MODUL MKT 2013 Jun Juhaizi Juhari

PRINCIPLES OF MARKETING (MKT 2013)

3. Demonstration
▪ Demonstration is required when
products are complex and of a
technical nature.
▪ Customers are educated as to
how to make proper use of the
product.
▪ Demonstration of products
induces customers to buy.
Demonstrations are provided free of cost.

4. Contests
▪ Contests are the promotion events that give
consumers the chance to win something such
as cash, trips or goods. Contests are
conducted to attract new customers. They
introduce new product by asking the
prospects to state the reasons for the
purchase of the product.
▪ The buyer purchases the product and submits
the evidence of purchase with entry form for contest. Entry forms are duly filled by the
buyers. A panel of judges selects the best and buyers are given prizes.

5. Cash refund offer
▪ Cash refund offers are rebates allowed from the
price of the product. It is an offer to refund part
of the purchase price of a product to consumers
who send a proof of purchase to the
manufacturer.
▪ Moreover, if the purchaser is not satisfied with the
product, the whole price or part of it will be
refunded. Cash refunded offer is stated on the
package.

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6. Premium
▪ Premium refers to goods offered either free or
at low cost as an incentive to buy a product. A
premium may be inside the package, outside it
or received through mail. The reusable
package itself serves as a premium.
▪ Premium is generally offered for consumer
goods such as soap, toothpaste, etc. Premium
may be of several kinds — direct premium,
reusable container free in mail premium, a self
liquidating premium, trading stamps, etc.
▪ Direct premium can be inside the pack or outside it. A reusable container can be reused
after the product is reused. Free in mail premium means a premium item will be sent by
mail to consumers who present proof of purchase to the manufacturer.
▪ A self liquidating premium is the extra quantity offered at the normal price. Trading stamps
are given by the seller to consumers. These are redeemable at the stamp redemption
centres.

7. ‘Price off’ offer
▪ Goods are sold at reduced prices during slump season.
Reduction in prices stimulates sale of goods.

8. Consumer sweepstakes
▪ A sweepstakes calls for consumers to submit their
names for a draw. Names of consumers are included in
a list of prize winning contest. The lots are drawn and
the winners get prizes.

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9. Buy back allowances
▪ Allowances are granted to buyers on the basis of their
previous purchases. In other words, buy back
allowances are given for new purchases, based on the
quantity of goods bought previously.

PERSONAL SELLING

Personal Selling is an effective way to manage personal customer relationships. The sales person
acts on behalf of the organization. They tend to be well trained in the approaches and techniques
of personal selling. However sales people are very expensive and should only be used where there
is a genuine return on investment. For example salesmen are often used to sell cars or home
improvements where the margin is high.

It refers to Person to person communication with potential customers in an effort to inform,
persuade, or remind them to purchase an organization’s products or services.

Commonly used in industry where vendors meet with clients to inform them of potential products
or services.. This type of selling, professional selling usually requires a large amount of information
about the product or services and the customer’s needs. It also requires a lot of follow up after a
sale to insure the client is satisfied and will reorder. Example: as you walk into a furniture store,
you are approached by a salesperson to assist you with your purchase.

Advantages and disadvantages

Advantages Disadvantages

• Highly interactive - lots of • Costly - employing a sales force has
communication between the buyer many hidden costs in addition to
and seller wages

• Excellent for communicating • Not suitable if there are thousands of
complex / detailed product important buyers
information and features

• Relationships can be built up -
important if closing the sale make
take a long time

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Steps in the Selling Process
There are many steps involved in the process of personal selling: prospecting, pre-approach,
approach, sales presentation, handling objectives, and follow up.

Prospecting
The first step of the personal selling process is called ‘prospecting’. Prospecting refers to locating
potential customers. There are many sources from which potential customers can be found:
observation, social contacts, trade shows, commercially-available databases, commercially-
available mail list and cold calling.

Pre-Approach
The nest step in the personal selling process is called the ‘pre-approach’. The pre-approach
involves preparation for the sales presentation. This preparation involves research about the
potential customers, such as market research. Research is useful in planning the right sales
presentation. During the pre-approach the salesperson may also plan and practice their sales
presentation.

The Approach
The next step in the personal selling process is called the ‘approach’. The approach refers to the
initial contact between the salesperson and the prospective customer. During this stage the sales
person takes a few minutes for “small talk” and get to know the potential customer. The goal of
the approach is to determine the specific needs and wants of the individual customer, as well as
allowing the potential customer to relax and open up.

Sales Presentation
The next step in the personal selling process is called the ‘sales presentation’. The sales
presentation involves the salesperson presenting the product or service, describing its qualities and
possibly demonstrating features of the product. Ideally the sales presentation will be individualized
to match the needs and desires of the potential customer.

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Handling Objectives
In some cases, after receiving the sales presentation, the potential customer will have some
questions or concerns. In order to secure a sale, the salesperson must address these questions or
concerns; this step is referred to as ‘handling objectives.’

