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

Chapter TwoChapter Two

Adjusting to the Adjusting to the Dynamic Dynamic

Personal Selling Personal Selling EnvironmentEnvironment

PowerPoint presentation prepared byDr. Rajiv Mehta

Copyright © Houghton Mifflin Company. All rights reserved. Chapter 2 | Slide 2

Learning ObjectivesLearning Objectives

• Megatrends affecting personal selling. Megatrends affecting personal selling. • Adapting to megatrends. Adapting to megatrends. • Professional salespeople as micro-Professional salespeople as micro-

marketing managers.marketing managers.• What megatrends are affecting personal What megatrends are affecting personal

selling now and what megatrends will selling now and what megatrends will affect personal selling in the foreseeable affect personal selling in the foreseeable future.future.

• How “online” sales channels are How “online” sales channels are empowering customers, especially giant empowering customers, especially giant retailers.retailers.

After reading this chapter, you should understand:After reading this chapter, you should understand:

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Learning Objectives Learning Objectives cont’dcont’d

• How developments in telecommunications How developments in telecommunications technology are dramatically changing personal technology are dramatically changing personal selling. selling.

• Why rising personal selling costs are Why rising personal selling costs are encouraging salespeople and their companies encouraging salespeople and their companies to make increasing use of alternative direct-to make increasing use of alternative direct-marketing techniques.marketing techniques.

• What current trends in information management What current trends in information management will affect how salespeople do their jobs.will affect how salespeople do their jobs.

• Why today’s professional salespeople need to Why today’s professional salespeople need to be much like micro-marketing managers in their be much like micro-marketing managers in their expanding roles.expanding roles.

After reading this chapter, you should understand:After reading this chapter, you should understand:



Megatrends Affecting Megatrends Affecting Personal SellingPersonal Selling

Salespeople must adapt to 3 major megatrends to enhance their Salespeople must adapt to 3 major megatrends to enhance their effectiveness and efficiency:effectiveness and efficiency:

1. Behavioral forces1. Behavioral forces

2. Technological forces2. Technological forces

3. Managerial forces3. Managerial forces



Megatrends: Behavioral ForcesMegatrends: Behavioral Forces


Megatrends: Behavioral Forces Megatrends: Behavioral Forces cont’dcont’d

• Buyers’ attitudes, preferences, and behaviors are changing, necessitating Buyers’ attitudes, preferences, and behaviors are changing, necessitating salespeople to modify their selling strategies and approaches.salespeople to modify their selling strategies and approaches.

• More expert and demanding buyers

• Rising customer expectations

• Micro-segmentation of domestic markets

• Expanding power of giant retailers

• Globalization of markets

• Empowerment of customers

Behavioral forces include:

Chapter Review Question:What specific market and competitive forces are changing personal selling and buyer-seller relationships? What are their effects?



Megatrends: Megatrends: Empowerment of CustomersEmpowerment of Customers


Megatrends: Technological ForcesMegatrends: Technological Forces


• Today’s successful salespeople are those who can make skillful and efficient Today’s successful salespeople are those who can make skillful and efficient use of technology to increase their efficiency and productivity in serving use of technology to increase their efficiency and productivity in serving customers.customers.

Megatrends: Technological Forces Megatrends: Technological Forces cont’dcont’d

• Sales force automation

• Virtual sales offices (home, automobile, or virtually anywhere)

• Electronic commerce

Technological forces include:

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.

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Megatrends: Technological Forces Megatrends: Technological Forces cont’dcont’d

Among the most important of the technological Among the most important of the technological innovations in sales force automation include: innovations in sales force automation include:

Sales Force AutomationSales Force Automation

Virtual Sales OfficesVirtual Sales Offices Electronic CommerceElectronic Commerce

• Portable computers

• Electronic data interchange

• Videoconferencing

• Multifunction cell phones and satellite pagers

• Voice mail and Electronic mail

• Instant messaging

• Home

• Office

• Virtually Anywhere

• Internet:• Blogs, Podcasting

• Screen-Sharing, WebEx

• Intranet

• Extranet


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Megatrends: Managerial ForcesMegatrends: Managerial Forces


Megatrends: Managerial Forces Megatrends: Managerial Forces cont’dcont’d

• In response to the dynamic behavioral and technological megatrends, In response to the dynamic behavioral and technological megatrends, sales organizations are trying various strategies to achieve profitable sales organizations are trying various strategies to achieve profitable sales growth and closer customer relationshipssales growth and closer customer relationships

• Efforts to reduce selling costs

• Shift to direct marketing alternatives

• Certification of salespeople

Managerial forces include:

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• 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).

