question

Transaction selling

answer

involving separate organizations entering into an independent transaction involving the delivery of a product or service in return for compensation

question

Relationship selling

answer

narrows the vendor pool, improves efficiencies, works directly with customers to solve problems

question

Relationship selling example #1

answer

Xerox has identified few than 500 vendors with which it wants to do business. In contrast, 5000 vendors were supplying Xerox. As a result of buyers narrowing their vendor pool, salespeople are being asked to do more, working with customers, to solve their problems, improve efficiencies, and, in general, add value to their customers' business.

question

Relationship selling example #2

answer

Procter & Gamble has aggressively reorganized its clients teams so they are stationed very close to the company's major accounts.

question

Leading versus managing

answer

an important distinction for today's successful sales manager. Effective sales management is now more often defined by how good a leader you are than how good a manager.

question

Leading

answer

- Mentoring - Communicate - Cheerleader/coach - Empower to make decisions

question

Managing

answer

- Control - Supervisor/boss - Direct

question

Sales Management

answer

all activities, processes, and decisions involved in managing the sales function in an organization

question

Sales Management Process

answer

process of effective management of a company's sales force, involves three interrelated sets a decisions or processes; formulation, implementation, evaluation and control.

question

Formulation of a sales program

answer

The sales program should consider the environmental factors faced by the firm. Sales executives organize and plan the company's overall personal selling efforts and integrate these with the other elements of the firm's marketing strategy.

question

Implementation of the sales program

answer

Involves selecting appropriate sales personnel and designing implementing approaches that will direct their efforts toward the desired objectives.

question

Evaluation and control of the sales program

answer

Involves developing methods for monitoring and evaluating sales force performance through appropriate metrics. Allows for adjustments of the sales program or the way it is implemented when performances is unsatisfactory .

question

External Environment

answer

factors are beyond the control of the individual manager; however, companies do try to influence conditions to the extent they can through political lobbying, public relations campaigns, and the like.

question

Economic Environment

answer

- Factors must be considered when analyzing market opportunities and developing sales forecasts: amount of growth, the unemployment rate, and the level of inflations. - Global conditions also influence many firms' ability to earn a profit (important) - Existing distribution structure in an industry: number, types, and availability of wholesalers, retailers, and other intermediaries a firm might use to distribute its product. - Competitive structure affects selling success.

question

Legal and Political Environment

answer

- Increased number of laws regulate conduct of business 3 broad categories of relevant laws: - Antitrust - Consumer Protection - Equal Employment Opportunity

question

Antitrust Provisions

answer

Robinson-Patman Act - Tying agreements - Reciprocal dealing arrangments Federal Trade Commmission Act - Unfair methods of competition

question

Consumer Protection Provisions

answer

The Fair Packaging and Labeling Act The Truth-in-Lending Act The Federal Trade Commision

question

Technological Environment

answer

-Changes how salespeople/sales managers do their jobs -Influences sales strategies -Provides opportunities for product development -Transportation, communications, and data processing change: sales territories, sales rep deployment, sales performance evaluation

question

Technological (example)

answer

3M - more than half of the current sales volume is generated by products that were not in existence five years ago.

question

Social and Cultural Environment

answer

-Ethics - Sales managers: relationships with salespeople; interactions between salespeople and customers - Managers can influence ethical performance by exmaple - Ethical standards reflect integrity of firm

question

Ethics

answer

Development of moral standards by which actions and situations can be judged. It focuses on those actions that may result in actual or potential harm of some kind (e.g, economic, mental, physical) to an individual, group, or organization.

question

Natural Environment

answer

- Influences demand for products: weather, natural disasters, availability of raw materials, energy resources - Shortages may cause demarketing - Social concern about possible negative environment impact of product and production

question

Demarketing

answer

The sales organization may be engaged in part or all of its product line. The sales force is often required to help administer rationing programs, which allocate scarce supplies according to each customer's purchase history.

