CHAPTER 17 Personal Selling and Sales Management This chapter begins with the learning outcome summaries, followed by a set of lesson plans for you to use to deliver the content in Chapter 17. • Lecture (for large sections) on page 3 • Company Clips (video) on page 4 • Group Work (for smaller sections) on pages 5 Review and Assignments begin on page 6 • Review questions • Application questions • Application exercise • Ethics exercise • Video assignment • Case assignment Great Ideas for Teaching Marketing from faculty around the country begin on page 13 LEARNING OUTCOMES 17-1 Understand the sales environment Salespeople can be consumer-focused (as in the case of retail) or business-focused. The sales environment changes constantly as new competitors enter the market and old competitors leave. The ways that customers interact with salespeople and learn about products and suppliers are changing due to the rapid increase in new sales technologies. In order for companies to successfully sell products or services using a sales force, they must be very effective at personal selling, sales management, customer relationship management, and technology—all of which play critical roles in building strong long-term relationships with customers. 17-2 Describe personal selling Personal selling is direct communication between a sales representative and one or more prospective buyers in an attempt to influence each other in a purchase situation. Broadly speaking, all businesspeople use personal selling to promote themselves and their ideas. Personal selling offers several advantages over other forms of promotion. Generally speaking, personal selling becomes more important as the number of potential customers decreases, as the complexity of the product increases, and as the value of the product grows. Technology plays an increasingly important role in personal selling. If salespeople do not stay well informed about the products they’re selling, consumers may enter the store knowing even more than they do. 17-3 Discuss the key differences between relationship selling and traditional selling Relationship selling is the practice of building, maintaining, and enhancing interactions with customers to develop long-term satisfaction through mutually beneficial partnerships. Traditional selling, on the other hand, is transaction focused. That is, the salesperson is most concerned with making a one-time sale and moving on to the next prospect. Salespeople practicing relationship selling spend more time understanding a prospect’s needs and developing solutions to meet those needs. 17-4 List and explain the steps in the selling process The selling process is composed of seven basic steps: (1) generating leads, (2) qualifying leads, (3) approaching the customer and probing needs, (4) developing and proposing solutions, (5) handling objections, (6) closing the sale, and (7) following up. The actual sales process depends on the features of the product or service, characteristics of customer segments, and internal processes in place within the firm (such as how leads are gathered). Some sales take only a few minutes to complete, but others may take much longer. Like other forms of promotion, the steps of selling follow the AIDA concept. 17-5 Understand the functions of sales management The sales manager’s basic job is to maximize sales at a reasonable cost while also maximizing profits. The sales manager’s responsibilities include (1) defining sales goals and the sales process, (2) determining the sales force structure, (3) recruiting and training the sales force, (4) compensating and motivating the sales force, and (5) evaluating the sales force. 17-6 Describe the use of customer relationship management in the selling process Companies that have CRM systems follow a customer-centric focus or model. The interaction between the customer and the organization is the foundation on which a CRM system is built. Only through effective interactions can organizations learn about the expectations of their customers, generate and manage knowledge about them, negotiate mutually satisfying commitments, and build long-term relationships. If a company has identified its best customers, then it should make every effort to maintain and increase their loyalty. Terms campaign management lead qualification relationship selling (consultative selling) cold calling needs assessment customer-centric negotiation sales presentation follow-up networking sales process (sales cycle) interaction point-of-sale interactions sales proposal knowledge management preapproach touch points lead generation (prospecting) referral quota LESSON PLAN FOR LECTURE Brief Outline and Suggested PowerPoint Slides: Learning Outcomes and Topics PowerPoint Slides LO1 Understand the sales environment 17-1 The Sales Environment 1: Personal Selling and Sales Management 2: Learning Outcomes 3: Learning Outcomes 4: The Sales Environment 5: The Sales Environment LO2 Describe Personal Selling 17-2 Personal Selling 6: Personal Selling 7: Advantages of Personal Selling LO3 Discuss the key differences between relationship selling and traditional selling 17-3 Relationship selling 8: Relationship Selling 9: Relationship Selling 10: Exhibit 17.1: Comparison of Personal Selling and Advertising/Sales Promotion 11: Exhibit 17.2: Key Differences between Traditional Selling and Relationship Selling LO4 List and explain the steps in the selling process 17-4 Steps in the Selling Process 12: Steps in the Selling Process 13: Steps in the Selling Process 14: Generating Leads 15: Cold Calling 16: Qualifying Leads 17: Approaching the Customer and Probing Needs 18: The Consultative Salesperson 19: Developing and Proposing Solutions 20: Handling Objections 21: Closing the Sale 22: Following Up 23: The Impact of Technology LO5 Understand the functions of sales management 17-5 Sales Management 24: Sales Management 25: Sales Management 26: Sales Goals and the Sales Process 27: Sales Force Structure 28: The Sales Force 29: Compensating the Sales Force 30: Evaluating the Sales Force LO6 Describe the use of customer relationship management in the selling process 17-6 Customer Relationship Management and the Sales Process 31: Customer Relationship Management and Personal Selling 32: Customer Relationship Management 33: Identify Customer Relationships 34: Interactions of the Current Customer Base 35: Capturing Customer Data 36: Leveraging Customer Information 37: Chapter 17 Video Suggested Homework: • The end of this chapter contains assignments for the New Balance Hubway video and a case