chapter 16 personal selling and sales...
TRANSCRIPT
Copyright©2014 Pearson Education
Chapter 16
PERSONAL SELLING AND SALES PROMOTION
MARKETING STARTER: CHAPTER 16 IBM: A Classic Model for Modern Customer-Focused Selling
Synopsis
Building upon nearly a century of successful product innovation and ―solutions selling,‖ IBM has grown into a $107
billion company. Since 1915, what IBM sells has changed dramatically. But what hasn’t changed is how IBM sells.
IBM salespeople have always been customer relationship developers and solutions providers. Consider Vivek
Gupta, who became IBM’s top salesperson in its fastest-growing industry (telecommunications) and fastest-growing
market (India). When Gupta first joined IBM in 2003, he launched his own extensive investigative effort, getting to
know people, learning about IBM and its customers, and developing a rock-solid knowledge of how the company’s
products and services fit customer needs. Gupta thrives on rooting out customer problems to solve. ―You have to
understand (customers’) pain points,‖ he explains. ―And they are not going to spell them out.‖ Fueled by keen
insights and hard work, Gupta has broken into a number of lucrative new markets for ―Big Blue.‖ IBM’s culture has
always dictated that its salespeople be ―part teacher, part psychologist, and part glad-hander,‖ observes one IBM
watcher. But Gupta’s success demonstrates that to be really good in sales today, they also must be ―part diplomat,
part entrepreneur, and part inventor‖—complete customer problem solvers. Thus, over the past 100 years, many
things have changed as IBM has adapted to the turbulent technological environment. But one thing has remained
constant—IBM salespeople are still inspired by founder Thomas J. Watson’s principles of selling.
Discussion Objective
A brief and focused 10- to 15-minute discussion of IBM’s ―solutions selling‖ approach will give students a clearer
understanding of modern, customer-centered sales. The discussion should also extinguish any lingering,
stereotypical perceptions of salespeople as pushy glad-handers. IBM salespeople are well-educated, well-trained
professionals who succeed by partnering with corporate customers and solving their problems for mutual gain.
Starting the Discussion
After a brief discussion to highlight the differences between ―standard selling‖ and IBM’s ―solutions selling,‖ go
online at http://www-01.ibm.com/software/commerce/selling-solutions/ to give students a glimpse into the
collaborative, professional nature of personal selling at IBM. In fact, it might even significantly boost the number of
students interested in learning more about sales careers with organizations such as IBM. Move along quickly guided
by the following questions.
Discussion Questions
1. What is the history of IBM’s solutions-oriented sales approach? Where does it find its roots? (Founder
Thomas J. Watson hired only top-performing graduates from Ivy League universities, and he insisted that
they wear conservative suits and white dress shirts. He demanded the highest ethical standards. IBM
provided intensive sales training that focused on developing a deep knowledge of the company and its
customers. Above all, Watson stressed, ―be a good listener, observe, study through observation.‖ This
advice became the foundation of what the company later came to call ―solutions selling.‖)
2. Describe IBM’s corporate culture and how it supports a successful customer-focused sales force. (IBM’s
customer-focused sales force has been the model for modern personal selling for nearly a century. IBM
salespeople have always been customer relationship developers and solutions providers. The company’s
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culture has always dictated that its salespeople be ―part teacher, part psychologist, and part glad-hander.‖
However, to be really good in sales today, salespeople also must be ―part diplomat, part entrepreneur, and
part inventor‖—complete customer problem solvers.)
3. How does the IBM story relate to the concepts in Chapter 16 on personal selling? (When it comes to almost
any aspect of managing a sales force, IBM sets the gold standard. It’s a great example of the role sales
forces play in creating and managing customer relationships. Keep the IBM ―solutions selling‖ example in
hand as you discuss various aspects of designing and managing a sales force.)
CHAPTER OVERVIEW Use Power Point Slide 16-1 here
This chapter concentrates on two more IMC elements—personal selling and sales promotion.
Personal selling is the interpersonal arm of marketing communications, in which the sales force
interacts with customers and prospects to build relationships and make sales.
Sales promotion consists of short-term incentives to encourage purchase or sale of a product or
service.
Although this chapter examines personal selling and sales promotion as separate tools, they must
be carefully integrated with other elements of the promotion mix.
CHAPTER OBJECTIVES Use Power Point Slide 16-2 here
1. Discuss the role of a company’s salespeople in creating value for customers and building
customer relationships.
2. Identify and explain the six major sales force management steps.
3. Discuss the personal selling process, distinguishing between transaction-oriented
marketing and relationship marketing.
4. Explain how sales promotion campaigns are developed and implemented.
CHAPTER OUTLINE
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INTRODUCTION
Building upon nearly a century of successful product
innovation and ―solutions selling,‖ IBM has grown into a
$107 billion company.
Since 1915, what IBM sells has changed dramatically. But
what hasn’t changed is how IBM sells. IBM salespeople
have always been customer relationship developers and
solutions providers. IBM’s culture has always dictated that
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Ad: IBM
Copyright©2014 Pearson Education
its salespeople be ―part teacher, part psychologist, and part
glad-hander.
However, to be really good in sales today, they also must be
―part diplomat, part entrepreneur, and part inventor‖—
complete customer problem solvers.
Thus, over the past 100 years, many things have changed as
IBM has adapted to the turbulent technological
environment. But one thing has remained constant—IBM
salespeople are still inspired by founder Thomas J.
Watson’s principles of selling.
Assignments, Resources
Use Web Resources 1 and 2 here
Opening Vignette Questions
1. How would you describe the ―solutions selling‖
sales culture at IBM?
2. At its heart, what is fundamentally different
about IBM’s approach compared to competitors?
What makes it work better for customers?
3. In your own words, explain how IBM’s Vivek
Gupta succeeded in India where competitors
may have failed.
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PERSONAL SELLING
Robert Louis Stevenson once noted ―everyone lives by
selling something.‖
The Nature of Personal Selling
Personal selling is one of the oldest professions in the
world.
The people who do the selling go by many names:
salespeople, sales representatives, district managers,
account executives, sales consultants, sales engineers,
agents, and account development reps to name just a few.
The term salesperson covers a wide range of positions.
At one extreme, a salesperson might be an order taker, such
as the department store salesperson standing behind the
counter.
At the other extreme are order getters, whose positions
demand creative selling and relationship building for
Chapter Objective 1
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Key Term: Personal
Selling
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Photo: Boeing
Copyright©2014 Pearson Education
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products and services ranging from appliances to industrial
equipment.
The Role of the Sales Force
Personal selling is the interpersonal arm of the promotion
mix.
The role of personal selling varies from company to
company.
