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CH17_PersonalSellingCONTENTforWORDDOCUMENT.pptxPersonal Selling and Sales Management
Chapter 17
Learning Goals
Describe personal selling
Discuss the key differences between relationship selling and traditional selling
Describe customer relationship management
List the steps in the selling process
Describe the functions of sales management
Personal Selling
Goal #1 Describe Personal Selling
What is Personal Selling?
Personal selling is direct communication between a sales representative and one or more prospective buyers in an attempt to influence each other in a purchase situation.
Broadly speaking, all businesspeople use personal selling to promote themselves and their ideas.
Goal #1 Describe Personal Selling
Advantages of Personal Selling
Personal selling provides detailed explanation or demonstration of the product.
Message can be varied according to motivations of each customer.
Personal selling can be directed only to qualified prospects.
Costs can be controlled by adjusting the size of the sales force in one-person increments.
Personal selling is considerably more effective than other forms of promotion in obtaining a sale and gaining a satisfied customer.
Goal #1 Describe Personal Selling
Exhibit 17.1 – Comparison of Personal Selling and Advertising/Sales Promotion
| Personal selling is important if… | Advertising and sales promotion are more important if… |
| The product has a high value. | The product has a low value. |
| It is a custom-made product. | It is a standardized product. |
| There are few customers. | There are many customers. |
| The product is technically complex | The product is easy to understand. |
| Customers are concentrated | Customers are geographically dispersed. |
| Examples: Insurance policies, custom windows, airplane engines | Examples: Soap, magazine subscriptions, cotton t-shirts |
Relationship Selling
Goal #2 – Discuss key differences between relationship selling and traditional selling
Relationship Selling
Relationship Selling
The practice of building, maintaining, and enhancing interactions with customers in order to develop long-term satisfaction through mutually beneficial partnerships
Traditional Selling
Transaction focused. That is, the salesperson is most concerned with making one-time sales and moving on to the next prospect.
Goal #2 – Discuss key differences between relationship selling and traditional selling
Relationship Selling
Until recently, personal selling focused almost entirely on a planned presentation for the purpose of making a sale. In contrast, modern views of personal selling emphasize the relationship that develops between a salesperson and a buyer.
The objective with relationship selling is to build long-term branded relationships with consumer/buyers. The focus is on building mutual trust between the buyer and seller.
Salespeople become consultants, partners, and problem solvers as they strive to develop trust and long-term relationships.
Personal selling has taken a technological turn in the last decade.
The end result of relationship selling tends to be loyal customers who purchase from the company time after time. A relationship selling strategy focused on retaining customers costs a company less than prospecting and selling to new customers.
Exhibit 17.2 – Key Differences in Traditional and Relationship Selling
| Traditional Personal Selling | Relationship or Consultative Selling |
| Sell products (goods and services) | Sell advice, assistance, and counsel |
| Focus on closing sales | Focus on improving the customer’s bottom line |
| Limited sales planning | Consider sales planning as top priority |
| Spend most contact time telling customers about product | Spend most contact time attempting to build a problem-solving environment with the customer |
| Conduct “product-specific” needs assessments | Conduct discover in the full scope of the customer’s operations |
| “Lone wolf” approach to the account | Team approach to the account |
| Proposals and presentations based on pricing and product features | Proposals and presentations based on profit impact and strategic benefits to the customer |
| Sales follow-up is short term, focused on product delivery | Sales follow-up is long term, focused on long-term relationship enhancement |
Customer Relationship Management and Personal Selling
GOAL #3 Describe Customer Relationship Management
Customer Relationship Management
Customer relationship management assumes two key points:
Customers must take center stage in the organization.
The business must manage the customer relationship across all points of customer contact throughout the organization.
