Title: Ethical dilemma (p. 51)
1Ethical dilemma (p. 51)
- The personal computer business unit of Modern
Tech is reaching the end of its fiscal year and
is very close to meeting its sales growth
objective. Herb Smith, your sales manager, is
rallying the troops to get over the top so
everyone can earn a substantial performance
bonus. You are motivated to do your share. Your
first call today is to ABC. ABC purchased a
number of computers from you last year. Mary,
purchasing manager at ABC, indicates that her IT
people want to upgrade these computers. You know
this sale could be critical to meeting your quota
and the business units sales growth objective.
However, you also know that a new, more powerful
PC will be available in 3 months. This new
personal computer is exactly what ABC needs, but
the sale cannot be made until after the fiscal
year ends.
2Organizational Strategiesand The Sales Function
3The Importance of TrustAn Experts Viewpoint
Franciscan Estates consists of seven winery
estates based in California. Using the
traditional sales strategy of working through
distributors, the company had little information
about product or customer sales beyond the
distributor level. The company developed a
customer relationship management (CRM) strategy
to establish different types of relationships
with different customers at different levels.
4channels
- Franciscan Estates makes wine
- 300 distributors worldwide
- restaurants
- consumers
5The Importance of TrustAn Experts Viewpoint
The sales organization uses this information to
strengthen relationships with existing accounts
and to prioritize sales efforts to existing and
new customers . . . . . . Franciscan Estates has
used it CRM strategy and technology to develop a
competitive advantage for its marketing and
selling efforts.
6Organizational Strategy Levels
7Mission statements
- We aim to be a global organization that
constantly stays a step ahead in dealing with
change, creates new value, and contributes
broadly to society. Sumitomo - To provide clients with Expertise, Leading Edge
Technology and Quality Products that will produce
Maximum Drilling Program Efficiency and
Environmental Care. Genesis Internat. Oilfield
Services - Our product SERVICE. Our value-added FINANCIAL
ADVICE. Our competitive advantage OUR PEOPLE.
Vision and values of WellsFargo
8Organizational Strategy Levels
9Definition ofStrategic Business Units (SBUs)
10Change at the top
- In the early 1980s, the information technology
(IT) world revolved around the product offerings
of the Big 4 - IBM
- Digital Equipment Corporation (DEC)
- Burroughs
- Data General
-
- In office automation including word-processing,
Wang Computers and Lanier dominated. - Only IBM remains as a major firm
- in these markets.
11SBU Objectives andthe Sales Organization
Salary plus incentive
Prospective and new accounts Provide high service
levels particularly pre-sales service Product/mark
et feedback
Build sales vol. Secure distribution
Build
12Salary, bonus, incentive
- A bonus is a lump-sum payment for an above-normal
performance - A bonus must always be combined with salary
and/or commission - incentive means commission
- Siebel Systems in 2001 paid a base salary plus
commissions plus a quarterly bonus based on
customer satisfaction surveys for each rep
13SBU Objectives andthe Sales Organization
Salary plus commission or bonus
Call on targeted current accounts Incr. service
levels to current accounts Call on new accounts
Maintain sales vol. Consolidate market position
through concentration on targeted segments Secure
additional outlets
Hold
14SBU Objectives andthe Sales Organization
Salary plus bonus
Service most profitable accounts eliminate
unprofitable accounts Reduce service
levels Reduce inventories levels
Reduce selling costs Target profitable accounts
Harvest
15SBU Objectives andthe Sales Organization
Salary
Dump inventory Eliminate service
Minimize selling costs and clear out inventory
Divest or Liquidate
16Business Strategy andthe Sales Function
Strategy Type
Sales Force Role
Pursue large customers Minimize cost Compete on
price Seek customers who are low price shoppers
17Business Strategy andthe Sales Function
Strategy Type
Sales Force Role
Compete on non-price benefits Provide high
quality customer service Seek customers who are
not low price shoppers
- Low-cost supplier
- Differentiation
18Business Strategy andthe Sales Function
Strategy Type
Sales Force Role
Serve a distinct target market not served well by
others Provide high quality customer service Seek
customers who are not low price shoppers
- Low-cost supplier
- Differentiation
- Niche
19Marketing Strategy andthe Sales Function
- Advantages
- Only promotional tool that consists of personal
communication between seller and buyer - More credible and has more impact
- Better timing of message delivery
- Ability to tailor message to buyer
- Allows for sale to be closed
- Disadvantage
- High cost per contact
20Personal Selling-Driven vs. Advertising-DrivenMar
keting Communications Strategies
Personal Selling
When Message Flexibility is Important When
Message Timing is Important When Reaction Speed
is Important When Message Credibility is
Important When Trying to Close the Sale
When Low Cost per Contact is Important When
Repetitive Contact is Important When Control of
Message is Important When Audience is Large
Advertising
21Target Market Situations andPersonal Selling
- Target Market
- A definition of the specific market segment to be
served - Personal Selling-Driven Promotional Strategies
are appropriate when - The market consists of only a few buyers that
tend to be concentrated in location - The buyer needs a great deal of information
- The purchase is important
- The product is complex
- Service after the sale is important
22Integrated Marketing CommunicationsIMC
23The Sales Strategy Framework
24Organizational Buyer BehaviorTypes of
Organizations
Users purchase products and services to produce
other products and services
Original Equipment Manufacturers (OEM) purchase
products to incorporate into products
Resellers purchase products to sell
25Organizational Buyer BehaviorTypes of
Organizations
Federal, State, and Local Government Agencies
Government Organizations
Public and Private Institutions
Institutions
26Organizational Buyer Behavior Buying Situations
- Straight Rebuy Buying Situation
- Routinized Response Behavior
- Modified Rebuy Buying Situation
- Limited Problem Solving
- New Task Buying Situation
- Extensive Problem Solving
27Organizational Buyer Behavior Buying Center
- Initiators
- Users
- Gatekeepers
- Influencers
- Deciders
- Purchasers
28Organizational Buyer BehaviorBuying Process
- Phase 1 Recognize Problem/Need
- Phase 2 Determine Item Specs/Quantity Needed
- Phase 3 Specify Item Specs/Quantity Needed
- Phase 4 Identify and Qualify Potential Sources
- Phase 5 Acquire and Analyze Proposals
- Phase 6 Evaluate Proposals/Select Suppliers
- Phase 7 Selection of Order Routine
- Phase 8 Performance Feedback/Evaluation
29Personal and Organizational Needs
30Sales StrategyAccount-Targeting Strategy
- The classification of accounts withina target
market into categories forthe purpose of
developing strategic approaches for selling to
each account or account group.
