23646919 personal selling

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Prof. A. K. Biswas 1


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FRAMEWORK OFMARKETING

UnderstandingMarket Opportunities

Understandin

gCompany

Capabilities

UnderstandingCustomer Value &

Segmenting Customers

UnderstandingCompetitor and

CompanyCapabilities

Understanding

Market & MarketingEnvironment

Understanding

CompetitorCapabilities

SelectingMarket

Segment


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Developing CompetitiveMarketing Strategy

Developing

Value Proposition,Positioning Strategy

Developing &Managing

Market Offering:Product & Price

Designing andManaging

Marketing Channels

FRAMEWORK OFMARKETING


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CommunicatingMarket Offering

Personal Selling

Managing LongTerm

Customer Value

Managing and MeasuringMarketing Effort

FRAMEWORK OF

MARKETING


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What Is Selling?Essentially, selling is theprocess ofpersuasion.

All occupations require sellingskill.

The actual art of selling haslittle to do with specificfeatures or products and muchmore to do with the art of

persuasion.


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What Is PersonalSelling?

Personal selling is defined as sellingthat involves a face-to-faceinteraction with customers.



When Personal Selling

Is Important? In general, when there are few

customers. Furthermore, when each customer

purchase products and services inlarge quantities.

When the products/services are

complex and the customers requiretechnical support. When customers prefer closer

working relationships with

suppliers.



Four Approaches To

Selling

There are four distinct ways to sell:

Transaction Selling Systems Sales

Key Account Management

Strategic Account Relationships



Transaction Selling

Transaction selling involvessalespersons calling on customers,making presentations, asking fororders, and making after-sale calls.

The sale is either a one-timeexchange or one transaction in acontinuing series of exchanges.

The product is often purchased onthe basis of physical attributes,availability, convenience, or price.



Systems Sales

The selling of complex systemsrequire that the transaction

approach is supplemented by moreconcern for customer benefits andintegration of system components.

The system consists of separate

pieces, including individualequipment, parts, supplies, andservices.



Systems SalesThe systems sale necessitatesthe introduction and

development of new salestechniques such as teamselling, in which several

departments of functionalareas (applicationsengineering, design, fieldservice, etc.) of the supplierbecome involved in the sales


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Systems Sales

The systems sales differs in

size and complexity from thetransaction sale, but the heartof the activity remains thesales transaction.


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Senior management in manycorporations now realizes that,across the customer base, notall customers are equal: somecustomers are more valuable

than others.

Key AccountManagement


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Customer Potential AndCustomer Demands

Size ofcustomer

Number ofcustomers Total salesvolume

Customerpotential

Amount ofproduct & servicecustomization

Customer

demands

Large

Medium

Small

The Three Triangles


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The high current (and potential)volume (and profit) customers are

the firms critical assets. They are not visible on the firms

balance sheet, yet they are moreimportant to long-run survival andgrowth than many of the firmsfixed assets.


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Both the high value of, and increasedcompetition for, this special set ofcustomers suggests that they should betreated differently from the firmsaverage customers.

This compelling rationale has led manyfirms to the development ofkey accountmanagement programs.



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The key account management bothfocuses the firms attention on thoseaccounts that are especially important

for its current and long-run future, andoptimizes the use of scarce resources.

It provides for the development ofmore complete information and

analysis of customers strategicrealities, critical needs and buyingprocesses, competitive threats, andimportant supplier firm resources.



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In key account management, the majoraccount responsibility typically restswith a key account manager.

Managers works with colleagues inother functional departments (includingthe sales force) as leaders in keyaccount teams and have primary

responsibility for the long-run health ofthe relationship.


B fit Of K A t


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Benefits Of Key AccountPrograms For Supplier

Firms Improved understanding of the

key accounts goals, andrequirements.

Increased key accountswitching costs.

Better understanding andmanagement of the keyaccount.

Presentation of a company


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A single point of contact.

Lower costs of securing input

products. Enhanced value

Guaranteed delivery whencapacity is short.

Long-term relationship.

Benefits For Key

Accounts


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Key account management is expensiveand difficult. It can only be used formajor customers.

It must be seen as a philosophy ofcustomer commitment, not just acollection of advanced persuasiontechniques.

Its essence is superior customer

responsiveness based on outstandingsupport systems. It goes beyondselling and has laid the foundation forstrategic account relationship.

Key Account

Management


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Strategic Account

Relationships Key account management, with all

of its opportunities and rewards, aswell as significant investments and

costs, cannot satisfy the evolvingneeds for some closer, morepermanent vendor-customerrelationships.

Joint product, service, andinfrastructure developments haveled to even more intimate buyer-seller relationships, which can be

described as strategic account


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Strategic account relationships mustalways be based on three attributes: Importance, which involves three

forms of interdependence:financial, technological and/ordesign, and strategic.

Intimacy, which enables sharing of

intimate technological, design, andoperating information. Longevity, which is necessary to

protect the intimacy, and to

enable the partners to reap thefinancial rewards.

Strategic Account

Relationships

Appropr ateness O


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Appropr ateness ODifferent Sales

Approaches The transaction and systems

approaches emphasize sales,

while the key account andstrategic relationshipapproaches emphasize themutuality of long marriage.