assignment on protecting customers • This chapter’s online study tools include flashcards, visual summaries, practice quizzes, and other resources that can be assigned or used as the basis for longer investigations into marketing. LESSON PLAN FOR VIDEO Company Clips Segment Summary: New Balance Hubway New Balance Hubway is a bike-sharing system located in Boston Massachusetts designed to augment existing transportation systems in the greater Boston area. In this clip, Hubway discusses how they generate buzz and get funding to build their bike share network. These teaching notes combine activities that you can assign students to prepare before class, that you can do in class before watching the video, that you can do in class while watching the video, and that you can assign students to complete as assignments after watching the video in class. During the viewing portion of the teaching notes, stop the video periodically where appropriate to ask students the questions or perform the activities listed on the grid. You may even want to give the students the questions before starting the tape and have them think about the answer while viewing the segment. That way, students will be engaged in active viewing rather than passive viewing. PRE-CLASS PREP FOR YOU: PRE-CLASS PREP FOR YOUR STUDENTS: • Preview the Company Clips video segment for Chapter 17. This exercise reviews concepts for LO1–LO6. • Review your lesson plan. • Make sure you have all of the equipment needed to show the video to the class, including the DVD and a way to project the video. • You can also stream the video HERE • Have students review and familiarize themselves with the following terms and concepts: personal selling and relationship selling. • Have students bring written definitions of the above terms to class. • Have students call a retailer of choice and ask the manager what reps the store works with to buy its inventory. If a store does not use reps, the students should try calling other stores until they find a one that does. They should also query the manager about the benefits of using reps. VIDEO REVIEW EXERCISE ACTIVITY Warm Up Briefly discuss students’ findings from the final activity in the Pre-Class Prep. Review the types of products sold at the store, the number of reps the store works with, and the benefits derived from working with reps. In-class Preview • Review Exhibit 17.1, Comparison of Personal Selling and Advertising/Sales Promotion. • Discuss the steps in the selling process. Focus on generating leads, qualifying leads, approaching the customer and probing needs, closing the sale, and following up. • Discuss the issues involved in sales force management. Pay special attention to sales force structure, recruiting and training the sales force, compensating and motivating the sales force, evaluating the sales force, and the impact of technology on personal selling. • Have copies of the Company Clips questions (below) available for students to take notes on while viewing the video segment. Viewing (solutions below) 1. How do you know that Hubway strongly encourages relationship selling? 2. Discuss the importance of social media to Hubway. What impact does it have on customer relationship management? Follow-up • Discuss the role of relationship selling at Scholfield Honda. • Ask students, “How is the recruiting process similar to the selling process?” • Divide students into groups of three to five and have them devise a compensation and motivation program for Scholfield Honda. Give them 10 to 15 minutes to develop a proposal. Have as many groups as time allows share their outlines with the class. Solutions for Viewing Activities 1. How do you know that Hubway strongly encourages relationship selling? Answer: Answers will vary, but the discussion about focusing on one-to-one interaction either face to face or through social media to develop a close relationship with that one person, who then becomes a brand ambassador, signals that Hubway relies on relationship marketing to spread the word. 2. Discuss the importance of social media to Hubway. What impact does it have on customer relationship management? Answer: Hubway relies on social media for the bulk of its ability to spread the word (sharing user posts about Hubway), keep customers discussing the service (engage customers through social media posts and messages to them), and to provide excellent customer service (Spot cycle and letting people know about station maintenance etc.). This also provides a great place to identify customer interactions, understand the customer base, and to send out targeted marketing messages. LESSON PLAN FOR GROUP WORK In most cases, group activities should be completed after some chapter content has been covered, probably in the second or third session of the chapter coverage. (See “Lesson Plan for Lecture” above.) Application question 1 translates well to group work. Divide the class into small groups of four or five people. Each group should read the question and then use their textbooks, or any work that was completed previously, to perform the exercise. Then each group should discuss or present their work to the class. Class Activity – Sales Force Structure and Compensation The purpose of this exercise is to determine the best structure for a sales force in a variety of industries. Divide the class into teams. Each team will represent a new company that is creating a sales force to sell the product or service to a national market. The teams can represent one of the following product categories (no two teams should have the same category): 1) a video game targeted to kids ages 8 to 12; 2) a book about budget travel around the world, targeted to college students; 3) a Smartphone; 4) an ergonomic backpack targeted to high school and college students; and 5) sneakers with rollers targeted to the teen market. Each team should determine the following: • A realistic distribution channel for the product • How to structure the sales force across the entire United States (each team should assume that the product will be sold nationally) • How the sales force should be compensated When all the teams complete the above, they should present their ideas to the class. REVIEW AND ASSIGNMENTS FOR CHAPTER 17 REVIEW QUESTIONS 1. Discuss the role of personal selling in promoting products. What advantages does personal selling offer over other forms of promotion? Answer: Personal selling plays a crucial role in promoting products by allowing direct interaction between the salesperson and the customer. This face-to-face engagement enables salespeople to tailor their approach, address specific customer needs, and build trust and relationships. Advantages of Personal Selling: 1. Personalization: Salespeople can customize their pitch based on customer feedback, leading to higher engagement. 