Unit 3.pptx

Sales Planning and Control
3
3.1. Sales Planning
3.2. Sales Control
3.3. Sales Audit
3.4. Specialized Techiniques in Selling

Introduction
 Every successful business needs a plan. It makes no difference if it is just starting
out or already established.
 Sales and sales management is no different. A sales organization, including the
salesperson, should employ a plan of action, or sales strategy.
 This plan includes the setting of goals and deciding which strategies and tactics
to use to reach them.
 It is crucial that the sales planning be done carefully.
 If it is not, its impact will ultimately affect the selling process negatively.

Sales Planning
3.
1
In today’s increasingly competitive market, a company’s survival depends upon the
commitment of the sales force to stay customer- focused, improve productivity, and
achieve the firm’s goals. The selling picture has been changing rapidly; what was
previously a local market has now become national or even global.
A) Sales Forecasting:
A sales forecast is an estimate of sales, in dollars or physical units, in a future
period under a particular marketing program and an assumed set of economic and
other factors outside the unit for which the forecast is made.
A sales forecast may be for a single product or for an entire product line. No sales
forecasting method is foolproof – each is subject to some error. Some methods are
unsophisticated, such as the jury of executive opinion or the poll of sales force
opinion.
Others involve the application of sophisticated statistical techniques, such as
regression analysis or econometric model building and simulation.

Sales Planning
3.
1
Sales Forecasting Methods:
A sales forecasting method is a procedure for estimating how much of a given
product (or product line) can be sold if a given marketing program is implemented.
No sales forecasting method is foolproof – each is subject to some error.

Sales Planning
3.1
Sales Forecasting Methods:
1) Qualitative Forecasting Methods:
a) Jury of Executive Opinion:
There are two steps in this method:
 High-ranking executives estimate probable sales, and
 An average estimate is calculated.
Reasons of using Jury of Executive Opinion Method:
 This is a quick and easy way to turn out a forecast.
 This is a way to pool the experience and judgment of well informed
people.
 This may be the only feasible approach if the company is so young that it
has not yet accumulated the experience to use other forecasting methods.
 This method may be used when adequate sales and market statistics are
missing, or when these figures have not yet been put into the form
required for more sophisticated forecasting methods.

Sales Planning
3.1
The jury of executive opinion method has weakness.
 Its findings are based primarily on opinion, and factual evidence to support
the forecast is often sketchy.
 This approach adds to the work load of key executives, requiring them to
spend time that they would otherwise devote to their areas of main
responsibility.
 And a forecast made by this method is difficult to break down into estimates
of probable sales by products, by time intervals, by markets, by customers,
and so on.
b) The Delphi Technique:
Several years ago researchers at the he Rand Corporation developed a
technique for predicting the future that is called the Delphi technique. This is a
version of the jury of executive opinion method in which those giving opinions
are selected for their “expertise”.
c) Poll of Sales Force Opinion:
In the poll of sales force opinion method, often tagged “the grass-roots
approach, individual sales personnel forecast sales for their territories; then
individual forecasts are combined and modified, as management thinks
necessary, to form the company sales forecast.

Sales Planning
3.1
d) Survey of Customers’ Buying Plans:
What more sensible way to forecast than to ask customers about their future
buying plans? Industrial marketers use this approach more than consumer-
goods marketers, because it is easiest to use where the potential market
consists of small numbers of customers and prospects, substantial sales are
made to individual accounts, the manufacturer sells direct to users, and
customers are concentrated in a few geographical areas (all more typical of
industrial than consumer marketing).
2) Quantitative Forecasting Methods:
a) Projection of Past Sales:
The projection of past sales method of sales forecasting takes a variety to
forms. The simplest is to set the sales forecast for the coming year at the
same figure as the current year’s actual sales, or the forecast may be made
by adding a set percentage to last year’s sales, or to a moving average of
the sales figure for several past years.
b) Time-Series Analysis:
Not greatly different in principle from the simple projection of past sales in
time-series analysis, a statistical procedure for studying historical sales
data. This procedure involves isolating and measuring four chief types of
sales variations.