Some firms have no salespeople at all—for example,
companies that sell only online or through catalogs, or
companies that sell through manufacturer’s reps, sales
agents, or brokers. In most firms, however, the sales force
plays a major role.
Linking the Company with Its Customers
The sales force serves as a critical link between a company
and its customers.
They represent the company to customers.
They represent customers to the company.
Coordinating Marketing and Sales
A company can take several actions to help bring its
marketing and sales functions closer together.
It can increase communications between the two
groups by arranging joint meetings and by spelling
out when and with whom each group should
communicate.
The company can create joint assignments.
The company can create joint objectives and reward
systems for sales and marketing.
They can appoint marketing-sales liaisons—people
from marketing who ―live with the sales force‖ and
help to coordinate marketing and sales force
programs and efforts.
The firm can appoint a high-level marketing
executive who oversees both marketing and sales.
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Photo: Salesperson
Links to Customer
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Assignments, Resources
Use Discussion Question 1 here
Use Additional Project 1 here
Use Individual Assignment 1 here
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MANAGING THE SALES FORCE
Sales force management is defined as the analysis,
planning, implementation, and controlling of sales force
activities. (Figure 16.1)
Designing Sales Force Strategy and Structure
The Sales Force Structure
A company can divide sales responsibilities along any of
several lines.
Territorial Sales Force Structure: Each salesperson is
assigned to an exclusive geographic area and sells the
company’s full line of products or services to all customers
in that territory.
Characteristics:
The organization defines each salesperson’s job and
fixes accountability.
The organization increases the salesperson’s desire
to build local customer relationships.
Because each salesperson travels within a limited
geographic area, travel expenses are relatively
small.
Product Sales Force Structure: The sales force sells along
product lines.
This structure can lead to problems if a single large
customer buys many different company products.
Customer Sales Force Structure: The sales force is
organized along customer or industry lines.
Separate sales forces may be set up for different industries,
for serving current customers versus finding new ones, and
for major accounts versus regular accounts.
Chapter Objective 2
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Key Terms: Sales
Force Management,
Territorial Sales
Force Structure,
Product Sales Force
Structure, Customer
(or Market) Sales
Force Structure
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Figure 16.1: Major
Steps in Sales Force
Management
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Complex Sales Force Structures: A company often
combines several types of sales force structures when it
sells a wide variety of products to many types of customers
over a broad geographic area.
Sales Force Size
Sales force size may range in size from only a few
salespeople to tens of thousands. Sales people are one of the
company’s most productive and expensive assets.
Therefore, increases in the size of the sales force can
increase sales as well as costs.
Workload approach: A company first groups accounts into
different classes according to size, account status, or other
factors related to the amount of effort required to maintain
them. It then determines the number of salespeople needed
to call on each class of accounts the desired number of
times.
Other Sales Force Strategy and Structure Issues
Outside and Inside Sales Forces
Outside salespeople travel to call on customers in the field.
Inside salespeople conduct business from their offices via
telephone, the Internet, or visits from buyers.
Technical sales support people provide technical
information and answers to customers’ questions.
Sales assistants provide administrative backup for
outside salespeople.
Telemarketers and Internet sellers use the phone and
Internet to find new leads and qualify prospects or to
sell and service accounts directly.
Most companies now use team selling to service large,
complex accounts. Sales teams can unearth problems,
solutions, and sales opportunities that no individual
salesperson could.
Such teams might include experts from any area or level of
the selling firm—sales, marketing, technical and support
services, R&D, engineering, operations, finance, and others.
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Photo: Whirlpool
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Photo: Climax
Portable Machine
Tools
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Key Terms: Outside
Sales Force (Field
Sales Force), Inside
Sales Force
Copyright©2014 Pearson Education
In team selling situations, the salesperson shifts from
―soloist‖ to ―orchestrator.‖
Shortcomings of team selling:
1. Salespeople who are used to having customers all to
themselves may have trouble learning to work with
and trust others on a team.
2. Selling teams can confuse or overwhelm customers
who are used to working with only one salesperson.
3. Difficulties in evaluating individual contributions to
the team selling effort can create some sticky
compensation issues.
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Key Term: Team
Selling
Assignments, Resources
Use Real Marketing 16.1 here
Use Marketing by the Numbers here
Use Additional Project 2 here
Use Think-Pair-Share 1 here
Use Web Resource 3 here
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Recruiting and Selecting Salespeople
In a typical sales force, the top 30 percent of the salespeople
might bring in 60 percent of the sales.
The best salespeople possess four key talents:
1. Intrinsic motivation
2. Disciplined work style
3. The ability to close a sale
4. The ability to build relationships with customers
When recruiting, companies should analyze the sales job
itself and the characteristics of its most successful
salespeople to identify the traits needed by a successful
salesperson in their industry.
Sources of new potential hires:
The human resources department gets names from
current salespeople, using employment agencies,
placing classified ads, searching the Internet, and
working through college placement services.
Another source is to attract top salespeople from
other companies.
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Photo: Great
Salespeople
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Training Salespeople
Training programs have several goals.
1. The training program must teach them about
different types of customers and their needs, buying
motives, and buying habits.
2. It must teach them how to sell effectively and train
them in the basics of the selling process.
3. The training program teaches them about the
company’s objectives, organization, and chief
products and markets, and about the strategies of
major competitors.
Many companies are adding e-learning to their sales
training programs.
Most e-learning is Internet-based but many companies now
offer on-demand training via mobile devices.
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Ad: Rep Race
Assignments, Resources
Use Individual Assignment 2 here
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Compensating Salespeople
Compensation is made up of several elements—a fixed
amount, a variable amount, expenses, and fringe benefits.
Management must decide what mix of compensation
elements makes the most sense for each sales job.
Different combinations of fixed and variable compensation
give rise to four basic types of compensation plans:
1. Straight salary
2. Straight commission
3. Salary plus bonus
4. Salary plus commission
The average salesperson’s pay consists of about 67 percent
salary and 33 percent incentive pay.
Compensation should direct salespeople toward activities
that are consistent with overall sales force and marketing
objectives.
Copyright©2014 Pearson Education
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Supervising and Motivating Salespeople
The goal of supervision is to help salespeople ―work smart‖
by doing the right things in the right ways.
The goal of motivation is to encourage salespeople to ―work
hard‖ and energetically toward sales force goals.
Supervising Salespeople
Companies vary in how closely they supervise their
salespeople.
The annual call plan shows which customers and
prospects to call on and which activities to carry out.
The time-and-duty analysis shows the time the
salesperson spends selling, traveling, waiting, taking
breaks, and doing administrative chores. (Figure
16.2)
On average, active selling time accounts for only 11 percent
of total working time!
Sales force automation systems: Computerized, digitized
sales force operations that let salespeople work more
effectively anytime, anywhere.