2. Immediate Feedback: Salespersons can quickly gauge customer reactions and adjust their strategies accordingly. 3. Relationship Building: Personal selling fosters long-term relationships, which can enhance customer loyalty and repeat business. 4. Complex Products: For intricate or high-value items, personal selling allows for detailed explanations and demonstrations that other forms of promotion may not effectively convey. 5. Closing Sales: Skilled salespeople can effectively overcome objections and close sales, driving immediate results. Overall, personal selling is particularly effective for products requiring explanation or demonstration, offering a more interactive and responsive promotional strategy than other methods. 2. What are the major advantages of personal selling to the company selling a product? What are the advantages to the person or company buying the product? Answer: Personal selling is considerably more effective than other forms of promotion in obtaining a sale and gaining a satisfied customer. An advantage to a buyer, especially of a new or complicated product or system, is that a salesperson is available to determine the customer’s needs, explain the product’s basic advantages, and propose the exact features and accessories that will meet the customer’s needs. 3. What are the key differences between relationship selling and traditional methods of selling? Which types of products or services do you think would be conducive to relationship selling? Answer: The answer for the first part of the question should focus on the key differences highlighted in the text Exhibit 17.2. They include differences in the “product” being provided, focus, amount of sales planning, use of contact time, extent of needs assessment, approach, content of proposals and presentations, and extent of follow-up. Relationship selling is most suitable for products that are complex, customized, need additional services, or will be bought over a period of time. Student responses as to the particular products that meet these criteria will vary. 4. Based on the key differences between traditional and relationship selling, which type of sales approach would you use as a salesperson? Do the different approaches require different personal strengths or attributes? Answer: As a salesperson, I would prefer the relationship selling approach. This method emphasizes building long-term connections and understanding customer needs, which aligns well with fostering loyalty and repeat business. Key Differences: 1. Focus: • Traditional Selling: Emphasizes quick sales and transactions. • Relationship Selling: Prioritizes ongoing relationships and customer satisfaction. 2. Approach: • Traditional Selling: Often more aggressive and product-focused. • Relationship Selling: More consultative, focusing on customer needs and solutions. Required Attributes: • Traditional Selling: Requires assertiveness, persistence, and strong closing skills. • Relationship Selling: Demands empathy, active listening, patience, and strong communication skills. In summary, relationship selling suits those who excel in interpersonal skills and value long-term customer engagement. 5. What does sales follow-up entail? Why is it an essential step in the selling process, particularly from the perspective of relationship selling? How does it relate to cognitive dissonance? Answer: Although students’ answers will vary, they should address some of these points: A salesperson who properly follows up a sale ensures that delivery schedules are met, products perform as promised, and product-use training is provided. Follow-up is a vital aspect of personal selling because it facilitates customer loyalty and repeat sales, which are crucial elements of a successful business. Increasingly competitive market conditions have led to a sharp decline in customer loyalty, making quality service more important than ever before. Customers who do not receive follow-up service are likely to experience cognitive dissonance about their purchases and go elsewhere for business in the future. 6. Consider each step in the selling process. Which steps could be conducted through technology (Internet, webinars, etc.)? Which are most important to handle “face-to-face”? Answer: Steps Conducted Through Technology: 1. Prospecting: Utilizing social media, CRM tools, and online databases to identify leads. 2. Pre-Approach: Researching potential clients and gathering information via online platforms. 3. Presentation: Conducting webinars, virtual demos, and online presentations. 4. Follow-Up: Sending emails, messages, and utilizing automated follow-up tools. Steps Best Handled Face-to-Face: 1. Approach: Building rapport and establishing trust is more effective in person. 2. Needs Assessment: Engaging in deep, personalized discussions to understand customer needs. 3. Closing: Negotiating terms and overcoming objections often benefits from direct interaction. In summary, technology can efficiently support many steps, but critical relationship-building and nuanced discussions are best conducted face-to-face. 7. How does each of the sales management functions contribute to a successful, high-performing sales force? Answer: Students should consider the contributions of goal setting, effective sales process and structure, recruiting and training to build a successful sales force, as well as motivation through compensation plans and performance evaluations. APPLICATION QUESTIONS 1. You are a new salesperson for a well-known medical software company, and one of your clients is a large group of physicians. You have just arranged an initial meeting with the office manager. Develop a list of questions you will ask at this meeting to uncover the group’s specific needs. Answer: Although students’ answers will vary, they should address some of these points: The need-satisfaction approach would be the most effective method of selling medical software and requires that the salesperson uncover the real needs of the business. Because medical software is a complex and relatively large investment, a salesperson who tailors her or his sales presentation based on an assessment of a firm’s particular needs is far more likely to make a sale. The salesperson will want to ask about billing, record keeping, goals for assisting the doctors, and so on. It would help to have someone in the software organization with experience in a medical office accompany the salesperson to field specific questions. 