale among the salesmen.

5. To satisfy the economic social, human needs of salesmen.

6. To implement sales management program.

7. To expand efforts of salesmen on each activity making of the sales job.


35

Need of motivation :-

The need of motivation arises because of following reasons.

1. Nature of sales job - The nature of sales job is for different from other jobs.

Salesmen have to put hard work to obtain a sales order as every sales job involves

ups & downs and feelings of joys and depressions. Salesmen also interact with

many unpleasant and rude people the connections cause sales persons to become

discowage to achieve low performance levels, So therefore additional motivation

is required.

2. Role conflicts - The sales person must try to satisfy the expectations of people

both within the company in customer‟s organizations. There is a linkage with four

groups a) Sales management b) Company or Organizations that handles order

fulfillment c) Customer d) Company sales person. Each group imposes

behavioral expectations and in playing these roles the sales person faces role

conflicts.

3. Domestic problems - Travelling salesmen mostly remain away from their homes

and due to these extensive travels, they cannot lead a family life. This leads to

demoavatoin among the employees and all these factors may influence adversely

in their proper functioning. They are given special leaves and monitory benefits

by certain companies to motivate them in this respect.

4. Development of team spirit – Most of the salesmen serving with big sales

organization work much away from the head office. they remain busy in the fields

at distance places throughout the year, So by organizing seminars and conferences

from time to time, such salesmen are given opportunity to meet at one place to

share group feelings and also for the betterment of the relationship.

5. Changes in market environment – Changes in market environment can be one of

the factors for motivation as what motivates salesmen today may not work for the

next month because of changes in market conditions.

6. Helps in building morale- motivation helps willingness to to work , when the

need of the salesmen are satisfied, he is stimulated to do more work , therefore

motivation is driving force for the development of morale.

7. Proper use of human resources- motivation is also essential for the effective use

of human resources as the inborn qualities of each salesmen can be developed

through better motivation tools so as to utilize the human resources for maximum

benefits of the organization .

8. To improve mutual relations- motivators encourage salesmen to improve their

work performance. This results in increased sale.

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9. Utilization skill- Most of the salesman do not make efforts to utilize their full

work capacity. Motivational tools stimulate them to expand their full energies &

to develop latent qualities.

Process of sales motivation:-

1. Determination of objective – A sales manager has to determine the reason & the

stage at which the salesmen has to be motivated. Objectives decide the levels

resources & tools of motivation.

2. Studying the unfulfilled needs – The motivational process starts with an assured

need. For this purpose, it is necessary to recognize the individual differences

between persons. The differences of mental conditions, expectations, positions,

aspiration, personal goals & their attitudes must be studied & hence the sales

manager should take step to study those unfulfilled needs.

3. Existence of motivation conditions- Three conditions must exist before an

unfulfilled needs lead to enhance sales performance . 1) Salesmen must feel that

the reward are desirable that is they will satisfy some needs . 2) They must believe

that the reward are tied to performance finally salespeople must believe that the

performance goals on which rewards are based are attunable.

4. Selecting motivation tools- The sales manager must design effective motivation

tools. Every motivational program should have some elements within it that can

be Toulouse to the individual needs.

5. communication – To make motivational plan successful it must be communicated

to salesmen and concerned person.

6. integration interests – The interest of salesmen and the firm must be integrated in

motivational program.

7. certain of auxiliary environment – physical environment and working conditions

play an important role in motivating sales personal. this environment may be

created within company by producing various ways and means for good working.

8. developing team spirit – individual efforts should be directed towards developing

team spirit among sales men.

9. feedback- the results achieved for the motivational plans should be compared with

the goals decided in the program in order to identify any deviation.

Q.4 What are the characteristics of a good sales compensation plan and discuss the

main steps involved in designing a sales plan?

Ans. To motivate the salesmen and for retaining the salesperson a good sales

compensation plan is the first requisite.

Basically a good sales compensation plan is that directs the salesmen activities

towards the objectives of the firm. It should stimulate the salesmen to put in their

best efforts both qualitatively and quantitatively towards achieving the plan sales

and other goals. It should assure a minimum income and appropriate additional

reward for above average performance. In many cases a good sales compensation


37

plan also helps ensure the right treatment of customers. A poor sales

compensation plan invariable Leads to poor quality of sales force.

A good compensation plan must :- 1. Direct salesmen activity towards companies objective .

2. Correlate efforts results and rewards of salesmen.

3. Help attract and keep competent salesmen.

4. Stimulate the salesmen in their best efforts.

5. Help control a salesmen activities.

6. enthuse efficient salesmen and help remove the inefficient once.

7. Preferably provide & components of income, an assured income and additional

reward for superior program.

8. Be fair and just to the firm and to the salesmen.

9. Reflect the current needs of the firm.

10. Be flexible and also stable.

11. Be simple and easy to administer.

12. Be economic and competitive.

Designing a sales competition plan :- The steps involved in designing a

sales compensation plan are as follows-

1. Describe the job.

2. consider the overall competition structure of firm.

