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PMk Final Exam SAQS - Short answer questions in PMk

Principle of Marketing (Đại học Western Sydney)

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Chapter 1: Marketing: Creating Customer Value and engagement.

I) Marketing process

II) Needs, wants, demands.

Needs:States of felt deprivation.
Wants: The form human needs take as they are shaped by culture and individual personality.
Demands: Human wants that are backed by buying power.

III) Five alternatives concept under which organization design and

carry out their business
1. Production concept: The idea that consumers will favor products that are available and highly
affordable; therefore, the organization should focus on improving production and distribution
efficiency.
2. Product concept: The idea that consumers will favor products that offer the most quality,
performance, and features; therefore, the organization should devote its energy to making
continuous product improvements.
3. Selling concept: The idea that consumers will not buy enough of the firm’s products unless the
firm undertakes a large-scale selling and promotion effort.
4. Marketing concept: A philosophy in which achieving organizational goals depends on
knowing the needs and wants of target markets and delivering the desired satisfactions better
than competitors do.

5. Societal marketing concept: The idea that a company’s marketing decisions should consider
consumers’ wants, the company’s requirements, consumers’ long-run interests, and society’s
long-run interests.

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IV) Building the Right Relationships with the Right Customers

Strangers show low potential profitability and little projected loyalty. There is little fit between
the company’s offerings and their needs.
Butterflies are potentially profitable but not loyal. There is a good fit between the company’s
offerings and their needs.
True friends are both profitable and loyal. There is a strong fit between their needs and the
company’s offerings. It wants to turn true friends into true believers, who come back regularly
and tell others about their good experi- ences with the company.
Barnacles are highly loyal but not very profitable. There is a limited fit between their needs and
the company’s offerings
The goal is to build the right relation- ships with the right customers.

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Chapter 2: Company and Marketing Strategy: partnering to Build

Customer engagement, Value, and relationships.
I) Step in strategic planning

Mission statement: A statement of the organization’s purpose—what it wants to accomplish in

the larger environment.
Marketing strategies and programs must be developed to support these marketing objectives.
Business objectives are the results you are aiming to achieve in order to accomplish your longer-
term company vision
Analyze its current business portfolio and determine which businesses should receive more, less,
or no investment.
SBUs: An SBU can be a company division, a product line within a division, or sometimes a
single product or brand.
Shape the future portfolio by developing strategies for growth and downsizing.

II) BCG Growth-share matrix

1. Stars. Stars are high-growth, high-share businesses or products. They often need heavy
investments to finance their rapid growth. Eventually their growth will slow down, and they will
turn into cash cows.
2. Cash cows. Cash cows are low-growth, high-share businesses or products. These established
and successful SBUs need less investment to hold their market share. Thus, they produce a lot of
the cash that the company uses to pay its bills and support other SBUs that need investment.
3. Question marks. Question marks are low-share business units in high-growth markets. They
require a lot of cash to hold their share, let alone increase it. Management has to think hard about
which question marks it should try to build into stars and which should be phased out.

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4. Dogs. Dogs are low-growth, low-share businesses and products. They may generate enough
cash to maintain themselves but do not promise to be large sources of cash.

III) One useful device for identifying growth opportunities is the

production expansion grid

IV) SWOT analysis

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Chapter 3: Analyzing the Marketing environment.

I) Microenvironment

1. Supplier: They provide the resources needed by the company to produce its goods and
services.
2. Marketing intermediaries: Firms that help the company to promote, sell, and distribute its
goods to final buyers.
3. Public: Any group that has an actual or potential interest in or impact on an
organization’s ability to achieve its objectives. Seven types: Financial, Media,
Government, Citizen-action, Internal, General, Local
4. Customer: The aim of the entire value delivery network is to engage target customers and
create strong relationships with them. The company might target any or all of five types
of customer markets.
a. Consumer markets consist of individuals and households that buy goods and
services for personal consumption.
b. Business markets buy goods and services for further processing or use in their
production processes
c. Reseller markets buy goods and services to resell at a profit.
d. Government markets consist of government agencies that buy goods and services
to produce public services or transfer the goods and services to others who need
them.
e. International markets consist of these buyers in other countries, including
consum- ers, producers, resellers, and governments.

