Sales Force
Step 4 Analyzing Competitors Costs Prices and Offers
Within the range of possible prices determined by market demand and company costs, the firm must take into account its competitors' costs, prices, and possible price reactions. If the firm's offer is similar to a major competitor's offer, then the firm will have to price close to the competitor or lose sales. If the firm's offer is inferior, it will not be able to charge more than the competitor charges. If the firm's offer is superior, it can charge more than does the competitor remembering,...
The Nature and Contents of a Marketing Plan
The marketing plan created for each product line or brand is one of the most important outputs of planning for the marketing process. A typical marketing plan has eight sections Executive summary and table ofcontents This brief summary outlines the plan's main goals and recommendations it is followed by a table of contents. Current marketing situation This section presents relevant background data on sales, costs, profits, the market, competitors, distribution, and the macroenvironment, drawn...
Product or Brand Management Organization
Companies producing a variety of products and brands often establish a product (or brand-) management organization. The product-management organization does not replace the functional management organization but rather serves as another layer of management. A product manager supervises product category managers, who in turn supervise specific product and brand managers. A product-management organization makes sense if the company's products are quite different, or if the sheer number of...
Sales Professionalism
In the course of instilling professionalism, all sales-training approaches try to convert a salesperson from a passive order taker into an active order getter. Order takers operate on the assumption that customers know their own needs, resent attempts to influence them, and prefer courteous and self-effacing salespersons. There are two basic approaches in training salespersons to be order getters a sales-oriented approach and a customer-oriented approach. The sales-oriented approach trains the...
Executive Summary Dgk
Companies usually are more effective when they target their markets. Target marketing involves three activities market segmentation, market targeting, and market positioning. Markets can be targeted at four levels segments, niches, local areas, and individuals. Market segments are large, identifiable groups within a market, with similar wants, purchasing power, location, buying attitudes, or buying habits. A niche is a more narrowly defined group. Many marketers localize their marketing...
Market Test Method
Where buyers do not plan their purchases carefully or experts are not available or reliable, a direct market test is desirable. A direct market test is especially desirable in forecasting new-product sales or established product sales in a new distribution channel or territory. 1. Three developments make the need for marketing information greater now than at any time in the past the rise of global marketing, the new emphasis on buyers' wants, and the trend toward nonprice competition. 2. To...
Geographic Organization
A company selling in a national market often organizes its sales force (and sometimes other functions, including marketing) along geographic lines. The national sales manager may supervise four regional sales managers, who each supervise six zone managers, who in turn supervise eight district sales managers, who supervise ten salespeople. Several companies are now adding area market specialists (regional or local marketing managers) to support the sales efforts in high-volume, distinctive...
Eciding On Media And Measuring Effectiveness
After choosing the message, the advertiser's next task is to choose media to carry it. The steps here are deciding on desired reach, frequency, and impact choosing among major media types selecting specific media vehicles deciding on media timing and deciding on geographical media allocation. Then the results of these decisions need to be evaluated. DECIDING ON EACH, F EQ ENC , AND IMPAC Media selection involves finding the most cost-effective media to deliver the desired number of exposures to...
Major Decisions in Sales Promotion
In using sales promotion, a company must establish its objectives, select the tools, develop the program, pretest the program, implement and control it, and evaluate the results. Establishing objectives. Sales-promotion objectives are derived from broader promotion objectives, which are derived from more basic marketing objectives that are developed for the product. The specific objectives for sales promotion vary with the target market. For consumers, objectives include encouraging purchase of...
Sales Force Objectives and Strategy
Each company needs to define the specific objectives its sales force will achieve. Increasingly, companies are setting objectives for sales reps based not only on sales volume and profitability targets, but also on their ability to create customer satisfaction. Consider Tiffany, the famous retailer of expensive jewelry. A purchase in this store can be like an investment, so management trains its retail sales staff to be consultants rather than strictly salespeople. Salespeople are trained to...
Public and Ethical Issues in Direct Marketing
Although direct marketers and their customers usually enjoy mutually rewarding relationships, a darker side occasionally emerges. Key public and ethical issues include Irritation Many people find the increasing number of hard-sell, direct-marketing solicitations by phone, television, and e-mail to be a nuisance. Unfairness Some direct marketers take advantage of impulsive or less sophisticated buyers.
