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Adjusting to the Dynamic Personal Selling Environment

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1 Adjusting to the Dynamic Personal Selling Environment
Chapter Two Adjusting to the Dynamic Personal Selling Environment PowerPoint presentation prepared by Dr. Rajiv Mehta

2 After reading this chapter, you should understand:
Learning Objectives After reading this chapter, you should understand: Megatrends affecting personal selling. Adapting to megatrends. Professional salespeople as micro-marketing managers. What megatrends are affecting personal selling now and what megatrends will affect personal selling in the foreseeable future. How “online” sales channels are empowering customers, especially giant retailers. Royalty-Free, Digital Vision/Getty Images Copyright © Houghton Mifflin Company. All rights reserved.

3 Learning Objectives cont’d
After reading this chapter, you should understand: How developments in telecommunications technology are dramatically changing personal selling. Why rising personal selling costs are encouraging salespeople and their companies to make increasing use of alternative direct-marketing techniques. What current trends in information management will affect how salespeople do their jobs. Why today’s professional salespeople need to be much like micro-marketing managers in their expanding roles. Royalty-Free, Digital Vision/Getty Images Copyright © Houghton Mifflin Company. All rights reserved.

4 Megatrends Affecting Personal Selling
Salespeople must adapt to 3 major megatrends to enhance their effectiveness and efficiency: 1. Behavioral forces 2. Technological forces 3. Managerial forces Royalty-Free, Digital Vision/Getty Images Copyright © Houghton Mifflin Company. All rights reserved.

5 Megatrends: Behavioral Forces
Copyright © Houghton Mifflin Company. All rights reserved.

6 Megatrends: Behavioral Forces cont’d
Buyers’ attitudes, preferences, and behaviors are changing, necessitating salespeople to modify their selling strategies and approaches. Behavioral forces include: More expert and demanding buyers Rising customer expectations Micro-segmentation of domestic markets Expanding power of giant retailers Globalization of markets Empowerment of customers Chapter Review Question: What specific market and competitive forces are changing personal selling and buyer-seller relationships? What are their effects? Royalty-Free, Digital Vision/Getty Images Copyright © Houghton Mifflin Company. All rights reserved.

7 Megatrends: Empowerment of Customers
Copyright © Houghton Mifflin Company. All rights reserved.

8 Megatrends: Technological Forces
Copyright © Houghton Mifflin Company. All rights reserved.

9 Megatrends: Technological Forces cont’d
Today’s successful salespeople are those who can make skillful and efficient use of technology to increase their efficiency and productivity in serving customers. Technological forces include: Sales force automation Virtual sales offices (home, automobile, or virtually anywhere) Electronic commerce Royalty-Free, Photodisc/Getty Images Chapter Review Question: Name some major advances in telecommunications and computer technology that are affecting personal selling. Describe briefly how salespeople can use each to improve their effectiveness and efficiency. Copyright © Houghton Mifflin Company. All rights reserved.

10 Megatrends: Technological Forces cont’d
Among the most important of the technological innovations in sales force automation include: Sales Force Automation Portable computers Electronic data interchange Videoconferencing Multifunction cell phones and satellite pagers Voice mail and Electronic mail Instant messaging Royalty-Free, Digital Vision/Getty Images Virtual Sales Offices Electronic Commerce Internet: Blogs, Podcasting Screen-Sharing, WebEx Intranet Extranet Home Office Virtually Anywhere Royalty-Free, Photodisc/Getty Images Royalty-Free, Digital Vision/Getty Images Copyright © Houghton Mifflin Company. All rights reserved.

11 Megatrends: Managerial Forces
Copyright © Houghton Mifflin Company. All rights reserved.

12 Megatrends: Managerial Forces cont’d
In response to the dynamic behavioral and technological megatrends, sales organizations are trying various strategies to achieve profitable sales growth and closer customer relationships Managerial forces include: Efforts to reduce selling costs Shift to direct marketing alternatives Certification of salespeople Royalty-Free, Digital Vision/ Getty Images Copyright © Houghton Mifflin Company. All rights reserved.

13 Megatrends: Managerial Forces cont’d
Efforts to Reduce Selling Costs Median cost of a business-to-business sales call: more than $250 (varies widely by industry and company) For some large industrial companies, a sales call can cost $400 to $1,000 or more because of the unusual complexity of both the selling process and the product itself To reduce selling costs, many manufacturers and service providers are aggressively seeking alternatives to large national sales forces (e.g., use of middlemen, part-time salespeople, and direct marketing efforts). Royalty-Free, Photodisc/Getty Images Chapter Review Question: What are some companies doing to reduce selling costs? Copyright © Houghton Mifflin Company. All rights reserved.