Closing the sale
The next step in the personal selling process is referred to as ‘closing the sale’. ‘Closing the sale’
refers to finalizing the sale and persuading the potential customer to make the purchase. During
the ‘closing the sale’ step, prices and payment options may be negotiated.

Follow up
The final step in the personal selling process is referred to as the ‘follow up.’ The follow up involves
the salesperson contacting the customer after the sale to ensure that the customer is satisfied. If
the customer has any existing issues with the product, the salesperson will address them. A
successful follow up stage of personal selling can be very effective in ensuring repeat sales,
evaluating the effectiveness of the salesperson, and obtaining additional referrals from the
satisfied customer.

DIRECT MARKETING

▪ Direct marketing is a form of advertising that reaches its audience directly through multiple
channels including email, direct mail, social media, catalogs, online advertising,
interactive television, etc.

▪ There are two main definitional characteristics which distinguish it from other types of
marketing. The first is that it sends its message directly to consumers, without the use of
intervening commercial communication media. The second characteristic is the core
principle of successful Advertising driving a specific "call to action." This aspect of direct
marketing involves an emphasis on tractable, measurable, positive responses from
consumers (known simply as "response" in the industry) regardless of medium.

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Types of Direct Marketing:

The most common forms of direct marketing are:
▪ Internet marketing
▪ Face-to-face selling
▪ Direct mail
▪ Catalogs
▪ Telemarketing
▪ Direct-response advertising
▪ Kiosk marketing

1) Internet Marketing

▪ The Internet has revolutionized direct marketing for promoting the sale of products and
services to targeted audiences.

▪ Access to the Internet provides users with services in four basic areas:

✓ Information

✓ Entertainment

✓ Shopping

✓ Individual and group communication

▪ Online channels can eliminate geographic considerations. With this capability people
around the world have the same access as the person across the street. Many businesses
that can sell their products and services through downloading, or who can economically
ship those products, have discovered an entirely new way to market.

▪ The Internet makes direct marketing easier, more targeted, more flexible, more responsive,
more affordable, and potentially more profitable than ever. Virtually every business should
seriously consider the Internet as a part of their marketing mix and determine if it is a viable
fit for their direct marketing efforts.

2) Face-to-Face Selling
▪ The most traditional direct marketing involves the in-house sales force personally
contacting potential and established consumers.
▪ Examples of organizations that use face-to-face selling include:
✓ Mary Kay
✓ Avon
✓ Amway

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3) Direct Mail
▪ Direct mail is described as sending information about a special offer, product or sale
announcement, service reminder, or some other type of communication to a person at a
particular street or electronic address.
▪ Historically direct mail has existed in the form of printed materials, but CDs, audio tapes,
video tapes, fax mail, email, and voice mail are also used in direct mail campaigns.
▪ For example, America Online experienced a highly successful campaign through mailing
out CD-ROMs to prospective customers.
▪ Direct mail permits high target-market selectivity; it can be personalized, it is flexible, and
it allows early testing and response measurement to take place.
▪ A highly selective and accurate mailing list often determines the success of direct mail
efforts to enhance response rates and control costs.

4) Catalogs
▪ Product catalogs are another version of direct mail where the catalogs are the
communication tool.
▪ The most common use of this approach involves featuring a variety of products that target
the needs of a specific audience who have shown a propensity to order from catalogs.

5) Telemarketing
▪ The process of contacting people on a qualified list to sell services over the phone has
grown in popularity to the point that the average household receives 19 telemarketing
calls each year. Successful telemarketing campaigns depend on a good calling list, an
effective script and contact structure, and well-trained people that are compensated
and rewarded for making calls that result in sales.
▪ The telecommunications industry, for example, has used telemarketing extensively to
attempt to increase their market share.
▪ This includes:
✓ AT&T
✓ MCI WorldCom
✓ Sprint

6) Direct-Response Advertising
▪ Direct-response advertising is communicating with potential buyers through television,
radio, magazines, and newspapers.
▪ The prospective consumer watches, hears, or reads about the product or service and
initiates a call to a toll-free number to place their order.
▪ Television, for example, offers a wide range of exposure, from a 30-second commercial to
a 60-minute infomercial.
▪ For example: Go Shop, CJ Wow Shop

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7) Kiosk Marketing
▪ Customer order machines, versus vending machines that actually provide products, are
another form of direct marketing.
▪ Examples are: your bank’s automatic teller machines (ATMs) placed in convenient and
high traffic areas are another example of kiosk marketing.

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REFERENCES

Kotler, P. & Armstrong, G. (2018). Principles of Marketing: Global Edition (17th. edition). Pearson
Education.

Kotler, P., Keller K.L, Ang, S. W., Meng, L.S., & Tan C.T. (2018). Marketing Management:An Asian
Perspective (7th Ed.). Harlow, England: Pearson Education.

Perreault, W. D., Mc Carthy, E. 1. & Cannon, 1. P. (2017). Essentials of Marketing (12nd.Edition).
New York, NY: Mc Graw Hill Education.

https://www.marketing91.com/

https://www.marketingtutor.net/

https://www.marketing-schools.org

https://businesscasestudies.co.uk/

https://www.ama.org/

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