sales promotion and personal selling

52
1 Chap. 16 Marketing 7e Lamb Hair McDaniel ©2004 South-Western/Thomson Sales Promotion and Sales Promotion and Personal Selling Personal Selling Prepared by Prepared by Deborah Baker Deborah Baker Texas Christian University Texas Christian University Chapter 16

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Sales Promotion and Personal Selling. Chapter 16. Prepared by Deborah Baker Texas Christian University. Learning Objectives. 1.Define and state the objectives of sales promotion. 2. Discuss the most common forms of consumer sales promotion. - PowerPoint PPT Presentation

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Page 1: Sales Promotion and  Personal Selling

1Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Sales Promotion and Sales Promotion and Personal SellingPersonal Selling

Prepared byPrepared byDeborah BakerDeborah Baker

Texas Christian UniversityTexas Christian University

Chapter 16

Page 2: Sales Promotion and  Personal Selling

2Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Learning ObjectivesLearning Objectives

1. Define and state the objectives of sales promotion.

2. Discuss the most common forms of consumer sales promotion.

3. List the most common forms of trade sales promotion.

Page 3: Sales Promotion and  Personal Selling

3Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Learning Objectives Learning Objectives (continued)(continued)

4. Describe personal selling.

5. Discuss the key differences between relationship selling and traditional selling.

6. List the steps in the selling process.

7. Describe the functions of sales management.

Page 4: Sales Promotion and  Personal Selling

4Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Learning Objective Learning Objective

Define and state the objectives of sales promotion.

11

On Linehttp://www.nba.com/maverickshttp://www.mavs.com

On Linehttp://www.nba.com/maverickshttp://www.mavs.com

Page 5: Sales Promotion and  Personal Selling

5Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Sales PromotionSales Promotion

Marketing communication

activities, other than

advertising, personal

selling, and public

relations, in which a

short-term incentive

motivates a purchase.

11On Linehttp://www.onlineclothingstores.comhttp://www1.coolsavings.com

On Linehttp://www.onlineclothingstores.comhttp://www1.coolsavings.com

Page 6: Sales Promotion and  Personal Selling

6Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Sales Promotion TargetsSales Promotion Targets

ConsumerSales Promotion

ConsumerSales Promotion

Trade Sales Promotion

Trade Sales Promotion

11

Page 7: Sales Promotion and  Personal Selling

7Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Uses of Sales PromotionUses of Sales Promotion

Immediate purchasesImmediate purchases

Increase trialIncrease trial

Boost consumer inventoryBoost consumer inventory

Encourage repurchaseEncourage repurchase

Increase ad effectivenessIncrease ad effectiveness

Encourage brand switchingEncourage brand switching

Encourage brand loyaltyEncourage brand loyalty

11

Page 8: Sales Promotion and  Personal Selling

8Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Objectives of Sales PromotionObjectives of Sales Promotion

Type of BuyerType of Buyer Type of BuyerType of Buyer

Loyal CustomersLoyal Customers

Competitor’sCustomersCompetitor’sCustomers

Brand SwitchersBrand Switchers

Price BuyersPrice Buyers

Desired ResultsDesired Results Desired ResultsDesired Results

•Reinforce behavior• Increase consumption•Change timing

•Reinforce behavior• Increase consumption•Change timing

•Break loyalty•Persuade to switch•Break loyalty•Persuade to switch

•Persuade to buy your brand more often•Persuade to buy your brand more often

•Appeal with low prices•Supply added value

•Appeal with low prices•Supply added value

Sales PromotionSales PromotionExamples Examples

Sales PromotionSales PromotionExamples Examples

•Loyalty marketing•Bonus packs•Loyalty marketing•Bonus packs

•Sampling•Sweepstakes, contests, premiums

•Sampling•Sweepstakes, contests, premiums

•Price-lowering promotion•Trade deals

•Price-lowering promotion•Trade deals

•Coupons, price-offpackages, refunds•Trade deals

•Coupons, price-offpackages, refunds•Trade deals

11

Page 9: Sales Promotion and  Personal Selling

9Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Learning Objective Learning Objective

Discuss the most common forms of consumer sales promotion.

