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In this chapter, we will address the following questions:

1. How can companies use integrated direct marketing for competitive advantage?

2. How can companies use interactive marketing and word of mouth most effectively?

3. How can personal selling be used to build profitable customer relationships?

4. What decisions do companies face in designing and managing a sales force?

C H A P T E R 1 7

Managing PersonalCommunications

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MARKETING MANAGEMENT AT COCA-COLA

Coca-Cola, with global sales of $24 billion per year, has a long history of reaching out to con-sumers through eye-catching television and magazine ads, colorful billboard ads, store displays,and other mass communications. Now the company is using the Internet to get consumers moreactively involved with its iconic brand. It changed Coke.com from a typical corporate Web site,complete with facts, figures, and annual reports, to an interactive community for consumers to

share their creativity. Its MyCoke.com site invites visitors to participate in a virtual world, playgames, mix music tracks, read or write blog entries, download screen savers, and more. Knowing

that not every online feature will gain an audience right away, Coca-Colalike other advertisershas been experimenting to discover which site activities will draw audiences most effectively.The company is also inviting interaction through activities inside Second Life, the popu-

lar online community. For example, it invited consumers to design a virtual vending machinethat could dispense the essence of Coca-Colaentertainment, adventure, or happinessas wellas satisfy curiosities and fulfill virtual wishes. And it used Second Life for the high-profile pre-miere of Happiness Factorythe Movie, the follow-up to its award-winning commercial.Through the short film and other promotional elements, including authentically designedmovie posters, movie-style trailers, an interactive digital program, promotions, and packaging,we were able to extend the life of this campaign, says a Coca-Cola spokesperson.1

A Framework for Marketing Management, Fourth Edition, by Philip Kotler and Kevin Lane Keller. Published by Prentice Hall.

Copyright 2009 by Pearson Education, Inc.


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Chapter 17 Managing Personal Communications 303

M arketing communications are increasingly seen as an interactive dialoguebetween the company and its customers. Marketers must ask not only Howcan we reach our customers? but also How can our customers reach us? Its criticalto personalize messages and create dialogues by communicating with the right per-son at the right time. This chapter discusses direct marketing, interactive marketing,

word-of-mouth marketing, and personal selling and the sales force.

DIRECT MARKETING

Direct marketingis the use of consumer-direct channels to reach and deliver goodsand services to customers without marketing middlemen. These channels includedirect mail, catalogs, telemarketing, interactive TV, kiosks, Web sites, and mobiledevices. Direct marketers seek a measurable response, typically a customer order,through direct-order marketing.2Many firms use direct marketing to build long-term customer relationships by sending birthday cards, information, small premiums,or loyalty rewards to strengthen bonds over time.3

More marketers have turned to direct marketing in response to the high and increas-ing costs of reaching business markets through a sales force. Today companies spend $161billion annually on direct marketing, accounting for 10.3% of GDP.4 Direct sales includesales to the consumer market (53%), B2B (27%), and charitable fundraising (20%).5

The Benefits of Direct Marketing

Time-pressured customers appreciate the convenience, ease, and speed of orderingfrom home or office. Moreover, they can buy specialty items not available in local storesthrough direct marketing. Direct marketers benefit as well: They can buy mailing listsfor almost any segment (left-handed people, millionaires); customize and personalize

messages; build relationships; reach the most interested prospects at the right moment;easily test alternative media and messages; and easily measure campaign results.

Direct Mail

Direct-mail marketing involves sending an offer, announcement, reminder, or otheritem to a person. Using highly targeted mailing lists, direct marketers send out millionsof mail pieces each yearletters, flyers, and other salespeople with wings. Direct mailis popular because it permits target market selectivity, can be personalized, is flexible,and allows early testing and response measurement. Although the cost per thousandpeople reached is higher than with mass media, the people reached are better prospects.

In constructing a direct-mail campaign, marketers must decide on objectives,target markets, and prospects; offer elements; means of testing the campaign; andmeasures of campaign success.

Objectives.A campaigns success is judged by the response rate. An order-responserate of 2% is normally considered good (this number varies with product category

and price). Direct mail can also generate prospect leads, strengthen customer rela-

tionships, inform and educate customers, remind customers of offers, and reinforce

customer purchase decisions.

Target markets and prospects. Direct marketers apply the R-F-M formula (recency,frequency, monetary amount) to select customers according to how much time has

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304 Part VI Communicating Value

passed since their last purchase, how many times they have purchased, and how

much theyve spent as a customer. Marketers also identify prospects on the basis

of age, sex, income, education, and previous mail-order purchases; occasions;

and consumer lifestyle. In B2B direct marketing, the prospect is often a group of

people that includes decision makers and influencers.

Offer elements.The offer strategy consists of five elementstheproduct, the offer,

the medium, the distribution method, and the creative strategyall of which can betested.6 In addition, the marketer has to choose five components of the mailing itself:

the outside envelope, sales letter, circular, reply form, and reply envelope. Direct

mail can be followed up by e-mail, which is less expensive and less intrusive than

telemarketing.

Testing elements. One of the great advantages of direct marketing is the ability totest, under real marketplace conditions, elements such as products and features, copy

platform, mailer type, envelope, prices, and mailing lists. Response rates typically

understate a campaigns long-term impact; this is why some firms measure the impact

of direct marketing on awareness, intention to buy, and word of mouth.

Measuring success: lifetime value. By adding up the planned costs, the directmarketer can determine the needed break-even response rate (net of returnedmerchandise and bad debts). Even when a campaign fails to break even in the short

run, it can be profitable in the long run if customer lifetime value is factored in.

Calculate the average customer longevity, average customer annual expenditure,

and average gross margin, minus the average cost of customer acquisition and

maintenance (discounted for the opportunity cost of money).7

Catalog Marketing

In catalog marketing, companies may send full-line merchandise catalogs, specialty

consumer catalogs, and business catalogs, usually in print form but also sometimes asCDs, videos, or online. JCPenney sends consumers general merchandise catalogs;IKEA sends consumers furniture catalogs. Grainger sends industrial and office supplycatalogs to businesses. Many direct marketers have found that combining catalogs and

Web sites can be an effective way to sell.Catalogs are a huge businessabout 71% of U.S. consumers shop from home

using catalogs by phone, mail, and Internet.8 For successful catalog marketing, mar-keters manage customer lists carefully to minimize duplication and bad debts; controlinventory; offer quality goods so few items are returned; and project a distinctiveimage. Some companies add literary or information features, send swatches of materi-als, operate a special hot line to answer questions, send gifts to their best customers,

and donate some profits to good causes for social responsibility purposes.

Telemarketing

Telemarketingis the use of the telephone and call centers to attract prospects, sell toexisting customers, and provide service by taking orders and answering questions.Companies use call centers for inbound telemarketing(receiving calls from customers)and outbound telemarketing(initiating calls to prospects and customers). Effective tele-marketing depends on choosing the right telemarketers, training them well, and pro-

viding performance incentives.