Selling and the Internet
Perhaps the fastest-growing technology tool is the Internet.
Sales organizations around the world are now using the
Internet to support their personal selling efforts—not just
for selling but also for everything from training salespeople
to conducting sales meetings and servicing accounts.
Motivating Salespeople
Salespeople often need special encouragement to do their
best.
Organizational climate describes the feeling that
salespeople have about their opportunities, value, and
rewards for a good performance.
Sales Quotas are Standards stating the amount they should
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Figure 16.2: How
Salespeople Spend
Their Time
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Photo: SAP
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Photo: Cisco
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Copyright©2014 Pearson Education
sell and how sales should be divided among the company’s
products.
Compensation is often related to how well salespeople meet
their quotas.
Companies use various positive incentives to increase sales
force effort:
Sales meetings provide social occasions, breaks
from routine, chances to meet and talk with
―company brass,‖ and opportunities to air feelings
and to identify with a larger group.
Companies also sponsor sales contests to spur the
sales force to make a selling effort above what
would normally be expected.
Other incentives include honors, merchandise and
cash awards, trips, and profit-sharing plans.
Key Term: Sales
Quota
Assignments, Resources
Use Discussion Questions 2 and 3 here
Use Think-Pair-Share 2 here
Use Web Resource 4 here
Troubleshooting Tip The issues surrounding managing the sales force can
be difficult for some students. Individually, each of
the decisions a sales manager needs to make seem
reasonable enough, but bringing them all together to
actually plan how to develop and manage the sales
force appears complicated to most undergraduates.
These issues can be made simpler by going through
each of the concepts carefully and thoroughly. You
may also want to have students design their own
sales force for a product or service idea they have.
This will really drive home the concepts of how you
design the sales force, as well as all the management
processes.
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Evaluating Salespeople and Sales Force Performance
Management sources of salesperson information:
Sales reports
Call reports
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Expense reports
Formal evaluation forces management to develop and
communicate clear standards for judging performance and
provides salespeople with constructive feedback and
motivates them to perform well.
As with other marketing activities, the company wants to
measure its return on sales investment.
Troubleshooting Tip Sales to most students equate to retail sales, a field
that many people dislike. Therefore, many students
will not be planning on going into sales as a career,
and this could cause them to ―tune out‖ during this
section. You can bring them back by talking about
the nature of selling in various kinds of service firms
(e.g., accounting firms) that many students may be
heading toward after graduation. Also, a discussion
of the sophistication and professionalism of the
salespeople in companies such as IBM and other
business-to-business companies can generate some
enthusiasm for this important field.
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THE PERSONAL SELLING PROCESS
Steps in the Selling Process (Figure 16.3)
The selling process consists of seven steps:
1. Prospecting and qualifying
2. Preapproach
3. Approach
4. Presentation and demonstration
5. Handling objections
6. Closing
7. Follow-Up
Prospecting and Qualifying
Prospecting is identifying qualified potential customers.
The best source of prospects is referrals.
Sources of referrals:
Current customers
Chapter Objective 3
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Figure 16.3: Steps
in the Selling
Process
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Key Terms: Selling
Process,
Prospecting,
Qualifying
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Suppliers and dealers
Noncompeting sales-people
The Web or other social networks
Dropping in unannounced on various offices (a
practice known as “cold calling”)
Qualifying a lead is learning how to identify the good ones
and screen out the poor ones.
Prospects can be qualified by:
Their financial ability
Volume of business
Special needs
Location
Possibilities for growth
Preapproach
Preapproach is the stage in which the salesperson learns as
much as possible about the organization (what it needs, who
is involved in the buying) and its buyers (their
characteristics and buying styles).
Call objectives is the task of qualifying the prospect,
gathering information, or making an immediate sale.
Other call objectives include deciding on the best approach,
the best timing, and a determination of the overall sales
strategy for the account.
Approach
During the approach step, the salesperson should know
how to meet and greet the buyer and get the relationship off
to a good start.
Presentation and Demonstration
When presenting, the salesperson tells the ―value story‖ to
the buyer, showing how the company’s offer solves the
customer’s problems.
The customer-solution approach fits better with a
relationship marketing focus.
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Key Terms:
Preapproach,
Approach,
Presentation
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But before salespeople can present customer solutions, they
must develop solutions to present.
The qualities that buyers dislike most in salespeople include
being:
Pushy
Late
Deceitful
Unprepared or disorganized
Overly talkative
The qualities that buyers value most in salespeople include:
Good listening
Empathy
Honesty
Dependability
Thoroughness
Follow-through
Handling Objections
In handling objections, the salesperson should:
Use a positive approach
Seek out hidden objections
Ask the buyer to clarify any objections
Take objections as opportunities
Turn the objections into reasons for buying
Every salesperson needs training in the skills of handling
objections.
Closing
Salespeople can use one of several closing techniques:
Ask for the order
Review points of agreement
Offer to help write up the order
Ask whether the buyer wants this model or that one
Note that the buyer will lose out if the order is not
placed now
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Ad: Boise
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Key Terms:
Handling
Objections, Closing,
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Follow-Up
Follow-up is necessary if the salesperson wants to ensure
customer satisfaction and repeat business.
Follow-Up
Assignments, Resources
Use Additional Project 3 here
Use Think-Pair-Share 3 and 4 here
Use Outside Examples 1 and 2 here
Troubleshooting Tip The personal selling process will be a surprise to
many students, again because they typically think of
retail sales, if they’ve thought about sales at all. The
importance of all of these steps in the sales process
can be highlighted in the discussion of business-to-
business sales.
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Personal Selling and Managing Customer Relationships
Transaction orientation: The purpose is to help salespeople
close a specific sale with a customer.
Relationship orientation: The purpose is to serve the
customer over the long haul in a mutually profitable
relationship.
Today’s large customers favor suppliers who can sell and
deliver a coordinated set of products and services to many
locations, and who can work closely with customer teams to
improve products and processes.
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Photo: P&G
Assignments, Resources
Use Real Marketing 16.2 here
Use Video Case here
Use Small Group Project 1 here
Use Individual Assignment 2 here
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SALES PROMOTION
Sales promotion consists of short-term incentives to
encourage purchase or sale of a product or service now.
Rapid Growth of Sales Promotion
Sales promotion tools are targeted toward final buyers
(consumer promotions), retailers and wholesalers (trade
promotions), business customers (business promotions), and
Chapter Objective 4
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Key Term: Sales
Promotion
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Ad: Bed Bath &
Beyond
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members of the sales force (sales force promotions).
Today, in the average consumer packaged-goods company,
sales promotion accounts for 77 percent of all marketing
expenditures.
Several factors have contributed to the rapid growth of sales
promotion:
1. Product managers face greater pressures to increase
their current sales.
