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Principles of Marketing

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Principles of Marketing ­ MGT301
VU
Lesson ­ 35
Lesson overview and learning objectives:
Discuss the role of a company's salespeople in creating value for customers and building customer
relationships. Today, most companies use salespeople to bring their company's offering to the
consuming or business publics. The salesperson's role is a key one in the organization. The high
cost of maintaining a sales force means that management is especially interested in how to
efficiently organize this vital element.
PERSONAL SELLING
A. Personal selling
The direct presentation of a product to a prospective customer by a representative of the selling
organization is termed as personal selling. Personal selling is the personal communication of
information to persuade somebody to buy something. Personal Selling occurs when a company
representative comes in direct contact with a customer in order to inform a client about a good or
service to get a sale. Personal selling is especially important for business-to-business marketers
since products and services are complex and expensive. In many companies, personal selling is the
largest single operating expense.
a. The Nature of Personal Selling
Selling is one of the oldest professions in the world. Today, most salespeople are well-educated,
well-trained professionals who work to build and maintain long-term relationships with customers.
They build these relationships by listening to their customers; assessing customer's needs, and
organizing the company's efforts to solve customer problems. The term salesperson covers a wide
variety of positions and responsibilities. The person can be:
1). An inside order taker.
2). An order getter (a great amount of creative selling skills are demanded in this position).
Personal selling is likely to be emphasized in a promotional mix when the market is concentrated
or the product has a high unit value, is technical in nature, and requires a demonstration. It is also
useful if the product can be tailored to an individual customer's need, or the product is in the
introductory stage of the product life cycle.
b. The Role of the Sales Force
Personal selling is the interpersonal arm of the promotion mix.  Sales people represent the
company to the customer and act as an intermediary linking the customer to the company.
c. Salespeople.
Salespeople act for a company and perform one of more of the following: prospecting of new
business; communicating with potential and existing customers; servicing customers and
information gathering. Sales positions range from: delivering product; taking orders; building
goodwill or educating customers; positions where technical knowledge is required; and creative
selling.
d. Sales management.
Sales management involves the analysis, planning, implementation and control of sales force
activities.  Advertising consists of one-way, non-personal communication with target  customer
groups while the personal selling involves two-way, personal communication between salespeople
and individual consumers.  Personal selling can be more effective than advertising in more
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Principles of Marketing ­ MGT301
VU
complex selling situations. The role of personal selling varies from company to company. Some
firms have no salespeople at all. The sales force serves as a critical link between a company and its
customers. The salesperson can represent both buyer and seller i.e.
1). They represent the company to the customer.
2). They represent customers to the company.
Salespeople are becoming more market-focused and customer-oriented.
1).The old view was that salespeople should be concerned with sales and the  company
should be concerned with profit.
2). The new view is that salespeople should be concerned with more than just producing
sales--they must know how to produce customer satisfaction and company profit.
Personal selling is performed by person-to-person dialogue between prospective buyer and the
seller through direct human contact for matching products to needs. It involves developing
relationships between buyer and the seller to discover the needs of the customers/buyers and the
benefits of the products that can satisfy the needs of customer can be communicated to customer.
e. The characteristics of personal selling
Personal selling is having flexibility of system it provides one to one contact between the buyers
and sellers. It Identify specific sales prospects the first step in the selling process is prospecting
identifying qualified potential customers. Approaching the right potential customers is crucial to
selling success. Direct contact with the potential buyers provides opportunity to demonstrate the
product and to customers and to answer the queries and questions of the customers. Answer
questions during the presentation step of the selling process, the salesperson tells the product
"story" to the buyer, showing how the product will make or save money. The salesperson describes
the product features but concentrates on presenting customer benefits. Using a need-satisfaction
approach, the salesperson starts with a search for the customer's needs by getting the customer to
do most of the talking. During demonstration there can be certain objections raised by the
customers, which can be overcome at very same time. Customers almost always have objections
during the presentation or when asked to place an order. The problem can be either logical or
psychological, and objections are often unspoken. In handling objections, the salesperson should
use a positive approach, seek out hidden objections, asks the buyer to clarify any objections, take
objections as opportunities to provide more information, and turn the objections into reasons for
buying. Every salesperson needs training in the skills of handling objections.
f. Builds Relationships
The principles of personal selling as just described are transaction oriented--their aim is to help
salespeople close a specific sale with a customer. But in many cases, the company is not seeking
simply a sale: It has targeted a major customer that it would like to win and keep. The company
would like to show that it has the capabilities to serve the customer over the long haul in a
mutually profitable relationship.
Most companies today are moving away from transaction marketing, with its emphasis on making
a sale. Instead, they are practicing relationship marketing, which emphasizes maintaining profitable
long-term relationships with customers by creating superior customer value and satisfaction. They
are realizing that when operating in maturing markets and facing stiffer competition, it costs a lot
more to wrest new customers from competitors than to keep current customers.
