16

&17

Personal Selling

and

Direct and Online Marketing:

Building Direct Customer
Relationships
After studying this chapter, you should be able to:
1. Discuss the role of a company’s salespeople in creating
value for customers and building customer relationships

2. Identify and explain the six major force management

steps

3. Discuss the personal selling process, distinguishing

between transaction-oriented marketing and relationship
marketing

16-2
1. Personal Selling
2. The Personal Selling Process

16-3
 The Nature of Personal Selling

Examples of people who do the selling include:

• Salespeople
• Sales representatives
• District managers
• Account executives
• Sales engineers
• Agents
• Account development reps

16-4
 The Nature of Personal Selling

Salespeople can include an order taker such as

someone standing behind the counter or an
order getter whose position demands more
creative selling and relationship building

Personal selling is the interpersonal part of the

promotion mix and can include:
• Face-to-face communication
• Telephone communication
• Video or Web conferencing

16-5
 The Role of the Sales Force

Salespeople can be more effective than advertising

• Learn about customer problems and adjust the marketing

offer and presentation accordingly to meet the special
needs of each customer
• Representing the company to customers
• Representing customers to the company

16-7
 Managing the Sales Force

Sales force management is the analysis, planning,

implementation, and control of sales force
activities and includes:
• Designing the sales force strategy and structure
• Recruiting
• Selecting
• Training
• Compensating
• Supervising
• Evaluating

16-9
 Managing the Sales Force
Sales Force Structure

• Territorial sales force structure

• refers to a structure where each salesperson is assigned an
exclusive geographic area and sells the company’s full line of
products and services to all customers in that territory
• Product sales force structure
• refers to a structure where each salesperson sells along
product lines
• Customer sales force structure
• refers to a structure where each salesperson sells along
customer or industry lines
• Complex sales force structure
• refers to a structure where a wide variety of products is sold to
many types of customers over a broad geographic area and
combines several types of sales force structures

16-10
 Managing the Sales Force
Sales Force Size

Salespeople are one of the

company’s most productive and
expensive assets

Increases in sales force size can

increase sales and costs

16-15
 Managing the Sales Force
Other Sales Force Strategy and Structure Issues

Outside salespeople call on customers

in the field

Inside salespeople conduct business

from their offices
• Technical sales support people
• Sales assistants

16-18
 Managing the Sales Force
Other Sales Force Strategy and Structure Issues
Team selling is used to service large complex
accounts and can include experts from:
• Sales, Marketing, Technical , R&D, Engineering,
Operations and Finance

Some challenges of team selling

• Customers used to working with one salesperson may
become confused or overwhelmed
• Salespeople used to working alone can have difficulties
working with and trusting teams
• Evaluating individual contributions can lead to
compensation issues

16-20
 Recruiting and Selecting Salespeople

Issues in recruiting and selecting include:

Careful selection
• Increases sales performance
Poor selection
• Increases recruiting and training costs
• Lost sales
• Disrupts customer relationships

16-22
 Compensating Salespeople
Compensation is made up of:
• Fixed amounts - a salary, give the
salesperson some stable income

• Variable amounts - commission or

bonus based on sales performance;
rewards the salesperson for greater
effort and success

• Expenses

• Fringe benefits

16-23
 Supervising and Motivating Salespeople
The goal of supervision is to help
salespeople work smart by doing the
right things in the right ways
The goal of motivation is to encourage
salespeople to work hard and
energetically toward sales force goals

Sales morale and performance can be

increased through:
• Organizational climate - feelings
• Sales quotas
• Positive incentives – sales contest, sales
meeting
16-26
Evaluating Salespeople and Sales Force Performance

• Sales reports
• Call reports
• Expense reports

16-32
The goal of the personal selling
process is to get new customers
and obtain orders from them

16-33
 Steps in the Personal Selling Process
1. Prospecting and qualifying
2. Pre-approach
3. Approach
4. Presentation and demonstration
5. Handling objections
6. Closing
7. Follow-up

16-34
 Steps in the Personal Selling Process
Step 1

Prospecting identifies qualified

potential customers through
referrals from:
• Customers
• Suppliers
• Dealers
• Internet

16-35
 Steps in the Personal Selling Process
Step 1

Qualifying is identifying good

customers and screening out poor
ones by looking at:
• Financial ability
• Volume of business
• Needs
• Location
• Growth potential

16-36
 Steps in the Personal Selling Process
Step 2

Pre-approach is the process of

learning as much as possible
about a prospect, including
needs, who is involved in the
buying, and the characteristics
and styles of the buyers

16-37
 Steps in the Personal Selling Process
Step 2

In the pre-approach stage, the salesperson sets

call objectives and the best approach

Objectives Approaches
• Qualify the prospect • Personal visit
• Gather information • Phone call
• Make an immediate • Letter
sale

