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Chapter - 2Chapter - 2Sales StrategiesSales Strategies

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Sales and Marketing PlanningSales and Marketing PlanningTo be effective, sales activities need to To be effective, sales activities need to take place within the context of an overall take place within the context of an overall strategic marketing planstrategic marketing planThe current general consensus is that The current general consensus is that sales strategies and tactics may only be sales strategies and tactics may only be arrived at, implemented and assessed arrived at, implemented and assessed against a framework of company wide against a framework of company wide objectives and strategic planning processobjectives and strategic planning process

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The Planning ProcessThe Planning ProcessThe nature of the planning process is The nature of the planning process is outlined in Fig. 2.1outlined in Fig. 2.1The planning process can be described The planning process can be described through the acronym through the acronym MOST MOST which which describes the process from the general to describes the process from the general to the specific:the specific:MissionMissionObjectiveObjectiveStrategyStrategyTacticsTactics

Figure 2.1 The planning process

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Establishing Marketing PlansEstablishing Marketing PlansThere is no universal way of establishing There is no universal way of establishing an ideal marketing plan: neither is the an ideal marketing plan: neither is the process simple in practice because every process simple in practice because every planning situation is uniqueplanning situation is uniqueThe marketing plan can be portrayed The marketing plan can be portrayed having three levels:having three levels:Objectives:Objectives: Where do we intend to go? Where do we intend to go? GoalsGoalsStrategies:Strategies: How do we intend to go there? How do we intend to go there? Broadly descriptiveBroadly descriptiveTactics:Tactics: The precise route to be taken The precise route to be taken

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Business definitionBusiness definition( corporate mission or goal)( corporate mission or goal)Situation analysisSituation analysis – SWOT analysis – SWOT analysisMarket analysisMarket analysis ( or marketing audit) ( or marketing audit)The external audit consists of an analysis of The external audit consists of an analysis of broad macro- environment trends- Political, broad macro- environment trends- Political, Economic, Socio-cultural and technological Economic, Socio-cultural and technological ((PESTPEST) – that might influence the future of the ) – that might influence the future of the company’s businesscompany’s businessThis original description was first extended to This original description was first extended to SEPTL SEPTL with introduction of with introduction of Legal factorsLegal factors, and then , and then to to PESTLEPESTLE with the introduction of Environmental with the introduction of Environmental factors (Kyoto) and now to factors (Kyoto) and now to STEEPLESTEEPLE with the with the introduction of Ecological factors such as climateintroduction of Ecological factors such as climate

Examples of data analysis required under the Examples of data analysis required under the internal audit internal audit include the following:include the following:1.1. current and recent size and growth of market;current and recent size and growth of market;2.2. analysis of customer needs, attitudes and trends analysis of customer needs, attitudes and trends

in purchasing behaviour;in purchasing behaviour;3.3. current marketing mix;current marketing mix;4.4. competitor analysis, including an appraisal of:competitor analysis, including an appraisal of:

• current strategy;current strategy;• current performance;current performance;• their strengths and weaknesses andtheir strengths and weaknesses and• expectations as to their future actions.expectations as to their future actions.

Marketing analysis (or marketing audit)

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Statement of objectives:Statement of objectives: Objectives form Objectives form the basis for selection of marketing the basis for selection of marketing strategies and tacticsstrategies and tacticsA company may have several objectives – A company may have several objectives – Production objectives, Financial objectivesProduction objectives, Financial objectivesMarketing objectives usually tend to Marketing objectives usually tend to support business objectives, support business objectives, Business and marketing objectives may Business and marketing objectives may also be one and the samealso be one and the same

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The following criteria are necessary for The following criteria are necessary for setting objectives:setting objectives:Ensure objectives focus on resultsEnsure objectives focus on resultsEstablish measures against objectivesEstablish measures against objectivesWhere possible have single theme for Where possible have single theme for each objectiveeach objectiveEnsure resources are realisticEnsure resources are realisticEnsure marketing objectives are integral to Ensure marketing objectives are integral to corporate objectivescorporate objectives

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Determine sales and market potential and Determine sales and market potential and forecast salesforecast salesA critical stage in the development of marketing A critical stage in the development of marketing plans is the assessment of market and sales plans is the assessment of market and sales potential followed by the preparation of a potential followed by the preparation of a detailed sales forecastdetailed sales forecastGenerating and selecting strategies:Generating and selecting strategies:Once marketing objectives have been defined Once marketing objectives have been defined and market potential has been assessed, and market potential has been assessed, consideration should be given to the generation consideration should be given to the generation and selection of strategiesand selection of strategiesBroadly, strategies encompass the set of Broadly, strategies encompass the set of approaches that the company will use to achieve approaches that the company will use to achieve its objectivesits objectives

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GOSPA GOSPA is a corporate performance is a corporate performance management process that implements and management process that implements and produces measurable resultsproduces measurable resultsIt stands for Goals, Objectives, Strategies, It stands for Goals, Objectives, Strategies, Plans and ActionsPlans and ActionsUsing this process improves Using this process improves communication, control, morale, communication, control, morale, measurement and performance through a measurement and performance through a set of easy to implement stepsset of easy to implement stepsIt is appropriate for organizations both It is appropriate for organizations both large and smalllarge and small

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Preparing the marketing program:Preparing the marketing program:The first step in the preparation of this program The first step in the preparation of this program is the determination of the marketing mixis the determination of the marketing mixAllocating resources – Budgeting:Allocating resources – Budgeting:The next step is to assemble a budget for each The next step is to assemble a budget for each of the marketing mixof the marketing mixImplementation:Implementation:Once approved, details of the marketing plan Once approved, details of the marketing plan should be communicated to every one involvedshould be communicated to every one involvedControl:Control: Finally, the plan should contain an Finally, the plan should contain an outline of the control mechanisms that will be outline of the control mechanisms that will be appliedapplied

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Contribution of sales function:Contribution of sales function:Some of the stages in the planning Some of the stages in the planning process where the sales function can process where the sales function can make a valuable contributionmake a valuable contributionAnalysis of the current market situationAnalysis of the current market situationDetermining sales potential/ sales Determining sales potential/ sales forecastingforecastingGenerating and selecting strategiesGenerating and selecting strategiesBudgeting, implementation and controlBudgeting, implementation and control

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The promotion mix:The promotion mix: In most companies all In most companies all four major traditional elements can four major traditional elements can contribute to company sales, but a contribute to company sales, but a decision has to be made as to where to decision has to be made as to where to place the emphasisplace the emphasisSeveral factors influence the planning Several factors influence the planning decision as to where to place emphasis decision as to where to place emphasis within the promotional mixwithin the promotional mixIt can be sales force, advertising, sales It can be sales force, advertising, sales promotionpromotion

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Some of the more important factors Some of the more important factors influencing the influencing the promotion mix decisions promotion mix decisions are:are:Type of marketType of marketStage in the buying processStage in the buying processPush versus pull strategiesPush versus pull strategiesStage in the product life cycleStage in the product life cycleTo these traditional elements can now be To these traditional elements can now be added :added :Direct MarketingDirect MarketingInteractive/ internet marketingInteractive/ internet marketing

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Advertising plays a key role in aiding the Advertising plays a key role in aiding the sales effort, reducing selling costs and sales effort, reducing selling costs and easing the sales taskeasing the sales taskBrand/ supplier- loyal customers are a Brand/ supplier- loyal customers are a valuable asset to any company and the valuable asset to any company and the sales force is central to the establishment sales force is central to the establishment and maintenance of such customer loyaltyand maintenance of such customer loyalty