Principles of Marketing

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Principles of Marketing

• Promotion Overview and Personal Selling

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Promotion Mix

• Personal Selling
• Advertising
• Publicity
• Sales Promotion

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Elements in the Communication Process (Fig. 14.2)
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Promotion Strategy

• Strategic Objectives
• Appropriate Tasks
• Budget
• Implementation
• Evaluation and Control

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Strategic Issues

• Integration
• Relationships
• Goals Information, Persuasion, Reminder
• Consumer Considerations AIETA Model
• Target

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Integrated Marketing Communications (Fig. 14.1)
Personal selling
Advertising
Sales promotion
Public relations
Direct marketing
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A View of the Communications Process
Marketers View Communications as the Management
of the Customer Relationship Over Time Through
the Following Stages
Preselling
Selling
Post- Consumption
Consuming
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AIETA

• The Adoption Process
• Product Life Cycle

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AIETA and the Promotion Mix The right tool for
the job.
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Promotion TargetsPush/Pull
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Promotion Mix Strategies
Strategy Selected Depends on Type of
Product-Market Product Life-Cycle Stage

Push Strategy
Pull Strategy
Strategy that Calls for Spending A Lot on
Advertising and Consumer Promotion to Build Up
(Pull) Consumer Demand.
Strategy that Calls for Using the Salesforce and
Trade Promotion to Push the Product Through the
Channels.
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Setting the Total Promotion Budget
One of the Hardest Marketing Decisions Facing a
Company is How Much to Spend on Promotion.
Affordable
Based on What the Company Can Afford
Percentage of Sales Based on a Certain
Percentage of Current or Forecasted Sales
Objective-and-Task Based on Determining
Objectives Tasks, Then Estimating Costs
Competitive-Parity Based on the
Competitors Promotion Budget
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Objective and Task Method
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Example of Objective and Task Budgeting
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Sales Management and Personal Selling

• Strategic objectives
• Awarenessmentions, samples, etc.
• Interestbenefit information, missionary
• Evaluationconsultative selling
• Trialconsultative selling (closing)
• Adoptionconsultative selling

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The Role of the Sales Force

• Personal selling is effective because salespeople
  can
• probe
• adjust
• negotiate
• build

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Major Steps in Sales Force Management (Fig. 16.1)
Designing Salesforce Strategy and Structure
Recruiting and Selecting Salespeople
Training Salespeople
Compensating Salespeople
Supervising Salespeople
Evaluating Salespeople
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Some Traits of Good Salespeople
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Selecting Salespeople
Sales Aptitude
Selection Process Usually Evaluates a Persons
Other Characteristics
Analytical and Organizational Skills
Personality Traits
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Sales Force Organization

• In-house Agents (Mfr. Reps)

Flexible Directed Low variable costs Simple Low fixed costs
Resource drain High fixed costs Less control High variable costs
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Designing Sales Force Strategy and Structure
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Sales Force Size

• productive and expensive assets
• shrinking in size
• workload approach

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Sales force size

• Increases with
• Decreases with

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Training Salespeople
Understand Field Procedures and Responsibilities
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Compensating Salespeople
Fringe Benefits Provide Job Security and
Satisfaction
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Supervising Salespeople

• Motivating Salespeople
• Organizational Climate
• Sales Quotas
• Positive Incentives
• Sales Meetings
• Sales Contests
• Honors and Trips
• Merchandise/ Cash

• Directing Salespeople
• Identify Customer Targets Call Norms
• Develop Prospect Target
• Use Sales Time Efficiently
• Annual Call Plan
• Time-and-Duty Analysis
• Sales Force Automation

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How Salespeople Spend Their Time (Fig. 16.2)
Administrative
Service Calls
Tasks
Companies Look For Ways to Increase the Amount of
Time Salespeople Spend Selling.
12.7
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Telephone
Selling
25.1
Face-to-Face
Selling
28.8
Waiting/
Traveling
17.4
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Evaluation

• Match the measures with the objectives
• Profit
• Sales
• Satisfaction
• New products
• New accounts
• Costs

