978-0136074892 Solution Manual Chapter 13 Part 2

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H. Changing Nature of the Sales Force: The Impact of Technology

1. Re-engineering of sales (virtual selling) has occurred for several reasons:

·Personal selling has become more complex and more difficult to make a sale

·Customers have become more knowledgeable about what they want, but

also need guidance and advice

·Corporations are becoming increasingly flat with fewer middle managers

providing product information

·Intensifying global competition means more pressure at the point-of-sale

·Demand for productivity from all parts of the organization

2. Software has been developed to help salespeople perform standard activities

(customer relationship management software.)

3. Table 13.2 Page 394 The Virtual Selling Organization Outlines the characteristics

of the virtual selling organization.

4. Illustration: Waters NuGenesis Technologies Corp. (www.waters.com) Page 394

5. Illustration: Lanier Worldwide (www.lanier.com) Page 394

6. Other Innovations:

·Virtual sales representatives who interact with visitors to the companies

web site see Figure 13.12 Page 394 Medconference (AstraZeneca)

I. Direct Marketing

1. Direct Marketing Process: Interactive and needs a measurable response.

·Direct marketing targets individuals usually for a short-run response.

·No salespeople are involved in the process.

·Direct marketing is a communication and channel of distribution.

·This type of marketing is easily measured because there is a response

from the customer.

·Process involves:

·Setting an objective

·Determining the target market

·Choosing the medium/media

·Getting a list of customers

·Analyzing the list

·Developing the offer

·Testing the offer

·Analyzing the results

2. Direct Marketing Methods:

·Include Internet-based marketing, T.V. (infomercials) and radio.

·Increase in this method due to desire to increase the efficiency of channels

of distribution and the increase in customer databases to make the method

successful.

·Table 13.3 Page 397 Direct Marketing Sales by Medium and Market

·Telemarketing: Personal message at least in theory, intrusive and expensive

for the company. To make this medium successful:

·The list of customers must be a good list of prospects

·The offer must be difficult to pass up and

·Integrity.

·There are perceived risk to purchasing over the telephone must offer

risk reducers such as money back guarantees and brand recognition

·Direct Mail: Less expensive for the company, less intrusive for the customer

and less ill will toward method than telemarketing. To be successful:

·The copy should be persuasive explaining the product’s benefits, large

font, short and friendly.

·Guidelines say it should not take a reader more than 4 minutes to get the

message. Layout/design is important because mail is often screened

particularly in business-to-business situations.

·Illustration: Caterpillar (www.cat.com) Page 400

·Direct E-mail

·Table 13.5 Page 402 Relative Effectiveness of Direct E-mail Outlines

the effectiveness of direct e-mail including response rates, cost per

contact, revenue per contact, and ROI index

·Illustration: Seiko (www.seikousa.com ) Page 401

3. Privacy Issues: Of the three direct-marketing channels, telemarketing and e-mail have

received the most attention from regulators.

·Telemarketing: Federal Trade Commission established a do-not- call list

where customers who do not wish to receive telemarketing could be put on

the list and companies that violated would be fined.

·Internet privacy issues: Platform for Privacy Preferences standards on the

Internet mandates that web sites must provide options to customers such as

opting in or opting out of receiving direct e-mail.

·European Union Directive on Data Protection established in 1998 states:

·A company must obtain permission of the customer to obtain personal

information and explain its purpose

·It must promise not to use it for anything other than the stated purpose

without consent.

Teaching Tips and Strategies from Barbara S. Faries, MBA

The purpose of this chapter is to introduce the concepts involved with direct

channels of distribution including personal selling and direct marketing.

Key Terms and Concepts Introduced Include:

·Territory

·Breakdown method

·Workload method

·Marginal economic method

·Sales quotas

·Commission

·Salary

·Incentive payments

·Sales contests

·Virtual selling

·Direct marketing

·Measurable response

Note: Two recurring themes in this Instructor’s Manual are the first two items:

·Link theory to practice.

·Engage students to link work experience to the concepts demonstrated in

the text.

·Instructors are encouraged to link theory to practice by finding current examples

in the business environment that demonstrate the key concepts above.

·If your class contains those already working in the field, have them describe how

the concepts in theory match those in the actual workplace.

One of the most neglected aspects of teaching marketing and market management is

personal selling. Many students continue to embrace the old image of the high-pressure

sales person rather than the new model of relationship-builder and business developer. I

encourage discussion of the personal selling process and emphasize how important it is in

the marketing process. If you have students who are salespersons, it is often productive for

them to discuss their jobs and how they approach the selling process. Many times the

discussion will include the salesperson as business developer and long-term customer

relationship builder.

The chapter touched on the various software programs that assist salespersons and

companies track their customers and prospects. I have the students discuss those they know

about and compare/contrast the benefits/features while pointing out that these help build

sustainable customer relationships. (Chapter 14 Customer Relationship Management

expands on this topic.) Well-known customer relationship management (CRMs) systems

include:

Salesforce www.salesforce.com

ACT! www.act.com

GoldMine CRM www.frontrange.com/goldmine

SalesNow www.salesnow.com

FreeCRM www.freecrm.com

SugarCRM www.sugarcrm.com

Review Questions

1. It is sometimes said that salespeople should be familiar with their customers’ marketing

plans (e.g., understanding the customers’ competitors and customers). Of what use

would this information be to the salesperson?

2. Considering the different tasks a salesperson must perform how is the job different for

an automobile salesperson and a representative selling a computer system?

3. What products or services would be most appropriate for implementing the three

different approaches to determining sales force size described in this chapter? Be

specific.

4. Besides the criteria for assigning salespeople to territories described in the book, what

other factors should be taken into account?

5. How should the increased use of technology in the salesperson’s job affect companies’

recruiting and hiring practices? What are the benefits of having a sales force that is

sophisticated in its use of technology?

6. For what kinds of products and services would direct e-mail be appropriate? Other

than sales, what other goals can direct e-mail achieve?