Sales Planning
3.1
c) Moving Average Method:
Are used to allow for market place factor changing at different rates and at
different times. With this method both distant past and distant future have
little value in forecasting. The moving average is a technique that attempts
to “smooth out “The different rates of change for the immediate past ,
usually past three to five years.
d) Exponential Smoothing:
One statistical technique for short-range sales forecasting, exponential
smoothing, is a type of moving average that represents a weighted sum of
all past numbers in a time series, with the heaviest weight placed on the
most recent data
e) Regression Analysis:
Regression analysis is a statistical process and, as used in sales
forecasting, determines and measures the association between company
sales and other variables. . It involves fitting an equation to explain sales
fluctuations in terms of related and presumably causal variables,
substituting for these variables values considered likely during the period to

Sales Planning
3.1
F) Econometric Model Building and Simulation:
Econometric model building and simulation is attractive as a sales
forecasting method for companies marketing durable goods. This approach
uses an equation or system of equations to represent a set of relationships
among sales and different demand-determining independent variables.
B) Sales Budgeting:
Just how does budgeting fit into strategic and operational planning? The
answer is that the budget reflects the dollar manifestation of the plan. It is
quite difficult to put dollar costs to those plans and make them all result in a
profit. The budget is the planner’s governor. It forces a reality on the planner
that is mandatory for profitable operation. Ultimately all plans must be
quantified into dollars and checked against realty.

Sales Planning
3.1
Purposes of Budgeting:
a) Planning:
Companies formulate marketing and sales objectives. The budget determines
how these objectives will be met. The budget is both a plan of action and a
standard of performance for the various departments
b) Coordination:
Maintaining the desired relationship between expenditures and revenues is
important in operating a business.
c) Evaluation:
Any goal, once established, becomes a tool for evaluation of performance. If
the organization meets its goals, management can consider the performance
successful.
Determining the Sales Budget:
a) Budgeting by Percentage of Sales Method:
Many business people plan and control their enterprises by percentages.
Using this method, the manager multiplies the sales, forecast by various
percentages for each category of expense.

Sales Planning
3.1
Determining the Sales Budget:
b) Budgeting by the Objective and Task Method:
In the objective and task method, the manager starts with the sales
objectives, which are specified in the sales forecast. Then the manager
determines the task that must be accomplished in order to achieve the
objectives and estimates the costs of performing those tasks.
Budgeting by the Objective and Task Method:
a) The Sales Budget:
The sales budget is the revenue or unit volume anticipated from sales of the
firm’s products. This is the key budget. It is the basis of all operating
activities in the sales department and in the production and finance areas.
b) The Selling-Expense Budget:
The selling-expense budget anticipates the various expenditures for
personal-selling activities. These are the salaries, commissions, and
expenses for the sales force.

Sales Planning
3.1
Budgeting by the Objective and Task Method:
c) The Administrative Budget:
In addition to having direct control over management of the sales force, the
typical sales executive is also an office manager. Ordinarily the staff includes
sales department secretaries and office workers; the total staff can be large.
C) Sales Quotas:
Meaning:
Quotas are quantitative objectives assigned to sales organizational units
individual sales personnel, for instance. As standards for appraising selling
effectiveness, quotas specify desired performance levels for sales volume;
such budgeted items as expenses, gross margin, net profit, and return on
investment; selling- and non selling-related activities; or some combination of
these items.

Sales Planning
3.1
C) Sales Quotas:
Definition:
Quota can be defined as:
“Sales quota represents a specific sales goal that an individual is responsible
for satisfying over a period of time, usually a year. Specifically, quotas
measure and define the appropriate accomplishment level desired from an
individual by management.”
Purposes of Sales Quotas:
 To indicate stronger weak spots in the selling structure
 To furnish goals and incentives for the sales force
 To control salespeople’s activities
 To evaluate productivity of salespeople
 To improve effectiveness of compensation plans
 To control selling expense
 To evaluate sales contest results

Sales Planning
3.1
D) Quotas, the Sales Forecast, and the Sales Budget:
Relationships among quotas, the sales forecast, and the sales budget vary
from company to company. Relationships depend not only upon the
procedures used in forecasting, budgeting, and quota setting but upon how
the planners integrate these three procedures.
E) Sales Target:
Sales person manage the territory, so he got to have a time-bound sales
target. Sales person can approach the target in two ways. One, he try to meet
the target by working so hard that forget everything else working through days
and nights and continuously traveling across your territory. This approach can
indeed get you close to the target but the approach is unplanned.