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Although telemarketing is a major direct-marketing tool, its sometimes intrusivenature led to the Federal Trade Commissions establishment of a National Do Not CallRegistry. In the first four years, more than 140 million U.S. consumers registered to pre-

vent telemarketers from calling them at home. Only political organizations, charities,telephone surveyors, or firms with existing relationships with consumers are exempt.9

Other Media for Direct-Response MarketingDirect marketers use all the major media. Newspapers and magazines carry abundantprint ads offering books, clothing, vacations, and other goods and services that indi-

viduals can order via toll-free numbers. Radio ads present offers to listeners 24 hoursa day. Some companies have used 30- and 60-minute infomercials, commercials com-bining selling with information and entertainment, to present offers that are compli-cated, technologically advanced, or require a great deal of explanation. Marketers alsoreach consumers through at-home shopping television channels, taking orders on atoll-free number and delivering within 48 hours.

Public and Ethical Issues in Direct MarketingDirect marketers and their customers usually enjoy mutually rewarding relationships.Occasionally, however, a darker side emerges. Many people are irritated by hard-selldirect-marketing solicitations and computerized calls. Unscrupulous direct marketerstake advantage of impulsive, less sophisticated, or vulnerable consumers, especially theelderly.10 Some direct marketers create mailers and copy intended to mislead; theFederal Trade Commission receives thousands of complaints each year about fraudulentinvestment scams or phony charities. Critics worry about invasion of privacy, sayingmarketers may know too much about consumers. People in the direct-marketing indus-try have been addressing these issues. Most want what consumers want: honest, well-designed marketingoffers targeted only to those who appreciate hearing about the offer.

INTERACTIVE MARKETING

The newest channels for direct marketing are electronic. The Internet provides mar-keters and consumers with opportunities for much greater interaction andindividualization. Few campaigns are considered complete without a prominent onlinecomponent. Companies can send tailored messages that engage consumers by reflect-ing their special interests and behavior. The Internet is highly accountable and itseffects can be easily traced. Online advertisers can gauge response instantaneously bynoting how many unique visitors click on a page or ad, how long they spend with it,

where they go afterwards, and so on.11

The Web offers the advantage ofcontextual placementand buying ads on sites thatare related to the marketers offerings. Marketers can also place advertising based onkeywords from search engines, to reach people when theyve actually started the buy-ing process. And advertisers can use rich media ads that combine animation, video,and sound with interactive features.12

However, consumers can screen out most online advertising. Moreover, adver-tisers lose some control over what consumers do with online marketing messages andactivity. For example, consumers might place a marketers video in undesirable orunseemly places. Still, many feel the pros outweigh the cons, and the Web is attracting

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BREAKTHROUGH MARKETING: YAHOO!

Yahoo! has grown from a tiny upstart search engine to a powerful force inInternet media. Today the company proudly proclaims itself: The only placeanyone needs to go to find anything, communicate with anyone, or buy any-thing. Its wide range of Web services includes e-mail, news, weather, music,

photos, games, shopping, auctions, travel, and more. Users can personalize theexperience by creating a My Yahoo! page with features chosen from among thecompanys hundreds of content partners. Each month more than 475 millionpeople worldwide visit one of its myriad sites, with billions of page views per day.

Thanks to a database showing where its millions of registered users live andwhat their interests are, Yahoo! can present users with more relevant searchresults and more relevant advertising. And the Yahoo! Mobile Web service allowsadvertisers to reach consumers around the globe on their mobile phones. One ofthe first advertisers to participate was Pepsi. Weve had exceptional resultsreaching our consumers on Yahoo! online, notes John Vail, director of interac-tive marketing, Pepsi-Cola North America. Now we can reach consumers whentheyre on the move and communicate with them in a way we havent before.13

marketers of all kinds. Breakthrough Marketing: Yahoo describes that companysonline efforts.

Marketers must decide which forms of interactive marketing will be most cost-effective in achieving communication and sales objectives. Popular forms include:

Web sites.A key challenge is designing a site thats attractive on first viewing andinteresting enough to encourage repeat visits.14As shown in Table 17.1, Rayport

and Jaworski propose that effective Web sites feature the 7 Cs specific designelements.15And to bring visitors back again and again, marketers must embraceanother Cconstant change.16Visitors judge site performance based on ease of use(quick downloads, first page easy to understand, easy navigation) and physical

attractiveness (pages clean and not crammed, readable fonts and typefaces, good

use of color and sound).

TABLE 17.1 Elements of Effective Web Design

Design Element Description

Context Layout and design.Content Text, pictures, sound, and video on the site.

Community How the site enables user-to-user communication.

Customization Sites ability to tailor itself to different users or allow users to personalizethe site.

Communication How the site enables site-to-user, user-to-site, or two-way communication.

Connection Degree to which the site is linked to other sites.

Commerce Sites capabilities to enable commercial transactions.

Source: Jeffrey F. Rayport and Bernard J. Jaworski, E-Commerce (New York: McGraw-Hill, 2001), p. 116.




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Microsites.Amicrosite is a limited area on the Web, managed and paid for byan external advertiser/company, designed to supplement a primary site. Burger

Kings ad agency, for example, promoted the TenderCrisp sandwich with a microsite

featuring a subservient chicken, an actor in a chicken costume who seemed to

perform wacky actions such as playing air guitar, based on a users typed commands

(the moves were prerecorded). In the microsites first week, 54 million people

checked out the chicken.17 Search-related ads. Paid-searchor pay-per-click ads now represent 40% of all

online ads.18The search terms are a proxy for the consumers consumption interests

and trigger relevant links to product or service offerings alongside search results

from Google or other search sites. Advertisers pay only if people click on the links;

the cost depends on how high the link is ranked and the popularity of the keyword.19

One Samsung executive estimated it was 50 times cheaper to reach 1,000 people

online than on TV, so the firm shifted 10% of its advertising budget to the

Internet.20

Display ads. Display ads or banner ads are small, rectangular boxes containing

text and perhaps a picture that companies pay to place on relevant Web sites. Thelarger the audience, the more costly the placement. In the early days of the Internet,

viewers clicked on 2% to 3% of the banner ads they saw, but that percentage quickly

plummeted and advertisers began to explore other forms of communication.21 Still,

display ads can be useful if theyre attention-getting and influential, well targeted,

and closely tracked.22

Online videos and ads.With user-generated content sites like YouTube,MySpace Video, and Google Video, consumers and advertisers can upload ads and

videos to be shared virally by millions of people. Online videos, sometimes edgy, can

be a cost-effective way to reach large audiences.

Sponsorships.Many companies get their name on the Internet by paying to be

named as the sponsor of special content on Web sites that carry news, financialinformation, and so on. A popular vehicle for targeted sponsorship is podcasts,digital media files created for playback on portable MP3 players, laptops, or PCs.