2. How many ways can ZapData (http://www.zapdata.com) benefit salespeople? Which of its services would be most useful to marketing managers? Other businesspeople? Answer: ZapData offers several benefits to salespeople, including: 1. Lead Generation: Access to a vast database of potential customers for targeted outreach. 2. Data Accuracy: Up-to-date information helps in identifying quality leads and reducing wasted efforts. 3. Market Insights: Understanding industry trends and customer demographics enhances sales strategies. 4. Segmentation: Allows sales teams to tailor their approach to different customer segments. Most Useful Services: • For Marketing Managers: The market research and data analytics tools are invaluable for crafting targeted campaigns and understanding market dynamics. • For Other Businesspeople: Business intelligence services, such as competitive analysis and industry reports, can inform strategic decisions across various functions. Overall, ZapData’s services can significantly enhance efficiency and effectiveness for salespeople, marketing managers, and other business professionals. 3. Consider each step in the selling process. Which steps could be conducted through technology (Internet, webinars, etc.)? Which are most important to handle “face-to-face”? Answer: Steps Conducted Through Technology: 1. Prospecting: Utilizing online databases, social media, and lead generation tools. 2. Pre-Approach: Researching potential clients via websites and online platforms. 3. Presentation: Conducting webinars, virtual demos, and online meetings. 4. Follow-Up: Using email, CRM systems, and automated tools for follow-up communications. Steps Best Handled Face-to-Face: 1. Approach: Establishing rapport and trust is more effective in person. 2. Needs Assessment: Engaging in detailed, personalized discussions to fully understand customer needs. 3. Closing: Negotiating terms and addressing objections benefit from direct interaction and relationship building. In summary, technology facilitates many selling steps, while key relationship-building activities are best conducted face-to-face. 4. What kinds of sales management opportunities are available at Amway and Quixtar? Use the companies’ Web sites (www.amway.com; www.quixtar.com) to research one of these companies and determine its sales process, sales force structure, and how it recruits and trains its salespeople. Answer: Sales Management Opportunities at Amway and Quixtar Both Amway and Quixtar offer various sales management roles, including positions such as: 1. Sales Manager: Overseeing sales teams and strategies. 2. Regional Sales Director: Managing sales operations in specific geographic areas. 3. Training Coordinator: Developing and implementing training programs for salespeople. Amway's Sales Process 1. Prospecting: Sales representatives identify potential customers through personal networks and events. 2. Presentation: Demonstrating products to potential customers, often in home settings or online. 3. Follow-Up: Maintaining relationships with customers for repeat sales and referrals. Sales Force Structure • Independent Business Owners (IBOs): Amway operates through a network of IBOs who sell products directly to consumers. • Hierarchical Structure: IBOs can build teams, creating a multi-level structure that incentivizes recruitment. Recruitment and Training • Recruitment: IBOs recruit new members through personal connections and social networks. • Training: Amway offers extensive training programs, including online resources, workshops, and mentorship from experienced IBOs. This approach helps IBOs develop sales skills and product knowledge, fostering a supportive community. APPLICATION EXERCISE Have you ever waited forever to get a fast-food hamburger? Have you ever been left to languish in a dressing room by a salesperson that left for a coffee break? If so, you already know that sales and customer service are integral parts of marketing. While you are working on this chapter, keep a journal of your personal sales and customer service experiences with local merchants. Don’t ignore the details. Even such things as how crowded a store or restaurant is when you visit may affect your perceptions of the service you received. Activities 1. Keep your journal for a week, recording all sales and service transactions, if possible, on the day they occur. 2. At the end of the week, examine your journal, and pick the most noteworthy entry. Provide the basic information about the transaction: company where it occurred, type of transaction (purchase, return, complaint, etc.), type of good or service involved, and so forth. 3. Once you have the outlined the situation, evaluate the experience. Use the information about selling in this chapter as support for your evaluation. For example, did the salesperson seem to treat the situation as an individual, discrete transaction, or did he or she seem interested in building a relationship? 4. Finally, make recommendations as to how the company can improve its sales or service. Suggestions should be logical and achievable (meaning you have to consider the cost of implementing your suggestion). Purpose: To have students think critically about sales and sales experiences from the customer and sales rep point of view. Setting It Up: This works best as an individual assignment. The journal format allows for collection of data as well as reflection on their meaning. This exercise was inspired by the following Great Idea in Teaching Marketing: John Ronchetto University of San Diego SALES AND CUSTOMER SERVICE EXPERIENTIAL JOURNAL AND PAPER During the first 10 weeks of a personal selling course, students keep a journal or diary of their separate sales and customer service experiences with local merchants. For each interaction, they register factual information (where, when, nature of interaction), key selling or conflict resolution techniques utilized by the sales or service person, and any other relevant observations. For example, whether or not the establishment was crowded may very well affect their experiences. Students are advised to make entries on the same day that they personally participated or observed the sales or service encounter. Their journals should be current, detailed, and organized in a consistent manner. After the first three weeks of the term, students are liable to be called upon to initiate class discussion