Sales Control
3.2
Sales Control:
One of the most important responsibilities of a sales manager is to exercise
control over sales and the performance of selling! sales activities. Sales need to
be controlled both on an ongoing (continuous) basis as well as overall,
periodically.
A) Purpose of Sales Control:
1) Initiating remedial steps
2) Revising the sales policy and strategies followed
3) Implementing steps for improving the productivity of sales force
4) Improving the quality of target-setting sales plans and budget functions
5) Increasing sales profitability
B) Nature of Sales Control:
The key role played by evaluation and control in the management process is
depicted in the feedback-control system shown in Figure. Company goals
initiate the process by serving as the targets that guide the formulation of
plans. Once designed, the plans need to be implemented to become part of
the daily operations. The firm then needs to collect and organize information
about its operations so that it can compare this data with its goals to
determine how well it is doing. Such evaluation and comparison provide the
control for the enterprise.

Sales Control
3.2
B) Nature of Sales Control:
Fig: Control of the Sales operation

Sales Control
3.2
C) Methods of Sales Control:
a) Sales volume analysis:
This is a detailed examination of sales volume by territory salesperson,
customer, product line, etc., which is recommended in order to know the
real situation and gain meaningful insight.
Table: Sales analysis by Product Line

Sales Control
3.2
b) Cost analysis technique:
A cost analysis attempts to isolate the costs incurred in producing various
levels of sales in order to determine the segment-wise profitability of sales
of the business.
c) Performance analysis:
This analysis is used to judge the performance of the sales representative
based on five factors: role perception, aptitude, skill level, motivation level,
personal and organizational variables that affect performance.
Fig: Performance Analysis Model

Sales Control
3.2
D) Primary and Secondary Sales Report:
a)Primary Sales Report:
Fig: System Generated Standard Excel Template, which has the Following
details:
The above template has the following details:
 Invoice date
 Distributor code
 SKU#
 Quantity
 Invoice#

Sales Control
3.2
D) Primary and Secondary Sales Report:
a)Secondary Sales Report:
Fig: : Secondary Sales Report
Distributor opens the interface and enters his secondary sales to his distributor.
Or, distributor uploads the secondary sales, with following details
 Data of sale
 Retailer code
 Distributor salesman code
 SKU#
 Quantity etc.

Sales Control
3.2
F) Monthly Sales Plan:
Formats of Monthly sales plan Report:
Format 1:
sales for month actual plan variance % actual plan variance %
volumes/quantity/numb
er
values/revenues
margin/contribution
% margin/contribution
number of orders
average order value
next month forecast f'cast plan variance % f'cast plan variance %
volumes/quantity/numb
er
values/revenues
margin
quarter forecast f'cast plan variance % f'cast plan variance %
values/revenues
margin
year forecast f'cast plan variance %
values/revenues
margin
businessballs.com
market comments (trends, developments, SWOT factors of note, i.e., strengths, weaknesses, opportunities,
threats)
sales dept/team …………. month …………
monthly sales report/forecast (template)
This basic sales report/forecast tool is for a small or new businesses which does not yet have a computerised
full management information system, which would normally integrate sales reporting with other business
processes.
see note (in msexcel version only,
available from businessballs.com)
© alan chapman 2006, from www.businessballs.com, not to be sold or published. Alan Chapman accepts no liability.
month cumulative (year to date)
Report compiled by ……………...………..….. Date ………………..
summary/forecast of sales performance and activities
comments on internal services affecting sales and customers (e.g., order processing, customer
services, stock, distribution and deliveries/installations, service support, invoicing, major/national contracts,
new product development, recruitment and training, etc)
competitor activity

