Selling vs Marketing

8/7/2019 Selling vs Marketing

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Sales and marketing areSales and marketing aredifferentdifferent

Marketing: What and how to sell

Selling: moving the product

Relationship management



MarketingMarketing

What?² Product characteristics - ACCTO

² Price sensitivity

Market Characteristics² Size

² Defensible

² Sustainable

How?² Channels

Inform² Routes



Product or ServiceProduct or ServiceRequirementsRequirements

Know about it

Opportunity to purchase²

shelf space Satisfy a real or perceived need

Affordable (but not too cheap)



Basic Economics IBasic Economics I

Demand curve: Price depends on volume

Elasticity e = P(

Q

---- -------

(P QPrice P

Quantity Q



Supply CurveSupply Curve

Stable point is at intersection (Spiderdiagram)

Price P

Quantity Q

Supply

S

Demand

D



Cost of ProductionCost of Production

-10

-5

0

5

10

15

20

25

1 3 5 7 911

13

15

Quantity

Money Unit Cost

Unit Price

Profit/unit



Gross ProfitGross Profit

0

20

40

60

80

100

120

1 2 3 4 5 6 7 8 9 10

Quantity

Money Revenue

Expenditure

Gross Profit



ChannelsChannels

Direct Sales

Distributor/Retailer²

Distributors are your customers� National

� International

Chose carefully -² changing is expensive and difficult

² Key sales

² Opinion formers



Direct salesDirect sales

Bespoke -² sales staff/ Customer relationship manager

² cash flow

Mail order requirements² Product

² Guarantees

² Stocking

² Support

² Key accounts

² Market communications



Distribution ChannelDistribution Channel Typical product

² 40%manufacturer

� development, materials, overheads, profit,research

² 30% distributor

� Advertising, stocking, profit

² 30% retailer

� Local adverts, shop front, staff, profit

International² Localisation

² Country agent

� control/performance

² Trade fairs

� DTI outward bound missions

� Embassy



Ballpark pricingBallpark pricing

Sales price: 1000.00

Factory price: (60%) 600.00

Cost (30% of factory price) 200.00Net profit /unit (10% of factory price) 60.00

Annual sales (Million): 1.00 (guess)

Profit £M 60.00

Set-up and fixed costs (£M) : 50.00 (including initial marketing)

Stocking (6 months at cost) 100.00

Capital need 150.00

Payback time 2.50 years



Market CommunicationsMarket Communications

Targeting

Advertising² I

mage² Message

² Sales - MOP

� General - Newspapers, TV

� Specific - Trade press, specialist magazines

PR

Direct mail² List brokers

� 1-2% response

� Control and record-keeping



ExhibitionsExhibitions

Expensive, hard work

Make it obvious

Place for meetings, not cold sales Preparation

² Stand

² Exhibits

² Manual

²

Travel and accommodation

Be attentive

Follow-up² Timeliness



Sales techniques: listenSales techniques: listento the customerto the customer

Needs

Concerns

Authority



Stages in SellingStages in Selling

Prospecting

Pre-approach

Approach Survey

Proposal

Demonstration

Close Service



ProspectingProspecting

Locating the most likely buyers² Cold calling

� DirectorsGuides, Yearbooks

� Local council offices, Chambers of Commerce

� Institutional meetings

² Qualified Prospects

� Marketing response: Advertising, PR, Mailings

� Service organisation, exhibitions

How many?² 10% result in a sale

² Maybe 2 calls per day



PrePre--approachapproach

Research² Who are the decision makers?

² What is the management structure?

² What are their concerns?

Preparation² Presentation

² Visiting cards, brochures



ApproachApproach

Listen, establish mutual ground

Contact building

Generalities



SurveySurvey

Needs, requirements

Constraints

Budget Structure, contacts, decision points

Timescale



ProposalProposal

Sell the benefits to the customer² F.A.B

² U.S.Ps

² Price is not an issue; value is

� Lifetime cost

� Service, reliability, reputation

Sales proposal² Introduction

² Objectives

² Recommendations

² Benefits

² Financial Justification

² Warranty and service

² Company Background

² Price and conditions

Follow-up



DemonstrationDemonstration

Objectives

Administration²

Who, where, maps, car parking, accommodation² Greeting, seating

² Catering: coffee, lunch or sandwiches

Script² Rehearse, and stick to the script

² Points to emphasise, or not

Sum up

Agree follow-up



CloseClose

Small step at a time

Advantages

Customers concerns² hidden agenda

Kicker² Discount, limited offer



Planning and RecordsPlanning and Records

Graded Prospect List

Sales Forecasts

Call analysis

Sales Cost analysis

Company ContactPrevious Contact Next Contact

Name Address Phone Fax Name Decision Makers Potentia l % Date Who Action

Company Amount ------Time Analysis------- Product Analysis Comments

Q1 Q2 Q3 Q4



Control and CommissionsControl and Commissions Control

² Sales organisation structure

� By product

� Geographical

�

By channel, key account Measurement

� Cost per sale

� Response rate

� Timeliness

� Individual measures, targets

Commission² Don·t stint

� Basic salary

² Pay on delivery, or payment

Selling vs Marketing

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