question

Internal Organizational Environment

answer

1. goals, objectives, and culture 2. human resoucres 3. financial resources 4. production and supply chain capabilities 5. service capabilities 6. research and development and technological capabilities

question

Corporate Culture

answer

A well-defined mission together with a successful corporate history and top management's values and beliefs leads to a strong development

question

Drivers of change

answer

1. Building long-term relationships 2. Creating sales organizational structures that are more nimble and adaptable to the needs of different customer groups 3. Gaining greater job ownership and commitment from salespeople 4. Shifting sales management style from commanding to coaching 5. Leveraging available technology for sales success 6. Better integrating salesperson performance evaluation

question

Autonomy

answer

The freedom of action and opportunities for personal initiative

question

Sales activities

answer

multifaceted and challenging activities as part of the job

question

Job variety

answer

Most people become bored doing routine tasks. Boredom is seldom (not common) a problem among professional salespeople. Each customer has different needs and problems for which the salesperson can work to develop unique solutions. A salesperson must display insight, creativity, and analytical skill to close a sale.

question

Intrinsic rewards

answer

rewards inherent satisfaction derived from elements of the job or role itself

question

Extrinsic rewards

answer

rewards bestowed (honored) on the salesperson by the company

question

Work-family conflict

answer

represents a lack of balance between one's work life and family life such that work is encroaching (intruding) on family

question

Adaptive selling

answer

the altering of sales behaviors during a customer interaction or across customer interactions based on perceived information about the nature of the selling situation.

question

Job enlargement

answer

the sales tole today is broader than in the past and contains substantially more activities

question

Cost of a sales call

answer

- The increasing involvement of salespeople in nonselling activities. - It takes the performance of many nonselling activities over a long period of time to successfully practice relationship selling.

question

Trade servicer

answer

-The sales force's primary responsibility is to increase business from current and potential customers by providing them with merchandising and promotional assistance. -The group of resellers such as retailers or distributors with whom this sales force does business.

question

Trade selling (example)

answer

A Procter & Gamble salesperson selling soap and laundry products to chain-store personnel

question

Missionary Seller

answer

-The sales force's primary job is to increase business from current and potential customers by providing them with product information and other personal selling assistance -Salespeople often do not take orders from customers directly but persuade customers to buy their firm's product from distributors or other wholesale suppliers

question

Missionary selling (example)

answer

Anheuser-Busch: its salespeople call on bar owners and encourage them to order a particular brand of beer from the local Budweiser distributor

question

Missionary detailers (example)

answer

Pharmaceutical reps call on doctors as representatives of pharmaceutical manufacturers.

question

Technical seller

answer

- The sales force's primary responsibility is to increase business from current and potential customers by providing them with technical and engineering information and assistance. - Accomplished through cross-functional selling teams

question

Technical selling (example)

answer

A sales engineer from the General Electric jet engine company calling on Boeing.

question

New business seller

answer

The sales force's primary responsibility is to identify and obtain business from new customers. In relationship selling, this is analogous to a focus on securing and building the customer relationship

question

Initiators

answer

the people who perceive a problem or opportunity that may require the purchase of a new product service and thereby start the buying process.

question

Users

answer

the people in the organization who must use or work with the product or service

question

Influencers

answer

provide information evaluating alternative products and suppliers, and often play a major role in determining the specifications and criteria to use in making the purchase decision.

question

Gatekeepers

answer

Control the flow of information to other people involved in the purchasing process - control information. 2 types: screens and filters

question

Buyer

answer

the person who actually contacts the selling organization and places the order/have authority to negotiate purcahses

question

Decider

answer

the person with the final authority to make a purchase decision.

question

Initiator buying roll (example)

answer

Complaints from maintenance workers and American Airlines about outmoded and inefficient equipment, for instance, might trigger the purchase of new machines.

question

User buying roll (example)

answer

Drill-press operators at American Airlines might request that the purchasing agent buy drill bits from a particular supplier because they stay sharp longer and reduce downtime in the plant

question

Influencer buying roll (example)

answer

At American Airlines, flight engineers or pilots often influence purchase decisions on the basis of their experience with the performance of various vendor options.