based upon information contained in their journals. Also, during the fifth and eighth weeks, student journals are collected and their comments are reviewed for clarity of writing style and relevancy to specific sales or service concepts covered in the course. In the second phase of this assignment, students write about one of their most noteworthy experiences in terms of learning value. They discuss the organization, the sales or service situation (e.g., buying a new product), the type of good or service (e.g., personal computer), and other items of significance (e.g., time of day, location of business, layout of store). In addition, based on their reading of the personal selling text, acting as participants and observers of in-class student sales role-plays, and class discussions on sales and service concepts and practices, students evaluate this experience. In their written analysis and evaluation of this specific sales or service encounter, students recommend the most important actions the sales or service person should take to change the result (e.g., modify his or her closing technique to obtain the order). Some suggestions might be directed toward the sales or store managers. Students are cautioned to be selective and focus on the most important steps because their papers are limited to five typewritten pages. Grading criteria include the following: 1) How suitably and extensively are sales concepts from the course readings and lectures included? 2) How reliable is the diagnosis of probable causes of success or failure of the encounter? 3) how logical and achievable (i.e., cost effective) are the recommendations? 4) How clearly is the paper organized and written? ETHICS EXERCISE Sally Burke works for Hi-Tech Electronics. Her responsibilities include selecting items to advertise in her company’s Sunday newspaper FSIs. One hot item is a 74-inch flat-panel 3D plasma TV. The list price is $2,999, but her manager tells her to advertise it at $1,999, since customers can apply for a $1,000 mail-in rebate. The advertised price has attracted many people to buy the TV; however, Sally has heard several complaints from customers who found the rebate process unusually complex and were denied a rebate because the manufacturer claimed they hadn’t provided the required information. She would prefer to advertise the “real” list price, knowing that customers are not guaranteed to receive a rebate. 1. Is it unethical to advertise products at their post-rebate price in order to increase sales? Why or why not? What is another sales promotion method Hi-Tech Electronics could use to persuade customers to buy their plasma TV at the store? Answer: Students’ answers will vary, but they should include the following points: Most products containing a rebate will show the original price, the price after the rebate, and the savings. As long as the product is advertised stating the price is with a rebate, it is not unethical. Other sales promotion methods that Hi-Tech Electronics could use would be to offer a premium with the purchase of the plasma TV, implement a loyalty marketing program, or have a sweepstakes that customers are entered into when they purchase a plasma TV. 2. Rebate programs are commonly used by electronic manufacturers because the rebates arouse consumers’ interest in buying products; yet only half of purchasers ultimately claim their rebates. Is a rebate program itself unethical if the manufacturer knows consumers are unlikely to receive their money? Answer: Students may have differing opinions. It would be unethical for manufacturers’ to not pay the customers who do fill out the rebate claim; however, those customers who do not fill out the form and mail in the rebate simply do not receive their money; it is not an unethical practice by the manufacturer. 3. Visit a local electronics store or Web site and find a product being sold with a mail-in rebate offer. Are the rebate instructions clear? Would you take the time to complete the process? Answer: I visited a local electronics store’s website and found a laptop with a mail-in rebate offer. Clarity of Instructions The rebate instructions were generally clear, outlining steps such as: 1. Purchase the product within the specified dates. 2. Complete the rebate form online or print it. 3. Include the required receipts and UPC code. 4. Mail it to the specified address by the deadline. Would I Complete the Process? Yes, I would consider completing the process, especially if the rebate is substantial. However, I would need to ensure that the submission timeline is manageable and that I have all necessary documents readily available to avoid any issues. VIDEO ASSIGNMENT: Scholfield Honda New Balance Hubway is a bike-sharing system located in Boston Massachusetts designed to augment existing transportation systems in the greater Boston area. In this clip, Hubway discusses how they generate buzz and get funding to build their bike share network. 1. By crunching the numbers and awarding highest-use members “Gold-club” t-shirts, Hubway was performing which step in the CRM system? A. Identifying Customer Relationships B. Understanding the interactions of the customer base C. Capturing customer data D. Leveraging customer information Answer: D Awarding the highest-use members is part of maintaining loyal customers, which falls under leveraging customer information. 2. For Hubway, PR launch events function as a point-of-sale interaction. A. True B. False Answer: B These would be touch points for new customers to make sure they understand the system. 3. Based on this video clip, New Balance Hubway uses advertising and promotion more than personal selling. A. True. B. False. Answer: A This video is a strong example of how businesses choose to use CRM systems and ads/PR/Promotion vs. personal selling based on the characteristics of the product. 