BUS 312 Exam #3

Designing Sales Force Strategy and Structure

A company often divides sales responsibilities. The decision is based on: + how many product lines + how many industries + the size of the sales force + the number of buyers. Territorial sales force structure Product sales force structure Customer sales force structure Outside Sales Force are salespeople who travel to call on customers in the field. Inside Sales Force are salespeople who conduct business from their offices via telephone, online and social media interactions, or visits from prospective buyers. Team Selling involves using teams of people from sales, marketing, engineering, finance, technical support, and even upper management to service large, complex accounts.

Promotion Decisions

Advertise: In newspapers and magazines and on radio and television Digitally: With customers using web sites, social media, mobile ads and apps, and e-mail. PR Activities: Include special events, newsletters and blogs, store magazines, and public service activities. Salespeople: Greet customers, meet their needs, and build relationships. Sales Promotion: Include in-store sales loyalty program.

Native Advertising

Advertising that looks like the other natural content surrounding it on a web or social media platforms. + Twitter's promoted tweets, Facebooks promoted stories, BuzzFeed's sponsored posts, or Snapchat's "brand story" ads.

Wholesaling

Firms engaged primarily in wholesaling activities. + Wholesalers buy mostly from producers and sell mostly to retailers, industrial consumers, and other wholesalers. + Many of the nations largest and most important wholesalers are largely unknown to final consumers.

AIDA Model

Having defined the desired audience response, the communicator then turns to developing an effective message. Attention => Interest => Desire => Action

Public Relations

Involves building good relations with the company's various publics by building up a good corporate image and handling unfavorable rumors, stories, and events.

Direct and Digital Marketing

Involves engaging directly with carefully targeted individual consumers and customer communities to obtain an immediate response and build lasting customer relationships. + Direct mail + Catalogs +Online and social media + Mobile marketing

Message Content: Rational Emotional Moral

Rational Appeal - Relates to the audience's self interest Emotional Appeal - An attempt to stir up positive or negative emotions to motivate purchase Moral Appeal - Directed to an audience's sense of what is right and proper.

Madison and Vine

Represents the merging of advertising and entertainment [Ads that look like short films]

Relative Price Characteristics

Retailers can also be classified according to the prices they charge. A Discount Store sells standard merchandise at lower prices by accepting lower margins and selling higher volume. [Target, Kmart, or Walmart] Off-Price Retailers buy at less-than-regular wholesale prices and charge consumers less than retail. Three Main Types: + Independent Off-Price Retailers either are independently owned and run or are divisions of larger retail corporations. [TJ Maxx and Marshalls] + Factory Outlets manufacturer-owned and operated stores by firms such as J. Crew, Gap, Levi Strauss. and others + Warehouse Clubs (membership warehouses) operate in huge warehouse-like facilities and offer ultra-low prices and surprise deals on selected branded merchandise.

Types of Retailers

Retailers can be classified in terms of several characteristics: BATH Breadth and depth of their product lines Amount of Service they offer The relative price they charge How are they organized

Major Sales Promotion Tools

Samples: Offer a trial amount of a product Coupons: Are certificates that give buyers a saving when they purchase specified products Rebates: Are similar to coupons except that the price reduction occurs after the purchase Price Packs: Offer consumers savings off the regular price of a product. + Single packages sold a Contests, Sweepstakes, and Games: Event Marketing or Event Sponsorship: Is creating a brand-marketing event or serving as a sponsor of events created by others.

Amount of Service

Self-Service Retailers: Serve customers who perform their own locate-compare-select process to save money. Limited Service Retailers: Provide more sales assistance because they carry more shopping goods about which customers need more information. Full-Service Retailers: Assist customers in every phase of the shopping process, resulting in higher costs and, thus, higher prices.

Wholesaling includes ...

