You are on page 1of 27

Unit-2 Sales Strategies and Sales Promotion

Program Semester Subject Code Subject Name

: MBA :I : MK 0010 : Sales, Distribution and Supply Chain Management

Unit number
Unit Title Lecture Number

:2
: Sales Strategies and Sales Promotion :1

1
PREVIOUS HOME
CNEXT onfidential

Unit-2 Sales Strategies and Sales Promotion

Sales Strategies and Sales Promotion


Objective Explain the concept of sales strategy formulation

Define sales forecasting and various type of forecasting techniques


Explain the purpose of sales budget

2
PREVIOUS HOME
CNEXT onfidential

Unit-2 Sales Strategies and Sales Promotion

Lecture Outline

LECTURE 1 Introduction

Formulation of Sales Strategy


Types of Sales Strategies Sales Forecasting Sales Budget LECTURE 2

Sales Quotas Sales Territory

Sales Display
Sales Promotion

3
PREVIOUS HOME
CNEXT onfidential

Unit-2 Sales Strategies and Sales Promotion

INTRODUCTION
The sales organization is the initiator as well as the implementer of dealer support operations. Dealer-sales organization relationship often becomes the key to successful working operations within the organization.

4
PREVIOUS HOME
CNEXT onfidential

Unit-2 Sales Strategies and Sales Promotion

Formulation of Sales Strategy


Strategy formulation in case of sales would involve identification of the sales goals and designing of a game plan, using the organizational resources at hand, to achieve those goals. The strategy formulation process can be shown as

5
PREVIOUS HOME
CNEXT onfidential

Unit-2 Sales Strategies and Sales Promotion

Types of Sales Strategies


The various types of sales strategies are discussed below: Relationship strategy Establishing and maintaining a partnership-type relationship internally as well as with the customers is a vital aspect of selling. Double-win strategy In this strategy, both the customer and the salesperson come out of the sale with a sense of satisfaction. Thus the stage for a long-term relationship, repeat business and future referrals.

6
PREVIOUS HOME
CNEXT onfidential

Unit-2 Sales Strategies and Sales Promotion

Types of Sales Strategies


Instant service One cannot survive in a highly competitive market without conforming to the so called Q-C-D triangle Highest Quality, Lowest Cost and Least Delivery times Hard sell vs. soft sell strategy Identifying potential customers is an important aspect of customer strategy

Strategies for Identifying Customers


Hard Sell Concern for self Canned presentation Talking Pushing product
Presenting features Advocating without acknowledge
7
PREVIOUS HOME
CNEXT onfidential

Soft Sell Concern for customer Questions for discussion Listening Providing buying opportunities
Presenting benefits Acknowledging needs

Unit-2 Sales Strategies and Sales Promotion

Types of Sales Strategies

Integrated sales strategies Integrated sales strategies integration is required between sales and distribution functions Client-centered selling strategy This focuses the entire selling process and efforts on the clients needs, problems and successes.

8
PREVIOUS HOME
CNEXT onfidential

Unit-2 Sales Strategies and Sales Promotion

Sales Forecasting
Sales Forecasting is an estimate of sales during a specified future period which is tied to a proposed marketing plan and which assumes a particular set of uncontrollable and competitive forces.

The various methods of sales forecasting are: Survey method: Based on the opinion of buyers and consumers Expert opinion: Opinions of executives and consultants are used to forecast future sales. Market studies method Market experiments are conducted on changing consumer behaviour,

prices, advertising expenditure, etc.


Sales force opinion method: It estimates the buyer's intentions from experienced personnel in the sales force.
9
PREVIOUS HOME
CNEXT onfidential

Unit-2 Sales Strategies and Sales Promotion

Sales Forecasting
Statistical methods They are considered to be superior techniques of sales forecasting because of higher reliability.

Commonly used statistical methods are: Trend method

Graphical method
Time series method Regression analysis

10
PREVIOUS HOME
CNEXT onfidential

Unit-2 Sales Strategies and Sales Promotion

Sales Budget
A sales budget is a financial plan depicting how resources should best be allocated to achieve the forecasted sales.

11
PREVIOUS HOME
CNEXT onfidential

Unit-2 Sales Strategies and Sales Promotion

THANK YOU

12
PREVIOUS HOME
CNEXT onfidential

12

Unit-2 Sales Strategies and Sales Promotion

Program Semester Subject Code Subject Name

: MBA :I : MK 0010 : Sales, Distribution and Supply Chain Management

Unit number
Unit Title Lecture Number

:2
: Sales Strategies and Sales Promotion :2

13
PREVIOUS HOME
CNEXT onfidential

13

Unit-2 Sales Strategies and Sales Promotion

Sales Strategies and Sales Promotion


Objective Explain the importance of sales quotas

Discuss the concept of sales territories


Explain sales display concept Describe execution of sales display and its execution Explain the meaning of sales promotion and various tools of sales promotion