3. Make industry compressions.

4. Select suggestions from sales force. (sales manager)

5. Aside the compensation level.

6. decide the compensation mix.

7. Financial compensation- a) Direct payment of money. b) Indirect

payment of money. Non financial compensation – a) Importunately for

advancement b) reorganization and fulfillment of esteem needs.

8. Decide the highlights of the different elements.

9. Put the plan in to operation, watch, review and improve.

The compensation level- In fixing the level of sales compensation plan

many firems go by the going market rate. Higher starts are given for more

competent and more experienced salesman who can bring in larger sales.

Detailed job description through job evaluation and intercompany as well

as inter compensations should be the basis for fixing the compensation

level. Compensation level offered to the sales men has to be suitable

related to the level provided to others in the field sales outfit like sale

supervisor and branch manager.

The compensation mix – Different firms follow different practices in the

regard. A few attractions are listed below.

1. Straight salary plan.

2. Straight commission plan.

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3. Salary plus commission combination plan.

4. Salary plus group commission plan.

5. Commission plus approved expenses plan

Straight salary plan:-

Merits-

1. Simple to design and easy to administer

2. provides a sense of security and basic motivation

3. help the firm control the salesmen better

4. Ensure salesmen attend to the long term marketing concerns of the firm

5. Help avoid unhealthy industry among salesmen

6. is particularly useful when the firm-

Has chosen the pull strategy for certain sales

has a set of fresh salesmen

goes in to fresh territories

Sells a technical product involving long negotiation and a long purchase

cycle

Sells in a market that is yet to be developed

Demerits- 1. it does not offer incentive for salesmen to increase sales.

2. salary is a fixed cost unrelated to sales volume or margin.

Straight commotion plan:-

Merits – 1. Provides incentive to perform better as it rewards the salesmen according to their

performance

2. commotion is a variable cost related to the sales volume or the margins brought by

the sales men

3. in particularly useful –

the firm has chosen a push strategy for creating sales.

high incentive is needed to get the sales.

Not must non selling work is involved .

the company is financially weak & has to relate its compensation

expenses directly to sales .

The market is highly competitive & sales are closely related to the sales

efforts.

Demerits-

a) Different to design & administer commission plans can become complex

involving complicated formula.

b) May not be of much use when the salesmen are absolutely new.

c) It is difficult to control straight commission people & is difficult to make

them perform tasks for which no commission is paid.

d) Difficult sales territories may suffer under such a plan

e) May result in excessive pushing of products without caring for the value

satisfaction to the customer.


39

f) similarly if the market becomes unduly depressed due to some reason, the

income of the salesmen would go down directly.


1 External sources of recruitment of a sales person are: 1. Company sales personal. 2. Company executives. 3. Internal transfers. 4. none of the above 2 Pre-interview screening,Formal application form,Selection Tests are

part of:- 1.selection process 2.recruitment process 3.termination process 4.none of the above

3 Motivation is a _______

1.phsycological concept 2.can be financial and non financial 3.goal oriented .all of the above 4 What are the characteristics of a good copmpensation plan?

1. Correlate efforts results and rewards of salesmen. 2. Help attract and keep competent salesmen. 3. Help control a salesmen activities. 4. All of the above

5 Straight salary plan.,Straight commission plan,Salary plus commission combination plan are types of;-

1.selection plan 2.recruitment plan 3.compensation plan 4.all of the above

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“CASE STUDY” A vacancy had arisen for a Director of Sales position and a local recruitment consultancy were given the task of finding a suitable candidate. Following discussions with the client, it was decided that useful additional information should be sought on candidates through the use of psychometric assessment.

The recruitment consultancy asked Team Insight to provide this assessment service on their behalf.

Timescales were short with the initial interviews having already taken place. Further complications included the difficulty in the short-listed candidate being available to complete questionnaires and undergo feedback sessions within the time available.what steps you would take to solve the problems while recruitment and selection process??


41

Section- C

Sales Forecasting, Quotas & Territories

“When it comes to understanding consumers it’s always

important to consider the issues from a rational

perspective”

-warren buffet

Q.1 What do you mean by prospective customers?

Discuss the steps involved in prospecting the salesman identify or locate the

prospecture customers.

Ans. Planned selling process is a process under which approach them and make an effort

to creat contests, desire, events among them. Selling process can also been defined

as an orderly progression that leads the prospect to make certain decisions, is the

frame work on which your sales presentation is build.

Steps in selling process:- Selling process involves the various stages –

1. presale preparation

2. prospecting or locating customers

3. Pre- Approach before interview

4. approaching

5. presentation of sales

6. sales calls and closing the sales

7. post sale/ follow up activities

Pre sale preparation:- In the pre sale preparation a salesmen prepare about certain

things like the product, knowledge about the firm, market information, knowledge

about sales techniques.

Prospecting customer:-

1. Defining the prospects- a prospective customer is in need for the product

have ability to pay and authority to buy the product & a good personality to

present the salesman for contacting him frequently.