Sponsors pay about $25 per thousand listeners to run a brief audio ad at the

beginning of the podcast.23

Alliances.When one Internet company works with another, they end up advertisingeach other through alliances and affiliate programs. AOL has created many successfulalliances. Amazon has almost 1 million affiliates that post its banners on their

Web sites.

Online communities.Many companies get useful, hard-to-get information by

sponsoring online communities where members communicate through postings,instant messaging, and chat discussions about special interests related to the

companys products and brands. Members of Krafts online community said they

wanted to control how much they ate, giving rise to 100-calorie bags and $100 million

in sales. Successful online communities create activities that encourage bonds

among community members.24

E-mail. E-mail campaigns cost a fraction of what d-mail, or direct mail, campaignscost. Microsoft used to spend about $70 million yearly on mail campaigns; now it

spends significantly less and still sends 20 million e-mails a month. However, many

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campaigns give customers a reason to respond, personalize the content, make offers

not available via direct mail, and allow customers to unsubscribe easily.25

Mobile marketing.Mobile ad spending was an estimated $871 million worldwidein 2006, most spent on text messages. Given the number of cell phones in use and the

ability to personalize messages based on demographics, the appeal of mobile marketing

is obvious; still, some wonder how consumers will react to ads on the third screen.26

WORD OF MOUTH

Social networks such as MySpace and FaceBook have become an important force inboth business-to-consumer and business-to-business marketing.27 A key aspect ofsocial networks is word of mouth and the number and nature of conversations and com-munications between different parties. Consumers talk about dozens of brands eachday. Although many are media and entertainment products like movies, TV shows,and publications, other offerings such as food products, travel services, and retailstores are often mentioned, as well.

Niche social networks offer access to targeted segments that are more likely tospread the brand message. Consider CafMom, started by CMI Marketing, with sev-eral thousand members who participate in dozens of forums for moms. When the sitestarted a forum for discussing developmentally appropriate play activities, toymakerPlayskool sent toy kits to 2,500 members and encouraged them to share their experi-ences with each other. The great thing is you get direct feedback from actual moms,says an executive at Hasbro, Playskools parent company.28

Buzz and Viral Marketing

Some marketers highlight two particular forms of word of mouthbuzz and viral

marketing.29

Buzz marketinggenerates excitement, creates publicity, and conveys newrelevant brand-related information through unexpected or even outrageous means.30

Viral marketingis another form of word of mouth, or word of mouse, that encour-ages consumers to pass along company-developed products and services or audio,

video, or written information to others online.31 Both try to showcase a brand and itsnoteworthy features by creating a splash in the marketplace.

Agencies have been created solely to help clients create buzz. P&G has 225,000teens enlisted in Tremor and 600,000 mothers enrolled in Vocalpoint. Both groupsare built on the premise that certain individuals want to learn about products, receivesamples and coupons, share their opinions with companies, and, of course, talk uptheir experiences with others. P&G chooses well-connected peoplethe Vocalpoint

moms have big social networks and generally speak to 25 to 30 other women duringthe day, compared to an average of five for other momsand their messages carry astrong reason to share product information with a friend.32 See Figure 17.1 forBzzAgents Word-of-Mouth Dos and Donts.

Opinion Leaders

Communication researchers propose a social-structure view of interpersonal commu-nication.33 They see society as consisting of cliques, small groups whose membersinteract frequently. Clique members are similar, and their closeness facilitates effective




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PAY WITH FEEDBACK

You dont need to pay cash to get someone to say something about your producttheyre alreadydoing it. Find a way to let your customers communicate with you, then listen to them and providethem real support and appreciation. Theyll volunteer to help a brand that lets them be part of theprocess.

INSIST ON OPENNESS

Campaign successand perhaps your companys reputation hinges on the openness of yourword-of-mouth participants. If youre creating an organized word-of-mouth program, require thatyour volunteers are aboveboard.

DEMAND HONESTY

If you listen closely, youll realize that honest opinions influence purchasing decisions more so thanquestionably positive opinions.

HELP CUSTOMERS TELL STORIES

Consumers place products in the context of their daily lives. If a runners footwear helps her set a

personal best in a marathon, she doesnt exclaim, Just do it! Rather, she talks about how thesneakers benefited her stride. In a word-of-mouth campaign for Levis Dockers, participantsdescribed the pride of being dressed sharply at social events. Provide your customers with tools tohelp them share their real stories more effectively.

DONT SCRIPT

For years marketers have delivered their messages as taglines that make every product soundperfect. Forcing word-of-mouth participants to repeat these messages is awkward and unnatural.

Worse still is asking participants to repeat a marketing script of a perfect opinion thats not theirown. Communicate the history, benefits, and unique attributes of your product to those who

volunteer to experience and discuss itand then get out of the way.

DONT PLAN

Word of mouth is a spontaneous event. It can happen at anytime or anywhereand yes, it can nothappen, even when you want it to. If you try to force word of mouth to take place when its notappropriate or comfortable, the result will no longer resemble real word of mouth. The key is tohelp people become more conscious of their opinions. Theyll share them when others are reallylistening.

DONT SELL

Odds are your company employs a trained and qualified sales force. Let them do their job andlet word-of-mouth volunteers do theirs. No one likes to be forcibly sold a product. We like to learnabout the pros and cons and then arrive at our own decision. Your word-of-mouth volunteers arenot salespeople. They are siblings, friends, coworkers, and accidental acquaintances.

DONT IGNORE

Listening to word of mouth about your product can be like a trip to the dentist: Its uncomfortablefor a moment, but the benefits last a lifetime. However difficult the feedback may be to hear, it iseven more powerful to incorporate. Honest word of mouth provides you with a unique opportunityto use real opinions as an incredible feedback loop; and the more you listen and perfect your prod-uct, the better your word of mouth will become.

FIGURE 17.1 BzzAgents Word-of-Mouth Dos and Donts

Source: Dave Balter, Rules of the Game,Advertising Age Point(December 2005): 2223.

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communication but also insulates the clique from new ideas. The challenge is to cre-ate more openness so that cliques exchange information with others in the society.

This openness is helped by people who function as liaisons and connect two or morecliques without belonging to either, and bridges, people who belong to one clique andare linked to a person in another.

Author Malcolm Gladwell sees three factors working to ignite public interest in

an idea.34The first is reaching the three types of people who can spread an idea like anepidemic: mavens, knowledgeable people; connectors,who know and communicate withmany others; and salesmen, who possess natural persuasive power. Any idea thatcatches the interest of mavens, connectors, and salesmen is likely to be broadcast farand wide. The second factor is stickiness, expressing an idea so it motivates peopleto act. The third, the power of context, controls whether those spreading an idea areable to organize groups and communities around it. Marketing Skills: How to Start aBuzz Fire discusses the skill of generating buzz.

