This was developed for Business Policy & Strategy at Portland State University. Most textbooks talk about channels from a conceptual standpoint. In this piece we expand the discussion to talk about B to B vs. B to C, sales funnels, and compensation. It could use a little more depth on types of retail stores if anyone has the content, would be happy to add it.

1. BA 495BA 495
Sales Channels
W

2. S i k i d lStrategic Marketing Model
The Offering
2

3. Place: Sales Channels
U d t d C t S i l R i tE i ti St thUnderstand Customer
& Buying Behavior
Special Requirements
Imposed by Product
Existing Strength
& Role of Brand
Maturity and Investment
Existing Channels
Channel
Channel Cost &
Selection
Channel Cost &
Margin Available
Supported
b P ti
Slide 3
by Promotion

4. Channels: Market Selection
B to G
B to BB to C
“E t i ” “SMB”
Slide 4
“Enterprise” or “SMB”

5. Consumer Markets Business Markets
Channels: Market Selection
Consumer Markets
• Demographic factors
• Socioeconomic factors
Business Markets
• Industry segments (SIC)
• Product segments• Socioeconomic factors
• Geographic factors
• Psychological factors
• Product segments
• Geographic segments
• Common buying factors• Psychological factors
• Consumption patterns
G t M k t
• Common buying factors
• Customer size segments
Government Markets
• Military/Aerospace
Federal Government
• Campaigns/Elections
5
• Federal Government • State/Local

6. B C Ch lB to C Channels*
Producer Consumer
Producer ConsumerRetailer
Producer ConsumerRetailerDistributor
Producer ConsumerRetailerWholesaler Distributor
Slide 6
* Different channels can be used for sales & fulfillment

7. B C Ch l
Direct
B to C Channels
Producer Consumer
Indirect
Producer ConsumerRetailer*
Indirect
Producer ConsumerRetailerDistributor
Producer ConsumerRetailerWholesaler Distributor
Slide 7
* Can take the form of a franchise like McDonald’s

8. B B/G Ch lB to B/G Channels
B to B
Producer Business
B to B B to B B to B
Producer BusinessRetailer*
Industrial
Distributor
Value Added Reseller(VAR)
Producer Business
Manufacturers
Rep
Systems Integrators
Producer Business
Manufacturers
Rep
Industrial
Distributor
Slide 8
* Non-traditional examples: Office Depot, UPS Store, FedEx Office, LazerQuick, …

9. B C I l d B B T iB to C Includes B to B Transactions
B to C
Producer Consumer
B to B B to B B to B
Producer ConsumerRetailer
B to B B to B B to B
Producer ConsumerRetailerDistributor
Producer ConsumerRetailerWholesaler Distributor
Slide 9

10. R il S lRetail Sales
Retail Store Selection
Retailer Consumer
Supermarket Full-Line Discount Specialty
General MerchandiseFood
Supercenter Category Specialist^ Department
Convenience
Company Store*
Drug Off-Price
Extreme ValueCompany Store*p y
Warehouse Club
p y
^ Includes “big box retailers” and “category killers”
10
* Company owned or franchise common in the fast food industry but can apply more broadly
Source: modified from Marketing, 2nd edition, Grewal, D., Levy, M., 2010

11. R il S lRetail Sales
Product/Brand Awareness
Retailer Consumer
signagesignage
inserts
coupons
Slide 11

12. P tiPromotion
“Push” vs. “Pull”
Create Awareness
and Demand
Supplier
P h
Demand
P llPush Pull
Proper “Mix”
Required
Build Channel
Activity
Slide 12

13. B B/G Ch l
• Indirect (“Channels”)
B to B/G Channels
• Indirect ( Channels )
• Direct Sales
Direct Sales Force (Traditional)– Direct Sales Force (Traditional)
– Internet (Disintermediation)
– Company StoreCompany Store
• Direct Response
– Direct MailDirect Mail
– Infomercials
– Catalogs…Cata ogs
Slide 13

14. iPromotion
Compliment Channel
Online
email
website newsletterradio
television
telesales
Offline
b
webinar
events
tradeshow
viral
affiliates
magazine
infomercial
promotion
discount
banner
social
media
blogs wiki
press
outdoor
direct
mail
yellow
pages
coupons
portal
directory
search
engine
auction articles
release
public
relations
mail pages
sports
word-of-mouth
Slide 14
engine articles
newspapermarketing