2. Searching out potential accounts- the salesmen can use two types of sources

for selling potential customers. The secondary sources include friends and

relations of existing customers , self observation , field survey, by contrasting,

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advertisement, govt. and nom govt. agencies, magazines, social contacts. The

primary include family friends, relatives.

3. Qualifying products and determining probable requirements- it is

necessary to determine the probable requirement of customers and this

function may be performed on the basis of following indicators of need,

indicators of ability to pay , indicators of authority to pay, indicators of

accessibility.

4. Relating companies products to each customers requirement- The

salesmen on the basis of collected information tries to satisfy the specific

requirements of prospector customers

Pre approach:- Before approaching the customers there is anteed to cullet full

details about the customer. This approach involves collecting the details about the

potential customers such as age, sex , source of income, education, friends and

relation, present buying, buying object. The personality treats of customers are

also studied to get himself prepaid to face different types of customer.

Approaching:- In this stage the salesmen comes in contact with the potential

customers vat before approach salesmen should get an appointment fixed with the

customer.

Contacts with the customers without any period appointment is called as cold

calls. In such cold calls the salesmen should try to influence the customers by his

well manners.

Presentation of sales:- Presentation is the most important step in selling as in this

stage the salesmen presents his product to the prospective customer. The

presentation may be made by Type of customers while presenting the product,

the salesmen should follow the AIDA approach.

A- Attention – The presentation should be able to gain attention of the customer

towards the product or company.

I- Interest- The prospective customer should be interested in the product by the

company.

D- Desire- He should have a desire to buy a product.

A- Action- The customer takes an action in buying the product.

1. Attracting attention- Attracting the customer‟s attention is the first

step in presentation. There are certain factors which help in attracting

attention like showroom, lights, interest to customers, their

expectations and their personal problem.

2. Creating interest- Here an interest is created among the customers

toward the products. Interest can be created by benefit approach in

telling the customers about the benefits of a product or seriously

approach or aromatic approach or factual approach or “I am here to

help you “ approach or problem solving approach and service

approach or information and visualization approach.

3. Arising desire and building conviction- It is necessary to convert the

interests of the customers in to desires. Which is turn generally

demand for a product. The desire can be generated by making the


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customer clear how the product will satisfy the needs and making clear

the advantages the customers will receive using by the product.

The salesmen will be able to build coonvietion when the customer is

convinced from the talks, such a situation can be build only when the

salesmen can give the satisfactory answers, to the objections raised by

customer.

4. Handling/Meting objections- Objections are excuses for not buying

the product. objections block the sale that comes as the prospect either

does not understand the salesmen‟s propositions or does not agree with

him.

There are various causes for objection-

It is human nature to cause doubts when decision has to be

taken for buying new product

When the customer is unable to judge the advantage of the

product

When he fails to understand the personality and the language of

the salesmen

When he wants to testify the statement made by salesmen

when he disagree with the utility of the product

Sales calls and closing sales:- Whenever the customer‟s interest is created and the

customer is fully satisfied with the product then it is the time to close the sale. This is the

end point of selling process and during this time the customers is ready to place the

order.

Post sale activities and follow up:- The purpose of follow up is to evaluate the

complete selling process and to ensure everlasting relations with the customers.

The sale process does not end up immediately after orders, but has to continue even after

that.

Q. 2 Define sales forecasting? Discuss the produce & the methods of sales

forecasting.

Ans. Sales forecast is the basis of corporate planning forecasting is a systematic attempt

to product the future on the basis of known facts. It is the result of numerous

assumption made about the external and internal environment of firms.

Sales forecasting is the estimate level of the company sales based on chosen

marketing plan and assumed marketing environment.

OR

Sales forecasting is the climate of sales during some specific future period time &

under a pre determined marketing plan of the firm.

Important – 1. it is the foundation of planning.

2. Companies uses the sales forecast to allocate resource across different functional

areas.

3. It is the key factor in all operational planning throughout the company.

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4. It serves as a base for sales force planning.

5. It plays a major role in the success of the organization.

6. It is the key to sales management.

7. It helps in profitability of the firm

8. It helps in facilitating production planning

9. It helps in better financial planning.

10. It is developing sales strategies and promotional plans

11. It helps in suggesting R & D.

12. Also helps in better inventory control & sales quota determination.

Process of sales forecasting :-

Determination of goals – The sales manager should decide the goals for sales

forecasting. The objectives may include determination of sales publicity programme,

marketing methods , sales quota determination, estimation of working capital etc.

Determining the factors affecting sales – The controllable factors are like marketing

& advertising policy, organization structure etc. & the non controllable factors like

political & social systems, seasonal fluctuations etc. must be determined.

Selection of techniques – Suitable methods for sales forecasting must be selected

keeping in view the objective time intervals resources and nature of the firm.

Correction of data – This is the step of collecting various kinds of information‟s &

data related with future demands of products.

Analysis of market potential – The next step is to analyze the data of market

potential . Analysis requires two steps>> a) Select the market associated with

product demand. b) Eliminate those market segments that do not contain

prospective business.

