Global Marketing Global Marketing Communications Decisions II: Sales

Global Marketing Global Marketing Communications Decisions II: Sales

Global Marketing Global Marketing Communications Decisions II: Sales Promotion, Personal Selling, and Special Forms of Marketing Communication WARREN J. KEEGAN C. GREEN ChapterMARK 14 Ninth Edition, Global Edition Copyright 2017 Pearson Education, Ltd. Learning Objectives 1. Define sales promotion and identify the most important

promotion tactics and tools used by global marketers. 2. List the steps in the strategic/ consultative selling model. 3. Explain the contingency factors that must be considered when making decisions about sales force nationality. 4. Explain direct marketings advantages and identify the most common types of direct marketing channels. 5. Identify special forms of marketing communication and explain how global marketers integrate them into the overall promotion mix. Copyright 2017 Pearson Education, Ltd. 14-2 Sales Promotion Sales promotion refers to any paid consumer or

trade communication program of limited duration that adds tangible value to a product or brand Price vs. non-price promotions Consumer vs. trade promotions Axe Apollo featured astronaut Buzz Aldrin in promoting a free trip to space for 22 lucky winners. Copyright 2017 Pearson Education, Ltd.

14-3 Sales Promotion Provide a tangible incentive to buyers Reduce the perceived risk associated with purchasing a product Provide accountability for communications activity Provide method of collecting additional data for database Copyright 2017 Pearson Education, Ltd. 14-4 Sales Promotion: Global or Local In countries with low levels of economic

development, low incomes limit the range of promotional tools available Market maturity can also be different from country to country Local perceptions of a particular promotional tool or program can vary Local regulations may rule out use of a particular promotion in certain countries Trade structure in the retailing industry can affect the use of sales promotions Copyright 2017 Pearson Education, Ltd. 14-5 Sampling Sampling

Provides consumer with opportunity to try product at no cost May be distributed in stores, in the mail, through print media, at events, or door-to-door Kikkoman soy sauce launched a sampling program in supermarkets in the U.S.; today the U.S. contributes 85% of profit from international operations Copyright 2017 Pearson Education, Ltd. 14-6 Couponing Couponing Printed certificates entitle the bearer to a price reduction or some other special consideration

for purchasing a particular product Couponing accounts for 70% of consumer promotion spending in the U.S. Free-standing inserts, in-pack, on-pack, cross coupons Copyright 2017 Pearson Education, Ltd. 14-7 Social Couponing Hot online trend Groupon is industry leader Deals are made with local retailers with Groupon taking a percentage of proceeds Grown from 1 country to 35 mainly through

acquisition 40 million users in 48 global markets by 2012 Over 50% of users are in Europe, 33% in U.S. Founders rejected Googles $6 billion takeover offer Copyright 2017 Pearson Education, Ltd. 14-8 Sales Promotions Copyright 2017 Pearson Education, Ltd. 14-9 Sales Promotion:

Issues and Problems Fraud Pepsi promotion with Apple Regulations vary by country Cultural dispositions to coupons and other sales promotions Malaysians see coupon usage as embarrassing Islam frowns on gambling so sweepstakes may not work Copyright 2017 Pearson Education, Ltd. 14-10 Personal Selling

Person-to-person communication between a company representative and a prospective buyer Focus is to inform and persuade prospect Short-term goal: make a sale Long-term goal: build a relationship Copyright 2017 Pearson Education, Ltd. 14-11 Personal Selling Hurdles Political Risks unstable or corrupt governments change the rules for the sales team Regulatory Hurdles Governments can set up quotas or tariffs that affect the sales force

Currency Fluctuations increase and decrease in local currencies can make certain products unaffordable Market Unknowns lack of knowledge of market conditions, the accepted way of doing business, or positioning of the product may derail the sales teams efforts Copyright 2017 Pearson Education, Ltd. 14-12 The Strategic/Consultative Selling Model Evolved in response to: Increased competition More complex products

More emphasis on customer needs Long-term relationships Copyright 2017 Pearson Education, Ltd. 14-13 The Strategic/Consultative Selling Model Personal Selling Philosophy commitment to the marketing concept and a willingness to adopt the role of problem solver/partner Relationship Strategy game plan for establishing and maintaining high-quality relationships with prospects/customers

Product Strategy plan that can assist the sales representative in selecting and positioning products to satisfy customer needs Copyright 2017 Pearson Education, Ltd. 14-14 The Strategic/Consultative Selling Model Customer Strategy plan that ensures that the sales professional will be maximally responsive to customer needs Presentation Strategy consists of setting objectives for each sales call and establishing a presentation plan to meet those objectives Copyright 2017 Pearson Education, Ltd.

14-15 The Strategic/Consultative Selling Model Copyright 2017 Pearson Education, Ltd. 14-16 The Presentation Plan

Approach Presentation Demonstration Negotiation Close Servicing the sale Copyright 2017 Pearson Education, Ltd. 14-17 Approach & Presentation Approach Initial contact with the customer/ prospect Must completely

understand the decision-making process and the roles of each participant Presentation Prospects needs are assessed and matched to the companys products The style and message of the presentation must be tailored to the audience Copyright 2017 Pearson Education, Ltd.

