Transcript 5-5 - McGraw Hill Higher Education

Sales Knowledge: Customers,
Products, Technologies
McGraw-Hill/Irwin
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Chapter
5
5-3
Chapter
5
Main Topics
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5-4
The Tree of Business Life: Knowledge
Sources of Sales Knowledge
Knowledge Builds Relationships
Know Your Customers
Know Your Company
Know Your Product
Chapter
5
Main Topics
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5-5
Know Your Resellers
Advertising Aids Salespeople
Sales Promotion Generates Sales
What’s It Worth? Pricing Your Product
Know Your Competition, Industry, and Economy
Personal Computers and Selling
Chapter
5
Main Topics
 Knowledge of Technology Enhances Sales and
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5-6
Customer Service
Sales: Internet and the World Wide Web
Global Technology Provides Service
Technology Etiquette
Chapter
5
The Tree of Business Life: Knowledge
T
T T
T T TT
T T T T
Builds
Guided by The Golden
Rule:
 Be an expert on everything

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
Relationships
5-7
associated with your product(s).
Use wisdom when applying
knowledge.
Remember, customers rely on you
to truthfully provide knowledge and
wisdom.
Realize that people do not care
how much you know until they
know how much you care.
Sources of Sales Knowledge
 Sales training
 Experience
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Knowledge Builds Relationships
 Knowledge increases a salesperson’s
confidence.
 Knowledge increases a buyer’s confidence in
the salesperson.
 More knowledge leads to more sales and
more relationships.
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Know Your Customers
 Find out all you can.
5-10
Know Your Company
 General company information:
 Company growth and accomplishment
 Policies and procedures
 Production facilities
 Service facilities
5-11
Know Your Product
 Product knowledge may include:
 Performance data
 Physical size and characteristics
 How the product operates
 Specific features, advantages, and benefits of the
product
 How well the product is selling in the marketplace
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Know Your Resellers
 Understand the channel of distribution.
 Know as much about each channel member
as possible.
5-13
Advertising Aids Salespeople
 Main ingredients of a firm’s promotional effort
 Types of Advertising Differ:
 National advertising
 Retail advertising
 Cooperative, or co-op, advertising
 Trade advertising
 Industrial advertising
 Direct-mail advertising
 Internet advertising
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Exhibit 5-2: Advertising and Sales Promotion
Information the Salesperson Provides the Buyer
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Why Spend Money on Advertising?
 Companies advertise because they hope to:
 Increase overall sales and sales of a specific product
 Give salespeople additional selling information for sales
presentations
 Develop leads for salespeople through mail-ins and ad
response
 Increase cooperation from channel members through co-op
advertising and promotional campaigns
 Educate the customer about the company’s product
5-16
Why Spend Money on Advertising?, cont…
 Inform prospects that a product is on the


market and where to buy it.
Reduce cognitive dissonance over the
purchase.
Create sales or pre-sell customers between
sales calls.
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Sales Promotion Generates Sales
 Consumer sales promotion
 Trade sales promotion
 Point-of-purchase (POP) displays
 Shelf positioning
 Shelf facings
 Premiums
 Sales promotion on the Internet
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What’s It Worth? Pricing Your Product
 Price refers to the value or worth of a product
that attracts the buyer to exchange money or
something of value for the product.
5-19
Exhibit 5-4: Examples of Prices and Discounts
Salespeople Discuss in Their Sales Presentations
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Know Your Competition, Industry, and
Economy
 Understand
competitors’
products, policies,
and practices.
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Personal Computers and Selling, Exhibits
5-6 and 5-7
 The top 10 PC applications include:
 Customer/prospect profile
 Lead tracking
 Call reports
 Sales forecasts
 Sales data analysis
 Sales presentation
 Time/territory management
 Order entry
 Travel and expense reports
 Checking inventory/shipping status
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Knowledge of Technology Enhances Sales
and Customer Service
 Personal Productivity:
 Contact management
 Calendar management
 Automate sales plans,
tactics, and tickets
 Geographic information
system
 Computer-based
presentations
5-23
Knowledge of Technology Enhances Sales
and Customer Service, cont…
 Communications with Customers and
Employer:
 Word processing
 E-mail
 Fax capabilities and support
 Customer Order Processing and Service
Support:
 Salespeople's mobile offices
5-24
Exhibit 5-9: 3M’s Salesperson Bob Burr Uses
Mobile Technology to Serve His Customers
GPS Device
Cell Phone
PDA
5-25
Sales: Internet and the World Wide Web
 The Internet
 The World Wide Web:
 Web page
 Links
 Surfing the Internet
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Exhibit 5-10: Web Sites Can Provide
Valuable Information to Salespeople
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Global Technology Provides Service
 Increased worldwide interaction
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Technology Etiquette
 Netiquette – etiquette on the internet
 Cell Phones
 Voice Mail
 Faxes
 Speakerphones and Conference Calls
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Summary of Major Selling Issues
 Company knowledge includes information on
a firm’s:
 History
 Development practices
 Procedures
 Products
 Distribution
 Promotion
 Pricing
5-30
Summary of Major Selling Issues, cont…
 To reduce conflicts and aid channel members in

