Transcript MBA 860 - Adv. Mkt. Strategy

Chapter 9
Professional Selling
Chapter Outline
• How Professional Business Selling Differs from Personal Selling to
Consumers
• Profile of a Professional Salesperson
• The Cost of Professional Selling
• Understanding Buyer Behavior: A Seller's Perspective
• The Importance of Planning
• Sales Presentation Approaches
• Selling Styles and Sales Tasks in the Business Market
• The Professional Selling Process
• Contemporary Trends in Business Selling
Characteristics of Top
Business Sales Performers
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Goal-Setting
Vision
Passion
Communication Skills
Commitment
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Efficiency
Readiness to Learn
Helping People
Integrity
A salesperson for XYZ Corp. discovers a new potential customer. A sales
call confirms that the company purchases millions of dollars of products
from XYZ’s competitor. The buyer makes it clear that they are very
satisfied with their current sources and have no need for XYZ Corp.
The salesperson’s report suggests little chance to become a supplier, but
the salesperson will check in with the company every six months in case
anything changes.
What time is it? It’s time for a new salesperson.
The Personal Selling Process:
A Business Salesperson’s Perspective
• Preliminary Activities
• Face-to-Face Activities
• Follow-Up Activities
Professional Buyers
Barriers to overcome:
• I don’t know who you are.
• I don’t know your company.
• I don’t know your company’s product.
• I don’t know what your company stands for.
• I don’t know your company’s customers.
• I don’t know your company’s record.
• I don’t know your company’s reputation.
NOW, What was it you wanted to sell me?
Methods Used to Uncover
Important Buyer Needs
• Ask questions: Questions often can bring out needs that the
prospect would not reveal or does not know exist.
• Observe: Successful salespeople are particularly sensitive to
customer expressions and body language.
• Listen: Salespeople must remember that telling is not selling. The
instant a salesperson asks a question and waits quietly for an
answer, the prospect’s entire attention is focused on the
salesperson. Thus, a basic rule of selling is, never to say something
if you can ask it.
Planning a Sales Call
• Planning is valuable to focus thinking and prepare the salesperson
for what is expected.
• Typical planning process involves:
– Setting objective
– Preparing an opener
– Preparing qualifying questions
– Listing main features and advantages of product/service
– Listing main benefits of product/service
– Listing support to substantiate benefits
– Listing expected buyer’s objections and salesperson’s
responses
– Planning the close
Salespeople Expect—
and Even Like—Objections
• Handling objections correctly will lead to your close.
• Well-handled objection is a positive buying signal.
– Ask for the order
– Ask for the trial
– Ask for action
Handling Sincere Objections
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Find out what the objection means—ask questions and listen. What
does “it costs too much” really mean?
Restate objection as you understand it.
Get in step—agree that it is a wise concern. Never say, “You’re
wrong.”
Answer objection by
– Offsetting with other benefits
– “Boomerang method”—converting objections into a benefit
– Converting objection into question so it becomes a request for
further information
Closing the Sale
• Closing is simply asking for the order. A professional salesperson
knows several closing techniques from which to choose, based on
prospect and setting.
• When to close:
– After a positive buying signal
– After a successful answer to an objection
– At the end of the presentation
• Types of closings:
– Direct: Can we write up the order?
– Alternative proposal: Do you prefer truck or rail shipment?
– Assumptive: We can ship tomorrow if you’ll sign here.
– Minor decision: Takes customer through decision-making
process— either/or, step by step, open-ended questions,
summary, balance sheet
Do You Have These
Salesperson Characteristics?
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Is detail oriented
Likes to meet new people
Manages multiple things
Appearance oriented
Good listener
Gets involved
Encourages harmony,
agreement
• Has good communication
skills
• Has good intuition
• Enjoys discussing events and
news
• Keeps in touch
• Has sense of responsibility
• Has organizational skills
Chapter 10
Business Sales Management
Chapter Outline
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Sales Management: A Leadership Challenge
Differences Between Sales Managers and Salespeople
Basic Types of Sales Organizations
Staffing a Sales Force
Recruiting and Selecting a Sales Force
Training and Developing a Sales Force
Directing and Motivating a Sales Force
Analyzing and Evaluating a Sales Force
Business Sales Management:
A Leadership Challenge
• The first qualification for a sales manager is leadership.
