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Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 16
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CHAPTER
16
Sales Promotion and Personal Selling
Prepared byDeborah Baker
Texas Christian University
MarketingLamb, Hair, McDaniel
9
2Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 16
Learning Outcomes
Define and state the objectives of sales promotion
Discuss the most common forms of consumer sales promotion
List the most common forms of trade sales promotion
Describe personal selling
LOI
LO2
LO3
LO4
3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 16
Learning Outcomes
Discuss the key differences between relationship selling and traditional selling
List the steps in the selling process
Describe the functions of sales management
LO5
LO6
LO7
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Define and state the objectives of sales promotion
Sales PromotionLOI
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Sales Promotion
SalesPromotion
SalesPromotion
LOI
Marketing communication
activities, other than
advertising, personal selling,
and public relations, in
which a short-term incentive
motivates a purchase.
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LOI
Advertising
Sales Promotion
Reason to buy
Sales Promotion Incentive to buy
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LOI Sales Promotion
ConsumerSales
Promotion
ConsumerSales
Promotion
Trade Sales
Promotion
Trade Sales
Promotion
Consumer market
Marketing channel
Drive immediate purchaseInfluence behavior
Goal
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LOI
Type of BuyerType of Buyer
Loyal Customers
Competitor’sCustomers
Brand Switchers
Price Buyers
Desired ResultsDesired Results
•Reinforce behavior• Increase consumption•Change purchase timing
•Break loyalty•Persuade to switch
•Persuade to buy your brand more often
•Appeal with low prices
•Supply added value
Sales PromotionSales PromotionExamples Examples
•Loyalty marketing•Bonus packs
•Sampling•Sweepstakes, contests, premiums
•Price-lowering promotion
•Trade deals
•Coupons, price-offpackages, refunds
•Trade deals
Objectives of Sales Promotion
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REVIEW LEARNING OUTCOMEThe Objectives of Sales Promotion
LOI
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Discuss the most common forms of consumer
sales promotion
Tools for Consumer Sales PromotionLO2
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Coupons and RebatesCoupons and Rebates
PremiumsPremiums
Loyalty Marketing ProgramsLoyalty Marketing Programs
Contests & SweepstakesContests & Sweepstakes
SamplingSampling
Point-of-Purchase PromotionPoint-of-Purchase Promotion
Tools for Consumer Sales Promotion
12Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 16LO2
Tools for Consumer Sales Promotion
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 period.
A cash refund given for the purchase of a product during
a specific period.
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.
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LO2
LoyaltyMarketingProgram
LoyaltyMarketingProgram
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.
FrequentBuyer
Program
FrequentBuyer
Program
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 Consumer Sales Promotion
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LO2
ContestsContests Promotions that require skill or ability to compete for prizes.
Promotions that require skill or ability to compete for prizes.
SweepstakesSweepstakesPromotions that depend on chance or luck, with free participation.
Promotions that depend on chance or luck, with free participation.
Tools for Consumer Sales Promotion
Online
http://www.sweepstakesonline.com
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Tools for Consumer Sales Promotion
SamplingSamplingA 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.
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LO2
Direct mailDirect mail
Door-to-door deliveryDoor-to-door delivery
Packaging with another productPackaging with another product
Retail store demonstrationRetail store demonstration
Methods of Sampling
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Build traffic
Advertise the product
Induce impulse buying
Point-of-Purchase Promotion
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Chapter 16
Online Sales PromotionLO2
Free merchandise
Sweepstakes
Free shipping with purchases
Coupons
Effective Types of Online Sales PromotionEffective Types of Online Sales Promotion
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REVIEW LEARNING OUTCOMEConsumer Sales Promotion
LO2
Coupons and rebates
Premiums
Loyalty marketing programs
Contests
Sampling
P-O-P
Online
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List the most common forms of trade sales promotion
Tools for Trade Sales PromotionLO3
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Chapter 16
Trade Sales PromotionLO3
Trade AllowancesTrade Allowances
Push MoneyPush Money
TrainingTraining
Free MerchandiseFree Merchandise
Store DemonstrationStore Demonstration
Conventions & Trade ShowsConventions & Trade Shows
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LO3
TradeAllowance
TradeAllowance
A price reduction offered
by manufacturers to
intermediaries, such as
wholesalers and retailers.
