Global Marketing

WARREN J. KEEGAN MARK C. GREEN Ninth

Edition,Global Edition

Global Marketing Communications Decisions II:

Sales Promotion, Personal Selling, and Special Forms of Marketing Communication
Chapter 14
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Ltd.
 Learning Objectives
1. Define sales promotion and identify the most important
promotion tactics and tools used by global marketers.
2. List the steps in the strategic/ consultative selling model.
3. Explain the contingency factors that must be considered
when making decisions about sales force nationality.
4. Explain direct marketing’s advantages and identify the
most common types of direct marketing channels.
5. Identify special forms of marketing communication and
explain how global marketers integrate them into the
overall promotion mix.

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 Sales Promotion
• Sales promotion refers
to any paid consumer or
trade communication
program of limited
duration that adds
tangible value to a
product or brand
– Price vs. non-price
promotions
– Consumer vs. trade Axe Apollo featured astronaut Buzz
Aldrin in promoting a free trip to
promotions space for 22 lucky winners.
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 Sales Promotion
• Provide a tangible incentive to buyers
• Reduce the perceived risk associated with
purchasing a product
• Provide accountability for communications
activity
• Provide method of collecting additional data
for database

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Sales Promotion: Global or Local
• In countries with low levels of economic
development, low incomes limit the range of
promotional tools available
• Market maturity can also be different from
country to country
• Local perceptions of a particular promotional tool
or program can vary
• Local regulations may rule out use of a particular
promotion in certain countries
• Trade structure in the retailing industry can affect
the use of sales promotions
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 Sampling
• Sampling
– Provides consumer with opportunity to try product
at no cost
– May be distributed in stores, in the mail, through
print media, at events, or door-to-door
– Kikkoman soy sauce launched a sampling program
in supermarkets in the U.S.; today the U.S.
contributes 85% of profit from international
operations

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 Couponing
• Couponing
– Printed certificates entitle the bearer to a price
reduction or some other special consideration
for purchasing a particular product
• Couponing accounts for 70% of consumer
promotion spending in the U.S.
• Free-standing inserts, in-pack, on-pack, cross
coupons

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 Social Couponing
• Hot online trend
• Groupon is industry leader
– Deals are made with local retailers with Groupon
taking a percentage of proceeds
– Grown from 1 country to 35 mainly through
acquisition
– 40 million users in 48 global markets by 2012
– Over 50% of users are in Europe, 33% in U.S.
– Founders rejected Google’s $6 billion takeover
offer
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Sales Promotions

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 Sales Promotion:
Issues and Problems
• Fraud
– Pepsi promotion with Apple
• Regulations vary by country
• Cultural dispositions to coupons and other sales
promotions
– Malaysians see coupon usage as embarrassing
– Islam frowns on gambling so sweepstakes may not
work

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 Personal Selling
• Person-to-person communication
between a company representative and
a prospective buyer
• Focus is to inform and persuade
prospect
• Short-term goal: make a sale
• Long-term goal: build a relationship

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 Personal Selling Hurdles
• Political Risks – unstable or corrupt governments
change the rules for the sales team
• Regulatory Hurdles – Governments can set up
quotas or tariffs that affect the sales force
• Currency Fluctuations – increase and decrease in
local currencies can make certain products
unaffordable
• Market Unknowns – lack of knowledge of market
conditions, the accepted way of doing business, or
positioning of the product may derail the sales
team’s efforts

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The Strategic/Consultative Selling Model
Evolved in response to:
• Increased competition
• More complex products
• More emphasis on
customer needs
• Long-term relationships

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The Strategic/Consultative Selling Model
• Personal Selling Philosophy – commitment to the
marketing concept and a willingness to adopt the
role of problem solver/partner
• Relationship Strategy – game plan for establishing
and maintaining high-quality relationships with
prospects/customers
• Product Strategy – plan that can assist the sales
representative in selecting and positioning
products to satisfy customer needs

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The Strategic/Consultative Selling Model
• Customer Strategy – plan that ensures that
the sales professional will be maximally
responsive to customer needs
• Presentation Strategy – consists of setting
objectives for each sales call and establishing
a presentation plan to meet those objectives

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The Strategic/Consultative Selling Model

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 The Presentation Plan
• Approach
• Presentation
• Demonstration
• Negotiation
• Close
• Servicing the sale

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 Approach & Presentation
Approach Presentation
• Initial contact with the • Prospect’s needs are
customer/ prospect assessed and matched
• Must completely to the company’s
understand the products
decision-making • The style and message
process and the roles of of the presentation
each participant must be tailored to the
audience

