Principles of Marketing

Lecture-37

Summaryof

Lecture-36

Sales Force Management

Steps in the Selling Process

Managing the Sales force

Designing Sales force Strategy and StructureDesigning Sales force Strategy and Structure

Recruiting and Selecting SalespeopleRecruiting and Selecting Salespeople

Training SalespeopleTraining Salespeople

Compensating SalespeopleCompensating Salespeople

Supervising SalespeopleSupervising Salespeople

Evaluating SalespeopleEvaluating Salespeople

Today’s Topics

Sales force Management (cont..)

Direct Marketing

Supervising Salespeople

Directing Salesperson

Motivating Salesperson

Motivating Salespeople

• Organizational Climate

• Sales Quotas

• Positive Incentives

– Honors

– Awards

– Merchandise/ Cash

– Trips

How Salespeople Spend Their

Time

Administrative Tasks17%

TelephoneSelling

21%

Waiting/ Traveling

20%

Service Calls

12%

Face-to-Face Selling

30%

Companies Look For Ways to Increase the Amount of Time Salespeople Spend Selling.

Evaluating Salespeople

AnnualTerritory

Marketing Plan

AnnualTerritory

Marketing Plan

CallReports

CallReports

ExpenseReports

ExpenseReports

WorkPlan

WorkPlan

SalesReportSales

Report

Sourcesof

Information

Sourcesof

Information

Quantitative Criteria– Orders

• Number of orders obtained• Average order size (units or dollars)• Number of orders canceled by customers

– Sales volume• Dollar sales volume• Unit sales volume• By customer type• By product category• Translated into market share• Percentage of sales quota achieved

– Margins• Gross margin• Net profit• By customer type• By product category

– Customer accounts• Number of new accounts• Number of lost accounts• Percentage of accounts sold• Number of overdue accounts• Collections made of accounts receivable

– Sales calls• Number made on current customers• Number made on potential new accounts• Average time spent per call• Number of sales presentations• Selling time versus nonselling time• Call frequency ratio per customer type

– Selling expenses• Average per sales call• As percentage of sales volume• As percentage of sales quota• Direct-selling expense ratios• Indirect-selling expense ratios

– Customer service

• Number of service calls

• Displays set up

• Delivery cost per unit sold

• Months of inventory held, by

customer type

• Number of customer complaints

• Percentage of goods returned

– Selling skills• Knowing the company and its policies• Knowing competitors’ products and sales strategies• Understanding of selling techniques• Customer feedback (positive and negative)• Product knowledge• Customer knowledge• Execution of selling techniques• Quality of sales presentations• Communication skills

Qualitative Criteria – Sales-related activities

• Territory management: sales call preparation, scheduling, routing, and time utilization

• Marketing intelligence: new product ideas, competitive activities, new customer preferences

• Follow-ups: use of promotional brochures and correspondence with current and potential accounts

• Customer relations• Report preparation and timely submission

– Personal characteristics• Cooperation• Human relations• Enthusiasm motivation• Judgment• Care of company property• Appearance• Self-improvement efforts• Patience• Punctuality• Initiative• Resourcefulness• Health• Sales management potential• Ethical and moral behavior

Developing the Sales force

RecruitingRecruiting SelectingSelecting TrainingTraining

Direct Marketing

One-to-One One-to-One MarketingMarketing

Direct communications with carefully targeted individual consumers to obtain an immediate response.

Direct Marketing Fastest growing

promotional mix element

Easy to narrowly target a segment

Measure outcomes easier

Databases are extremely important

Direct MarketingDirect Marketing

Bettertargetingreduceswaste

Bettertargetingreduceswaste

Breaksthrough ad

clutter

Breaksthrough ad

clutter

Direct Marketing Consists of Direct Connections With

Carefully Targeted Individual Consumers to Both Obtain an

Immediate Response and Cultivate Lasting Customer

Relationships.

Most Mass Marketing Involves One-Way Communications Aimed At Consumers.

Direct Marketing Involves Two-Way Interactions With Customers.

Direct Marketing

Direct Marketing

Focuses on Share of CustomerFocuses on Share of Customer

Develops CustomersDevelops Customers

Finds Products for CustomersFinds Products for Customers

Mass Marketing

Mass Marketing

Focuses on Share of MarketFocuses on Share of Market

Develops ProductsDevelops Products

Finds Customers for ProductsFinds Customers for Products

Communications Process Differences

Message isPersonalizedPersonalizedMessage is

PersonalizedPersonalized

Channel isDirectDirect

Channel isDirectDirect

NoiseNoise is not present

NoiseNoise is not present

Individual ResponseResponse is captured

Individual ResponseResponse is captured

The New Direct Marketing Model

Some firms use direct marketing as a supplemental medium.