• Leading, managing, facilitating, and inspiring activities of
salespeople is important because salespersons work at the
boundaries of organizations where oversight and supervision are
difficult.
• Organizations are constantly faced with the challenge of finding
ways to improve sales force performance.
Leadership
• Leadership is difficult to define and teach, but we know it when we
see it.
• A leader brings out the best in us and knows that we can be
successful even before we do.
A Leader…
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Creates shared vision and purpose.
Empowers through confidence and trust.
Is a role model.
Facilitates, encourages, and supports.
Serves the needs of the team.
Creates a team of leaders.
Managerial Leadership*
Research shows that even when managing a group of individual contributors,
effective leaders:
– Create self-confidence in individuals by clear and sincere supporting
messages. Self-confidence leads to more innovation, empowerment, and
success.
– Use communication and interactions to increase individuals’ feelings of
being part of a greater whole, working together toward a worthy vision.
– Are perceived as honest, caring, trusting, respecting, and consistent.
– Encourage and literally support the highest levels of achievement
(results that individuals can take pride in).
– Build group culture that all are glad to be a part of.
– Provide constructive feedback and encourage individual professional
growth to help each person be all that he/she can be.
* Based on Gomes-Knowles Model (JME, vol. 21, no. 3 [1999], 164-174.)
Selecting the Sales Manager
• Selling skills and leadership/management skills are different. Not all
good salespeople make good managers, yet firms still tend to
promote this way.
• To be a successful manager, it is important to adopt different:
– Perspectives: Must consider whole sales team and organization
rather than just self as salesperson.
– Goals: Must be concerned with organization’s, not individual’s,
goals.
– Responsibilities: Must recognize necessity of making a sale at
profit and monitoring customer satisfaction with both products
and salesperson service.
(continued)
Selecting the Sales Manager
– Satisfaction: From seeing salespeople succeed, not from
making the sale.
– Job skill requirements: Must have product and selling
knowledge, but also leadership skills—communicating,
delegating, planning, managing time, motivating, and training.
– Relationships: Must be developed with sales force and internal
area managers, as well as customers.
• Those who aspire to be sales managers should make it apparent
that they have these qualities.
Basic Types
of Sales Organizations
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Line
Line and staff
Functional
Centralized vs. decentralized
By specialization
– Geographic
– Sales activities
– Product specialization
– Customer specialization
– Combination
Determining Sales Force Size
• Workload method:
– Frequency of sales calls to given customers
– Time intervals between sales calls
– Travel time around the territory
– Nonselling time
• Sales potential method: Yearly sales volume divided by expected
volume of each salesperson
• Incremental method: Profit contributions from an additional
salesperson’s sales versus costs of hiring that person
Staffing the
Business Sales Force
• Conduct a job analysis.
• Prepare a written job description.
• Develop sales job qualifications (specifications).
Training and Developing
the Business Sales Force
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Company knowledge
Product knowledge
Selling techniques
Customer knowledge
Competitive knowledge
Time and territory management
Sales Training Evaluation
• Set objectives (overall and specific) for company sales training
program.
• Determine whether objectives as set are being met or already have
been met.
• Try to measure the effect of training on profitability.
Directing and Motivating
the Business Sales Force
• Providing leadership
• Sales quotas:
– To provide incentive
– To provide a basis for compensation
– To evaluate a person’s performance
• Compensation
Analyzing and Evaluating
a Sales Force
• To determine areas where each salesperson needs improvement
• To assess the validity of the standards used
• To spot people who are ready for promotion, salary raises, or
assignment to new territories and responsibilities
• To supply evidence about salespeople who should be disciplined or
terminated
• To check the effectiveness of the sales compensation plan, training,
supervision, recruitment, territory assignments, and operating
procedures
(continued)
Analyzing and Evaluating
a Sales Force
• Whether sales force is organized around team selling or individual
contributors, managing salespeople is somewhat different than
managing groups in internal parts of organization.
• An entry-level professional in operations, personnel, or accounting
may be motivated by the goal of some day progressively advancing
through the ranks, but many in sales would not find that attractive;
they get great satisfaction (and remuneration) just remaining a
territory salesperson.