Trade Allowance
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LO3
Push MoneyPush MoneyMoney offered to channel
intermediaries to
encourage them to “push”
products--that is, to
encourage other members
of the channel to sell the
products.
Push Money
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Benefits of Trade Promotions
Help manufacturers gain new distribution
Obtain wholesaler and retailer support forconsumer sales promotions
Build or reduce dealer inventories
Improve trade relations
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REVIEW LEARNING OUTCOMEForms of Trade Sales Promotion
LO3
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Describe personal selling
Personal SellingLO4
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LO4 Personal Selling
Personal Selling is more important if...
Customers are concentrated.
Customers are concentrated.
Product is technically complex.
Product is technically complex.
There are few customers.There are few customers.
Product is custom made.Product is custom made.
Product has a high value.Product has a high value.
Customers are geographically dispersed.
Customers are geographically dispersed.
Product is simple to understand.
Product is simple to understand.
There are many customers.There are many customers.
Product is standardized.Product is standardized.
Product has a low value.Product has a low value.
Advertising & Sales Promotion are more important if...
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REVIEW LEARNING OUTCOMEPersonal Selling
LO4
Detailed explanation or demonstration
Variable sales message
Directed to qualified prospects
Controllable adjustable selling costs
More effective than other promotion in obtaining sale and gaining customer satisfaction
PersonalSelling
Advantages
PersonalSelling
Advantages
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Discuss the key differences between relationship selling
and traditional selling
Relationship SellingLO5
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LO5
Relationship(Consultative)
Selling
Relationship(Consultative)
Selling
Relationship Selling
A sales practice that involves building, maintaining, and enhancing interactions with customers in order to develop long-term satisfaction through mutually beneficial partnerships.
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Traditional Selling and Relationship SellingLO5
Sell advice, assistance, counsel Sell products
TraditionalTraditionalPersonal SellingPersonal Selling
Focus on closing sales
Limited sales planning
Discuss product
Assess “product-specific” needs
“Lone wolf” approach
Pricing/product focus
Short-term sales follow-up
Focus on customer’s bottom line
Sales planning is top priority
Build problem-solving environment
Conduct discovery in scope of operations
Team approach
Profit impact and strategic benefit focus
Long-term sales follow-up
Relationship SellingRelationship Selling
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REVIEW LEARNING OUTCOME Relationship Selling vs. Traditional Selling
LO5
InitialSales
RepeatSales
SuccessiveSales
Traditional Sales
Relationship Sales
SalesIncreasesResultFromCreatingValue
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List the steps in the selling process
Steps in the Selling ProcessLO6
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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
Steps in the Selling Process
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LO6
Key Selling StepsTraditional
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
Time Spent in Key Steps of Selling Process
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LO6
AdvertisingAdvertising PublicityPublicity Direct Mail/TelemarketingDirect Mail/
Telemarketing
Cold CallingCold Calling Internet Web Site
Internet Web Site ReferralsReferrals
Trade Shows/Conventions
Trade Shows/ConventionsNetworkingNetworking Company
RecordsCompany Records
Generating Leads
Online
http://www.linkedin.comhttp://www.ryze.com
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Cold CallingCold Calling
LO6 Cold 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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Recognized needRecognized need
Buying powerBuying power
Receptivity andaccessibility
Receptivity andaccessibility
LO6 Qualifying Leads
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NeedsAssessment
NeedsAssessment
LO6 Needs Assessment
A determination of the
customer’s specific needs
and wants and the range of
options a customer has for
satisfying them.
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LO6
Product or serviceProduct or service
CustomersCustomers
CompetitionCompetition
IndustryIndustry
Salesperson must knoweverything
about...