Selling and Promoting: + Wholesalers sales forces help manufacturers reach many customers at a low cost. + The wholesaler has more contacts and is often more trusted by the buyer than the distant manufacturer. Buying and Assortment Building: + Wholesalers can select items and build assortments needed by their customers, thereby saving much work. Bulk Breaking: + Wholesalers save their customers money by buying in carload lots and breaking bulk (breaking large lots into small quantities). Transportation: + Wholesalers can provide quicker delivery to buyers because they are closer to buyers than are producers. Financing: + Wholesalers finance their customers by giving credit, and they finance their suppliers by ordering early and paying bills on time. Risk Bearing: + Wholesalers absorb risk by bearing the cost of theft, damage, spoilage, and obsolescence. Market Information: + Wholesalers give information to suppliers and customers about competitors, new products, and price development. Management Services and Advice: + Wholesalers often help retailers train their salesclerks, improve store layouts and displays, and set up accounting and inventory control systems.

Communication Process

Sender => Encoding => Message (Media) => Decoding => Receiver => Response => Feedback => Sender. Noise affecting all these.

Sales Promotion

Short-term incentives to encourage purchases or sales of a product or service now. + Final Buyers (Consumer Promotions) + Retailers and Wholesalers (Trade Promotions) + Business Customers (Business Promotions) + Members of the Sales Force (Sales Force Promotions)

Product Sales Force Structure

When a company has numerous and complex products, the sales force often specializes along product lines: + Improves product knowledge

Buyer Readiness Stages

Awareness => Knowledge => Liking => Preference => Conviction => Purchase

Recruiting and Selecting Salespeople

Careful selection and training increases sales performance. Poor selection increases recruiting and training costs + Leads to lost sales and disrupts customer relationships. Many companies give formal tests to measure sales aptitude, analytical and organizational skills, personality traits, and other characteristics.

Public Relations

Consists of activities designed to build good relations with the company's various publics. + Press Relations: Involves the creation and placing newsworthy information to attract attention to a product or service. => Product Publicity involves publicizing specific products => Public Affairs involves building and maintaining national or local community relations + Lobbying: Involves building/maintaining relations with government officials to influence legislation and regulation. + Investor Relations: Involves maintaining relationships with shareholders and others in the financial community. + Development: Involves public relations donors or members of nonprofit organizations to gain financial or volunteer support.

Marketers can choose from two basic promotion mix strategies - push promotion or pull promotion. Compare and contrast these two strategies.

Consists of advertising, public relations, personal selling, sales promotion, and direct marketing tools. + Company uses these tools to engage consumers, persuasively communicate customer value, and build customer relationships. Advertising: Any paid form of presentation and promotion of ideas, goods, or services by an identified sponsor Sales Promotion: A short-term incentive to encourage the purchase of a product or service Personal Selling: Is the personal interaction by the firms sales force for the purpose of engaging customers. Public Relations: Involves building good relations with the company's various publics by building up a good corporate image. Direct and Digital Marketing: Involves engaging directly with carefully targeted individual consumers and customer communities to obtain an immediate response and build lasting customer relationships.

Promotion Mix Strategies

Consists of advertising, public relations, personal selling, sales promotion, and direct marketing tools. Company uses these tools to engage consumers, persuasively communicate customer value, and build customer relationships.

Direct Marketing Tools

Direct and Digital Marketing: Involves engaging directly with carefully targeted individual consumers and customer communities to obtain an immediate response and build lasting customer relationships. + Direct Mail + Catalogs + Online and Social Media + Mobile Marketing

Territorial Sales Force Structure

Each salesperson is assigned an exclusive geographic area and sells the company's products and services to all customers in that territory. + Defines salesperson's job + Fixes accountability + Improves relationship building and selling effectiveness + Lowers sales expenses

Customer Sales Force Structure

Each salesperson sells along customer type or industry: + Improves customer relationships + Many companies even have special sales forces to handle the needs of individual large customers.

Digital Marketing

Involves engaging directly with carefully targeted individual consumers and customer communities to obtain an immediate response and build lasting relationships. Fastest-growing form of marketing. Benefits: + Buyers: Convenience, Interactive, ready access to many products, and access to comparative information about companies, products and competitors. + Sellers: Effective tool to build customer relationships, low-cost, efficient, fast alternative to reach markets, flexible, and access to buyers not reachable through other channels.

