Chapter objectives

• Understanding and appreciate the differences between sales and

marketing strategies
• Appreciate where the key marketing concepts fit into the planning
process
• Identify component parts of the communication mix
• Differentiate between objectives, strategies and tactics
 Sales orientation

Production Sales Customers

Based on the seller’s needs

 Marketing orientation

Customer
production Sales
needs

Emphasis on Customer’s needs

 Product life cycle
• Life cycle pattern of humans and has four distinct stages
• Introduction – growth - mature - decline
Introduction Sales growth is relatively slow
Sales needs to persuade and convinced for existences, awareness and
whether the product is worthwhile purchase

Growth Sales start to escalate

Better publicity through W.O.M
Profits begin to be made

Maturity Sales growth starts to slow down and become saturated

Few new buyers and high proportion of repeat sales

Decline Sales begin to fall and slim profit margin

Customers might have become bored with the product
 Sale planning
• Sale planning is a key function in the procedure of sales management
process. Sales planning is an effective method that need for business to
achieve goals. Sales plan contains a strategic document that figures out
your business targets and several resources
• Sales planning will be short run and long run
 Short, mid and long run sales plan
• Short term planning tends to focus on improve employee skills and
prepare for facilities needed
• Medium term planning focuses on solving the short term planning and
implement policies, procedures to ensure that short-term problems
don’t recur.
• Long term planning react to the competitive situation of the company,
develops strategies for adapting and influencing its position to achieve
objectives
 Sale plan tend to focus on
• Customers (industry and market)
• Employees
• Products/ services
• Competition situation
 The good plan..
• Vision
• Mission
• Goals and objectives (the objectives need to be SMART)
• Strategies and tactics
 Why sales planning is important
• Foresee potential risks so that you can try and mitigate them
beforehand.
• Devise strategies according to culture, needs, and requirements of each
consumer market
• Benefits to end users through qualities, and customer services
• Benefits to salesforce through bonuses and salaries.
The relationship between sales and
marketing
 Marketing strategy and sales
management
Strategic marketing Sales objectives Sales strategies
objective

Build Build sales volume High call rate on existing account

Increase distribution High focus during call
Provide high service levels Calling new account
Hold Maintain sales volume Continue present call rate
Maintain distribution Medium focus during call
Maintain service level Call on new outlets
Harvest Reduce selling costs Call only on profitable accounts
Target profitable accounts Consider telemarketing or dropping
Reduce service cost and inventories the rest
Divest Clear inventory quickly Quantity discounts to targeted
account
Sales planning process
Establishing marketing plans
• Objectives: where do we intend to go (goals)
• Strategies: how do we intend to get there (broadly descriptive)
• Tactics: the precise route to be taken (detailed)
 Market analysis/ marketing audit
• Internal audit and external audit
• SWOT analysis and PESTEL analysis
 SWOT analysis
• Research on current and recent size and growth of market
• Analysis of customer needs, attitudes and trend in purchase behavior
• Current marketing mix
• Competitor analysis
 SWOT analysis (cont)
• Strengths, Weaknesses, Opportunities and Threats
• Once analysis, the statement should be short and tend to be in bullet
points
Example of SWOT analysis (Boots)
 PEST/PESTEL analysis
• External environment
• Political – Environmental – Social – Technological – Economical –
Legal
• PESTEL subject should be a clear definition of the market addressed
for business to suit the market it is intending to join
 Porter’s five forces
• Existing competitive rivalry between suppliers
• Threat of new market entrants
• Bargaining power of buyers
• Power of suppliers.
• Threats of substitute products
 The 4Ps and switching to 4Cs
• Price: Price level, credit term, discounts
• Products: Features, packaging, quality, range
• Promotion: advertising, publicity, sales promotion, personal selling,
sponsorship
• Place: inventory, channels of distribution,
 The 4Cs
• Customer: study about customer or consumer needs and demands
• Cost: money, price
• Convenience: where to buy the products, or how to make consumers
easy to pick up
• Communication: give and take between the buyer and seller
 How 4Ps and 4Cs of marketing mix
fit
• Think about product, consider what solution it is providing for the
customers
• Think about price, consider what cost, the customer is willing to pay
• Think about place, consider how convenient it is to find, buy and
actually get in hands
• Think about promotion, consider the communication the customer
prefer and through which channels they will be more receptive
 Market segmentation
• Is the process of identifying those lusters of customers in a market that
share similar needs and wants and will respond in a unique way to a
given marketing effort
• Decide which are most attractive and to which segments it can market
most effectively.
Type of market segmentation
 Benefits of market segmentation and
targeting
• Clearer identification of market opportunities in the market
• The design of products and market appeals that are more finely tuned
to the needs of the market
• Focusing of marketing and sales efforts on those segments with the
greatest potential
The place of selling in the marketing
strategies
 Sales functions
• Analysis of current market situation
• Determining sales potential
• Generating and selecting strategies
• Budgeting, implementation and control
 Analyzing the current market
• Sales is contributing its functions in analyzing the market that an
organization is facing
• Understanding customer needs and the behavior.
• Sales manager has the knowledge in competitors in market place
 Determining the sales potential
• Analyzing the short-, medium- and long term forecast by allocating
the resources to achieve potential sales
 Break Even Point
Break- Even point (BEP) is going to show the Sales manager
the Units and Sales revenue needed
Support the short, medium and long term planning in sales
strategies.
Can also decided prices that the company can charge in the
products
 Break Even Point Sales Revenue
(SR)

Break Even
Sales Revenue Point
Total Costs (a+b)

Variable Cost (VC)

[b]

Fixed Costs (FC) [a]

Output (Units)
 Formula for calculating BEP in Units
and Dollar Sales
Break Even Point in Units Break Even Point in Dollar Sales

𝐹𝑖𝑥𝑒𝑑 𝑐𝑜𝑠𝑡𝑠 (𝐹𝐶) 𝐹𝑖𝑥𝑒𝑑 𝐶𝑜𝑠𝑡𝑠 (𝐹𝐶)

• 𝐵𝐸𝑃 = • 𝐵𝐸𝑃 =
(𝑆𝑃−𝑉𝐶) 𝐶𝑜𝑛𝑡𝑟𝑖𝑏𝑢𝑡𝑖𝑜𝑛 𝑚𝑎𝑟𝑔𝑖𝑛 𝑟𝑎𝑡𝑖𝑜
 Generating the sales strategies
• Sales manager contribute to different options by consulting the board

Strategy 1 Targeting Segments must be potentially profitable

Life stage
Value (high or low consumption)

Strategy 2 Pricing Short-term tactical reductions

Price premium
Elevate perceived quality

Strategy 3 Customer retention Cost of acquisition

Repeat purchase
Up-trade
 Budget, implementing and control
• Determining the level of expenditure to forecast the level of sales
• Need to consider the whole company
• Apart from production level, budget consider the level of salesforce
salaries, commission and bonuses
Stage of buying decision