Blogs

Blogs, regularly updated online journals or diaries, have become an important outletfor word of mouth because they bring together people with common interests. Someare personal for close friends and families, while others are designed to reach andinfluence a vast audience. Blog networks such as Gawker Media offer marketers aportfolio of choices. Online celebrity gossip blog PopSugar has spawned other blogson fashion (FabSugar), fitness (FitSugar), and humor (GiggleSugar), attractingcollege-educated women aged 18 to 44 making more than $60,000.35

Corporations such as Ford are creating their own blogs and carefully monitor-ing those of others.36 Especially popular blogs are creating influential opinion leaders.Bloggers at the Treehugger site track green consumer products, offering video and

MARKETING SKILLS: HOW TO START A BUZZ FIRE

Although many word-of-mouth effects are beyond a companys control, mar-keters can develop their skills to improve the likelihood of starting a positivebuzz. The first step is to identify influential individuals and companies and devoteextra attention to them. Next, supply these key people with product samples toencourage word of mouth. Also cultivate contacts with community influentialssuch as local radio personalities, class presidents, and heads of local organizations.Develop word of mouth referral channels to build business. Finally, provide com-

pelling information that people want to pass alonginformation thats originaland useful.

Several television networks are generating buzz using Twitter, a social-networking site that draws a young audience. Twitters special appeal is the abilityto send very short messages via e-mail, instant messaging, or posted on Twitters

Web page. MTV promoted the MTV Music Awards and the MTV Video MusicAwards using Twitter messages sent by MTV personalities as they walked the redcarpet. CW is also looking at ways to get buzz going through Twitter. Its execu-tive vice president of marketing stresses that the messages must . . . be of value.It cant be just watch Gossip Girl at 9. Its got to be more fun.37




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reference guides in frequent posts.38Yet consumers may still see information fromcorporate Web sites or professional review sites such as Edmunds.com as moretrustworthy.39

Measuring the Effects of Word of Mouth40

Marketers are exploring various measures to capture word-of-mouth effects. Researchand consulting firm Keller Fay notes that although 80% of word of mouth occurs off-line, many marketers focus on easy-to-track online effects. When Intuit measured the

viral success of its jackrabbit.intuit.com site for small business owners, it identifiedblogs that either picked up stories from influential bloggers given a special preview orthat carried their own stories. Intuit classified each blog according to velocity (whetherit took a month or happened in a few days),share of voice (how much talk occurred inthe blogosphere), voice quality (what was said and how positive or negative it was) and

sentiment(how meaningful the comments were).

PERSONAL SELLING AND THE SALES FORCEThe original and oldest form of direct marketing is the field sales call. Today mostindustrial firms rely heavily on a professional sales force to locate prospects, developthem into customers, and grow the business; or they hire manufacturers representa-tives and agents to carry out the direct-selling task. In addition, consumer companiessuch as Avon, Allstate, and Tupperware use a direct-selling force. U.S. firms spendover a trillion dollars annually on sales forces and sales force materialsmore than onany other promotional method. Nearly 12% of the total workforce works full-time insales occupations, in nonprofit as well as for-profit organizations.41 Hospitals andmuseums, for example, use fundraisers to solicit donations.

The term sales representative covers six positions, ranging from the least to themost creative types of selling:42

1. Deliverer.A salesperson whose major task is the delivery of a product (water, fuel).2. Order taker.An inside order taker (behind a counter) or outside order taker (calling

on supermarket managers).

3. Missionary.A salesperson not expected or permitted to take an order but rather tobuild goodwill or educate users (the medical detailer representing a pharmaceuti-cal firm).

4. Technician.A salesperson with a high level of technical knowledge (the engineeringsalesperson who is primarily a consultant to client companies).

5. Demand creator. A salesperson who relies on creative methods for selling tangibleproducts (vacuum cleaners or siding) or intangibles (insurance or education).

6. Solution vendor.A salesperson whose expertise lies in solving a customers problem,often with a system of the firms goods and services (such as computer systems).

Personal Selling and Relationship Marketing

The best salespeople have more than instinct; theyre trained in methods of analysis,customer management, and the principles of personal selling so theyre active ordergetters, not passive order takers. The major steps involved in any effective salesprocess are shown in Table 17.2.43

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Although the principles of personal selling may be applied in a transaction situ-

ation to close a specific sale, often the company wants to build a long-termsuppliercustomer relationship. Todays customers prefer suppliers who can sell anddeliver a coordinated set of products and services to many locations, quickly solveproblems in different locations, and work closely with customer teams to improveproducts and processes. Reps should monitor key accounts, know customers prob-lems, and be ready to serve them in a number of ways. They must be adaptive andrespond to different customer needs or situations.44

With a properly implemented relationship management program, the firm beginsto focus as much on managing its customers as on managing its products. However, rela-tionship marketing is not effective in all situations. Ultimately, companies must judge

which segments and customers will respond profitably to relationship management.

Designing the Sales Force

Companies are sensitive to the high and rising costs of maintaining a sales force(including salaries, commissions, bonuses, travel expenses, and benefits). Because theaverage cost of a personal sales call ranges from $200 to $300, and closing a sale typi-cally requires four calls, the total cost of a sale can range from $800 to $1,200.45 Notsurprisingly, companies are trying to increase the productivity of the sales forcethrough better selection, training, supervision, motivation, and compensation. Figure 17.2shows the basic steps in designing a sales force.

TABLE 17.2 Major Steps in Effective Selling

Sales Step Application in Industrial Selling

Prospecting and qualifying Firms generate leads and then qualify them by mail or phone to assess level of interest andfinancial capacity. Hot prospects are turned over to the field sales force; warm prospectsreceive telemarketing follow-up.

Preapproach The sales rep researches what the prospect needs, who is involved in buying decisions, andthe buyers personal characteristics and buying styles. The rep also sets call objectives toqualify the prospect, gather information, or make an immediate sale; decides whether to

visit, call, or write; plans the timing of the approach; and sets an overall sales strategy.

Presentation and The rep tells the product story to the buyer, using afeatures, advantages, benefits, anddemonstration value approach. Reps should guard against spending too much time on product features

(product orientation) and not enough on benefits and value (customer orientation).

Overcoming objections Salespeople must handle objections posed by customers during the presentation or whenasked for the order. Here, the rep must maintain a positive approach, ask for clarification, askquestions that lead the buyer to answer his or her own objection, deny the validity of theobjection, or turn objection into a reason for buying.

Closing Attempting to close the sale, the rep can ask for the order, recapitulate points of agreement,offer to help write up the order, ask whether the buyer wants A or B, get the buyer to make

minor choices such as color or size, or show what the buyer will lose by not ordering now.The rep might offer the buyer an inducement to close, such as a special price or a token gift.

Follow-up and maintenance To ensure customer satisfaction and repeat business, the rep should cement details suchas delivery time and purchase terms immediately after closing. Also, the rep should schedulea follow-up call to check on proper installation and training after delivery. This helps detectproblems, shows interest, and reduces any cognitive dissonance. Further, each account needsa maintenance and growth plan.