Forecasting of future sales:-

Sales projection should be made for an entire product line or for an individual

Product or for companies total market or individual market segment.

Making operational programme & the budget :-

The firm determines the requirements for various operational activities such as

production purchasing marketing capital assets. On the basis of forecast the related plans

such as sales budget sales quotes sales publicity and material acquirement are formulated

Derivation of a sales volume objectives:-

A sales volume objectives for the coming operative period is hoped for the outcome of a

company‟s short range sales forecasting procedure, The sales volume should be

consistent with managements profit aspirations and the companies market capabilities.

Evaluation & revision of forecasts:-

The sales executives should evaluate the forecasts carefully. The company should

examine all the assumption on which it is based. The company should the forecasting

process periodically. The first step in the review is to determine the accuracy of past

forecasts to learn if changes are needed in the way forecasts are made if the company


45

finds that sales forecasts are significantly different from actual sales in the period it

should undertake a review of the sales forecasting process.

Techniques of sales forecasting:-

I. Survey methods:-

a) Executive opinion

b) Prudent manager forecasting

c) Delphi method

d) Sales force composite

e) Detecting differences in figures

f) Survey of buyer intention

g) Product testing and test marketing.

a) Executive opinion – It consists of obtaining the views of top executives

regarding future sales. The forecasts made by executives are arranged to yield

one forecast for all executives or the differences are reconciled through

discussion.

b) Product manager forecasting – In this method the company personnel are

asked to assume the position of purchasers in customer companies. They must

then look at company sales from a customer‟s view point & prudently

evaluate sales.

c) Delphi method – This method begins with a group of knowledgeable

individuals estimating future sales. Each person makes a prediction without

knowing others in the group have responded. these estimates are summarized.

Now knowing how the group responded. They are asked to make another

production on the same issue. This process of estimates & feedback is

continued for several rounds. In final round involves face to face discussions

among the participants.

d) Sales force composite – This method is based on collecting an estimates from

each salesperson of the products they expect to sell in the sale forecast period.

The estimate may be made in consultation with sales executives and

customers.

e) Detecting differences in figures method – In this method the sales person

produces figures broken down by product & customers and the area manager

produces figures for the sales persons territory. They then meet & must

reconcile any differences in figures. the process proceeds with the area

manager producing territory by figures.

f) Surveys of buyer‟s intentions – This method consist of contacting potential

customers & questioning them about whether or not they would purchase the

product at the price asked.

g) Product testing & test marketing – This technique is of value for new or

modified products for which no previous sales figures exists & where it is

difficult to estimate. Likely demand. It involves placing the pre production

model with a sample of potential users beforehand & noting their reactions to

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the product. Test marketing involves the limited launch of a product in a

closely defined geographical test area.

II. Mathematical methods :-

a) Moving average technique – Simplest way to forecast sales is to predict that

sales in the coming period will be equal to sales in the best period. This

forecasts assumes that conditions in the last period will be same as the

conditions in the coming period.

SALES t+1 salest + salest-1 + sales + s………………… salest-n

SALESt+1 = Forecasted sales

SALESt = Sales in the present period.SALESt+1 = Sales in the period

immediately past.

b) Exponential smoothing models – It is a type of moving average that

represents a weighted some of all past numbers in a time series. with the

heaviest weight placed on the most recent data.

c) Regression analysis – This technique is used to project sales trends in the

future. The sales plotted are for each past time period. It determines and

measures the associations between the sales & other variables.

d) Projection of past sales – It takes a variety of forms.

To set the sales forecasts for the coming year at the same figure.

May be moving average of the sales figures for several past years.

e) Time series analysis – It is a statistical procedure for studying historical sales

data this process involves measuring 4 types of sales variations – long term

trends, cyclical changes, seasonal variations & regular fluctuations. Then a

mathematical model about the past behavior of the series is selected assumed

values for each types of sale variation are insisted and sale forecast is made.

f) Market factor analysis – Market factor analysis determines market factors &

measures their relationships to sales activity.

g) Correlation analysis – This method takes in to account the association

between potential sales of the product and market factor affecting its sales.

h) E-charts – this technique is furtherance of moving average technique . It also

shows the monthly sales & cumulative sales.

Q.3 Define sales quotas . What are the objectives & methods of sales quotas?

Ans. A sales quota is a quantitative goal assigned to a sales unit relating to a particular

period of time. A sales unit may be a territory, branch, office, region, distributor or

a person. A sales quota is a sales set for a product line, company division or sales

representative. A sales quota is sales goal assigns to a marketing unit for use in the

management of the sales efforts. Sales quota is sales performance goal.

Objective of sales quota:-

1. Life blood of business.

2. To provide performance standards.

3. To maintain a check on sales & expenses.

4. To motivate deserted performance.


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5. Serves as a basis o sales contests.