22

Page 10: Sales Promotion and  Personal Selling

10Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Tools for Tools for Consumer Sales PromotionConsumer Sales Promotion

Coupons and RebatesCoupons and Rebates

PremiumsPremiums

Loyalty Marketing ProgramsLoyalty Marketing Programs

Contests & SweepstakesContests & Sweepstakes

SamplingSampling

Point-of-Purchase PromotionPoint-of-Purchase Promotion

22

Page 11: Sales Promotion and  Personal Selling

11Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

CouponCoupon

RebateRebate

PremiumPremium

A certificate that entitles consumers to an immediate

price reduction.

A certificate that entitles consumers to an immediate

price reduction.

A cash refund given for the purchase of a product during

a specific product.

A cash refund given for the purchase of a product during

a specific product.

An extra item offered to the consumer, usually in exchange

for some proof of purchase.

An extra item offered to the consumer, usually in exchange

for some proof of purchase.

Tools for Tools for Consumer Sales PromotionConsumer Sales Promotion

22

Page 12: Sales Promotion and  Personal Selling

12Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

LoyaltyMarketingProgram

LoyaltyMarketingProgram

FrequentBuyer

Program

FrequentBuyer

Program

A promotional program designed to build long-term, mutually

beneficial relationships between a company and key customers.

A promotional program designed to build long-term, mutually

beneficial relationships between a company and key customers.

A loyalty program in which loyal consumers are rewarded for making multiple purchases.

A loyalty program in which loyal consumers are rewarded for making multiple purchases.

Tools for Tools for Consumer Sales PromotionConsumer Sales Promotion

22

Page 13: Sales Promotion and  Personal Selling

13Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

ContestContest

SweepstakesSweepstakes

Promotions that require skill or ability to compete for prizes.

Promotions that require skill or ability to compete for prizes.

Promotions that depend on chance or luck, with

free participation.

Promotions that depend on chance or luck, with

free participation.

Tools for Tools for Consumer Sales PromotionConsumer Sales Promotion

22

On Linehttp://www.sweepstakesonline.com

On Linehttp://www.sweepstakesonline.com

Page 14: Sales Promotion and  Personal Selling

14Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

SamplingSampling A promotional program that allows the consumer the opportunity to try a

product or service for free.

A promotional program that allows the consumer the opportunity to try a

product or service for free.

Tools for Tools for Consumer Sales PromotionConsumer Sales Promotion

22

Page 15: Sales Promotion and  Personal Selling

15Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

SamplingSampling

Methodsof

Sampling

Methodsof

Sampling

Direct mailDirect mail

Door-to-door delivery

Door-to-door delivery

Packaging with another productPackaging with another product

Retail store demonstrationRetail store

demonstration

22

Page 16: Sales Promotion and  Personal Selling

16Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Tools for Tools for Consumer Sales PromotionConsumer Sales Promotion

Goals ofGoals of Point-of-PurchasePoint-of-Purchase

DisplaysDisplays

Goals ofGoals of Point-of-PurchasePoint-of-Purchase

DisplaysDisplays

Build traffic Build traffic

Advertise the productAdvertise the product

Induce impulse buyingInduce impulse buying

22

Page 17: Sales Promotion and  Personal Selling

17Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

On Linehttp://www.burgerking.comhttp://www.philipmorris.comhttp://www.upromote.com

On Linehttp://www.burgerking.comhttp://www.philipmorris.comhttp://www.upromote.com

Tools for Tools for Consumer Sales PromotionConsumer Sales Promotion

Free merchandiseFree merchandise

SweepstakesSweepstakes

Free shippingFree shipping

CouponsCoupons

EffectiveTypes ofOn-LineSales

Promotion

EffectiveTypes ofOn-LineSales

Promotion

22

Page 18: Sales Promotion and  Personal Selling

18Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Learning Objective Learning Objective

List the most common forms of trade sales promotion.

