Chapter 18 – Personal Selling and Sales Promotion PDF

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Personal Selling and Sales Promotion - Charles Sharp...

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Chapter 18 – Personal Selling and Sales Promotion Personal Selling  Paid personal communication that attempts to informs customers and persuades them to buy products in an exchange Advantages and Disadvantages of Personal Selling  Advantages

o Provides marketers the greatest freedom to adjust a message to satisfy customers o The most precise of all promotional methods; enables marketers to focus on the most promising sales prospects  Disadvantages o The disadvantage of personal selling is that it is the most expensive element in the promotion mix General Steps in the Personal Selling Process

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Prospecting Preapproach Approach Making the presentation Overcoming objections Closing the sale Following up

Types of Salespeople  Order Getters

o Salespeople who sell to new customers and increase sales to current customers  Current-customer sales

 New-business sales o Order Takers  Salespeople who primarily seek repeat sales  Inside order takers work in sales offices  Field order takers travel to customers  Support Personnel o Sales staff members who facilitate selling but usually are not involved solely with making sales  Missionary salespeople, usually employed by a manufacturer, assist the producer’s customers promote a product  Trade salespeople involved mainly in helping a producer’s customers promote a product  Technical salespeople give technical assistance to a firm’s current customers Selected Types of Selling  Team Selling

o Using a team of experts from all functional areas of a firm, led by a salesperson, to conduct the personal selling process  Relationship Selling o Building of mutually beneficial long-term associations with a customer through regular communications over prolonged periods of time Compensating Salespeople  Compensation should be flexible, equitable and easy to administer

o Compensation levels should reflect a salesperson’s value to the company  Straight Salary Compensation Plan o Paying salespeople a specific amount per time period, regardless of selling effort

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 Straight Commission Compensation Plan

o Paying salespeople according to the amount of their sales in a given time period  Combination Compensation Plan o Paying salespeople a fixed salary plus commission based on sales volume Motivating Salespeople  Additional efforts beyond compensation are necessary for motivation  Managers must identify their employees’ needs and goals and strive to

create a positive organizational climate  Incentives programs pay for themselves by making workers happier and more committed Sales Promotion  An activity and/or material that acts as an inducement/incentive to

resellers or salespeople to sell a product or consumers to buy it Sales Promotion is Popular  Sales promotion is more heavily used than ever; at the expense of

advertising o Heightened customer concerns about value o Retailers have considerable power in the supply chain and are demanding greater promotional efforts o Declines in brand loyalty mean sales promotions are more effective o The stronger emphasis place on improving short-term results calls for greater use of sales promotion methods Consumer Sales Promotion Methods  Consumer Sales Promotion Methods

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o Sales promotion techniques that encourage consumers to patronize specific stores or try particular products  Coupons o Written price reductions used to encourage consumers to buy a specific product  Is the most widely-used consumer sales promotion technique Coupons  Advantages

o Reward present users/win back former users  Encourage purchases in large quantities o Are traceable to target market  Disadvantages o Fraud and misredemption o Customer reliance o Brand loyalty diminished Other Consumer Promotional Methods  Cents-Off

o Promotions that allow buyers to pay less than the regular price to encourage purchase  Refunds o Promotion techniques that offer consumers a specified amount of money when they mail in a proof of purchase, usually for multiple product purchases  Rebates o Promotion techniques in which a consumer receives a specified amount of money for making a single product purchase  Frequent-User Incentives o Many firms develop incentive programs to regard customers who engage in repeat/frequent purchases

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 Point-of-Purchase Materials (POP)

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o Signs, window displays, counter pieces, etc. designed to attract attention and inform customers Demonstrations o Sales promotion methods a manufacturer uses temporarily to encourage trial and purchase of a product or to show how a product works Free Samples o Samples of a product given out to encourage trial or purchase Premiums o Items offered free or at a minimal cost as a bonus for purchasing a product Consumer Contests o Sales promotion methods in which individuals compete for prizes based on their analytical or creative skills Consumer Games o Sales promotion methods in which individuals compete for prizes based primarily on chance Consumer Sweepstakes o A sales promotion in which entrants submit their names for inclusion in a drawing for prizes Trade Sales Promotion Methods o Attempt to persuade wholesalers and retailers to carry and aggressively market a producer’s product

Trade Allowances  Buying Allowance

o A temporary price reduction to resellers for purchasing a specific quantity of a product  Merchandise Allowance o A manufacturer’s agreement to pay resellers certain amounts of money for providing special promotional efforts, such as setting up and maintaining a display

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Cooperative Advertising and Dealer Listings  Cooperative Advertising

o An arrangement in which a manufacturer agrees to pay a certain amount of a retailer’s media costs for advertising the manufacturer’s products  Dealer Listings o Advertisements promoting a product and identifying the names of retailers that sell the product Free Merchandise and Gifts  Free Merchandise

o A manufacturer’s reward given to resellers that purchase a stated quantity of products  Dealer Loader o A gift given to a retailer that purchases a specified quantity of merchandise o Often used to coerce special display efforts Premium (Push) Money  Additional compensation to salespeople offered by the manufacturer

as an incentive to push a line of goods  Is a good method when personal selling is important to the marketing effort

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