The proper relationship between selling and marketing has always been a problem both for companies and for the marketing discipline. Are they distinct functions, or is selling part of marketing? We know that marketing originated as a form of support for sales force management, including the development of promotional materials and sales tools, the use of market research to plan and control field sales activity, and the development of strong brands to support the trade channels and related selling effort. However, it was a central part of Ducker’s (1954) thesis that marketing is more than selling and is distinct from it. Over time, sales management emerged as a separate field of study within the marketing discipline and was a major focus of academic research from the 1950s to the 1980s. A significant amount of the mathematical modelling of marketing activities that was published in the 1960s and 1970s addressed field sales management issues, such as call frequency, the design of sales territories, sales force size, sales compensation plans, and assignment of individual sales representatives to specific territories. Some observers estimate that as much as 80% of the total marketing communications budget is now spent on selling (including trade discounts in some cases), leaving only 20% for advertising and other communication and consumer sales promotion activities. Surprisingly, even as marketing dollars have shifted from other activities to the field sales force operation, academic interest in sales management has all but disappeared. Just as sales and marketing are distinct management activities in many companies, so it appears that many academics do not think of sales management when they think of marketing. Sales promotions, narrowly defined as short-term price reductions and other incentives such as additional merchandise, special packaging, or rewards for frequent patronage, have become a principal marketing tool, often accounting for the lion’s share of the consumer-marketing budget. There is a wide range of practice pertaining to the accounting for sales promotion expenditures: Are expenditures simply reductions in price that should be deducted from top-line sales revenue, or should they be a separate expense item within marketing or sales? There are two major attractions of sales promotions for marketers: First, they can produce more or less immediate results, thus enhancing short-term revenues and related measures of business performance. Second, these results can be tracked and measured relatively easily using point-of-purchase sales tabulations and other databases that are now widely available from retailers and service organizations. Given the academic field’s interest in empirical data, combined with the development of sophisticated statistical methodologies and database owners eager to maximize the value of their investments in these data, it is no surprise that sales promotion has become perhaps the most widely and rigorously studied area of marketing in recent times. There is undoubtedly a reinforcing feedback effect on the widespread use of sales promotion as a marketing tool, as managers under pressure to measure the effectiveness of their expenditures to support their budget requests allocate additional resources to the areas in which they can track and report results with a reasonable degree of validity and reliability. The large, low cost retailers have the ability to control access to the necessary data and thereby gain additional power in their relationships with their suppliers, thus diminishing the relative power of the manufacturer and the manufacturer’s brand while delivering lower prices to the consumer.
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