14 Megatrends: Managerial Forces cont’d
Shift to Direct Marketing Alternatives Chapter Review Question: In your own words, define the term direct marketing. Describe some tools and techniques used in direct marketing. What is teleselling? How have many former field salespeople who were transferred to teleselling increased their incomes? To sell to organizational buyers, several direct marketing alternatives support or bypass field salespeople: Direct mail Telemarketing, which includes: Teleselling Kiosks (or “computer salespeople”) Facsimile Personalized © Royalty-Free/CORBIS Copyright © Houghton Mifflin Company. All rights reserved.

15 Figure 2.1: Telemarketing Applications, Advantages, and Disadvantages
Copyright © Houghton Mifflin Company. All rights reserved.

16 Megatrends: Managerial Forces
Certification of Salespeople Because of the public’s negativism toward personal selling, efforts have been directed at certifying sales personnel Certification usually requires that a salesperson: Gains a certain amount of practical experience Enrolls in educational seminars and courses Passes a sales competency exam Provides some professional references Agrees to comply with a code of conduct © Royalty-Free/CORBIS Chapter Review Question: Describe the three broad megatrends affecting personal selling. Copyright © Houghton Mifflin Company. All rights reserved.

17 Adapting to Megatrends
Salespeople and their companies can adapt to megatrends using various information management tools Behind the forces that are influencing salespeople and the way they operate are four key trends in the management of information: (1) Database marketing (2) Data warehousing (3) Push technology (4) Data mining Royalty-Free, Digital Vision/Getty Images Copyright © Houghton Mifflin Company. All rights reserved.

18 Four Major Trends in Information Management
1. Database marketing: A database is a large computerized file of customers’ and potential customers’ profiles and purchase patterns. 2. Data warehousing: A very large, corporate-wide database, built with data from a number of information systems already in place in the company. Chapter Review Question: How are information management trends affecting salespeople? 3. Data mining: Refers to the process of using statistical analysis to detect relevant patterns or relationships between and among variables in a database. 4. Push technology: Push technology is the latest iteration of combined with data warehousing to discern what your customers need and exactly when they need it. Copyright © Houghton Mifflin Company. All rights reserved.

19 Information Management and Relationship Selling
Information management and relationship selling go hand-in-hand as part of the evolutionary development of a marketing strategy used in one-to-one marketing and by salespersons as one-to-one relationship builders. Copyright © Houghton Mifflin Company. All rights reserved.

20 Information Management and Relationship Selling cont’d
One-to-one marketing: Concentrates on selling more goods, more profitably, to fewer selected customers (instead of selling more goods to more customers) © Royalty-Free/CORBIS Salespeople as one-to-one relationship builders: Building trust and long-term relationships with customers determines the success of one-to-one marketing strategies, especially in business-to-business markets © Royalty-Free/CORBIS Copyright © Houghton Mifflin Company. All rights reserved.

21 Professional Salespeople as Micro-Marketing Managers cont’d
In addition to selling products, today’s sales representatives must serve customers as consultants by offering expert advice for making a customer’s business operations more profitable Salespeople offer expert advice on: Building partnerships with their customers Buyer-seller team coordinators Market analysts and planners Customer service providers Buyer behavior experts Opportunity spotters Intelligence gatherers Sales forecasters Marketing cost analysts Allocators of scarce products Field public relations people Adopters of advanced sales technology Chapter Review Question: Why must today’s professional salesperson learn to function more like a micro-marketing manager in the field? Copyright © Houghton Mifflin Company. All rights reserved.

22 Chapter Review Questions
Why do some companies see selling in the United States as increasingly like selling internationally? Describe the type of assistance that salespeople may receive from the company’s telemarketing staff. What can field salespeople do to increase the benefits they derive from telemarketers? Copyright © Houghton Mifflin Company. All rights reserved.

23 Topics for Thought and Class Discussion
Which of the advances in telecommunications and computer technology do you think will provide the most help to salespeople over the next decade? Discuss how you think salespeople can take advantage of each of the phenomena taking place under the managerial megatrend. How do you think the rising cost of personal selling and the growth of direct-marketing techniques will affect salespeople? Copyright © Houghton Mifflin Company. All rights reserved.