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Designing thesales force

Sales forceobjectives

Sales forcestrategy

Sales forcestructure

Sales forcecompensation

Sales forcesize

FIGURE 17.2 Designing a Sales Force

Sales Force Objectives and Strategy

Companies need to define specific sales force objectives. For example, a companymight want its sales representatives to spend 80% of their time with current customersand 20% with prospects, and 85% of their time on established products and 15% onnew products. Salespeople perform one or more of the following tasks: prospecting(for prospects or leads); targeting (allocating time among prospects and customers);communicating (information about the companys offerings); selling (approaching,

presenting, overcoming objections, and closing sales); servicing (consulting on prob-lems, rendering technical assistance, arranging financing, expediting delivery); infor-mation gathering (market research, market intelligence); and allocating (deciding

which customers will get scarce products during shortages).Todays sales representatives act as account managers, arranging fruitful con-

tact among people in the buying and selling organizations. Increasingly, effective salesrequires teamwork and the support of other personnel, such as top management, espe-cially when national accounts or major sales are at stake; technical people, who supplytechnical information and service to customers; customer service representatives, whoprovide installation, maintenance, and other services; and an office staff of sales ana-lysts, order expediters, and assistants.

Once the company decides on an approach, it can use either a direct or contrac-tual sales force. Adirect (company) sales force consists of full- or part-time paidemployees who work exclusively for the firm. Inside sales personnel conduct businessfrom the office (using the telephone, fax, and e-mail) and receive visits from prospec-tive buyers; field sales personnel travel and visit customers. Acontractual sales forceconsists of manufacturers reps, sales agents, and brokers who earn a commissionbased on sales.

Sales Force Structure

The sales force strategy has implications for sales force structure. A company that sells

one product line to one end-using industry with customers in many locations woulduse a territorial structure. A company that sells many products to many types of cus-tomers might need a product or market structure. Some firms need a more complexstructure. Motorola, for example, has four types of sales forces: (1) a strategic marketsales force of technical, applications, and quality engineers and service personnel formajor accounts; (2) a geographic sales force calling on customers in different territo-ries; (3) a distributor sales force calling on and coaching Motorola distributors; and(4) an inside sales force doing telemarketing and taking orders by phone and fax.

Companies typically single out major accounts (also called key accounts, nationalaccounts, global accounts, or house accounts) for special attention. The largest accounts

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may have a strategic account management team with cross-functional personnel tocover all aspects of the relationships. For example, Procter & Gamble has a 300-personstrategic account team stationed at Wal-Marts Bentonville, Arkansas, headquarters.46

Sales Force Size

After the company determines the sales force strategy and structure, it is ready toestablish the sales force size, based on the number of customers it wants to reach. Onemethod is the five-step workload approach: (1) group customers into size classes byannual sales volume; (2) establish call frequencies (number of calls on an account per

year) for each customer class; (3) multiply the number of accounts in each size class bythe call frequency to arrive at the total workload, in sales calls per year; (4) determinethe average number of calls a sales rep can make per year; and (5) divide the totalannual calls (calculated in step 3) by the average annual calls made by a rep (in step 4)to see how many reps are needed.

Suppose the firm has 1,000 A accounts and 2,000 B accounts; A accounts require36 calls a year (36,000 calls yearly), and B accounts require 12 calls a year (24,000

calls). This company needs a sales force that can make 60,000 sales calls a year. If theaverage rep can make 1,000 calls a year, the company would need 60 representatives.

Sales Force Compensation

To attract top-quality sales reps, the company needs an attractive compensation package.The four components of sales force compensation are a fixed amount, a variable amount,expense allowances, and benefits. Thefixed amount, a salary, is intended to satisfy theneed for income stability. The variable amount, which might be commissions, a bonus, orprofit sharing, is intended to stimulate and reward greater effort. Expense allowancesenable sales reps to meet the expenses involved in travel and entertaining. Benefits, such as

paid vacations and life insurance, provide security and job satisfaction.Fixed compensation receives more emphasis in jobs with a high ratio of non-selling to selling duties and when the selling task is technically complex and requiresteamwork. Variable compensation works where sales are cyclical or depend on indi-

vidual initiative. Fixed and variable compensation give rise to three basic types ofcompensation plansstraight salary, straight commission, and combination salary andcommission. One survey revealed that more than half of sales reps receive at least 40%of their compensation in variable pay.47

Straight-salary plans provide sales reps with a secure income, make them morewilling to perform nonselling activities, and give them less incentive to overstockcustomers. These plans are easy to administer and they lower turnover. Straight-

commission plans attract higher sales performers, provide more motivation, requireless supervision, and control selling costs; however, they emphasize getting the saleover building the relationship. Combination plans offer the benefits of both plans

while reducing their disadvantages.

MANAGING THE SALES FORCE

Sales force management covers the steps in recruiting and selecting, training, super-vising, motivating, and evaluating representatives (see Figure 17.3).




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Managing thesales force

Recruiting andselecting salesrepresentatives

Trainingsales

representatives

Supervisingsales

representatives

Motivatingsales

representatives

Evaluatingsales

representatives

FIGURE 17.3 Managing the Sales Force

Recruiting and Selecting Sales Representatives

At the heart of any successful sales force is the selection of effective representatives.One survey revealed that the top 27% of the sales force brought in over 52% of thesales. Conversely, its a great waste to hire the wrong people. The average annualturnover rate for all industries is almost 20%. Turnover leads to lost sales, costs offinding and training replacements, and a strain on existing salespeople to pick upthe slack. Numerous studies have shown little relationship between sales perfor-

mance on one hand, and background and experience variables, current status,lifestyle, attitude, personality, and skills on the other. More effective predictorshave been composite tests and assessment centers that simulate the workingenvironment.48

After management develops selection criteria, the next step is to recruit appli-cants by soliciting names from current sales reps, using employment agencies, placing

job ads, and contacting college students. Selection procedures can vary from an infor-mal interview to prolonged testing and interviewing. Although test scores are onlyone information element in a set that includes personal characteristics, references,past employment history, and interviewer reactions, they are weighted quite heavilyby some companies. Gillette says that tests have reduced turnover and scores corre-

lated well with the progress of new reps.

Training and Supervising Sales Representatives

Todays customers expect salespeople to have deep product knowledge, add ideas toimprove the customers operations, and be efficient and reliable. This requires compa-nies to make a much higher investment in sales training. New reps may spend a few

weeks to several months in training. The median training period is 28 weeks in indus-trial-products companies, 12 in service companies, and 4 in consumer-productscompanies. Training time and method varies with the complexity of the selling taskand the type of person recruited for sales. Training may involve role-playing, audio-

and videotapes, CD-ROMs, and distance learning. Altera, which makes reprogram-mable chips, has invested in personality testing to form the right sales teams andempathy training to help reps better understand customers problems.49

Companies vary in how closely they supervise sales reps. Reps paid mostly oncommission generally receive less supervision. Those who are salaried and must coverdefinite accounts are likely to receive substantial supervision. With multilevel selling,used by Avon and others, independent distributors are also in charge of their own salesforce selling company products. These independent contractors or reps are paid acommission not only on their own sales, but also on the sales of people they recruitand train.50

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Sales Rep Productivity

How many calls should a company make on a particular account each year? Someresearch suggests that sales reps spend too much time selling to smaller, less profitableaccounts when they should focus on larger, more profitable accounts.51Therefore,companies often specify how much time reps should spend prospecting for new

accounts. Spector Freight wants its reps to spend 25% of their time prospecting andstop calling on a prospect after three unsuccessful calls. Some firms rely on a mission-ary sales force to open new accounts.

