MK Chapter 18 Flashcards
Major Sales Management Decision Areas
- Establishing sales force objectives
- determining sales force size
- recruiting and selecting salespeople
- training sales personnel
- compensating salespeople
- motivating salespeople
- managing sales territories
- controlling and evaluating sales force performance
Major Types of Sales Force Compensation Methods
Straight Salary
Straight Commission
Combination
Straight Salary
- Paying salespeople a specific amount per time period
- Most useful when compensating new salesperson, moving into new territories or customers, sales requiring many services for customers
- Salary remains the same until pay increase
- Provides salespeople with more security but less incentive
Straight Commission
- Paying salespeople according to the amount of their sales in given time period
- Commission may be based on percentage of sales or on a sliding scale
- Requires highly aggressive selling and minimal nonselling tasks
- Provides salespeople with maximum incentive but little financial security
Combination
- Paying salespeople a fixed salary plus a commission based on sales volume
- Most popular compensation method
- Provides level of security and some incentive
- Can require that salesperson exceeds a certain sales level before earning a commission
Consumer Sales Promotion Methods
- Coupons and Cents-Off Offers
- Refunds and Rebates
- Frequent User Incentives
- Point-of-Purchase Materials
- Free Samples and Premiums
- Premiums
- Consumer Games, Contests, and Sweepstakes
Coupons and Cents-Off Offers
Cents-off offers
-Promotions that let buyers pay less than the
regular price to encourage purchase
Refunds and Rebates
Money refunds
-Offering consumers money when they mail in
a proof of purchase, usually for multiple
product purchases
Rebates
-Sending consumers a specific amount of
money for making a single product purchase
Frequent User Incentives
Incentive programs that foster consumer
loyalty by rewarding customers’ repeat (frequent) purchases
Point-of-Purchase Materials
Point-of-purchase displays
-Signs, window displays, display racks, and
similar means used to attract customers and to
encourage immediate purchases
Demonstrations
-Manufacturers use it temporarily to encourage
trial use and purchase of a product or to show
how a product works.
-Highly effective yet costly in practice
Free Samples and Premiums
Free samples
-Samples of a product given out to encourage
trial and purchase
-Used to increase sales volume and obtain
desirable distribution for fast turnover products
-The most expensive form of sales promotion
Premiums
-Items offered free or at a minimal cost as a
bonus for purchasing a product
-Premium must match both the target market
and the brand’s image.
-Premiums must be easily recognizable and
desirable.
Consumer Games, Contests, and Sweepstakes
Consumer contests and games
-Individuals compete for prizes based on
analytical or creative skills.
-Competitions for prizes are used to generate
retail traffic and to increase exposure to
promotional messages.
Consumer sweepstakes
-A sales promotion in which entrants submit
their names for inclusion in a drawing for
prizes
-Used more than contests and attract more
widespread interest
Trade Sales Promotion Methods
Trade Allowances Cooperative Advertising and Dealer Listings Free Merchandise and Gifts Premium (Push) Money Sales Contests
Trade Allowances
Buying allowance
Buy-back allowance
Scan-back allowance
Merchandise allowances
Buying allowance
A temporary price reduction to resellers for purchasing specified quantities of a product