24 Internet Exercises Many major companies sell more products and services online via e-commerce than they do in traditional brick-and-mortar stores or outlets. Check out the websites of each of the following companies and see whether they offer purchasing options online. Also, try to find out their dollar sales volumes online and off-line compare. Cisco Systems (www.cisco.com) Williams-Sonoma (www.williams-sonoma.com) Pitney Bowes (www.pitneybowes.com) Staples (www.staples.com) Copyright © Houghton Mifflin Company. All rights reserved.

25 Internet Exercises cont’d
Salespeople need to keep up with the latest technologies (including computer software) that might affect how they do their sales jobs. Go to the following websites, or to other professional selling-related websites, and find three innovations that you think will help salespeople become more effective and efficient. Describe these innovations, and explain why you feel each will increase salesperson productivity. Sales and Marketing Management (www.salesandmarketing.com/smm/index.jsp) Siebel Systems (www.siebel.com) SalesForce.com (www.salesforce.com) SellingPower.com (www.sellingpower.com) Copyright © Houghton Mifflin Company. All rights reserved.

26 Projects For Personal Growth
Assume that a firm has divided the United States into ten regional markets based on need for its products—industrial lawn mowers, lawn sweepers, watering equipment, and garden tools. Also assume that the company’s CEO has asked you to prepare a map of the United States showing these regional markets. Clearly label each region according to how you identify it. For example, perhaps part of the southwestern United States has different needs owing to the terrain and desert-like environment of the area, whereas part of Florida may be identified with abundant moisture, humidity, and tropical plants. Do any library research necessary to complete your map. Copyright © Houghton Mifflin Company. All rights reserved.

27 Projects For Personal Growth cont’d
Ask two business-to-business salespeople about telecommunication use in their sales work. What SFA equipment has been most helpful to them? Why? How have their companies assisted them in selling and in serving prospects and customers? What other equipment would they like? What other support would they like from their companies in helping them work with prospects and customers? Copyright © Houghton Mifflin Company. All rights reserved.

28 Case 2.1: Savoring Success and Contemplating the Future
Do you think the use of high-tech equipment—laptop computers, cell phones, pagers, and the like—will help the young saleswomen appear more professional? Assume you are a friend of one of the women. What five ideas would you give her about using the Internet and other telecommunication tools to make her more effective and efficient in her sales assignments? Copyright © Houghton Mifflin Company. All rights reserved.

29 Case 2.1: Savoring Success and Contemplating the Future cont’d
Are the women’s ideas about making their sales jobs easier realistic? Which ones make the most sense? Which ones make the least sense? Could the company provide a lot of this information for customers on an extranet or on the Internet? Do the women have an accurate understanding of what many salespeople are expected to do today? Why or why not? What can the company do to help its salespeople handle their expanded roles? Copyright © Houghton Mifflin Company. All rights reserved.

30 Case 2.1: Savoring Success and Contemplating the Future cont’d
In their conversation, do the women seem unnecessarily concerned about taking on their new territorial assignments? Do you think any special issues arise for saleswomen but not for salesmen? Why or why not? Copyright © Houghton Mifflin Company. All rights reserved.

31 Case 2.2: We’re Trying To Cut Costs ... We Can’t Afford Laptops Now!
Which customers would you advise Russ to call on with Homer? What should Russ say to Homer about purchasing laptop computers for the full-time sales force? Do you think S&B should buy laptop computers for the fifteen manufacturers’ reps, too? Would any other equipment aid personal selling at S&B? If so, should S&B be asked to purchase it for the salespeople? How might Russ recommend buying laptop computers without Homer seeing it as running counter to S&B’s current cost-reduction push? Will the laptops pay off for S&B? Could the company expand its markets through the use of computers and ? Case 2.2 is found online at Copyright © Houghton Mifflin Company. All rights reserved.

32 Case 2. 2: We’re Trying To Cut Costs. We Can’t Afford Laptops Now
Case 2.2: We’re Trying To Cut Costs ... We Can’t Afford Laptops Now! cont’d Do you think Russ should consider looking for another job now? Why or why not? If Homer were to retire and recommend Russ as his successor, what actions would you advise for Russ if he became S&B’s regional sales manager? How else, besides making field sales calls, might S&B reach prospects and customers? How well would the current salespeople accept your suggestions? How would you address their concerns? What other situations and possible questions should Russ prepare for during his five days traveling with Homer? Copyright © Houghton Mifflin Company. All rights reserved.


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