II) Macroenvironment

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1. Demography: The study of human populations in terms of size, density, location, age,
gender, race, occupation, and other statistics. Baby boomers (1946-1964), generation X
(1965-1976), Generation Y/Millennials (1977-2000), generation Z (after 2000)
2. Economic environment: Economic factors that affect consumer purchasing power and
spending patterns.
3. Natural environment: The physical environment and the natural resources that are needed
as inputs by marketers or that are affected by marketing activities.
4. Technological environment: Forces that create new technologies, creating new product
and market opportunities.
5. Political environment: Laws, government agencies, and pressure groups that influence
and limit various organizations and individuals in a given society.
6. Cultural environment: Institutions and other forces that affect society’s basic values,
perceptions, preferences, and behaviors.

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Chapter 5: Consumer Markets and Buyer Behavior.

I) Factors influencing consumer behavior

Cultural:
- Culture: The set of basic values, perceptions, wants, and behaviors learned by a member
of society from family and other important institutions
- Subculture: A group of people with shared value systems based on common life
experiences and situations.
- Social class: Relatively permanent and ordered divisions in a society whose members
share similar values, interests, and behaviors. upper upper class, lower upper class, upper
middle class, middle class, working class, upper lower class, and lower lower class.
Social:
- Group: Two or more people who interact to accomplish individual or mutual goals
- Role consists of the activities people are expected to perform according to the people
around them.
Personal:
- Lifestyle: A person’s pattern of living as expressed in his or her activities, interests, and
opinions.
- Personality: The unique psychological characteristics that distinguish a person or group
Psychological
- Motive (drive): A need that is sufficiently pressing to direct the person to seek
satisfaction of the need.
- Perception: The process by which people select, organize, and interpret information to
form a meaningful picture of the world.
- Learning: Changes in an individual’s behavior arising from experience.
- Belief: A descriptive thought that a person holds about something.
- Attitude: A person’s consistently favorable or unfavorable evaluations, feelings, and
tendencies toward an object or idea

II) Four types of buying behavior

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1. Complex buying behavior: Consumer buying behavior in situations characterized by high

consumer involvement in a purchase and significant perceived differences among brands.
2. Dissonance-reducing buying behavior: Consumer buying behavior in situations
characterized by high involvement but few perceived differences among brands.
3. Habitual buying behavior: Consumer buying behavior in situations characterized by low
consumer involvement and few significant perceived brand differences.
4. Variety-seeking buying behavior: Consumer buying behavior in situations characterized
by low consumer involvement but significant perceived brand differences.

III) The buyer decision process

1. Need recognition: The first stage of the buyer decision process, in which the consumer
recognizes a problem or need.
2. Information search: The stage of the buyer decision process in which the consumer is
motivated to search for more information.
3. Alternative evaluation: The stage of the buyer decision process in which the consumer
uses information to evaluate alternative brands in the choice set.
4. Purchase decision: The buyer’s decision about which brand to purchase
5. Postpurchase behavior: The stage of the buyer decision process in which consumers take
further action after purchase, based on their satisfaction or dissatisfaction.

IV) Stages in adoption process

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1. Awareness. The consumer becomes aware of the new product but lacks information about
it.
2. Interest. The consumer seeks information about the new product.
3. Evaluation. The consumer considers whether trying the new product makes sense.
4. Trial. The consumer tries the new product on a small scale to improve his or her estimate
of its value.
5. Adoption. The consumer decides to make full and regular use of the new product.

V) Customer adoption curve

1. Innovators are venturesome—they try new ideas at some risk.

2. Early adopters are guided by respect—they are opinion leaders in their communities and
adopt new ideas early but carefully.
3. Early mainstream adopters are deliberate—although they rarely are leaders, they adopt
new ideas before the average person.
4. Late mainstream adopters are skeptical—they adopt an innovation only after a majority
of people have tried it.
5. Lagging adopters are tradition bound—they are suspicious of changes and adopt the
innovation only when it has become something of a tradition itself

VI) Characteristics influence the rate of adoption

1. Relative advantage. The degree to which the innovation appears superior to existing
products.
2. Compatibility. The degree to which the innovation fits the values and experiences of
potential consumers.
3. Complexity. The degree to which the innovation is difficult to understand or use
4. Divisibility. The degree to which the innovation may be tried on a limited basis.
5. Communicability. The degree to which the results of using the innovation can be
observed or described to others.

