Chapter 16Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared.

Chapter 16 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1

MKTG

Designed byAmy McGuire, B-books, Ltd.

Prepared byDeborah Baker, Texas Christian University

Lamb, Hair, McDaniel 2007-2008

Sales Promotion and Personal Selling

16

CHAPTER


LO1

Sales Promotion

Marketing

communication

activities, other than

advertising, personal

selling, and public

relations, in which a

short-term incentive

motivates a purchase.

SalesPromotion

SalesPromotion


LO1

Sales Promotion

Advertising Reason to buy

Sales Promotion Incentive to buy


LO1

Sales Promotion

ConsumerSales

Promotion

ConsumerSales

Promotion

Trade Sales

Promotion

Trade Sales

Promotion

Consumer market

Marketing channel

Drive immediate purchaseInfluence behavior

Goal


LO1

Objectives of Sales Promotion

Type of BuyerType of Buyer

Loyal Customers

Competitor’sCustomers

Brand Switchers

Price Buyers

Desired ResultsDesired Results

•Reinforce behavior• Increase consumption•Change purchase timing

•Break loyalty•Persuade to switch

•Persuade to buy your brand more often

•Appeal with low prices•Supply added value

Sales PromotionSales PromotionExamples Examples

•Loyalty marketing•Bonus packs

•Sampling•Sweepstakes, contests, premiums

•Price-lowering promotion•Trade deals

•Coupons, price-offpackages, refunds•Trade deals


REVIEW LEARNING OUTCOMELO1

The Objectives of Sales Promotion


Tools for Consumer Sales Promotion

LO2

Coupons and RebatesCoupons and Rebates

PremiumsPremiums

Loyalty Marketing ProgramsLoyalty Marketing Programs

Contests & SweepstakesContests & Sweepstakes

SamplingSampling

Point-of-Purchase PromotionPoint-of-Purchase Promotion



LO2

CouponCoupon

RebateRebate

PremiumPremium

A certificate that entitles consumers to an immediate

price reduction.

A certificate that entitles consumers to an immediate

price reduction.

A cash refund given for the purchase of a product during

a specific period.

A cash refund given for the purchase of a product during

a specific period.

An extra item offered to the consumer, usually in exchange

for some proof of purchase.

An extra item offered to the consumer, usually in exchange

for some proof of purchase.



LO2

LoyaltyMarketingProgram

LoyaltyMarketingProgram

A promotional program designed to build long-term, mutually beneficial relationships between a company and key customers.

A promotional program designed to build long-term, mutually beneficial relationships between a company and key customers.

FrequentBuyer

Program

FrequentBuyer

Program

A loyalty program in which loyal consumers are rewarded for making multiple purchases.

A loyalty program in which loyal consumers are rewarded for making multiple purchases.



LO2

ContestsContests Promotions that require skill or ability to compete for prizes.

Promotions that require skill or ability to compete for prizes.

SweepstakesSweepstakes Promotions that depend on chance or luck, with free participation.

Promotions that depend on chance or luck, with free participation.

Online

http://www.sweepstakesonline.com



LO2

SamplingSamplingA promotional program that allows the consumer the opportunity to try a product or service for free.

A promotional program that allows the consumer the opportunity to try a product or service for free.


Methods of Sampling

LO2

Direct mailDirect mail

Door-to-door deliveryDoor-to-door delivery

Packaging with another productPackaging with another product

Retail store demonstrationRetail store demonstration


Point-of-Purchase Promotion

LO2

Build traffic

Advertise the product

Induce impulse buying


Online Sales Promotion

LO2

Effective Types of Online Sales PromotionEffective Types of Online Sales Promotion

Free merchandise

Sweepstakes

Free shipping with purchases

Coupons



Consumer Sales Promotion

Coupons and rebates

Premiums

Loyalty marketing programs

Contests

Sampling

P-O-P

Online


Trade Sales PromotionLO3

Trade AllowancesTrade Allowances

Push MoneyPush Money

TrainingTraining

Free MerchandiseFree Merchandise

Store DemonstrationStore Demonstration

Conventions & Trade ShowsConventions & Trade Shows


Trade AllowanceLO3

TradeAllowance

TradeAllowance

A price reduction offered

by manufacturers to

intermediaries, such as

wholesalers and retailers.


Push MoneyLO3

Push MoneyPush MoneyMoney offered to channel

intermediaries to encourage

them to “push” products--

that is, to encourage other

members of the channel to

sell the products.


Benefits of Trade PromotionsLO3

Help manufacturers gain new distribution

Obtain wholesaler and retailer support forconsumer sales promotions

Build or reduce dealer inventories

Improve trade relations



Forms of Trade Sales Promotion


LO4

Personal Selling

Personal Selling is more important if...