33

Page 19: Sales Promotion and  Personal Selling

19Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Tools for Trade Sales Tools for Trade Sales PromotionPromotion

Trade AllowancesTrade Allowances

Push MoneyPush Money

TrainingTraining

Free MerchandiseFree Merchandise

Store DemonstrationStore Demonstration

Conventions & Trade ShowsConventions & Trade Shows

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Page 20: Sales Promotion and  Personal Selling

20Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Trade AllowanceTrade Allowance

A price reduction offered

by manufacturers to

intermediaries, such as

wholesalers and retailers.

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Page 21: Sales Promotion and  Personal Selling

21Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Push MoneyPush Money

Money offered to channel

intermediaries to encourage

them to “push” products--

that is, to encourage other

members of the channel to

sell the products.

33

Page 22: Sales Promotion and  Personal Selling

22Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

The Role of The Role of Trade Sales PromotionTrade Sales Promotion

Improve trade relations

Gain new distributors

Build or reducedealer inventories

Obtain support forconsumer sales promotions

33

Page 23: Sales Promotion and  Personal Selling

23Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Learning Objective Learning Objective

Describe personal selling.

44

Page 24: Sales Promotion and  Personal Selling

24Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Advantages of Personal Advantages of Personal SellingSelling

Provides a detailed explanation or demonstration of product

Message can be varied to fit the needs of each prospective customer

Can be directed to specific qualified prospects

Costs can be controlled by adjusting sales force size

Most effective method to obtain sales and gain satisfied customers

44

Page 25: Sales Promotion and  Personal Selling

25Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Personal SellingPersonal Selling

Customers are concentrated

Customers are concentrated

There are few customersThere are few customers

Product is technically complex

Product is technically complex

Product is custom madeProduct is custom made

Product has a high valueProduct has a high value

Personal Selling Personal Selling is more important if...is more important if...

Customers are geographically dispersed

Customers are geographically dispersed

There are many customersThere are many customers

Product is simple to understand

Product is simple to understand

Product is standardizedProduct is standardized

Product has a low valueProduct has a low value

Advertising & Sales Promotion Advertising & Sales Promotion are more important if...are more important if...

44

Page 26: Sales Promotion and  Personal Selling

26Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Learning Objective Learning Objective

Discuss the key differences between relationship selling and traditional selling.

55

Page 27: Sales Promotion and  Personal Selling

27Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Relationship SellingRelationship Selling

A sales practice that

involves building,

maintaining, and enhancing

interactions with customers

in order to develop long-

term satisfaction through

mutually beneficial

partnerships.

55

Page 28: Sales Promotion and  Personal Selling

28Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Relationship Selling Relationship Selling vs. Traditional Sellingvs. Traditional Selling

Sell advice, assistance, counsel Sell advice, assistance, counsel Sell products

TraditionalTraditionalPersonal SellingPersonal Selling

Focus on closing salesFocus on closing sales

Limited sales planningLimited sales planning

Discuss productDiscuss product

Assess “Product-specific” needsAssess “Product-specific” needs

“Lone wolf” approach“Lone wolf” approach

Pricing/product focusPricing/product focus

Short-term sales follow-up Short-term sales follow-up

Focus on customer’s bottom lineFocus on customer’s bottom line

Sales planning is top prioritySales planning is top priority

Build problem-solving environmentBuild problem-solving environment

Conduct discovery in scope of operationsConduct discovery in scope of operations

Team approachTeam approach

Profit impact and strategic benefit focusProfit impact and strategic benefit focus

Long-term sales follow-up Long-term sales follow-up

Relationship SellingRelationship Selling

55

Page 29: Sales Promotion and  Personal Selling

29Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Learning Objective Learning Objective

List the steps in the selling process.

66

Page 30: Sales Promotion and  Personal Selling

30Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Sales ProcessSales Process

The set of steps a

salesperson goes through

in a particular organization

to sell a particular

product or service.