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Chapter 7: Customer Value–Driven Marketing Strategy: Creating

Value for target Customers.
I) Designing a Customer-Driven Marketing Strategy

II) Market segmentation

1. Geographic segmentation: Dividing a market into different geographical units, such as
nations, states, regions, counties, cities, or even neighborhoods.
2. Demographic segmentation; Dividing the market into segments based on variables such
as age, life-cycle stage, gender, income, occupation, education, religion, ethnicity, and
generation.
3. Psychographic segmentation: Dividing a market into different segments based on lifestyle
or personality characteristics
4. Behavioral segmentation: Dividing a market into segments based on consumer
knowledge, attitudes, uses of a product, or responses to a product.

III) Requirements for effective segmentation

1. Measurable. The size, purchasing power, and profiles of the segments can be measured.
2. Accessible. The market segments can be effectively reached and served.
3. Substantial. The market segments are large or profitable enough to serve.
4. Differentiable. The segments are conceptually distinguishable and respond differently to
different marketing mix elements and programs.
5. Actionable. Effective programs can be designed for attracting and serving the segments.

IV) Four types of targeting strategies in marketing

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1. Undifferentiated (mass) marketing: A market-coverage strategy in which a firm decides

to ignore market segment differences and go after the whole market with one offer.
2. Differentiated (segmented) marketing: A market-coverage strategy in which a firm
targets several market segments and designs separate offers for each.
3. Concentrated (niche) marketing: A market-coverage strategy in which a firm goes after a
large share of one or a few segments or niches.
4. Micromarketing: Tailoring products and marketing programs to the needs and wants of
specific individuals and local customer segments; it includes local marketing and
individual marketing.

V) Differentiation and Positioning

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Chapter 8: Products, Services, and Brands: Building Customer Value.

I) Levels of Product and Services

The most basic level is the core customer value, which addresses the question: What is the buyer really buying?
At the second level, product plan- ners must turn the core benefit into an actual product. They need to develop
product and service features, a design, a quality level, a brand name, and packaging.
Finally, product planners must build an augmented product around the core benefit and actual product by offering
additional consumer services and benefits.

II) Three levels of product and services decisions

1) Individual product decision

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Stage 1: product and service attributes (thuộc tính)

Product quality: the characteristics of a product or service that bear on its ability to satisfy
stated or implied customer needs.
¥ Total quality management (TQM): is an approach where the whole company is
involved in constantly improving the overall quality.
¥ Performance quality: hiệu suất
¥ Conformance quality: độ nhất quán
Product feature: competitive tool for differentiating
Product style and design:
¥ Design is a larger concept than style. Style simply describes the appearance of a product.
¥ Design is more than skin deep—it goes to the very heart of a product.
Stage 2: branding
A brand is a name, term, sign, symbol, design or a combination of these that identifies the
products or services of one seller or group of sellers and differentiates them from those of
competitors.
Stage 3: Packaging
Involves the activities of designing and producing the container or wrapper for a product
Protect the product, attract buyers, communicate brand positioning, close the sales,
environmental concern
Innovative packaging can give a competitive advantage.
Stage 4: Labeling and logos
It help identifying a product or brand
Describe product (origin, date of production, content, instruction) and engage customers
Law/labeling requirement
Stage 5: Support product service
By using phone, email, online, social media, mobile, and interactive voice and data technologies
to provide support services that were not possible before

2) Product line decisions

Product line: A group of products that are closely related because they function in a similar
manner, are sold to the same customer groups, are marketed through the same types of outlets, or
fall within given price ranges.
Product line length—the number of items in the product line.
A company can expand its product line in two ways:
¥ Product line filling involves adding more items within the present range of the line.
¥ Product line stretching occurs when a company lengthens its product line beyond its
current range.