• Commission is a powerful incentive, and managers must be sure
compensation plan is consistent with objectives. If there are
problems with sales results, be sure you understand sales force
reward system.
Chapter 11
Advertising and
Sales Promotion Strategy
Chapter Outline
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The Role of Promotion in Business Marketing
Setting Objectives for a Promotional Plan
Developing the Promotional Budget
Developing and Implementing the Promotional Mix
Measuring the Effectiveness of the Business Promotion Campaign
Following Up and Making Necessary Changes
Marketing Mix = Product, Price, Promotion, Place
Advertising, publicity, and sales promotion are communication
methods used by marketers to remind, inform, interest, or
persuade existing and potential customers In the business
market, advertising, publicity, and sales promotion pave the way
for the sales call (Personal Selling, Chapter 9).
Promotion Mix = Advertising, Publicity, Sales
Promotion, Personal Selling
Business-to-Business Promotion
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Marketing professionals are responsible for strategically setting
marketing mix (4Ps), and that includes details of each element.
In the case of promotion “P,” that responsibility includes setting details
of promotion mix.
As presented in Chapter 9 (Selling), business-to-business promotion
relies heavily on personal selling. Why is that?
The majority of our efforts and resources for business-to-business
promotion typically go to personal sales. Some of the reasons include:
– Need to develop personal relationship and trust.
– Complexity of product or service.
– Need for early supplier involvement in development stage.
– Great importance of customer satisfaction.
– Continuous need for customer-need monitoring and
communication.
(continued)
Business-to-Business Promotion
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But business marketers do utilize other promotion mix elements, often
to support personal selling.
Advertising, publicity, and sales promotion support personal selling
by:
– Creating awareness
– Generating leads
– Reinforcing company image
– Creating interest
– Reaching buying center influencers previously unidentified or
inaccessible to salesperson
It is probably fair to say that most business-to-business marketers are
more expert with personal selling element of promotion mix than with
its advertising, publicity, and sales promotion elements.
That makes this chapter all the more important!
Steps in Creating
a Promotional Plan
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Setting objectives
Developing promotional budget
Developing and implementing promotional mix
Measuring effectiveness of promotional program
Following up and modifying promotional campaign, if necessary
Effective promotion helps sales; ineffective promotion can waste
money and even damage company image.
Common Budget-Setting
Techniques
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Percentage of anticipated sales
Affordable/Arbitrary (most common)
Competitive parity/Market share
Objective-and-task (most common)
Winning Sales through
Cooperative Promotion
At Montana State University, Pepsi is out and Coke is in. In a competitive
bid, Coca-Cola has won the five-year contract to be the exclusive soft drink
supplier for the entire MSU campus. To win the contract, Coke offered the
school a combination of cash payments and value through cooperative
promotion.
These promotions included:
– $250,000/year payments plus a commission on sales
– Cooperative marketing program including radio advertising
– New soccer field scoreboard and ice machine
– Coke cans across the region to carry MSU logo
– Off-campus vending machines with MSU logo, plus commission on
those sales
(From Marketing News, November 8, 1999, p. 9.)
Advertising
• A good ad often is similar to a sales call—
– Opener (headline) to catch interest
– Body to convey information and benefits
– Call for action to close
• Ad’s connection to customer’s buying and adoption process
should be clear.
• A good ad:
– Is memorable
– Is consistent with company’s image
– Interests the right target audience
– Is easy to read
– Provides evidence of customer value
– Motivates reader to want to learn more
– Provides easy way for reader to learn more
Print Media
Publication Type
Examples
Horizontal
Design Engineering,
Purchasing
Vertical
Chemical Industry News,
Mechanical Contractor
Professional
Architectural Digest,
Dental Technology
Industrial
Thomas Register of
American Manufacturers
General Business
Fortune, Business Week
Broadcast Media
• Radio and TV are sometimes used where market is highly
geographically concentrated and product is of interest to broad
range of business users.
– A roller bearing company in Ohio may use radio ads during
morning commute in highly industrialized city to reach buying
center influencers in local industries where roller bearings are
used.
– IBM, Hewlett-Packard, Xerox, or FedEx may use TV spot during
“Dilbert,” which is watched by professionals from a wide range
of industries, i.e., potential customers.