Today's customers are large and often global. They prefer suppliers who can sell and deliver a
coordinated set of products and services to many locations. They favor suppliers who can quickly
solve problems that arise in their different parts of the nation or world, and who can work closely
with customer teams to improve products and processes. For these customers, the sale is only the
beginning of the relationship.
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Unfortunately, some companies are not set up for these developments. They often sell their
products through separate sales forces, each working independently to close sales. Their technical
people may not be willing to lend time to educate a customer. Their engineering, design, and
manufacturing people may have the attitude that "it's our job to make good products and the
salesperson's to sell them to customers." However, other companies are recognizing that winning
and keeping accounts requires more than making good products and directing the sales force to
close lots of sales. It requires a carefully coordinated whole-company effort to create value-laden,
satisfying relationships with important customers.
Relationship marketing is based on the premise that important accounts need focused and ongoing
attention. Studies have shown that the best salespeople are those who are highly motivated and
good closers, but more than this, they are customer problem solvers and relationship builders.
Good salespeople working with key customers do more than call when they think a customer
might be ready to place an order. They also study the account and understand its problems. They
call or visit frequently, work with the customer to help solve the customer's problems and improve
its business, and take an interest in customers as people.
g. Basic Sales Tasks
Order Getting: It is creative selling ad is
more time consuming. It is used for
??????
O rd e r --G e ttttiin g
selling products to new prospects
O rd e r G e  n g
(pioneers) and to sell to continuing
??????
customers (account managers). Some
times telemarketing is used particularly
??????
O rd e r --T a k iin g
O rd e r T a k n g
to small accounts for seeking customers,
??????
analyzing their problems, Discover
solutions and finally selling solutions to
??????
S u p p o rttiin g
Suppor ng
customers. Order Taking: This task is
related with very little creative selling,
used for Write up of orders, for
checking invoices for accuracy, to assure
timely order processing and may use suggestive selling for different problems that is supporting the
customers in acquiring solution for problem.
h. The advantages of personal selling
The advantages of personal selling over the other promotion tools...
 It can be adapted for individual customers.
 It can be focused on prospective customers.
 It results in the actual sale, while most other forms of promotion are used in moving the
customer closer to the sale.
i. The disadvantages of personal selling
 The major disadvantages of the personal selling are:
 Expensive per contact
 Many sales calls may be needed to generate a single sale
 Labor intensive
 It is costly to develop and operate a sales force.
 It may be difficult to attract high-caliber people.
j. Types of the personal selling
There are two types of personal selling:
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Principles of Marketing ­ MGT301
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The customers come to the salespeople.
Mostly involves retail-store selling. Most salespeople fall into this category.
The salespeople go to the customers.
Usually represent producers or wholesaling middlemen and sell to business users. Some outside
selling is relying more on telemarketing.
k. Characteristics of Professional Selling
Sales reps engage in a total selling job. Reps work closely with customers. Sales reps organize much
of their own time and effort. They often experience role ambiguity and role conflict.
l. Contributions of Personal Selling to Marketing:
Today, most professional salespeople are well-educated, well-trained men and women who work to
build long-term, value-producing relationships with their customers. They succeed not by taking
customers in but by helping them out--by
assessing customer needs and solving customer
problems. Success in a selling environment requires
P ro d u c iin g
M e e tiin g
P ro d u c n g
M eet ng
careful teamwork among well-trained, dedicated
S a lle s
B u ye r
Sa es
B u ye r
R e ven u e
E x p e c ta tiio n s
R e ven u e
E x p e c ta t o n s
sales professionals who are bent on profitably
taking care of their customers
P ro v iid iin g
P ro v d n g
m. Changing patterns in personal selling
M a rk e tp lla c e
M a rk e tp a c e
IIn fo rm a tiio n
Traditionally, personal selling has been a face-to-
n fo rm a t o n
face, one-on-one situation. But now new trends
and patterns are emerging which are:
­Selling Centers -- Team Selling
­Systems Selling
­Global Sales Teams
­Relationship Selling
­Telemarketing
n. Salesperson Attributes:
Salesperson is an individual( like: Serving, and Information gathering Salespeople, sales
representatives, account executives, sales consultants, sales engineers, agents, district managers,
marketing representatives, account development reps, etc) acting for a company by performing one
or more of the following activities.
Salesperson is an individual acting for
C u s tto m e rr--
Cus om e
a company by performing one or more
O rriie n tte d
O en ed
of the following activities:
Prospecting, The first step in the
selling  process  is  prospecting--
L iik a b lle
H o n e s tt
Hones
L kab e
identifying
qualified
potential
customers. Approaching the right
potential customers is crucial to selling
success. Than during the presentation
step of the selling process, the
D e p e n d a b lle
C o m p e tte n tt
salesperson tells the product "story" to
Dependab e
Com pe en
the buyer, showing how the product
will make or save money. The
salesperson describes the product features but concentrates on presenting customer benefits.
