17
CHAPTER
Personal Selling and
Sales Promotion
Chapter Objectives
1 Describe the role of today’s 4 Identify and briefly
7 Identify the role of ethical
salesperson.
describe the three basic
behavior in personal
sales tasks.
selling.
2 Describe the four sales
5 Outline the seven steps in 8 Describe the role of sales
channels.
the sales process.
promotion in the
3 Describe the major trends
promotional mix, and
in personal selling.
6 Identify the seven basic
identify the different
functions of a sales
types of sales promotions.
manager.
CHAPTER 17 Personal Selling and Sales Promotion
• Personal selling Interpersonal influence process involving a seller’s
promotional presentation conducted on a person-to-person basis with the
buyer.
• Sixteen million people in the U.S. are employed in sales.
• Personal selling is the single largest marketing expense in many firms.
CHAPTER 17 Personal Selling and Sales Promotion
THE EVOLUTION OF PERSONAL SELLING
• Salespeople are problem solvers who focus on meeting customers’ needs
before, during, and after the sale.
• Must be able to do the following:
• Focus on customers’ needs and problems, and offer solutions.
• Follow through with phone calls and other communications.
• Develop expertise about their industry and product.
• Go the extra mile to fulfill customers’ needs beyond their
expectations.
• Bureau of Labor Statistics predicts that jobs in sales will grow by 10
percent over the next decade.
CHAPTER 17 Personal Selling and Sales Promotion
THE FOUR SALES CHANNELS
• Channels all include both business-to-business and
direct-to-customer selling.
• Over-the-counter selling Personal selling conducted
in retail and some wholesale locations in which customers
come to the seller’s place of business.
• Field selling Sales presentations made at prospective
customers’ locations on a face-to-face basis.
• Telemarketing Promotional presentation involving the use of the
telephone on an outbound basis by salespeople or on an inbound basis by
customers who initiate calls to obtain information and place orders.
• Inside selling Selling by phone, mail, and electronic commerce.
• Firms generally blend sales channels in their sales organization.
CHAPTER 17 Personal Selling and Sales Promotion
TRENDS IN PERSONAL SELLING
• Companies rely on three major personal selling approaches
to meet customer needs.
• Relationship selling Regular contacts between sales
representatives and customers over an extended period to
establish a sustained buyer-seller relationship.
• Consultative selling Meeting customer needs by listening
to them, understanding their problems, paying attention to
details, and following through after the sale.
• Team selling Selling situation in which several sales associates or other
members of the organization are recruited to help the lead sales
representative reach all those who influence the purchase decision.
CHAPTER 17 Personal Selling and Sales Promotion
SALES TASKS
• Ensuring that buyer’s purchases are in his or her best interest aids the
development of long-term relationships.
• Selling involves three basic tasks:
• Order processing Selling, mostly at the wholesale and retail levels, that
involves identifying customer needs, pointing them out to customers, and
completing orders.
• Creative selling Personal selling that involves situations in which a
considerable degree of analytical decision making on the buyer’s part results
in the need for skillful proposals of solutions for the customer’s needs.
• Missionary selling Indirect type of selling in which specialized
salespeople promote the firm’s goodwill among indirect customers, often by
helping customers use products.
CHAPTER 17 Personal Selling and Sales Promotion
CREATIVE SELLING
• Creative selling Personal selling that involves situations in
which a considerable degree of analytical decision making on
the buyer’s part results in the need for skillful proposals of
solutions for the customer’s needs.
• Generally used to develop new business with either new
customers of new products for existing customers.
MISSIONARY SELLING
• Missionary selling Indirect type of selling in which
specialized salespeople promote the firm’s goodwill among
indirect customers, often by helping customers use products.
• Example: Pharmaceutical companies that use free samples,
educational seminars to court doctors.
• May involve both field selling and telemarketing.
CHAPTER 17 Personal Selling and Sales Promotion
THE SALES PROCESS
• Steps follow the AIDA concept.
Attention
Interest
Desire
Action
CHAPTER 17 Personal Selling and Sales Promotion
PROSPECTING AND QUALIFYING
• Prospecting—identifying potential customers.
• Qualifying—determining that the prospect really is a potential customer.
APPROACH
• Initial contact with prospective customer.
• Use precall planning research to identify how your products might
best meet customer’s needs.
