Sales Management > Chapter 1: Sales Function & Strategies > Flashcards

Chapter 1: Sales Function & Strategies Flashcards

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1
Q

What are the different types of sales markets?

A
  • For Profit
  • Non-Profit
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2
Q

What is the strategic goal for “For Profit” sales markets?

A

Competitiveness

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3
Q

What is the strategic goal for “Non-Profit” sales markets?

A

Mission effectiveness

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4
Q

What are success factors for “For Profit” sales markets?

A
  • Market Share
  • Growth Rate
  • Earnings
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5
Q

What are success factors for “Non-Profit” sales markets?

A
  • Management Practices
  • Social Impact
  • Cost Efficiency
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6
Q

What do “For Profit” sales markets value?

A
  • Innovation
  • Creativity
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7
Q

What do “Non-Profit” sales markets value?

A
  • Accountability to public
  • Integrity
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8
Q

Name the 4 Sales strategies to implement into a market

A
  • Build
  • Hold
  • Harvest
  • Divest
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9
Q

What are the sales objectives of the Build strategy?

A
  • Build sales volume
  • Increase distribution
  • Provide high service levels
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10
Q

What are the sales objectives of the Hold strategy?

A
  • Maintain sales volume
  • Maintain distribution
  • Maintain service levels
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11
Q

What are the sales objectives of the Harvest strategy?

A
  • Reduce selling costs
  • Target profitable accounts
  • Reduce service costs and inventories
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12
Q

What are the sales objectives of the Divest strategy?

A

Clear inventory quickly

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13
Q

What are the sales strategies of the Build strategy?

A
  • High call rates on existing accounts
  • High focus during call
  • Call on new accounts (prospecting)
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14
Q

What are the sales strategies of the Hold strategy?

A
  • Continue present call rates on current accounts
  • Medium focus during call
  • Call on new outlets when they appear
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15
Q

What are the sales strategies of the Harvest strategy?

A
  • Call only on profitable accounts
  • Consider telemarketing or dropping the rest
  • No prospecting
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16
Q

What are the sales strategies of the Divest strategy?

A

Quantity discounts to targeted accounts

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17
Q

Porter’s Generic Business Strategies

A

A framework for achieving sustainable competitive advantage by positioning themselves strategically in the market

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18
Q

Advantages of Porter’s Generic Business Strategies

A
  • Product Oriented
  • Cost Oriented
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19
Q

Limitations of Porter’s Generic Business Strategies

A
  • May not suit every business or industry
  • Dynamic markets require hybrid approach
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20
Q

Name the strategies of Porter’s Generic Business Strategies

A
  • Cost Leadership Strategy
  • Differentiation Strategy
  • Focus Strategy (differentiation)
  • Focus Strategy (Low Cost)
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21
Q

Cost Leadership Strategy

A
  • Broad Target/Market Scope (Industry wide)
  • Advantage: Low Cost
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22
Q

Differentiation Strategy

A
  • Broad Target/Market Scope (Industry wide)
  • Advantage: Product/Service Uniqueness
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23
Q

Focus Strategy (Differentiation)

A
  • Narrow Target/Market Scope (Market Segment)
  • Advantage: Product/Service Uniqueness
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24
Q

Can a business strategy alone work?

A

NO - Each business strategy needs to be accompanied by a sales strategy

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25
Focus Strategy (Low Cost)
- Narrow Target/Market Scope (Market Segment) - Advantage: Low Cost
26
Ansoff Matrix
A strategic planning tool used to identify and evaluate growth opportunities
27
Name the strategies within the Ansoff Matrix
- Market Penetration Strategy - Product Development Strategy - Diversification Strategy - Market Development Strategy
28
Market Penetration Strategy
- Existing Product - Existing Market
29
Product Development Strategy
- New Product - Existing Market
30
Diversification Strategy
- New product - New Market
31
Market Development Strategy
- Existing Product - New Market
32
Sales objectives of **Market Penetration** Strategy
- Boost sales volume - Strengthen market share - Optimize distribution channels for improved product availability
33
Sales objectives of **Market Development** Strategy
- Expand geographically or into new segments - Build brand recognition - Develop relationships with new distributors/partners
34
Sales objectives of **Product Development** Strategy
- Increase revenue through cross-selling new offerings - Drive engagement - Leverage established distribution networks
35
Sales objectives of **Diversification** Strategy
- Establish Sales infrastructure and relationships in unfamiliar markets - Build early adoption through targeted campaigns/partnerships - Reduce dependency on current product catalog by spreading risk
36
Reason to “Hold” a product
Product is at a point where it reaches its “cap.”
37
BCG Matrix
a strategic tool used to evaluate a company’s product portfolio or business units based on their **market growth rate** and **relative market share.**
38
What is considered a relatively high market share?
+1%
39
Name the categories within the BCG Matrix
- Stars - Question Marks - Dogs - Cash Cow
40
Stars (BCG Matrix)
- High Market Growth Rate - High Relative Market Share
41
Question Marks (BCG Matrix)
- High Market Growth Rate - Low Relative Market Share
42
Dogs (BCG Matrix)
- Low Market Growth Rate - Low Relative Market Share
43
Cash Cows (BCG Matrix)
- Low Market Growth Rate - High Relative Market Share
44
What **Sales Strategy** is linked to Stars (BCG Matrix)?
Build / Hold
45
What **Sales Strategy** is linked to Question Marks (BCG Matrix)?
Build
46
What **Sales Strategy** is linked to Cash Cow (BCG Matrix)?
Hold / Harvest
47
What **Sales Strategy** is linked to Dogs (BCG Matrix)?
Divest
48
Tracy and Wiersema’s Value Strategy
A framework used to deliver exceptional value to customers and achieve competitive advantage
49
Name the strategies of Tracy & Wiersema’s Value Strategy
- Product Leadership - Operational Excellence - Customer Intimacy
50
Pareto principle (80/20 rule)
20% of customers account for 80% of a company’s revenue or profits
51
ABC Analysis
A business tool used to categorise customers based on their value or impact, following the **Pareto principle (80/20 rule)**
52
A Items within ABC Analysis
High value items / customers (20%)
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B Items within ABC Analysis
Moderate value items / customers (20-50%)
54
C Items within ABC Analysis
Low value items / customers (50-100%)
55
How much **% of a company’s revenue/profits** do **A items** account for?
80%
56
How much **% of a company’s revenue/profits** do **B items** account for?
15%
57
How much **% of a company’s revenue/profits** do **C items** account for?
5%
58
What are the steps to conduct an ABC Analysis?
- List all items / customers and their value - Rank them in descending order of value - Classify them into A, B or C categories based on contribution %
59
RFM model (ON EXAM 100%)
a marketing and customer segmentation tool that helps businesses evaluate and categorize customers based on their purchasing behavior
60
Name the components within the RFM model
- Recency - Frequency - Monetary
61
Recency (RFM model)
How recently a customer made a purchase
62
Frequency (RFM model)
How often a customer makes a purchases in a given period
63
Monetary (RFM model)
The total amount a customer spends over a period of
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