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Reebok 1 (674.0K)
VIDEO CASE 20–1 Reebok International Ltd.
“I think face-to-face selling is the most important and exciting part of this whole job. It’s not writing the sales reports. It’s not analyzing trends and forecasting. It’s the two hours that you have to try to sell the buyer your products in a way that’s profitable for both you and the retailer,” relates Robert McMahon, key account sales representative. McMahon’s job encompasses myriad activities, from supervising other sales representatives to attending companywide computer training sessions to monitoring competitors’ activities. But it’s the actual selling that is most appealing to McMahon. “That’s the challenging, stimulating part of the job. Selling to the buyer is a different challenge every day. Every sales call, as well as you may have preplanned it, can change based on shifts and trends in the market. So you need to be able to react to those changes and really think on your feet in front of the buyer.”
Reebok—Hot on Nike’s Heels in the athletic shoe and apparel market
Reebok is the second largest athletic shoe manufacturer behind the market leader, Nike. In addition to its athletic shoes, Reebok also sells Rockport, Greg Norman Collection, and Ralph Lauren Footwear shoes. The Reebok sporting goods line remains the flagship brand, though, and distinguishes itself on the market through the DMX cushioning technology in its footwear. Reebok concentrates its resources on getting its footwear and sporting goods gear into a diversified mix of distribution channels such as athletic footwear specialty stores, department stores, and large sporting goods stores.
Reebok is unique in that it emphasizes relationships with the retailers as an integral part of its marketing strategy. As an employee at MVP Sports, one of Reebok’s major retailers, puts it, “Reebok is the only company that comes in on a regular basis and gives us information. Nike comes in once in a great while. New Balance comes in every six months. Saucony has come in twice. That’s been it. Reebok comes in every month to update us on new information and new products. They tell us about the technology so we can tell the customers.” Says Laurie Sipples, “vector” representative for Reebok, “There’s a partnership that exists between Reebok and an account like MVP Sports that sets us apart. That relationship is a great asset that Reebok has because the retailer feels more in touch with us than other brands.”
The selling process at Reebok
Selling at Reebok includes three elements—building trust between the salesperson and the retailer, providing enough information to the retailer for them to be successful selling Reebok products, and, finally, supporting the retailer after the sale. Sean Neville, senior vice president and general manager of Reebok North America, explains, “Our goal is not to sell to the retailer, our goal is ultimately to sell to the consumer, and so we use the retailer as a partner. The salespeople are always keeping their eyes open and thinking like the retailer and selling to the consumer.”
Reebok sells in teams that consist of the account representatives, who do the actual selling to the retailer, and the “vector” representatives, who spend their time in the stores training the store salespeople and reporting trends back to the account manager. The selling teams are organized geographically so that the salespeople live and work in the area they are selling in. This allows the sales team to understand the consumer intuitively. Neville explains, “If you have someone from one city fly to another and try to tell someone on the streets of that city what’s happening from a trends standpoint and what products to purchase, it’s very difficult.”
On average, Reebok salespeople spend 70 percent of their time preparing for a sale and 30 percent of their time actually selling. The sales process at Reebok typically follows the six steps of the personal selling process identified in Figure 20–3: (1) Reebok identifies the outlets it would like to carry its athletic gear; (2) the salesforce prepares for the a presentation by familiarizing themselves with the store and its customers; (3) a Reebok representative approaches the prospect and suggests a meeting and presentation; (4) as the presentation begins, the salesperson summarizes relevant market conditions and consumer trends to demonstrate Reebok’s commitment to a partnership with the retailer, states what s/he hopes to get out of the sales meeting, explains how the products work, and reinforces the benefits of Reebok products; (5) the salesperson engages in an action close (gets a signed document or a firm confirmation of the sale); and (6) later, various members of the salesforce frequently visit the retailer to provide assistance and monitor consumer preferences.
The sales management process at Reebok
The sales teams at Reebok are organized based on Reebok’s three major distribution channels: athletic specialty stores, sporting goods stores, and department stores. The smaller stores have sales teams assigned to them based on geographical location. The salesforce is then further broken down into footwear and apparel teams. The salesforce is primarily organized by distribution channel because this is most responsive to customer needs and wants. The salesforce is compensated on both a short-term and a long-term basis. In the short term, salespeople are paid based on sales results and profits for the current quarter as well as forecasting. In the long term, salespeople are compensated based on their teamwork and teambuilding efforts. As Neville explains, “Money is typically fourth or fifth on the list of pure motivation. Number one is recognition for a job well done. And that drives people to succeed.” Management at Reebok is constantly providing feedback to the salesforce acknowledging their success, not just during annual reviews, and Neville feels this is the key to the high level of motivation, energy, and excitement that exists in the salesforce at Reebok.
What’s new on the horizon for the salesforce at Reebok?
Reebok has recently issued laptop computers to its entire salesforce, which enable the salespeople to check inventories in the warehouses, make sure orders are being shipped on time, and even enter orders while they’re out in the field. Reebok is also focusing more on relationship selling. McMahon describes his relationship with a major buyer as, “one of trust and respect. It’s gotten to the point now where we’re good friends. We go to a lot of sporting events together, which I think really helps.”
Another recent innovation is for the salesforce to incentivize the store’s sales clerks. For instance, whoever sells the most pairs of Reebok shoes in a month will get tickets to a concert or a football game.