Sales Promotion

Is a short-term incentive to encourage the purchase of a product or service. + Discounts + Coupons + Displays + Demonstrations

Advertising

Is any paid form of presentation and promotion of ideas, goods, or services by an identified sponsor. + Broadcast + Print + Online + Mobile + Outdoor

Sales Force Management Steps

Is the analysis, planning, implementation, and control of sales force activities. Designing Sales Force Strategy and Structure => Recruiting and Selecting Sales People => Training Sales People => Compensating Sales People => Supervising Sales People => Evaluating Sales People.

Personal Selling

Is the personal interaction by the firm's sales force for the purpose of ... + Engaging customers, making sales, and building customer relationships. The interpersonal part of the promotion mix and can include: + Face-to-face communication + Telephone communication + Video or Web conferencing

Personal Selling

Is the personal interaction by the firm's sales force for the purpose of engaging customers, making sales, and building customer relationships.

Supervising and Motivating Salespeople

Management can boost sales force morale and performance through . . . . Organizing Climate - feelings that salespeople have about their opportunities, value, and rewards for a good performance. Sales Quotas - standards regarding the amount they should sell. Positive Incentives - increase the sales force effort. + Sales Meetings + Sales Contests + Honors, merchandise and cash awards, trips, and profit-sharing plans.

Evaluating Sales Force for Performance

Management gets information about its salespeople in several ways . . . Sales Report, including weekly or monthly work plans. + Salespeople also write up their completed activities on call reports and turn in expense reports .+ The company can also monitor the sales and profit performance data in the salesperson's territory. + Additional information comes from personal observation, customer surveys, etc.

Three Types of Wholesalers

Merchant Wholesalers Brokers and Agents Manufacturers' and retailers' branches and offices

Types of Wholesalers

Merchant Wholesalers: Are the largest group of wholesalers and include: + They buy, take title, store, and handle products in large quantities and resell the products in smaller quantities to retailers. + Full-service: Wholesalers that provide a full set of services + Limited Services: Wholesalers that provide few services and specialized functions Brokers and Agents: Specialize by product line or customer type. Manufacturers' and Retailers' Branches and Offices: Are a form of wholesaling by sellers, rather than through independent wholesalers. + Sales Branches and offices are set up by manufacturers to improve inventory control, selling, and promotion. + Sales branches carry inventory and are found in industries such as lumber and automative equipment/parts. + Purchasing offices will perform a role similar to that of brokers or agents.

Training Salespeople

New salespeople may spend anywhere from a few weeks to a year in training. + Goals of training + Customer knowledge + Selling process + Knowledge of products, company, and competitors

Major Public Relations Tools

News Speeches Special Events Written Materials [Brochures] Corporate Identity Materials [Logos] Public Service Activities Buzz Marketing Social Networking Internet

Public relations specialists use several tools. Identify three of these tools and describe how they can help a company communicate with the public.

News, Speeches, Special Events, Written Materials, Corporate identity materials, public service activities, Buzz marketing, Social Networking, Internet. + Buzz Marketing: Involves cultivating opinion leaders and getting them to spread information about a product or service to others in their communities ("word-of-mouth").

Advertising Program

Objectives Setting: + Communication objectives + Sales objectives Budget Decisions: + Affordable approach + Percent of sales + Competitive parity + Objective and task Message Decisions: + Message strategy + Message execution Media Decisions: + Impact and engagement + Major media types + Specific media vehicles + Media Timing Advertising Evaluation + Communication impact + Sales and profit impact + Return on advertising

Communication Channels

Personal Communication - involves two or more people communicating directly with each other. + Face to face, Phone, Mail or e-mail, Texting or Internet chat Opinion Leaders - Are people (Influencers) whose opinions are sought by others. Buzz Marketing - Involves cultivating opinion leaders and getting them to spread information about a product or service to others in their communities ("word-of-mouth"). Non personal Communication: Major Media - Include print media, broadcast media, display media, and online media. Atmospheres - Are designed environments that create or reinforce the buyer's leanings toward buying a product. Events - Are staged occurrences that communicate messages to target audiences.