The best sales reps manage their time efficiently. Time-and-duty analysishelpsreps understand how they spend their time and how they might increase their produc-tivity. In general, sales reps spend time planning, traveling, waiting, selling, and inadministrative tasks (report writing and billing, attending sales meetings, and talkingto others in the company about production, delivery, billing, sales performance, andother matters). No wonder face-to-face selling time amounts to as little as 29% oftotal working time!52

To cut costs, reduce time demands on their outside sales force, and take advan-

tage of computer and telecommunications innovations, many firms have increased thesize and responsibilities of their inside sales force. Inside salespeople are of threetypes. Technical support people provide technical data and answer customers questions.Sales assistantsprovide clerical backup for outside reps by confirming appointments,checking credit, following up on deliveries, and answering customers questions.Telemarketersfind new leads, qualify them, and sell to them.

The company Web site is a valuable tool for reps, especially for prospecting.Company Web sites can help define the firms relationships with individual accountsand identify those whose business warrants a personal sales call. The site can providean introduction to self-identified potential customers and might even receive the ini-tial order. For more complex transactions, the site provides a way for buyers to contact

the seller. Selling over the Internet supports relationship marketing by solving prob-lems that dont require live intervention so reps can spend more time on issues bestaddressed face-to-face.

Motivating Sales Representatives

The majority of sales representatives require encouragement and special incentives,especially those in field selling.53Most marketers believe that the higher the salesper-sons motivation, the greater the effort and the resulting performance, rewards, andsatisfactionall of which further motivation. Marketers reinforce performance withintrinsic and extrinsic rewards of all types. One study found that the sales reward with

the highest value was pay, followed by promotion, personalgrowth, and sense of accom-plishment.54The least-valued rewards were liking and respect, security, and recognition.In other words, salespeople are highly motivated by pay and the chance to get ahead andsatisfy their intrinsic needs, and less motivated by compliments and security.

Many firms set annual sales quotas for dollar sales, unit volume, margin, sellingeffort or activity, and product type. Compensation is often tied to degree of quota ful-fillment. Sales quotas are developed from the annual marketing plan. Managementfirst prepares a sales forecast that becomes the basis for planning production, work-force size, and financial requirements. Then the firm can establish quotas for regionsand territories,often setting the totalhigher than the sales forecast to encourage managers




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and salespeople to perform at their best. If they fail to make their quotas, the firmmight still make its sales forecast.

Each area sales manager divides the areas quota among its sales reps. A repsquota can be set high to spur extra effort or more modestly to build confidence. Onegeneral view is that a salespersons quota should be at least equal to the persons last

years sales, plus some fraction of the difference between territory sales potential and

last years sales. The more favorably the salesperson reacts to pressure, the higher thefraction should be.

Evaluating Sales Representatives

We have been describing thefeed-forwardaspects of sales supervisionhow manage-ment communicates what sales reps should be doing and motivates them to do it.However, good feed-forward requires good feedback, which means getting regularinformation from reps to evaluate their performance. Information about reps cancome from sales reports, self-reports, personal observation, customer letters andcomplaints, customer surveys, and conversations with other sales reps. Many firms

require their reps to develop an annual territory marketing plan for developing newaccounts and increasing business from existing accounts.Sales reps write up completed activities on call reportsand, in addition, submit

expense reports, new-business reports, lost-business reports, and reports on local con-ditions. These reports provide raw data from which sales managers can check salesperformance: (1) average number of sales calls per rep per day; (2) average sales calltime per contact; (3) average revenue per sales call; (4) average cost per sales call;(5) entertainment cost per sales call; (6) percentage of orders per hundred sales calls;(7) number of new customers per period; (8) number of lost customers per period; and(9) sales force cost as a percentage of total sales.

Sales reports, along with other observations, supply the raw materials for evalu-

ation. There are several approaches to conducting evaluations. One type of evaluationcompares current performance to past performance. These comparisons help man-agement pinpoint specific areas for improvement. For example, if a reps average grossprofit per customer is lower than the companys average, that rep could be concentrat-ing on the wrong customers or not spending enough time with each customer. A repsperformance can be related to both internal factors (effort, ability, and strategy) andexternal factors (task and luck).55

EXECUTIVE SUMMARY

Direct marketing is the use of consumer-direct channels to reach and deliver goodsand services to customers without marketing intermediaries. Direct marketers plancampaigns by deciding on objectives, target markets and prospects, offers, and prices;then they test and establish measures to determine success. Major channels for directmarketing include face-to-face selling, direct mail, catalog marketing, telemarketing,television, kiosks, Web sites, and mobile devices. Interactive marketing offers moreopportunities for dialogue and individualization through well-designed Web sites, as

well as online ads, promotions, and other approaches. Two notable forms of word-of-mouth marketing are buzz marketing, which gets people talking about a brand byensuring that the offer or how it is marketed is out of the ordinary, and viral marketing,

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which encourages people to exchange online information related in some way to aproduct or service.

Designing the sales force requires decisions about objectives, strategy, structure,size, and compensation. There are five steps to managing the sales force: (1) recruitingand selecting representatives; (2) training representatives in sales techniques and inthe companys products, policies, and customer-satisfaction orientation; (3) supervis-

ing the sales force and helping reps use their time efficiently; (4) motivating the salesforce and balancing quotas, monetary rewards, and supplementary motivators; and(5) evaluating individual and group sales performance. Personal selling entails sixsteps: (1) prospecting and qualifying; (2) preapproach; (3) presentation and demon-stration; (4) overcoming objections; (5) closing; (6) follow-up and maintenance.Relationship marketing is often an important part of personal selling.

1. Brian Morrissey, Why Some Brands Seem Anti-Social,Adweek,August 27, 2007, http://www.adweek.com/aw/magazine/article_display.jsp?vnu_content_id1003627780; Kamau High, Happiness Is . . .Coca-Cola in Second Life,Adweek.com,August 16,2007, www.adweek.com; Andrew Martin, Does CokeNeed a Refill?New York Times,May 27, 2007, sec. 3,pp. 1ff; Kenneth Hein, Cokes Web Formula Is a

Work in Progress, Brandweek, September 4, 2006,p. 9; Coke.com Finds Its Inner YouTube,Adweek,

July 10, 2006, p. 7.2. The terms direct-order marketingand direct-

relationship marketingwere suggested as subsetsof direct marketing by Stan Rapp and Tom Collinsin The Great Marketing Turnaround(Upper SaddleRiver, NJ: Prentice Hall, 1990).

