Personal Selling and Sales Promotion - Essay Example

Running Head Personal Selling and Sales Promotion Personal Selling and Sales Promotion The goal and aim of every retail company isto crease value for customers and build customer relations. "Sales force serves as a critical link between a company and its customers" (Kotler and Armstrong 2008, p. 253). Value is created through communication and representation of customers to the company, through management of buyer-seller relations and representation of existing and new products. Involvement is a process by which employees voluntarily and actively pursue increments to value. If Interdependence and Integration are to have their desired effect on customer value, the employees of the firm must be totally convinced of the need for them and be involved in their implementation. Ingraining is a process by which people at work develop norms and beliefs (Kerin et al 2005). Certain ways of thinking and doing become taken for granted even though they have not been explicitly stated. In the main aspect of value communication, direct two-way information transfer between customer and firm, service businesses enjoy an edge, because the customer is in the system. Their needs are therefore not remote and to be inferred but right here and given expression to. The likelihood of a firm being able to match customer needs exactly is correspondingly higher, provided the firm can customize its services (Kerin et al 2005). An interactive relationship with customers often develops in many service arenas while the service is being rendered. The customer could explain his/her needs, air travel routing with stopover, variations on a dinner order, advice from a securities analyst--and often receive service in real time. Again feedback could also be instant, resulting in high communicated value, provided responsiveness, flexibility, and learning ability are incorporated into the system. These strategies make the assumption that the company intends to persist in a concentration mode, that is, limit its horizons to a single product/service or achieve a predominant portion of its sales in one industry. Few large or medium size firms confine their product horizons (Kerin et al 2005). Following Kotler and Armstrong (2008) customer relationship management has a great impact on sales and value creation. "Winning and keeping accounts requires more than making good products and sales. It requires listening to customers, understanding their needs and coordinating the company's efforts to create a customer value" (p. 468). Typically it is small businesses that start with such a focus. With success and growth generally comes a desire to reduce dependence on any one product/market. Diversified firms have more stable sales and earnings. Risk reduction unquestionably helps enhance shareholder value. For instance, in such companies as DuPont or McDonald's this emphasizes the high priority that must be attached to cohesiveness and unity in the high-value organization, not just as a means to an end but intrinsically and for its own sake (Kerin et al 2005). The strengthening of linkages within and among the value creation demands a cooperative endeavor as does the need to bridge hierarchic gaps. A main value that seems critical to the value-seeking firm is a mutuality of respect. The relevance and importance of others to the aims and purposes of the firm have to be acknowledged. Mutual respect strikes to the very heart of the issue of the dignity of the individual and the absolute conviction that the success of the enterprise depends upon each one's contribution. This applies not only to employees but to every other stakeholder, particularly customers and suppliers. In spite of complexity and global nature of business, such giants as Wal-Mart and Toyota strive toward meeting the needs of customers, which is a pervasive, ever-present consciousness of the centrality of value to a firm's mission. In addition to customer value is an ideal to strive for in the relationship among employees, customers, suppliers and other stakeholders. Rather than adopt an attitude of confrontation or alternate between cooperation and confrontation, depending upon the circumstances, critics argue that the high-value firm is best served by setting its sights on cooperative, harmonious relationships (Kerin et al 2005). 2. Sales force management is explained as the "analysis, planning, implementation, and control of sales force activities" (Kotler and Armstrong 2008, p. 456). This process helps to achieve effectiveness of performance and specific goals including maintenance of high standards. Analysis stage allows a company to evaluate and analyze skills and knowledge important for a position. Planning allows a company to avoid mistakes and use human resources effectively. It is possible to distinguish territorial sales force structure, product sales force structure and customer sales force structure (Kotler and Armstrong 2008, p. 454). This structure is aimed to provide the best possible approach to HR management and performance. The six steps are "designing sales force strategy and structure, recruiting and selecting employees, training and compensation, supervising and evaluating" (Kotler and Armstrong 2008, p. 454). Access to information about employees should not be granted as a special favor but as a matter of course, particularly if it will improve service to customers. In current management practices it is supposed that the six steps approach is important because it allows a company to control and direct employees, manage and coordinate their efforts. Taking into account this approach and peculiarities of the industries (such as environmental changes connecting with service quality), it is evident that this approach fits current needs of any business. Benchmarking has its uses as a means of identifying areas for innovation or development which are practiced to good effect in different business sectors, but having learned about what