Sales Promotions &Personal Selling

Sales Promotion

• Sales promotion is the use of short-term incentives aimed at influencing consumer perception and behaviour to encourage early purchase of a product, and build market share through increased sales.

1. Sales promotion is a term that is closely linked with direct and digital marketing, but has its origins in FMCG.

2. Although sales promotion may mean different things in different organisations, it is generally agreed that they are value-adding tools aimed at encouraging early purchase.

3. Sales promotions cover a range of incentives that are used with products promoted via either mass media advertising, or by direct and digital methods.

Purpose of • Sellers use sales promotions to:

– encourage new ‘customers’ to try the product– take consumers away from competitors’ products – reward brand-loyal customers and retain them– reduce the time lapse between customer purchases– turn light users into medium or heavy users

• Aim might also be to regain past purchasers who have stopped buying, or to discourage current users from buying a competitor’s product.

• Potential new users fall into one of 3 groups: non-users; loyal users of another brand; brand switchers.

Sales Promotion Tools

• The main tools are:

1. Samples

2. Redeemable coupons

3. Cash-back offers

4. Cents-off deals/ price packs

5. Premium offers

6. Advertising specialties

7. Patronage rewards

8. Point-of-purchase promotions

9. Contests and games of chance/ skill

Cont’d

• Trade Promotion Tools– Incentives applied to the retail trade to stock

and promote more of a product or to provide increased merchandising space, usually during a consumer promotion.

• Business-to-Business Promotion Tools– Industrial marketers adapt many of the tools

to suit their own situations, including the use of conventions; trade shows; sales contests.

Developing Sales Promotion Programs

• Several decisions must be made in order to define the full sales promotion program:

– The size of the incentive to be offered.– How to promote and distribute the program.– The duration of the promotion.– How to evaluate the benefits achieved.

• There are many types of personal selling jobs, and the role of personal selling can vary greatly from industry to industry; and from company to company.

• The people who do the selling go by many names: – Salespeople– Sales representatives– Marketing representatives– Account executives/representatives– Sales consultants– Agents– District mangers

Personal Selling

Cont’d

Personal selling:

• Can provide a detailed explanation or demonstration of a product and its benefits

• Enables the marketing message to be modified to suit each specific selling situation

• Is of most benefit when:– Fewer prospects are involved (e.g. B2B)

– Marketing a higher value product

– The product is ‘highly technical’

The Role of the Salesforce• Personal selling is the interpersonal element of the

promotion mix. • Advertising consists of one-way, non-personal

communication with target consumer groups.• Personal selling involves two-way, personal

communication between salespeople and individual customers, which can be: – face-to-face – by telephone – through video conference – or by other means

In complex selling situations, personal selling can be more effective than non-personal’ advertising.

Cont’d

Sales people:

• Serve as a critical link between a company and its customers

• Represent the company to the customers

• Represent the customers to the company

• Are concerned with producing sales, but should also be concerned with delivering customer satisfaction while achieving profit

Managing the Salesforce

• Salesforce Management– The analysis; planning; implementation; and

control of the salesforce activities.– This includes:

• Setting objectives, and designing strategy• Recruiting; selecting; training; compensating;

supervising; and evaluating the firm’s salesforce.

Recruiting and Selecting Sales People

• First and foremost in a successful selling operation is the selection of good salespeople.

• Successful salespeople can come in all shapes and sizes, but the best share four key talents. They are:– Naturally motivated

– Disciplined in their approach to work

– Skilled in ‘closing’ a sale

– Able to build relationships with customers

• Generally the top performers are empathetic; patient; caring; responsive; good listeners; and honest.

• Today, the average training period for a salesperson can be as short as four months.

• Training programs have several goals.

• Sales people need to:– know and identify with the company.

– be familiar with the company’s products.

– know customers’ and competitors’ characteristics.

– know how to make effective presentations, and be trained in the principles of selling.

– understand field procedures and responsibilities.

Training Salespeople

Compensating Salespeople

• To attract the required salespeople, a company must have an attractive compensation plan.

• The level of compensation must be close to the ‘going rate’ for the type of job and skills required.

• Compensation can be made up of several elements– a fixed amount; a variable amount based on

performance; an expense allowance; fringe benefits.

• Management must decide what mix of these elements makes the most sense for each sales job.

Supervising and Motivating Salespeople

• New salespeople need supervision to help them ‘work smart’ and use their time efficiently.

• Management can boost morale and performance through achievable sales quotas, and incentives

• The appropriate motivation helps salespeople to work energetically towards agreed sales targets.

How Salespeople might spend their time

Evaluating Salespeople and Performance

• Performance information about salespeople can be gathered from various sources:

– Sales reports

– Call reports

– Expense reports

– Personal observation

– Customers’ letters/ complaints

– Customer surveys

– Other salespeople

The Personal Selling Process

• Steps in the Selling Process:

– Prospecting

– Pre-approach

– Approach

– Presentation and demonstration

– Handling objections

– Closing

– Follow-up with customer

Relationship Marketing

• This is the process of creating, maintaining and enhancing strong, mutually beneficial relationships with customers and other stakeholders.

• RM places an emphasis on building and maintaining profitable long-term relationships with customers by delivering superior customer value and satisfaction.

• Many companies are realising that winning and retaining customers requires more than making good products and closing lots of sales.

• It requires a carefully coordinated, total company effort to create value-laden, satisfying customer relationships.