1

Lamb, Hair, McDaniel

CHAPTER 18

Sales Promotion and Personal Selling

2

Sales Promotion

Marketing

communication

activities, other than

advertising, personal

selling, and public

relations, in which a

short-term incentive

motivates a purchase.

SalesPromotion

SalesPromotion

3

Objectives of Sales Promotion

Type of BuyerType of Buyer

Loyal Customers

Competitor’sCustomers

Brand Switchers

Price Buyers

Desired ResultsDesired Results

• Reinforce behavior• Increase consumption• Change purchase timing

• Break loyalty• Persuade to switch

• Persuade to buy your brand more often

• Appeal with low prices

• Supply added value

Sales PromotionSales PromotionExamples Examples

• Loyalty marketing• Bonus packs

• Sampling• Sweepstakes,

contests, premiums

• Price-lowering promotion

• Trade deals

• Coupons, price-offpackages, refunds

• Trade deals

4

Tools for Consumer Sales Promotion

Coupons and RebatesCoupons and Rebates

PremiumsPremiums

Loyalty Marketing ProgramsLoyalty Marketing Programs

Contests & SweepstakesContests & Sweepstakes

SamplingSampling

Point-of-Purchase PromotionPoint-of-Purchase Promotion

5

Tools for Consumer Sales Promotion

CouponCoupon

RebateRebate

PremiumPremium

A certificate that entitles consumers to an immediate

price reduction.

A certificate that entitles consumers to an immediate

price reduction.

A cash refund given for the purchase of a product during

a specific period.

A cash refund given for the purchase of a product during

a specific period.

An extra item offered to the consumer, usually in exchange

for some proof of purchase.

An extra item offered to the consumer, usually in exchange

for some proof of purchase.

6

Tools for Consumer Sales Promotion

LoyaltyMarketingProgram

LoyaltyMarketingProgram

A promotional program designed to build long-term, mutually beneficial relationships between a company and key customers.

A promotional program designed to build long-term, mutually beneficial relationships between a company and key customers.

FrequentBuyer

Program

FrequentBuyer

Program

A loyalty program in which loyal consumers are rewarded for making multiple purchases.

A loyalty program in which loyal consumers are rewarded for making multiple purchases.

7

Tools for Consumer Sales Promotion

ContestsContests Promotions that require skill or ability to compete for prizes.

Promotions that require skill or ability to compete for prizes.

SweepstakesSweepstakes Promotions that depend on chance or luck, with free participation.

Promotions that depend on chance or luck, with free participation.

Tools for Consumer Sales Promotion

SamplingSamplingA promotional program that allows the consumer the opportunity to try a product or service for free.

A promotional program that allows the consumer the opportunity to try a product or service for free.

9

Point-of-Purchase Promotion

Build traffic

Advertise the product

Induce impulse buying

10

Online Sales Promotion

Effective Types of Online Sales PromotionEffective Types of Online Sales Promotion

Free merchandise

Sweepstakes

Free shipping with purchases

Coupons

11

Trade Sales Promotion

Trade AllowancesTrade Allowances

Push MoneyPush Money

TrainingTraining

Free MerchandiseFree Merchandise

Store DemonstrationStore Demonstration

Conventions & Trade ShowsConventions & Trade Shows

12

Personal Selling

Personal Selling is more important if...

Customers are concentrated.

Customers are concentrated.

Product is technically complex.

Product is technically complex.

There are few customers.There are few customers.

Product is custom made.Product is custom made.

Product has a high value.Product has a high value.

Customers are geographically dispersed.

Customers are geographically dispersed.

Product is simple to understand.

Product is simple to understand.

There are many customers.There are many customers.

Product is standardized.Product is standardized.

Product has a low value.Product has a low value.

Advertising & Sales Promotion are more important if...

13

Relationship Selling

A sales practice that involves building, maintaining, and enhancing interactions with customers in order to develop long-term satisfaction through mutually beneficial partnerships.

Relationship(Consultative)

Selling

Relationship(Consultative)

Selling

14

Traditional Selling and Relationship SellingTraditionalTraditional

Personal SellingPersonal Selling

LO5

Sell advice, assistance, counsel Sell products

Focus on closing sales

Limited sales planning

Discuss product

Assess “product-specific” needs

“Lone wolf” approach

Pricing/product focus

Short-term sales follow-up

Focus on customer’s bottom line

Sales planning is top priority

Build problem-solving environment

Conduct discovery in scope of operations

Team approach

Profit impact and strategic benefit focus

Long-term sales follow-up

Relationship SellingRelationship Selling

15

Steps in the Selling Process

Qualifying Leads

Approaching Customer

Developing and proposing solutions

Handling objections

Closing the sale

Generating Leads

A Continuing Process

16

Powerful PresentationsBe well prepared

Use eye contact

Ask open-ended questions

Be poised

Use hand gestures and voice inflection

Focus on the customer needs

Incorporate visual elements

Know how to operate the A/V equipment

Make sure the equipment works

PRACTICE, PRACTICE, PRACTICE!

17

The Impact of Technology on Personal Selling

Cell phonesCell phones

LaptopsLaptops

PagersPagers

E-MailE-Mail

Electronic organizersElectronic organizers

InternetInternet

Ch 18 Discussion Questions

1. What is sales promotion? Explain how various tools for consumer sales promotion influence behavior.

2. Explain how various tools for trade sales promotion affect the channel behavior.

3. What is personal selling? When should we use personal selling over sales promotion or advertising?

4. Differentiate between relationship selling and personal traditional selling.

5. Explain the steps involved in Personal Selling.