2. The company faces more competition and
competing brands are less differentiated.
3. Advertising efficiency has declined.
4. Consumers have become more deal oriented.
The growing use of sales promotion has resulted in
promotion clutter. Consumers are increasingly tuning out
promotions, weakening their ability to trigger immediate
purchase.
Sales Promotion Objectives
Sales promotion objectives vary widely.
Consumer promotions: Urge short-term customer
buying or to enhance customer brand involvement.
Trade promotions: Get retailers to carry new items
and more inventory, buy ahead, or promote the
company’s products and give them more shelf space.
Business promotions are used to generate business
leads, stimulate purchases, reward customers, and
motivate salespeople.
Sales force: Get more sales force support for current
or new products or getting salespeople to sign up
new accounts.
Sales promotions should help to reinforce the product’s
position and build long-term customer relationships.
Assignments, Resources
Use Discussing the Concepts 4 here
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Major Sales Promotion Tools
Many tools can be used to accomplish sales promotion
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objectives. Descriptions of the main consumer, trade, and
business promotion tools follow.
Consumer Promotions
Consumer promotions include a wide range of tools.
Samples are offers of a trial amount of a product.
Sampling is the most effective—but most expensive—way
to introduce a new product or to create new excitement for
an existing one.
Coupons are certificates that give buyers a savings when
they purchase specified products.
Most major consumer goods companies are issuing fewer
coupons and targeting them more carefully.
Rebates (or cash refunds are like coupons except that the
price reduction occurs after the purchase rather than at the
retail outlet.
Price packs (also called cents-off deals) offer consumers
savings off the regular price of a product.
Premiums are goods offered either free or at low cost as an
incentive to buy a product.
Advertising specialties, also called promotional products,
are useful articles imprinted with an advertiser’s name,
logo, or message that are given as gifts to consumers.
Point-of-purchase (POP) promotions include displays and
demonstrations that take place at the point of sale.
Contests, sweepstakes, and games give consumers the
chance to win something.
A contest calls for consumers to submit an entry to
be judged.
A sweepstakes calls for consumers to submit their
names for a drawing.
A game presents consumers with something every
Photo: Kroger
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Key Term:
Consumer
Promotions
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Ad: Walgreens
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time they buy.
Event marketing (or event sponsorships) allows companies
to create their own brand marketing events or serve as sole
or participating sponsors of events created by others.
Trade Promotions
Trade promotions persuade resellers to carry a brand, give
it shelf space, promote it in advertising, and push it to
consumers.
Manufacturers use several trade promotion tools:
A straight discount (also called a price-off, off-
invoice, or off-list)
An allowance (usually so much off per case)
Free goods
Push money
Free specialty advertising items
Business Promotions
Business promotions are used to generate business leads,
stimulate purchases, reward customers, and motivate
salespeople.
Conventions and trade shows: Firms selling to the industry
show their products at the trade show.
Vendors receive many benefits:
Opportunities to find new sales leads
Contact customers
Introduce new products
Meet new customers
Sell more to present customers
Educate customers with publications and audio-
visual materials
Reach many prospects not reached through their
sales forces
Sales contests: Contests for salespeople or dealers to
motivate them to increase their sales performance over a
given period.
Photo: Red Bull
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Key Term: Event
Marketing (Event
Sponsorship)
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Key Term: Trade
Promotions
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Key Term: Business
Promotions
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Photo: Trade Show
Copyright©2014 Pearson Education
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Developing the Sales Promotion Program
Marketers must decide:
1. Size of the incentive
2. Conditions for participation
3. Promotion and distribution
4. Length of the promotion
5. Evaluation
Assignments, Resources
Use Discussion Questions 4 and 5 here
Use Critical Thinking Exercise 3 here
Use Marketing Technology here
Use Marketing Ethics here
Use Additional Projects 4 and 5 here
Use Think-Pair-Share 5 here
Use Web Resource 5 here Use Company Case here
END OF CHAPTER MATERIAL
Discussion Questions
1. Discuss how the salesperson is a critical link between the company and the customer.
(AASCB: Communication; Reflective Thinking)
Answer:
Salespeople serve as a critical link between a company and its customers. First, they
represent the company to customers. They find and develop new customers and
communicate information about the company’s products and services. At the same time,
salespeople represent customers to the company, acting inside the firm as ―champions‖ of
customers’ interests and managing the buyer-seller relationship. Salespeople relay customer
concerns about company products and actions back inside to those who can handle them.
They learn about customer needs and work with other marketing and nonmarketing people in
the company to develop greater customer value.
In fact, to many customers, the salesperson is the company—the only tangible manifestation
of the company that they see. Hence, customers may become loyal to salespeople as well as
to the companies and products they represent. This concept of ―salesperson-owned loyalty‖
lends even more importance to the salesperson’s customer relationship building abilities.
Strong relationships with the salesperson will result in strong relationships with the company
and its products. Conversely, poor relationships will probably result in poor company and
Copyright©2014 Pearson Education
product relationships.
2. Compare the three sales force structures outlined in the chapter. Which structure is most
effective? (AACSB: Communication; Reflective Thinking)
Answer:
In the territorial sales force structure, each salesperson is assigned to an exclusive
geographic area and sells the company’s full line of products or services to all customers in
that territory. With a product sales force structure, the sales force sells along product
lines. More and more companies are now using a customer sales force structure, in
which they organize the sales force along customer or industry lines. Separate sales forces
may be set up for different industries, for serving current customers versus finding new ones,
and for major accounts versus regular accounts.
One structure is not necessarily better than the others. A company must develop one that is
appropriate for its needs. A good sales structure can mean the difference between success and
failure. Over time, sales force structures can grow complex, inefficient, and unresponsive to
customers’ needs. Companies should periodically review their sales force organizations to be
certain that they serve the needs of the company and its customers.
3. Discuss the activities involved in sales force management. (AACSB: Communication)
Answer:
Sales force management is the analysis, planning, implementation, and control of sales
force activities. It includes designing sales force strategy and structure and recruiting,
selecting, training, compensating, supervising, and evaluating the firm’s salespeople. These
major sales force management decisions are shown in Figure 16.1. Marketing managers face
several sales force strategy and design questions. How should salespeople and their tasks be
structured? How big should the sales force be? Should salespeople sell alone or work in
teams with other people in the company? Should they sell in the field or by telephone or on
the Internet? At the heart of any successful sales force operation is the recruitment and
selection of good salespeople who must be given proper training. To attract good
salespeople, a company must have an appealing compensation plan. Compensation is made
up of several elements—a fixed amount, a variable amount, expenses, and fringe benefits.