GOAL #3 Describe Customer Relationship Management
Customer Relationship Management
GOAL #3 Describe Customer Relationship Management
13
Identify customer relationships
Understand interactions of the customer base
Capture customer data
Leverage customer information
13
Chapter 17 Personal Selling and Sales Management
Identify Customer Relationships
Companies that have CRM systems:
Follow a customer-centric focus or model
Use knowledge management systems (the process by which customer information is centralized and shared in order to enhance the relationship between customers and the organization)
Organize information gathered through the “learning” process
Learn through interactions (he point at which a customer and a company representative exchange information and develop learning relationships)
GOAL #3 Describe Customer Relationship Management
Interactions of the Current Customer Base
CRM is built on interactions between customers and organizations.
Touch points occur at a wide variety of locations.
Touch points are all areas of a business where customers have contact with the company and data might be gathered
Web-based interactions are an increasingly popular.
One popular touch point is the point-of-sale touch point.
GOAL #3 Describe Customer Relationship Management
Capturing Customer Data
Rather than focusing on the amount of data that can be obtained, companies should focus on the type of data to be acquired and how it can be used to enhance relationships
GOAL #3 Describe Customer Relationship Management
Leveraging Customer Information
GOAL #3 Describe Customer Relationship Management
Campaign management
Retaining loyal customers
Cross-selling other
products and services
Designing targeted marketing communications
Steps in the Selling Process
GOAL #4 Identify The Steps In The Selling Process
The Selling Process
GOAL #4 Identify The Steps In The Selling Process
Completing a sale requires several steps.
It can be unique for each product or service, depending on the features of the product, characteristics of customer segments, and internal processes within the organization, such as how sales leads are generated.
GOAL #4 Identify The Steps In The Selling Process
20
Steps in the Selling Process
Generate Leads
Qualify Leads
Probe Customer Needs
Develop Solutions
Handle Objections
Close the Sale
Follow Up
20
Chapter 17 Personal Selling and Sales Management
Generating Leads
GOAL #4 Identify The Steps In The Selling Process
Advertising
Webinars
Referrals
Trade Shows/
Conventions
Direct Mail
Networking
Telemarketing
Social Media
Cold Calling
Lead generation, or prospecting, is the identification of those firms and people most likely to buy the seller’s offerings.
Qualifying Leads
GOAL #4 Identify The Steps In The Selling Process
Receptivity and accessibility
Buying power
Recognized need
When a prospect shows interest in learning more about a product, the salesperson has the opportunity to “qualify” the lead by determining if the prospect has three things:.
Approaching the Customer and Probing Needs
GOAL #4 Identify The Steps In The Selling Process
Before approaching customers, the salesperson should learn as much as possible about the prospect’s organization and its buyers. This process, called the pre-approach, describes the “homework” that must be done by the salesperson before contacting the prospect.
The salesperson’s ultimate goal during the approach is to conduct a “needs assessment” to find out as much as possible about the prospect’s situation.
A needs assessment is the determination of the customer’s specific needs and wants and the range of options a customer has for satisfying them.
The Consultative Salesperson
GOAL #4 Identify The Steps In The Selling Process
Product or service
Customers
Competition
Industry
Salesperson
must know
everything
about...
Developing Solutions
After compiling information about the client’s needs and wants, the salesperson develops a solution in which the salesperson’s product or service solves the client’s problem or need.
These solutions are typically presented as a sales proposal during a formal sales presentation.
Usually, there is only one opportunity to present solutions, and salespeople must be able to present the proposal and handle any customer objections confidently and professionally.
Developing and Proposing Solutions
GOAL #4 Identify The Steps In The Selling Process
The Sales Proposal is…
A formal written document or professional presentation that outlines how the salesperson’s product or service will meet or exceed the prospect’s needs.
The Sales Presentation is…
A formal meeting in which the salesperson presents a sales proposal to a prospective buyer.
Handling Objections
The salesperson should not take objections personally as confrontations or insults. Instead, sales presenters should:
View objections as requests for information.
Anticipate specific objections.
Investigate the objection with the customer.
Be aware of competitors’ products.
Stay calm.
Use the objection to close the sale.