31Sales StrategyRelationship Strategy
- A determination of the type of relationship to be
developed with different account groups.
32Characteristics of Relationship Strategies
33Sales Strategy Selling Strategy
- Ensuring that accounts receive selling effort
coverage in an effective and efficient manner.
34Matching Selling andRelationship Strategies
35Sales Strategy Sales Channel Strategy ensuring
that accounts receive selling effort coverage
efficiently and effectively
- The planned selling approach for each
relationship strategy. Use one or more these - The Internet
- Industrial Distributors
- Independent Representatives
- Team Selling
- Telemarketing
- Trade Shows
36Sales Strategy The Internet
- Increase Reach
- Gather Information about Customers
- Showcase New Products
- Conduct Surveys
- Enhance Corporate Image
- Obtain Feedback
- Service Existing Customers
37Sales Channel StrategyIndustrial Distributors
- Have Their Own Sales Force
- May Represent One Manufacturer Several
Non-competing Manufacturers Several Competing
Manufacturers - Normally Carry Inventory
38Sales Strategy Independent or Manufacturers
Reps
- Sell complementary products from non-competing
manufacturers. - Do Not Normally Carry Inventory
- Paid for Performance (commission)
- Reduced Control over Selling Effort
- Reduced Access to Customer Information
39Independent sales firm
- You want to expand and increase your customer
base, but you need sales people to do it. And you
can't hire sales people until you are making
revenues from a larger customer base. - The most common solution is to hire an
independent sales company, or rep firm
40Rep firm
- The rep firm will work on commission-only, but
the reps will not work just for you -- they will
represent several different companies and sell
whoever's product or service seems the best match
for the customer
41Fixed costs..Variable costs
42Sales Strategy Team Selling
- Three Selling Situations
- New Task Selling
- Modified Resell Selling Situation
- Routine Resell Selling Situation
- Two Types of Team Selling
- Multilevel Selling
- Major Account Selling
43Sales Strategy Telemarketing
- May replace field sales force for certain
accounts - When integrated with field sales force,
activities include - Prospecting, Qualifying Leads, Conducting Surveys
- Taking Orders, Checking on Order Status, Handling
Order Problems - Following Up for Repeat Business
44Sales Strategy Trade Shows
- Generate Leads
- Test Market New Products
- Introduce New Products
- Close Sales
- Gather Competitive Information
- Service Existing Customers
- Enhance Corporate Image
45Enhancing the brand
- Trade shows are an excellent place to enhance the
brand because of the personal contact that can
occur. - Even with all the emailing and Internet
communication most customers crave the personal
contact of a sales call and conversation at a
trade show.
46Enhancing the brand
- All the personalization efforts on the best
interactive web sites cannot come close to the
experience of a personal contact. - The larger the purchase the more the need to have
some personal contact. - The more complex the transaction the more need
for personal contact.
47Integrating the trade show
- Use the Internet to support your relationship
marketing plan. - Develop an appropriate preview of your trade show
exhibit and post it on the web about a month
before the show and leave it up for a month
afterwards. - Surveys show that more that 60 percent of
attendees use the Internet to plan their trade
show visits.
48Focus
- Before going to a trade show try to be very clear
who your market segment is and who it is not. - If top management is unclear about exactly whom
its target market is, spend some time with them
to make it clear. - Planning, executing and following up on the
results of a trade show are infinitely easier if
you have a good description of your target market
segment.
49Use the trade show
- Introducing a new brand at a trade show is often
an excellent idea because your most important
buyers and potential partners are likely to
attend and be in the right frame of mind to learn
about your new offering. - Trade shows are excellent for maintaining
awareness of the product with the primary buyers.
50Trade shows are expensive
- Average annual trade show budget in 2001
777,730 - Average pay for exhibit managers was 60k for
males and 48k for females
51Mktg dollars in B2B
Telemktg
PR
Direct mail 9
Field sales 47
Trade ads 12
Trade shows 14