question

Gatekeeper buying roll (example)

answer

-secretaries and American Airlines who can decide whose telephone call is put through to the executive or purchasing agent -American Airlines purchasing agent who gathers proposals from 3 different companies and decides what to tell others in the buying center about each company

question

Buyer buying roll (example)

answer

At American Airlines, the level of authority to buy is determined by the size and type of purchase involved.

question

Decider buying roll (example)

answer

When American Airlines buys a complete, systemwide computer installation and upgrade, for instance, the final decision is likely to be made by the CEO or a top management committee.

question

Perceived risk

answer

a function of the complexity of the product and situation, the relative importance of the purchase, time pressure to make a decision, and the degree of uncertainty about the product's efficacy.

question

Selling center

answer

brings together individuals from around the organization (marketing, customer service, sales, engineering, and others) to help the salesperson do his or her job more effectively

question

Team selling

answer

structure within the sales organization that best meets customers needs

question

Key account

answer

team managed by senior salesperson dedicated to serving important customer

question

Organizational buying decision staages

answer

1. anticipation or recognition of a problem or need 2. determination and description of the traits and quality of the needed items 3. search for the qualification of potential suppliers 4. acquisition and analysis of proposals or bids 5. evaluation of proposals and selection of suppliers 6. selection of an order routine 7. performance evaluation and feedback

question

Stage 1

answer

anticipation or recognition of a problem or need

question

Stage 2

answer

determination and description of the traits and quality of the needed items

question

Stage 3

answer

search for the qualification of potential suppliers

question

Stage 4

answer

acquisition and analysis of proposals or bids

question

Stage 5

answer

evaluation of proposals and selection of suppliers

question

Stage 6

answer

selection of an order routine

question

Stage 7

answer

performance evaluation and feedback

question

Derived demand

answer

-Many organizational purchases are motivated by the requirements of the firm's production process, merchandise inventory, or day-to-day operations (demand for goods and services)

question

Single-sourced suppliers

answer

minimize the variation in quality of production inputs

question

new-task purchases

answer

a customer is buying a relatively complex and expensive product or service for the firm time (e.g., a new piece of production equipment or a new computer system)

question

modified rebuy

answer

a customer is interested in modifying the product specifications, prices, or other terms it has been receiving from existing suppliers and is willing to consider dealing with new suppliers to make these things happen

question

straight rebuy

answer

a customer is reordering an item it has purchased many times (e.g., office supplies, bulk chemicals)

question

Marketing concept

answer

strategic decisions about what products to market, where to market the products and how to get them to market, at what price, and how to communicate with consumers about the products

question

Marketing mix

answer

4 elements: product, distribution, price, and promotion Represent the "tool kit" marketers use to develop marketing strategy

question

Marketing communication mix

answer

-Promotion mix -Personal selling -Advertising, sales promotion, direct marketing, and public relations and publicity

question

Marketing orientation

answer

-Operationalization or implementation of the marketing concept -Focuses on aligning all the various organizational processes and functions toward maximizing the firm's success in the competitive marketplace -Successful salespeople think beyond "selling" -Market-driven companies do better market sensing -Market-driven companies develop stronger relationships with customers and channels -Internal partnering a critical component

question

Customer orientation

answer

-Customer drives the marketing strategy, which is driven by the marketing mix -Customer is the center of all marketing activities, and CRM software and touch points help ensure that the customer is accurately captured and monitored

question

Customer-centric

answer

-Partnership business model with shared risks and rewards -Selling as customer business consultation -Formalized customer analysis processes and agreements -Proactively educating customers about value chain and cost reduction opportunities -Focus on continuous improvement principles stressing customer satisfaction

question

Customer relationship management (CRM)

answer

-A comprehensive business model for increasing revenues and profits by focusing on customers -Overarching business philosophy and process tool to facilitate a customer-driven enterprise

question

Advantages of CRM

answer

-Reduces advertising costs -Increases awareness of customer needs -Tracks effectiveness of promotional campaigns -Competition for customers based on service, not prices -Prevents over-spending on low-value clients, under-spending on high-value ones -Speeds time to develop and market a product -Improves use of customer channel

