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Sales, Distribution, and Customer Relationship
Management and Satisfying Customers
© 2007 The McGraw-Hill Companies, Inc., All Rights Reserved.
McGraw-Hill/IrwinIntroduction to Business
Chapter Eleven
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Chapter 11 Sales, Distribution, and Customer Relationship
Management and Satisfying Customers
1. Understand the relationship of marketing, distribution, sales, and personal selling.
2. Discuss the main distribution channels a company can use to reach customers and the factors that determine the choice of distribution channel.
3. Differentiate approaches to personal selling and explain why the nature of a company’s products determines the selling approach.
4. Outline the major issues and problems during each stage of the personal selling process.
5. Explain customer relationship management can improve the profitability of the sales and distribution process.
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Chapter 11 Sales, Distribution, and Customer Relationship
Management and Satisfying Customers
Distribution• Process of utilizing intermediaries• Wholesaler• Distributor/dealer• Retailer• Direct to customer
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Chapter 11 Sales, Distribution, and Customer Relationship
Management and Satisfying Customers
Distribution• Process to effectively and efficiently deliver the
product to the customer• Product is sold to intermediaries• In turn sell to next intermediary• Channel of distribution
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Chapter 11 Sales, Distribution, and Customer Relationship
Management and Satisfying Customers
Sales• Activities locating customers• Persuading to buy a company’s product• Crucial sales activity is personal selling
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Chapter 11 Sales, Distribution, and Customer Relationship
Management and Satisfying Customers
Personal Selling • Direct face-to-face communication by salespersons
with existing and potential customers• Promotes a company’s products• Selling occurs at all levels of the channel of
distribution
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Chapter 11 Sales, Distribution, and Customer Relationship
Management and Satisfying Customers
Franchising• Contractual form of licensed distributor/dealer in the
channel of distribution
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Chapter 11 Sales, Distribution, and Customer Relationship
Management and Satisfying Customers
Channel of Distribution• Wholesaler intermediary buys product from
manufacturers and then resell to retailers who resell to final customers
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Chapter 11 Sales, Distribution, and Customer Relationship
Management and Satisfying Customers
Retailers• Intermediaries who sell other companies’ products to
final customers
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Chapter 11 Sales, Distribution, and Customer Relationship
Management and Satisfying Customers
Distribution Mix• Combination of channels selected to deliver products
to customers
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Chapter 11 Sales, Distribution, and Customer Relationship
Management and Satisfying Customers
Distribution Mix -- Criteria • Selecting the channels to distribute• Characteristics of its products• Need to customize its products• Significance of the purchase to customer
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Chapter 11 Sales, Distribution, and Customer Relationship
Management and Satisfying Customers
Distribution Mix -- Criteria• Product characteristics may be either simple or
complex• Product qualities challenge customers evaluation• Getting close to customers may simplify the products
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Chapter 11 Sales, Distribution, and Customer Relationship
Management and Satisfying Customers
Distribution Mix -- Criteria• Distribution mix determines level of pre-sale service • Distribution mix determines the opportunity to
provide a high level of post sale service• Dealers or a national sales force?
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Chapter 11 Sales, Distribution, and Customer Relationship
Management and Satisfying Customers
Distribution Mix -- Criteria
• Complex, customized, and costly products can capture a competitive advantage by choosing a distribution mix that has intermediaries and direct selling as the main channel
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Chapter 11 Sales, Distribution, and Customer Relationship
Management and Satisfying Customers
Distribution Mix -- Criteria• Sales and personal selling are a vital part of the
promotional activities in distribution channels
• To reach and deliver products to customers efficiently and effectively
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Chapter 11 Sales, Distribution, and Customer Relationship
Management and Satisfying Customers
Distribution Mix -- Criteria• Wholesalers and Retailers choose to stock Which
drugs doctors decide to prescribe • Both depend on promotional activity• A salespersons ability to persuade customers their
company’s product is the best choice
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Chapter 11 Sales, Distribution, and Customer Relationship
Management and Satisfying Customers
Technical Selling • Process of using detailed product- specific knowledge
to align the product with a customer’s needs• Especially important when a company’s products are
state of the art or must be customized to suit the needs of specific customers
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Chapter 11 Sales, Distribution, and Customer Relationship
Management and Satisfying Customers
Trade Selling • Managing the sale of one company’s products to other
companies. these companies may be intermediaries, such as wholesalers and retailers; or companies will include this product in their own product
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Chapter 11 Sales, Distribution, and Customer Relationship
Management and Satisfying Customers
Retailing • Selling to the final consumer • Provide customers with the product information • Keep the product in stock• Process customers orders correctly• Packaging/delivery of product
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Chapter 11 Sales, Distribution, and Customer Relationship
Management and Satisfying Customers
Missionary Selling • Does not involve a salesperson attempting to
close a sale immediately• Salesperson educates customers• Builds goodwill• Performs promotional activities• Product sampling to encourage a purchase at a
later date
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Chapter 11 Sales, Distribution, and Customer Relationship
Management and Satisfying Customers
Creative Selling • Salespeople compile their technical knowledge and
personal selling skills to craft a sales message that convinces customers to buy a product
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Chapter 11 Sales, Distribution, and Customer Relationship
Management and Satisfying Customers
Telemarketing• An increasingly ineffective channel to sell
directly to the final customer• Customers often perceive it as obtrusive,
annoying method of personal selling• Some companies are going back to the past and
using door to door sales
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Chapter 11 Sales, Distribution, and Customer Relationship
Management and Satisfying Customers
Six Stages of Selling • Prospecting for customers• Making the initial contact • The sales presentation• Handling objections• Closing the sale• After sales service and follow-up/information
gathering
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Chapter 11 Sales, Distribution, and Customer Relationship
Management and Satisfying Customers
Buyer’s remorse• Customers’ believe after a sale they have made a poor
purchasing choice, and lowers their satisfaction • Focus on after-sale service and building customer
relationship to preclude any remorse
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Chapter 11 Sales, Distribution, and Customer Relationship
Management and Satisfying Customers
Customer Relationship Management• An IT based knowledge management system designed
to track customers changing demand for a product • To maximize responsiveness to customers. CRM
system consists of a marketing module, a sales and selling module, and an after-sales service and support module