3) Product mix decisions

Product mix (or product portfolio) The set of all product lines and items that a particular seller
offers for sale.
¥ Product mix width refers to the number of different product lines the company carries.
¥ Product mix length refers to the total number of items a company carries within its
product lines.
¥ Product line depth refers to the number of versions offered of each product in the line.

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¥ The consistency of the product mix refers to how closely related the various product lines
are in end use, production requirements, distribution channels, or some other way.

III) The Nature and Characteristics of a Service

IV) Three types of services marketing

External marketing is the traditional type of marketing where companies create promotions and
materials to help sell their services.
Internal marketing: Orienting and motivating customer- contact employees and supporting
service employees to work as a team to provide customer satisfaction.
Interactive marketing: Training service employees in the fine art of interacting with customers
to satisfy their needs.

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V) Brand equity + Brand value = A strong brand

Brand equity: The differential effect that knowing the brand name has on customer response to
the product or its marketing.
Brand value: The total financial value of a brand.

VI) Building Strong Brands

VII) Brand Development Strategies

Line extension: Extending an existing brand name to new forms, colors, sizes, ingredients, or
flavors of an existing product category.
Brand extension: Extending an existing brand name to new product categories.
New Brands: A company might believe that the power of its existing brand name is waning, so a
new brand name is needed.
Multibrands: Companies often market many different brands in a given product category.

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Chapter 9: Developing New products and Managing the product Life

Cycle.
I) Product development process

S1: Idea generation: The systematic search for new product ideas.
S2: Idea screening: Screening new product ideas to spot good ones and drop poor ones as soon as
possible.
S3: Concept testing: Testing new product concepts with a group of target consumers to find out
if the concepts have strong consumer appeal.
- Product concept: A detailed version of the new product idea stated in meaningful
consumer terms.
- product idea is an idea for a possible product that the company can see itself offering to
the market.
- product image is the way consumers perceive an actual or potential product.
S4: Marketing strategy development: Designing an initial marketing strategy for a new product
based on the product concept.
S5: Business analysis: A review of the sales, costs, and profit projections for a new product to
find out whether these factors satisfy the company’s objectives.
S6: Product development: Developing the product concept into a physical product to ensure that
the product idea can be turned into a workable market offering.
S7: Test marketing: The stage of new product development in which the product and its
proposed marketing program are tested in realistic market settings.
S8: Commercialization: Introducing a new product into the market.

II) Product-life cycle

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1. Product development begins when the company finds and develops a new product idea.
During product development, sales are zero, and the company’s investment costs mount.
2. Introduction is aperiod of slow sales grow that the product is introduced in the market.
Profits are nonexistent in this stage because of the heavy expenses of product
introduction.
3. Growth is a period of rapid market acceptance and increasing profits.
4. Maturity is a period of slowdown in sales growth because the product has achieved
acceptance by most potential buyers. Profits level off or decline because of increased
marketing outlays to defend the product against competition.
5. Decline is the period when sales fall off and profits drop.

III) Key characteristics of each stage of the PLC.

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Chapter 10: Pricing: Understanding and Capturing Customer Value.

I) 3 major pricing strategies
1. Customer value based pricing
Customer value–based pricing: Setting price based on buyers’ perceptions of value rather than on
the seller’s cost.

A. Good-Value Pricing: Offering just the right combination of quality and good service
at a fair price.
¥ Everyday low pricing (EDLP) involves charging a constant, everyday low price
with few or no temporary price discounts.
¥ High-low pricing involves charging higher prices on an everyday basis but
running frequent promotions to lower prices temporarily on selected items.
B. Value-added pricing: Attaching value-added features and services to differentiate a
company’s offers and charging higher prices.

2. Cost based pricing

Cost-based pricing Setting prices based on the costs of producing, distributing, and selling the
product plus a fair rate of return for effort and risk.
Fixed costs (overhead): Costs that do not vary with production or sales level.
Variable costs: Costs that vary directly with the level of production.
Total costs: The sum of the fixed and variable costs for any given level of production.
A. Costs at Different Levels of Production

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B. Costs as a Function of Production Experience

Experience curve (learning curve): The drop in the average per-unit production cost that comes
with accumulated production experience.
C. Cost-Plus Pricing
Cost-plus pricing (markup pricing): Adding a standard markup to the cost of the product.