6. It reflects overall sales plan.

7. To make goals obtainable.

8. It gives a sense of direction to salesmen.

9. It serves a basis of compensation.

10. Helps in evaluating performance.

11. It provides change of direction.

12. It helps in balancing growth of market.

13. It helps in proposing promotional budgets.

14. Equals the workload & estimating the future needs.

15. Avoid repetition of work.

16. Coordinates with other departments.

Methods for setting sales quotas:-

1. Forecasts & potentials based methods – The company makes a total volume or

unit sales forecast for the company, product lines & individual products this methods

includes a) quotas derived from territorial sales potential b) Quotas derived from

total market estimates.

2. Only forecasts based methods – This method is common for the large scale

companies, some companies determines sales potential for individual sales territories.

This is especially true for companies that sale in small geographical areas.

3. Past experience method – Some companies take the past year sales for each

geographic unit & use result as their sales volume quotas.

4. Executive judgment method – This method is useful when little information

exists. Manages sely on their judgments to make failure predictions.

5. Salesmen judgment method – It is used in companies expanding in to new

geographic areas or starting up a sales force. no past sales exists on which to base

future estimates.

Q. 4 Write short note on sales territories.

Ans. A sales territory represents a group of customers or markets or geographical

areas A sales territory is a configuration of current and potential accounts for

which responsibility has been assigned to a particular sales.

Objective :-

1. Maximizes sales and profits.

2. enhances customers courage.

3. Matches selling efforts & opportunities.

4. Helps in realistic sales planning.

5. Controls sales operations.

6. Controls selling expenses.

7. Helps in evaluating sales personnel.

8. Contributes to high morale

9. Promotes productive salesmen.

10. Establishes salesmen responsibilities.

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11. improves customer relations.

12. better matching of salesmen to customer.

13. Ciduabtes personnel selling and advertising.

14. Benefits salesmen & company.

15. Provides more equitable rewards.

Designing sales territories:-

1. Deciding objectives & allocation criteria of territory formation.

2. Selecting basic control units or bases for territorial boundaries. On the bases

of geography, trading, areas, portals, serving, requirements, workload, product

lines customers & prospects.

3. Determining sales potential present in control units.

4. Analyze sales people workloads- on the basis of nature of the job, intensity of

market coverage, type of product sold.

5. Combining control units in to tentative territories.

6. Determining basic territories.

7. Assigning sales people to territories.

8. Preparing customer contact plan.

9. Evaluation & revision of sales territories.

Q.5 Define consumer psychology. What are the reasons for studying consumer

psychology?

Ans. Consumer psychology is concerned with the study of consumer mind. It is the

study of thought process going on in the consumer mind, their reactions, desires,

values, perceptions, altitudes etc.

OR It is the study of consumer mind and his behavior particularly his perceptions

learning experiences, personalities, attitudes and self image.

Objectives:-

1. To develop effective marketing strategy to compete.

2. To make aware the customers about various promotion techniques used by

produces.

3. To study buying motives vision & thoughts.

4. To conduct market research more efficiently.

5. To take appropriate definition regarding product development, product lines,

product differentiation.

6. To facilitate effective market segmentation.

7. To design marketing mix elements based on consumer needs, buying patterns.


49

Methods for studying consumer behaviors:-

1. Observation method – The salesmen observes behavior pattern of consumers

& make a note of it. Certain mechanical devices like molding, cameras, close

circuit TV etc. are used for appointment & observation.

2. Interview method - The interviewer directly interviews the consumers and

records various information relating to consumers attitudes, Like & dislikes,

lifestyles, income, paying capacity, perception etc.

3. Questionnaire method – A questionnaire is prepared related to psychological

behavior of customers. This is mailed to certain selected customers & then the

received information is tabulated & analyzed.

4. Experimental method – The researcher conducts experiments on consumer

behavior on a selected number of customers & the conclusions thus arrived

are given effects or a large group of customers.

5. Consumer panel method – The researcher makes a list of customers and

these are contacted at different occasions & collect various kinds of

information and data relating to these behavior on the basis of which

conclusions are worked out.

6. Case study method – Certain facts and figures of selected customers relating

to their family background social & individual life styles are gathered and on

the basis of analysis, customer interests and buying motives are determined.

Q. 6 Write short notes on buying motives.

Ans. A motive may be defined as a derive for which on individual seeks satisfaction

buying motives are those influences or considerations which provide the impulse

to buy, induce action or determine choice in the purchase of goods & services.

Classification of buying motives:-

1. Physical psychological and sociological buying motives.

2. Acquired & inherent buying motives- Level of education, information, beauty

and fashion social prestige, work efficiency acceptance etc.

3. Primary & selecting buying motives.

4. Conscious & dormant buying motives.

5. Rational & Emotional buying motives.

6. Product and patronage buying motives.

Q. 7 What do you mean by sales control. Discuss its importance and process.

Ans. Sales control is to identify weaknesses in sales efforts to determine their causes &

to correct them quickly with the objectives of servicing the greatest possible

amount of profitable business.

The primary purpose of sales control is to discover weak spots in sales

performance and to maintain & improve the efficiency of sales operations.