16-38
 Steps in the Personal Selling Process
Step 3

Approach is the process where the

salesperson meets and greets the
buyer and gets the relationship off
to a good start, and involves the
salesperson’s:
• Appearance
• Opening lines
• Follow-up remarks

Salesperson must listen to customers

Presentation, need satisfaction approach

16-39
 Steps in the Personal Selling Process
Step 4

Handling objections is the process where

salespeople resolve problems that are logical,
psychological, or unspoken

When handling objections from buyers, salespeople

should:
• Be positive
• Seek out hidden objections
• Ask the buyers to clarify any objections
• Take objections as opportunities to provide more
information
• Turn objections into reasons for buying

16-44
 Steps in the Personal Selling Process
Step 5

Closing is the process where

salespeople should recognize
signals from the buyer, including
physical actions, comments, and
questions to close the sale

16-45
 Steps in the Personal Selling Process
Step 5
Closing techniques can include:
• Asking for the order
• Reviewing points of agreement
• Offering to help write up the order
• Asking if the buyer wants this model
or another one
• Making note that the buyer will lose
out if the order is not placed now
• Offering incentives to buy, including
lower price or additional quantity

16-46
 Steps in the Personal Selling Process
Step 6

 Follow up is necessary if the salesperson

wants to ensure customer satisfaction and
repeat business
 Personal Selling and Customer Relationship
Management

Personal selling is a transaction-oriented

approach to close a specific sale with
a specific customer, with the long-
term goal to develop a mutually
profitable relationship

16-47
After studying this chapter, you should be able to:
1. Define direct marketing and discuss its benefits to
customers and companies
2. Identify and discuss the major forms of direct
marketing
3. Explain how companies have responded to the
Internet and other powerful new technologies
with online marketing strategies
4. Discuss how companies go about conducting
online marketing to profitably deliver more value
to customers
5. Overview the public policy and ethical issues
presented by direct marketing

17-2
1. The New Direct-Marketing Model
2. Growth and Benefits of Direct Marketing
3. Customer Databases and Direct Marketing
4. Forms of Direct Marketing
5. Online Marketing
6. Integrated Direct Marketing
7. Public Policy Issues in Direct Marketing

17-3
Direct marketing consists of direct
connections with carefully targeted
individual consumers to both obtain an
immediate response and cultivate lasting
customer relationships

• No intermediaries
• An element of the promotion mix
• Fastest-growing form of marketing

17-4
 Benefits to Buyers

• Convenience
• Ready access to many products
• Access to comparative information about
companies, products, and competitors
• Interactive and immediate

17-5
 Benefits to Sellers

• Tool to build customer relationships

• Low-cost, efficient, fast alternative to
reach markets
• Flexible
• Access to buyers not reachable through
other channels

17-6
 Customer Database

Customer database is an organized collection of

comprehensive data about individual customers or
prospects, including geographic, demographic,
psychographic, and behavioral data

Uses:
• Locate good and potential customers
• Generate sales leads
• Learn about customers
• Develop strong long-term relationships

17-7
• Personal selling direct marketing
• Direct-mail direct marketing
• Catalog direct marketing
• Telephone marketing
• Direct-response television marketing
• Kiosk marketing
• Digital direct marketing
• Online marketing

17-9
Direct-mail marketing involves an offer,
announcement, reminder, or other item
to a person at a particular address

• Personalized
• Easy-to-measure results
• Costs more than mass media
• Provides better results than mass media

17-10
 Catalog direct marketing involves
printed and Web-based catalogs

Benefits of Web-based Challenges of Web-based

catalogs catalogs
• Require marketing
• Lower cost than printed
• Difficulties in attracting new
catalogs
customers
• Unlimited amount of
merchandise
• Real-time merchandising
• Interactive content
• Promotional features

17-11
Telephone direct marketing involves using the
telephone to sell directly to consumers and
business customers

• Outbound telephone marketing sells directly to

consumers and businesses
• Inbound telephone marketing uses toll-free
numbers to receive orders from television and
print ads, direct mail, and catalogs

17-12
Benefits of telephone Challenges of Web-
direct marketing based catalogs
• Unsolicited outbound
• Purchasing
convenience telephone marketing
• Do-Not-Call Registry
• Increased product
service and
information

17-13
Direct-response television (DRTV) marketing
involves 60- to 120-second advertisements that
describe products or give customers a toll-free
number or Web site to purchase and 30-minute
infomercials such as home shopping channels
• Less expensive than other forms of promotion
• Easier to track results

17-14
Kiosk marketing involves placing
information and ordering machines in
stores, airports, trade shows, and other
locations

17-15
Digital direct marketing technologies
• Mobile phone marketing
• Podcasts
• Vodcasts
• Interactive TV

17-16
Mobile phone marketing includes:
• Ring-tone giveaways
• Mobile games
• Ad-supported content
• Contests and sweepstakes