D. Break-Even Analysis and Target Profit Pricing

Break-even pricing (target return pricing: Setting price to break even on the costs of making and
marketing a product or setting price to make a target return.

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3. Competition-based pricing
Competition-based pricing: Setting prices based on competitors’ strategies, prices, costs, and
market offerings.

II) Methods to analyze the price-demand relationship

1. Pricing in Different Types of Markets

2. Analyzing the price-demand relationship

Demand curve: A curve that shows the number of units the market will buy in a given time
period, at different prices that might be charged.

In the normal case, demand and price are inversely related—that is, the higher the price, the
lower the demand.
3. Price elasticity of demand
Price elasticity: A measure of the sensitivity of demand to changes in price.
If demand is elastic rather than inelastic, sellers will consider lowering their prices. A lower price
will produce more total revenue.

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Chapter 11: Pricing Strategies: additional Considerations.

I) New product pricing strategies
Market skimming strategies: Setting a high price for a new product to skim maximum revenues
layer by layer from the segments willing to pay the high price; the company makes fewer but
more profitable sales.
Market skimming makes sense only under certain conditions:
¥ (1) The product’s quality and image must support its higher price, and
¥ (2) Enough buyers must want the product at that price.
¥ (3) Competitors should not be able to enter the market easily and undercut the high price.
Market-penetration pricing: Setting a low price for a new product in order to attract a large
number of buyers and a large market share.
Several conditions must be met for this low-price strategy to work:
¥ (1) The market must be highly price sensitive so that a low price produces more market
growth.
¥ (2) Production and distribution costs must decrease as sales volume increases.
¥ (3) The low price must help keep out the competition, and the penetration price must
maintain its low-price position.

II) Product mix pricing strategies

III) Pricing adjustment strategies

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Discount and Allowance Pricing

Discount: A straight reduction in price on purchases during a stated period of time or of larger
quantities.
cash discount, a price reduction to buyers who pay their bills promptly
¥ Quantity discount is a price reduction to buyers who buy large volumes.
¥ Functional discount (also called a trade discount) to trade-channel members who
perform certain functions, such as selling, storing, and record keeping.
¥ A seasonal discount is a price reduction to buyers who buy merchandise or services out
of season.
Allowance: Promotional money paid by manufacturers to retailers in return for an agreement to
feature the manufacturer’s products in some way
¥ Trade-in allowances are price reductions given for turning in an old item when buying a
new one.
¥ Promotional allowances (trợ cấp khuyến mãi) are payments or price reductions that
reward dealers for participating in advertising and sales-support programs.

Segmented Pricing
Segmented pricing: Selling a product or service at two or more prices, where the difference in
prices is not based on differences in costs.
¥ Customer-segment pricing, different customers pay different prices
¥ Product form pricing, different versions of the product are priced differently but not
according to differences in their costs.
¥ Location-based pricing, a company charges different prices for different locations, even
though the cost of offering each location is the same.
¥ Time-based pricing, a firm varies its price by the season, the month, the day, and even
the hour.

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Psychological Pricing
Psychological pricing: Pricing that considers the psychology of prices and not simply the
economics; the price is used to say something about the product.
¥ Reference prices (Giá ấn định của mỗi người): Prices that buyers carry in their minds
and refer to when they look at a given product.
¥ Odd-even pricing: occurs when company prices a product a few center of a few dollars
below the next dollar amount

Promotional Pricing
Promotional pricing: Temporarily pricing products below the list price, and sometimes even
below cost, to increase short-run sales.
¥ Limited-time offers, such as online flash sales, can create buying urgency and make
buyers feel lucky to have gotten in on the deal.
¥ Cash rebates to consumers who buy the product from dealers within a specified time; the
manufacturer sends the rebate directly to the customer