PRESENTATION
• Conveying marketing message to the customer.
• Features-benefits framework focuses on the good or service in terms that
are meaningful to the buyer.
CHAPTER 17 Personal Selling and Sales Promotion
DEMONSTRATION
• Buyer has a chance to try a product or see how it works.
HANDLING OBJECTIONS
• Expressions of resistance, such as stalling or indecision, by the prospect are
an opportunity to reassure the buyer or offer suitable alternatives.
CLOSING
• Point at which salesperson asks the prospect for an order.
• Let buyer know you are ready to be of service in the future.
FOLLOW-UP
• Successful sales people turn today’s customers into tomorrow’s by
reinforcing the purchase decision.
• Ensure that customer service needs are met.
CHAPTER 17 Personal Selling and Sales Promotion
MANAGING THE SALES EFFORT
• Sales managers mix sales and management skills to manage the overall
direction and control of the personal selling effort.
RECRUITMENT AND SELECTION
• Important because of company investment in the hiring process and the
potential damage to customer relationships and overall performance.
TRAINING
• Primary methods are on-the-job training, individual instruction, how-to
classes, and external seminars; often ongoing for experienced salespeople.
ORGANIZATION
• National accounts organization—assigning senior sales personnel or sales
teams to major accounts in each market.
CHAPTER 17 Personal Selling and Sales Promotion
SUPERVISION
• Span of control—number of sales representatives who report to first-level
sales managers.
MOTIVATION
• Tools include information sharing, recognition, bonuses, and benefits.
• Expectancy theory—motivation depends on the expectations an individual
has of his or her ability to perform the job and on how performance relates
to attaining rewards that the individual values.
COMPENSATION
• Commission—compensation tied directly to the sales or profits the
salesperson achieves.
• Salary—fixed payment made periodically to an employee.
• Many firms combine the features of both commission and salary in their
compensation programs.
CHAPTER 17 Personal Selling and Sales Promotion
EVALUATION AND CONTROL
• Managers must set standards and choose the best methods for measuring
sales performance.
• Sales quotas—specified sales or profit targets that the firm expects
salespeople to achieve.
• Other measures include customer satisfaction, profit contribution, share of
product-category sales, and customer retention.
• Evaluations should motivate improved performance.
CHAPTER 17 Personal Selling and Sales Promotion
ETHICAL ISSUES IN SALES
• Long-term success requires strong code of ethics.
• Honesty and ethical behavior is encouraged when:
• Employees understand what is expected of them.
• Open communication is encouraged.
• Managers lead by example.
CHAPTER 17 Personal Selling and Sales Promotion
SALES PROMOTION
• Sales promotion Marketing activities other than personal selling,
advertising, and publicity that enhance consumer purchasing and dealer
effectiveness.
• Goal is speeding the sales process and increasing sales volume.
• Produce best results when combined with other other marketing activities,
such as advertising.
• Cannot overcome poor brand images, product deficiencies, or poor training
for salespeople.
CONSUMER-ORIENTED SALES PROMOTIONS
• Goals: Encourage repurchases by rewarding current users, boost sales of
complementary products, and increase impulse purchases.
• Coupons—most widely used form of sales promotion.
CHAPTER 17 Personal Selling and Sales Promotion
• Refunds or rebates—help packaged-goods companies increase purchase
rates, promote multiple purchases, and reward product users.
• Samples, bonus packs, and premiums—a “try it, you’ll like it” approach.
• Contests—require entrants to complete a task such as solving a puzzle or
answering questions in a trivia quiz.
• Sweepstakes—choose winners by chance; no product purchase is
necessary.
• Specialty Advertising—sales promotion technique that places the
advertiser’s name, address, and advertising message on useful articles that
are then distributed to target consumers.
CHAPTER 17 Personal Selling and Sales Promotion
TRADE-ORIENTED PROMOTIONS
• Sales promotion that appeals to marketing intermediaries rather than to
final consumers.
• Accounts for half of typical firm’s promotion budget.
• Trade allowances—special financial incentives offered to wholesalers and
retailers that purchase or promote specific products.
• Point-of-purchase advertising—display or other promotion located near the
site of the actual buying decision.
• Trade shows—vendors who serve the industries display and demonstrate
their products for members.
• Dealer incentives, contests, and training programs.