GOAL #4 Identify The Steps In The Selling Process
28
Closing the Sale
Negotiate
Keep an open mind
Look for customer signals
Tailor to each market
GOAL #4 Identify The Steps In The Selling Process
28
Notes:
Negotiation plays a key role in closing the sale. Negotiation is the process during which both the salesperson and the prospect offer special concessions in an attempt to arrive at a sales agreement.
A salesperson should emphasize value to the customer, rendering price a nonissue.
In foreign markets, the sales efforts should be tailored to the appropriate way of doing business for that culture.
Chapter 17 Personal Selling and Sales Management
Following Up
The goal of relationship selling is to motivate customers to purchase again by developing long-term relationships.
Most businesses depend on repeat sales, and repeat sales depend on follow-up by the salesperson.
Plus, today’s customers are less loyal to brands and vendors. Therefore, follow-up is critical in relationship building.
In the final step of the selling process—the follow up—the salesperson must ensure:
Delivery schedules are met
Goods or services perform as promise
Buyers’ employees are properly trained to use the products
Exhibit 17.5 Relative Amount of Time Spent in the Key Steps of the Selling Process
Sales Management
GOAL #5 – Describe the functions of Sales Management
Sales Management
GOAL #5 – Describe the functions of Sales Management
Sales managers must:
Define sales goals and the sales process
Determine the sales force structure
Recruit and train the sales force
Compensate and motivate the sales force
Evaluate the sales force
An old adage: In business that nothing happens until a sale is made. Without sales, there is no need for accountants, production workers, or even a company president. Sales provide the fuel that keeps the corporate engines humming.
Sales Goals and the Sales Process
GOAL #5 – Describe the functions of Sales Management
Without goals to achieve, salesperson performance would be mediocre at best, and the company would likely fail.
A quota is a statement of the salesperson’s sales goals, usually based on sales volume alone but sometimes including key accounts (those with greatest potential), new accounts, repeat sales, and specific products.
Sales goals provide salespeople with targets and measurements.
Usually goals are developed in terms of desired dollar values, market share, or profit level.
Goals are stated as quotas, or statements of a salesperson’s goals.
Structure of Sales Force
GOAL #5 – Describe the functions of Sales Management
Personal selling is an expensive way to market products. Having a well-organized sales force can make the process easier and less costly.
Sales department organization:
Regional
Product Line
Marketing Function Performed
Market or Industry
Client or Account
Allows for more specific and better customer service
The Sales Force
35
Strong Ego
Sense of Urgency
Assertiveness
Sociable
Risk Taker
Intelligent
Creative
Empathetic
Relationship Oriented
35
Chapter 17 Personal Selling and Sales Management
Compensating the Sales Force
The right type of compensation can reduce employee turnover.
Compensation planning is one of the sales manager’s toughest jobs.
Only good planning will ensure that compensation attracts, motivates, and retains good salespeople.
Although the compensation plan motivates a salesperson to sell, sometimes it is not enough to produce the volume of sales or the profit margin required by sales management.
Evaluating the Sales Force
To evaluate a sales force, the sales manager needs feedback — that is, regular information from salespeople.
Typical performance measures include sales volume, contribution to profit, calls per order, sales or profits per call, or percentage of calls achieving specific goals such as sales of products that the organization is strongly promoting.
Performance evaluations allow managers to review the strengths and weaknesses of the sales force.
This information can then tell a manager what sales skills might need to be reassessed or retrained.
Impact of Technology on Personal Selling
Technology will not eliminate the need for salespeople; instead, technology can help improve the customer relationship.
Technology, such as laptops, smart phones, and iPads allow salespeople to be more accessible to the customer.
The Internet provides salespeople with vast resources of information on clients, competition, and the industry.
The Internet is cost-effective in processing orders and services requests, and is freeing sales representatives from tedious administrative tasks to allow more time to focus on client needs.
Review
When compared to other forms of promotion, personal selling:
is more important as the number of potential customers increases.
is more effective in selling frequently purchased products.
can use a message customized to the immediate needs of the customers.
is best for selling simple, low-involvement products.
is less expensive.