3. Ran Kivetz and Itamar Simonson, Earningthe Right to Indulge: Effort as a Determinantof Customer Preferences Toward FrequencyProgram Rewards,Journal of Marketing Research 39(May 2002): 155170; Ran Kivetz andItamar Simonson, The Idiosyncratic FitHeuristic: Effort Advantage as a Determinant ofConsumer Response to Loyalty Programs,

Journal of Marketing Research 40 (November 2003):454467.

4. DMAs 2006 Power of Direct MarketingReports, Direct Marketing Association, June 5, 2007;Carol Krol, Direct Hits It Big, B to B, October 10,2005, pp. 2931; Direct Marketings Growth Rateto Cushion Cooling U.S. Economy, Direct

Marketing Association, October 17, 2006.5. Figures supplied byDirect Marketing Magazine,

phone 516-716-6700.

6. Edward L. Nash, Direct Marketing:Strategy, Planning, Execution, 4th ed. (New York:

McGraw-Hill, 2000).7. The average customer longevity (N) is related to the

customer retention rate (CR). Suppose the companyretains 80% of its customers each year. Then theaverage customer longevity is given by:

N 1/(1 CR) 1/.2 5.8. Lorie Grant, Niche Catalogs Unique Gifts Make

Money Less of an Object, USA Today, November20, 2003, p. 3B; Olivia Barker, Catalogs AreComplementary with Online Sales, Purchases,USA Today, December 4, 2002, p. 4E.

9. Ryan Kim, Telemarketers Getting Through,San Francisco Chronicle,April 16, 2007, p. C1;

www.ftc.gov.10. Charles Duhigg, Telemarketing Thieves

Sharpen Their Focus on the Elderly,New York Times,May 20, 2007.

11. Emily Steel, Advertisings Brave New World, WallStreet Journal, May 25, 2007, pp. B1, B3; Johnnie L.Roberts, How to Count Eyeballs,Newsweek,November 27, 2006, p. 42.

12. Daniel Michaels and J. Lynn Lunsford, Ad-SalesWoes Likely to Continue, Wall Street Journal,December 4, 2006, p. B6; Byron Acohido, Rich

Media Enriching PC Ads, USA Today, February 25,2004, p. 3B

13. Olga Kharif, AOLs Mobile Ambitions,BusinessWeek Online, September 27, 2007,

www.businessweek.com/technology; CatherineHolahan, Yahoos Bid to Think Small,BusinessWeek, February 26, 2007, p. 94; Kevin J.Delaney, As Yahoo Falters, Executives Memo Calls

NOTES




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for Overhaul, Wall Street Journal, November 18,2006; Justin Hibbard, How Yahoo! Gave Itself aFace-lift, BusinessWeek, October 9, 2006, pp. 7477;Yahoo!s Personality Crisis, The Economist, August13, 2005, pp. 4950; Fred Vogelstein, YahoosBrilliant Solution,Fortune, August 8, 2005,pp. 4255; Ben Elgin, Yahoos Boulevard of BrokenDreams, Business Week, March 13, 2006, pp. 7677.

14. Peter J. Danaher, Guy W. Mullarkey, and SkanderEssegaier, Factors Affecting Web Site VisitDuration: A Cross-Domain Analysis,Journal of

Marketing Research 43 (May 2006): 182914.15. Jeffrey F. Rayport and Bernard J. Jaworski,

E-Commerce (New York: McGraw-Hill, 2001), p. 116.16. Bob Tedeschi, E-Commerce Report,New York

Times,June 24, 2002, p. C8.17. Allison Fass, A Kingdom Seeks Magic,Forbes,

October 16, 2006, pp. 6870; David Kiley, The

Craziest Ad Guys in America, BusinessWeek, May22, 2006, pp. 72-80; www.subservientchicken.com.18. Prime Clicking Time, The Economist,May 31,

2003, p. 65; Ben Elgin, Search Engines ArePicking Up Steam, BusinessWeek,March 24, 2003,pp. 8687.

19. Global Click-Through Rates Level Off in 2004After Year of Decline,New Media Age, November25, 2004, p. 10; Ned Desmond, Googles NextRunaway Success, Business 2.0, November 2002,p. 73.

20. Heather Green, Online Ads Take Off Again,

BusinessWeek,May 5, 2003, p. 75.21. Puneet Manchanda, Jean-Pierre Dub, Khim Yong

Goh, and Pradeep K. Chintagunta, The Effects ofBanner Advertising on Internet Purchasing,

Journal of Marketing Research 43 (February 2006):98108; Pay Per Sale, The Economist, October 1,2005, p. 62.

22. Paul Sloan, The Quest for the Perfect Online Ad,Business 2.0, March 2007, pp. 8893; CatherineHolahan, The Promise of Online Display Ads,BusinessWeek, May 1, 2007.

23. Heather Green, Searching for the Pod of Gold,BusinessWeek, November 14, 2005, pp. 8890.

24. Heather Green, It Takes a Web Village,BusinessWeek, September 4, 2006, p. 66; PaulDwyer, Measuring the Value of Word of Mouthand Its Impact in Consumer Communities, MSIReport No. 06-118,Marketing Science Institute,Cambridge, MA.

25. Seth Godin, Permission Marketing: Turning Strangersinto Friends and Friends into Customers(New York:Simon & Schuster, 1999).

26. Amol Sharma, Companies Vie for Ad Dollars onMobile Web, Wall Street Journal, January 17, 2007,pp. A1, A17; Amol Sharma, T-Mobile Readies New

Web Phones and Hangs Up on a Star Pitchwoman,Wall Street Journal, September 26, 2006, pp, B1, B6.

27. For a thorough review of relevant academicliterature see Christophe Van Den Bulte and Stefan

Wuyts, Social Networks and Marketing, MarketingScience Institute Relevant Knowledge Series,Cambridge, MA, 2007.

28. Brian Morrisey, Niche Social Networks OfferTarget Practice,Adweek, April 9, 2007, p. 11.

29. Dave Balter and John Butman, Clutter Cutter,Marketing Management, July/August 2006,pp. 4950.

30. Emanuel Rosen, The Anatomy of Buzz (New York:Doubleday Currency, 2000).

31. Rosen, The Anatomy of Buzz, ch. 12; Viral

Marketing, Sales & Marketing Automation(November 1999): 1214; George Silverman,The Secrets of Word-of-Mouth Marketing(New York:

Amacom, 2001).32. Robert Berner, I Sold It Through the Grapevine,

BusinessWeek, May 29, 2006, pp. 3234.33. Peter H. Riengen and Jerome B. Kernan, Analysis

of Referral Networks in Marketing: Methods andIllustration,Journal of Marketing Research(November 1986): 3778; J. Johnson Brown andPeter Reingen, Social Ties and Word-of-MouthReferral Behavior,Journal of Consumer Research 14

(1987): 350362; Jacqueline Johnson Brown, PeterM. Reingen, and Everett M. Rogers, Diffusion ofInnovations, 4th ed. (New York: The Free Press,1995).

