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Chapter 18 Copyright ©2012 by Cengage Learning Inc. All rights reserved 1
Lamb, Hair, McDaniel
CHAPTER 18
Sales Promotion and Personal Selling
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Chapter 18 Copyright ©2012 by Cengage Learning Inc. All rights reserved 2
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
Chapter 18 Copyright ©2012 by Cengage Learning Inc. All rights reserved 3
Sales Promotion
Advertising Reason to buy
Sales Promotion Incentive to buy
LO1
Chapter 18 Copyright ©2012 by Cengage Learning Inc. All rights reserved 4
Sales Promotion
sales promotion activities targeting the ultimate consumer.
Consumer Sales Promotion is…
sales promotion activities targeting a marketing channel member, such as a wholesaler or retailer.
Trade Sales Promotion is…
Chapter 18 Copyright ©2012 by Cengage Learning Inc. All rights reserved 5
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
LO1
Chapter 18 Copyright ©2012 by Cengage Learning Inc. All rights reserved 6
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
Online Sales PromotionOnline Sales Promotion
Chapter 18 Copyright ©2012 by Cengage Learning Inc. All rights reserved 7
Coupons and Rebates
CouponCoupon
RebateRebate
PremiumPremium
A certificate that entitles consumersto an immediate price reduction when
they buy the product.
A certificate that entitles consumersto an immediate price reduction when
they buy the product.
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 of the promoted product.
An extra item offered to the consumer, usually in exchange for some proof of
purchase of the promoted product.
LO2
Chapter 18 Copyright ©2012 by Cengage Learning Inc. All rights reserved 8
Loyalty Marketing Programs
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 of a particular good or service.
A loyalty program in which loyal consumers are rewarded for making multiple purchases of a particular good or service.
LO2
Chapter 18 Copyright ©2012 by Cengage Learning Inc. All rights reserved 9
Coupons and Sweepstakes
ContestsContestsPromotions in which participants usesome skill or ability to compete forprizes.
Promotions in which participants usesome skill or ability to compete forprizes.
SweepstakesSweepstakes Promotions that depend on chance, with free participation.
Promotions that depend on chance, with free participation.
LO2
Chapter 18 Copyright ©2012 by Cengage Learning Inc. All rights reserved 10
Sampling
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.
LO2
Chapter 18 Copyright ©2012 by Cengage Learning Inc. All rights reserved 11
Point-of-Purchase Promotion
Offers captive audience in retail stores
Can increase sales by as much as 65 percent
LO2
Chapter 18 Copyright ©2012 by Cengage Learning Inc. All rights reserved 12
Online Sales Promotion
Effective Types of Online Sales PromotionEffective Types of Online Sales Promotion
Free merchandise
Sweepstakes
Free shipping with purchases
Coupons
LO2
Chapter 18 Copyright ©2012 by Cengage Learning Inc. All rights reserved 13
Trade Sales Promotion
Trade AllowancesTrade Allowances
Push MoneyPush Money
TrainingTraining
Free MerchandiseFree Merchandise
Store DemonstrationStore Demonstration
Conventions & Trade ShowsConventions & Trade Shows
LO3
Chapter 18 Copyright ©2012 by Cengage Learning Inc. All rights reserved 14
Advantages of Personal Selling
Provides detailed explanation/demonstration of product
Message can be varied according to motivations of each customer
Can be directed only to qualified prospects
Most effective promotion form in obtaining sale and satisfying customer
Chapter 18 Copyright ©2012 by Cengage Learning Inc. All rights reserved 15
LO4
Exhibit 18.2Exhibit 18.2Comparison of Personal Selling and Comparison of Personal Selling and Advertising/Sales PromotionAdvertising/Sales Promotion
Chapter 18 Copyright ©2012 by Cengage Learning Inc. All rights reserved 16
Relationship Selling
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
LO5
Chapter 18 Copyright ©2012 by Cengage Learning Inc. All rights reserved 17
LO5
Exhibit 18.3Exhibit 18.3Key Differences between Traditional Selling Key Differences between Traditional Selling and Relationship Sellingand Relationship Selling
SOURCE: Robert M. Peterson, Patrick L. Schul, and George H. Lucas, Jr., “Consultative Selling: Walking the Walk in the New Selling Environment,” National Conference on Sales Management, Proceedings, March 1996.