14-18 Demonstration & Negotiation Demonstration Negotiation Salesperson has the Ensures that both the opportunity to tailor the customer and the communication effort to salesperson come away the customer from the presentation winners Can show how the

product can meet the customers needs Copyright 2017 Pearson Education, Ltd. 14-19 Close & Servicing the Sale Close Ask for the sale Must be culturally sensitive Servicing the Sale To ensure customer satisfaction

Implementation process must be outlined Customer service program established Copyright 2017 Pearson Education, Ltd. 14-20 Sales Force Nationality Expatriates

Host-country nationals Third-country nationals Other options Copyright 2017 Pearson Education, Ltd. 14-21 Expatriates Advantages Superior product knowledge Demonstrated commitment to service standards Train for promotion

Greater HQ control Disadvantages Higher cost Higher turnover Cost for language and cross-cultural training Copyright 2017 Pearson Education, Ltd. 14-22 Host-Country Nationals Advantages

Disadvantages Economical Superior market knowledge Language skills Superior cultural knowledge Fast implementation Needs product training May be held in low esteem Language skills may not be important

Difficult to ensure loyalty Copyright 2017 Pearson Education, Ltd. 14-23 Third-Country Nationals Advantages Cultural sensitivity Language skills Economical Allows regional sales coverage Disadvantages

May face identification problems May be blocked for promotions Income gaps Needs product and/or company training Loyalty not assured Copyright 2017 Pearson Education, Ltd. 14-24 Other Options Sales agents

Exclusive license arrangements Contract manufacturing or production Management-only agreements Joint ventures Copyright 2017 Pearson Education, Ltd. 14-25 Special Forms of Marketing Communications Direct Marketing Direct mail Catalogs Infomercials, teleshopping

Event Sponsorship Concerts, sporting events Product placement in movies Internet Communications Copyright 2017 Pearson Education, Ltd. 14-26 Direct Marketing Any communication with a consumer or business recipient that is designed to generate a response in the form of: An order Request for further information A visit to a store or other place of business

Copyright 2017 Pearson Education, Ltd. 14-27 One-to-One Marketing Building from Customer Relationship Management Identify customers and accumulate detailed information about them Differentiate customers and rank them in terms of their value to the company Interact with customers and develop more cost efficient and effective forms of interaction Customize the product/service offered to the customer

Copyright 2017 Pearson Education, Ltd. 14-28 Direct Marketing vs. Mass Marketing Copyright 2017 Pearson Education, Ltd. 14-29 Advice for U.S. Direct Marketers Going Global

The world is full of people who are not Americans. Be sure not to treat them like they are. Like politics, all marketing is local. Just because your direct mail campaign worked in Texas, do not assume it will work in Toronto. Although there may be a European Union, there is no such thing as a "European." Pick your target, focus on one country, and do your homework. Customers need to be able to return products locally or at least believe there are services available in their country. Copyright 2017 Pearson Education, Ltd. 14-30

Direct Mail A vehicle for delivering a personally addressed offer to a prospect targeted by a marketer Popular with banks, insurance co., other financial service providers U.S. direct mail lists are easy to rent; Europe and Japan lists are lower in quality Germans spend the most, $500 per capita, in mail-order shopping Copyright 2017 Pearson Education, Ltd. 14-31 Catalogs

German supermodel Yvonne Catterfeld with Otto Catalog Catalog: magazine-style publication that features photographs, illustrations, and extensive information about a companys products U.S. 1/3 of world market, 17 billion mailed in 2008 EU: Elimination of barriers has led to a boom Hong Kong and Singapore have efficient postal systems and highly educated consumers with credit cards

Copyright 2017 Pearson Education, Ltd. 14-32 Infomercials and Teleshopping An infomercial is a form of paid TV in which a particular product is demonstrated, explained, and offered for sale to viewers who call a toll-free number on the screen In Asia, infomercials make $100s of millions in sales. Low penetration rates of private phones, credit cards & delivery issues create difficulties Teleshopping on channels like HSN and QVC is exclusively devoted to demonstration and selling Copyright 2017 Pearson Education, Ltd.

14-33 Interactive Television ITV allows viewers to interact with the programming content they are viewing In the U.K., more than half of pay-TV subscribers use ITV Remote controls have buttons to push to order products shown on screen Copyright 2017 Pearson Education, Ltd. 14-34 Outdoor Ad Spending as a

Percentage of Total Ad Spending Copyright 2017 Pearson Education, Ltd. 14-35 Sponsorships A company pays a fee to be associated with an event, team, athletic association, or sports facility Combines elements of PR and sales promotion Draws media attention Copyright 2017 Pearson Education, Ltd.

14-36 Product Placement Arranging to have the companys products and brand names appear in TV shows, movies, and other types of entertainment Marketers also lend or donate products to celebrities and other public figures Issue for Marketers: Once seen in a movie, products cannot be easily adapted to meet local market needs Copyright 2017 Pearson Education, Ltd. 14-37

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