Sales Control
3.2
Format 2:

Sales Control
3.2
Format 3:

Sales Control
3.2
G) Territory Sales and Coverage Plan:
Territory management is a tool by which you can assist your company in the
achievement of its broad objectives. Territory means the land area in which you
operate and which a sales executive/rep is responsible for.
a) Territory Management & Planning:
Planning is the process of determining what you want to accomplish (the end
result or outcome) and how you wish to achieve it, using the most effective
and efficient ways. Planning involves the following steps:
 setting objectives
 identifying resources and
 devising strategies
b) Nature of Territory Management:
 Salespeople are not only responsible for individual customers (account
management) but also responsible for a group of accounts (territory
management).

Sales Control
3.2
b) Nature of Territory Management:
 It is defined as planning, implementation, and control, of sales person’s
activities with the goal of realizing the sales and profits potentials of their
assigned territories.
 Although geographic considerations play a role in setting boundaries, sales
territories are primarily based on customer grouping.
 Should the sales executive assigned a territory on the basis of the
geographically area or customer base?
c) Reasons for Establishing Sales Territories:
 Ensure better coverage:
 Reduced selling costs:
 Improved customer service:
 More accurate evaluation of performance:

Sales Control
3.2
d) Elements of Territory Action Plans:
 Analyze your customers
 Define your objectives by customer
 Allocate territory time
 Plan your calls
 Schedule your calls
 Plan your route
 Evaluate your plan
e) Sales Coverage Plan:
The right sales coverage plan takes into account the target customer and
segment, the size and structure of the sales force deployed against them, and
the sales channels used to reach them. One should take a deep dive into all of
these elements to develop a specific set of sales processes and roles that
clearly answers the questions of how, where and when to deploy sales
resources.

Sales Control
3.2
Factors of Sales Coverage Plan:
 Customer Segmentation and Targeting
 Channel Selection and Sales Coverage Plan Format
 Sales Process and Role Design
 Sizing and Deployment
H) Daily sales Call Report:
The daily call report tells you how and how often your sales representatives
are calling on the accounts in their assigned territory. The specific data asked
for in this report varies by company and industry but most commonly includes
what companies the salespeople called on, who they spoke with, whether the
calls were in person or by phone, what they talked about, what the next
action steps will be and when the next scheduled calls

Sales Control
3.2
Format 1:

Sales Control
3.2
Format 2:
Decision Maker Designation Contact No Decision Influencer Contact No Product

Sales Control
3.2
I) Expired goods and Breakage Return Report:
Expired goods and breakage return reports are generated for count the actual
number of dead items and actual number of items returned to customer so
that reproduction of such items if necessary should be considered.
a) Expired Goods Report:
Broad Level
Report
Options available
for report
execution
Remarks Used By Report Area
Expiration date list By material
By Plant
By batch
This report
provides an
overview of the
remaining shelf life
of batches. This
report is generally
useful in Pharma.
Stores / Planning Inventory
Dead Stock items By material
By commodity
type
By buyer
By material
planner
This report will
help you to identify
dead inventory
Executive Inventory
Breakdown
analysis
By machine
By machine group
This report can be
used to extract the
information on
breakdown such
as number of
break down,
MTTR, MTBF
Shop floor Maintenance

Sales Control
3.2
b) Breakage return Report:
1) A distributor should receive breakage product returns or exchanges
pursuant to the terms and conditions of the agreement between the
distributor and the recipient. Both distributors and recipients should be
accountable for administering their returns process and ensuring that the
aspects of this operation are secure and do not permit the entry of
counterfeit products.
2) The necessary assessment and decision regarding the disposition of such
products must be made by a suitably authorized person. The nature of the
product returned to the distributor, any special storage conditions required,
its condition and history and the time elapsed since it was issued, should
all be taken into account in this assessment. Where any doubt arises over
the quality of a product, it should not be considered suitable for reissue or
reuse.
3) Provision should be made for the appropriate and safe transport of
returned products in accordance with the relevant storage and other
requirements. Breakaged products and those returned to a distributor
should be appropriately identified and handled in accordance with a