4. Twitter allows Hubway to talk and respond directly to customers, and all social media allows Hubway to give one person a direct message, creating a strong relationship and encouraging word of mouth. It also allows for conversations to happen in a one-on-one way. Social media is the modern version of personal selling. A. True. B. False. Answer: A While lacking physical face-to-face communication, social media can be a type of personal selling, though it is not exclusively used in that way. 5. Customers coming out to events, such as the one at the Boston Public Library, and buying annual memberships makes those events A. Learning opportunities B. Campaign management C. Touch points D. Relationship selling Answer: C Any event or place where customers interact with the business functions as an opportunity to collect data, making that a touch point. CASE ASSIGNMENT: Protecting Customers Many companies are looking for better ways to protect their customers’ information. This is particularly true of banks and online marketplaces like eBay. One way eBay is working to protect its customers is by using their information to help identify fraud. Using data mining, eBay is able to process large amounts of transaction information and product descriptions to detect sellers who are attempting fraud. According to eBay, fraud has decreased significantly since the company began implementing security measures based on data mining. Similarly, Ford uses data collected from four million cars to improve in-car features, such as voice recognition and vehicle safety. In-car sensors relay information to Ford about how customers drive and how they use various features of the car. Ford then uses this data to fine-tune features in the following year’s models. Customers can also use Ford’s remote management system, which provides the company with notifications about any malfunctions or maintenance needs such as brake pads that need to be replaced. Because eBay and Ford go above and beyond to make customer protection a main priority, these companies forge stronger, more personal bonds with their customers. SOURCE: Michael Hickins, “For Some, Security is a Starting Point for Big Data,” Wall Street Journal, May 3, 2012, http://blogs.wsj.com/cio/2012/05/03/for-some-security-is-a-starting-point-for-big-data/ (Accessed March 26, 2013); Rachel King, “Ford Gets Smarter about Marketing and Design,” Wall Street Journal, June 20, 2012, http://blogs.wsj.com/cio/2012/06/20/ford-gets-smarter-about-marketing-and-design/ (Accessed March 26, 2013). TRUE/FALSE 1. Protecting customers’ information is a reasonable component of a relationship selling strategy. Answer: True 2. Determining the level of data collection and protection that a prospective customer desires before offering those services to the customer is a crucial part of lead qualification. Answer: False Determining how to maximize the fit between what the company offers and what the prospective customer wants is a crucial part of the needs assessment. 3. A salesperson at a popular Ford dealership may be assigned a quota, a statement of the salesperson’s sales goals, usually based on sales volume. Answer: True MULTIPLE CHOICE 1. Why does Ford use personal selling to sell automobiles? A. Personal selling allows salespeople to demonstrate the company’s high-tech safety features. B. Salespeople can vary their message according to the motivations and interests of individual customers. C. Personal selling allows Ford to qualify customers through direct conversations, credit checks, and other methods. D. Personal selling is the most effective way to completing the sale of an automobile. E. All of these. Answer: E All of these are advantages of personal selling as it relates to the sale of automobiles. 2. Which of the following is not a trait that Ford likely looks for in its sales representatives? A. They should have strong, healthy self-esteems. B. They should be capable of understanding complex ideas. C. They should have a sense of urgency and competitiveness. D. They should avoid risk and focus on sure things. E. They should be empathetic toward customers. Answer: D Great salespeople are willing to put themselves in less-than-assured situations, and in doing so, often are able to close unlikely sales. 3. Based on the case, which of the following benefits of Internet-assisted selling is most useful to eBay in its mission to protect customers? A. The Internet allows salespeople to be more accessible to both clients and the company. B. The Internet frees salespeople from tedious administrative tasks like shipping catalogs, placing routine orders, and tracking orders. C. The Internet facilitates cost-effective processing of orders and service requests. D. The Internet has become a powerful tool for customers to access accurate and up-to-date information. E. The Internet provides salespeople with vast resources of information on clients, competitors, and the industry. Answer: E Using data mining, eBay is able to process large amounts of transaction information and product descriptions to detect sellers who are attempting fraud. GREAT IDEAS FOR TEACHING CHAPTER 17 Rich Brown, Freed-Hardeman University GREEN EGGS AND HAM MAKE FOR A GREAT FINAL EXAM This is the final exam I use in my Personal Selling classes. On seeing the exam, students often initially react as if I have gone crazy. They end up enjoying the test, are able to show what they have learned in class, and many of them tell me they learn more about selling and themselves while taking the test. I strongly encourage them to be creative in their answers and presentation of them. Many put their answers in book form or include a small Dr. Seuss toy with them. I have been served actual green eggs and ham on two occasions. Before passing out the exam, I always read the book to the class. I introduce it as “one of the greatest sales help books ever written.” In my class, we use Robert Cialdini’s Influence: Science and Practice in addition to a traditional selling text. The fourth part of the exam should be dropped if you do not cover this material. I highly recommend Cialdini’s book to everyone who is interested in selling. THE TEST I have put a copy of Dr. Seuss’s Green Eggs and Ham on reserve in the library. You may want to buy your own copy; you should never let yourself get so busy you don’t have time to read a Dr. Seuss book to a little kid. You are not to work together. In the book Green Eggs and Ham Sam successfully convinces his prospect to become a consumer of the aforementioned poultry and pork products. Demonstrate your mastery of the material we have covered this semester by doing the following: First, identify and discuss factors that contributed to Sam’s success as a “salesperson.” Think about each step in the selling process. Persistence is not the only “success factor” you should see when looking at Sam. Second, there are some things Sam did not do at all; identify and discuss the ones you think most important. Third, using Sam as your salesperson, provide examples and discussion of things you can imagine Sam doing and saying to improve his sales presentation. Fourth, be sure to include discussion, or examples, of how Sam did or could have used each of Cialdini’s six Principles of Ethical Influence. Stretch