Ales Promotion
Sales promotion is a key ingredient in marketing campaigns. We define it as follows Sales promotion consists of a diverse collection of incentive tools, mostly short term, designed to stimulate quicker or greater purchase of particular products or services by consumers or the trade.47 Whereas advertising offers a reason to buy, sales promotion offers an incentive to buy. Sales promotion includes tools for consumer promotion (samples, coupons, cash refund offers, prices off, premiums, prizes,...
Brand Strategy Decision
A company has five choices when it comes to brand strategy. The company can introduce line extensions existing brand name extended to new sizes or flavors in the existing product category , brand extensions brand names extended to new-product categories , multibrands new brand names introduced in the same product category , new brands new brand name for a new category product , and co-brands brands bearing two or more well-known brand names . Line Extensions Line extensions introduce additional...
Business Goods Market Testing
Business goods can also benefit from market testing. Expensive industrial goods and new technologies will normally undergo alpha testing within the company and beta testing with outside customers . During beta testing, the vendor's technical people observe how test customers use the product, a practice that often exposes unanticipated problems of safety and servicing and alerts the vendor to customer training and servicing requirements. The vendor can also observe how much value the equipment...
Organizations Also Vary in Readiness to Adopt Innovations
The creator of a new teaching method would want to identify innovative schools. The producer of a new piece of medical equipment would want to identify innovative hospitals. Adoption is associated with variables in the organization's environment community progressiveness, community income , the organization itself size, profits, pressure to change , and the administrators education level, age, sophistication . Other forces come into play when trying to get a product adopted into organizations...
Step 6 Developing and Managing the Marketing Communications Mix
Having established a communications budget, companies must decide how to allocate it over the five promotional tools. Companies differ considerably in their allocations, even within the same industry. Avon concentrates its promotional funds on personal selling, whereas Cover Girl spends heavily on advertising. Still, because companies are always searching for more efficiency by substituting one promotional tool for another, they must be careful to coordinate all of their marketing functions....
The Growing Use of Integrated Direct Marketing
Companies are increasingly recognizing the importance of integrating their marketing communications. Some companies are appointing a chief communications officer (CCO) to supervise specialists in advertising, sales promotion, public relations, and direct on-line marketing. The aim is to establish the right overall communication budget and the right allocation of funds to each communication tool. This movement has been variously called integrated marketing communications (IMC), integrated direct...
Major Decisions in Marketing PR
In considering when and how to use MPR, management must follow the same process as it does for advertising and sales promotion Establish the marketing objectives, choose the messages and vehicles, implement the plan carefully, and evaluate the results. The main tools of MPR are described in Table 5.6.41 Establishing the marketing objectives. These may include Build awareness of a product, service, person, organization, or an idea add credibility by communicating a message in an editorial...
Conflict Cooperation and Competition
No matter how well channels are designed and managed, there will be some conflict, if for no other reason than the interests of independent business entities do not always coincide. Here we examine three questions What types of conflict arise in channels What causes channel conflict What can be done to resolve conflict situations Vertical channel conflict means conflict between different levels within the same channel. As one example, General Motors has come into conflict with its dealers in...
Accumulated Production
Suppose TI runs a plant that produces 3,000 calculators per day. As TI gains experience producing calculators, its methods improve. Workers learn shortcuts, materials flow more smoothly, and procurement costs fall. The result, as Figure 4-10 shows, is that average cost falls with accumulated production experience. Thus, the average cost of producing the first 100,000 hand calculators is 10 per calculator. When the company has produced the first 200,000 calculators, the average cost has fallen...
Patterns of Market Segmentation
Market segments can be built up in many ways. One common method is to identify preference segments. Suppose ice cream buyers are asked how much they value sweetness and creaminess as two product attributes. Three different patterns can emerge Homogeneous preferences Figure 3-6 shows a market in which all of the consumers have roughly the same preference, so there are no natural segments. We predict that existing brands would be similar and cluster around the middle of the scale in both...
Marketing Implementation
Organization is one factor contributing to effective marketing implementation, the process that turns marketing plans into action assignments and ensures that such assignments are executed in a manner that accomplishes the plan's stated objectives.26 This part of the marketing process is critical, because a brilliant strategic marketing plan counts for little if it is not implemented properly. Whereas strategy addresses the what and why of marketing activities, implementation addresses the who,...