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 Demonstration & Negotiation
Demonstration Negotiation
• Salesperson has the • Ensures that both the
opportunity to tailor the customer and the
communication effort to salesperson come away
the customer from the presentation
• Can show how the winners
product can meet the
customer’s needs

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 Close & Servicing the Sale
Close Servicing the Sale
• Ask for the sale • To ensure customer
satisfaction
• Must be culturally
– Implementation process
sensitive must be outlined
– Customer service
program established

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 Sales Force Nationality
• Expatriates
• Host-country nationals
• Third-country nationals
• Other options

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 Expatriates
• Advantages • Disadvantages
– Superior product – Higher cost
knowledge – Higher turnover
– Demonstrated – Cost for language
commitment to and cross-cultural
service standards training
– Train for promotion
– Greater HQ control

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 Host-Country Nationals
Advantages Disadvantages
– Economical – Needs product
– Superior market training
knowledge – May be held in low
– Language skills esteem
– Language skills may
– Superior cultural
not be important
knowledge
– Difficult to ensure
– Fast implementation loyalty
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 Third-Country Nationals
• Advantages • Disadvantages
– Cultural sensitivity – May face
– Language skills identification
problems
– Economical – May be blocked for
– Allows regional sales promotions
coverage – Income gaps
– Needs product and/or
company training
– Loyalty not assured
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 Other Options
• Sales agents
• Exclusive license arrangements
• Contract manufacturing or
production
• Management-only agreements
• Joint ventures

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Special Forms of Marketing Communications
• Direct Marketing
– Direct mail
– Catalogs
– Infomercials, teleshopping
• Event Sponsorship
– Concerts, sporting events
– Product placement in movies
• Internet Communications

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 Direct Marketing
• Any communication with a consumer or
business recipient that is designed to
generate a response in the form of:
– An order
– Request for further information
– A visit to a store or other place of business

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 One-to-One Marketing
• Building from Customer Relationship
Management
– Identify customers and accumulate detailed
information about them
– Differentiate customers and rank them in terms
of their value to the company
– Interact with customers and develop more cost
efficient and effective forms of interaction
– Customize the product/service offered to the
customer
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Direct Marketing vs. Mass Marketing

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Advice for U.S. Direct Marketers Going Global
• The world is full of people who are not Americans. Be
sure not to treat them like they are.
• Like politics, all marketing is local. Just because your
direct mail campaign worked in Texas, do not assume
it will work in Toronto.
• Although there may be a European Union, there is no
such thing as a "European."
• Pick your target, focus on one country, and do your
homework.
• Customers need to be able to return products locally
or at least believe there are services available in their
country.
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 Direct Mail
• A vehicle for delivering a personally addressed
offer to a prospect targeted by a marketer
• Popular with banks, insurance co., other
financial service providers
• U.S. direct mail lists are easy to rent; Europe
and Japan lists are lower in quality
• Germans spend the most, $500 per capita, in
mail-order shopping
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 Catalogs
• Catalog: magazine-style
publication that features
photographs, illustrations, and
extensive information about a
company’s products
• U.S. 1/3 of world market, 17
billion mailed in 2008
• EU: Elimination of barriers has
led to a boom
• Hong Kong and Singapore have
efficient postal systems and highly
German supermodel Yvonne educated consumers with credit
Catterfeld with Otto Catalog cards
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Infomercials and Teleshopping
• An infomercial is a form of paid TV in which a
particular product is demonstrated, explained,
and offered for sale to viewers who call a toll-free
number on the screen
• In Asia, infomercials make $100s of millions in
sales. Low penetration rates of private phones,
credit cards & delivery issues create difficulties
• Teleshopping on channels like HSN and QVC is
exclusively devoted to demonstration and selling
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 Interactive Television
• ITV allows viewers to interact with the
programming content they are viewing
• In the U.K., more than half of pay-TV
subscribers use ITV
• Remote controls have buttons to push to
order products shown on screen

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 Outdoor Ad Spending as a
Percentage of Total Ad Spending

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 Sponsorships
• A company pays a fee to be associated
with an event, team, athletic association,
or sports facility
• Combines elements of PR and sales
promotion
• Draws media attention

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 Product Placement
• Arranging to have the company’s products
and brand names appear in TV shows,
movies, and other types of entertainment
• Marketers also lend or donate products to
celebrities and other public figures
• Issue for Marketers: Once seen in a movie,
products cannot be easily adapted to
meet local market needs
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