34. Malcolm Gladwell, The Tipping Point: How LittleThings Can Make a Big Difference (Boston: Little,Brown & Company, 2000).

35. Claire Cain Miller, The Sweet Spot,Forbes, April23, 2007, p. 41.

36. David Kiley, Ford on the Web, Warts and All,BusinessWeek, October 30, 2006, pp. 6871.

37. Stephanie Kang and Suzanne Vranica, NetworksTry Twittering to Spread Their Message, WallStreet Journal,July 16, 2007, p. B2; Sarit Moldovan,

Jacob Goldenberg, and Amitava Chattopadhyay,What Drives Word of Mouth? The Roles ofProduct Originality and Usefulness,MSI Report

No. 06-111, (Cambridge, MA: Marketing ScienceInstitute, 2006); Karen J. Bannan, Online Chat Is aGrapevine That Yields Precious Fruit,New YorkTimes, December 25, 2006; John Batelle, The Netof Influence, Business 2.0,March 2004, p. 70;

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Malcolm Macalister Hall, Selling by Stealth,Business Life, November 2001, pp. 5155; Ann

Meyer, Word-of-Mouth Marketing Speaks Wellfor Small Business, Chicago Tribune,July 28, 2003.

38. Heather Green, The Big Shots of Blogdom,BusinessWeek, May 7, 2007.

39. Todd Wasserman, Report: Consumers Dont TrustBlogs, Brandweek, September 4, 2006, p. 10. For anacademic discussion of chat rooms, recommendationsites, and online customer review sections, seeDina Mayzlin, Promotional Chat on the Internet,

Marketing Science 25 (March-April 2006):155163 and Judith Chevalier and Dina Mayzlin,The Effect of Word of Mouth on Sales: OnlineBook Reviews,Journal of Marketing

Research 43 (August 2006): 345354.40. This section is based on an excellent summary,

Is There a Reliable Way to Measure Word-of-

Mouth Marketing,Marketing NPV, Vol. 3, Issue 3,2006, pp. 39 available at www.marketingnpv.com.41. http://www.bls.gov/oco/reprints/ocor012.pdf.42. Adapted from Robert N. McMurry, The Mystique

of Super-Salesmanship,Harvard Business Review(MarchApril 1961): 114. Also see William C.

Moncrief III, Selling Activity and Sales PositionTaxonomies for Industrial Salesforces,Journal ofMarketing Research (August 1986): 261270.

43. Some of this discussion of personal selling is basedon W. J. E. Crissy, William H. Cunningham, andIsabella C. M. Cunningham, Selling: The Personal

Force in Marketing(New York: John Wiley, 1977),pp. 119129.

44. George R. Franke and Jeong-Eun Park,Salesperson Adaptive Selling Behavior andCustomer Orientation: A Meta-Analysis,Journal of

Marketing Research 43 (November 2006): 693702;Richard G. McFarland, Goutam N. Challagalla, and

Tasadduq A. Shervani, Influence Tactics forEffective Adaptive Selling,Journal of Marketing70(October 2006): 103117.

45. Bill Keenan, Cost-per-call Data Deserve Scrutiny,Industry Week,January 10, 2000.

46. Clare Doyle, Brad McPhee, and Ian Harris,Marketing, Sales, and Major Account

Management: Managing Enterprise Customers as aPortfolio of Opportunities, talk at MarketingScience InstitutesMarketing, Sales, and Customersconference, December 7, 2005; Noel Capon,Key

Account Management and Planning(New York: FreePress, 2001); Sallie Sherman, Joseph Sperry, andSamuel Reese, The Seven Keys to Managing Strategic

Accounts(New York: McGraw-Hill Trade, 2003);

Jack Neff, Bentonville or Bust,Advertising Age,February 24, 2003.

47. Sales Performance Benchmarks, Go-to-MarketStrategies, June 5, 2007.

48. Sonke Albers, Salesforce ManagementCompensation, Motivation, Selection, and

Training, inHandbook of Marketing, edited byBart Weitz and Robin Wensley (London: SagePublications, 2002), pp. 248266.

49. Cliff Edwards, Death of a Pushy Salesman,BusinessWeek, July 3, 2006, pp. 108109.

50. Nanette Byrnes, Avon CallingLots of NewReps, BusinessWeek,June 2, 2003, pp. 5354.

51. Michael R. W. Bommer, Brian F. ONeil, andBeheruz N. Sethna, A Methodology forOptimizing Selling Time of Salespersons,Journalof Marketing Theory and Practice (Spring 1994):6175. See also Lissan Joseph, On the Optimality

of Delegating Pricing Authority to the Sales Force,Journal of Marketing65 (January 2001): 6270.52. Dartnell Corporation, 30th Sales Force

Compensation Survey. Other breakdowns show that12.7% is spent in service calls, 16% inadministrative tasks, 25.1% in telephone selling, and17.4% in waiting/traveling.

53. Willem Verbeke and Richard P. Bagozzi, Sales CallAnxiety: Exploring What It Means When FearRules a Sales Encounter,Journal of Marketing64(July 2000): 88101.

54. Eric G. Harris, John C. Mowen, and Tom J.

Brown, Re-examining Salesperson GoalOrientations: Personality Influencers, CustomerOrientation and Work Satisfaction,Journalof the Academy of Marketing Science 33 (1), 2005:1935; Gilbert A. Churchill, Jr., Neil M. Ford,and Orville C. Walker, Jr., Sales Force Management:Planning, Implementation and Control, 4th ed.(Homewood, IL: Irwin, 1993). Also see JhinukChowdhury, The Motivational Impact of SalesQuotas on Effort,Journal of Marketing Research(February 1993): 2841; Murali K. Mantrala,Prabhakant Sinha, and Andris A. Zoltners,Structuring a Multiproduct Sales Quota-BonusPlan for a Heterogeneous Sales Force: A Practical

Model-Based Approach,Marketing Science 13,no. 2 (1994): 121144; Wujin Chu, EitanGerstner, and James D. Hess, Costs and Benefitsof Hard-Sell,Journal of Marketing Research(February 1995): 97102; Manfred Krafft, AnEmpirical Investigation of the Antecedents ofSales Force Control Systems,Journal of

Marketing63 ( July 1999): 120134.




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55. Philip M. Posdakoff and Scott B. MacKenzie,Organizational Citizenship Behaviors and SalesUnit Effectiveness,Journal of Marketing Research(August 1994): 351363. See also, Andrea L. Dixon,Rosann L. Spiro, and Magbul Jamil, Successful andUnsuccessful Sales Calls: Measuring Salesperson

Attributions and Behavioral Intentions,Journal ofMarketing65 (July 2001): 6478; Willem Verbekeand Richard P. Bagozzi, Sales Call Anxiety:Exploring What It Means When Fear Rules a SalesEncounter,Journal of Marketing64 ( July 2000):88101.

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