Chapter 12: Selling, Sales Promotion, and Public Relations

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Chapter 12Selling, Sales Promotion, and Public
Relations
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The Sales Function

• the sales function is responsible for selling
  products and services to customers, through the
  communication of information during customer
  interaction
• it is a relatively high-cost form of promotion,
  often a firms largest single operating expense
• there is more to a personal selling job than
  selling often the job is to build a
  relationship many sales people are now referred
  to as customer-services reps
• personal selling is the most flexible promotional
  tool can be tailored to the specific customer

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Sales is Most Effective When

• the sales function is more likely to be dominant
  when
• the market is concentrated geographically
• product value is not readily apparent
• the product has high unit value. is technically,
  or requires much explanation
• the product must be tailored to a customer
• the sale involves a trade-in
• the product is at the introductory stage of its
  life cycle
• the firm has a small budget for advertising

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Scope of the Sales Function

• there are many types of sales jobs
• retailing involves inside selling these jobs may
  involve proactive selling or reactive selling
• outside sales persons go to the customer there
  is usually some opportunity for creative selling
  and addressing customer needs
• electronic selling through telemarketing is a
  relatively new development which combines with
  databases to better target customers

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Figure 12-1 Scope of the Sales Function
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The New Focus of Selling

• selling may be a misleading term often there
  is no selling involved sales personnel are
  providing service and building relationships
• because of their interpersonal contact with the
  customer, sales people influence the image of the
  firm
• they provide a valuable service role , and
  ideally become the customers trusted partner

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The Nature of Sales Jobs

• many sales reps are now professional sales
  persons with complete responsibility for
  relations with their customers
• there is often considerable opportunity for role
  conflict and role ambiguity
• there is a wide variety of sales jobs from
  delivery drivers to creative sales engineers
• the sales staff is the front line and represents
  the firm to its customers

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Changing Patterns in Sales

• the nature of the selling job is changing,
  reflecting changing market situations
• many firms have organized sales teams
• others now offer their customers a coordinated
  systems and solutions for their problems
• there is considerable emphasis today on the
  development of relationships with customers
• technology has changed the way many firms sell,
  relying on telemarketing and the Internet

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Relationship Selling

• high levels of trust are important
• buyer must demonstrate trust in the salesperson
  as well as the selling organization
• trusted salespeople can retain the buyers
  commitment even in the face of policies that may
  not be considered satisfactory
• sales people have a major role in the management
  of customer relationships

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The Sales Process

• many firms follow a predictable sales pattern
• prospecting involves the identification of
  prospects from various sources
• qualifying the prospect determines the
  willingness and capability to buy
• presenting the sales message (attract attention,
  hold interest, stimulate desire, close the sale)
• there is often a need to serve customers after
  the sale to ensure their satisfaction

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Figure 12-2 The Personal Selling Process
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Staffing/Operating a Sales Force

• staffing is a critical sales-force decision must
  ensure that staff have necessary qualifications
• the firm needs a system to generate applicants
• recruitment often involves extensive screening
• extensive sales force training is often needed
• the sales force must be supervised and managed
• their performance has to be evaluated
  compensation systems must be put in place

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Figure 12-3 Staffing and Operating a Sales Force
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Evaluating Sales Performance

• a system must exist to evaluate performance
• serves as the basis for training programs and for
  determining appropriate rewards
• quantitative bases for performance review include
  sales generated, number of orders, closing rate,
  number of calls made
• qualitative bases include product knowledge,
  preparedness for calls, success in establishing
  relationships, appearance, and attitude

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Sales Promotion

• sales promotions stimulate short-term sales
  through non-advertising means coupons, contests,
  samples, displays, premiums, trade shows
• may be directed at end consumers (consumer
  promotions) or at intermediaries (trade
  promotions) or a firms sales force
• sales promotions are short-term in orientation
  and tactical in achieving certain objectives
• it may be easier to evaluate the effectiveness of
  sales promotions than it is for advertising