works and, ideally, what does not work in comparable organizations (Kerin et al 2005). Following Kotler and Armstrong 2008: "organization sales force around customers can help a company build closer relations with important customers" (p. 455). Recruitment and selection programs will help any company to ensure adequate supply of staff and their performance. Effective recruitment and selection of employees for the core workforce that provides the organization with stability and continuity has become essential for organizational survival and presents another set of challenges. There is already intense competition for workers who are talented enough to be a part of the core, and this is predicted to become even fiercer. Each member of the core is expected to perform multiple "jobs" and handle multiple responsibilities, as well as to maintain long-term loyalty to the organization. Thus, organizations need to attract and select workers who will not jump ship but who can keep their bearings when pushed (Boone and Kurtz 2007). Every company values unique talents among employees and commitment. Compensation rates depend upon superior performance, productivity, flexibility, and the ability to deliver high levels of service. People also provide the key to managing the pivotal interdependencies across functional activities and the important external relationships. It can be argued that one of the benefits arising from competitive advantage based on the effective management of people is that such an advantage is hard to imitate. Kerin et al (2005) admit that training could help to improve communication and behavior, improve personal selling and customer relations. Thus, it should be les judged more by the situational variables than the absolute correctness of the behavior. A special attention should be paid to specific cultural characteristics such as synchrony, gestures, etiquette and eye contact. The last two issues offer useful insights into how people evaluate body movement and gestures. Evaluation lies in its capacity to validate the assumptions, constructs, and ideas management has about other people's actions (Boone and Kurtz 2007). Because making inferences is part of the transactional process, use of training and practice, coupled with a feedback and analysis, allows individuals to move toward clearer interpersonal understanding. For instance, Microsoft and Dell pay a special attention to recruitment and selection in order to ensure professional staff and high quality of all products. Accomplishing the goals and designing the process for achieving them are different issues. HR professionals do not have to fulfill all four roles themselves. Depending on the processes designed to reach the goal, the work may be shared by line managers, outside consultants, employees, technology, or other delivery mechanisms for HR activities. The tasks of the department will be to develop HR programs, implement thee programs, measure their success and introduce necessary changes in HRM (Boone and Kurtz 2007). 3. Personal selling is a form of retailing since firms sell (by definition) directly to consumers. Even so, personal selling is not used in most retailing environments, not is it considered by most retailing analysts or observers as being a part of the industry. Rather, it is treated separately from or simply as an adjunct to the industry, or it is ignored (Boone and Kurtz 2007). Following Kotler and Armstrong (2008): "personal selling consist of interpersonal interactions with customers and prospects to make sales and maintain customer relationships" (p. 452). If direct selling were included in retailing, the question would arise of what firms should be treated as direct sellers (Boone and Kurtz 2007). Personal selling can be defined as a method of distribution of consumer goods and services through personal contact (salesperson to buyer) away from a fixed business location. These emphasis is on personal contact at a nonstore location convenient to the customer either individually (one-on-one at the consumer's home) or at an in-home party hosted by a consumer, reinforced with a high degree of personal service. An additional feature of some DS organizations is a multilevel organization wherein salespeople recruit others to become salespeople and benefit from the productivity of the latter. This chain can continue as a recruited salesperson becomes a recruiter of others. The recruited salespeople (and others further down the chain) become the "downline" of the recruiter, and various arrangements exist among multilevel firms to compensate the salesperson for sales by his or her downline (Boone and Kurtz 2007). The largest category in sales volume is household products, which includes cookware, tableware, kitchen and decorative accessories, vacuum cleaners and other appliances, security alarms, household cleaning products, water filters, nutritional products, and foods and beverages (Kerin et al 2005). The largest category involves personal care and beauty items, including primarily cosmetics, fragrances, skin care items, and jewelry, as well as clothing and shoes. Leisure and educational products make up the third category, encompassing encyclopedias and other educational publications, toys, crafts and hobby items, computers and software, and various self-improvement or vocational training programs (Kerin et al 2005). Kotler and Armstrong (2008) distinguish transaction-oriented marketing and relationship marketing. The aim of transaction oriented marketing is to "help sales people close a specific sale with a customer" (p. 468). The main advantages, in descending order, include convenience, personal attention, and ability to examine the product and/or talk with the seller. Relationship marketing is "targeted a major customer that it would like to win and keep' (p. 468). Major disadvantages involve pushy or high-pressure salespeople, inconvenient or bothersome interruption, and problems with salespeople's reliability, service, or accessibility