New salespeople need more than a territory, compensation, and training—they need
supervision and motivation. This process requires good feedback. And good feedback
means getting regular information, from sales reports, call reports, and expense reports, about
salespeople to evaluate their performance. The company can also monitor the sales and
profit performance data in the salesperson’s territory. Additional information comes from
personal observation, customer surveys, and talks with other salespeople.
4. Define sales promotion and discuss its objectives. (AACSB: Communication)
Answer:
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Sales promotion consists of short-term incentives to encourage purchase or sales of a
product or service and includes tools such as coupons, sweepstakes, premiums, and trade
allowances. Sales promotion objectives vary widely. Sellers may use consumer promotions
to urge short-term customer buying or to enhance customer brand involvement. Objectives
for trade promotions include getting retailers to carry new items and more inventory, buy
ahead, or promote the company’s products and give them more shelf space. For the sales
force, objectives include getting more sales force support for current or new products or
getting salespeople to sign up new accounts.
5. Name and describe the types of consumer promotions. (AACSB: Communication;
Reflective Thinking)
Answer:
Consumer promotions include a wide range of tools—from samples, coupons, refunds,
premiums, and point-of-purchase displays to contests, sweepstakes, and event sponsorships.
Samples are offers of a trial amount of a product. Coupons are certificates that give buyers a
saving when they purchase specified products. Cash refunds (or rebates) are like coupons
except that the price reduction occurs after the purchase rather than at the retail outlet. The
consumer sends a ―proof of purchase‖ to the manufacturer, who then refunds part of the
purchase price by mail. Price packs (also called cents-off deals) offer consumers savings off
the regular price of a product. The producer marks the reduced prices directly on the label or
package. Price packs can be single packages sold at a reduced price (such as two for the
price of one), or two related products banded together (such as a toothbrush and toothpaste).
Premiums are goods offered either free or at low cost as an incentive to buy a product. A
premium may come inside the package (in-pack), outside the package (on-pack), or through
the mail. Advertising specialties, also called promotional products, are useful articles
imprinted with an advertiser’s name, logo, or message that are given as gifts to consumers.
Typical items include T-shirts and other apparel, pens, coffee mugs, calendars, key rings,
mouse pads, matches, tote bags, coolers, golf balls, and caps. Point-of-purchase (POP)
promotions include displays and demonstrations that take place at the point of sale. Contests,
sweepstakes, and games give consumers the chance to win something, such as cash, trips, or
goods, by luck or through extra effort. A contest calls for consumers to submit an entry to be
judged by a panel that will select the best entries. A sweepstakes calls for consumers to
submit their names for a drawing. A game presents consumers with something every time
they buy, which may or may not help them win a prize. Finally, marketers can promote their
brands through event marketing (or event sponsorships). They can create their own brand
marketing events or serve as sole or participating sponsors of events created by others. The
events might include anything from mobile brand tours to festivals, reunions, marathons,
concerts, or other sponsored gatherings.
6. Discuss the different types of trade sales promotions and distinguish these types of
promotions from business promotions. (AACSB: Communication)
Answer:
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Trade promotions can persuade resellers to carry a brand, give it shelf space, promote it in
advertising, and push it to consumers. Shelf space is so scarce these days that manufacturers
often have to offer price-offs, allowances, buy-back guarantees, or free goods to retailers and
wholesalers to get products on the shelf and, once there, to keep them on it. Manufacturers
use several trade promotion tools. Many of the tools used for consumer promotions—
contests, premiums, displays—can also be used as trade promotions. Or the manufacturer
may offer a straight discount off the list price on each case purchased during a stated period
of time (also called a price-off, off-invoice, or off-list). Manufacturers also may offer an
allowance (usually so much off per case) in return for the retailer’s agreement to feature the
manufacturer’s products in some way. An advertising allowance compensates retailers for
advertising the product. A display allowance compensates them for using special displays.
Manufacturers may offer free goods, which are extra cases of merchandise, to resellers who
buy a certain quantity or who feature a certain flavor or size. They may offer push money—
cash or gifts to dealers or their sales forces to ―push‖ the manufacturer’s goods.
Manufacturers may give retailers free specialty advertising items that carry the company’s
name, such as pens, pencils, calendars, paperweights, matchbooks, memo pads, and
yardsticks.
Business promotions are used to generate business leads, stimulate purchases, reward
customers, and motivate salespeople. Business promotions include many of the same tools
used for consumer or trade promotions, but there are two additional major business
promotion tools—conventions and trade shows, and sales contests.
Critical Thinking Exercises
1. Suppose you are the marketing coordinator responsible for recommending a sales promotion
plan for the market launch of new brand of energy drink sold in supermarkets. What
promotional tools would you consider for this task and what decisions must be made?
(AACSB: Communications; Reflective Thinking)
Answer:
There is a long list of consumer promotional tools: samples, coupons, cash refunds, price
packs, premiums, advertising specialties, patronage rewards, point-of-purchase displays and
demonstrations, contests, sweepstakes, and games. The likely choices for an intensively
distributed consumer product are samples and point-of-purchase displays and
demonstrations. Samples are often used when introducing new products. POPs include POP
signs and demonstrations (samples) that take place at the point of sale. They can be useful in
breaking down resistance to new and different products. A coupon that provides an incentive
to buy the product is usually given at the POP site. Trade promotions should also be
considered including price-offs, allowances, buy-back guarantees, or free goods.
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Beyond selecting the types of promotions to use, marketers must make several other
decisions in designing the full sales promotion program. First, they must decide on the size
of the incentive. A certain minimum incentive is necessary if the promotion is to succeed; a
larger incentive will produce more sales response. The marketer also must set conditions for
participation. Incentives might be offered to everyone or only to select groups. Marketers
must decide how to promote and distribute the promotion program itself. A $2-off coupon
could be given out in a package, at the store, via the Internet, or in an advertisement. Each
distribution method involves a different level of reach and cost. Increasingly, marketers are
blending several media into a total campaign concept. The length of the promotion is also
important. If the sales promotion period is too short, many prospects (who may not be
buying during that time) will miss it. If the promotion runs too long, the deal will lose some
of its ―act now‖ force. Evaluation is also very important. The most common evaluation
method is to compare sales before, during, and after a promotion.
Marketing Technology: Another Day, Another Deal
The humble coupon has gotten a boost from social media. Groupon, the group deal-of-the-day
coupon service that started in late 2008, is exceeding even Google’s and Facebook’s phenomenal
early growth rates. It now offers about 1,000 deals every day to more than 70 million subscribers
in almost 50 countries. The business model is simple. A business sets up a deal through
Groupon, such as offering $50 worth of merchandise for $25, but the deal is only honored if
enough people sign up for it. Groupon typically takes a 50 percent cut of all the revenue
generated on the deal (that is, $12.50 of the $25 the consumer pays for the groupon). In return,
the business gets a lot of store traffic from the deal. Because the business model is so simple and
the entry barriers so small, there are now more than 600 of these digital daily-deal online sites.
