No 2 salespersons use exactly the same sales method, but it is generally a seven step process:
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1. Prospecting and Evaluating
Seek names of prospects through sales records, referrals etc., also responses to advertisements. Need to evaluate if the person is able (Undergraduate degree to attend a graduate program), willing and authorized to buy. Blind prospecting-rely on phone directory etc.
2. Preapproach (Preparing)
Review key decision makers esp. for business to business, but also family assess credit histories
prepare sales presentations
identify product needs.
Helps present the presentation to meet the prospects needs.
3. Approaching the Customer
Manner in which the sales person contacts the potential customer. First impression of the sales person is Lasting and therefore important. Strive to develop a relationship rather than just push the product. Can be based on referrals, cold calling or repeat contact.
4. Making the Presentation
Need to attract and hold the prospects Attention to stimulate Interest and stir up Desire in the product so the potential customer takes the appropriate Action. AIDA Try to get the prospect to touch, hold or try the product. Must be able to change the presentation to meet the prospect needs. Three types of presentations:
Stimulus Response Format: Appropriate stimulus will initiate a buy decision, use one appeal after another hoping to hit the right button…Counter Clerk @ McDonald’s “Would you like fries with your burger?” Formula Selling Format: (Canned Sales Presentation) memorized, repetitive, given to all customers interested in a specific product. Good for inexperienced sales people.
Better with heavily advertised items that are presold.
Telemarketing a credit card!!
Need Satisfaction Format: Based on the principal that each customer has a different set of needs/desires., therefore the sales presentation should be adapted to the individual customer’s needs, this is a key advantage of personal selling vs. advertising. Sales person asks questions first, then makes the presentation accordingly. Need to do homework, listen well and allow customers to talk etc. Must answer two types of questions:
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Seek out objections and address them.
Anticipate and counter them before the prospect can raise them. Try to avoid bringing up objections that the prospect would not have raised. Price objection is the most common
Need to provide customers with reasons for the $s, build up the value before price is mentioned Must be convinced of price in own mind before you can sell to customer. Get budget info. on buyer before you try to sell, and must know what they want, must sell service on top of product augmented product–to create value!! Must know value of product, provide warranties etc.!!
Ask prospect to buy product/products. Use trial closes, IE ask about financial terms, preferred method of delivery. 20% sales people generally close 80% sales., Avon, over 1/2 US $1.4 bn business from 17% of 415,000 SRs. Need to be prepared to close at any time. The following are popular closing techniques: Trial Close (Minor decision close)
Assumptive close (Implied consent close)
Ask for the sale close
If prospect says no, they may just need more reasons to buy!!
6. Following Up
Must follow up sale, determine if the order was delivered on time, installation OK etc. Also helps determine the prospects future needs. Accomplishes four objectives: customer gain short term satisfaction
referrals are stimulated
in the long run, repurchase
prevent cognitive dissonance
Old school, sell and leave!!–Quickly before customer changes her mind!! Now:
Stay a few minutes after sale–reinforce, make them feel good, made wise choice, leave small gift (with co. name on it!!), call office at any time etc!! Follow up, reinforce, know birthdays, new year etc, friendly correspondence…relationship building!! Handout…Toyota Calling In Japan’s Car Market
Half of cars are sold door-to-door. This is shrinking due to environmental changes. Toyota has more than 100,000 door-to-door sales people. Developing Long-term relationships is key, Keiretsu, do business with only those you know and trust. Face-to-face meetings before business to establish trust, the approach stage. Follow up is key to relationship:
call inquiring on car’s immediate performance
hand written greeting cards
written invitations for low cost oil changes
Driving schools for people to obtain licenses = prospects
Also referrals from existing customers is very important
Curtesy calls to clients who referred new customers.
Timing of presentation:
To housewife in the middle of the day
Just before 3 year “Shaken”, following 2 years
“At first I had no intention of buying a new car, but Mr. Saito is very good at proposing reasons why I should change” = $1,600 shaken. Return to Contents
Management of Salesforce
Sales force is directly responsible for generating sales revenue. Eight general management areas:
Establish Salesforce objectives
Similar to other promotional objectives
Demand oriented or image oriented.
Major objective is persuasion, converting consumer interest into sales. Sales objectives; expected to accomplish within a certain period of time. Give direction and purpose and act as a standard for evaluation. Set for total salesforce and each individual salesperson.
Can be $s, units sold, market share to achieve, for individual salespersons, also include ave. order size, ave. # of sales/time period, and ratio orders/calls. Return to Contents
Organizing the Salesforce
In-house vs. independent agents (manufacturer’s sales agents). Organize by:
Geography (simplest, but not suitable if product(s) are complex or customers require specialized knowledge) Customer: Different buyers have different needs
Product: Specific knowledge re: products is needed
Size. Marginal analysis, or determine how many sales calls/year are needed for an organization to effectively serve its customers and divide this total by the average # of sales calls that a person makes annually. Also use subjective judgement. MBNA estimates how many calls to expect, one year in advance, and then determines the size of the salesforce at any given time.
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Recruiting and Selecting Salespeople
Need to establish a set of required qualifications before beginning to recruit. Prepare a job description that lists specific tasks the salesperson should perform and analyze traits of the successful salespeople within the organization. May use assessment centers–intense training environment that places candidates in realistic problem settings in which they give priorities to their activities, make and act on decisions. Recruitment should be a continual activity aimed at reaching the best applicants. Applicants that most match the demographics of the target market. Changing
demographics, may be wise to hire hispanic sales people if your territory is in Florida!! Return to Contents
Training Sales Personnel
Use formal programs, or Informal on-the-job training. Can be complex or simple. Training should focus on:
Aimed at new hires and experienced personnel.
Can be held in the field, educational institutions or company facilities. Oldsmobile spent $25 million last year to teach its dealers how to better treat its customers. Return to Contents
Compensating Sales People
To attract, motivate and retain sales people, that facilitate and encourage good treatment of the customers. Need to understand personalities of sales people. Strive for proper balance of freedom, income and incentives. Need to determine the best level of compensation required, and the best method of calculating it.
straight commission (selling insurance)–single percentage of sales or sliding rate Combination plan
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Motivating Sales People
Need a systematic approach, must also satisfy non-financial needs: Job security
Opportunities to succeed
Sales contests increase sales.
Symbolic awards–plaques, rings etc.
Can also use negative motivational methods for under performers. Due to burn out–even the best need motivating!!
Ongoing process…keep reps. hungry
Need a motivational program.
Spend time with reps, personal attention!!
Take interest in them and the sales goals
Compensation packet that rewards quality salesmanship and extra effort Recognition of extra effort of sales force
Make sure SR feel important
Keep SR informed of company activities
Make certain reps. believe in the company
Goals must be realistic and achievable and changeable
Determine what they want and give it to them
Controlling and Evaluating Salesforce performance
Rely on information from call reports, customer feedback and invoices. Performance is determined by objectives. May compare with predetermined performance standards or with other sales people working under similar conditions