Importance:-

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1. To implement sales planning in an effective way.

2. Control of unnecessary expenses.

3. To evaluate the performance of sales force.

4. To determines the various requirements related with sales promotion.

5. To concentrate on the sales of maximum profitable products at profitable

territories and customers.

6. Coordinating the effort of sales functions & results.

Sales control process:-

1. Establishing sales performance standards.

2. Recording actual performance.

3. Evaluating performance against standards.

4. Taking appropriate actions.

Q.8 What are sales reports. Discuss the essentials of sales report.

Ans. Sales reports provide the sales manager with an basis for discussion with sales

personnel. They indicate the manners on which the sales people need assistance.

They also assist in determining how to secure more & larger orders. Field sales

reports provide the raw material that sales management process gain insights on

giving needed direction to field sales personnel.

These are various types of sales reports:-

1. Progress reports

2. Expenses report.

3. Sells planning report.

4. New business report

5. Lost sales report

6. Complaint and adjustment report.

Essential of a report :-

1. Should be simple.

2. irrelevant information should not be included.

3. Brief and object oriented .

4. Should be useful to make an easy assessment of performance of salesmen.

5. Should be of optimum size.

6. case should be given to make different types of reports in the format

prescribed for the purpose.

7. Salesmen suggestion should be given in the report.

8. Should be free from any person bias.


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1. Which of the following part of selling process?

1. Presale preparation

2. Prospecting or locating customers

3. Pre- Approach before interview

4. ALL OF THE ABOVE

2. Which of the following is a method for setting sales quotas

1. Only forecasts based methods

2. Past experience method –

3. Forecasts & potentials based methods

4. All of the above

3 Amotive is a derive which gives_______

1.hatered

2.love

3.satisfaction

4.none of the above

4 Which of the following is a method of studying consumer behavior?

1. Observation method

2.Interview method

3.Questionnaire method

4.all of the above

5 Consumer psychology is the study of ______

1.consumer mind

2.buyer mind

3.dealers mind

4.all of the above

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―CASE STUDY‖

Toothpaste industry has grown immensely in the Indian scenario. There is a lot of

competition in the industry mainly between two major players Colgate and HLL .The

companies are coming up with new schemes as well as products to lure the customers.

The usage of toothpaste has grown because of the lifestyle and the way the individuals

are living i.e. more awareness about health. Colgate is going ahead with almost 60% of

the market share in the industry.

The title of the project was “study on consumer buying behavior in the toothpaste

industry”.

The objectives of the study were to “Study the consumer buying habit” and “to study the

toothpaste brands to identify important parameters for customer”.

The questionnaire methodology was adopted and the consumers and the sales officer in

companies were contacted in order to have their view on toothpaste. The area of the study

was restricted to Gurgaon 100 respondents were contacted .The sales managers in two

companies were contacted and their views were known in terms of how they were going

in the toothpaste segment.

It was found that many firms are in the toothpaste segment. So it is a highly competitive

segment. It was found that focus as well as cost leadership was being followed by the

firms when they were going in the toothpaste segment.

The firms are more and more focusing on the promotion and they are spending a lot of

money on this front. Customers are also becoming demanding now-a-days and it is seen

that many attributes are important for the success of a particular brand. The firms are

going in for new launches.

It is found that the discounts are important factor. Another important factor is brand

image or brand name.

The project provided an opportunity to know about a competitive segment and how

consumers behave in that segment. It also provided an insight into the toothpaste industry

and the attitude and perception of the consumer in that segment.

Objective of the Study:

To study the Consumer Buying habits in Toothpastes.


53

To study the various factor and identify important parameters for customer

acceptance.

To plot popular Toothpastes Brands on the perceptual maps.

Scope of the Study: (1) Identification of gaps in positioning stances.

(2) Identification of consumer perceptions and attitudes regarding Oral hygiene.

Conclusions: The toothpaste industry is going to be more competitive in the near future. The profit

margin is going down over the year and going to be continuing for the future also. So the

main mantra for the companies to be successful is to satisfy the consumers and develop

brand image and brand loyalty amongst them.

So it has become very necessary for the consumers to understand the Indian consumers

very well. So in the future the companies who come up with new products at competitive

prices and with good quality are going to the successful one. Promotional activities are

also going to play an important role that should to be for both retailers and consumers.

So we are going to see a market which is going to heat up in the near future where mainly

two major players Colgate and HLL will fight the war.

Suggestions:

The companies should give more emphasis on advertising and sales promotion as

the competition is becoming tougher and tougher. So they need to make some

brand image amongst the consumers.

The customers are becoming king as they have a whole lot of choices. So the

companies should try to be cost effective and pass on the saved amount to the

customer.

Retailers are still the place to buy toothpaste. So the companies should focus on

retailers also who is also a customer for their products.

The companies should try to launch new products after through research of the

consumers as they are becoming more dynamic day by day.

Limitations:

The responses can be biased, as some of the respondents may not have revealed

the true pictures.