Efforts to Reduce Selling CostsEfforts to Reduce Selling Costs

Chapter Review Question:What are some companies doing to reduce selling costs?

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• To sell to organizational To sell to organizational buyers, several direct buyers, several direct marketing alternatives support marketing alternatives support or bypass field salespeople: or bypass field salespeople:

Shift to Direct Marketing AlternativesShift to Direct Marketing Alternatives

1.1. Direct mailDirect mail 2.2. Telemarketing, which Telemarketing, which

includes:includes: • TelesellingTeleselling• Kiosks (or “computer Kiosks (or “computer

salespeople”) salespeople”) • FacsimileFacsimile• Personalized emailPersonalized email

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?

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Figure 2.1: Telemarketing Applications, Figure 2.1: Telemarketing Applications, Advantages, and DisadvantagesAdvantages, and Disadvantages


Megatrends: Managerial ForcesMegatrends: Managerial Forces

• Because of the public’s negativism toward personal selling, efforts have been directed at certifying sales personnel

Certification of SalespeopleCertification of Salespeople

• 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

Chapter Review Question:Describe the three broad megatrends affecting personal selling.



Adapting to MegatrendsAdapting to Megatrends

• Salespeople and their companies Salespeople and their companies can adapt to megatrends using can adapt to megatrends using various information management various information management toolstools

• Behind the forces that are Behind the forces that are influencing salespeople and the way influencing salespeople and the way they operate are four key trends in they operate are four key trends in the management of information: the management of information:

• (1) Database marketing (1) Database marketing

• (2) Data warehousing (2) Data warehousing

• (3) Push technology(3) Push technology

• (4) Data mining (4) Data mining Royalty-Free, Digital Vision/Getty Images


Four Major Trends in Four Major Trends in Information ManagementInformation Management

1. Database marketing: A database is a large computerized file of customers’ and potential customers’ profiles and purchase patterns.

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.

2. Data warehousing: A very large, corporate-wide database, built with data from a number of information systems already in place in the company.

3. Data mining: Refers to the process of using statistical analysis to detect relevant patterns or relationships between and among variables in a database.

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 e-mail combined with data warehousing to discern what your customers need and exactly when they need it.

4. Push technology: Push technology is the latest iteration of e-mail combined with data warehousing to discern what your customers need and exactly when they need it.

Chapter Review Question:

How are information management trends affecting salespeople?


Information management and relationship selling go hand-Information management and relationship selling go hand-in-hand as part of the evolutionary development of a in-hand as part of the evolutionary development of a marketing strategy used in marketing strategy used in one-to-one marketingone-to-one marketing and by and by salespersons as salespersons as one-to-one relationship builders.one-to-one relationship builders.

Information Management and Information Management and Relationship SellingRelationship Selling


Concentrates on selling more goods, more profitably, to fewer selected customers (instead of selling more goods to more customers)

Information Management and Information Management and Relationship Selling Relationship Selling cont’dcont’d

Building trust and long-term relationships with customers determines the success of one-to-one marketing strategies, especially in business-to-business markets

One-to-one marketing:One-to-one marketing:

Salespeople as one-to-one relationship builders:




Professional Salespeople asProfessional Salespeople asMicro-Marketing Managers Micro-Marketing Managers cont’dcont’d

• In addition to selling products, today’s sales representatives must serve customers as 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 consultants by offering expert advice for making a customer’s business operations more profitableprofitable

• 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

Salespeople offer expert advice on:Salespeople offer expert advice on:

Chapter Review Question:Why must today’s professional salesperson learn to function more like a micro-marketing manager in the field?


