Marketing3321FinalReview

Marketing3321FinalReview - Advertising Personal Selling Hi...

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Advertising Personal Selling Hi Reach Low Reach Low Efficiency High Efficiency Less Information More Information Advertising vs Personal Selling Tradeoff Person Selling is more important if…. 1. Product has high value 2. Product is custom made 3. Product is technically complex 4. There are few customers 5. Customers are concentrated Advertising Sales Promotion are more important if… 1. Product has low value 2. Product is standardized 3. Product is simple understand 4. There are many customers 5. Customers are geographically dispersed Salesperson Performance = Ability x Motivation What leads to enhanced ability? 1. Recruiting 2. Training 3. Technology What leads to enhanced motivation? 1. Compensation 2. Corporate Culture Methods of Compensation 1. Salary 2. Commission 3. Best method = Mixed of the two Salary + Commission based. Salary 1. Security to Salesperson and loyalty to company 2. Can project compensation expenses Commission 1. Maximizes Incentives 2. Selling costs adjusts with sales Purpose of Compensation 1. Motivate Salesforce a. Align objectives b. Influence effort 2. Enhance hiring and retention 3. Provide feedback Traditional vs Relationship Selling 1. Relationship Selling = Long-term view of selling 2. Product Decisions Terminology
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1. Product Mix – All products offered by a company (ALL products from Apple) 2. Product Line – Group of closely related products (All MP3 players from Apple) 3. Product Item – A specific product within a product line (Ipod Nano 4GB) 1. Pros: a. Advertising Economies b. Packaging Uniformity c. Standardized Components d. Efficient Sales and Distribution e. Equivalent Quality Perception 2. Cons: a. 85/15 Rule b. Logistical Inefficiencies c. Increased Costs d. Confusion e. Too much choice Line Expansion/Contraction 1. Product Extension – adds products to an existing product line in order to compete more broadly in the industry 2. Product Contraction – removal of products because too much variety. For example when Steve Jobs took over Apple, Apple had over 40 products; he then made it so there are 2 laptops and 2 desktops. Since then Apple has grown immensely Brand Equity 1. The marketing and financial value associated with a brand’s strength in a market; the added value that a certain brand name gives to a product. Example: BMW to Cars and Sony to Comps 2. Why are brands valuable? They give you channel power and get higher margin from customers. Higher probability of success when you introduce new products by the same brand.
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Marketing3321FinalReview - Advertising Personal Selling Hi...

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