The company officials also too tend to give biased answers, as they always want

to give a rosy picture of their company.

The managers were reluctant to give information about the product.

The sample was restricted to the Gurgaon region only.

54

“ Case study”

MTV practiced a glocalized brand strategy in order to be the favorite music channel for

its target market. It went in for local recruitment, customizing its program content to suit

local needs, coming out with innovative programs, and at times following instinct rather

than research. The caselet also describes the new challenges that MTV faced while airing

programs based on psychographic segmentation.

Issues:

» Challenges faced by a broadcasting company which caters to

markets around the globe

» Challenges faced by a broadcasting company while airing

programs based on psychographic segmentation

» Strategies followed by broadcasting companies to attract the

target markets

MTV had been airing programs primarily devoted to music

videos since its inception in 1981. In 1985, MTV became a

part of Viacom when Viacom acquired Warner-Amex Satellite

Entertainment, which owned MTV.

A number of rock bands and artists like Bon Jovi, Duran Duran, Madonna, and Michael

Jackson rose to prominence through MTV. As the brand matured through the two

decades of its existence, MTV had to straddle the two generations of X and Y.

The company still managed to be successful in maintaining the freshness in its program

offerings while catering to the needs of both the generations...

Questions for Discussion:

1. How was MTV successful in increasing the level of involvement with the target

market?

2. How did MTV try to maintain its relevance with the changing demographics?

Elaborate.


55

B. Com (Part-I) Examination, 2011 BUSUNESS ADMINISTRATION

Second Paper

Sales Promotion and Sales Management Time: One Hour Max. Marks: 40

Objective Part- I

Attempt all questions.

1. Answer following question in not more than 20 words each. Each question carries

2 marks.

i. What do you mean by Salesmanship?

ii. What do you mean by sales promotion programme?

iii. What do you understand by Organisation of Sales Promotion Department

on the basis of target?

iv. What is impersonal selling?

v. Explain the ethical qualities of salesman.

vi. What do you mean by fringe benefits?

vii. What do you understand by „Objection of Customer‟?

viii. What is meant by sales forecasting?

ix. What is meant by monetary sales volume quota?

x. What is perception?

2. Answer each of the following in not more than 50 words each. Each question

carries 4 marks.

i. “Advertising and Sales Promotion supplement to each other.” Comment.

ii. Explain the co-operative sales promotion.

iii. Enumerate the measures taken by the Government of India for export sales

promotion.

iv. How can the buying motive of a customer be discovered?

v. Briefly explain the salesman‟s control techniques.

56

Descriptive Part II Time: Two Hour Max. Mark : 60

Attempt all the three questions, selection one question from each section. Each question

carries 20 marks. Each question has internal choice in the form of either/or.

Section-A

3. What do you understand by consumer promotion methods? Discuss various types

of consumer promotion methods.

or

Explain the difference between export sales promotion and export promotion and

discuss the various methods of export sales promotion.

Section B

4. “The fortune of a concern depends on sales which in turn, depends on salesman”

Discuss this statement, explaining the selection procedure of salesman.

or

Explain the main methods of training for salesmen.

Section C

5. Discuss the main steps of a sales call.

or

What do you mean by „Sales Quota‟? Critically evaluate the various methods of

setting quota.


57


Second Paper


Objective Part- I



2 marks.

i. What do you mean by "Pubic Relation"?

ii. What is premium?

iii. What is meant by Solo exhibition?

iv. Enumerate the primary functions of Sales Management.

v. What is personal selling?

vi. Explain the principle of unity of command.

vii. What is principle of unity of command?

viii. Enumerate the name of the steps selling sequence suggested.

ix. What do you mean by sales territory?

x. Enumerate the steps control process.


carries 4 marks.

i. Advertising and sales promotions are supplement to each other comment.

ii. Briefly distinguish between sales management and Marketing

Management.

iii. Explain the various schemes of Buying Motives Inspiration.

iv. State the objectives Of Sales Training.

v. How can a salesman create interest of a prospect in the goods?

58


Attempt all the three questions, selection one question from each section. Each question

carries 20 marks. Each question has internal choice in the form of either/or.

Section-A

3. What do you mean by 'Sales Promotion‟? Discuss the importance of sales

promotion in the moderns age.

or

What do you mean by evaluation of sales promotion programe? Explain is

importance?

Section B

4. “A good salesman is born and note made." Describe in brief the essential qualities

of an ideal salesman.

or

What do you mean by selling? Explain the importance of selling in a planned

economy.

Section C

5. What do mean by objection of customers? Narrate the factors that are required to

keep in mind while handling the various of customers.

or

What do you mean by consumer psychology? Describe the various methods of

studying consumer psychology.


59


Second Paper


Objective Part- I



2 marks.

(i) What is the main objective of sales promotion?

(ii) Statement four characteristics of sales promotion?

(iii) What do you mean by consumer promotion?

(iv) What are the managerial functions of a sales manager?

(v) State four ethical qualities of a salesman.

(vi) In which circumstances line organization is treated suitable for

sales organization?