For many companies, direct marketing - especially Internet and e-commerce companies - constitutes a new and complete model for doing business.

Some firms use the new direct model as their only approach.

Experts envision a day when all buying and selling will involve direct connections between companies and their customers.

Advantages of Direct Marketing

The ability to identify the most profitable customer.

The ability to create long-term relationships with customers.

The ability to target marketing efforts only to those people most likely to be interested.

The ability to offer varied messages to different consumers.

Increased knowledge about the customer.

Factors Driving Direct Marketing Growth

PredictiveModeling

PredictiveModeling

CustomizedProducts

CustomizedProducts

ConvenienceConvenience

FragmentedMarkets

FragmentedMarkets

ShrinkingMedia Audiences

ShrinkingMedia Audiences

ImmediateSales

ImmediateSales

PriceSensitivity

PriceSensitivity

Demassification – Focus is Toward Minimarkets

Demassification – Focus is Toward Minimarkets

Higher Costs of Driving, Traffic and Parking Congestion

Higher Costs of Driving, Traffic and Parking Congestion

Consumers Lack of TimeConsumers Lack of Time

Convenience of Ordering From Direct Marketers

Convenience of Ordering From Direct Marketers

Growth of Customer DatabasesGrowth of Customer Databases

Forms of Direct Marketing

Direct Mail

KioskMarketing

OnlineMarketing Telemarketing

Direct-ResponseTV Marketing

Catalog

Face-to-Face Selling

Techniques of Direct Marketing

ElectronicMedia

ElectronicMedia

Direct SellingDirect Selling

PrintMediaPrint

MediaBroadcast

MediaBroadcast

Media

Direct MailDirect Mail

TelemarketingTelemarketing

Direct Mail

Self-Contained MessageSelf-Contained Message

FlexibilityFlexibility

Thorough Target Market Coverage

Thorough Target Market Coverage

Fewer Distractions From Other Media

Fewer Distractions From Other Media

Large Number of Mail-Order Buyers

Large Number of Mail-Order Buyers

Advantages Disadvantages

High Cost Per ExposureHigh Cost Per Exposure

Potential Delivery DelaysPotential Delivery Delays

Lack of Support From Other Media

Lack of Support From Other Media

Easy to IgnoreEasy to Ignore

Seen as Wasteful, Harmful to Environment

Seen as Wasteful, Harmful to Environment

Customer Databases

Customer Databases are an Organized Collection of Comprehensive Data About Individual Customers or Prospects Including:

–Geographic,

–Demographic,

–Psychographic, and

–Behavioral Data.

IndividualizedIndividualized

Information-IntensiveInformation-Intensive

Customer-BasedCustomer-Based

Long-Term OrientedLong-Term Oriented

Share of CustomerShare of Customer

With a Focuson...

DatabaseTechnologyDatabase

Technology

DirectMarketing is...

DirectMarketing is...

Through Use of...

Database Marketing

Database Marketing is the Process of Building,

Maintaining, and Using Customer Databases and Other Databases for the

Purposes of Contacting and Transacting With Customers.

Marketing Database

The compilation of names, addresses,

and other pieces of pertinent

information about individual customers

and prospects that affects what and

how marketers

sell to them.

Identifying Prospects Identifying Prospects

Deciding Which Customers Should Receive a Particular Offer

Deciding Which Customers Should Receive a Particular Offer

Deepening Customer LoyaltyDeepening Customer Loyalty

Reactivating Customer Purchases Reactivating Customer Purchases

How Companies Use Their Databases ?

Enough for today. . .

Summary

Supervising Salespeople

Motivating Salespeople

Evaluating Salespeople

Direct Marketing

Direct MarketingDirect Marketing

Bettertargetingreduceswaste

Bettertargetingreduceswaste

Breaksthrough ad

clutter

Breaksthrough ad

clutter

Advantages of Direct Marketing

Factors Driving Direct Marketing Growth

Forms of Direct Marketing

Customer Databases

Next….

Public Relations

Principles of Marketing

Lecture-37