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Steps in the Selling Process
Prospecting
Salesperson Identifies Qualified Potential
Customers.
Qualifying
Process of Identifying Good Prospects and
Screening Out Poor Ones.
Preapproach
Salesperson Learns as Much as Possible About a
Prospective Customer Before Making a Sales Call.
Approach
Salesperson Meets the Buyer and Gets the
Relationship Off to a Good Start.
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Steps in the Selling Process
Presentation
Salesperson Tells the Product Story to the
Buyer Using the Need-Satisfaction Approach.
Handling Objections
Salesperson Seeks Out, Clarifies, and Overcomes
Customer Objections to Buying.
Closing
Salesperson Asks the Customer for an Order.
Follow-Up
Occurs After the Sale and Ensures Customer
Satisfaction and Repeat Business.
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SPIN Selling

• Professional selling
• Preliminaries are not important
• Questions/Answers
• SPIN
• Situation
• Problems
• Implications
• Needs-Payoffs

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SPIN selling Easiflo
S Do you use Contortomat machines? B Yes,
three of them. S And, are they difficult for
your operators to use? B Yes, rather hard, but
they eventually learn. S We could solve that
operating difficulty with our new Easiflo
system. B What does your system cost? S The
basic system is about 120,000, and B
120,000!!! Just to make a machine easier to
use? You must be kidding!
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Example Selling Easiflo
S Do you use Contortomat machines?
(Situation) B Yes, three of them. S And, are
they difficult for your operators to
use? (Problem) B Yes, rather hard, but they
eventually learn. (Implied need) S We could
solve that operating difficulty with our new
Easiflo system. (Solution) B What does your
system cost? S The basic system is about
120,000, and B 120,000!!! Just to make a
machine easier to use? You must be kidding!
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SPIN selling Easiflo
S And, are they difficult for your operators to
use? B Yes, rather hard, but they eventually
learn. S You say theyre hard to use. What
effect does this have on your output?
(Implication) B Not much. Weve specially
trained three people. S If youve only got
three people who can use the Contortomats,
doesnt that create bottlenecks? (Implication) B
No, really, its only when an operator leaves
that we have trouble. While were waiting for a
replacement to be trained.
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S It sounds like the difficulty of using the
Contortomat machines may be causing a turnover
problem with operators. Is that right?
(Implication) B Yes, people dont like using
them, so operators usually dont stay with us
long. S What does this turnover mean in terms
of training costs? (Implication) Well, it takes a
couple months to get proficientthats maybe
4000 in wages. Plus we pay Contortomat 500 for
training. And, 1000 for travel, since that
training is off-site. Hey, thats about 5000
perand weve trained at least five this year.
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S So, thats 25,000 in training costs in less
than 6 months. If youve trained that many
people in so little time, the turnover must
result in production losses, doesnt it?
(Implication) B Not really. As I said, we
avoid bottlenecks by getting the other operators
to work overtime. Or, we send the work out. S
Doesnt the overtime add even more to your costs?
(Implication) B Yes, thats true. And, even at
double pay, the operators dont like working it.
That probably contributes to the turnover.
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S I can see how sending the work outside must
increase your costs, but are there other
implications? Does the quality stay the same?
(Implication) B Thats actually the biggest
problem. I can control the quality in house, but
not the contract stuff. S I suppose that
sending work out puts you at the mercy of the
contractors schedule? (Implication) B You
dont want to know! I just got off the
phonethree hours, chasing down a late delivery.
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S So, from what youve said, because the
Contortomats are difficult to use, youve spent
25,000 in training costs this year and youre
getting expensive operator turnover. Youve got
bottlenecks in production, and they result in
expensive overtime and force you to send jobs
outside. But sending jobs outside reduces
quality and creates scheduling problems. B When
you look at it that way, those Contoromat
machines are creating a very serious problem
indeed.
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Wrong approach

• Contortomats are hard to use.

• 120,000 is far too much money to solve that
  problem

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SPIN approach

• Contortomats cause
• Difficulty in use
• 25,000 training
• Turnover
• Overtime costs
• Cost of outside work
• Loss of quality
• Scheduling problems

• 120,000 may be a bargain

Build implications. Let the customer discover
value.