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Page 31: Sales Promotion and  Personal Selling

31Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Steps in the Selling ProcessSteps in the Selling Process

Generate LeadsGenerate Leads

Qualify LeadsQualify Leads

Probe Customer NeedsProbe Customer Needs

Develop SolutionsDevelop Solutions

Handle ObjectionsHandle Objections

Close the SaleClose the Sale

Follow UpFollow Up

66

Page 32: Sales Promotion and  Personal Selling

32Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Time Spent in Key Steps Time Spent in Key Steps of Selling Processof Selling Process

Key Selling Steps Traditional

Selling

Relationship

Selling

Generate Leads High Low

Qualify Leads Low High

Probe Needs Low High

Develop Solutions Low High

Handle Objections High Low

Close the sale High Low

Follow-up Low High

66

Page 33: Sales Promotion and  Personal Selling

33Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

On Linehttp://www.goleads.comhttp://www.zapdata.com

On Linehttp://www.goleads.comhttp://www.zapdata.com

Generating LeadsGenerating Leads

Cold CallingCold CallingAdvertisingAdvertising PublicityPublicity Direct Mail/TelemarketingDirect Mail/

Telemarketing

Trade Shows/Conventions

Trade Shows/Conventions

Internet Web Site

Internet Web Site ReferralsReferrals NetworkingNetworking

Company Records

Company Records

Sources ofSources ofSales LeadsSales LeadsSources ofSources of

Sales LeadsSales Leads

66

Page 34: Sales Promotion and  Personal Selling

34Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Cold CallingCold Calling

A form of lead generation in

which the salesperson

approaches potential

buyers without any prior

knowledge of the

prospects’ needs or

financial status.

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Page 35: Sales Promotion and  Personal Selling

35Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Qualifying LeadsQualifying Leads

Recognized NeedRecognized Need

Buying PowerBuying Power

Receptivity & Accessibility

Receptivity & Accessibility

Characteristics ofCharacteristics ofQualified LeadsQualified Leads

Characteristics ofCharacteristics ofQualified LeadsQualified Leads

66On Linehttp://www.hoovers.comhttp://www.dnb.com

On Linehttp://www.hoovers.comhttp://www.dnb.com

Page 36: Sales Promotion and  Personal Selling

36Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Needs AssessmentNeeds Assessment

A determination of the

customer’s specific needs

and wants and the range

of options a customer has

for satisfying them.

66

Page 37: Sales Promotion and  Personal Selling

37Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Probing NeedsProbing Needs

Product or serviceProduct or service

Customers and their needsCustomers and their needs

CompetitionCompetition

IndustryIndustry

Salesperson must knoweverything

about...

Salesperson must knoweverything

about...

66

Page 38: Sales Promotion and  Personal Selling

38Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Developing and Developing and Proposing SolutionsProposing Solutions

Sales ProposalSales Proposal

Sales PresentationSales Presentation

66

Page 39: Sales Promotion and  Personal Selling

39Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Handling ObjectionsHandling Objections

Handling Handling

ObjectionsObjections

Handling Handling

ObjectionsObjections

Use the objection to close the sale

Use the objection to close the sale

Anticipate specific objections

Anticipate specific objections

View objections as requests for information

View objections as requests for information

66

Page 40: Sales Promotion and  Personal Selling

40Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Closing the SaleClosing the Sale

Closing Closing the Salethe Sale

Closing Closing the Salethe Sale

NegotiateNegotiate

Keep an open mindKeep an open mind

Look for customer signals

Look for customer signals

66

Page 41: Sales Promotion and  Personal Selling

41Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Following UpFollowing Up

ResponsibilitiesResponsibilitiesinin

Following UpFollowing Up

ResponsibilitiesResponsibilitiesinin

Following UpFollowing Up

Employees are trainedEmployees are trained

Goods or service performas promised

Goods or service performas promised

Ensure delivery schedules are metEnsure delivery

schedules are met

66

Page 42: Sales Promotion and  Personal Selling

42Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Learning Objective Learning Objective

Describe the functions of sales management.