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Principles of Marketing ­ MGT301
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Using a need-satisfaction approach, the salesperson starts with a search for the customer's needs by
getting the customer to do most of the talking. To be more effective in this process sales person
should possess certain attributes, they should be honest should be competent to demonstrate the
products and handle objections should be customer oriented so tat customers can be satisfied,
should possess the skills so that potential customers are ready to listen about the offered products.
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Table of Contents:
  1. PRINCIPLES OF MARKETING:Introduction of Marketing, How is Marketing Done?
  2. ROAD MAP:UNDERSTANDING MARKETING AND MARKETING PROCESS
  3. MARKETING FUNCTIONS:CUSTOMER RELATIONSHIP MANAGEMENT
  4. MARKETING IN HISTORICAL PERSPECTIVE AND EVOLUTION OF MARKETING:End of the Mass Market
  5. MARKETING CHALLENGES IN THE 21st CENTURY:Connections with Customers
  6. STRATEGIC PLANNING AND MARKETING PROCESS:Setting Company Objectives and Goals
  7. PORTFOLIO ANALYSIS:MARKETING PROCESS,Marketing Strategy Planning Process
  8. MARKETING PROCESS:Analyzing marketing opportunities, Contents of Marketing Plan
  9. MARKETING ENVIRONMENT:The Companyís Microenvironment, Customers
  10. MARKETING MACRO ENVIRONMENT:Demographic Environment, Cultural Environment
  11. ANALYZING MARKETING OPPORTUNITIES AND DEVELOPING STRATEGIES:MIS, Marketing Research
  12. THE MARKETING RESEARCH PROCESS:Developing the Research Plan, Research Approaches
  13. THE MARKETING RESEARCH PROCESS (Continued):CONSUMER MARKET
  14. CONSUMER BUYING BEHAVIOR:Model of consumer behavior, Cultural Factors
  15. CONSUMER BUYING BEHAVIOR (CONTINUED):Personal Factors, Psychological Factors
  16. BUSINESS MARKETS AND BUYING BEHAVIOR:Market structure and demand
  17. MARKET SEGMENTATION:Steps in Target Marketing, Mass Marketing
  18. MARKET SEGMENTATION (CONTINUED):Market Targeting, How Many Differences to Promote
  19. Product:Marketing Mix, Levels of Product and Services, Consumer Products
  20. PRODUCT:Individual product decisions, Product Attributes, Branding
  21. PRODUCT:NEW PRODUCT DEVELOPMENT PROCESS, Idea generation, Test Marketing
  22. NEW PRODUCT DEVELOPMENT:PRODUCT LIFE- CYCLE STAGES AND STRATEGIES
  23. KEY TERMS:New-product development, Idea generation, Product development
  24. Price the 2nd P of Marketing Mix:Marketing Objectives, Costs, The Market and Demand
  25. PRICE THE 2ND P OF MARKETING MIX:General Pricing Approaches, Fixed Cost
  26. PRICE THE 2ND P OF MARKETING MIX:Discount and Allowance Pricing, Segmented Pricing
  27. PRICE THE 2ND P OF MARKETING MIX:Price Changes, Initiating Price Increases
  28. PLACE- THE 3RD P OF MARKETING MIX:Marketing Channel, Channel Behavior
  29. LOGISTIC MANAGEMENT:Push Versus Pull Strategy, Goals of the Logistics System
  30. RETAILING AND WHOLESALING:Customer Service, Product Line, Discount Stores
  31. KEY TERMS:Distribution channel, Franchise organization, Distribution center
  32. PROMOTION THE 4TH P OF MARKETING MIX:Integrated Marketing Communications
  33. ADVERTISING:The Five Mís of Advertising, Advertising decisions
  34. ADVERTISING:SALES PROMOTION, Evaluating Advertising, Sales Promotion
  35. PERSONAL SELLING:The Role of the Sales Force, Builds Relationships
  36. SALES FORCE MANAGEMENT:Managing the Sales Force, Compensating Salespeople
  37. SALES FORCE MANAGEMENT:DIRECT MARKETING, Forms of Direct Marketing
  38. DIRECT MARKETING:PUBLIC RELATIONS, Major Public Relations Decisions
  39. KEY TERMS:Public relations, Advertising, Catalog Marketing
  40. CREATING COMPETITIVE ADVANTAGE:Competitor Analysis, Competitive Strategies
  41. GLOBAL MARKETING:International Trade System, Economic Environment
  42. E-MARKETING:Internet Marketing, Electronic Commerce, Basic-Forms
  43. MARKETING AND SOCIETY:Social Criticisms of Marketing, Marketing Ethics
  44. MARKETING:BCG MATRIX, CONSUMER BEHAVIOR, PRODUCT AND SERVICES
  45. A NEW PRODUCT DEVELOPMENT:PRICING STRATEGIES, GLOBAL MARKET PLACE