15. Di t S lDirect Sales
“Process” of (Consultative) Selling
SEO emailPPCdirect mail televisionPR web site
Offline Online
viralbanners
affiliates
telesales
print
radiooutdoor
infomercialcoupons auction
marketplace
social
and more….and more….
AIDA SalesAIDA
process
Sales
Funnel
Sales

16. Di S lDirect Sales
Sales “Team”
• Sales/Account Executive*
– “Hunters” vs. “Farmers”
– Commission vs. Quota
• Sales Engineer
Sales skills +– Sales skills +
– Technical skills
• Field Marketingg
• Product Marketing
• Sales Development
Slide 16
* Telesales can also serve as primary account executives

17. Di S lDirect Sales
Sales Compensation
over-quota
over-ride
bonus
i i
target
compensation
quota
over quota
driver:multiple commission
“at risk”
driver:
- sales
- units
- margin
multiple
quota’s
possible
base
- …
Slide 17
Lot’s of variations possible…

18. Di S lDirect Sales
Opportunity Ownership
Markets
Existing New
s
Existing Sales
Sales
Development
Products
Development
P
New Marketing
Business
Development
Slide 18

19. Di t S lDirect Sales
“Process” of Selling Stage
Prospect
DataMarketing
Stage
p
Opportunity
Qualified Lead
ership
Opportunity
Proposal
Owne
“Farm”
Sales
Client
Sales
“Hunt”
Farm
Product & Market Dependent

20. Di t S lDirect Sales
“Process” of Selling
Data
Depends on
Industry, Product,
and CustomerProspect
Qualified Lead
and Customer
Opportunity
Proposal
Sales
Cycle
Sales
Client
note: retail talks more about inventory “turns”

21. M k i SMarketing Support
Sales Tools
Prospect Stage
Messaging matrix
Marketing campaigns
Lead scoring
Support Each Stage in
The Sales Process
Lead scoring
Opportunity Stage
Sales presentation
Product demonstration
C titi l iCompetitive analysis
Objection handler
Proposal Stage
Price list
Quote template
Cost justification worksheet
Executive presentation
Client Stage
21
Client Stage
Periodic communication
New promotions
Sales

22. S l F i & MSales Forecasting & Management
ImplementationPlanning
Data 100%
Implementation
Promotion
Plan
Planning
Prospect
Qualified Lead
30%
10%
Lead
Scoring
Fi i l
Plan
Opportunity
Proposal
5%
2%
Financial
Model
Sales
Proposal
Client
2%
2%Sales
Forecast
C t R l ti hi M tCustomer Relationship Management
(CRM) software commonly used today

23. S l F i & MSales Forecasting & Management
Lead Scoring
• Rank Opportunities
– Product Need
– Existing Budget
– Purchase Timeline
A i R k B d A ti• Assign Rank-Based Actions
A: Need, Budget, 30-day Close …… “Hot” - Focus
B: Need Budget NurtureB: Need, Budget …… Nurture
C: Need …… Inform

24. Direct Response
ROI Driven
The Offer
20%
Response
Recipe20% Recipe
ROI Driven
LCV FocusLCV Focus
The List
70% The Creative70% The Creative
10%

25. Ch l S l iChannel Selection
Other Considerations
• Product Complexity
– Shrink Wrap
C l t i Ch l– Complete in Channel
– Custom Solution
• Product Price/Margin• Product Price/Margin
– High Price Increases Perceived Risk
– Direct Sales Expensive Channel
– Channel Layers Add Cost
• Sales Cycle
Slide 25

26. Ch l C fliChannel Conflict
Competition “IN” Channel
Consumer
Internet
ConsumerBest BuyWholesaler Distributor
HP
ConsumerCostco
ConsumerSafewayWholesaler Distributor
P&G
Slide 26

27. l h l kMulti-Channel Marketing
Cisco Systemsy
27
Source: Marketing of High-technology Products and Innovations, Mohr, Jakki J., Sanjit
Sengupta, and Stanley F. Slater, Chapter 9, Page 316

28. l h l kMulti-Channel Marketing
Online Enterprise
Lead
Generators
Postcards
Call Lists
p
Qualified
Leads
Sign-ups
Viral
Marketing
Orders
Quotes
Jobs
Quotes
Business
Development
Affiliates
Account
Management OperationsMarketing
Google Adwords
Production
Facilities
Small $$
Accounts
Web
Google Adwords
Online Affiliates
Promotions
Newsletter
SEO
Web
Site
Small Business
Orders