CHAPTER 2

Personal Selling: Preparation and Process

Learning Objectives
To understand

psychology in selling, buying decision process and buying situations To learn communication skills, sales knowledge, and sales related marketing policies To understand personal selling process To learn about negotiation

Psychology in Selling
Stimulus (Sales Presentation) Buyers decision making process Response (buy or no buy)

If a sales person makes a presentation, the

prospect may or may not buy The above buyer behaviour model does not tell us the reasons of buying or not buying To understand the psychological aspects of selling or buying, salespeople should study consumer or buyer behaviour, including buying process and situations

Buying Process of Consumers and Business Buyers

Five stage model for household customers 1. Problem / need recognition Eight stage model for business buyers 1. Problem / need recognition 2. Characteristics and quantity determination 3. Specification development

2. Information search / collection

4. Supplier search and qualification 5. Obtain and analyse supplier proposals

6. Evaluation and selection of suppliers 7. Selection of purchase order routine 8. Performance feedback and postpurchase evaluation

3. Evaluate alternatives 4. Purchase decision 5. Post purchase behaviour

Buying Situations Faced By

Household customers Routine decision-making Limited decision-making Extensive decision-making Business Buyers New task / New purchase Modified rebuy / change in supplier Straight rebuy / Repeat purchase

Buying process and situations differ for household consumers and business buyers. Consumers / Buyers may skip or reverse some stages in buying process. E.G. A consumer buying toothpaste

Knowledge of Sales and Sales-related Marketing Policies

Sales Knowledge Marketing Policies

Company knowledge
Product knowledge Customer knowledge Competitor knowledge

Pricing and Payment policies

Product policies Distribution policies Promotional policies

The Sales Process

As a part of selling activities, if salespeople follow the steps or phases shown below, their chances of success are far better.
Prospecting & Qualifying
Preapproach / Precall planning Approach Presentation & Demonstration Overcoming Objections

Follow-up & Service

Trail close / Closing the sale

The sequence of above steps may change to meet the sales situation in hand. We now discuss application of above steps to industrial selling

Prospecting
It is identifying or finding prospects i.e. prospective or

potential customers. Methods of prospecting or sales lead generation are: (1) referrals from existing customers, (2) company sources (website, ads., tradeshow, teleprospecting), (3) external sources (suppliers, intermediaries, trade associations), (4) salespersons networking, (5) industrial directories, (6) cold canvassing

Qualifying
Companies qualify sales leads by contacting them by mail

or phone to find their interests (or needs) and financial capacity. Leads are categorized as: Hot, Warm, and Cool

Preapproach
Information gathering about the prospect.

Sources of information: the Internet, industrial directories, government publications, intermediaries, etc. Precall planning
Setting call objectives Tentative planning of sales strategy: which products,

features and benefits may meet the customer needs

Approach
Make an appointment to meet the prospect Make favourable first impression

Select an approach technique: Introductory Customer benefit Product Question Praise The approach takes a few minutes of a call, but it can make or break a sale

Presentation and Demonstration

There are four components:
Understanding the buyers needs
Knowing sales presentation methods /

strategies Developing an effective presentation Using demonstration as a tool for selling

We will examine each of the above points

Understanding the buyers needs

Firms and consumers buy products / services to

satisfy needs To understand buyers needs, ask questions and listen In business situations, problem identification and impact questions are important

Knowing Sales Presentation Methods/Strategies

Firms have developed different methods / styles / strategies of sales presentation Stimulus response method / canned approach. It is a memorized sales talk or a prepared sales presentation. The sales person talks without knowing the prospects needs. E.G. Used by tele-marketing people Formula method / formulated approach. It is also based on stimulus response thinking that all prospects are similar. The salesperson uses a standard formula AIDA (attention, interest, desire, and action). It is used if time is short and prospects are similar.

Sales Presentation Methods (Continued)

Need satisfaction method
Interactive sales presentation First find prospects needs, by asking questions and

listening Use FAB approach: Features, Advantages, Benefits Effective method, as it focuses on customers
Consultative selling method / Problem-solving

approach
Salespeople use cross-functional expertise Firms adopt team selling approach It is used by software / consulting firms

How to develop an effective presentation?

Some of the guidelines are:
Plan the sales call
Adopt presentation to the situation and person Communicate the benefits of the purchase

Present relevant and limited information at a time

Use the prospects language Make the presentation convincing give evidence

Use technology like multi-media presentation

How demonstration can be useful in presentation?

Sales

presentation can be improved by demonstration Demonstration is one of the important selling tools EGs: Test drive of cars; demonstration of industrial products in use Benefits of using demonstration for selling are:
Buyers objections are cleared Improves the buyers purchasing interest Helps to find specific benefits of the prospect The prospect can experience the benefit

How to overcome sales objections?

Sales objections are the reasons given by

customers for not purchasing the product after completion of the demonstration by the sales person. It is generally raised while asking the final order. There are two types of objections
Psychological / hidden Logical (real or practical)

Methods for handling and overcoming objections:

(a) ask questions. (find out what is the exact

problem?) (b) turn an objection into a benefit. ( Convince customer that actually his short term problem is long term benefit) (c) deny objections tactfully. ( refuse objection by some prepare logic in humble manner) (d) third-party certificate. (give reference of the person who has taken your product & he is satisfied)
(e) compensation

(keep comparison of competitors' ready specially when you feel that objections are coming because of the competitors' product)

Trial close and Closing the sale

Trial close checks the attitude or opinion of the

prospect, before closing the sale (or asking for the order) If the response to trial close question is favourable, then the salesperson should close the sale Some of the techniques used for closing the sale are: (a) alternative-choice, (b) minor points, (c) assumptive, (d) summary-of-benefits, (e) Taccount, (f) special-offer, (g) probability, and (h) negotiation

Follow-up and Service

Necessary for customer satisfaction

Successful salespeople follow-up in different

ways: For example,

Check order details

Follow through delivery schedule

Visit when the product is delivered Build long-term relationship Arrange warranty service

Negotiation
Salespeople, particularly in business to business selling, need

negotiating skills When to negotiate? (a) When the buyer puts certain conditions for buying to the seller, (b) When agreement between the buyer and the seller is needed on several factors, (c) When the product is customized, (d) When the final price is to be decided How to prepare for negotiation? (a) planning : Gather the information about almost all aspects about competitors' product, including the price of the product, after sales service, flexibility in the payment terms, maximum limit of the discounts etc. (b) building relationship: Use the available time to build good relationship with customer not to have just a good relation but also to get certain information about the need of the customer. Many times sales person wins the deal just because of good relations.

(c) purpose: The purpose of the negotiation may be several & depends on the situation & demand of the time but mainly it takes place to have one common price point of the product.
Styles of negotiation

(a) I win, you lose, (b) Both of us win (or winwin style), (c) You win, I lose, and (d) Both of us lose
The best style of negotiating is win- win style, which is generally used to have deal with customers, suppliers even some times with

 Some times it also happens that a sales person

has to take care that this negotiation should not be converted in to the EGO oriented debate if it is being so they have to adopt the You win I lose strategy The sales people should recognize the customer uses I win u lose strategy.
The buyer starts with tough demands & ridicules offer. The buyer raises the voice The buyer ignores the time deadline

Some times after knowing the situation given

above if sales person tries to convert above situation in to win-win situation & he fails than some times a sales person also have to take

 Making strong position by presenting clear but unemotional

opposition to the prospects demand. He must explain that why he is holding his position & not able to fulfill customers demand A sales person should also explain that how customer will be having loss by not making this deal done.

All this points are difficult to remember & apply while doing practical sales call but one can have the efficiency in it by practicing for the same.