Salesperson must knoweverything
about...
The Consultative Salesperson
Online
http://www.hoovers.comhttp://www.dnb.com
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Developing and Proposing Solutions
Sales ProposalSales Proposal
Sales PresentationSales Presentation
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LO6
Be well prepared
Use eye contact
Ask open-ended questions
Be poised
Use hand gestures and voice inflection
Focus on the customer needs
Incorporate visual elements
Know how to operate the A/V equipment
Make sure the equipment works
PRACTICE, PRACTICE, PRACTICE!
Powerful Presentations
43Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 16LO6
View objections as requests for information
Anticipate specific objections
Investigate the objection with the customer
Be aware of competitors’ products
Stay calm
Use the objection to close the sale
Handling Objections
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LO6 Closing the Sale
NegotiateNegotiate
Keep an open mindKeep an open mind
Look for customer signals
Look for customer signals
Tailor to each marketTailor to each market
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Biz Flix
Fam
ily M
an
45
LO6
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REVIEW LEARNING OUTCOMESteps in the Selling Process
LO6
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Describe the functions of sales management
Sales ManagementLO7
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LO7
Evaluate sales forceEvaluate sales force
Compensate and motivate sales forceCompensate and motivate sales force
Recruit and train sales forceRecruit and train sales force
Determine sales force structureDetermine sales force structure
Define sales goals and sales processDefine sales goals and sales process
Sales Management Responsibilities
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LO7
ClearClear
PrecisePrecise
MeasurableMeasurable
Time SpecificTime Specific
Defining Sales Goals
Sales VolumeMarket ShareProfit Level
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QuotaQuota
LO7
A statement of the individual salesperson’s
sales objectives, usually based on sales
volume alone but sometimes including key
accounts, new accounts, repeat sales, and
specific products.
Quota
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Chapter 16
Sales Force StructureLO7
Individual client or account
Individual client or account
Market or industryMarket or industry
Marketing functionMarketing function
Product lineProduct line
Geographic regionGeographic region
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Traits of Top Sales PerformersLO7
Strong, healthy self esteem
Can bounce back from rejection
Sense of urgency and competitiveness
Persuasive
Assertive
Sociable
Willing to take risks
Understand complex concepts
Creative in developing solutions
Possess empathy
53Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved Chapter 16
LO7
Training includes...
Training 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
Training the Sales Force
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LO7 Compensating the Sales Force
CommissionCommission
SalarySalary
CombinationPlans
CombinationPlans
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LO7
StraightCommission
StraightCommission
The salesperson is paid some percentage when a sale is made.
The salesperson is paid some percentage when a sale is made.
StraightSalary
StraightSalary
The salesperson receives a salary regardless of sales productivity.
The salesperson receives a salary regardless of sales productivity.
Compensating the Sales Force
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Motivating the Sales ForceLO7
Ceremonies Plaques Vacations Merchandise Pay raises Cash bonuses Stock options Tuition assistance Product discounts
Rewards and incentives include:
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Key Personality Traits of Sales LeadersLO7
Effective Sales Leaders are…
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
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Chapter 16
Evaluating the Sales ForceLO7
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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Women in Car SalesLO7
SOURCE: Jennifer Saranow, “Car Dealers Recruit Saleswomen at the Mall,”
Wall Street Journal, April 12, 2006, B1.
For its Florida and Texas dealerships, Asbury Automotive Group is actively recruiting saleswomen– at shopping malls.
11% of the automotive sales force is female. In contrast, 50% of retail-industry employees are women.
Women influence 81% of new auto purchases, and women may even be better at selling cars than men.
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LO7
The Impact of Technology on Personal Selling
Cell phonesCell phones
LaptopsLaptops
PagersPagers
E-MailE-Mail
Electronic organizersElectronic organizers
InternetInternet
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REVIEW LEARNING OUTCOME Functions of Sales Management
LO7