14
PREVIOUS HOME
CNEXT onfidential

14

Unit-2 Sales Strategies and Sales Promotion

Sales Quotas
A sales quota refers to an expected routine assignment to sales units, such as territory, districts and branches, etc. Sales quotas are also assigned to individual salespeople over a particular time period and are used to plan, control and evaluate the selling activities of a company. Types of sales quotas Sales volume quotas Sales volume quotas include sales in rupees or product unit objectives for a specific period of time. Profit quotas Profit quotas are particularly useful in multi product companies where

different products contribute to varying levels of profits

15
PREVIOUS HOME
CNEXT onfidential

Unit-2 Sales Strategies and Sales Promotion

Sales Quotas
Expense quotas Expense quotas are related to selling costs within reasonable limits. Some companies set quotas for expenses linked to different levels of sales attained by their sales force Activity quotas

16
PREVIOUS HOME
CNEXT onfidential

Unit-2 Sales Strategies and Sales Promotion

Sales Territory
A sales territory comprises of a group of customers or a geographical area assigned to a sales unit. The territory may or may not have geographic boundaries. A company can develop and use sales territories for various reasons. Some of the reasons are: Obtain entire coverage of the market

Establish a salespersons responsibility


Evaluate performance Improve customer relations Reduce sales expenses Allow better matching of salesperson to customer

17
PREVIOUS HOME
CNEXT onfidential

Unit-2 Sales Strategies and Sales Promotion

Sales Display
arranging systematically saleable goods so as to attract the attention of the customer Through a sales display, the manufacturer shows the goods or services to the customer.

18
PREVIOUS HOME
CNEXT onfidential

Unit-2 Sales Strategies and Sales Promotion

Sales Promotion
Sales promotion serves three essential roles: it informs, persuades and reminds prospective customers about a company and its products Sales promotions are short term incentives provided by the company to boost sales. Sales promotion includes several communications activities that attempt to provide added value or incentives to consumers, wholesalers, retailers, or other organizational customers to stimulate immediate sales. Sales promotion devices can include premiums, coupons, contests temporary price reduction, free goods, letter to traders, literature,

educational, mental displays and trade shows.

19
PREVIOUS HOME
CNEXT onfidential

Unit-2 Sales Strategies and Sales Promotion

Objectives of sales promotion


Encourage dealers to participate in display and sales contests Gain advantageous shelf-space Increase store traffic Improve relationship with dealers Block competitors moves Motivate sales force Supplement advertising and personal selling efforts Deflect customers attention from price

Increase sales volume Speed up the sales for slow

moving products
Check the fluctuations in sales Attract new customers Launch new product(s) and

increase trial
Encourage repeat purchase Clearance inventories of excessive

Motivate dealers

20
PREVIOUS HOME
CNEXT onfidential

Unit-2 Sales Strategies and Sales Promotion

Sales Promotion
Need and importance of sales promotion Usage of sales promotion programs is to generate additional sales for the product To counter the competitive moves; to generate sales during off seasons; to motivate people to use more of the same product To generate trade and sales force support for a new product line or an

extension
To motivate retail and other members in the value network To have additional inventory and to push the product in the market.

21
PREVIOUS HOME
CNEXT onfidential

Unit-2 Sales Strategies and Sales Promotion

Sales Promotion
Tools of sales promotion Prize schemes: A prize scheme is designed for both the public and the dealers. Trade fairs and exhibitions: They play a substantial role in selling goods of different varieties to different people. The main objectives: Meeting potential customers Making direct sales Discovering new applications for existing products Introducing new products. Free samples: To introduce a new product and as a sales tool to attract the attention of prospects. Correspondence: It can communicate very effectively with prospects as well as potential customers and established for it is better equipped to write letters.

22
PREVIOUS HOME
CNEXT onfidential

Unit-2 Sales Strategies and Sales Promotion

Sales Promotion
Catalogues: It is from the catalogue files that one can get information required about different products of a particular manufacturer. The following purposes can be served by catalogues. To get orders To make the customers aware about the specifications To provide detailed information To solicit product sales. Advertising novelties: Small, interesting, or personally useful items, etc. can be used for sales promotion. An advertising novelty should meet the following requirements: It should not be a high cost item. The item should be eye-catching. It should be useful.
23
PREVIOUS HOME
CNEXT onfidential

Unit-2 Sales Strategies and Sales Promotion

Sales Promotion
Entertainment of customers: Entertainment is essential when a standardised product is sold in bulk lots. Sales contests: Main aim of sales contests is to motivate the sales personnel, increase sales and bring more profit to the company. Price-off: This is simply a reduction in the price of the product to increase sales and is very often used when introducing a new product.

24
PREVIOUS HOME
CNEXT onfidential

Unit-2 Sales Strategies and Sales Promotion

Sales Promotion
Refunds
Consist of straight cash, coupon values or a product offered to the consumer in return for a proof of purchase

Point-of-sales materials
Point-of-sales (POS) materials are elements of sales promotion displayed at the point of sales. They display persuades, reminds and gives details to the consumers about a specific brand

25
PREVIOUS HOME
CNEXT onfidential

Unit-2 Sales Strategies and Sales Promotion

Activity

Activity 1
If you have to sell a new brand of washing powder, try to analyze whether the type of specialization of the sales price is by product or by markets or by both.

Activity 2
If you had to sell a new model of car of an existing brand which type of promotion would you adopt? Why?

26
PREVIOUS HOME
CNEXT onfidential

26

Unit-2 Sales Strategies and Sales Promotion

THANK YOU

27
PREVIOUS HOME
CNEXT onfidential

27