- Posted by: Paul Christ
As we note in our Targeting Markets tutorial, to be considered a qualified target market, customers must meet five criteria: 1) have a need; 2) are eligible to buy; 3) can afford to buy; 4) have authority to buy; and 5) can be reachable by the marketer. Depending on the product or service, a big problem exists when potential customers have needs for a product (criterion #1) but lack the financial ability to afford the purchase (criterion #3). Of course, we frequently see this with very high-end products, such as luxury goods, which are often not an option for the majority of consumers due to the perceived high price. But, we also see this problem among low-income consumers seeking to satisfy basic needs such as food, clothing and health care.
While many businesses that market basic products will steer clear of trying to figure out ways to address the needs of low-income consumers, others are addressing these consumers by engaging in socially responsible activities. For example, in 2014 we saw how a candy company's social responsibility strategy was helping it enhance the value of its brand.
Yet, making a company look good is not the only potential benefit from being socially responsible. As discussed in this Harvard Business Review story, organizations in France are forming "social businesses" to address issues with economically isolated consumers. The social businesses have three major characteristic: 1) they provide solutions to important social issues; 2) they run a sustainable operation; and 3) they reinvestment profits back into the social business. The story provides insight into how various social businesses work. What is most intriguing is that these businesses are not all about providing low-cost, low-end products. In fact, the way these social businesses operate, many are providing very good quality products at low prices. How they are able to do this, including the relationships that need to be forged among different participants in the distribution channel, is a key takeaway from this story.
Another issue brought up that should also attract marketers' attention is how the social business model can lead to innovative ideas that can be applied to other markets. Several examples are discussed including how automobile company Renault learned that using computer driving games can help boost car sales among younger French drivers.
- Posted by: Paul Christ
In our last post, we mentioned that while advertising may hold more excitement than other forms of promotion, many organizations consider personal selling to be the most critical. However, one might raise the point that there are lots of organizations that do not field a sales force, so isn't selling only of concern to firms with salespeople?
Yes, it is true that many organizations are successful using other methods of promotion to get people interested in their product. For example, let's assume someone clicks on an Internet advertisement that directs them to an online retailer, such as Amazon.com. Once on Amazon, if they make a purchase they are doing so without a person selling to them. While it may be true that Amazon made a sale using an advertisement, it is important to realize that Amazon did not get to where it is today without engaging in personal selling. In its early days, Amazon (like many start-up companies) had to convince (i.e., sell) many others, such as venture capitalists, transportation companies, book distributors and even some authors, to believe in the company. In other words, selling should never be viewed as an activity that is only limited to getting customers to buy. There are other things individuals and companies must sell besides products or services. For instance, consider the following:
- Librarians face the challenge of getting customers to use their services as the Internet now offers access to numerous information sources previously only available in libraries.
- A writer, who has completed her first novel, must figure out how to reach a publisher and then convince the publisher to market the book.
- A parent may have to "sell" their teenager on putting down a video game and dressing in better clothing in order to go to grandma's house for dinner.
In each of these situations, something is being sold. Though it may seem far removed from what most people perceive as selling, the key is whether one person is persuading someone to do something. Whether it is making a purchase, obtaining a loan, accepting a point-of-view, changing attitudes or an infinite number of other behavioral decisions, it all comes down to mastering persuasive communication or selling. This is why we stated in our last post that all marketers (and even non-marketers) can benefit from understanding the skills that make a salesperson successful, including understanding the skills needed for persuasive communication.
LEARNING TO SELL
Since what many people in organizations and social situations do can be classified as selling, it makes sense to expand the learning of selling skills beyond sales professionals. For instance, university librarians may find that understanding selling skills could help to persuade students and other library customers to continue to rely on librarians for key service assistance.
But, how does someone, who is not part of a sales force, learn to sell? Fortunately, there is no shortage of sales training options. Essentially sales training is divided into two camps: 1) Self-Directed Training, where the trainee learns on their own; and 2) Professional-Directed Training, where someone teaches selling techniques.
Options for Self-Directed Training:
- Multimedia Training – There are many self-directed sales training programs available for purchase, including websites with online sales courses, that include multimedia content such as videos. A simple Internet search should produce many options.
- Books – A search on Amazon will reveal hundreds of trade books and textbooks on selling. Generally the best are those with the highest sales rankings or have been published in several editions over many years.
- Online Sources – Check out our Marketing Links section under Personal Selling and The Selling Process for links to other excellent Internet resources.
Options for Professional-Directed Training:
- Sales Trainers – The sales training industry, where an outside consultant offers on-site instruction, is huge. While more expensive than self-directed training, in-person training can be more effective since it can be customized to an organization's needs. Instructor-led training also offers trainees the opportunity to engage in role play situations to help develop their skills.
- Local Sales Professionals – Members of not-for-profit groups looking to learn more about selling techniques may want to tap into the knowledge and expertise of some of their local patrons or contributors who are sales professionals. These people may be happy to contribute their time to help with sales training.
Regardless of which training option is chosen, understanding basic selling techniques can help almost anyone perform better in business and social situations. Remember, everyone sells something, so why not learn to do it better.
