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STRATEGIC MARKETING & PLANNING

Companies may use a combination of sales people, direct marketing and the Internet to make customer contacts. The growth of Internet is affecting the traditional role of salespeople The underlying logic of direct marketing is making direct contact with end-user customers through alternative media.
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During the 2000s, Boeing experienced an intense competitive battle against Airbus, for control of the commercial jetliner market. Airbus was winning the battle until 2005.

Boeing had lost many sales to Airbus because of top managements unwillingness to give competent professionals flexibility in negotiating sales.
Under a new CEO, James McNerney, Boeing management gave salespeople more control over selling strategy compared to rigid control maintained by the previous top management.
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Salespeople like Larry Dickenson, Boeings top salesman who covers the Asia-Pacific market, had relationships with airlines like Cathay Pacific, Qantas Airways Ltd., and Singapore Airlines, Ltd., over 18 years, and had negotiated winning contracts.

His strategy is a combination of attractive pricing, financing, and leasing arrangements in combinations with training and service packages. Boeing won many contracts in the two years that Larry remained head of Salesbut Boeing was embroiled in other problems that gave Airbus the edge.
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Salespeoples responsibilities may range from being simple order-takers to being seen as consultants to customers.

Factors influencing the role of personal selling in an organization: 1. Marketing objectives & strategy 2. Target Market 3. Product/ service characteristics 4. Distribution policies 5. Pricing policies 6. Communication tasks to be accomplished.
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1.

Transactional selling: price based, used mainly for commodities; Feature/benefit selling: commonly used for consumer products;

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Solution selling: matching clients needs, designing special solutions;


Value-added selling: originally used in consulting type relationships, with high compensation, now expanding in scope.
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4.

A typical selling process comprises:


1. Prospecting for customers; 2. Opening the relationship; 3. Qualifying the prospect;

4. Presenting the sales message;


5. Closing the sale; 6. Servicing the account.

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i2 Technologies Inc. provides software &

consulting services to corporate clients for supply chain, product life cycle, & customers relationship management.

Sales had grown from $ 362 million in 1998 to $ 800 million + in 2001. But, sales in 2002 partly due to the global economic slowdown.
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The i2 selling had concentrated on forming long-term relationships with corporate clients expensive software applications made that necessary. Big-ticket clients included Caterpillar, Dell Computer, General Electric, and most were displaying a major slowdown.

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Management responded by altering selling process.

i2s

The new strategy called for driving growth by concentrating on less expensive and more focused projects. Sales would also require shorten time span for skills development, compared to six months required for big projects.
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This change in focus involves a major change in the selling approach. The new strategy reflected the realities of a weak economy - but shifted corporate customers attention towards more focused projects. The strategy shift has moved i2 into a different competitive environment and one that has brought the company success!

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1. Customer Buying Power: Differences

in customers result from differences in: Size/ volume of purchase; Frequency of purchase Delivery locations.
2. Complexity of customer relationship:

complex customers require greater use of customer management strategies &/ or customer databases.
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3. Customer threshold levels:

customers buying power influences selection of selling channels. B2B or B2C Value of multiple selling channels strategy should be carefully determined based on time & effort needed for servicing.
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TWO COMPONENTS OF DESIGN: 1. Organizational structure: One that

supports the firms sales force strategy. Important influences on organizational design: 1. Type of customer base; 2. Product type; & 3. Geographic location of buyers.
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Simple product offering

Customer needs different Market Product/Market driven driven design design Geographydriven design Product driven design

Complex product offering

Customer needs similar


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TWO COMPONENTS OF DESIGN:

2. Sales force size & deployment:

Factors to be kept in mind: a) Market potential; b) Number & location of customers; c) Intensity of competition & d) Market standing of company.

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Sales force selection: General

considerations: 1. Being committed & customerdriven; 2. Accepting direction, cooperating with team; 3. Being motivated by ones peers.
Sales force training: Formal or

informal; On the job or otherwise. Supervising & motivating sales force; Performance evaluation.
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Determining objectives first:


1. 2. 3. 4. 5.

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Disseminating information Creating Awareness Brand building Encouraging trial Improving customer service Expanding distribution.

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E-Commerce Strategy: enabling buyers to purchase products in a convenient & efficient manner offering a compelling set of benefits, & metrics to evaluate impact.

Properly designed web-based initiatives create new opportunities for growth; Risk is high because of sudden changes in audience characteristics or access & response delays, or potential for deception etc.

Ad impressions, clicks, unique visitors, total visits, page impressions & more. Nielsen Ad Effectiveness criteria: Brand familiarity Brand consideration Purchase propensity Creative execution effectiveness Placement impact Frequency of exposure influence.

THE BIG GUNS ARRIVE After early struggles, online sales at brick-andmortar giants such as Wal-Mart, Sears, and Gap are soaring. These chains are also using the Web to test new products and move into new markets. NICHES GO NATIONAL More and more niche players are succeeding by offering variety rivals cant match. Luggage seller eBags, for example, is able to stock 12,000 styles, compared with 250 in a typical store.

SEARCH LENDS A HAND Using Google and similar Websites, consumers can search far and wide for specialized products say, stainless-steel farm sinks. Thats creating markets for lesser known brands and new merchants. MORE PRICING PRESSURES Shoppers are increasingly using price-comparison sites such as Shopping.com and Shopzilla. The result: Ever more cutthroat competition for brickand-mortar and online stores alike.

In keeping with Socio-economic Trends Time constraints/convenience Low Access Costs Much lower than face-to-face contact Data Base Management Facilitates direct marketing initiatives Value Provides an attractive bundle of value.