Identify and describe the different types of retailers, based on their product lines. Provide an example of each type of retailer

Specialty Stores: carry narrow product lines with deep assortments within those lines + Shoe stores and LIDS Department Stores: Carry a wide variety of product lines. They have been squeezed between specialty stores and lower-priced discounters. In response, many have added promotional pricing to meet the discount threat. Others have stepped up the use of store brands to compete with specialty stores. Some are trying catalog, telephone, and online selling. Supermarkets: Are the most frequently visited type of retail store. + They are facing competition from discounters (Walmart and Costco) + Specialty food stores (Whole Foods Market). Convenience Stores: Are small stores that carry a limited line of high-turnover convenience goods. Superstores: Are much larger than regular supermarkets and offer a large assortment of routinely purchased food products, nonfood items, and services + Walmart and Target offer super centers, very large combination food and discount stores. Category Killers: Are stores the size of airplane hangars that carry a very deep assortment of a particular line. + Best Buy, Home Depot, and PetSmart Service Retailers: Include hotels, banks, airlines, restaurants, colleges, hospitals, movie theaters, hair salons, and dry cleaners. Growing faster than product retailers in the U.S.

Media Types

Television: + Advantages: Good mass-marketing coverage; low cost per exposure; combines sight, sound, and motion; appealing to the senses. + Limitations: High absolute costs; high clutter; fleeting exposure; less audience selectively. Digital, mobile, and social media: + Advantages: High selectively; low cost; immediacy; engagement; capabilities. + Limitations: Potentially low impact; high audience control of content of exposure Newspapers: + Advantages: Flexibility; timeliness; good local market coverage; broad acceptability; high believability. + Limitations: Short life; poor reproduction quality; small pass along audience. Direct Mail: + Advantages: High audience selectivity; flexibility; no ad competitions within the same medium; allows personalization + Limitations: Relatively high cost per exposure; "junk mail" image Magazines: + Advantages: High geographic and demographic selectivity credibility and prestige; high-quality reproduction; long life and good pass-along readership + Limitations: Long ad purchase lead time; high cost; no guarantee of position Radio: + Advantages: Good local acceptance; high geographic and demographic selectivity; low cost + Limitations: Audio only; fleeting exposure; low attention ("the half-heard" medium); fragmented audiences Outdoor: + Advantages: Flexibility; high repeat exposure; low cost; low message competition; good positional selectivity + Limitations: Little audience selectivity; creative limitations

Retailer Marketing Decisions

The assortments and services of various retailers and looking more alike. Many departments stores have trimmed their services, whereas discounters have increased theirs. Customers have become smarter and more price sensitive.

Personal Selling Process

The selling process consists of several steps. These steps focus on the goal of getting new customers and obtaining orders from them. Prospecting: Identifies qualified potential customers through referrals from: + Customers, suppliers, dealers, internet Qualifying: Involves identifying good customers and screening out poor ones by looking at - + Financial ability, volume of business, needs, location, growth potential PreApproach: Is the process of learning as much as possible about a prospect. + Including needs, who is involved in the buying, and the characteristics and styles of the buyers. + The salesperson must apply the research gathered to develop a customer strategy. Approach: The process where the salesperson meets and greets the buyer Presentation: When the salesperson tells the product story to the buyer, presenting customer benefits and showing how the product solves the customers problems. Handling Objections: Is the process where salespeople resolves problems. + When handling objections from buyers, salespeople should: be positive, seek out hidden objections, ask the buyer to clarify any objections, take objections as opportunities to provide more information, and turn objections into reasons for buying Closing: The process where salespeople should recognize signals from the buyer - including physical actions, comments, and questions - to ask for a order and finalize the sale. Follow-Up: Is the last step in which the salesperson follows up after the sale to ensure customer satisfaction and repeat business.

Compensating Salespeople

To attract good salespeople, a company must have an appealing compensation plan. + Fixed Amount, usually a salary, gives the salesperson some stable income. + Variable Amount, which might be commissions or bonuses based on sales performance.