MKTG 430: CLASS ASSIGNMENT 2

LINZHI YU

CH062.pptx

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Selling Today

Fourteenth Edition

Chapter 6

Creating Product Solutions

ALWAYS LEARNING

Product Strategy Defined

“The product strategy is a well-conceived plan that emphasizes becoming a product expert, selling benefits, and configuring value-added solutions.”

e.g. Ritz Camera

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Strategic/Consultative Selling Model

FIGURE

6.1

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Tailoring the Product Strategy

Transactional Buyers	Consultative	Strategic Alliance
Standard or generic items	Hidden features	High cost importance
Understand their own product needs	Differentiated choices	Limited substitutability
Product can be easily substituted	Customizable

The product strategy should be tailored to the customer’s buying needs:

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Product Configuration

Product selection process is often referred to as “product configuration”

Product configuration software

Develops customized product solutions quickly and accurately (built your own bmw) my car

Incorporates customer selection criteria

Identifies options, pricing, delivery schedules

Can integrate with Customer Relationship Management applications

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Written Proposals

Many clients ask for written proposals and some provide detailed guidelines

Most written proposals include:

Budget and overview

Objective

Strategy

Schedule

Rationale

e.g. proposals prepared for consultancy work

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Becoming a Product Expert

Product development and quality improvement processes

Performance data and specifications

Maintenance and service contracts

Price and delivery

Be good in the following:

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Product Development and Quality Improvement

Development

Be familiar with product history

Know stages of product testing

Link key features and customer needs

Quality

Quality control involves measuring against standards

Extensive sales-force training is key element of quality control

6-8

Performance Data and Specifications

Most clients are interested in product performance and specifications

Salespeople must be prepared to answer performance-related questions

Data often critical when customer compares various products

Sales persons must have good product knowledge & be passionate about the products /services they are selling: Youtube video

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Maintenance and Service Contracts

Provide service-related information in proposal and/or at the time of sale

Understand customer’s service and maintenance requirements

Customized service agreements add value

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Price and Delivery

Clients expect salespeople to be well-versed in price and delivery policies

Giving salespeople price and delivery decision power yields strong position

Price objections often common barrier to closing the sale

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Quantifying the Solution

Process of determining if proposal adds value

Conduct a cost-benefit analysis using costs and anticipated savings

See Table 6.1 for an example (next slide)

Calculate a return on investment

Key decision makers respond favorably to ROI

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Cost-Benefit Analysis

TABLE

6.1

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Know Your Company

Salespeople sell their company as much or more than they sell a product

Organizational culture is a collection of beliefs, behaviors, and work patterns common to a firm’s employees

Many prospects use a firm’s past performance as index for current products/services

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Know Your Competition

Acquiring knowledge of the competition is an important step

Knowing strengths and weaknesses of competing products allows you to emphasize your benefits

Prospects do raise questions about competition—be prepared to answer

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Your Attitude Toward Your Competition

Avoid referring to the competition during sales presentations

Never discuss the competition unless you have your facts straight

Never criticize the competition

Be prepared to add value

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Be an Industry Expert

Salespeople need to become an expert in the industry they represent

Need to move beyond product specialist to business analyst

Knowledge of industry must be both current and detailed

e.g. Electrolux vacuum cleaner sales personnel are well-trained to provide information

about healthcare industry

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Sources of Product Information

Product literature, catalogs, web-based sources

Plant tours

Internal sales and sales support team

Customers

The product itself

Trade and technical publications

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Benefits Not Features

“I don’t think that we understood our real goal when we first started Federal Express. We thought that we were selling the transportation of goods; in fact, we were selling peace of mind.”

— Frederick Smith, founder of FedEx

Youtube video

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Features and Benefits

A feature is data, facts, or characteristics of your product or service

A benefit is whatever provides the customer with a personal advantage or gain

General benefits

Specific benefits

e.g. hybrid cars – MPG (feature) vs. $$ (benefit)

e.g. @50 miles a gallon for 1000 miles a month of usage, gas consumption is 20 gallons

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Adding Value with a Feature: Benefit Strategy

Successful sales presentations translate product features into benefits that meet a specific need

Only when a product feature is converted into a buyer benefit does it make an impact

e.g. Accounting Software

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Adding Value with a Feature: Benefit Strategy

Distinguish between features and benefits

Use bridge statements

Statements that connect features to benefits

Identify features and benefits

Avoid information overload

e.g. selling a new snack food: “This product has been advertised nationally (a feature) , which means you will

benefit from more pre-sold customers (a benefit) ”

e.g. “since this photocopier can copy documents so much faster that other leading brands (a feature), you will

benefit from more time and cost savings (a benefit) for your organization.

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Table 6.2 Feature–Benefit Worksheet

FEATURE	BENEFIT
Facilities	Blank
The hotel conference rooms were recently redecorated.	This means all your meetings will be held in rooms that are attractive as well as comfortable.
All our guest rooms were completely redecorated during the past 6 months and most were designated as nonsmoking rooms.	This means your people will find the rooms clean and attractive. In addition, they can easily select a nonsmoking room.
Food Services	Blank
We offer four different banquet entrees prepared by Ricardo Guido, who was recently selected Executive Chef of the Year by the National Restaurant Association.	This means your conference will be enhanced by delicious meals served by a well-trained staff.
Our hotel offers 24-hour room service.	This means your people can order food or beverages at their convenience.

Table 6.2 shows how salespeople employed by a hotel can enhance the sales presentation by converting features to benefits.

Table 6.3 Feature–Benefit Worksheet

FEATURE	BENEFIT
Our company has . . .	This means for you . . .
1. The best selection of motors in the area	Choice of the best models to interface with your current equipment Equipment operates more efficiently
2. Certified service technicians	Well-qualified service personnel keep your equipment in top running condition Less downtime and higher profits

Table 6.3 shows how company features are translated into customer benefits.