Chapter Review QuestionsChapter Review Questions

1.1. Why do some companies see selling in the United States as Why do some companies see selling in the United States as increasingly like selling internationally?increasingly like selling internationally?

2.2. Describe the type of assistance that salespeople may receive from Describe the type of assistance that salespeople may receive from the company’s telemarketing staff. What can field salespeople do to the company’s telemarketing staff. What can field salespeople do to increase the benefits they derive from telemarketers?increase the benefits they derive from telemarketers?


Topics for Thought and Topics for Thought and Class DiscussionClass Discussion

1.1. Which of the advances in telecommunications and Which of the advances in telecommunications and computer technology do you think will provide the most computer technology do you think will provide the most help to salespeople over the next decade?help to salespeople over the next decade?

2.2. Discuss how you think salespeople can take Discuss how you think salespeople can take advantage of each of the phenomena taking place advantage of each of the phenomena taking place under the managerial megatrend.under the managerial megatrend.

3.3. How do you think the rising cost of personal selling and How do you think the rising cost of personal selling and the growth of direct-marketing techniques will affect the growth of direct-marketing techniques will affect salespeople? salespeople?


Internet ExercisesInternet Exercises

1.1. Many major companies sell more products and services Many major companies sell more products and services online via e-commerce than they do in traditional brick-online via e-commerce than they do in traditional brick-and-mortar stores or outlets. Check out the websites of and-mortar stores or outlets. Check out the websites of each of the following companies and see whether they each of the following companies and see whether they offer purchasing options online. Also, try to find out offer purchasing options online. Also, try to find out their dollar sales volumes online and off-line compare. their dollar sales volumes online and off-line compare.

• Cisco Systems (www.cisco.com) Cisco Systems (www.cisco.com) • Williams-Sonoma (www.williams-sonoma.com) Williams-Sonoma (www.williams-sonoma.com) • Pitney Bowes (www.pitneybowes.com) Pitney Bowes (www.pitneybowes.com) • Staples (www.staples.com)Staples (www.staples.com)


Internet Exercises Internet Exercises cont’dcont’d

2.2. Salespeople need to keep up with the latest technologies (including Salespeople need to keep up with the latest technologies (including computer software) that might affect how they do their sales jobs. Go computer software) that might affect how they do their sales jobs. Go to the following websites, or to other professional selling-related to the following websites, or to other professional selling-related websites, and find three innovations that you think will help websites, and find three innovations that you think will help salespeople become more effective and efficient. Describe these salespeople become more effective and efficient. Describe these innovations, and explain why you feel each will increase salesperson innovations, and explain why you feel each will increase salesperson productivity.productivity.

• Sales and Marketing Management Sales and Marketing Management (www.salesandmarketing.com/smm/index.jsp)(www.salesandmarketing.com/smm/index.jsp)

• Siebel Systems (www.siebel.com)Siebel Systems (www.siebel.com)• SalesForce.com (www.salesforce.com)SalesForce.com (www.salesforce.com)• SellingPower.com (www.sellingpower.com)SellingPower.com (www.sellingpower.com)


Projects For Personal Growth Projects For Personal Growth

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


Projects For Personal Growth Projects For Personal Growth cont’dcont’d

2.2. Ask two business-to-business salespeople about Ask two business-to-business salespeople about telecommunication use in their sales work. What SFA telecommunication use in their sales work. What SFA equipment has been most helpful to them? Why? How equipment has been most helpful to them? Why? How have their companies assisted them in selling and in have their companies assisted them in selling and in serving prospects and customers? What other equipment serving prospects and customers? What other equipment would they like? What other support would they like from would they like? What other support would they like from their companies in helping them work with prospects and their companies in helping them work with prospects and customers? customers?


Case 2.1: Savoring Success and Case 2.1: Savoring Success and Contemplating the FutureContemplating the Future

1.1. Do you think the use of high-tech equipment—laptop Do you think the use of high-tech equipment—laptop computers, cell phones, pagers, and the like—will help the computers, cell phones, pagers, and the like—will help the young saleswomen appear more professional?young saleswomen appear more professional?

