978-0134149530 Chapter 13 Lecture Note Part 2

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THE PERSONAL SELLING PROCESS

Steps in the Selling Process (Figure 13.3)

Use Chapter Objective 3 here.

Use Key Term Selling Process here.

Use Figure 13.3 here.

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

1. Prospecting and Qualifying

Prospecting involves identifying qualified potential customers.

The best source of prospects is referrals.

There are several sources of referrals.

Current customers

Suppliers, dealers, and noncompeting salespeople

The Web or other social network contacts

Unannounced office visits (a practice known as “cold calling”)

Qualifying a lead requires knowing how to identify the good ones and screen out the poor ones.

Prospects can be qualified by looking at various factors.

Financial ability

Volume of business

Special needs

Location

Possibilities for growth

2. Preapproach

The 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 are set by the salesperson and may involve qualifying the prospect, gathering

information, or making an immediate sale.

Other call objectives may include deciding on the best approach and the best timing and

determining the overall sales strategy for the account.

3. 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.

4. Presentation and Demonstration

During the presentation step of the selling process, 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.

Before salespeople can present customer solutions, they must develop solutions to present.

The following qualities are ones that buyers dislike most in salespeople:

Pushiness

Being late

Deceitfulness

Being unprepared or disorganized

The following qualities are ones that buyers value most in salespeople:

Good listening skills

Empathy

Honesty

Dependability

Thoroughness

Follow-through

5. Handling Objections

In handling objections, the salesperson should do the following:

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.

6. 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

7. Follow-Up

Follow-up is necessary if the salesperson wants to ensure customer satisfaction and repeat

business.

Use Key Terms Prospecting, Preapproach, Approach, Presentation, Handling Objections,

Closing, and Follow-Up here.

Use Critical Thinking Exercises 13-7 and 13-8 here.

Use Marketing Ethics here.

Personal Selling and Managing Customer Relationships

A transaction orientation is intended to help salespeople close a specific sale with a customer.

A relationship orientation is intended to serve the customer over the long haul in a mutually

profitable relationship.

Most companies want their salespeople to practice value selling—demonstrating and delivering

superior customer value and capturing a return on that value that is fair for both the customer and

the company.

Use Marketing at Work 13.2 here.

SALES PROMOTION

Sales promotion consists of short-term incentives to encourage the purchase or sale of a

product or service.

Use Chapter Objective 4 here.

Use Discussion Question 13-5 here.

Use Key Term Sales Promotion here.

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 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 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: Generate business leads, stimulate purchases, reward customers,

and motivate salespeople.

Sales promotions should help to reinforce the product’s position and build long-term customer

relationships.

Frequency marketing programs and loyalty card programs have mushroomed in popularity in

recent years. These are programs that give rewards to regular customers to keep them coming

back.

Major Sales Promotion Tools

Many tools can be used to accomplish sales promotion objectives. Descriptions of the main

consumer, trade, and business promotion tools follow.

Consumer Promotions

Use Key Term Customer Promotions here.

Use Critical Thinking Exercise 13-9 here.

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 save buyers money when they purchase specified products.

Most major consumer goods companies are issuing fewer coupons and targeting them more

carefully.

Cash refunds (or rebates) 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 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.

Use Marketing at Work 13.2 here.

Use Online, Mobile, and Social Media Marketing here.

Trade Promotions

Trade promotions persuade resellers to carry a brand, give it shelf space, promote it in

advertising, and push it to consumers.

Use Key Terms Event Marketing and Trade Promotions here.

Use Discussion Question 13-6 here.

Manufacturers direct more sales promotion dollars toward retailers and wholesalers (79 percent)

than to final consumers (21 percent).

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.

Use Key Term Business Promotions here.

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 audiovisual 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.

Sales contests work best when they are tied to measurable and achievable sales objectives (such

as finding new accounts, reviving old accounts, or increasing account profitability).

Developing the Sales Promotion Program

Marketers must determine the following when designing the sales promotion program:

1. Size of the incentive

2. Conditions for participation

3. Promotion and distribution

4. Length of the promotion

5. Evaluation methods

Video Case: First Flavor

First Flavor is a start-up company with a unique product. It manufactures great-tasting edible

film that can replicate the flavor of just about anything, from an eight-topping pizza to an

alcoholic beverage. If you’re wondering why a company would make such a product, think of

the endless possibilities it allows for consumers to sample the taste of a food or beverage before

purchasing it.

Although First Flavor first replicated flavors on thin film in order to market the product as a new

method for product sampling, the company is now evaluating many other applications of the

technology. This video demonstrates how one product can be marketed in multiple ways.

After viewing the video featuring First Flavor, answer the following questions:

13-15. Classify First Flavor’s core business as a sales promotion element.

13-16. Brainstorm a list of the ways that First Flavor’s edible film might be used to

sample products.