The relative amount of vendoreffort also increases as we movefrom transaction selling tostrategic account selling.

Appropr ateness O


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Given the difference among

the four different salesapproaches in cost and impact,it is appropriate to considerwhich accounts and prospects

might be appropriate for eachapproach.


Approaches

Appropr ateness O


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The following factors should beconsidered for this purpose:

Size of the customerSales potential of the customerProfitability of the customerNeeds of the customer for

product and servicecustomizationVendor rewards beyond salesvolume and profits


Approaches


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Customer CenteredSelling

The purpose of business iscreation of customers at a profit.

Customer being the mostimportant thing in business,selling process must be centeredaround the customer.

A seller must, therefore, firststudy the decision-makingprocess the customers go

through.


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The key concept of CustomerCentered Selling is to learn to

analyze where your customersare in the decision cycle andassist in moving them through

a decision. In doing this you must must

learn what tactics are

appropriate for which part of

Customer CenteredSelling


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Customer Centered

Decision Cycle

Customer

Satisfaction

Acknowledgment

Decision

CriteriaMeasurement

Investigation

Selection

Reconsideration


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Satisfaction stage representsthe beginning of the customerdecision cycle.

In this stage of the cycle, thecustomers are convinced they

not only have no needs, theyhave no problems either.

Customer Centered

Decision Cycle


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The acknowledgment stagerepresents the most critical

element of the decision cycle. In this stage the customer will

admit that he does have

particular problems but hedoes not want to do anythingabout these problems at this

time.

Customer Centered

Decision Cycle


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According to some research

done in US, about 80% ofcustomers are in this stage.

Two things keep customersparalyzed in theacknowledgment stage.

Customer Centered

Decision Cycle


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Often the small problems thecustomer was facing for

sometime mount up until hebecomes fed up and begins tolook for alternatives.

Sometimes the problem that thecustomer has been living withsomehow becomeunmanageable.

This stage may be called decision

Customer Centered

Decision Cycle


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Once the customers cross the firstdecision point, they immediatelymove into criteria stage.

Customers do not make decisionsbased on needs; they makedecisions based on problems.

The bigger the problem, the biggerthe need. The bigger the need, the more the

customers are willing to pay.

Customer Centered

Decision Cycle


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The next stage that customersgo through in the decision

cycle, consciously orunconsciously, is themeasurement stage.

The measurement stageprovides the customer with theopportunity to move from the

vague to the specific.

Customer Centered

Decision Cycle


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Next the customer moves tothe investigation stage. In this

stage, the customer is tryingto accomplish two things.

First, he will methodically

apply the list of criteria toeach and every product underconsideration.

Customer Centered

Decision Cycle


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The second task the customersaccomplish in this phase of the

decision cycle involves thedegree to which they will shopout their selection.

At this point in the cycle,various solutions areeliminated based on theirability to meet the prescribed

criteria.

Customer Centered

Decision Cycle


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At the selection stage of the

decision cycle, the customermust be convinced that theselection he has made in fact

addresses all his needs.

Customer Centered

Decision Cycle


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The customer does not stay in

the selection stage for long.The customer moves on andheads on to thereconsideration stage,sometimes referred to asbuyers remorse'.

Customer Centered

Decision Cycle


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Customer Centered

Selling Cycle Selling is the process of

persuasion. This process ofpersuasion is for those who donot necessarily want to besold.

Customer Centered Selling

process is designed to spellout every move a salespersonneed to make to persuade acustomer to buy his solution.


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Customer

Satisfaction

Acknowledgment

Decision

CriteriaMeasurement

Investigation

Selection

Reconsideration

Seller

Research

Analysis

Confirmation

RequirementSpecification

Solution

Close

Maintenance

Cycle


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At the research stage of theselling cycle the objective is to

study the customers world. The first type of question that is

used in the research stage is

background probe. It is used toobtain basic information that willallow to learn about a customerscurrent situation.

Customer Centered

Selling Cycle


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Identifying Probes: When youare using this first probe, you

must get the customer toidentify or agree there is aproblem.

Most customers, early on,resist admitting a problem. Ifthey do, they often will not

admit to the size of the

Customer Centered

Selling Cycle


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Developing Probes: The way youdevelop a problem is to continue toask questions about it.

Once a problem has beenestablished, stop allowing yourcustomers run away from it.

People do not look at the impact ofmany of their problems. You mustlearn to get the customer to lookdown the road a bit at hisproblems. This is done by using

developing probes.

Customer Centered

Selling Cycle


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For Want of a Nail

For want of a nail, a shoe was lost

For want of a shoe, a horse was lostFor want of a horse, a rider was lost

For want of a rider, a message waslost

For want of a message, a battle waslost

For want of a battle, a war was lost

And all that for want of a nail..

- Ben Franklin


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Neil Rackham suggests fourtypes of questions that provide a

probing sequence which you canuse in planning and executingcalls to help you to meet yourobjectives at the research and

analysis stage. The initials of each type of

question give the acronym

SPIN.