• Broadcast media would not be likely vehicle if products were only
used by a few companies in target area (which is often the case).
Direct Marketing
• Business-to-business direct marketing is big business—
approximately $1 trillion/year.
• Types
– Direct mail
– Telemarketing
– E-mail/Internet
Advertising Agencies
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Advertising agencies work on advertising strategy and campaigns,
prepare copy and layouts, study markets, select media, and carry out
actual physical production of advertisement and its placement in
selected media.
Agencies do not always understand technology and particular buying
process in business markets. Even when using advertising
professionals, marketer must assure ad strategy and content is
appropriate and effective. How can you do that?
When using an agency, marketer is responsible for:
– Creating and measuring ad and campaign objectives.
– Understanding target market’s adoption process.
– Understanding how ad campaign fits into integrated promotion mix
that moves potential buyer through each step in adoption process
and supports continued customer satisfaction and repurchase.
– Testing ads.
(continued)
Advertising Agencies
• Many business marketers don’t formally test advertising
effectiveness (as strange as that may seem!).
• Agencies are paid for their ad production costs, plus a percentage
(~15%) of every media placement. If a marketer relies on the agency
to recommend placements, there may be a conflict of interest.
• Some marketers are asking agencies to accept payment based on
ad and campaign performance (pre- and posttesting). Agencies are
resisting.
Business Publicity
• Publicity can:
– Help build or add to company’s visibility or image.
– Introduce a new product, service, or improvement.
– Provide salespeople with easier entry into office of current or
prospective customers.
• Good publicity doesn’t just happen; it is managed. PR department
will create relationships with appropriate media representatives and
provide them with newsworthy information presented from the
company’s perspective. If all goes well, that is how it will appear.
• Because media are not paid to present publicity, there is little
control over how it is presented. Marketers tend to have more
influence with media outlets they regularly use to advertise.
(continued)
Business Publicity
• Techniques for getting in the news:
– Press releases
– Exclusive features
– Press conferences
– Press kits
• Getting free publicity is nice, but it leaves you at mercy of poor
placements, poor wording, or intentional negative spin. Use it with
caution.
(continued)
Business Publicity
In a recent example of the lack of control over publicity, a university
put out a news release concerning the student government’s new
honor code. Acting on their own, the students created a set of honor
standards and administration plan that are among the most rigorous in
the nation. As a final step in the process, the faculty voted their
support of the code.
The news item was picked up by the region’s leading paper which ran
the story under the bold headline:
University Faculty Approves Cheating Plan
At best, the headline is poorly worded.
(continued)
Business Publicity
Roger E. Axtell, a past Vice President of Marketing for the Parker Pen
Company tells of one his first assignments with the company. He sent
out a news release announcing a new company president and
management team. The newspaper ran the item with the new
management team’s pictures by the side of the article. Unfortunately,
directly under the pictures the newspaper had placed an unrelated
article with the headline:
Local Men Arrested in Pig Theft
Free publicity leaves you at the mercy of poor placements, poor
wording, and even intentional negative spin. Use it with caution.
Trade Shows and Exhibits
• Trade shows are often large component of total business marketing
promotion budget allocation (behind personal selling and, possibly,
trade journal advertising).
• Trade shows (large and small, industry-specific and general) are
regularly scheduled in cities all across the world.
• COMDEX, the U.S. computer industry trade show, brings together
2,200+ companies and 220,000 attendees.
(continued)
Trade Shows and Exhibits
• Like all marketing expenditures, trade shows need to have measurable
objectives and a budget.
• Using your business judgment, estimate the costs for a company in
your area to exhibit at the annual “Manufacturing Week” trade show in
Chicago. Expenses include:
– Space rental
– Air travel for four
– Hotel
– VCR
– Display booth
– Meals
– Shipping (2-way)
– Entertainment
– Set-up/dismantle
– Catalogs to pass out to attendees
(union rate)
– Chairs, tables, carpet rental
(continued)
Trade Shows and Exhibits
Sales Promotion
• Advertising specialty items:
– Calendars
– Desk clocks
– Pens
– Calculator notepads
– Posters
– Desktop business card holders
– Tape measures
– Travel alarm clocks
– Mugs
• If company name is on item that is handy to buying center
influencers, is it effective as goodwill or as a reminder?