Customers are concentrated.

Customers are concentrated.

Product is technically complex.

Product is technically complex.

There are few customers.There are few customers.

Product is custom made.Product is custom made.

Product has a high value.Product has a high value.

Customers are geographically dispersed.

Customers are geographically dispersed.

Product is simple to understand.

Product is simple to understand.

There are many customers.There are many customers.

Product is standardized.Product is standardized.

Product has a low value.Product has a low value.

Advertising & Sales Promotion are more important if...



Personal Selling

Detailed explanation or demonstration

Variable sales message

Directed to qualified prospects

Controllable adjustable selling costs

More effective than other promotion in obtaining sale and gaining customer satisfaction

PersonalSelling

Advantages

PersonalSelling

Advantages


Relationship Selling

LO5

A sales practice that involves building, maintaining, and enhancing interactions with customers in order to develop long-term satisfaction through mutually beneficial partnerships.

Relationship(Consultative)

Selling

Relationship(Consultative)

Selling


Traditional Selling and Relationship Selling

TraditionalTraditionalPersonal SellingPersonal Selling

LO5

Sell advice, assistance, counsel Sell products

Focus on closing sales

Limited sales planning

Discuss product

Assess “product-specific” needs

“Lone wolf” approach

Pricing/product focus

Short-term sales follow-up

Focus on customer’s bottom line

Sales planning is top priority

Build problem-solving environment

Conduct discovery in scope of operations

Team approach

Profit impact and strategic benefit focus

Long-term sales follow-up

Relationship SellingRelationship Selling



Relationship Selling vs. Traditional Selling

InitialSales

RepeatSales

SuccessiveSales

Traditional Sales

Relationship Sales

SalesIncreasesResultFromCreatingValue


Steps in the Selling Process

LO6

Generate LeadsGenerate Leads

Qualify LeadsQualify Leads

Probe Customer NeedsProbe Customer Needs

Develop SolutionsDevelop Solutions

Handle ObjectionsHandle Objections

Close the SaleClose the Sale

Follow UpFollow Up


Time Spent in Key Steps of Selling Process

LO6

Key Selling StepsTraditional

Selling

Relationship

Selling

Generate Leads High Low

Qualify Leads Low High

Probe Needs Low High

Develop Solutions Low High

Handle Objections High Low

Close the sale High Low

Follow-up Low High


Generating Leads

LO6

AdvertisingAdvertising PublicityPublicity Direct Mail/TelemarketingDirect Mail/

Telemarketing

Cold CallingCold Calling Internet Web SiteInternet Web Site ReferralsReferrals

Trade Shows/Conventions

Trade Shows/ConventionsNetworkingNetworking Company

RecordsCompany Records

Online

http://www.linkedin.comhttp://www.ryze.com


Cold Calling

LO6

A form of lead generation in which

the salesperson approaches

potential buyers without any prior

knowledge of the prospects’ needs

or financial status.

Cold CallingCold Calling


Qualifying Leads

LO6

Receptivity andaccessibility

Receptivity andaccessibility

Buying powerBuying power

Recognized needRecognized need


Needs Assessment

LO6

A determination of the

customer’s specific needs

and wants and the range of

options a customer has for

satisfying them.

NeedsAssessment

NeedsAssessment


The Consultative Salesperson

LO6

Product or serviceProduct or service

CustomersCustomers

CompetitionCompetition

IndustryIndustry

Salesperson must knoweverything

about...

Salesperson must knoweverything

about...

Online

http://www.hoovers.comhttp://www.dnb.com


Developing and Proposing Solutions

LO6

Sales ProposalSales Proposal

Sales PresentationSales Presentation


Powerful Presentations

LO6

Be well prepared

Use eye contact

Ask open-ended questions

Be poised

Use hand gestures and voice inflection

Focus on the customer needs

Incorporate visual elements

Know how to operate the A/V equipment

Make sure the equipment works

PRACTICE, PRACTICE, PRACTICE!


Handling Objections

LO6

View objections as requests for information

Anticipate specific objections

Investigate the objection with the customer

Be aware of competitors’ products

Stay calm

Use the objection to close the sale


Closing the Sale

LO6

NegotiateNegotiate

Keep an open mindKeep an open mind

Look for customer signals

Look for customer signals

Tailor to each marketTailor to each market


Biz Flix

LO6 Family Man


LO6

The Impact of Technology on Personal Selling

Cell phonesCell phones

LaptopsLaptops

PagersPagers

E-MailE-Mail

Electronic organizersElectronic organizers

InternetInternet



Steps in the Selling Process

Chapter 16Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared.

Documents