2.2. Assume you are a friend of one of the women. What five Assume you are a friend of one of the women. What five ideas would you give her about using the Internet and ideas would you give her about using the Internet and other telecommunication tools to make her more effective other telecommunication tools to make her more effective and efficient in her sales assignments?and efficient in her sales assignments?


Case 2.1: Savoring Success and Case 2.1: Savoring Success and Contemplating the FutureContemplating the Future cont’dcont’d

3.3. Are the women’s ideas about making their sales jobs Are the women’s ideas about making their sales jobs easier realistic? Which ones make the most sense? easier realistic? Which ones make the most sense? Which ones make the least sense? Could the company Which ones make the least sense? Could the company provide a lot of this information for customers on an provide a lot of this information for customers on an extranet or on the Internet?extranet or on the Internet?

4.4. Do the women have an accurate understanding of what Do the women have an accurate understanding of what many salespeople are expected to do today? Why or many salespeople are expected to do today? Why or why not? What can the company do to help its why not? What can the company do to help its salespeople handle their expanded roles?salespeople handle their expanded roles?


Case 2.1: Savoring Success and Case 2.1: Savoring Success and Contemplating the FutureContemplating the Future cont’dcont’d

5.5. In their conversation, do the women seem unnecessarily concerned In their conversation, do the women seem unnecessarily concerned about taking on their new territorial assignments? Do you think any about taking on their new territorial assignments? Do you think any special issues arise for saleswomen but not for salesmen? Why or special issues arise for saleswomen but not for salesmen? Why or why not?why not?


Case 2.2: We’re Trying To Cut Costs ... Case 2.2: We’re Trying To Cut Costs ... We Can’t Afford Laptops Now!We Can’t Afford Laptops Now!

1.1. Which customers would you advise Russ to call on with Which customers would you advise Russ to call on with Homer?Homer?

2.2. What should Russ say to Homer about purchasing What should Russ say to Homer about purchasing laptop computers for the full-time sales force? Do you laptop computers for the full-time sales force? Do you think S&B should buy laptop computers for the fifteen think S&B should buy laptop computers for the fifteen manufacturers’ reps, too? Would any other equipment manufacturers’ reps, too? Would any other equipment aid personal selling at S&B? If so, should S&B be asked aid personal selling at S&B? If so, should S&B be asked to purchase it for the salespeople?to purchase it for the salespeople?

3.3. How might Russ recommend buying laptop computers How might Russ recommend buying laptop computers without Homer seeing it as running counter to S&B’s without Homer seeing it as running counter to S&B’s current cost-reduction push? Will the laptops pay off for current cost-reduction push? Will the laptops pay off for S&B? Could the company expand its markets through S&B? Could the company expand its markets through the use of computers and email?the use of computers and email?

Case 2.2 is found online at http://college.hmco.com/pic/andersonps2e.

http://college.hmco.com/pic/andersonps2e






Case 2.2: We’re Trying To Cut Costs ... Case 2.2: We’re Trying To Cut Costs ... We Can’t Afford Laptops Now!We Can’t Afford Laptops Now! cont’dcont’d

4.4. Do you think Russ should consider looking for another job now? Do you think Russ should consider looking for another job now? Why or why not?Why or why not?

5.5. If Homer were to retire and recommend Russ as his successor, If Homer were to retire and recommend Russ as his successor, what actions would you advise for Russ if he became S&B’s what actions would you advise for Russ if he became S&B’s regional sales manager? How else, besides making field sales regional sales manager? How else, besides making field sales calls, might S&B reach prospects and customers? How well would calls, might S&B reach prospects and customers? How well would the current salespeople accept your suggestions? How would you the current salespeople accept your suggestions? How would you address their concerns?address their concerns?

6.6. What other situations and possible questions should Russ prepare What other situations and possible questions should Russ prepare for during his five days traveling with Homer?for during his five days traveling with Homer?

Documents

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