Sunday, November 1, 2009

The Ingenious Case of Salesman Shrimaan

Having gone through the perfect example of Apple iPod, as how can proper marketing help a product sell itself? Now coming to the basic concepts of marketing (as given by marketing guru Kotler), viz. STP (Segmentation, Targeting and Positioning) and 4 P’s (Product, Price, Place and Promotion); let us see how these concepts hold true in case of a small scale retailer.

It was a rainy day and I was standing at a shop waiting for rain to stop. I got to see several customers of all sort come and go. Doing nothing, I observed them (thanks to the beautiful girl who shifted my attention from rain outside to inside the shop).

"One young guy (college student) came and what I could make out from their friendly conversation was that he was someone close to the salesmen. He asked for certain products including a deodorant, face wash and few more things. As everyone else does, the boy asked for the price of different brands of deodorants.

Salesmen asked him not to worry about the price, and on being asked he pushed forward a new brand of deodorant that had just arrived in the market. The boy looked a bit conf
used but agreed to buy that deodorant on being insisted by the retailer. When it came to pay money, he found the product cost to be around 10% higher than the normal deodorant cost. The boy took the product and went but felt cheated. This happens with many people, not only youth but also the mature men and women."

Above example brings into light the common Indian culture of socializing and befriending all. Retailers exploit it by getting customers into confidence, and selling them product of their own choice. Sometimes, retailers would push the product which otherwise does not sell and at other times the product which gives them maximum return. This reduces the impact of targeting and positioning being done by the company.

Company may segment and target different segments, but a common retailer like our salesmen shrimaan serves all sorts of customers. He also stocks goods of different brands. So does not this lessen the effect of segmenting and targeting?

The answer to this question is positioning. Positioning is done along the guidelines of Marketing Mix of 4 P’s. It helps your product differentiate itself from the rest of the products. 4P’s: Product, Price, Place, Promotion specifies the various aspects of the value proposition being provided by the manufacturer to consumers. i) It signifies the characteristics of the product, ii) it decides upon the pricing of the product/service, iii) it specifies the distribution mode and channel and places where the product has to be made available, iv) By Promotion, it means spreading awareness and attracting customers by advertising, public relations, contests, discounts etc.

Thus a company tries its best to reach people and position themselves well against their competitors, but the way retailer/salesmen interacts with the customers has major influence on customer’s behavior that can even nullify marketing efforts of product manufacturer.

Another instance, once I found a retailer promoting a brand more strongly than others. That brand did not give him more margins but he was pushing it more just because it was a product manufactured by his close friend.

Does this mean, salesmen have more importance than the marketing basics of STP and 4P’s? What do you think?

The solution to above problem would be to keep retailers in confidence, associate with them and motivate them with rewards. Even mystery shopping can help determine retailers view about your products and keep a check on the selling behavior.

1 comment:

  1. Sales people and retailers have marketing philosophies of their own ..... The real marketing challenge is to sell a comb to a bald man ...... How will Mr.Kotler do that?
    However you can find the answer from a salesman of combs selling it in a mumbai local train !! Appears they need to learn Kotler or does Kotler need to learn them ?