McGraw-Hill/Irwin Copyright © 2008 by The McGraw-Hill Companies, Inc. All rights reserved. Chapter 2 Strategic Sales Force Management Strategy without tactics is the slowest route to victory. Tactics without strategy is the noise before defeat. YSun Tzu, Chinese philosopher

2-2 Figure 2-1: A Company’s Complete Marketing System Macroenvironmental forces: Physical environment Demography Economic conditions Sociocultural factors Political-legal factors Technology Competition Company’s marketing mix: Product planning Price structure Distribution system Promotional activities Marketing intermediaries Suppliers The market Nonmarketing resources in the firm: Production Financial Personnel Public image Research & devel. Location Marketing intermediaries

2-3 The Marketing Concept  A philosophy: Achieving organizational goals depends on the firm’s ability to identify the needs and wants of a target market, and then to satisfy those needs and wants better than the competition does.  Based on three fundamental beliefs –Company planning and operations should be customer or market oriented. –Marketing activities in a firm should be organizationally coordinated. –The goal of the organization should be to generate profitable sales volume over the long run.

2-4 Evolution of Marketing Management  Production orientation –Focus on mass-producing a limited variety of products for as little cost as possible.  Sales orientation –Age of the hard-sell.  Marketing orientation –The marketing concept first emerges.  Relationship orientation –A natural extension of the marketing-orientation stage. –The buyer and seller commit to doing business over a long time.

2-5 Evolution of Selling in the U.S. (the first American salespeople)  Peddlers  Canvassers  Book agents  Drummers

2-6 How do these selling styles depicted in this 1927 cartoon relate to the four stages in the evolution of marketing management? Figure 2-3

2-7 Relationship Marketing: Four key issues  Open communication  Empowering employees  Customers and the planning process  Working in teams –Total quality management

2-8 Teaching Teamwork  In your opinion, which one of these (if any) would be most effective at teaching a salesperson how to be an effective member of a selling team? –Cooking class –Drum circle –Military exercise –Outdoor adventure –Ropes exercise

2-9 Integrating…  …Marketing and Sales –Marketing executives  develop marketing strategy –Salespeople  implement the strategy in the field  …Production and Sales –Production makes what Sales sells  Close integration / accurate forecasts needed, or else… –Under-production  dissatisfied customers –Over-production  excessive, costly inventory

2-10 Strategic Planning  Objectives are the broad goals around which a strategic plan is formulated.  Strategies are the plans of action.  Tactics are the specific activities that people must perform in order to carry out the strategy. Set Objectives Formulate Strategies Develop Tactics

2-11 Company Marketing Objectives Strategy Increase marketing share 10% Company Strategy – Marketing Objectives and Strategy Earn 20% ROI Strategy Increase share of customer business Increase market share 10% Objectives

2-12 Marketing Sales Force Strategy Increase share of customer business Marketing Strategy – Sales Force Objectives, Strategy and Tactics Increase share of customer business Strategy Build long-term customer relations Tactics Develop sales teams Provide bonuses for greater customer share Increase market share 10% Objectives

2-13 Strategic Trends  Internet Selling  Multiple Sales Channels  Multiple Relationship Strategies –Transaction selling  Consultative selling  In this era of global warming, toxic waste, pollution, and other concerns, marketing executives must act in a socially responsible manner if they wish to succeed or even survive.

2-14 Customer Relationship Management  CRM practices –Involve a company-wide software application utilizing advanced computer- and Internet-technology. –Aggregate all information about customers into a single database. –Provide salespeople/customers access to timely and relevant information. –Allow effective management of every aspect of the buyer- seller relationship. –Require training  Only effective if salespeople embrace it and are willing to use it.