after the sale. Price is seen as an advantage by some and as a disadvantage by an equal number of others, whereas product variety or selection is seen more as a disadvantage (Kerin et al 2005). While there are some changes in the order of these rankings depending on which personal selling mode is being evaluated, the patterns from one mode to the next and also from one demographic category of customers to the next are much more similar than different. The examples of personal selling companies are Avon and Oriflame. These firms have incorporated these increasingly popular channels of communication into their selling network. While the independent salesperson is still their primary marketing effort, these firms have expanded their use of advertising and direct mail to maintain consumer awareness and interest and to support the salespeople's efforts (Kerin et al 2005). These firms are quick to point out, however, that customer orders generated by the toll-free numbers or direct mail pieces are steered to their salespeople to fulfill. This maintains the preeminence of the independent salesperson, the key of success for such firms. A personal service relationship is preserved between customer and salesperson, and salespeople view the 800 numbers and direct mail efforts as truly support methods rather than ways of competing with them and cannibalizing their market (Kerin et al 2005). 4 "Sales promotion consists of short-term insensitive to encourage purchase and sales of a product or service" (Kotler and Armstrong, 2008, p. 468). Promotion of services and products can follow traditional lines. Advertising, for instance, is commonplace for all types of services while point-of-sale publicity (hairdressers suggesting alternative styling, auto mechanics who offer discounted rates to customers who have come to them for preventive maintenance, temptingly displayed desserts at your favorite restaurant, etc.) also often follows a parallel track to retailers' efforts, with which most of us are familiar, to encourage impulse buying. In the aspect of value communication, direct two-way information transfer between customer and firm, service businesses enjoy an edge, because the customer is in the system. Their needs are therefore not remote and to be inferred but right here and given expression to. The likelihood of a firm being able to match customer needs exactly is correspondingly higher, provided the firm can customize its services. It is possible to distinguish consumer promotions, trade promotions, business promotions and sales force promotions, The main elements of development stage are planning and evaluation. Through promotion, a company unleashes stimuli and supplies the marketplace or components of the marketing network with informative and persuasive messages in order to stimulate, reinforce, or modify behavior. In order to develop a sales promotion campaign, the customer analyzes its target market, their values and needs. Then, it selects the main channels of communication and promotions in order to reach this target audience. An interactive relationship with customers often develops in many service arenas while the service is being rendered. The customer could explain his/her needs and often receive service in real time. Again feedback could also be instant, resulting in high communicated value, provided responsiveness, flexibility, and learning ability are incorporated into the system. Conversely, through feedback the marketplace and marketing network transmit information to a company. Feedback provides useful information for the direction and control of promotion, and indicates adjustments that may be made in the media, form, message, and content of the communications, as well as in the other aspects of the marketing mix. The main sales promotion tools are samples, coupons, rebates, price packs, premiums, advertising specialties, rewards, point-of-purchase promotions, contests. For trade promotions, companies use free goods and price-off programs. Although discussed as a component of the marketing intelligence system feedback is viewed here as part of market communications which includes advertising, personal selling, sales promotion, and related activities. Promotion is designed to affect purchases by causing changes in buyer behavior and reactions. Advertising, personal selling, sale promotions, product development, pricing, and other marketing decisions endeavor to elicit favorable reactions from customers. They attempt to expand and shift demand for company products, thus extending market opportunity. Promotion decisions are affected by the how and why of customer and consumer behavior. Understanding buyer behavior is fundamental to the development of effective marketing systems. Significant relationships between consumption processes and corporate actions are investigated. Consumers provide the economic rationale for business activity. Purchases made on emotional bases can indeed meet important consumer needs. Several useful behavioral models and concepts that help explain purchase response, as well as a chart of consumption as problem solving, are given. Promotion and personal selling may be used as complementary or supplementary market-communications activities. Their respective roles depend on company products, customers, and markets. Often they are used in a complementary manner, with advertising paving the way for personal-selling activities. In other situations, such as in making industrial sales, personal selling is usually the most important component, while advertising may be a supplementary activity that helps create awareness. In either case, both should be coordinated by marketing managers. References 1. Boone, L. E., Kurtz, D. L. (2007). Contemporary Marketing. South-Western College Pub. 2. Kerin, R. A., Hartley, S. W., Berkowitz, E. N. Rudelins, W. (2005). Marketing. McGraw-Hill Higher Education. 3. Kotler, P., & Armstrong, G. (2008). Principles of Marketing. 12th ed. Prentice Hall. Read More