Sales Marketing

Elements of Selling-Chain Infrastructure

Product Catalogs and Marketing Encyclopedia

For assisted selling, a valuable tool is a marketing encyclopedia, an intelligent electronic catalog that connects sales representatives and customers to a company’s most current product and service information. It provides a single point of entry for harnessing and distributing all product information. Product managers can update information in the database and immediately broadcast the changes throughout the enterprise. Some critical requirements of any marketing encyclopedia are the ability to easily create and maintain a repository of product information; the ability to create multiple search mechanisms to assist in location information; and the ability to alert sales representatives and customers to bundled products and services, promotions, and complementary products.

Sales Configuration Systems

In many companies, the process of selling configurable or customized products is cumbersome at best. From the time a sales quotation is prepared, through product manufacturing and shipment, requirements must be captured and configuration questions must be accurately answered. Salespeople (either direct or channel partners) are forced to “check with the home office” because they lack the tools and information they need to provide accurate and complete configuration quotes in the field.

Modern configurators are designed to go beyond checking configuration to embracing the needs of the customer, enabling a sales force to generate requirements-based, accurate configurations and quotes at the point of sale, whether it’s in front of the customer or over the Web.

Pricing Maintenance, Distribution, and Configuration

Selling complex products requires effective pricing strategy support. Pricing varies by the sales strategy, such as tiered customer hierarchies, multiple distribution channels, varying product lines, “effectivity” dates, and authorization ranges. Because of these and many more issues, a new sales configuration type has emerged: pricing configuration. Pricing configuration and update management assists companies as they develop, manage, and deploy complex pricing and discounting structures to selling channels.

Proposal and Quote Generation

The goal of proposal and quote generation systems is to enable companies to provide an intuitive, professional layout to customers who require complex quotes.

Such applications include the following features:

  • Opportunity Creation/Tracking. This enables salespeople to organize, locate, and restore versions of existing quotes and configurations by customer, session, or date.

  • Interactive needs assessment. This enables salespeople and customers to articulate their buying criteria and solution requirements.

  • Automatic quote generation. This generates quotes directly from the sales configuration, with the ability to add spare parts, apply custom discounting, select currency type, apply special charges or discounts based on geography, and affix special shipping and packaging charges.

  • Proposal Wizard. This automatically generates tailored proposals from configurations, needs assessments, and quotes, reducing the time and effort required to generate custom proposals.

Sales Incentives and Commission Processing

Commission systems have three core modules: incentive design, inventive processing, and incentive analysis. From an incentive design standpoint, systems need to enable a company to:

  • Create sophisticated commission and bonus rules that reward salespersons based on different sales credit points, including booking, shipping, and payment.

  • Create individualized and account compensation programs using an unlimited number of commissions, bonuses, and quotas.

  • Create and use customized performance measures, including profit margin, net discount, and customer satisfaction.

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Managing Order Acquisition Process

The process of order acquisition entails performing needs assessment; facilitating option selection; performing configuration; and generating a quote and proposal, complete with drawings, schematics, and performance metrics.

The technical sales specialist then transfers his or her understanding of the solution into production terms, such as price and delivery schedules, or passes the technical information to someone else who figures out the pricing and manufacturing schedule. The information is then either given back to the salesperson or to a proposal specialist, who creates a complex document recapping the customer’s needs and proposing the manufacturer’s best product configuration, price, delivery date, and other relevant terms. This manual process leaves a great deal of information (e.g., engineering, pricing, and manufacturing issues) up to individual interpretation. The likelihood of human error in the process is high and the cycle time is long.

Ask yourself, What does my sales process look like? The first step toward creating applications that provide strategic differentiation is to map the customer’s entire experience with the sales order process. We recommend that companies perform this exercise for each important customer segment. The begin, assemble groups from all areas of your company, in particular those who use marketing data and those who have face-to-face or phone contact with customers. Charge the groups with identifying, for each major market segment, all the steps through which customers pass from the time they become aware of your product to the time the order is entered into the system.

Specific industries may increasingly need selling-chain automation for different reasons, but corporations worldwide are turning to these solutions as they look to gain and use more intimate knowledge about their customers in the order acquisition process. It’s simply easier for any company to sell when the sales team is equipped with comprehensive information about customers and can demonstrate their ability to respond quickly to customers’ possible needs or concerns.

Sometimes reengineering the entire order acquisition process may be very difficult. In such cases, it makes sense to optimize the elements that are causing the most grief.