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Public Relations

• public relations is intended to develop and
  maintain a positive public image for a firm
• objective is to maintain good relations with a
  number of publics this may be achieved by
  generating positive publicity
• publicity is usually considered to be a news
  item that appears about a specific company
• positive publicity is achieved through press
  releases, press conferences, and events

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Chapter 13Retailing
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Figure 13-1 Total Retail Trade in Canada,
Selected Years
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Retailing

• retailing involves the sale of products and
  services to end consumers for their personal
  non-business use
• not all sales by retailers are retail sales.
  why?
• similarly, not all retailing is done by retailers
• most of the retailers of Canada are very small
• there is considerable concentration in retailing,
  accounted for by the large chains
• many small retailers join contractual vertical
  marketing systems to increase their
  competitiveness

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Physical Facilities of Retailers

• most retailers operate from stores, although more
  now engage in nonstore retailing
• those that operate stores must consider where to
  locate their stores, how to design them, and what
  physical layout to use
• much retailing in Canada is concentrated in
  shopping centres which range in size from small
  neighbourhood convenience centres to very large
  regional centres

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Forms of Retailing

• most retailers are independents
• corporate chains are centrally owned and managed
  which means that individual stores have
  relatively little autonomy
• chains can generally offer their customers lower
  prices because of a lower cost structure
• they spread their risk and exposure over a larger
  number of stores they can experiment and gain
  economies of scale in advertising
• however, they tend to be quite standardized

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Franchising and Other VMS

• retail co-operatives and voluntary chains offer
  retailers increased buying power and the benefits
  of management and marketing support
• product and trade name franchising allows a
  retailer to use the franchisors trade name for
  promotional purposes focus is on what is sold
• in business format franchising, a firm with a
  track record sells the right to operate identical
  businesses focus is on how the business is run

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Major Types of Retailers

• department stores offer a wide variety of
  mechandise and services and dont compete on the
  basis of price they are facing intense
  competition and high operating costs
• discount houses are large-scale chain retailers
  that offer a wide range of products but less
  depth they offer low prices and fewer services
  and have succeeded in keeping costs low through
  use of technology

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Limited-line Retailers

• limited-line retailers offer customers less
  selection, but great depth within their lines
• specialty stores carry a very narrow product
  line, usually specializing in a single category
• off-price retailers offer a deep assortment in a
  narrow line, low prices, and few services these
  include factory outlets
• category-killer stores offer a very wide variety
  and low prices dominate the category

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Other Forms of Retailing

• many of the established retailers are moving
  toward new forms of distribution, including
  telephone and Internet shopping
• supermarket retailing has extended with the
  opening of superstores and combination stores
• convenience stores are open 24 hours
• warehouse club chains have made a major entry
  into Canada in recent years they offer a wide
  breadth of products, but little depth

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Nonstore Retailing

• there has been considerable growth in nonstore
  retailing with advancing technology and changing
  consumer shopping preferences
• direct selling avoids using intermediaries
• telemarketing uses sales people on the phone to
  sell products and services
• direct marketing uses catalogues, direct mail,
  television shopping, and the Internet
• many products and services are now sold through
  vending machines

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Online Retailing

• more and more companies are selling directly to
  consumers over the Internet
• those that operate only online have struggled to
  become profitable those that also have a
  physical stores are more likely successful
• shopping-cart abandonment is high challenge to
  turn browsers into buyers

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Retailing Management

• in a competitive market, positioning of retailers
  is a challenge
• in many retail operations, managing through
  seasonal and fashion cycles is necessary
• through technology, retailers will have access to
  considerable volumes of information improved
  productivity will be one result
• retailers will place greater emphasis on
  convenience, customer service, and customer
  retention

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Managing Retail Assortments

• Style and Fashion
• Style a distinctive presentation or construction
  of any art, product, or activity.
• Fashion A style that is popularly accepted by
  groups of people over a reasonably long period of
  time.
• Fashion-adoption process
• Large or small group influences of buying
  decisions.
• Diffusion of innovation.

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Figure 13-2 Fashion-Adoption Processes
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Next Class

• Supply System (Chapter 14).
• Review for the final exam.