1. Debate the pros and cons of offering coupons through digital deal-of-the-day Internet sites
such as Groupon from the perspective of businesses offering the deal. (AACSB:
Communication; Use of IT; Reflective Thinking)
Answer:
Students will be able to find ample information regarding how these types of sites operate
and the pros and cons for businesses using them. While some retailers report great success,
others point out that they only receive $12.50 on a $25-for-$50-worth-of- merchandise deal.
More importantly, most customers do not return and many businesses are overwhelmed by
the response and cannot fulfill the demand generated by the offer. Several useful articles are
listed below:
―Is Groupon a Good Business Deal?‖ Entrepreneur, (March 2011), p. 61.
―Sometimes Groupon Coupons Work Too Well,‖ Bloomberg Businessweek, (June 14, 2011),
p. 33-34.
Charlotte McEleny, ―Groupon Uses High Reach to Show Retailers It’s Better Than TV and
Copyright©2014 Pearson Education
Print,‖ New Media Age, (March 17, 2011), pp. 4-5.
Brent Burkey, ―Social Coupon Service Groupon Yields High Returns If Used Tactically,
Local Clients Said,‖ Central Penn Business Journal, (April 29, 2011), pp. 19-21.
―Have Your Drawn New Customers With Deals From Groupon or Living Social?‖ Bicycle
Retailer & Industry News, (July 1, 2011), p. 22.
Utpal Dholakia, ―Why Employees Can Wreck Promotional Offers,‖ Harvard Business
Review, (Jan/Feb 2011), p. 28.
Utpal Dholakia, ―How Businesses Fare With Daily Deals As They Gain Experience: A
Multi-Time Period Study of Daily Deal Performance,‖ available at http://news.rice.edu/wp-
content/uploads/2012/07/2012-07-05-DailyDeals.pdf.
2. Create an idea for a local group-buying promotional service based on Groupon’s model as a
class project or as a fundraiser for a student organization at your school. Students will be the
target market of this digital deal online site. Develop a sales plan to recruit local businesses
to offer deals as well as the promotion plan to attract students to the site. Present your plans
to the class. (AACSB: Communication; Reflective Thinking)
Answer:
Students’ answers will vary, but they should be expected to apply the steps in the selling
process for recruiting businesses to offer deals and for attracting students as customers.
Students should also be prepared to counter many of the ―cons‖ they discussed in the
previous question when developing their sales presentation.
Marketing Ethics: Off Label Marketing
Johnson & Johnson agreed to a $2.2 billion settlement over the marketing of its antipsychotic
drug, Risperdal. Pfizer agreed to a $2.3 billion settlement and Eli Lilly paid $1.4 billion to settle
disputes with the U.S. government. Glaxo recently agreed to a $3 million settlement—its fourth
settlement with the government over the marketing of its products. By law, pharmaceutical
companies are allowed to market their drugs only for uses approved by the Food and Drug
Administration, but doctors may prescribe any approved drug as they see fit. Drug
manufacturers have been training their sales forces to educate doctors on non-approved uses and
dosages, called ―off-label‖ marketing. Almost 75 percent of the largest pharmaceutical
settlements with the government are for off-label marketing. Glaxo even went so far as to have a
questionable article ghost-written by a company and later published in a medical journal under
the names of academic authors to convince doctors that Paxil was proven effective in treating
depression in children, a use that the FDA has not approved. The reported clinical trial was later
criticized by the medical community, but doctors probably are not aware of that because a
majority of them rely on pharmaceutical companies for information on drugs. Most unlawful
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practices by the pharmaceutical industry come to light only because an insider—someone in
management or a sales rep—blows the whistle. Fortunately, the Federal False Claim Act
provides protection and even incentive for employees to come forward. Pharmaceutical
companies settle these types of investigations because, even if they plead guilty to criminal
charges, which J&J and Glaxo did, they don’t lose the ability to sell drugs to the government as
they would if found guilty after a trial.
1. What would you do if you were a pharmaceutical sales rep and were told to promote a drug
for off-label use? What protections and incentives are available under the Federal False
Claim Act to encourage employees to report illegal behavior? (AACSB: Communication;
Ethical Reasoning; Reflective Thinking)
Answer:
Students’ answers will vary. Some useful sources are:
Description of off-label marketing:
http://www.whistleblowerfirm.com/pharmaceutical-fraud/off-label-marketing/
Study finding that doctors receive most drug information from pharmaceutical companies:
http://www.plosmedicine.org/article/info%3Adoi%2F10.1371%2Fjournal.pmed.1000431
List of the top 20 pharmaceutical settlements, 14 of which are the result of off-label
marketing:
http://en.wikipedia.org/wiki/List_of_Largest_Pharmaceutical_Settlements
Information on the False Claims Act:
http://www.whistleblowerlaws.com/false-claims-act/federal-false-claims-act/. This law was
enacted during the Civil War and is also referred to as the ―Lincoln Law.‖ Its intent is to
reduce the amount of fraud when selling to the government. Since pharmaceutical
companies sell to government programs such as Medicare, the law has been used to
prosecute companies. Under this act, whistleblowers are given the incentive of earning a
percentage of the government’s settlement.
2. What traits and behaviors should an ethical salesperson possess? What role does the sales
manager play in ethical selling behavior? (AACSB: Communication; Ethical Reasoning;
Reflective Thinking)
Answer:
The sales manager is important in selecting and training the salesforce. Thus, ensuring
individuals possess ethical traits is important in the hiring decision, but also training is
important to make salespeople aware of ethical behavior.
An interesting article discussing characteristics of an ethical sales person can be found at:
http://ewweb.com/mag/electric_sales_ethics/. This article discusses factors, such as trust,
Copyright©2014 Pearson Education
credibility, anticipate problems, set high standards from the beginning, avoid legalism, and
facing up to your mistakes.
National and international trade associations have defined codes of ethics. For example, the
pharmaceuticals industry, which is under fire from regulatory groups and others, has codes of
conduct regarding interactions with healthcare professionals. Visit the Web sites of the
Pharmaceutical Research and Manufacturers of America (PhRMA) (www.phrma.org) and
the International Federation of Pharmaceutical Manufacturers Association (IFPMA)
(http://ifpma.org/) to see their codes of ethics regarding sales activities. The IFPMA enacted
new codes that went into effect in 2007 but PhRMA has had a code in place for several years.
Pharmaceutical marketers are restricted through self-regulation to providing educational
activities and that meals must be reasonable. Thus, bringing lunch to the workers in doctors’
offices is fine as long as there is some educational component. Also, paying for trips to
educational seminars is still acceptable, but providing travel for guests, such as spouses, and
entertainment are not allowed. Companies violating the code will be publically named.
