chapter 17

Question 1

direct marketing

Answer 1

the use of consumer-direct channels to reach and deliver goods and services to customers without using marketing middlemen.

Question 2

direct-order marketing

Answer 2

seeking measurable response, typically a customer order.

Question 3

market demassification

Answer 3

has resulted in an ever-increasing number of market niches.

Question 4

direct marketers’ decisions

Answer 4

1. objectives
2. target markets and prospects
3. offer elements
4. testing elements
5. measuring success: lifetime value

Question 5

direct-mail marketing

Answer 5

sending an offer, announcement, reminder, or other item to an individual consumer.

Question 6

offer strategy elements

Answer 6

1. the product
2. the offer
3. the medium
4. the distribution method
5. the creative strategy
   all these elements can be tested.

Question 7

components of the mailing

Answer 7

1. outside envelope
2. sales letter
3. circular
4. reply form
5. reply envelope
   often, direct mail is followed up by e-mail.

Question 8

catalogue marketing

Answer 8

companies may send full-line merchandise catalogues, specialty consumer catalogues, and business catalogues, usually in print form but also as DVDs or online.

Question 9

telemarketing

Answer 9

the use of phones and call centres to attract prospects, sell to existing customers, and provide service taking orders and answering questions.

Question 10

inbound telemarketing

Answer 10

receiving calls from customers.

Question 11

outbound telemarketing

Answer 11

initiating calls to prospects and customers.

Question 12

customer databases’ uses

Answer 12

can provide a source of competitive advantage.
1. identify prospects
2. decide which customers should receive a particular offer
3. deepen customer loyalty
4. reactivate customer purchases
5. avoid serious customer mistakes

Question 13

five main problems prevent effective use of database marketing

Answer 13

1. some situations are not conducive to database marketing
2. building and maintaining a customer database requires a large investment
3. employees may resist becoming customer-oriented and using the available information
4. not all customers want a relationship with the company
5. the assumptions behind CRM may not always hold true

Question 14

a customer database may not be worthwhile when

Answer 14

1. the product is a once-in-a-lifetime purchase
2. customers show little loyalty to a brand
3. the unit sale is very small so customer lifetime value is low
4. the cost of gathering information is too high
5. there is no direct contact between the seller and ultimate buyer

Question 15

sales representative positions (least to most creative types of selling)

Answer 15

1. deliverer
2. order taker (inside/outside)
3. missionary
4. technician
5. demand creator (relies on creative methods)
6. solution vendor

Question 16

missionary

Answer 16

a salesperson not permitted to take an order but expected to build goodwill or educate the actual or potential user.

Question 17

solution vendor

Answer 17

a salesperson whose expertise is solving a customer’s problem, often with a system of the company’s products or services.

Question 18

six major steps in effective selling

Answer 18

1. prospecting and qualifying
2. pre-approach
3. presentation and demonstration
4. overcoming objections
5. closing
6. follow-up and maintanence

Question 19

customers prefer suppliers who

Answer 19

1. sell and deliver a coordinated set of products and services to many locations
2. quickly solve problems in different locations
3. work closely with customer teams to improve products and processes

Question 20

direct sales force

Answer 20

consists of full- or part-time paid employees who work exclusively for the company.

Question 21

contractual sales force

Answer 21

consists of manufacturers’ reps, sales agents, and brokers who earn a commission based on sales.

Question 22

managing the sales force steps

Answer 22

1. recruiting and selecting sales representatives
2. training the representatives in sales techniques and in the company’s products, policies and customer-satisfaction
3. supervising the sales force and helping reps to use their time efficiently
4. motivating the sales force and balancing quotas, monetary rewards, and supplementary motivators
5. evaluating individual and group sales performance.

Question 23

designing a sales force

Answer 23

1. sales force objectives
2. sales force strategy
3. sales force structure
4. sales force size
5. sales force compensation

Question 24

types of sales force

Answer 24

1. strategic market sales force assigned to major accounts
2. a geographic sales force for customers in different territories
3. distributor sales force calling on and coaching distributors
4. an inside sales force marketing and taking orders online and via phone

Question 25

leveraged sales force

Answer 25

focuses reps on selling the company’s more complex and customized products to large accounts and uses inside salespeople and online ordering for low-end selling.

Question 26

workload approach

Answer 26

used to establish sales force size 1. group customers into size classes according to annual sales volume 2. establish desirable call frequencies for each class 3. multiply by the number of accounts in each size class by the corresponding call frequency to arrive at the total workload for the country, in sales calls per year 4. determine average number of calls a sales representative can make per year 5. divide the total annual calls required by the average annual calls made to arrive at the number of sales representatives needed

Question 27

inside salespeople

Answer 27

conduct business from the office and receive visits from prospective buyers.

Question 28

field salespeople

Answer 28

travel and visit customers.

Question 29

components of sales force compensation

Answer 29

1. fixed amount (salary) 2. variable amount (commissions, bonus, etc.) 3. expense allowances (meet costs of travel and entertaining on the company's behalf) 4. benefits (eg. paid vacations)

Question 30

fixed compensation

Answer 30

common in jobs with a high ratio of non-selling duties, when the selling task is technically complex and requires teamwork. it provides a secure income, encourage completing non-selling activities, and reduce incentive to overstock customers.

Question 31

variable compensation

Answer 31

works best if sales are cyclical or depend on individual initiative. it attracts high performers, provide more motivation, require less supervision, and control selling costs. however, it may emphasise getting the sale over building the relationship.

Question 32

time-and-duty analysis and hour by hour breakdown of activities

Answer 32

help sales reps to understand how they spend their time and how they might increase their productivity.

Question 33

feed-forward aspects of sales supervision

Answer 33

how management communicates what the sales reps should be doing and motivates them to do it. it requires good feedback, which means evaluating their performance.

Question 34

information about reps

Answer 34

1. sales reports 2. personal observation 3. self-reports 4. customer letters and complaints 5. customer surveys 6. conversations with other reps

Question 35

annual territory-marketing plan

Answer 35

sales reps outline their program for developing new accounts and increasing business from existing accounts.

Question 36

call reports

Answer 36

sales reps write up completed activities.

Question 37

key indicators of sales performance extracted from reports

Answer 37

1. average number of sales calls per person per day 2. average sales call time per contact 3. average revenue per sales call 4. average cost per sales call 5. entertainment cost per sales call 6. percentage of orders per hundred sales calls 7. number of new customers per period 8. number of lost customers per period 9. sales force costs as a percentage of total sales