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Rise in Attrition:Is Work Culture Responsible?

Where causes of increased attrition in organisations are concerned, issues like remuneration or work atmosphere are slowly being replaced by external factors as the cause for increased attrition as the economy transforms itself into a services-oriented one. What are these? What should a manager do to overcome these? To understand such issues, read the following article.

Coporatescape
A highly qualified management graduate from one of India’s reputed institutes was always overlooked during promotions at a leading Engineering firm. He rarely accompanied his colleagues on their weekend recreation activities.
A gifted copywriter bid goodbye to a satisfying advertising job because she was treated like a pariah. She always refused offers to accompany her colleagues for movies and dinners.

A talented market researcher, who had a bright career ahead of him, left a very good job with a leading firm because he could not blend with the other employees. He was from a small town and the others were socialites.

Welcome to the actual world where work culture has got more to do with what happens outside the workspace and less within.

History
Organisations are made or broken depending on what they consider priorities. While profitability fuelled ambitions in the fifties, quality determined fate in the seventies, the customer was king in the eighties and employees are now acknowledged as an organisation’s true assets.

Today one can see a change in the mindset of organisations with respect to employee relationship management with organisations across the world conducting employee satisfaction surveys regularly. Among other parameters of evaluation, work culture has begun to play a major role in determining employee satisfaction.

Surprisingly, today, compensation and rewards are no longer the bones of contention. Rather issues such as ‘Work culture’ determine the level of comfort an employee experiences and this in turn determines the strength of loyalty and commitment. It influences the decision of the employee while recommending the company to a prospect. In simple terms it determines whether working in that organisation is a pleasure or a pain.

Definitions & manifestations – the whats and how’s of work culture
A host of terms could be used to describe work culture – camaraderie, teamwork, cooperation, coordination and so on. All these definitions are not only right but also underline the contemporary definition of work culture.

The eagerness with which team members work with each other; the smoothness with which colleagues adapt to each other’s work styles; the ease with which contentious issues are prevented or addressed are all instances of work culture in practice.
While what ‘work culture’ embodies and how it is defined is to a large extent subject to individual assessment, what can be unanimously accepted is that ‘Work culture’ is acknowledged as a parameter with far-reaching effects on employee morale and company image.

‘Work culture’ – Hygiene factor or Motivation factor?
At this juncture, it would really be worth considering where ‘Work culture’ figures in Fredrick Herzberg’s Hygiene and Motivation Factor theory. Hygiene factors are those whose absence lead to dissatisfaction and results in lack of motivation among employees. Herzberg lists company policies, administration, working conditions, interpersonal relations, salary and security as hygiene factors. It is easy to see that presence of hygiene factors only ensures that employees are not dissatisfied. Presence of hygiene factors does not necessarily ensure delight or motivation among employees. Common motivation factors on the other hand are those whose presence result in motivated employees. Motivation factors are achievement, recognition, additional responsibility and growth. Presence of motivation factors in the absence of hygiene factors could yet result in dissatisfaction.

From what we understand about ‘work culture’, it is clearly a hygiene factor, a factor, which to reiterate is fundamental in (hygiene) that it determines the level of satisfaction among employees, a factor, which if is not monitored and managed can lead to disastrous consequences with regard to employee morale and loyalty.

Metamorphosis of workspaces
The last few decades have been witness to changes in organisational structure and group dynamics. Typical hierarchical structures were modified and the emergence of ‘flat’ organisations became the norm. Top management became more approachable and accessible to the lower rungs of the pecking order. Management and leadership discarded the disciplinarian ‘Captain William Bligh of HMS Bounty’ approach and adopted a milder ‘Captain Ricky Ponting’ approach. ‘Sirs’ and ‘Ma’ams’ gave way to first-name addresses. The way we work today would surely give the aristocratic stiff- upper- lip British a shock.

Suddenly teamwork is no longer an eight-letter word relegated to the depths of HR textbooks, it has witnessed a paradigm shift in the way group dynamics was being evaluated and measured. The focus has gradually shifted from being result oriented to effort oriented and employee interaction has risen in precedence.

This emphasis on teamwork has had an impact on various functions of the company such as recruitment and employee performance evaluation.

