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Marketing Case Study

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Natasha Overbeek            



Case Study Analysis

Questions for Discussion

  1. Direct selling personal sales representatives are legitimate and authentic salespeople because just like all other salespeople, they have to be involved in the personnel selling process of prospecting, pre-approach, approach, making the presentation, overcoming objections, and closing the sale.
  2. Direct selling is even more successful in China than in the Unites States because it offers women, (who are usually not able to start their own business) a way to earn an income and maintain enough responsibility to perform domestic responsibilities. Direct selling allows women to help their families earn income in uncertain financial times when family members are out of work . In the United States, direct selling is still taken for granted, but in China, sales are predicted be increased by 30%
  3. Direct selling offers women a way to start their own sales business, as well as offers advancement opportunities and training. Direct selling helps women to earn an income in uncertain financial times when other family members are out of work. Even women who do not earn much money in sales appreciate the flexibility and corporate culture.

1. Problem Identification

Direct selling has become more popular within this century. In many places, including China and the US, it is still frowned upon by the government, despite the fact that it has quickly grown to become a multi-billion dollar industry.

1.1 Minor Problems

        Chinese officials still regard direct selling with suspicion since a common tactic of con artists is to pose as direct sellers. Therefore, China has implemented laws limiting the ways direct selling companies could compensate their sales force and banned teachers, doctors, and civil servants from becoming direct sellers.

1.2 Major Problems

        Many people still do not view directs sales personnel and authentic sales people. This view can affect the sales and growth of a direct sales industry.

1.3 Possible Future Problems

        Because direct selling has such strong potential for growth, other business selling similar or the same products may suffer losses because of it.

2. Problem analysis

        The Chinese government is hesitant to support the direct sales, because con artists pose as direct sales associates and scam many people. If the government was to fully support this, more people may find it easier to scam potential customers, which would also turn those victims away from direct sales.

2.1 Apparent Causes and Justification

        People have taken advantage of direct sales, creating pyramid schemes and multi-level selling. Pyramid schemes occur when money is exchanged for recruiting other people into the scheme. Leaders of successful schemes make the most money, while those who fail to recruit others lose out.  Con artists also use direct sales to scam people. Because of this, Chinese officials are hesitant to support direct sales.

2.2 Underlying Issues

        Direct sales may affect small, local businesses negatively, by taking away from their sales.

2.3 Assumptions Made

        Direct sales may take away business from local businesses. This may occur because direct sales offer a more personal and intimate approach to making sales.

3. Alternative Solutions

Direct selling can be allowed and accepted everywhere, only if restrictions are made. All direct sales personnel should be able to provide proof of legitimacy to all customers, so that customers know that they are not being scammed. Also direct sales should not be allowed in legitimate shopping areas.



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