- Posted by: Paul Christ
If you were to conduct a poll asking people what they believe to be the most exciting method of marketing promotion, nearly all will select advertising and not sales promotion, public relations or personal selling. The reason advertising would likely be the overwhelming selection is because it is the most familiar form of promotion. Thanks in large part to our frequent exposure to ads (possibly hundreds a day) and also the entertainment value ads can present (e.g., Super Bowl ads), it is easy to understand why advertising would rate as the favorite promotional method.
However, while most people may favor advertising, it would be a wrong to say advertising is the most important method of promotion for all marketers. The fact is, in many marketing organizations and especially those in the business-to-business market, the most important promotion exists with the sales force. Without effective salespeople, it would not be realistic for these organizations to operate a viable business, no matter how much is spent on advertising.
In addition to appreciating what salespeople do and the contributions they make, understanding certain skills that lead to sales success can benefit all marketers. In particular, as we point out in The Selling Process tutorial, the process salespeople follow to make a sale may be "beneficial for many others who do not view themselves in sales roles." This is particularly true for anyone who finds themselves in a situation that requires they persuade others to perform some action (e.g., convince boss to provide more funding, get staff-wide buy-in on new product). In other words, selling an idea or action rather than selling a product.
With this in mind, this story from Entrepreneur Magazine discusses ten mistakes salespeople regularly make that can lessen their chance of generating business. The mistakes include not asking the right questions, missing buying signals and not understanding key influencers. While the message in this story is clearly directed to those who sell, the insights provided can apply to anyone looking to improve their persuasive communication skills.
- Posted by: Paul Christ
Throughout our Principles of Marketing tutorials, we make a strong effort to point out how marketing is not just something that is only undertaken by for-profit companies; not-for-profits must also direct attention to developing a strong marketing plan. While both not-for-profit and for-profit organizations must engage in marketing activity, when it comes to the advertising side of marketing, it would appear there is a major difference between the two groups in that for-profits are by far bigger spenders. This is easy to see when watching television. It seems nearly all ads that appear are for products and services offered by for-profit companies.
But while ads by for-profits overwhelming dominant television, not-for-profits also use television ads to get their message out. In fact, because not-for-profit advertisements are less frequently presented compared to ads that promote products, advertisements by not-for-profits may be more likely to catch audience attention because they are often considered to be different. In the U.S., the most famous not-for-profit television advertisements have been developed by the Ad Council. Since the 1940s, this group has produced many legendary public service advertisements covering such issues as wildfire prevention, anti-pollution, crime prevention, autism awareness and many more.
While the Ad Council and other not-for-profit groups, such as charities, medical support groups, rights groups and environmental groups, focus on creating public awareness of important social, health and environmental issues, not-for-profit trade associations primarily use advertising to create public awareness of its members. Some examples of trade groups frequently promoting the services of its members are National Association of Realtors, with their message of how realtors can help; California Milk Processor Board, with ads encouraging milk consumption; and the American Petroleum Institute, with ads supporting energy independence.
We can now add to the list of not-for-profit trade groups who spend large sums on advertising, the American Institute of Architects (AIA). As reported in this AdWeek story, for the first time in its 157-year history, the AIA has launched an advertising campaign with the goal of building awareness of what architects do. Apparently the motivation for this comes from research suggesting, that while architects are well respected, the tasks they perform are not well understood. While the amount of money being spent on this campaign is not known, the group does indicate this is just the beginning of a three-year campaign, suggesting they have budgeted several million dollars to get their message out.
- Posted by: Paul Christ
When we look at the wide range of activities that fall under the area of Marketing, there are a few that sometimes lead to questions of whether these are truly part of marketing. This is often due to the perceived separation that exists within many companies. Probably the most often cited example is the personal selling function. Many companies separate Marketing and Sales within their organizational structure, even though the activities performed by salespeople are clearly part of how we define Marketing.
Another area that is often considered a separate entity is Public Relations. As we note in our Public Relations tutorial, while PR is part of the promotional mix, what PR people do is not always well understood. The experience some have with PR is that of it is more focused on being relational rather than promotional. For instance, PR professionals are often a key link between the company and its investors, and communicate with their investors through frequent press releases. However, relationship building with investors is only a small part of what PR professionals do; they can also be very effective in carrying out promotional activity. We note many of these activities in our Types of Public Relations Tools tutorial, such as building relations with the news media in the hope of getting a favorable story written about the company.
There is also a rapidly evolving outlet for public relations that is shifting PR even more toward the promotional side. This outlet is social media. For instance, posts made to Twitter, Facebook, and Instagram are generally categorized as public relations as these postings do not require payment for placement, and the message is totally controlled by the promoting company. The same applies to videos posted on YouTube. While many company-posted videos may seem like advertisements, the condition that no payment is made for the posting would then led these to be classified as public relations.
Unlike more traditional PR outlets, social media can be a much riskier place to communicate a message. The biggest risk is that any mistake or misunderstanding that occurs can be rapidly spread and possibly result in bad PR for the promoting company. A good example can be seen in this story from ClickZ that discusses a PR problem experienced by Pizza Hut in Australia. The company posted a video on YouTube that included the name of a product (Vegemite) that is owned by Mondelēz International (formerly part of Kraft Foods). Unfortunately for Pizza Hut, the Vegemite name is trademarked by Mondelēz, which did not give Pizza Hut permission to use the name in the video. This forced Pizza Hut to pull the video but not before it caught the attention of the news media.