your mind, be creative. You will seldom achieve greatness by thinking and being like everyone else! GRADING HELP Things Sam Did Well Things Sam Could Have Done Better Stayed optimistic: smile, body language No evidence of prospecting/qualifying Showmanship No trial closes or dealing with objections Tremendous belief in product No real presentation to develop demand Persistence No attempt at negotiation Linda Warren and Katie Wootten, Truman State University MONOPOLY SALES SIMULATION The purpose of this game is to introduce the friendly, but competitive spirit of sales through an in-class simulation adapted to the Monopoly board game. The game incorporates many marketing and sales functions that the sales team can use in a selling scenario—from building a sales force to closing a sale. Students get excited, competitive, and creative about this game! Pre-game Preparation The instructor chooses two students to act as Vice Presidents of Marketing for two separate teams. They will use interview processes discussed in class for recruiting their sales managers. The sales managers will then recruit their sales force to form the team. The numbers of sales representatives may vary based on the size of the class, but a minimum of 4 for each team are recommended. The sales team will name and position their business, make business cards, formulate their marketing and promotional strategies, and create their brand identities. Sales managers will be responsible for training their sales team (with instructor guidance) and should include topics such as sales techniques, ethics, and customer relationship management. Sales approaches, territories, negotiation, and closing methods should also be included with training. Student Roles – Defining the Game Rules and Parameters Each team will get an equal number of Monopoly properties to sell. To encourage an open and competitive marketplace, the printed property prices are concealed. The price paid for the property minus the actual value will equal the profit earned on the properties. Teams will use business cards, signage, and promotional activities in their overall strategies to approach customers and sell properties. Each team will have a total $200 in Monopoly money to use as sales incentives or rebates. The sales manager will determine the amount each sales representative will receive. The rest of the students in the class will assume the role of consumers with distinct and unique buying needs or requirements. B2B and B2C are suggested roles, plus other roles are listed in Appendix A. Larger classes may use protected territories of properties on the board. At least one student will need to assume the role of banker to receive and disperse Monopoly funds. As an interesting twist in the game, a constable position is recommended to enhance the strategic balance of the game and to introduce contingencies. The constable introduces unknown surprise market factors and demonstrates some of the risks of selling in the marketplace. The constable may assign fines to sales representatives for unethical conduct or crossing territorial lines. The constable may assess and collect property tax and place a sales rep in “jail” for a two minute penalty. All fines are paid to the banker. Fines are given to “lawbreakers” by using Monopoly Community Chest cards. Game Day Set up the Monopoly board or an overhead slide of the board with the prices concealed. The banker should disperse Monopoly funds to the role-playing customers using the formula $6100+$200(number of customers)/#of customers and distribute the $200 incentive to each sales team. Sales VPs will oversee final marketing activities like set-up and signage. The instructor will signal the beginning of the game. A green Monopoly house is placed on sold consumer properties and a red Monopoly house is placed on sold business or commercial properties. The constable begins patrol and monitors the action and hands out fines or assessments. Buyers will receive deeds for properties they purchase from the banker using a contract provided by the sales representative. Game playing time is approximately 20 to 30 minutes. The instructor will call time and each team will calculate their profits. The VPs will keep a record of sales, property values, and profits. The banker will verify the sales and profit and the winning team will be declared by the instructor. Profits are determined by computing the selling price minus the actual price of the properties and adding back any remaining incentives. Post-Game Class Discuss some of the selling tools and techniques the teams used during the simulation and how they were customized to different buyers. Also discuss methods employed to address buyer reluctance and negotiation techniques. Notes This game is adaptable to classes in Marketing Principles as well as Selling and Sales Management classes. Appendix A Consumer Role Suggestions Consumer 1 Couple with 2 children, desire upscale neighborhood Consumer 2 Single, professional, 25, prefers urban setting Consumer 3 Couple, no children, both professionals, urban or suburban housing Consumer 4 Artist, 25–30, desires housing/workplace combined, low cost Consumer 5 Single, retired, fixed income, upscale reasonably priced Consumer 6 Small business owner, desires storefront near high-traffic area Consumer 7 Doctors, desire office building close to a suburban area or school Consumer 8 Business partners, desire urban location to build nightclub Consumer 9 Dry-cleaning chain, desires location near families in upscale area Consumer 10 Single blue-collar worker, low-cost property close to work Julie M. Pharr, Tennessee Technological University CONDUCTING A SALES MANAGEMENT AUDIT Students taking a sales management course can learn a great deal about the duties and responsibilities of a sales manager by conducting a sales management audit. To conduct the audit, group students into pairs. Have each pair of students contact a sales manager whose job entails directly supervising field sales representatives. The manager may be selected by the students themselves or assigned by the instructor. The following audit information may be gathered by personal interview, telephone, or e-mail. Audit Questions General: • What product or service does your company sell? Territory Management: • Explain how the sales territories are designed. • How do you decide who gets which territory? • Are all the territories equal in sales potential? Workload? • How often do you make changes in the territory design? • When a sales rep leaves, how do you reassign the territory? • How do you determine the importance of accounts within a territory? Training: • What methods do you use to train new sales reps? • Who does the training, and how long does it last? • What ongoing training is done for existing sales reps? • What objectives do you stress in your training programs? • How do you evaluate the results of training? • Who is responsible for designing the training program(s)? Compensation: • What methods are used to compensate your sales reps? • What is the average compensation for a new sales rep? A senior rep? • What type of quotas do you use, if any? • How do you reward sales reps when they meet or exceed quota? o If a sales rep does not meet quota consistently, what measures are taken to improve the situation? Evaluation: • How do you evaluate job performance? • How often are evaluations done? • How is the information from the job evaluation used (for promotions, etc.)