Chapter 18 Copyright ©2012 by Cengage Learning Inc. All rights reserved 18
Steps in the Selling Process
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
LO6
Chapter 18 Copyright ©2012 by Cengage Learning Inc. All rights reserved 19
Generating Leads
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
LO6
Chapter 18 Copyright ©2012 by Cengage Learning Inc. All rights reserved 20
Cold Calling
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
LO6
Chapter 18 Copyright ©2012 by Cengage Learning Inc. All rights reserved 21
Qualifying Leads
Receptivity andaccessibility
Receptivity andaccessibility
Buying powerBuying power
Recognized needRecognized need
LO6
Chapter 18 Copyright ©2012 by Cengage Learning Inc. All rights reserved 22
Approaching the Customer and Probing Needs
A determination of the
customer’s specific needs
and wants and the range of
options a customer has for
satisfying them.
NeedsAssessment
NeedsAssessment
LO6
Chapter 18 Copyright ©2012 by Cengage Learning Inc. All rights reserved 23
The Consultative Salesperson
Product or serviceProduct or service
CustomersCustomers
CompetitionCompetition
IndustryIndustry
Salesperson must knoweverything
about...
Salesperson must knoweverything
about...
LO6
Chapter 18 Copyright ©2012 by Cengage Learning Inc. All rights reserved 24
Developing and Proposing Solutions
LO6
a formal written document or professional presentation that outlines how the salesperson’s product or service will meet or exceed the prospect’s needs.
Sales Proposal is…
a formal meeting in which the salesperson presents a sales proposal to a prospective buyer.
Sales Presentation is…
Chapter 18 Copyright ©2012 by Cengage Learning Inc. All rights reserved 25
Handling Objections
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 saleLO6
Chapter 18 Copyright ©2012 by Cengage Learning Inc. All rights reserved 26
Closing the Sale
NegotiateNegotiate
Keep an open mindKeep an open mind
Look for customer signals
Look for customer signals
Tailor to each marketTailor to each market
LO6
Chapter 18 Copyright ©2012 by Cengage Learning Inc. All rights reserved 27
Following Up
In the final step of the selling process—follow up—the salesperson must ensure: delivery schedules are met goods or services perform as
promise buyers’ employees are properly
trained to use the products
Chapter 18 Copyright ©2012 by Cengage Learning Inc. All rights reserved 28
Exhibit 18.3Exhibit 18.3Relative Amount of Time Spent in the Relative Amount of Time Spent in the Key Steps of the Selling ProcessKey Steps of the Selling Process
Source : Robert Peterson, Patrick Schul, and George H. Lucas Jr., “Consultative Selling: Walking the Walk in the New Selling Enviroment,” National Conference on Sales Management Proceedings, March 1996.
Chapter 18 Copyright ©2012 by Cengage Learning Inc. All rights reserved 29
The Impact of Technology on Personal Selling
Cell phonesCell phones
LaptopsLaptops
PagersPagers
E-MailE-Mail
Electronic organizersElectronic organizers
InternetInternetLO6
Chapter 18 Copyright ©2012 by Cengage Learning Inc. All rights reserved 30
Assignment• Contests and sweepstakes are very common in the
entertainment industry. Radio stations have contests almost weekly (some daily); local television morning shows quiz viewers on trivia; even movies offer sweepstakes in conjunction with film previews and premiere nights.
• Think of a television program unlikely to have contests or sweepstakes (things like Cops, The View, or Scooby Doo). Once you have chosen your program, design a contest or sweepstakes to promote the show or the channel on which it airs. Describe the rationale behind your promotion.