Geographical Pricing
Geographical pricing: Setting prices for customers located in different parts of the country or
world.
¥ FOB-origin pricing (giá phụ thuộc vào điểm giao hàng, buyer trả toàn bộ phí): Pricing in
which goods are placed free on board a carrier; the customer pays the freight from the
factory to the destination.
¥ Uniform-delivered pricing (opposite of FOB pricing ) (Tính cùng một mức giá): Pricing
in which the company charges the same price plus freight to all customers, regardless of
their location.
¥ Zone pricing (set giá theo khu vực, những người trong khu vực đó đều hưởng mức giá
giống nhau): Pricing in which the company sets up two or more zones. All customers
within a zone pay the same total price; the more distant the zone, the higher the price.
¥ Basing-point pricing (Một số thành phố sẽ được đặt cơ sở, và giá sẽ tính từ địa điểm đó
tới nhà mình): Pricing in which the seller designates some city as a basing point and
charges all customers the freight cost from that city to the customer. If all sellers used the
same basing-point city, delivered prices would be the same for all customers, and price
competition would be eliminated.
¥ Freight-absorption pricing (Seller chịu toàn bộ phí vận chuyển): Pricing in which the
seller absorbs all or part of the freight charges in order to get the desired business.

Dynamic and Online Pricing

Dynamic pricing: Adjusting prices continually to meet the characteristics and needs of
individual customers and situations

International Pricing
Companies that market their products internationally must decide what prices to charge in
different countries

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IV) Public policy and pricing

Pricing within Channel Levels

Federal legislation on price-fixing states that sellers must set prices without talking to
competitors
Sellers are also prohibited from using predatory pricing (Phá giá)—selling below cost with the
intention of punishing a competitor or gaining higher long-run profits by putting competitors out
of business.

Pricing across Channel Levels

The Robinson-Patman Act seeks to prevent unfair price discrimination by ensuring that sellers
offer the same price terms to customers at a given level of trade.
price discrimination is allowed if the seller can prove that its costs are different when selling to
different retailers
Laws also prohibit retail (or resale) price maintenance—a manufacturer cannot require dealers
to charge a specified retail price for its product.
Deceptive pricing occurs when a seller states prices or price savings that mislead consumers or
are not actually available to consumers.

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Chapter 12 Marketing Channels: Delivering Customer Value.

I) Consumer and Business Marketing Channels

II) Vertical Marketing Systems

Vertical marketing system (VMS): A channel structure in which producers, wholesalers, and
retailers act as a unified system. One channel member owns the others, has contracts with them,
or has so much power that they all cooperate.
¥ Corporate VMS: A vertical marketing system that combines successive stages of
production and distribution under single ownership—channel leadership is established
through common ownership.
o Franchise organization: A contractual vertical marketing system in which a
channel member, called a franchisor, links several stages in the production-
distribution process. Include manufacturer-sponsored retailer franchise system,
manufacturer-sponsored wholesaler franchise system, service-firm-sponsored
retailer franchise system
¥ Contractual VMS: A vertical marketing system in which independent firms at different
levels of production and distribution join together through contracts.
¥ Administered VMS: A vertical marketing system that coordinates successive stages of
production and distribution through the size and power of one of the parties.

III) Horizontal Marketing System

Horizontal marketing system: A channel arrangement in which two or more companies at one
level join together to follow a new marketing opportunity. By working together, companies can
combine their financial, production, or marketing resources to accomplish more than any one
company could alone.

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IV) Multichannel distribution system

Multichannel distribution system: A distribution system in which a single firm sets up two or more marketing channels to reach
one or more customer segments.

V) Reasons to emphasize on logistics

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Chapter 14 Engaging Consumers and Communicating Customer Value:

Integrated Marketing CommunicationStrategy.
I) Integrated Marketing Communications
Integrated marketing communications (IMC: Carefully integrating and coordinating the
company’s many communications channels to deliver a clear, consistent, and compelling
message about the organization and its products.
Promotion tools + 3C message: Clear, Consistence, Compelling = IMC (Integrated marketing
communication)

II) Step in developing effective marketing communication

1. Design the message (AIDA model)

Having defined the desired audience response, the communicator then turns to developing an
effective message. Ideally, the message should get attention, hold interest, arouse desire, and
obtain action

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III) Push versus Pull Promotion Strategy

Push strategy: A promotion strategy that calls for using the sales force and trade promotion to
push the product through channels.
The producer promotes the product to channel members who in turn promote it to final
consumers.
Pull strategy: A promotion strategy that calls for spending a lot on consumer advertising and
promotion to induce final consumers to buy the product, creating a demand vacuum that “pulls”
the product through the channel.