? Recruiting: • How do you find recruits? • How does your company inform the public about a job opening? • What qualities do you look for or believe are most important in a sales recruit? • What information on the resume or application do you look for or believe is most important? • Are education and experience weighted equally? • Is the interview the final determinant of whom you will hire? • Do you check references? If so, how many (on average)? • Do you require any type of testing in the hiring process (aptitude, personality, etc.)? Instructors not wishing to furnish teams with a full list of audit questions may have students brainstorm their own questions in each of the above areas. Questions can then be critiqued and compiled to form a master list for use by the entire class. After completion of the written audit, students should compare results by giving oral reports of their findings. The audit demonstrates the variety and complexity of sales Kathleen M. Bailey, Loyola University of New Orleans LEARNING ABOUT SALES PRESENTATIONS: SALESPERSON INTERVIEW I have each student go out and interview a salesperson and go on a few calls with the salesperson. They do this after they themselves have done sales presentations (which are videotaped) for the class. Outline for Interview with Salesperson: 1. Name, job title, company, product lines 2. How long has he or she been there? 3. How long has she or he been in sales? Describe other sales jobs. 4. Describe his or her customers. 5. Things he or she likes most about the job 6. Things he or she likes least about the job 7. What is his/her selling philosophy? 8. What type of training did he/she receive? 9. Attitude about quotas, paperwork and sales managers. 10. Income: ask how much someone makes starting out and then five years later. 11. Is it salary, commission, bonus, or some combination? 12. What perks come with the job? 13. What is the most embarrassing thing that has ever happened to him or her during a call? 14. What was the most satisfying sale he or she ever made? 15. Would he or she recommend a career in sales? Outline for Things to Observe During Sales Call Before the sales call, have salesperson tell who is being called on and purpose of the call. 1. Identify the customer type. 2. What type of selling model did he or she use? 3. How did the salesperson begin the presentation? 4. How did the salesperson uncover needs? 5. How many objections did the customer bring up? 6. Did you hear any trial closes? What were they? When did they occur? 7. Did the buyer give any closing signals? 8. How many times did the salesperson try to close? What techniques did they use? 9. Did the salesperson try to relieve post-purchase dissonance? James S. Cleveland, Sage College of Albany DISCUSSION BOARD TOPICS TO ENCOURAGE PARTICIPATION Discussion board questions provided to students to encourage them to engage in thinking and writing about the content of the Principles of Marketing course usually take the form of a provocative statement to which students are asked to respond. An example of this would be “All PR is good PR.” Discussion topics such as this one are abstract and often require that the instructor provide an initial reply to show students what is expected of them in their own replies. For students with limited work experience, this approach may be quite appropriate. For adult students with extensive experience as employees and consumers, however, the abstract nature of such topics can be frustrating. I have developed, therefore, a series of discussion board questions to use with experienced, adult students. These questions are designed to encourage them to use their experiences as employees and consumers as doorways to better understand the course material, and to make their own responses more interesting to themselves and to the other students in the class who will read and comment on them. Each question has three parts: 1. First, there is a sentence or two from the students’ textbook introducing the topic. By using the text author’s own words, students are enabled to locate relevant material in the text more easily, the text content is reinforced, and confusion resulting from use of variant terms or expressions is minimized. 2. Second, there is a reference to text pages the students should review before proceeding. Since the goal of the exercise is for students to apply the course content to their own experiences, reviewing the content first is important. 3. Third, there is a request for the students to think about or remember some specific situation in their experience to which they can apply the text material, and a question or questions for them to address in their replies. Here are additional such discussion board questions developed for Chapter 17 of MKTG10. Each is written to fit the same text cited above but could easily be rewritten and revised to fit another text. Series A 1. Until recently, personal selling focused almost entirely on making a one-time sale and then moving on to the next prospect. Modern views of personal selling emphasize the relationship that develops between a salesperson and a buyer. 2. Review the information on relationship selling on pages 290–291 of your text. 3. Then identify a recent experience when you either bought or sold something. Was relationship selling used? If so, how? If not, how could it have been used? Did or would relationship selling make the selling or buying experience more pleasant? How? Solution Manual for MKTG: Principles of Marketing Charles W. Lamb, Joe F. Hair, Carl McDaniel 9781305631823, 9781285860145, 9781337116800
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