13-17. Can First Flavor successfully in pursue consumer product opportunities in addition

to its promotional services? Explain.

Company Cases

13 Sunguard/8 3M

See Appendix 1 for cases appropriate for this chapter.

Case 13, Sungard: Building Sustained Growth by Selling the SunGard Way. Consistently

one of the top companies to sell for, Sungard is out to stay that way through a complete

transformation of its sales force model.

Case 8, 3M: Where Innovation Is a Way of Life. Although it has many consumer products, 3M

is truly a B2B company that relies on a strong sales force.

MyMarketingLab

If assigned by your instructor, complete these writing sections from your Assignments in the

MyLab.

13-18. What is social selling, and how is it affecting the sales function in organizations?

(AACSB: Communication; Reflective Thinking)

13-19. What is team selling, and why has it become more important? Are there any

pitfalls to this approach? (AACSB: Communication; Reflective Thinking)

GREAT IDEAS

Barriers to Effective Learning

1. 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.

2. 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.

3. 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.

4. Direct marketing is a hot topic these days because of the national Do-Not-Call list and the

recently passed federal legislation on anti-spamming. The students should be able to

maintain their interest in this topic, but they may be surprised that direct marketing is not

just for underfunded or shady enterprises.

Student Projects

1. Examine Salesforce (www.salesforce.com). How is the Salesforce sales force structured?

2. List and describe each step of the personal selling process. Analyze your own potential as

a sales person 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?

3. Consider your college/university. How could they effectively use sales promotion as a

recruiting tool?

4. What are the distinguishing features between transaction-oriented marketing and

relationship marketing?

5. Discuss the pros and cons of the different sales force compensation methods.

Small Group Assignment

Form students into groups of three to five. Each group should read the opening vignette to the

chapter on Salesforce. Each group should then answer the following questions:

1. What is the role of the sales force in Salesforce?

2. What sort of people would you recruit for the Salesforce sales force?

3. How would you motivate such highly-trained salespeople? Be specific.

4. In an Internet environment, how would you prospect for and qualify potential customers?

Each group should share its findings with the class.

Individual Assignment

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 Salesforce.

Think-Pair-Share

Consider the following questions, formulate answers, pair with the student on your right, share

your thoughts with one another, and respond to questions from the instructor:

1. What are the major forms of sales force compensation? Which do you believe to be

superior? Why?

2. List and briefly describe the stages of the personal selling process.

3. What is direct marketing?

4. What do you believe to be the major advantages and disadvantages of team selling?

5. In the personal selling process, when would you consider the sale over? Why?

Classroom Exercise/Homework Assignment

Consider 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.

Classroom Management Strategies

This chapter describes two communications methods for integrated marketing communications.

Most of the chapter is spent on the sales process, and then sales promotion is discussed.

1. The introduction and Personal Selling section can be covered in 5 minutes. These

sections set the stage for the next two sections, and for that reason should not be rushed

through.

2. Spend 20 minutes going over the section entitled Managing the Sales Force. This is

critical information that the students will need to learn. Figure 13.1 provides an

introduction to the steps in sales force management. Review Table 13.1 to show the

connection between marketing strategy and sales force compensation.

3. The Personal Selling Process can be covered in 15 minutes. Be sure to work with the

students to ensure their understanding of each step of the process. Having them team up

to “sell” something to other teams is often helpful in this section, ensuring that they

“prospect,” develop their preapproach and approach, and then present, close, and

follow-up. Figure 13.3 shows the complete selling process.

4. The Sales Promotion section is a packed section. Spend 20 minutes here, paying

particular attention to the subsections on the various types of sales promotion programs.

PROFESSORS ON THE GO

Personal Selling and Sales Promotion

Key Concepts

The nature of personal selling and the role of the sales force

Designing the sales force strategy and structure

Managing the sales force

According to the chapter, salespeople serve “two masters.” What does this mean? Is it

a good or bad thing?

The ability to build relationships with customers is the most important of a

salesperson’s key talents. Do you agree with this statement? Explain.

What is the role of the sales force in modern business?

Key Concepts

Seven steps in the personal selling process

Customer relationship management

The text emphasizes the link between personal selling and customer relationship

management. Why is this link such an important concept?

Suppose your grade in one of your classes is hovering between an A and B. How

would you apply the seven steps in the personal selling process to convince your

professor that you deserve an A?

Demonstrate how a salesperson could prospect for sales customers via the Internet.

Which search sites seemed to be the most effective in your search effort? Try to be as

specific as possible with the illustration you chose.

How should salespeople strive to build relationships? What is relationship marketing?

Key Concepts

The different types of sales promotion objectives

Customer promotions

Sales promotion objectives vary greatly. Suppose you are interested in spurring

short-term customer buying of your product. What type of sales promotion do you

believe would be the most appropriate? Why?

Go to your local department of discount store. List and describe four examples of

customer promotions you see. Which do you believe to be the most effective?