A worker today is evaluated more in terms of whether he ‘belongs’ as against whether he ‘delivers’…

Work environment dynamics more than ever before are being set at the cigarette shop across the street and not at the work desk… Team ‘spirit’ is being measured more in terms of the participation at the local pub and less in terms of a worker’s eagerness to get done with the job and go home early…

A quick survey among professionals in Mumbai, Bangalore and Delhi has shown that ‘hanging out’ and ‘chilling out’ is no longer college speak. These are popular means of getting along well with one’s colleagues and accepted means of advancing one’s career in a firm.
This phenomenon is increasingly being observed in India’s fastest growing sector – the Service Industry. Call centres, Advertising agencies, Media houses, Consultancies, Software companies are only a few of the plethora of companies that have been afflicted with the “corporate peer pressure”. Even in traditional industries such as Manufacturing, Sales and Marketing the management cadre is highly prone to this unfortunate syndrome.

Dictums for the Future
Without doubt, today it is very clear that office culture is increasingly being defined and evaluated outside the office. Teamwork and teamwork-spirit are losing their significance with respect to job duties and responsibilities alone. What are the questions facing corporates now?

  • Can they afford to lose qualified employees who don’t ‘belong’ to the culture of their colleagues?
  • Should corporates alienate capable and skilled colleagues who are incapable of socialising?

There is a need to study this phenomenon to ascertain its gravity. There is a need to take a fresh look at the new group dynamics that have entered the work place. What then, should the roles of new managers be?

Managers today would have to ensure that the college student mentality stays where it belongs and doesn’t enter the workplace. While it is always welcome to make the office a refreshing, interesting and lively place to be in, managers have to set the limits of informality and be able to differentiate between and redefine key result areas and productivity parameters.

Managers need to understand that there will still be some individuals who will continue working despite this issue. What needs to be analysed is to what extent is this loyalty dictated by helplessness and lack of other options and to what extent does job satisfaction rule the decision to stay. While it is clear how the former is detrimental to the organisation’s interest, managers need to pause and give a thought about how much longer a star employee will put up with the stress to “belong”.

The last word
The difficulty is of course understandable in getting along with introverts and recluses. But it would be criminal to force a colleague to ‘blend in’ in the name of being a ‘sport’. It is acknowledged that given the demands of the workplace and the stress that comes along with them, one would like to relax and unwind at the end of the day. But it would be unfair to assume that every employee would prefer to unwind in the same collective way. It is accepted that colleagues would like to socialise. But it would be unjust to compel someone to make an attempt to ‘belong’.

Many a hand would go up, many a voice would be raised in protest to the above statements. Many readers would disagree that they compelled an unwilling elitist colleague. Probably they are right. But the fact remains that once a colleague declines, for the rest of his stay in the office, the behaviour of others should not always be driven by his decision.

It is here that tomorrow’s managers have to step in and ensure that efficient employees are not being isolated and condemned by their teammates. Managers have to see to it that the ‘day after’ (a party or a movie), a non-participating employee is still treated as before – and that is on the basis of his performance in office and not outside it.

Finally, there is an old adage that says ‘all work and no play makes Jack a dull boy’. But there are lot of skilled Jacks who would like to play alone. There are many efficient Jacks out there who would like to play with their families. There are many more sincere Jacks who have a life beyond the place of their livelihood. These Jacks need to be respected and allowed to be. These Jacks need to be respected and accepted as what they are – thorough professionals.

In the name of group dynamics, corporates should not end up compromising on productivity attributable to the attrition of a thorough professional who simply couldn’t fit in. Or else corporates should institutionalise formalised fora for interaction and exchange of thoughts and bonding.

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Branding In India: Pre And Post Liberalisation

Branding truly arrived in India in the 1990s, when we as a nation took our first steps towards liberalisation under the aegis of Dr. Manmohan Singh and Narasimha Rao. True, we had the Liril Girl and Surf’s Lalithaji, but barring these two iconic ‘ladies’ one can hardly recall any sustained activity in brand building. There were numerous reasons for this. Before the 90s, our market was supply driven which did not necessitate the sustained creation of brands. Branding is essential in a market where the consumer has choice; where variety dominates and grocery shelves are cluttered with options. For example, if I want to purchase a shampoo today, not only do I have about 30 odd brands to choose from, I also have variants for shiny hair, dandruff prevention, hair loss arrest, soft hair, volume etc. Till the early 80s, if I wanted a shampoo, the only option I had was either a bar of shikakai soap or a brand called Tiara. If I wanted to purchase a lipstick, I had two choices – Tips & Toes or Lakme, unlike today, where I have at least 10 choices of brands and another 25 odd variants in exclusion of imported brands.

