Chapter Two
Adjusting to the
Dynamic
Personal Selling
Environment
PowerPoint presentation prepared by
Dr. Rajiv Mehta
Learning Objectives
After reading this chapter, you should understand:
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• Megatrends affecting personal selling.
• Adapting to megatrends.
• Professional salespeople as micromarketing managers.
• What megatrends are affecting personal
selling now and what megatrends will
affect personal selling in the foreseeable
future.
• How “online” sales channels are
empowering customers, especially giant
retailers.
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Chapter 2 | Slide 2
Learning Objectives cont’d
After reading this chapter, you should understand:
• How developments in telecommunications
technology are dramatically changing personal
selling.
• Why rising personal selling costs are
encouraging salespeople and their companies
to make increasing use of alternative directmarketing techniques.
• What current trends in information management
will affect how salespeople do their jobs.
• Why today’s professional salespeople need to
be much like micro-marketing managers in their
expanding roles.
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Chapter 2 | Slide 3
Megatrends Affecting
Personal Selling
Salespeople must adapt to 3 major megatrends to enhance their
effectiveness and efficiency:
1. Behavioral forces
2. Technological forces
3. Managerial forces
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Chapter 2 | Slide 4
Megatrends: Behavioral Forces
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Chapter 2 | Slide 5
Megatrends: Behavioral Forces cont’d
•
Buyers’ attitudes, preferences, and behaviors are changing, necessitating
salespeople to modify their selling strategies and approaches.
Behavioral forces include:
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Images
•
More expert and demanding buyers
•
Rising customer expectations
•
Micro-segmentation of domestic markets
•
Expanding power of giant retailers
•
Globalization of markets
•
Empowerment of customers
Chapter Review Question:
What specific market and competitive forces are changing
personal selling and buyer-seller relationships? What are their
effects?
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Chapter 2 | Slide 6
Megatrends:
Empowerment of Customers
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Chapter 2 | Slide 7
Megatrends: Technological Forces
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Chapter 2 | Slide 8
Megatrends: Technological Forces cont’d
•
Today’s successful salespeople are those who can make skillful and efficient
use of technology to increase their efficiency and productivity in serving
customers.
Technological forces include:
•
Sales force automation
•
Virtual sales offices (home, automobile, or
virtually anywhere)
•
Electronic commerce
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Chapter Review Question:
Name some major advances in telecommunications and computer technology that are
affecting personal selling. Describe briefly how salespeople can use each to improve
their effectiveness and efficiency.
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Chapter 2 | Slide 9
Megatrends: Technological Forces cont’d
Among the most important of the technological
innovations in sales force automation include:
Sales Force Automation
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•
Portable computers
•
Electronic data interchange
•
Videoconferencing
•
Multifunction cell phones and satellite pagers
•
Voice mail and Electronic mail
•
Instant messaging
Virtual Sales Offices
•
Home
•
Office
•
Virtually
Anywhere
Electronic Commerce
•
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Internet:
•
Blogs, Podcasting
•
Screen-Sharing, WebEx
•
Intranet
•
Extranet
Chapter 2 | Slide 10
Megatrends: Managerial Forces
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Chapter 2 | Slide 11
Megatrends: Managerial Forces cont’d
•
In response to the dynamic behavioral and technological megatrends,
sales organizations are trying various strategies to achieve profitable
sales growth and closer customer relationships
Managerial forces include:
•
Efforts to reduce selling costs
•
Shift to direct marketing alternatives
•
Certification of salespeople
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Images
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Chapter 2 | Slide 12
Megatrends: Managerial Forces cont’d
Efforts to Reduce Selling Costs
•
•
•
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Median cost of a business-to-business sales
call: more than $250 (varies widely by industry
and company)
For some large industrial companies, a sales
call can cost $400 to $1,000 or more because
of the unusual complexity of both the selling
process and the product itself
To reduce selling costs, many manufacturers
and service providers are aggressively seeking
alternatives to large national sales forces (e.g.,
use of middlemen, part-time salespeople, and
direct marketing efforts).
Chapter Review Question:
What are some companies doing to reduce selling costs?
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Chapter 2 | Slide 13
Megatrends: Managerial Forces cont’d
Shift to Direct Marketing Alternatives
•
To sell to organizational
buyers, several direct
marketing alternatives support
or bypass field salespeople:
1.
