The Role of Selling in Marketing

XMB554Week 2

What is not Marketing?

http://www.ted.com/talks/lang/tr/dan_cobley_what_physics_taught_me_about_marketing.html

What is Marketing?

Managing Profitable Customer Relationships

•Attracting new customers•Retaining and growing current customers

What is Marketing?

The process of building profitable customer relationships by creating value for customers and capturing value in return.

Costs Benefits

Customer Perceived Value

Marketing Management

Marketing management is the art and science of choosing target markets and building profitable relationships with them– What customers will we serve?– How can we best serve these customers?

Marketing Management

Where you are Where you want to be

How you go there

Marketing Plan

Marketing Management Philosophies

Production

Product

Sales

Marketing

What can we make or do best?

How can we make the best product?

How can we sell more aggressively?

What do customerswant and need?

Orientation Focus

Marketing Strategy and Sales Management

The War Between Sales & Marketing

Relationship between Sales and Marketing

• Marketing function takes different roles in different companies

• The strains between Sales and Marketing fall into 2 main categories: economic and cultural

• It is not difficult for companies to assess the quality of the working relationship between Sales and Marketing

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Different Roles for Marketing

Small businesses • Don’t establish a formal marketing group.• Marketing means selling.• Eventually, add a marketing person to help sales

force: measure the size of the market, identifying best channels, or determining motives of potential buyers; develop materials to attract customers and close sales.

• At this stage, the relationship is usually positive.

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Different roles for marketingAs companies become larger and more successful • Marketing is more than just selling.• Hire marketers, marketing becomes an independent player• Marketing competes with Sales for funding• Disagreements arise

– Salespeople wish that marketers should worry about opportunities (long-terms strategy) and leave the current opportunities (individual and group sales) to them.

– Marketers believe it’s essential to transform the organization into a marketing-led company.

– Sales group question whether the marketers have the competencies, experience and understanding to lead the organization.

The War Between Sales & Marketing

Why can’t they just get along?

Economic friction is generated by the need to divide the total budget.

Sales criticize how Marketing spends money on the pricing, promotion and product.

Marketing wants the sales force to “sell the price” as opposed to “selling through price”.

Marketing is responsible for setting retail or list prices, and establish promotional pricing.

The salespeople usually favor lower prices to sell the product more easily.

Sales has the final say over transactional pricing

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Why can’t they just get along?

• Marketers had more formal education than sales people.

• Highly analytical, data oriented and project focused.

• Judge performance of project with a cold eye.

• Build competitive advantage for the future

• They spend their time talking to existing and potential customers

• Skilled relationship builders• Are in the field not behind a desk• Are used to rejection and it does not

depress them• Live for closing a sale

Cultural conflict arises from the fact that two functions attract people who spend their time in different ways

How well do Sales and Marketing Work Together?

UNDEFINED 20-39• They are independent: each has its own

tasks and agendas.• Each does not know about what the other

is up to.• Meetings are devoted to resolution of

conflicts rather than proactive cooperation.

DEFINED 40-59• They set up processes and rules to

prevent disputes.• They know who is supposed to do

what and stick to them• They work together on large events

like trade shows

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ALIGNED 60-79• Clear boundaries between two exist

but they are also flexible• They engage in joint planning and

training.• They work together on important

accounts

INTEGRATED 80-100• Boundaries become blurred.• They develop and implement

shared metrics• “Rise or fall together “culture

develops

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Do we need to be more aligned?

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How to move up?Defined Undefined Aligned

Create clear rules for engagemente.g., following up on sales leads

Encourage disciplined communicationCreate joint assignmentsAppoint a liaison from MarketingCollocate marketers and salespeopleImprove sales force feedback

Appoint a chief revenue (or customer) officerDefine the steps in the marketing and sales funnelsSpilt marketing into two groupsSet shared revenue targets and reward systemsIntegrate sales and Marketing metrics

move to Defined move to Integratedmove to Aligned

Encourage disciplined communication

• Hold regular meetings between Sales and Marketing

• Make sure that major opportunities and problems are on the agenda.

• Focus the discussions on action items that will resolve problems

• Develop guidelines that will indicate when and with whom they should communicate. “We will not go to print on any marketing

collateral until salespeople have reviewed it,”

“Marketing will be invited to the top ten critical account reviews.”

Establish an up-to-date, user-friendly “who to call” database.The War Between Sales & Marketing

Create joint assignments

• Marketers should occasionally go along on sales calls.

• Marketers should get involved with developing alternate solutions for customers, early in the sales process.

• Marketers should also participate important account-planning sessions.

• Salespeople should help to develop marketing plans and participate product-planning reviews.

• Salespeople should preview ad and sales-promotion campaigns.

• Salespeople should share knowledge about customers’ purchasing habits.

• They should plan events and conferences together.The War Between Sales & Marketing

Moving from defined to aligned What else?

• The liaison needs to be someone both groups trust.

• Should help to resolve conflicts and share with each group the tacit knowledge from the other group.

• Make Sales and Marketing people physically close, so that they will interact more often and are more likely to work well together.

• Encourage Sales and Marketing to share their experiences, ideas, and insights with each other

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Appoint a chief revenue officer

• Put both functions under one C-level executive.

• Companies such as Coca-Cola, and FedEx have a chief revenue officer (CRO) who is responsible for planning for and delivering the revenue needed to meet corporate objectives.

• Control the forces affecting revenue—specifically, marketing, sales, service, and pricing.

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The Buying Funnel

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Split marketing into two groups

• Downstream marketers develop advertising and promotion campaigns, collateral material, and sales tools.

• They help salespeople develop and qualify leads.

• They uses market research and feedback from the sales reps to help sell existing products in new market segments, to create new messages, and to design better sales tools.

• Upstream marketers engage in customer sensing.

• They monitor the voice of the customer and develop a long view of the company’s business opportunities and threats.

• They shares its insights with senior managers and product developers and participates in product development.

The War Between Sales & Marketing

Practical Exercise Discussion Questions

• Determine the type of relationship between Sales and Marketing departments in your company.

• Is there any significant difference between sales and marketing forces about how well they work together? If there is, where the difference is derived from?

• Discuss how a stronger alignment between the two groups can be created.