selling products, manufacturers offer assistance in:
 Advertising
 Sales promotion aids
 Pricing allowances
National, retail, trade, industrial, and direct-mail
advertising create demand for products and are
powerful selling tools in sales presentations.
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Summary of Major Selling Issues, cont…
 Salespeople should be able to confidently
discuss price, discounts, and credit policies
with customers.
 Success in sales requires knowledge of the
many technologies used to sell and service
customers.
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Appendix A: Sales Arithmetic and
Pricing
5-33
Chapter
5
Types of Prices
 List price – standard price
 Net price – after discounts
 Zone price – based on geographical
location
 FOB shipping point – buyer pays
 FOB destination – seller pays
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Discounts Lower the Price
 Quantity discounts:
 Non-cumulative
 Cumulative
 Cash
 Trade
 Consumer
5-35
Exhibit 5A-1: Various Promotional
Allowances Available to Resellers
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Exhibit 5A-2: Types and Examples of
Discounts
Skip video
5-37
To pause the video, click on the video screen. To resume
play, click on the video screen again. Click outside the
video screen twice to advance to the next slide.
Resellers: Markup and Profit
 Markup
 Gross profit
 Net profit
 Channel of distribution markup
 Markup arithmetic
 Return on investment
5-39
What Is Markup?
 Markup is the dollar amount added to the
product cost to determine its selling price.
 Markup is often expressed as a: percentage
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What Is the Percent Markup?
$1.00 = cost to retailer
$1.00 = dollar markup
$2.00 = selling price
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What Is the Percent Markup?, cont…
 It depends on whether you use:
 Selling Price, or
 Cost
 Dollar markup is divided by either selling price
or cost to retailer.
 Selling price = 50%
 Cost = 100%
 We use selling price in calculating the percent
of markup.
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Exhibit 5A-3: Example of Markup on Selling
Price in Channel of Distribution
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Exhibit 5A-4: Example of Using Unit
Cost
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Exhibit 5A-5: Profit Forecaster for Granola
Bars Shown to Buyer
Total stores
Deal dates
Regular cost per dozen
Less allowance ($.53)
Deal cost per dozen
Feature price
Cases purchased
Total investment
Total gross sales
Total gross profit
Return on investment (ROI)
a
5 cases per store
b
500 x 15.24 = $7,620
c
500 x 12 = 6,000; 6000x $1.39 = $8,340
Skip video
5-45
3-Day Special
2-Week Special
Normal
100
June 1 – June 30
$21.60
- 6.36
$15.24
1.39
500a
$7,620b
$8,340c
$720d
9.0%e
100
100
$21.60
- 6.36
$15.24
1.39
1,000
$15,240
$22,680
$7,440
49%
$21.60
d
$8,340 - $7,620 = $720
$720 ÷ $7,620 = 9.0%
f
$21.60 ÷ 12 @ case = $1.80 (regular cost)
g
$7,020 ÷ $32,400 = 22%
e
$21.60
2.19f
1,500
$32,400
$39,420
$7,020
22%g
To pause the video, click on the video screen. To resume
play, click on the video screen again. Click outside the
video screen twice to advance to the next slide.
Organizations: Value and ROI
 Value analysis
 Product cost
compared to true
value
 Unit costs
 Return on
investment (ROI)
is listened to
5-47
End of Chapter 5
McGraw-Hill/Irwin
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Chapter
5