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Chapter 15: Advertising and public relations.

I) Major Advertising Decisions

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II) Major public relation tools

Public relations (pr): Building good relations with the company’s various publics by obtaining
favorable publicity; building up a good corporate image; and handling or heading off
unfavorable rumors, stories, and events

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Chapter 16: Personal Selling and Sales promotion.

I) Designing the Sales Force Strategy and Structure
1. The Sales Force Structure
¥ Territorial sales force structure: A sales force organization that assigns each salesperson
to an exclusive geographic territory in which that salesperson sells the company’s full
line.
¥ Product sales force structure: A sales force organization in which salespeople specialize
in selling only a portion of the company’s products or lines.
¥ Customer (or market) sales force structure: A sales force organization in which
salespeople specialize in selling only to certain customers or industries.

2. Sales Force Size

Once the company has set its structure, it is ready to consider sales force size. Sales forces may
range in size from only a few salespeople to tens of thousands.
A company might use some form of workload approach to set sales force size. Using this
approach, a company first groups accounts into different classes according to size, account
status, or other factors related to the amount of effort required to maintain the account.

3. Other Sales Force Strategy and Structure Issues

¥ Outside sales force (or field sales force: Salespeople who travel to call on customers in
the field.
¥ Inside sales force: Salespeople who conduct business from their offices via telephone,
online and social media interactions, or visits from prospective buyers.
¥ Team selling: Using teams of people from sales, marketing, engineering, finance,
technical support, and even upper management to service large, complex accounts.

II) Steps in the Selling Process

1. Prospecting and Qualifying

Prospecting: The sales step in which a salesperson or company identifies qualified potential
customers.

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2. Preapproach
Preapproach: The sales step in which a salesperson learns as much as possible about a
prospective customer before making a sales call.

3. Approach
Approach: The sales step in which a salesperson meets the customer for the first time.

4. Presentation and demonstration

Presentation: The sales step in which a salesperson tells the “value story” to the buyer, showing
how the company’s offer solves the customer’s problems.

5. Handling objections
Handling objections: The sales step in which a salesperson seeks out, clarifies, and overcomes
any customer objections to buying.

6. Closing
Closing: The sales step in which a salesperson asks the customer for an order.

7. Follow-up
Follow-up: The sales step in which a salesperson follows up after the sale to ensure customer
satisfaction and repeat business.

III) Major Sales Promotion Tools

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IV) Developing the Sales Promotion Program

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Chapter 17: Direct, Online, Social Media, and Mobile Marketing

I) Forms of Direct and Digital Marketing

1. Social Media and Mobile Marketing

Digital and social media marketing is the fastest-growing form of direct marketing.
Digital and social media marketing: Using digital marketing tools such as websites, social media,
mobile apps and ads, online video, email, and blogs that engage consumers anywhere, anytime
via their digital devices.
Omni-channel retailing: Creating a seamless cross-channel buying experience that integrates in-
store, online, and mobile shopping
¥ Online marketing: Marketing via the internet using company websites, online ads and
promotions, email, online video, and blogs.
¥ Social media: Independent and commercial online social networks where people
congregate to socialize and share messages, opinions, pictures, videos, and other content
¥ Mobile marketing: Marketing messages, promotions, and other content delivered to on-
the-go consumers through their mobile devices.

2. Traditional Direct Marketing Forms

¥ Direct-mail marketing: Marketing that occurs by sending an offer, announcement,
reminder, or other item directly to a person at a particular address.
¥ Catalog marketing: Direct marketing through print, video, or digital catalogs that are
mailed to select customers, made available in stores, or presented online.
¥ Telemarketing: Using the telephone to sell directly to customers.
¥ Direct-response television (DRTV) marketing: Direct marketing via television, including
direct-response television advertising (or infomercials) and interactive television (iTV)
advertising.
¥ Kiosks marketing: As consumers become more and more comfortable with digital and
touchscreen technolo- gies, many companies are placing information and ordering
machines

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