(vii) What do you mean by salesman job description?

(viii) What do you mean by sales volume quota?

(ix) State tow main objective of sales forecasting?

(x) What do you mean by salesman's report?


carries 4 marks.

(i) Explain dealer contest.

(ii) Describe the objectives of evaluation of sales promotion

progremme.

(iii) What is the significance of product knowledge for salesmen?

(iv) What is the need of motivating a salesman?

(v) What do you mean by consumer psychology??

60


Attempt three questions in all, selecting at least one question from each section. Each

question carries 20 marks. Each question has internal choice in the form of either/or.

Section-A

3. How is vales promotion different as compared to advertising? Discuss the various

methods of industrial product and dealer promotion.

or

Write notes on the following :

(i) Sales promotion limitations in an Economy of shortages.

(ii) Export sales promotion.

Section B

4. What is the role of selling in a planned economy like ours? Discuss significance of

customer relations in buyer's market?

or

What are the factors affecting salesman remuneration? Discuss the merits and

demerits of “Straight commission plan”?

Section C

5. What do you mean by division of sales territory? Describe various methods of

dividing sales territories and discuss briefly the factors affecting their size.

or

What do you mean by meeting selling cost? Discuss various methods of sales cost

control.


61


Second Paper


Objective Part- I



2 marks.

(i) What is meant by "Personal Selling?

(ii) State the objectives of sales promotion.

(iii) What is point of purchase display?

(iv) Explain the meaning of selling.

(v) Who is called merchant salesman?

(vi) What is meant by "turnover of salesmen?

(vii) What do you mean by motivating salesman?

(viii) Explain the meaning of performance appraisal of salesmen.

(ix) What is long range sales fore cast?

(x) Define “Buying Motive"?


carries 4 marks.

(i) Explain functional demonstration.

(ii) What is the ability of effective speaking for a salesman?

(iii) Who are “voluntary applicants?

(iv) Describe the process of controlling salesmen.

(v) What is customer compliant report?

62




Section-A

3. What do you mean by “Promotion”? Explain its main techniques.

or

Describe in details the various modern methods of consumer promotion.

Section B

4. Define "Sales Management"? Explain its functions.

or

What is meant by “Selection of salesmen”? Describe the factor to be considered

in selection of salesmen?

Section C

5. What do you mean by "sales forecasting”? Describe the factors affecting sales

forecast.

or

Discuss the classification of buying motives.


63


Second Paper


Objective Part- I



2 marks.

(i) What do you mean by "Public Relation”?

(ii) Enumerate the forms of sales promotion department.

(iii) What is "Premium"?

(iv) What is meant by “Solo Exhibition”?

(v) What is meant by "Sales Management”?

(vi) What is ' Impersonal sale"

(vii) What do you mean by "Sales Quota"?

(viii) Define the fringe benefits?

(ix) What is meant by the objection of customer?

(x) What do you mean by "Sales Territory?


carries 4 marks.

(i) Distinguish between sales promotion and salesmanship.

(ii) Enumerate the measure taken by the central government for export sales

promotion.

(iii) Stat the objective of sales training.

(iv) Explain the objective of sales control

(v) State the sources of prospecting.

64




Section-A

3. Define sales promotion and states the reasons of its ever increasing importance in

the modern age.

or

Explain the difference between export sales promotion and export promotion and

discuss the various methods of export sales promotion.

Section B

4. “A good salesman is born and not made “Explain the statement. Describe in brief

the essential qualities of an ideal salesmen.

or

Describe the function sales manager in a sales organization.

Section C

5. What is consumer psychology? Explain the various methods of studying consumer

psychology.

or

Discuss the utility of salesman report. What are their types? What factors should

be considered while preparing such a report.


65


Second Paper


Objective Part- I



2 marks.

(i) What do you mean by sales promotion research?

(ii) What is meant by demonstration of goods?

(iii) What is meant by sales management?

(iv) What do you mean by effectives speaking?

(v) Define “Sales organization”.

(vi) What is meant by selection test?

(vii) What do you mean by controlling sales force?

(viii) What do you mean by sales quota?

(ix) What is consumer psychology?

(x) Explain the meaning of "Closing Sale"


carries 4 marks.

(i) Enumerate the four primary functions of sales promotion department

(ii) State the objectives of export sales promotion.

(iii) State the four advantages of proper selection of salesmen.

(iv) Explain the factors that are required to keep in mind while handling the

objection of customers.

(v) Explain the four objectives of sales control.

66




Section-A

3. What do you mean by sales promotion? How does it differ from advertising?

or

What do you by evaluation of sales promotion programme? Explain its

importance.

Section B

4. "Selling is a creative activity". Explain describe the importance of selling in an

economy?

or

What is meant by motivating salesmen? What is need for motivating the

salesmen?

Section C

5. What do you mean by sales forecast ion? Describe the factor affecting sales

forecast.

or

What do you mean by buying motives? Describe the different buying motives.

concept based notes sales promotion and sales...

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