Chapter 3 The Personal Selling Process The sales

Chapter 3 The Personal Selling Process The sales process itself plays an increasing role in creating customer value. Neil Rackham Copyright © 2003 by The Mc. Graw-Hill Companies, Inc. All rights reserved.

TM 3 -2 THE EIGHT STEPS OF THE SALES PROCESS 8. Follow-up 7. Gaining Commitment 6. Meeting objections 5. Presentation 4. Need Assessment 3. Approach 2. Preapproach 1. Prospecting Copyright © 2003 by The Mc. Graw-Hill Companies, Inc. All rights reserved.

1) Prospecting: The method or system by which salespeople learn the names of people who need the product and can afford it. l Leads can be identified through… l Referrals from customers l Referrals from internal company sources l l Referrals from external agencies l l Sales manager; Marketing dept. ; Telemarketing dept. Go. Leads. com Published directories l Yellow Pages l Networking by the Salesperson l Cold canvassing Copyright © 2003 by The Mc. Graw-Hill Companies, Inc. All rights reserved.

Qualifying Leads l. A qualified prospect… l. Has a need for the products being sold. l. Can afford to buy the products. l. Is receptive to being called on by the salesperson. Copyright © 2003 by The Mc. Graw-Hill Companies, Inc. All rights reserved.

Lead Conversion Ratio: Inquiry to Decision 12 Months After Inquiring Plan to buy 25% No longer in market 30% TM 3 FIG. 3 -2 Purchased 45% *SOURCE: Bob Donath, James K. Obermayer, Carolyn K. Dixon, and Richard A. Crocker, “When Your Prospect Calls, ” Marketing Management, Vol. 3, No. 2, 1994. Copyright © 2003 by The Mc. Graw-Hill Companies, Inc. All rights reserved.

The Value of Inquiry Follow-Up TM 3(FIG. 3 -3) Share of buyer’s business if not followed up 40% Share of buyer’s business if followed up 83% *SOURCE: Bob Donath, James K. Obermayer, Carolyn K. Dixon, and Richard A. Crocker, “When Your Prospect Calls, ” Marketing Management, Vol. 3, No. 2, 1994. Copyright © 2003 by The Mc. Graw-Hill Companies, Inc. All rights reserved.

2) Preapproach: Planning the Sale l Includes all the information-gathering activities salespeople perform to learn relevant facts about the prospects, their needs, and their overall situation. l Adaptive selling: l When a salesperson alters the initial objectives or plans of the sales process because of new information gained from the customer during the actual call. Copyright © 2003 by The Mc. Graw-Hill Companies, Inc. All rights reserved.

3) The Approach: The first minute or so of the call. l. A good approach makes a favorable impression and establishes some degree of rapport between the salesperson and the buyer. l Expectations in the U. S. : Firm handshake l Professional attire l Good eye contact. l Copyright © 2003 by The Mc. Graw-Hill Companies, Inc. All rights reserved.

4) Need Assessment l. The stage in which the salesperson must discover, clarify, and understand the buyer’s needs. l. The best way to uncover and understand needs is by asking questions. Copyright © 2003 by The Mc. Graw-Hill Companies, Inc. All rights reserved.

NEED ASSESSMENT TM 3 -6 • Situational questions How often do you change the cutting oil in your drill presses? In addition to the hospital administrator, who else has an influence on the decision? • Problem discovery questions Have you experienced any delays in getting repair parts? In which part of the production process is quality control the most important? • Problem Impact questions How do these delays in getting parts affect your production costs? What impact do the quality consistency problems have on your production costs? • Solution value question If your inventories could be reduced by 20%, how much would that save you? If your rejection rate on final inspection was reduced to under one percent, how much would that save you? • Confirmatory questions So, you would be interested in an inventory control system that reduced your inventories by 20%? If I can provide evidence to you that our products would lower your rejection rate to under one percent, would you be interested? Copyright © 2003 by The Mc. Graw-Hill Companies, Inc. All rights reserved.

5) The Presentation l A discussion of those product and/or service features, advantages, and benefits that the customer has indicated are important. Built around a forceful product demonstration l Prepared presentation vs. Adaptive selling l Tips for effective presentations l l Keep it simple l Talk the prospects language l Stress the application of the product/service to the prospects situation l Seek credibility at every turn. Copyright © 2003 by The Mc. Graw-Hill Companies, Inc. All rights reserved.

TM 3 - Presentation of Product, Features, Benefits, Advantages Product Features Benefits Camera Telephoto lens Take pictures from longer distances. Able to capture images of animals or people from a distance. Bicycle bottle holder Attached water bottle. Can hold a water Don’t get dehydrated. Don’t have to stop for water. Feel more refreshed. Drill Press Multiple drill bits attached Can change bits without shutting down the machine. Saves time. Saves money. Motor Oil Rust inhibitor Oil and engine have longer life. Saves money. Copyright © 2003 by The Mc. Graw-Hill Companies, Inc. All rights reserved. Advantages

6) Meeting Objections l Objections should be welcomed because they indicate that the prospect has some interest in the proposition. l In responding to an objection… l Listen to the buyer l Clarify the objection l Respect the buyer’s concern l Respond to the objection l Common types of objections l Price or value objections l Product/service objections l Procastinating objections l Hidden objections Copyright © 2003 by The Mc. Graw-Hill Companies, Inc. All rights reserved.

7) Gaining Commitment l Asking the buyer to commit to some action that moves the sale forward. l Common l The Assumptive Close l l “Now what size do you want? ” Special Offer Close l l Sales Closes “If you buy this product today, we’ll double the length of the warranty. ” Summary Close “You have agreed that our product is the best on the market. Correct? Then I suggest that you place your first order today so we can have it to you by the end of the week. ” Copyright © 2003 by The Mc. Graw-Hill Companies, Inc. All rights reserved. l

8) Follow-Up l Reps must learn that the sale is not over when they get the order. l It is much more expensive to acquire new customers than it is to retain existing customers. l Following up to ensure that the customer is fully satisfied builds trust and is consistent with the concepts of Relationship Marketing. Copyright © 2003 by The Mc. Graw-Hill Companies, Inc. All rights reserved.