question

Touchpoints

answer

the intersection of a business event that takes place via a channel using a medium (e.g., online inquiry from a prospect, telephone follow-up with a purchaser on a service issue, face-to-face encounter with a salesperson)

question

Mass Marketing

answer

Characteristics: market share, individual sales, limited segmentation, huge campaigns, not cost-effective, single treatments, focus on transactions, number of relationships Technology: in-house, outsourced mailings, flat files/mailing lists, some packaged applications

question

Target Marketing

answer

Apply principles of segmentation and positioning to create different strategies and marketing programs for different consumer groups Characteristics: segmented campaigns, small mass marketing, focus on products Technology: individual databases, application for products, proprietary solutions, limited analysis

question

Customer Marketing

answer

a focus on developing relationships with individuals Characteristics: lifetime value, multiple treatments Technology: data warehouse, integrated data and applications

question

One-to-one Marketing

answer

firms are now able to truly customize offerings for individual users Characteristics: interactive segmentation, real-time matching, interactive TV, active web pages Technology: internet enabled, many touchpoints integrated, cross-organization process

question

Customer value

answer

when the customer weighs the costs of a relationship with a seller, the benefits realized from that relationship outweigh the costs.

question

Customer loyalty

answer

-important goal of CRM processes -typically highly satisfied with the relationship and the product offering and are very unlikely to switch to another company and its products or brands

question

Lifetime value of a customer

answer

-One of the most important concepts in CRM** -investment in CRM yields more successful long-term relationships with customers and that these relationships pay off handsomely in terms of cost savings, revenue growth, profits, and referrals.

question

CRM Process Cycle

answer

1. knowledge discovery 2. market planning 3. customer interaction 4. analysis and refinement

question

Data mining

answer

techniques to learn more about current and potential customers. A variety of software products are available to help manage the knowledge discovery phase.

question

Return on customer investment

answer

adjustments made to the firm's overall customer initiatives should yield more and more efficient investment of resources in the endeavor (maximized)

question

Strategic direction

answer

Clarity in mission and goals provides the focus on which a firm's marketing strategy may be built and implemented

question

Mission statement

answer

attempts to answer the most basic questions about its reason for being. What is our business? What should it be? Seem like simple questions, but they are often difficult for management to answer.

question

Goals

answer

flow from the company's mission and represent more specific targets the firm wishes to meet example: a firm's financial position, how well it's doing in the marketplace, the quality of its products, and the level of satisfaction of its customers.

question

Objectives

answer

should always be specific, measurable, and realistically attainable.

question

Strategic business units (SBUs)

answer

May contain a number of different products or brands, and its competitive strategy will influence and constrain the marketing goals/objectives, strategies, and functional programs - including the activities of the sales force - appropriate for each of those products.

question

Strategic business units (SBU) example

answer

General Electric has many global strategic business units competing in quite distinct markets - appliances, aircraft, plastics, and power systems.

question

Sustainable competitive advantage (SCA)

answer

The keystone of a business-level strategy is a decision about how the business will compete it its industry

question

Distinctive competencies

answer

-SCA is based on this -What quality or attribute of the organization sets it aside from its competitors? -How is it, or how will it be, different from the rest of the pack?

question

Distinctive competencies (example)

answer

Hyundai; its unique mix of product quality, desirable features, and reasonable price.

question

Marketing opportunity

answer

exists whenever some human need is unsatisfied. However, an unsatisfied need represents a viable and attractive opportunity for a firm only if: 1. The opportunity is consistent with the mission and objectives of the firms. 2. Enough potential customers exist for the needed product or service so the total potential sales volume is, or will be, substantial. 3. The firm has the necessary resources and expertise to capture an adequate share of the total market.

question

Functional relationships

answer

Long-term relationships between buyer and seller based on close personal friendships. These personal relationships create a climate of cooperation, with open and honest communication.