2.
Direct mail
Telemarketing, which
includes:
•
Teleselling
•
Kiosks (or “computer
salespeople”)
•
Facsimile
•
Personalized email
Chapter Review
Question:
In your own words,
define the term direct
marketing. Describe
some tools and
techniques used in
direct marketing.
What is teleselling?
How have many
former field
salespeople who were
transferred to
teleselling increased
their incomes?
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Chapter 2 | Slide 14
Figure 2.1: Telemarketing Applications,
Advantages, and Disadvantages
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Chapter 2 | Slide 15
Megatrends: Managerial Forces
Certification of Salespeople
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•
Because of the public’s negativism toward
personal selling, efforts have been directed at
certifying sales personnel
•
Certification usually requires that a
salesperson:
•
•
•
•
•
Gains a certain amount of practical experience
Enrolls in educational seminars and courses
Passes a sales competency exam
Provides some professional references
Agrees to comply with a code of conduct
Chapter Review Question:
Describe the three broad megatrends affecting personal selling.
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Chapter 2 | Slide 16
Adapting to Megatrends
•
•
Salespeople and their companies
can adapt to megatrends using
various information management
tools
Behind the forces that are
influencing salespeople and the way
they operate are four key trends in
the management of information:
• (1) Database marketing
• (2) Data warehousing
• (3) Push technology
• (4) Data mining
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Chapter 2 | Slide 17
Four Major Trends in
Information Management
1.
Database marketing: A database is a large
computerized file of customers’ and potential
customers’ profiles and purchase patterns.
2.
Data warehousing: A very large, corporate-wide
database, built with data from a number of
information systems already in place in the company.
3.
Data mining: Refers to the process of using
statistical analysis to detect relevant patterns or
relationships between and among variables in a
database.
4.
Push technology: Push technology is the latest
iteration of e-mail combined with data warehousing to
discern what your customers need and exactly when
they need it.
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Chapter Review
Question:
How are
information
management
trends affecting
salespeople?
Chapter 2 | Slide 18
Information Management and
Relationship Selling
Information management and relationship selling go handin-hand as part of the evolutionary development of a
marketing strategy used in one-to-one marketing and by
salespersons as one-to-one relationship builders.
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Chapter 2 | Slide 19
Information Management and
Relationship Selling cont’d
One-to-one marketing:
Concentrates on selling more goods,
more profitably, to fewer selected
customers (instead of selling more
goods to more customers)
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Salespeople as one-to-one relationship builders:
Building trust and long-term
relationships with customers
determines the success of one-toone marketing strategies,
especially in business-to-business
markets
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Chapter 2 | Slide 20
Professional Salespeople as
Micro-Marketing Managers cont’d
•
In addition to selling products, today’s sales representatives must serve customers as
consultants by offering expert advice for making a customer’s business operations more
profitable
Salespeople offer expert advice on:
•
•
•
•
•
•
Building partnerships with their
customers
Buyer-seller team coordinators
Market analysts and planners
Customer service providers
Buyer behavior experts
Opportunity spotters
•
•
•
•
•
•
Intelligence gatherers
Sales forecasters
Marketing cost analysts
Allocators of scarce products
Field public relations people
Adopters of advanced sales
technology
Chapter Review Question:
Why must today’s professional salesperson learn to function
more like a micro-marketing manager in the field?
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Chapter 2 | Slide 21
Chapter Review Questions
1.
Why do some companies see selling in the United States as
increasingly like selling internationally?
2.
Describe the type of assistance that salespeople may receive from
the company’s telemarketing staff. What can field salespeople do to
increase the benefits they derive from telemarketers?
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Chapter 2 | Slide 22
Topics for Thought and
Class Discussion
1. Which of the advances in telecommunications and
computer technology do you think will provide the most
help to salespeople over the next decade?
2. Discuss how you think salespeople can take
advantage of each of the phenomena taking place
under the managerial megatrend.
3. How do you think the rising cost of personal selling
and the growth of direct-marketing techniques will
affect salespeople?
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Chapter 2 | Slide 23
Internet Exercises
1. Many major companies sell more products and services
online via e-commerce than they do in traditional brickand-mortar stores or outlets. Check out the websites of
each of the following companies and see whether they
offer purchasing options online. Also, try to find out their
dollar sales volumes online and off-line compare.