Differentiating one’s product from others was not required on two counts:

a. there were hardly a couple of other manufacturers, and;
b. everyone sold what they produced.

Before liberalisation, we purchased what was available and waited for our wants to get fulfilled. If we wanted a scooter, we filled out a form, deposited the money and waited a good year for our scooter to land at our doorstep. For banking or financial services, we only had the nationalised banks and for LPG, laid-back government agencies. In other words, given the minimum levels of competition, companies were almost assured of a sale, not only for the immediate financial quarter but also for the distant future. Making the market aware of the product and making it available to the consumers were the only significant marketing activities.

Brand-building expenses in such an environment would understandably be tough to justify.
Competition creates brands. In the 80’s, when Nirma stormed the detergent market and took away significant market share from Hindustan Lever’s Surf, “Lalithaji” and the tagline “Surf ki kharidari may hi samajhadari hai” was born. The jingle “Pura adha kilo Surf ek kilo sasate powder ke barabar hai,” clearly stated the difference between the two brands in terms of their efficacy. Nirma on the other hand differentiated itself from Surf by saying that it had mass appeal, “Sabki pasand Nirma”. For the first time, value versus price was discussed by detergent brands in India.

Another significant milestone that India witnessed as branding took its roots in the market was the Pepsi launch. Pepsi started out with a teaser campaign, i.e., a girl in an Indian dress who’s face was partially hidden by a hat, with a very catchy background score urging the audience to wait for the dawn of a particular day. The teaser was shot in shades of dark grey and black, which added to the mystery. The amount of interest that the teaser generated was something to be experienced. And finally on the promised day, the full advertisement ran revealing the girl to be Juhi Chawla who drank deeply of the Pepsi bottle after an energetic dance announcing to India that Pepsi had arrived.

Suddenly manufacturers found themselves facing a complex market:

a. many manufacturers offering similar products to satisfy the same need in consumers.
b. A highly fragmented media making it difficult to understand who was watching what.

The complexity made it tricky for manufacturers to understand the market. Suddenly, the conservatives were out of business, the rules had changed. From supply, the market was now being driven by demand. The splintered media was making it difficult to reach one’s target audience. The stage was set for the dream merchants or brand managers to make their entry.

Brand management differs from sales. If brand management is about creating preference or demand, sales is about converting preference to actual purchase. What is important to note is that if preference is not created, conversion cannot take place.

How is preference created? There are many ways, a few of which are described below:

i. Building myths around brands:
Lalithaji and the Liril girl are classic cases of brand myths. In both these cases, the characters create a drama, which make the audience identify with the benefits the brand has to offer. Myths can be built around occasions such as the current Cadbury’s commercial (eat it for celebrations) or childhood memories such as Vicks Vaporub (shows a mother caring for her son who is suffering from a cold).

Two factors fuelled the growth of brands and branding in India in the late 80s and 90s. One was of course globalisation, but the other was the satellite television revolution. Before the invasion of Kuwait by Iraq in 1990s, India had never experienced the magic of real time television programming as delivered by cable networks. And once Indian audiences experienced it, there was no looking back and the satellite television exploded on the media scene. From one national channel to 40 channels was but one small step.

ii. Cultivating strong and addictive brand image:
David Ogilvy, the advertising guru, believed that people purchased images and not products. While talking about whiskey, he said that people when given a blind taste test could not pick out their favourite brand of whiskey. This meant that people did not choose a brand for its taste but rather for the image it connoted. Hence, whiskey companies were actually selling an image rather than a product! This test has been carried out with the Colas as well with the same result.

iii. Target marketing:

Using consumer research, brand managers try to answer one question: “Who is the consumer?” They try and describe the person demographically (age, gender, income, education etc.), psychographically (attitude, lifestyle, values), behaviourally (what, where, how, how often etc.) and geographically (where does he or she live, region, city location etc.). Once they have a complete description of the target consumer, they state the product attributes in the context of the consumer. For example, the Hinglish used in Pepsi’s “Dil Mange More” is the language of India’s urban well-to-do college-going youth.