Multi Attribute Segmentation Geoclustering
Marketers are increasingly combining several variables in an effort to identify smaller, better defined target groups. Thus, a bank may not only identify a group of wealthy retired adults, but within that group may distinguish several segments depending on current income, assets, savings, and risk preferences. One of the most promising developments in multi-attribute segmentation is geoclustering, which yields richer descriptions of consumers and neighborhoods than does traditional...
Growth of Direct Marketing and Electronic Business
Sales produced through traditional direct-marketing channels (catalogs, direct mail, and telemarketing) have been growing rapidly. Whereas U.S. retail sales grow around 3 percent annually, catalog and direct-mail sales are growing about 7 percent annually. These sales include sales to consumers (53 percent), business-to-business sales (27 percent), and fundraising by charitable institutions (20 percent). Annual catalog and direct-mail sales are estimated at over 318 billion, with per capita...
Customized Customer Loyalty By Robert Duboff And Lori Sherer
For estimates of the cost of sales calls, see Sales Force Compensation (Chicago Dartnell's 27th Survey, 1992), and Sales & Marketing Management's 1993 sales manager's budget planner (June 28, 1993), pp. 3-75. 2. For more on sales force automation issues, see Doug Bartholomew, Hard Sell Industry Week, March 1, 1999, www.industryweek.com James LaVoy, So, Did You Get What You Paid For Sales & Field Force Automation, February 1999, pp. 48-54. 3. Adapted from Robert N. McMurry, The Mystique of...
Sales Force Structure
The sales force strategy has implications for the sales force structure. If the company sells one product line to one end-using industry with customers in many locations, it would use a territorial sales force structure. If the company sells many products to many types of customers, it might need a product or market sales force structure. Table 5.13 summarizes the most common sales force structures. Major accounts (also called key accounts, national accounts, global accounts, or house accounts)...
Core Marketing Concepts
Marketing can be further understood by defining the core concepts applied by marketing managers. A marketer can rarely satisfy everyone in a market. Not everyone likes the same soft drink, automobile, college, and movie. Therefore, marketers start with market segmentation. They identify and profile distinct groups of buyers who might prefer or require varying products and marketing mixes. Market segments can be identified by examining demographic, psychographic, and behavioral differences among...
The Buying Center
Webster and Wind call the decision-making unit of a buying organization the buying center. The buying center is composed of all those individuals and groups who participate in the purchasing decision-making process, who share some common goals and the risks arising from the decisions.9 The buying center includes organizational members who play any of seven roles in the purchase decision process 10 Initiators People who request that something be purchased, including users or others. Users Those...
Composite of Sales Force Opinions
Where buyer interviewing is impractical, the company may ask its sales representatives to estimate their future sales. Each sales representative estimates how much each current and prospective customer will buy of each of the company's products. Few companies use their sales force's estimates without making some adjustments. Sales representatives might be pessimistic or optimistic, or they might go from one extreme to another because of a recent setback or success. Furthermore, they are often...
Sales Force Size and Compensation
Once the company clarifies its sales force strategy and structure, it is ready to consider sales force size, based on the number of customers it wants to reach. One widely-used method for determining sales force size is the five-step workload approach (1) group customers into size classes by annual sales volume (2) establish call frequencies, the number of calls to be made per year on each account in a size class (3) multiply the number of accounts in each size class by the call frequency to...
Population Age Mix In Marketing
National populations vary in their age mix. At one extreme is Mexico, a country with a very young population and rapid population growth. At the other extreme is Japan, a country with one of the world's oldest populations. Milk, diapers, school supplies, and toys would be important products in Mexico. Japan's population would consume many more adult products. A population can be subdivided into six age groups preschool, school-age children, teens, young adults age 25 to 40, middle-aged adults...
Customer Databases and Direct Marketing
More marketers are harnessing information technology to build sophisticated customer databases and shift from mass marketing to highly targeted, one-to-one marketing (see Table 6.4).4 As discussed in Chapter 4, a customer database is an organized collection of comprehensive data about individual customers or prospects that is current, accessible, and actionable for such marketing purposes as lead generation, lead qualification, sale of a product or service, or maintenance of customer...
Service Sector Channels
The concept of marketing channels is not limited to the distribution of physical goods. Producers of services and ideas also face the problem of making their output available and accessible to target populations. For instance, schools develop educational-dissemination systems and hospitals develop health-delivery systems. These institutions must determine agencies and locations for reaching a population that is spread out over an area. Similarly, many states face the problem of locating branch...