Sales Control
3.2
b) Breakage return Report:
a) The physical segregation of such products in quarantine in a dedicated
area; or
b) other equivalent (e.g. electronic) segregation.
4) This is to avoid confusion and prevent distribution until a decision has been
taken with regard to their disposition. The particular storage conditions
applicable to a product which is breakage or returned should be maintained
during storage and transit until such time as a decision has been made
regarding the product in question.
5) Destruction of products should be done in accordance with international,
national and local requirements regarding disposal of such products, and with
due consideration to protection of the environment.
6) Records of all returned, rejected and/or pharmaceutical products should be
kept for a predetermined period.

Sales Control
3.2
J) Order Booking Report
Sales Order is an order placed by a buyer for the purchase of goods. It consists of
details such as date of sales order, party name, Vch Type, Vch No, Order Ref No,
Order and Amount. Sales Order Book displays a list of all Sales Orders. Following
is the Sample report for order booking:
Format 1: Booking Order No.
Date
Name of Company / Client
Address
Phone No.
Email
Description of Order
Date and Venue
Name of Key Person
Estimated cost of Order
Booking Advance
Delivery Date
Customer’s Signature

Sales Control
3.2
K) Monthly and Quarterly Sales Report:
This report provides a complete summary of all sales activity for a selected
material. Product manager’s can use this report to measure material activity and
its quarterly trends using a complete set of metrics.
Format 1:

Sales Control
3.2
L) Monthly and Quarterly Sales Report:
Format 2:

Sales Audit
3.3
Sales Audit:
The sales executives/sales people play a crucial role in the sales organizations.
They are responsible for many activities: they participate in setting selling and profit
objectives; formulating sales-related marketing policies; and designing personal-
selling strategies. Further, they build and develop a sales organization to carry the
sales program into effect. They integrate the sales organization with the distributive
network and other company marketing units.
Meaning:
In sale organisations; the sales audit is a systematic and comprehensive
appraisal of the total selling operations. It appraises integration of the individual
inputs to the personal selling effort and identifies and evaluates assumptions
underlying the sales operation. Specifically, a sales audit is a systematic, critical,
and unbiased review field appraisal of the basic objectives and policies of the
selling function ad of the organization, methods, procedures, and personnel
employed to implement those policies and achieve those objectives; which are
predetermined by the sales organisation.

Sales Audit
3.3
A) Aspects of Sales Management Audit:
1) Objectives:
Each selling input should have clearly defined objectives, related to desired
outputs.
2) Policies:
In case of policies; both explicit and implicit are appraised for their
consistency in achieving the selling objectives
3) Methods:
In this step; it is felt that the individual strategies for carrying out policies are
appropriate or not.
4) Procedures:
The steps in implementing individual strategies should be logical, well
designed, and chosen to fit the situation.
5) Personnel:
All executives playing key roles in planning sales operations and strategy, as
well as those responsible for implementation of sales programmes are
evaluated as to their effectiveness relative to stated objectives, policies, and
other aspects of sales operations.

Sales Audit
3.3
B) Sales Force Productivity Indicators (Value and Volume):
The efficient operation of a salesforce is a critical element in the profitability of
many firms.
a) Measuring Productivity of Salesforce:
Within an organization, technical sales forces are usually broken down into
regions and then further into districts, Several salespeople operate within each
district and often each salesperson has an exclusive territory in which to sell
the product line of the firm through periodic calls on current and potential
clients.
1) Territory Productivit
A sales territory consiy:sts of existing and potential customers assigned to
a salesperson. The territory may or may not have geographic boundaries
Reasons for Measuring Productivity of Sales Territories:
a) Increase Market or Customer Coverage:
A well-designed sales territory allows salespeople to spend sufficient time
with present and potential customers, which improves the market coverage.
b) Increase Market or Customer Coverage:
A well-designed sales territory allows salespeople to spend sufficient time
with present and potential customers, which improves the market coverage.

