Salesman vs Sales Letter

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• This presentation brings out the qualities,
  types, drawbacks and most importantly
  differences between salesman and sales letter.
• We have discussed on two US Insurance
  company. One working on the concept of
  marketing by strengthening salesperson while
  the other on direct marketing which uses sales
  letter as its major form of marketing, they are
  State Farm and GEICO respectively.
                     Major steps in effective selling

                Pre                                Handling
Prospecting              Approach   Presentation                Closing   Follow up
              approach                             Objectives
Who is a salesperson?
•The term salesperson covers a wide range of
•At one extreme, a salesperson might be largely an
 order taker, such as the department store
 salesperson standing behind the counter.
• At the other extreme are order getters, whose
 positions demand creative selling and relationship
 building for products and services ranging from
 appliances, industrial equipment, and airplanes to
 insurance and information technology services.
Qualities that define an effective sales person

     Pleasing                   Confident

                                Patient &
                  Team Player
What is a Sales letter?

• The sales letter is the most important element of
  the standard direct mail package.
• It takes the place of a salesperson and provides
  sellers with the opportunity for personal, one-on-
  one communication with their prospects.
• In addition to their use in direct mail, sales
  letters are also used by salespeople in a variety of
  situations—from customer communications to
  internal letters written for others on the sales
The sales letter is basically sent in the following forms:

• Direct Mail

• E-mail

• Leaflet and Pamphlet Distribution
•In many developing countries, especially India, major
portion of the population does not have access to
internet. Neither does the company have the mailing
address to send personalised mails.

•If a salesperson gets a “NO”, he can still explore the root
reason and can continue on.

•Software have come up to write fast, effective and
personalised sales letter, whereas for a salesperson
everyday has to be planned differently for maximum
productivity and success.
•Money and time : key feature gearing up sales letter.

• Easy and clear feedback.

•Sales letter shares no irrelevant information. Salesman
may share meaningless irrelevant information for sales.

•For expensive products company prefers salesman to
sales letter.

•Little disruption in time management could result in
losing a prospect

•Emotions and feelings: extra tools for sales for a
•Personal attention leading to better customer

•A sales letter can be reviewed before dispatching.

•Low reliance on sales letter via email.
   •May contain virus and malicious software.
   • They are termed as SPAM.
   •80-85% of all the emails in the world are spam.
•Huge impact on environment due to sales letter.
   •According to EPA 44% of junk mail is discarded
   without being opened or read.
   •This equals 4 tons of waste paper every year.
   •OCAPP estimated that 250,000 homes could be
   heated for a single day’s junk mail.

•Some resent sales letter as being ‘forced’ upon them
and boycott companies that do so.
   •People can obtain Prohibitory Orders against
   company’s mail they find offensive.
•The Green River Ordinance: Prohibition of door to door

   •Named after the city of Green River, Wyoming, the
   first city to enact it.

   •Some versions prohibit all organisation including
   non-profit, charitable, political and religious groups.
• Founded in 1936, initially targeted a select
  customer group of government employees and
  non commissioned military officers with
  exceptional driving records.
• Unlike its much larger competitors, GEICO has no
  agents. Instead the auto insurer markets directly
  to customers.
• In 1995, the company spent $10 million to
  launch its first TV, radio and print ads (majorly
  consisting of sales letter) to support its direct
  mail marketing.
• In 1996, billionaire investor Warren Buffet bought
  the company bought the company and told the
  marketing group to “speed things up”.
• Over the next 10 years, GEICO’s ad spending
  jumped 30 folds to more than $300 million.
• At the time competitors were using serious and
  sentimental pitches – “You are in good hands
  with Allstate” or “Like a good neighbour, State
  Farm is there.” To help make its advertising stand
  out, GEICO decided to deliver its punch line with
  humour. The creative approach worked and sales
  began to climb.
• As the brand grew, customers had difficulty
  pronouncing the GEICO name. Too often , GEICO
  became “gecko”.
• Enter the charismatic green lizard. This was again
  made possible by distributing and sending sales
  letter and advertisement.
• In 1999, GEICO ran a 15 sec spot in which the
  now famous British accented gecko calls a press
  conference and pleads “I am a gecko, not to be
  confused with a GEICO, which could save you
  hundreds on car insurance. So stop calling me.”
• Consumers quickly flooded the company with
  calls and letters begging to see more of the
• To keep its advertising fresh and entertaining
  GEICO organises several new mini campaigns
  where it distributes its leaflets and sales letter.
• In each of the past 5 years, GEICO has
  experienced double digit market share gains.
• Rising from relative obscurity only a dozen
  years ago, the upstart direct marketer now
  serves more than 7 million customers, making
  it 4th largest insurance company , behind State
  Farm, Allstate, and Progressive, all of which do
  most of their business through agents.
First Gecko commercial - 1999
State Farm Insurance
• State Farm Insurance is a group of insurance and financial services
  companies. It is the largest automobile insurer in the United States
  continuously since 1942 and insures more cars and homes in the
  United States than any other insurer. The company also has
  operations in Canada.
• The group's main business is State Farm Mutual Automobile
  Insurance Company, a mutual insurance firm that also owns the
  other State Farm companies. The corporate headquarters are in
  Bloomington, Illinois.
• State Farm is ranked 31st in the 2009 Fortune 500, which lists
  American companies by revenue.
• Founder George J. Mecherle believed that since farmers drove less
  and had fewer losses than city drivers, they should pay less for
  insurance. His idea was popular with farmers and made his new
  company successful
• What actually kept this company going and become
  the largest automobile insurer in US?
  The answer lies in its huge workforce of 68,000 and
  most importantly 17,000 efficient agents.
• State Farm has more store fronts than McDonalds.
• State Farm serves 77million policies in US and Canada
  and serving more than 1.9 million bank accounts.
• As of 2005, it is insuring about 40 million vehicles.
• Six major qualities in the salesperson of State Farm are:
   –   Goal oriented
   –   Confident
   –   Patient and courteous
   –   Team Player
   –   Complete Product Knowledge
   –   Pleasing Personality