77

Page 43: Sales Promotion and  Personal Selling

43Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Sales Management ResponsibilitiesSales Management Responsibilities

Evaluate sales forceEvaluate sales force

Compensate and motivatesales force

Compensate and motivatesales force

Recruit and trainsales force

Recruit and trainsales force

Determine sales force structure

Determine sales force structure

Define sales goals andsales process

Define sales goals andsales process

Tasks of Tasks of Sales ManagementSales Management

Tasks of Tasks of Sales ManagementSales Management

77

Page 44: Sales Promotion and  Personal Selling

44Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Defining Sales GoalsDefining Sales Goals

ClearClear

PrecisePrecise

MeasurableMeasurable

Time SpecificTime Specific

Sales GoalsShould Be...Sales GoalsShould Be...

77

Page 45: Sales Promotion and  Personal Selling

45Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

QuotaQuota

A statement of the

individual salesperson’s

sales objectives, usually

based on sales volume

alone but sometimes

including key accounts.

77

Page 46: Sales Promotion and  Personal Selling

46Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Sales Force StructureSales Force Structure

CommonCommonSalesSales

OrganizationOrganizationStructuresStructures

CommonCommonSalesSales

OrganizationOrganizationStructuresStructures

Individual client or account

Individual client or account

Market or IndustryMarket or Industry

Marketing FunctionMarketing Function

Product LineProduct Line

Geographic RegionGeographic Region

77

Page 47: Sales Promotion and  Personal Selling

47Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Training the Sales ForceTraining the Sales Force

Training Training includes...includes...

Training Training includes...includes...

Nonselling dutiesNonselling duties

Industry and customer characteristics

Industry and customer characteristics

Product knowledgeProduct knowledge

Selling techniquesSelling techniques

Company policies and practice

Company policies and practice

77

Page 48: Sales Promotion and  Personal Selling

48Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Compensation Plans: Compensation Plans: Basic MethodsBasic Methods

CommissionCommission

SalarySalary

CombinationPlans

CombinationPlans

77

On Linehttp://www.marykay.com

On Linehttp://www.marykay.com

Page 49: Sales Promotion and  Personal Selling

49Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Compensation PlansCompensation Plans

StraightCommission

StraightCommission

StraightSalary

StraightSalary

The salesperson is paid some percentage when a sale is made.The salesperson is paid some percentage when a sale is made.

The salesperson receives a salary regardless of sales

productivity.

The salesperson receives a salary regardless of sales

productivity.

77

Page 50: Sales Promotion and  Personal Selling

50Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Effective Sales LeadersEffective Sales Leaders

Effective Sales LeadersEffective Sales Leaders......Effective Sales LeadersEffective Sales Leaders......

Are assertive Are assertive

Possess ego drivePossess ego drive

Possess ego strengthPossess ego strength

Take risksTake risks

Are innovativeAre innovative

Have a sense of urgencyHave a sense of urgency

Are empatheticAre empathetic

77

Page 51: Sales Promotion and  Personal Selling

51Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

Evaluating the Sales Force: Evaluating the Sales Force: Performance MeasuresPerformance Measures

Contribution to ProfitContribution to Profit

Calls per OrderCalls per Order

Sales or Profits per CallSales or Profits per Call

Call Percentage Achieving GoalsCall Percentage Achieving Goals

Sales VolumeSales Volume

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Page 52: Sales Promotion and  Personal Selling

52Chap. 16 Marketing 7e Lamb Hair McDaniel©2004 South-Western/Thomson Learning

The Impact of Technology The Impact of Technology on Personal Sellingon Personal Selling

Laptop computer linkLaptop computer link

Cell phonesCell phones

PagersPagers

Personal data assistantsPersonal data assistants

E-MailE-Mail

InternetInternet

Sales ForceSales ForceAutomationAutomationSales ForceSales ForceAutomationAutomation

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