Sales Audit
3.3
Reasons for Measuring Productivity of Sales Territories:
c) Better Evaluation of Sales Force Performance:
The sales manager can evaluate the performance of each salesperson in a
better way, when the salesperson is assigned to a specific sales territory.
d) Improve Customer Relations:
When the sales person spends adequate time with present and potential
customer’s, to understand their problems (or needs) and to find solutions (or
satisfy the needs), their relationship improve.
2) Per Person per Month Productivity:
Productivity is an average measure of the efficiency of production. It can be
expressed as the ratio of output to inputs used in the production process, i.e.
output per unit of input. When all outputs and inputs used for a month are
included in the productivity measure it is called total productivity of a month.
3) Sales to Marketing Expenses Ratio:
Some marketers believe the purpose of marketing expense-to-sales ratios is
to align marketing spend with industry norms. The belief may stem from the
fact that marketing spend as a percentage of sales tends to fluctuate by
industry within defined ranges.

Sales Audit
3.3
4) Drive Productivity:
One can divide the marketing process into three phases: develop the
marketing plan, execute the plan, and monitor and control the plan
execution. It's necessary to monitor and control the execution to identify and
contain risks from unwanted surprises that pop up during the execution
phase. Marketing expense-to-sales ratio is included with sales analysis,
market share analysis, financial analysis and market-based scorecard
analysis as one of the five analysis tools marketers used to control and drive
spending productivity.
5) Benchmark Marketing:
Benchmark marketing tying marketing spending to industry or other
benchmarks is commonly endorsed in marketing literature, and many
marketing advisers recommend it to small-business operators by many
marketing advisers.
6) Benchmark Marketing Productivity:
This requires a task-oriented approach to marketing spending that funds
enumerated tasks to achieve explicit objectives.
7) Spend According to Means:
Benchmarking against industry or other norms does not require a marketing
plan. Just find out what industry normally spends and spend accordingly.

Sales Audit
3.3
Steps to Measure Sales Force Productivity:
1) Calculate the Cost:
Cost of Sales is an important measure of productivity. To calculate this, consider all
of the expenses relevant to your sales force, including not only salaries and
commissions but also related benefits and incentives.
2) Set S.M.A.R.T. Sales Quotas:
sales quotas that are metrics that are specific, measurable, attainable, relevant
and time-bound. The last thing you want is to set vague, unattainable revenue
thresholds for your sales staff.
3) Track Performance:
Tracking performance helps you predict the future and determine where change is
critical. If your salespeople have generated $10 million on average over the last
seven years, it's reasonable to expect similar sales in the current year.
4) Monitor Industry Trends:
This can include not only monitoring competitor revenue numbers, but also
tracking new competitors, competitors that exit the industry, and new offerings and
solutions that can affect future sales.
5) Use CRM Software:
Add customer relationship management software to the operational arsenal you
use to measure and project sales force productivity.

Specialised Techniques in Selling
3.4
Specialised Techniques in Selling:
All over the world people are buying and selling products at all hours of the day. Sales
professionals use various techniques to introduce products to customers and
encourage them to purchase their products. Some of the techniques engage potential
or repeat customers directly with a salesperson, while other techniques involve a
more hands-off approach.
1) Tele/Mobile Marketing:
Telemarketing is a method of direct marketing in which a salesperson solicits to
prospective customers to buy products or services over the phone.
Categories of Tele Marketing:
1) Business-to-business2) Business-to-customer
There are four sub categories of telemarketing as follows :
a) Lead Generation : It means the gathering of information.
b) Sales : It means using persuasion to sell a product or service.
c) Out bound : It means productive marketing in which prospective and
preexisting customers are contacted directly.
d) In bound : It means productive marketing in which prospective and preexisting
customers are contacted directly.