Customer Centered

Selling Cycle


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SPIN selling is a techniqueinvolving a logical sequence of

questions about situations,problems, implications, andneed payoff that salespeople

use to uncover the prospectsimplied needs and developthem into explicit needs.

Customer Centered

Selling Cycle


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Implied needs are vaguely definedareas of discontent,

dissatisfaction, and discomfortwith current situations.Through the spin questions, thesalesperson develop these implied

needs into explicit needs.Explicit needs are precisespecifications of products andaugmenting services that resolve

the customers problems.

Customer Centered

Selling Cycle


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If the probing sequence hasbeen performed properly, thecustomer should not only beready for change, but thereshould be a sense of urgency

to make change. This is the confirmation stage.

Customer Centered

Selling Cycle


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If the customer says yes, you havebeen given the green light to moveforward.

If the customer says no, you haveto understand why the person doesnot want to move forward andchances are that you will have tomove back to the analysis stageonce again.

This step represents your first trialclose. The biggest benefit to trialcloses is their ability to flush out

Customer Centered

Selling Cycle


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Within the decision cycle, thecustomer quite naturally wants

to begin figuring out what itwill take to fix his existingproblems.

The seller must parallel thatposition and work with thecustomer to determine what

these requirements would be.

Customer Centered

Selling Cycle


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The specification stage is importantto the seller because whencustomers are unclear incommunicating their buyingcriteria, they often expose thesalesperson as well.

There are two steps at this stage: Transfer the customers

requirements over tospecifications.

Commit the customer to these

Customer Centered

Selling Cycle


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At the solution stage, you musttie your product/servicerecommendation carefully tocustomers needs.

This can be done in an effectivemanner through the use of the

concept of FABEC feature,advantage, benefit, explanation,and confirmation.

Customer Centered

Selling Cycle


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Start with feature or features thataddress the customers mostimportant criteria and stay in that

prioritized order. Bring out the advantageof each of

the feature.

The benefit is the specific value tothe customer. The benefits, and notthe feature, are what yourcustomer is using to base adecision on.

Customer Centered

Selling Cycle

CYCLE


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Focus of Sales Presentation Example

Features and Advantages Our machine runs twice asfast as your current equipment.

Benefits Our machine will allow youto increase your productionoutput over current levels.

Worth By increasing your productionoutput, our machine willenable your firm to increaseannual revenue by Rs..500,000

CYCLE[The Solution Stage]


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With the solution presented,explained, and confirmed, it is

finally the time to close. When closing, the goal is to

close for the highest realisticlevel of commitment.

The summary close processhas four steps.

Customer Centered

Selling Cycle


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Step 1. Confirm Benefits: The firststep of the summary close is onelast check with your customer to

find out whether your solution dideverything that he said he wantedit to do.

By confirming benefits, you are

actually trial-closing the customer.This step forces out any remainingobjections which then can behandled appropriately.

Customer Centered

Selling Cycle


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Step 2. Ask for Commitment: Your strategy here should be to

close for the highest realisticlevel of commitment.

How do you ask for commitment?

Do it as simply as possible. Anexample:

I would love to have yourbusiness.

Customer Centered

Selling Cycle


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Step 3. Discuss Logistics: With

the commitment in hand, youmust stay focused and workout the logistics to implementthe sale you have just made for items like delivery,training, and follow-up.

Customer Centered

Selling Cycle


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Step 4. Reassure theCustomer:

The solution you haverecommended may very wellcost more than he is already

paying. Reassure him that he has

made a wise decision and your

company would provide all

Customer Centered

Selling Cycle


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At this stage, which can be calledMaintenance or Development Stageyou need to monitor your sale.

There are three steps which willhelp this process. These are fairlygeneric and should apply towhatever solution you and your

customer have agreed to. Review Logistics Review the Solution

Review the Change

Customer Centered

Selling Cycle


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Five simple strategies at theMaintenance or Development

Stage: Develop, do not maintain. Document the good news. Generate leads and references. Reassess your understanding of

customer needs. Influence future decision criteria.

Customer Centered

Selling Cycle


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Sales Negotiation

Negotiation should never be asubstitute for selling.

When you are selling you donot give anything away. Think of negotiation as

something which will only beeffective after you have donethe best possible job of selling.


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Dont negotiate early in theselling cycle. Negotiate late.

Dont try to negotiate your wayout of consequence issues ornon-specific concerns.

Consequence issues are to be

resolved by discussion andconfidence building, not bybargaining and negotiation.

Sales Negotiation


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Refine your lower limit in thesame way so that you mayarrive at a realisticnegotiating range.Start at or near the top of

your range, makingconcessions in increasinglysmaller increments until youreach an agreement.

Sales Negotiation


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Separate understanding fromagreement:

Throughout the negotiation,continually test and probe thatboth parties clearly

understand the areas ofagreement and disagreement.

Sales Negotiation


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Never allow misunderstandingsto persist:Never be afraid to probe and exploreareas where the customer may havemisunderstood what you are offering.It is much earlier to deal withmisunderstanding before theagreement than afterward when anangry customer feels cheated.

Sales Negotiation


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23646919 personal selling

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