Marketing by the Numbers: Sales Force Analysis
Brown, Inc. is a manufacturer of furniture sold through retail furniture outlets in the southeastern
United States. The company has two salespeople that do more than just sell the products—they
manage relationships with retail customers to enable them to better meet consumers’ needs. The
company’s sales reps visit retail customers several times per year, often for hours at a time.
Brown is considering expanding to other regions of the country and would like to have
distribution through 1,000 retail customer accounts. To do so, however, the company would
have to hire more salespeople. Each salesperson earns $50,000 plus 2 percent commission on all
sales. Another alternative is to use the services of sales agents instead of its own salesforce.
Sales agents would be paid 10 percent of sales.
1. Refer to Appendix 2 to answer this question. Determine the number of salespeople Brown
needs if it has 1,000 retail customer accounts that need to be called on five times per year.
Each sales call lasts approximately 2.5 hours, and each sales rep has approximately 1,250
hours per year to devote to customers. (AACSB: Communication; Analytical Reasoning)
Answer:
The workload method uses the following formula to determine the sales force size:
NC FC LC
NS = ———————— TA
where,
NS = number of salespeople
NC = number of customers
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FC = average frequency of customer calls per customer
LC = average length of customer call
TA = time an average salesperson has available for selling per year
so,
1,000 5 2.5
NS = ——————— = 10 salespeople 1,250
2. At what level of sales would it be more cost efficient for Brown to use its own sales force
compared to sales agents? To determine this, consider the fixed and variable costs for each
alternative. What are the pros and cons of using a company’s own sales force over
independent sales agents? (AACSB: Communication; Analytical Reasoning; Reflective
Thinking)
Answer:
To determine the level of sales at which one alternative would be as efficient as the other, we
must set the costs equal to each other. Because variable costs are a function of sales, we can
solve for the sales level at which the two would be equal:
Total Costssalesforce = Total Costssales agents
Total costs consist of fixed costs and variable costs, so for the salesforce option, total costs
would equal the total salaries for the 10 salespeople (fixed costs) plus the commissions on
sales (variable costs). Total costs for the sales agent option are just variables costs.
Therefore:
Total costssalesforce = ($50,000 x 10 salespeople) + (0.02 x sales)
Total costssales agents = (0.10 x sales)
Set the two equations equal to each other and solve for sales:
Total Costssaleforce = Total Costssales agents
($50,000 x 10) + (0.02 x sales) = (0.10 x sales)
$500,000 + (0.02 x sales) = (0.10 x sales)
$500,000 = (0.10 x sales) – (0.02 x sales)
$500,000 = (0.08 x sales)
Therefore,
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$500,000 Sales = ——————— = $6,250,000 0.08
If Brown expects sales to be greater than $6,250,000, then using its own salesforce will be more efficient than using sales agents. If sales are less than this level, then it would be more efficient to use sales agents because the company would not incur the fixed costs associated with maintaining a salesforce.
Sales agents are independent of the manufacturer’s organization and typically are paid on
commission, so a manufacturer does not have the fixed costs that are necessary to maintain a
full-time sales force. A manufacturer’s selling costs are based on the amount the sales agent
sells for the manufacturer. On the downside, however, sales agents typically sell multiple
products from different manufacturers, although agents don’t normally sell a competitor’s
product. However, they cannot devote all of their selling efforts on a given manufacturer’s
products nor are they as knowledgeable about a specific product as a manufacturer’s sales
representative. Sales agents might be a smart choice if the manufacturer does not have the
resources to maintain its own salesforce.
A manufacturer’s sales representative is an employee of the company, and the company
incurs all the costs of employment. Even if a sales representative only receives compensation
based on commission, there are still other employment costs involved, such as benefits.
Unlike sales agents, however, a manufacturer’s sales force devotes all of its effort to selling
the manufacturer’s products and are more knowledgeable about the products.
Company Case Notes
Salesforce.com: Helping Companies Super-Charge The Selling Process
Synopsis
When Salesforce.com launched in 1999, its model for providing CRM software to businesses
was ahead of its time. In a field of providers that created customer proprietary software installed
on client desktop computers and servers, Salesforce.com’s big thing was ―no software‖. It
focused on creating standardized and semi-custom products made available to customers via the
Internet. With no software to install and a more simple interface, Salesforce.com was easier to
use, faster to get up and running, and less expensive. Salesforce.com has since remained ahead of
the pack by focusing on innovation. It now has various CRM products that are available to
clients large and small. It is a market leader that appears to have revolutionized its market and
shows no signs of slowing down.
Teaching Objectives
The teaching objectives for this case are to:
1. Allow students to consider the role of a company’s salespeople in creating value for and
building relationships with customers.
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2. Help students understand how companies make sales force strategy decisions.
3. Give students exposure to the different steps in the sales process.
4. To consider the dynamics of the marketing environment and their impact on sales
organizations.
Discussion Questions
1. When Salesforce.com launched as an Internet-based service, how did that innovation help
sales reps to interact better with customers?
With no software to install, companies could have the salesforce.com tools up and
running in very little time with less investment. SF was ahead of its time in using an
online and “cloud” model for this kind of service. This method also gave sales reps easy
access to the system from any location with Internet access. This was also not common at
the time. With quicker, easier, and more convenient access, this gave sales reps plenty of
benefits for servicing customers.
2. Describe the differences that Salesforce.com has made for customers NBCU and GE
Capital.
Integrating customers – sales forces can be integrated across customers. All sales reps
in every department and division can access client activity across all different touch
points for the company.
Collaboration – sales forces can distribute the right social information to account execs
and the right time, improving customer relationships.
Cross-selling – As these companies are big and complex with many different divisions,
the above-mentioned benefits have resulted in more opportunities for cross-selling. That
not only improves revenues, it makes for stronger customer relationships.
3. Consider the selling process. How might any of the Salesforce.com tools described in this
case facilitate each step?
Data.com – prospecting and qualifying.
Database.com – prospecting and qualifying, handling objections, closing, follow-up.
Site.com – preapproach, approach, presentation and demonstration, handling objections,
closing, follow-up.
Desk.com – preapproach, approach, presentation and demonstration, handling
objections, closing, follow-up.
Sales Cloud – presentation and demonstration, handling objections, closing, follow-up.
4. Looking forward, what products will Salesforce.com have to develop in order to remain
on the cutting edge of supporting sales staffs with information and collaboration?
Push students to consider and speculate on the direction they think social media and
mobile devices are headed. That should provide direction on what they think
Salesforce.com will need to develop in order to remain ahead of the market. Answers will
vary.