3.4
Specialised Techniques in Selling:
All over the world people are buying and selling products at all hours of the day. Sales
professionals use various techniques to introduce products to customers and
encourage them to purchase their products. Some of the techniques engage potential
or repeat customers directly with a salesperson, while other techniques involve a more
hands-off approach.
Telemarketing is a method of direct marketing in which a salesperson solicits to
prospective customers to buy products or services over the phone.
A) Categories of Tele Marketing:
1) Business-to-business 2) Business-to-customer
There are four sub categories of telemarketing as follows :
a)Lead Generation
b) Sales
c) Out bound
d) In bound

3.4
B) Procedure off tele Marketing:
An effective telemarketing process often involves two or more calls.
a) The first call or series of call : It determines the customer’s need.
b) The final call or series of calls : It motivates the customer to make a purchase.
2) Online Marketing:
 This is one of the direct marketing tools. It describes a wide variety of electronic
platforms.
 Online marketing functions as an information source, a communication channel, an
entertainment source.
 The internet is used for this purpose. If a company does an e-mail campaign right,
it cannot only build customer relationships but also reap additional profit.
 Attractive incentives are offered by the companies to surfers for reading e-mail
pitches and online add because e-mail campaigns can be carried out quickly. Such
campaigns can offer time sensitive information.

3.4
Online marketing methods and strategies encompass a wide range of services. They
are as follows :
 Affiliate marketing
 Behavioural marketing
 Cause marketing
 Contextual advertising
 Software based marketing
 Digital marketing
 Display marketing
 E - mail marketing
 In - text advertising
 Interactive advertising
 Internet news releases
 Newsletter marketing
 On line market research
 On line Reputation management (ORM)
 Search Engine marketing
 Social Media marketing
 Customer relationship marketing (CRM) marketing.

3.4
A) Advantages of Online Marketing :
a) Inexpensive Way of Marketing :
E-marketing is relatively inexpensive when compared to the ratio of cost against
the reach of the target audience.
b) One-to-One Approach :
The target user is typically browsing the Internet alone, so the marketing
messages can reach him personally.
c) Appeal to Specific Interest :
E-marketing places an emphasis on marketing those appeals to a specific
behaviour or interest rather than reaching out to a broadly defined demographic.
d) Convenient for Customers :
The nature of medium allows consumers to research and purchase products and
services at their own convenience.
e) Easy and Inexpensive Statistics Measurements :
E-marketers have the advantage of measuring statistics easily and inexpensively.
Nearly all aspects of an e-marketing campaign can be traced, measured and
tested

3.4
B) Limitations of Online Marketing:
a) Technologies :
E-marketing requires customers to use newer technologies rather than traditional
media. It is not possible for every customer in India to use this device for
purchasing.
b) Low Speed :
Low speed Internet connections are another barrier.
c) Buyer’s Perspective
From the buyer’s perspective, the inability of shoppers to touch, smell, taste or try
on tangible goods before making an on line purchase can be limiting.
d) Other Limitations :
 Insufficient ability to measure impact
 Lack of internal capacity, and
 Difficulty in convincing senior management.

3.4
3) E-Commerce:
Since last few years, the new concept is introduced in the field of marketing. It is E-
marketing [Electronic] concept.
Meaning;
On business front, internet is changing relationship between buyer and the seller. E-
commerce is capability of exchanging value electronically. Advantages that E-
commerce offers to manufacturing organisations are :
 Marketing and distribution overheads are reduced.
 Larger catalogue and product literature visibility at lower cost.
 Improved cash-to-cash cycle.
 Improved customer service level.
 Better information about customers and their requirements.

3.4
3) E-Commerce:
Benefits of E-commerce :
a) Lower Transaction Costs :
If an e-commerce site is implemented well, the web can significantly lower both
order-taking costs up front and customer service costs after the sale by
automating processes.
b) Larger Purchases per Transaction :
Amazon offers a feature that no normal store offers
c) Integration into the Business Cycle :
A website that is well integrated into the business cycle can offer customers more
information than previously available
d) Larger Catalogues :
A company can build a catalogue on the web that would never fit in an ordinary
mailbox.
e) New Business Models :
There is one final point for e-commerce that needs to be made. E-commerce

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