Brand Management is the fulcrum on which India’s post liberalisation market rests. The brand manager is supposed to manage this highly complex and competitive market. He or she creates demand for the brand. For example, the brand manager of Pepsi is charged with the job to make you and me long to drink Pepsi when we feel thirsty. In other words, if someone wants to purchase a motorcycle, it is the job of Bajaj Auto’s brand manager to see that the prospective buyer prefers to purchase a Bajaj motorcycle.

iv. Appropriating the image of a celebrity to the brand:
When Kareena Kapoor endorses Lux Body Wash (Style your body), Lux appropriates for itself the qualities of Kareena Kapoor. Priety Zinta transfers her zest to TVS Scooty.

The Indian market has come of age as it takes on the commendable characteristics of healthy competition. Branding is entering all sorts of non traditional sectors such as cement, fibre optics, banking and financial services, construction and even political parties.

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The Boston Box

The Boston Box, created by the Boston consulting group, classifies products according to their market share and potential for market growth. It is often used by management to help decide on the appropriate product range.

BCG Growth-Share Matrix

High Market Share

High Market Growth

Low Market Growth

Stars

Cash Cows

Low Market Share

Problem Children

Dog

  • Stars are high-growth, high share businesses or products. They often need heavy investment to finance their rapid growth.

  • Cash cows are low-growth, high-share businesses or products, but will still need marketing to maintain its portion of the market.

  • Problem Children are low-share business units in high-growth markets. It will probably require intensive advertising.

  • Dogs are low-growth, low-share businesses and products which are probably making a loss and should be dropped from the product range.

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The Product Life Cycle

    • Product development begins when the company finds and develops a new-product idea. During product development, sales are zero and the company’s investment costs mount.

    • Pre-introduction phase: involves research and development activity and general planning prior to the launch of a new product.

    • Introduction is a period of slow sales growth as the product is being introduced in the market. This is the most expensive stage in the history of the product. The costs of research, both technical and marketing, have to be borne, the product is not yet contributing revenue to the business and there is the risk of failure. Profits are non-existent in this stage because of the heavy expenses of product Introduction phase: involves limited distribution and an emphasis on awareness in promotional activity. Price can be pitched either at a relatively low level to gain maximum adoption of the new product in the shortest possible time, or at a relatively high, premium level, to cream off the benefits of having a superior new product.

    • Growth is a period of rapid market acceptance and increasing profits. The product is establishing itself in the market and sales are increasing over time. maximizing sales and market; emergence of new competitors; price more competitive; product differentiation—new brands and product; advertising emphasizes mass communication while distribution emphasizes reaching out extensively as far as possible.

    • Maturity is a period of slowdown in sales growth because the product has achieved acceptance by most potential buyers. At this stage, competition increases as rival firms fight for a bigger share of the market. Profits level off or decline because of increased marketing outlays to defend the product against competition. Increase advertising and sale promotions. market development and product development.

    • Decline is the period when sales fall off and profits drop. maximizing sales and market; emergence of new competitors; price more competitive; product differentiation—new brands and product; advertising emphasizes mass communication while distribution emphasizes reaching out extensively as far as possible.

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How to extend the Product Life Cycle

An organization with a range of products is likely to have them at different stages of the life cycle. It needs to recognize this because of the implications for the rest of the marketing mix. Also, because it is possible to extend the life of an established product beyond the maturity stage by means of an extension strategy. This needs to be based on carefully planned marketing and production decisions and could involve strategies for any or all of the following.

  • More frequent use of the product eg. Sales of Mars confectionery products in the summer were increased by ‘Cool Em’ in the fridge advertising; frozen turkeys are now sold throughout the year and not just at Christmas.

  • Finding new uses or markets for the product eg. Johnsons baby powder promoted to adults; electric shavers for ladies; exporting Scotch Whisky; shampoo for different hair types.

  • Modifying the product to retain its consumer appeal. This may involve changing its physical appearance, image or ingredients and relaunching it in new packaging on a regular basis, often with heavy promotional expenditure. For example, new styling or accessories such as central locking or electronic windows on cars, introducing new shoes and clothes as existing ones go out of fashion.

  • Technical developments for example, new packaging techniques can also bring about new market opportunities like the use of plastic bottles and wax cartons for milk, fruit juices and wine; ring-pull cans for beers and soft drinks. Likewise, the growth in the home freezer market and consequently frozen food means that many products such as meats can now be sold both fresh and frozen, whilst ice cream can be sold in larger quantities.

  • Wider product range. It may also be possible for a firm to introduce associated products or variations to its present range.

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