17-17
Podcasts and Vodcasts involve the
downloading of audio and video files via
the Internet to a handheld device such as
a PDA or iPod and listening to them at the
consumer’s convenience

17-18
Interactive TV (ITV) lets viewers interact
with television programming and
advertising using their remote controls
and provides marketers with an
interactive and involving means to reach
targeted audiences

17-19
 Marketing and the Internet

Internet is a vast public web of computer

networks that connects users of all types
around the world to each other and to a
large information repository

17-20
 Online Marketing Domains

• Business to consumer (B2C)

• involves selling goods and services online to final
consumers
• Business to business (B2B)
• involves selling goods and services, providing
information online to businesses, and building
customer relationships
• Consumer to consumer (C2C)
• occurs on the Web between interested parties over
a wide range of products and subjects, blogs
• Consumer to business (C2B)
• involves consumers communicating with
companies to send suggestions and questions via
company Web sites

17-21
 Types of Online Marketers

• Click-only marketers
• Operate only online without any brick and mortar
presence
• E-tailers (Amazon), search engines and portals,
shopping or price comparison sites, Internet service
providers (ISP)
• Click-and-mortar marketers
• Companies are brick-and-mortar companies with an
online presence
• Advantages of click and mortar companies include
known and trusted brand names, strong financial resources,
large customer bases, industry knowledge, reputation etc

17-25
 Setting Up an Online Presence

Creating a Web site requires

designing an attractive site and
developing ways to get
consumers to visit the site,
remain on the site, and return to
the site

17-31
 Setting Up an Online Presence

Types of sites
• Corporate Web site
• Marketing Web site

17-32
 Setting up an Online Presence

Corporate Web site is designed to build

customer goodwill and to supplement
other channels, rather than to sell the
company’s products directly to:
• Provide information
• Create excitement
• Build relationships

17-33
 Setting Up an Online Presence

Marketing Web site is designed to engage

consumers in interaction that will move
them closer to a direct purchase or other
marketing outcome

17-34
 Designing Effective Web Sites

To attract visitors, companies must:

• Promote in offline promotion and online
links
• Create value and excitement
• Constantly update the site
• Make the site useful

17-35
 Designing Effective Web Sites
The seven Cs of effective Web site design
1. Context - is the site’s layout
2. Content - is the site’s pictures, sound, and video
3. Community - is the site’s means to enable user-to-
user communication
4. Customization - is the site’s ability to tailor itself to
different users or to allow users to personalize the
site
5. Communication - is the way the site enables user-to-
user, user-to-site, or two-way communication
6. Connection - is the degree that the site is lined to
other sites
7. Commerce - is the site’s capabilities to enable
commercial transactions

17-36
 Designing Effective Web Sites

The eighth C

To keep customers coming back, the site

needs to constantly change

17-39
 Placing Ads and Promotions Online

Forms of online advertising

• Display ads
• Search-related ads
• Online classifieds

17-40
 Placing Ads and Promotions Online

Display ads
• Banners are banner-shaped ads found on a Web
site
• Interstitials are ads that appear between screen
changes
• Pop-ups are ads that suddenly appear in a new
window in front of the window being viewed
• Rich media ads incorporate animation, video,
sound, and interactivity

17-41
 Placing Ads and Promotions Online

Search-related ads are ads in which text-

based ads and links appear alongside
search engine results on sites such as
Google and Yahoo! and are effective in
linking consumers to other forms of
online promotion

17-42
 Placing Ads and Promotions Online
Other forms of online promotion include
Content sponsorships provide companies with
name exposure through the sponsorship of special
content such as news or financial information
Alliances and affiliate programs are relationships
where online companies promote each other
Viral marketing is the Internet version of word-of-
mouth marketing and involves the creation of a
Web site, an e-mail message, or another
marketing event that customers pass along to
friends

17-44
 The Future of Online Advertising

Online advertising provides a useful purpose

as a supplement to other marketing
efforts and is playing an increasingly
important role in the marketing mix

17-45
 Creating or Participating in Web Communities

Web communities allow members to

congregate online and exchange views
on issues of common interest
• iVillage.com
• MyFamily.com

17-46
 Using E-mail

Marketers are developing enriched

messages that include animation,
interactivity, and personal messages with
streaming audio and video to compete
with the cluttered e-mail environment

17-47
Integrated direct marketing involves the
use of carefully coordinated multiple-
media, multiple-stage campaigns

17-48
• Customer irritation, unfairness,
deception, and fraud
• Privacy
• Security

17-49
 Irritation, Unfairness, Deception, and Fraud

Irritation includes annoying and offending

customers
Unfairness includes taking unfair advantage of
impulsive or less-sophisticated buyers
Deception includes “heat merchants” who design
mailers and write copy designed to mislead
consumers
Internet fraud includes identity theft and financial
scams

17-50