Personal selling is more important than advertising and sales promotion if:
the products being sold are standardized.
there are many customers for the product being sold.
the product being sold has a low value.
the buyers of the product are extremely dispersed.
the products being sold are technically complex.
Review
Generally speaking, personal selling becomes more important as the number of potential customers and as the value of the product .
increases; grows
increases; shrinks
decreases; shrinks
decreases; grows
None of the above.
is a sales practice that involves building, maintaining, and enhancing interactions with customers in order to develop long-term satisfaction through mutually beneficial partnerships.
Networking
Adaptive selling
Stimulus-response selling
Relationship selling
Needs-dependent selling
Review
Relationship selling:
is also called adaptive selling.
is most concerned with making a sale.
is more typically used when selling low-involvement products in the consumer market.
is more concerned with developing customer trust than with making a sale.
is declining in popularity among businesses because the costs are becoming prohibitive.
Research has shown that positive customer–salesperson relationships result in:
win–lose situations.
decreased customer trust.
customers who purchase from the company just once.
higher costs for the company.
None of the above.
Review
Consultative selling:
uses limited sales planning.
uses a “lone wolf” approach to selling.
sells advice, assistance, and counsel rather than products.
uses short-term follow-ups, which focus on product delivery.
emphasizes closing the sale during the sales presentation.
in a CRM environment involves collecting customer information through comments and feedback on product and service performance.
Uncovering
Researching
Learning
Recording
Absorbing
Review
involves delegating authority to sales staff in order to solve customers’ problems.
Consumer learning
Customerization
Empowerment
Autonomy
Interaction
is the process by which learned information from customers is centralized and shared in order to enhance the relationship between customers and the organization.
Knowledge management
Learning
Database marketing
Interactive marketing
Information marketing
Review
Communications between customers and organizations that occur in stores or at information kiosks are called:
live interactions.
point-of-sale interactions.
empowerment points.
survey interactions.
product interactions
Every time Bart orders running shoes from Road Runner Sports, the Web site or the operator on the phone always tries to sell him something in addition to the shoes he ordered, such as socks or other apparel. This is an example of:
data mining.
cross-selling.
trading up.
database enhancement.
a database channel.
Review
The set of steps a salesperson goes through to sell a particular product is called the:
P-O-S cycle.
stimulus-response hierarchy.
sales presentation.
sales process.
sales continuum.
The first step in this process is:
qualifying leads
approaching the customer and probing needs
developing and proposing solutions
making a sales presentation
generating leads
Review
What is needed for sales management to be effective?
Impersonal relationships with customers.
A success-oriented sales force.
Relaxed sales objectives.
Extensive advertising campaigns.
Answers B and D.
When salespeople use price as their go-to tool for negotiation, they may inadvertently:
decrease the value of the product.
increase the value of the product.
render price a nonissue.
reinforce product advertising.
None of the above.
Review
is a process of finding out about potential clients from friends, business contacts, coworkers, acquaintances, and fellow members in professional or civic organizations.
People surfing
Networking
Co-opting
Lead intermediation
Looking for the golden parachute
___involves determining which sales prospects have a recognized need, buying power, and receptivity and accessibility.
Prospect examination
Customerization
Lead reciprocity
Lead qualification
Bird-dogging
Review
A _____is a determination of the customer’s specific needs and wants and the range of options the customer has for satisfying them.
stimulus-response continuum
needs hierarchy
needs assessment
NASIC comparison
sales probability
Creating a(n) during a sales approach helps salespeople optimize their time and resources.
sales proposal
customer profile
sales presentation
forecast of needs
AIDA assessment
Essay Review
Shelby is a salesperson for Kohler, a company that sells plumbing fixtures. He has a prospect who is showing interest in learning more about his company’s products, so now he must qualify this sales lead. What will Shelby do? (see page 322)
Tremaine Hughes is a salesperson for Allied Pets, a company that sells veterinarian supplies. He is working on a needs assessment for East Athens Veterinary Clinic. What information will he need to find out about East Athens? (See page 323-4)
List the seven steps in the personal selling process. (See pages 320-6)