question

Functional relationships (example)

answer

financial planning (where the broker becomes a trusted confidant of the client) and contract manufacturing, an industry where salespeople develop strong relationships with product designers so that the sellers' components are included in new products.

question

Strategic partnerships

answer

long-term relationships in which the partners make significant investments to improve the profitability of both companies and jointly achieve strategic objectives

question

Full-line selling

answer

Selling the entire line of associated products. Many companies try to get their foot in the door with any sale in order to prove their company's worth as a supplier. The hope is that the buyer will want to purchase after trying out the company.

question

Cross-selling

answer

-Works best when the salesperson can leverage the existing relationship with the buyer. -Trust in the the salesperson and the selling organization already exists; therefore, the sale should not be a difficult if the proper needs exist.

question

Preferred supplier

answer

-When the buyer-seller relationship has reached the commitment stage, a stated or implied pledge to continue the relationship is in place. -The supplier is assured a large percentage of the buyer's business and and will get the first opportunity to earn any new business.

question

Integrated marketing communication (IMC)

answer

The various ways the firm strategically communicates its message about its products to the marketplace. -Effectively integrates personal selling, advertising and other communications options

question

Push strategy

answer

-Attempts to build strong customer demand for its brand. -Encourages wholesalers and retailers to carry the product to satisfy their customers and reap the resulting sales and profits

question

Pull strategy

answer

-builds reseller support; it offers direct incentives to potential wholesalers and retailers to encourage them to stock the product. Incentives offered to resellers: just-in-time reorder and delivery and category management

question

Selling team

answer

Representatives from various functional departments of the company to a single customer

question

Division and Specialization of Labor

answer

-Increase productivity - specialists can become proficient at assigned tasks -Divide required selling activities to gain maximum benefits within the sales force

question

Line organization

answer

-A type of vertical organization in which the chain of command runs from the chief sales executive down through levels of subordinates -Chain of command runs from chief sales executive down through levels of subordinates -Each subordinate responsible to one person

question

Line and staff organization

answer

-Most common form of vertical organization structure, especially in medium and large-sized firms -Several sales management activities are assigned to separate specialists

question

Outsourcing the sales forces

answer

indicate the use of agents

question

Manufacturers representatives

answer

-Intermediaries who sell part of the output of their principals on an extended contract basis. -They take neither ownership nor physical possession of the goods they sell but concentrate instead on the selling function

question

Selling agents

answer

Intermediaries who do not take title or possession of the goods they sell and are compensated solely by commissions from their principals

question

Transaction cost analysis (TCA)

answer

when substantial transaction-specific assets are necessary to sell a manufacturer's products, the cost of using and administering independent agents are likely to be higher than the costs of hiring and managing a company sales force.

question

Product organization

answer

-Companies have separate sales forces for each product or product category in their line -individual salespeople can develop familiarity with the technical attributes, applications, and the most effective selling methods associated with a single product or related products.

question

Product organization (example)

answer

3M has more than 50 divisions manufacturing a diverse assortment of products ranging from scotch tape to abrasives to medical equipment.

question

Organization by customer type

answer

-A natural extension of the marketing concept and reflects a strategy of market segmentation -Advantage: salespeople become familiar with their customers' specific business needs; they are more likely to discover ideas for new products and marketing approaches that will appeal to those customers.

question

Organization by selling function

answer

Sales force specialize in prospecting for and developing new accounts, while a second force maintains and services old customers

question

Major and Key Accounts

answer

-Separate corporate division/sales force -Deliver high-level customer service to attract and maintain large and important customers

question

Key account sales execs

answer

-Business managers capable of managing key accounts -Customize products and services -Plan and implement key account business plans

question

Span on Control

answer

Dictated by managers and levels of management; the more of these there are, the lower the span of control, and vice versa.

question

Reduce span of control

answer

-Sales task is complex -Profit impact of each salesperson's performance is high -Salespeople are well paid and professional -Also, at higher levels in the organization

Sales Management Exam 1 (Ch. 1-4) – Flashcards

Unlock all answers in this set

Haven't found what you were looking for?

Search for samples, answers to your questions and flashcards