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Teaching Suggestions
Have students break out into groups. Have them visit www.salesforce.com. Assign each one of
them a Salesforce.com product. Give them 10-15 minutes and have them report on what that
product is, the benefits that it provides to client users, and the stages of the selling process it
facilitates.
This case can also be used with the chapter on competitive advantage (Chapter 18).
ADDITIONAL PROJECTS, ASSIGNMENTS, AND EXAMPLES
Projects
1. Take a look at Microsoft (www.microsoft.com). What is the role of the personal sales
force in that company? (Objective 1)
2. Examine Dell (www.dell.com). How is Dell’s sales force structured? (Objective 2)
3. List and describe each step of the personal selling process. Analyze your own potential as
a salesperson at each step of the process. What steps of the process would be the easiest
for you to handle and what steps the most difficult? Why? (Objective 3)
4. Consider your college/university. How could they effectively use sales promotion as a
recruiting tool? (Objective 4)
5. Think about the popular Web-based travel site, Kayak (www.kayak.com). How could
Kayak use event marketing to effectively promote its business? (Objective 4)
Small Group Assignments
1. Form students into groups of three to five. Each group should read the opening vignette
to the chapter on IBM. Each group should then answer the following questions and share
their answers with the class. (Objective 1, 2, and 3)
a. How would you describe the ―solutions selling‖ sales culture at IBM?
b. At its heart, what is fundamentally different about IBM’s approach compared to
competitors? What makes it work better for customers?
c. In your own words, explain how IBM’s Vivek Gupta succeeded in India where
competitors may have failed.
2. Form students into groups of three to five. Each group should read Real Marketing 16.2:
―P&G: It’s Not Sales, It’s Customer Business Development.‖ Each group should then
answer the following questions and share their answers with the class. (Objective 3)
a. What does ―Customer Business Development‖ mean at P&G? How does it differ
from the standard sales approach?
b. How do P&G salespeople deal with large, complex accounts?
c. Why do customers allow P&G to advise them on the stocking and placement of
competitors’ brands as well as its own?
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Individual Assignments
1. The sales force serves as a critical link between a company and its customers. They
represent the company to customers and they represent customers to the company.
Explain how this would work for a company such as CDW. (Objective 1)
2. Recruiting qualified sales applicants is a difficult job for a sales manager. Review the
position openings for sales people at Boeing (https://jobs.boeing.com/), IBM
(www.ibm.com/us/) and Mars (www.mars.com/global/home.htm). See the requirements
for a sales position with each of these companies. (Objective 2)
Think-Pair-Share
Consider the following questions, formulate an answer, pair with the student on your right, share
your thoughts with one another, and respond to questions from the instructor:
1. What do you believe to be the major advantages and disadvantages of team selling?
(Objective 2)
2. What are the major forms of sales force compensation? Which do you believe to be
superior? Why? (Objective 2)
3. List and briefly describe the stages of the personal selling process. (Objective 3)
4. In the personal selling process, when would you consider the sell over? Why?
(Objective 3)
5. In the past, pharmaceutical companies have provided and paid for educational seminars
in exotic locations for physicians to which they were promoting a specific drug. The hope
was that the physician would then prescribe their medication. Do you believe this is
ethical? Why or why not?
Outside Examples
1. Consider that you are a salesperson for the local Toyota dealership. A young, newly
married couple enters the lot. Walk us through the personal selling process, using this
couple as your target. (Objective 3)
Possible Solution:
Step 1: Prospecting and Qualifying. In this case, there is no prospecting involved. The
potential customer comes to you. It becomes your job to qualify them as potentials as
quickly as possible. However, the qualification will have to wait until the actual
approach.
Step 2: Preapproach. The salesperson has the responsibility of preparing his/her initial
greeting and direction he/she believes the presentation should take.
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Step 3: Approach. The opening lines are important. It is necessary not only to build an
immediate rapport with the couple, it is important to learn their needs, wants, and abilities
as quickly as possible.
Step 4: Presentation and Demonstration. The salesperson should have their method of
presentation decided at this point. Here the salesperson tells the ―value story.‖ This is
where the buyers see how this product fits their requirements.
Step 5: Handling Objections. If the (potential) buyers believe the price is too much, the
salesperson can demonstrate how their financing options can get the monthly amounts to
a reasonable level. If they want to ―think about it,‖ the salesperson may offer an incentive
to purchase now. Whatever the objection may be, the well-informed salesperson will
already have the information and skills to overcome.
Step 6: Closing. This is the moment where it is important for our salesperson to ask for
the sale. In many cases, it becomes necessary for the salesperson to take the lead and
direct the buyer to ―come on inside and let’s write this up.‖ At this point, the majority of
significant objections should have been met.
Step 7: Follow-Up. The sale is never over. It is important to remain in contact with the
buyer as time goes by. They may come back to you for their next vehicle or they may
refer their friends to you.
2. Rent the classic movie Death of a Salesman. This was originally a play on Broadway
authored by Arthur Miller, in 1949. It was later made into a successful movie. Watch it
and review the approach to selling discussed. (Objective 3)
Possible Solution:
Death of a Salesman deals only tangentially with sales and the selling process. But it does
so enough to drive home the points.
Willy Loman, a salesman based in New York City, returns home from a trip to Yonkers
where his sons, Biff and Happy, and his wife, Linda, greet him.
Willy is reminded of his brother Ben. Through flashbacks, Ben begins a dialogue with
Willy, who contemplates why he can never seem to become successful.
Throughout the play, Willy has these imaginary conversations with Ben, during most of
which he asks Ben how he made his millions. Ben had tried to go to Alaska to get
involved in logging but ended up in Africa. In Africa, he ―stumbled‖ upon the diamond
business and become wealthy by the time Willy was old enough to care about his own
career.
Willy feels that he can also become successful by luck alone.
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Whenever Willy asks Ben (in his flashbacks) how he made his millions, Ben only
answers ―When I walked into the jungle, I was 17. When I walked out, I was 21, and by
God I was rich.‖
In addition, Willy worked for a man who only had to wake up in the morning, put his
slippers on, and make phone calls, and had made millions of dollars. Willy assumes that
one does not need to work hard or have ambition; that all these men needed was a ―smile
and a shoeshine‖ to be successful.
This philosophy does not work out for Willy.
The primary point to drive home is that success in selling does not come by accident.
Professional salespeople succeed through thorough research and planning for
contingencies.
Web Resources
1. http://247.prenhall.com
This is the link to the Prentice Hall support link.
2. www.IBM.com
Information here will be helpful as you read the opening vignette.
3. www.hp.com/hpinfo/
This is Hewlett-Packard’s corporate homepage.
4. www.proudfootconsulting.com/
Proudfoot Consulting maintains useful information on sales force management
5. www.bestbuy.com
Check out Best Buy’s weekly newspaper insert for an example of sales promotion.