Marketing 4 - Chapter 18

Personal selling

Paid personal communication that informs customers and persuades them to buy products.
Most adjustable to customers’ information needs
Most precise (targeted) form of promotional methods
Most expensive element in the promotion mix
Primary Goals: Prospecting, selling, customer satisfaction

Steps in the personal selling process

Prospecting - Developing a list of potential customers

Preapproach - Finding and analyzing information about the prospect

Approach - The manner in which a salesperson contacts a potential customer

Making the presentation - Self-explanatory

Overcoming objections - Anticipate objections and counter them during the presentation

Closing the sale - Closing is the stage in the selling process when the salesperson asks the prospect to buy the product

Follow up - Determining if the delivery and setup of the order was completed to the customer’s satisfaction and assessing future needs

Pros and cons of personal selling

Pros: most adjustable to customer information needs and most precise (targeted) form of promotion methods

Cons: Most expensive element in promotion mix

Primary goal of personal selling

Prospecting, selling, customer satisfaction

Why is personal selling the most effective and most expensive

It uses face to face interactions so that a message can be adjusted on the spot to the consumer’sface-to-face needs, but the labor cost is strenuous.

Closing strategies

“Trial” closing: asking questions (what, how, or why) that assume the customer will buy the product

Asking for a tryout order: a low-risk way for the customer to try out the product

Why is following up important

Following up shows that the producer cares and is working to establish relationships and credibility beyond a singular purchase

Sales promotions

An activity and/or material that acts as a direct inducement to resellers or salespeople to sell a product or consumers to buy it

Purpose and objective of sales promotions

It encourages product trial and purchase by adding value to the product.

What does “sales promotion is a sales acceleration tool” mean

Using temporary, short-term incentives—like discounts, coupons, flash sales, or limited-time bundles—to push hesitant prospects across the finish line and force a buying decision much faster

Two categories of sales promotions

Consumer-oriented: Ways of encouraging consumers to patronize specific stores or to try particular products

Trade-oriented: Ways of persuading wholesalers and retailers to carry a producer’s products and to market them aggressively

Different types of consumer sales promotions

Coupons – Written price reductions used to encourage consumers to buy a specific product

Digital coupon marketing — including mobile, social, and other platforms

Demonstrations — Manufacturers use them temporarily to encourage trial use and purchase of a product or to show how a product works. Highly effective yet costly in practice

Frequent-user incentives — Incentive programs that foster consumer loyalty by rewarding customers’ repeat (frequent) purchases

Point-of-purchase displays — Signs, window displays, display racks, and similar means used to attract customers and to encourage immediate purchases

Free samples — Samples of a product given out to encourage trial and purchase; used to increase sales volume; the most expensive form of sales
promotion

Money refunds — Offering consumers money when they mail in a proof of purchase, usually for multiple product purchases

Rebates — Sending consumers a specific amount of money for making a single product purchase

Premiums — Items offered free or at a minimal cost as a bonus for purchasing a product. Premiums must match both the target market and the brand’s image. Premiums must be easily recognizable and desirable.

Cents-off offers — Promotions that let buyers pay less than the regular price to encourage purchase

Consumer contests and games — Individuals compete for prizes based on analytical or creative skills. Competitions for prizes are used to generate retail traffic and to increase exposure to promotional messages.

Consumer sweepstakes — A sales promotion in which entrants submit their names for inclusion in a drawing for prizes. Used more than contests and attracts more widespread interest

Different types of trade promotion sales

Buying allowance — A temporary price reduction to resellers for purchasing specified quantities of a product

Free merchandise — A manufacturer’s reward given to resellers for purchasing a stated quantity of goods. Usually takes the form of a reduced invoice

Merchandise allowances — A manufacturer’s agreement to help resellers pay for special promotional efforts (similar to co-op, but without the guidelines)

Cooperative advertising — Sharing of media costs by manufacturer and retailer for advertising the manufacturer’s products

Dealer listings — Ads promoting a product and identifying retailers that sell the product; influences retailers to carry the products, builds traffic at the retail level, and encourages consumers to shop at participating dealers

Premium (push) money — Extra compensation to salespersons for pushing a line of products

Sales contest — A means of motivating distributors, retailers, and salespeople by recognizing outstanding achievement

Pros and cons of sales promotions

Pros:

Can increase sales by providing extra purchasing incentives
Stronger emphasis placed on improving short-term performance results calls for greater use of sales promotion methods that yield quick sales increases.
Declines in brand loyalty create an environment in which sales promotions encouraging brand switching are more effective.

Cons:

Excessive use may damage brand image