• Cisco Systems (www.cisco.com)
• Williams-Sonoma (www.williams-sonoma.com)
• Pitney Bowes (www.pitneybowes.com)
• Staples (www.staples.com)
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Chapter 2 | Slide 24
Internet Exercises cont’d
2. Salespeople need to keep up with the latest technologies (including
computer software) that might affect how they do their sales jobs. Go
to the following websites, or to other professional selling-related
websites, and find three innovations that you think will help
salespeople become more effective and efficient. Describe these
innovations, and explain why you feel each will increase salesperson
productivity.
•
•
•
•
Sales and Marketing Management
(www.salesandmarketing.com/smm/index.jsp)
Siebel Systems (www.siebel.com)
SalesForce.com (www.salesforce.com)
SellingPower.com (www.sellingpower.com)
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Chapter 2 | Slide 25
Projects For Personal Growth
1. Assume that a firm has divided the United States into ten regional
markets based on need for its products—industrial lawn mowers,
lawn sweepers, watering equipment, and garden tools. Also
assume that the company’s CEO has asked you to prepare a map
of the United States showing these regional markets. Clearly label
each region according to how you identify it. For example, perhaps
part of the southwestern United States has different needs owing to
the terrain and desert-like environment of the area, whereas part of
Florida may be identified with abundant moisture, humidity, and
tropical plants. Do any library research necessary to complete your
map.
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Chapter 2 | Slide 26
Projects For Personal Growth cont’d
2. Ask two business-to-business salespeople about
telecommunication use in their sales work. What SFA
equipment has been most helpful to them? Why? How
have their companies assisted them in selling and in
serving prospects and customers? What other equipment
would they like? What other support would they like from
their companies in helping them work with prospects and
customers?
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Chapter 2 | Slide 27
Case 2.1: Savoring Success and
Contemplating the Future
1. Do you think the use of high-tech equipment—laptop
computers, cell phones, pagers, and the like—will help the
young saleswomen appear more professional?
2. Assume you are a friend of one of the women. What five
ideas would you give her about using the Internet and
other telecommunication tools to make her more effective
and efficient in her sales assignments?
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Chapter 2 | Slide 28
Case 2.1: Savoring Success and
Contemplating the Future cont’d
3. Are the women’s ideas about making their sales jobs
easier realistic? Which ones make the most sense?
Which ones make the least sense? Could the company
provide a lot of this information for customers on an
extranet or on the Internet?
4. Do the women have an accurate understanding of what
many salespeople are expected to do today? Why or
why not? What can the company do to help its
salespeople handle their expanded roles?
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Chapter 2 | Slide 29
Case 2.1: Savoring Success and
Contemplating the Future cont’d
5.
In their conversation, do the women seem unnecessarily concerned
about taking on their new territorial assignments? Do you think any
special issues arise for saleswomen but not for salesmen? Why or
why not?
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Chapter 2 | Slide 30
Case 2.2: We’re Trying To Cut Costs ...
We Can’t Afford Laptops Now!
1. Which customers would you advise Russ to call on with
Homer?
2. What should Russ say to Homer about purchasing
laptop computers for the full-time sales force? Do you
think S&B should buy laptop computers for the fifteen
manufacturers’ reps, too? Would any other equipment
aid personal selling at S&B? If so, should S&B be asked
to purchase it for the salespeople?
3. How might Russ recommend buying laptop computers
without Homer seeing it as running counter to S&B’s
current cost-reduction push? Will the laptops pay off for
S&B? Could the company expand its markets through
the use of computers and email?
Case 2.2 is found online at http://college.hmco.com/pic/andersonps2e.
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Chapter 2 | Slide 31
Case 2.2: We’re Trying To Cut Costs ...
We Can’t Afford Laptops Now! cont’d
4.
Do you think Russ should consider looking for another job now?
Why or why not?
5.
If Homer were to retire and recommend Russ as his successor,
what actions would you advise for Russ if he became S&B’s
regional sales manager? How else, besides making field sales
calls, might S&B reach prospects and customers? How well would
the current salespeople accept your suggestions? How would you
address their concerns?
6.
What other situations and possible questions should Russ prepare
for during his five days traveling with Homer?
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Chapter 2 | Slide 32