Kotler • Keller

Kotler • KellerPhillip Kevin Lane

Marketing Management • 14e

Managing Personal Communications:Direct and Interactive Marketing, Word of Mouth and Personal Selling

Chapter 19

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Discussion Questions

1. How can companies conduct direct marketing for competitive advantage?

2. How can companies carry out effective interactive marketing?

3. How does word of mouth affect marketing success?

4. What decisions do companies face in designing and managing a sales force?

5. How can salespeople improve their selling, negotiating, and relationship marketing skills?

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Direct Marketing

Catalogs and Kiosks

Telemarketing

Interactive TV

Mobile Devices

Web Sites

Direct Mail

Defined

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The use of consumer-direct (CD)channels to reach and deliver goods and services to customers without using marketing middlemen.

Direct Marketing

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Benefits of Direct Marketing

Consumers

Market Demassification

Selective targetingPersonalized messagesMeasure effectiveness

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Direct Mail

Target market selectivity Measureable

Higher CPM

Flexible

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Objectives

Objectives• Sales Order

• Prospect Leads

• Customer Relationships

• Inform and Educate

• Reinforce Recent Purchases

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Target Markets and Prospects

RFM Formula

•Recency

•Frequency

•Monetary amount

Identify Prospects

•Demographics

•Lifestyle

•Previous purchases

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Offer Elements

Offer strategy

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Testing and Measuring

Testing• Product

• Features

• Copy platform

• Mailer type

• Envelope

• Prices

• Mailing lists

Measuring• Campaign costs

• Returned merchandise

• Bad debt

• Customer lifetime value

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Catalog Marketing

Catalog Types

•Full-line

•Specialty consumer

•Business

Top B-to-C catalog sellers Dell - $51 billionStaples - $8.9 billionCDW - $8.1 billion

Print and Online Catalogs

• 16,000 companies

• $235 billion in sales

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Telemarketing

Attract prospects

Sell to existing customers

Take orders

Answer questions

Inbound

Outbound

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Public and Ethical IssuesIrritation

Unfairness

Deception and FraudInvasion of Privacy

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Interactive Marketing

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Advantages and Disadvantages

Online Communities

Contextual Placement

Measureable

Screen out message

Loss of control

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Figu

re

19.1 Daily Usage of Select Media

Online 4:13

TV/Video 3:17

Music/Radio 1:26

Mobile Phone 1:18

Landline Phone 0:36

Gaming 0:36

Reading 0:24

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Interactive Marketing Options

Web Sites & Display Ads

Search Ads

Mobile Marketing

E-Mail

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Word of Mouth

Social Media

Buzz and Viral Marketing

Opinion Leaders

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Social Media

Online Communities and Forums

Social Networks

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Buzz and Viral Marketing

Buzz Marketing

Viral Marketing

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Opinion Leaders

Mavens

Salesmen

Connectors

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Designing the Sales ForceDeliverer

Solution Vendor

TechnicianMissionary

One Day OnlySPECIAL OFFER

Demand Creator

Order Taker

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Figu

re

19.3

Designing the Sales Force

Objectives

Strategy

Structure

Size

Compensation

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Sales Force Objectives and Strategy

Servicing

ProspectingTargeting

Allocating

Information

Gathering

Communicating

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Sales Force Structure

Territorial

Product or Market

Strategic

Inside Sales Force

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Sales Force SizeWorkload ApproachGroup customers

(sales volume)

Determine Average No. of Sales Calls

Accounts x Frequency

Establish Call Frequency

Calls Required / Average Sales Calls

1,000 - A Accounts2,000 - B Accounts

A Accounts – 36 callsB Accounts – 12 calls

A Accounts – 36,000B Accounts – 24,000Total Calls – 60,000

Average Rep – 1,000 calls

60,000/1,000 = 60 reps

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Sales Force Compensation

Regular Income

Rewards

Fair pay

Control

Economy

Simplicity

Compensation Components• Fixed amount

(salary)

• Variable amount (commission or bonus)

• Expense allowances

• Benefits

TRENDS

Profitability

Customer Satisfaction

Customer Retention

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Figu

re

19.3

Managing the Sales Force

Recruiting

Training

Supervising

Motivating

Evaluating

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Recruiting and Selecting

• Referrals

• Agencies

• Classifieds

• Career Fairs

20% Turnover

• Formal Tests

• Simulations

Recruiting Methods

Selection Criteria

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Training and Supervising

28 weeks – Industrial products

12 weeks – Service companies

4 weeks – Consumer products

Time in Training

Computer-based

Video

Role Playing

Training Methods

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Sales Rep Productivity

Norms for Prospect Calls

New Accounts

Current Accounts Using Sales Time Wisely

Sales Technology

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MotivatingIntrinsic Rewards

Extrinsic Rewards

Sales Quotas

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Evaluating

Sales Performance Indicators• Calls per day• Call time per contact• Revenue per sales call• Cost per sales call• Entertainment cost per call• % of orders per 100 calls• New customers per period• Lost customers per period• Sales force cost as a percent of

total sales

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Principals of Personal Selling

SPIN

Situation Questions

Problem Questions

Implication Questions

Need-payoff Questions

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Figu

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19.6

Major Steps in Effective SellingProspecting and

Qualifying

Overcome Objections

Presentation and Demonstration

Preapproach

Closing

Follow-up and Maintenance

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Prospecting and Qualifying

Hot Warm Cold

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Preapproach

• Product/Service Needs

• Decision Makers

Company Information

• Personal Characteristics

• Buying Style

Buyer Information

• Personal visit

• Phone call

• Letter

Contact Approach

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Presentation/Demonstration

FABV Approach

Features

Advantages

Benefits

Value

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Overcoming Objections

Psychological Resistance

Logical Resistance

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Closing

Ask for the orderRecapitulate points of agreementGain agreement on minor points

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Follow-up and Maintenance