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Marketing Dynamics Marketing

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1 Marketing Dynamics Marketing
Preparing for the Sale Describe your best and worst sales experience. Copyright © Texas Education Agency, All rights reserved

2 Copyright Agency and will be required to enter into a license agreement that may involve the payment Copyright © Texas Education Agency. The materials found on this website are copyrighted © and trademarked ™ as the property of the Texas Education Agency and may not be reproduced without the express written permission of the Texas Education Agency, except under the following conditions: Texas public school districts, charter schools, and Education Service Centers may reproduce and use copies of the Materials and Related Materials for the districts’ and schools’ educational use without obtaining permission from the Texas Education Agency; Residents of the state of Texas may reproduce and use copies of the Materials and Related Materials for individual personal use only without obtaining written permission of the Texas Education Agency; Any portion reproduced must be reproduced in its entirety and remain unedited, unaltered and unchanged in any way; No monetary charge can be made for the reproduced materials or any document containing them; however, a reasonable charge to cover only the cost of reproduction and distribution may be charged. Private entities or persons located in Texas that are not Texas public school districts or Texas charter schools or any entity, whether public or private, educational or non-educational, located outside the state of Texas MUST obtain written approval from the Texas Education t of a licensing fee or a royalty fee. Copyright © Texas Education Agency, All rights reserved

3 Goals The student can differentiate among a feature, an advantage, and a benefit. The student can compare and contrast between consumer, organizational buying behavior The student can determine customer needs and wants The student can classifying buying motives The student can analyze how customers and organizations apply the decision-making process. The student can identify major influences on buying behavior The student can acquire information about customer needs Copyright © Texas Education Agency, All rights reserved

4 Terms Personal Selling Business-to-Business Product feature
Customer benefit Feature-benefit selling Rational motive Emotional motive Extensive decision making Limited decision making Routine decision making Copyright © Texas Education Agency, All rights reserved

5 Types of Sales Personal Selling involves any form of direct contact between a salesperson and a customer. Personal Selling can be involved in different type of sales situations. Business-to-business selling Also called B2B Manufacturer or wholesaler selling to another business. There are basically two types of selling situations. The first is the one that most of us are probably more familiar with, that is the retail selling to end customers like us. This can take place in a mall, via the television or on the phone, or even through the internet. If however there is a sales person present and we are dealing with them in a direct one-on-one situation then this is referred to as “personal selling’”. Personal selling allows the sales person to modify their approach based on the customers questions, and body language. Business-to-business or B2B selling is when businesses sell to other businesses. This type of industrial selling is a major aspect of selling. Instead of selling one shirt at a time at the mall to an end customer, a salesperson may sell 10,000 shirts to a major retailers so they can then sell to the end customer. All sorts of products are sold B2B from wholesale products to be resold in retail environments to pallets of paper for the companies internal use. Copyright © Texas Education Agency, All rights reserved

6 Feature Benefit Selling
Feature Benefit Selling – a good salesperson can translate the products features into how they will benefit the customer. Product Features Basic, physical or extended attributes of the product. Example: Digital Image Stabilization (D.I.S.) Customer Benefits How that feature helps the product How does the feature give a customer a reason to buy. Example: D.I.S. helps to reduce the camera shaking so you can take a better picture from further away. Feature benefit selling is a critical aspect of sales. You may have the best product in the world, but if you cannot translate the features of your product from a technical aspect to how those features will benefit the customer the customer may never decide to purchase your product. The more technical the product the more important it is to translate it into benefits. Not all customers are technical and may not realize the benefits that product will do for them. Copyright © Texas Education Agency, All rights reserved

7 Customer Buying Motives
Rational motive – a conscious, logical reason to make a purchase. Dependable product Cost savings Better health Safety considerations Quality of product Different reasons motivate customers to purchase products. It is the job of the sales person to determine what motivates their customer and to sell the product to that motive. One motive is rational motive. The customer has a logical, conscious reason to purchase the product. It is a better value, it will save them money, it can improve their health or the product is of a superior quality. The sales person can emphasis these attributes in order to sell the product. Copyright © Texas Education Agency, All rights reserved

8 Customer Buying Motives
Emotional motives that involve feelings that a customer has that are associated with the product. Social approval Recognition Power Love prestige An emotional buying motive might more difficult to determine, it involves the feelings that customer has for the product or the company. This can be a positive or a negative. If the customer has had a positive experience with the product or company they are more likely to purchase the product, however if they have had a negative experience they will be reluctant about purchasing the product. Other things that involve emotional buying include products that make the customer feel that they will have more approval from their peers, or more prestige. Think about luxury car commercials, they want to show how your neighbors will envy you if you drive home in one of their cars. These type of products appeal to the customers feelings. Copyright © Texas Education Agency, All rights reserved

9 Customer Decision Making
Factors that affect decision making Previous experience with a product or company How often the product is purchased The amount of information necessary to make a decision. The importance of the decision to the consumer. The perceived risk involved in the purchase The time allotted to make the decision. When customers are making decisions there are some factors that affect the process. If a customer has purchased the product many times over and is very familiar with it they won’t requires as much research and forethought as if they are purchasing a product that they have never seen before. The decision process also involves the risk that the customer thinks they are taking and the expense of the product. Copyright © Texas Education Agency, All rights reserved

10 Customer Decision Making
Extensive Decision Making Little or no prior experience with the product. High degree of perceived risk or Very expensive product Examples are (B2B) Expensive machinery (B2B) Land or buildings First cars First homes Extensive decision making takes longer than either of the other two. This involves purchases that the customer has never made before and that has high amount of perceived risk or expense. This could be the first home for a new home buyer, or a first car. Most people will spend days, weeks or even months researching these products until they feel that they have enough information to make a decision. Sales people can help a customer make a decision by providing information and reinforcing the customers decisions. Copyright © Texas Education Agency, All rights reserved

11 Customer Decision Making
Limited Decision Making Person has already purchased product before but not regularly Moderate degree of perceived risk Customer requires information before making purchase. Examples (B2B) Accounting services (B2B) Advertising agency services Second car Appliances Vacations Limited decision making involves products that the customers has either purchased before or lower amount of risk or expense. If a home buyer is shopping for their second home or second car they already have prior knowledge and just need to update their information bank so to speak instead of starting from scratch. It is a shorter decision cycle because the customer is more familiar with the product or the company and has greater confidence in their decision making capabilities. Copyright © Texas Education Agency, All rights reserved

12 Customer Decision Making
Routine Decision Making Customer needs little information about product High degree of prior experience with product Low risk Examples: (B2B) reorder goods (B2B) office supplies Groceries Dry-cleaning Hairdressing services Routine decision takes very little time or thought on the customers part. These are for products that have been purchased many times or have a low degree of risk or expense. Groceries are a good example. Most people don’t spend hours of research when deciding on which toothpaste to buy. If they are changing brands, they may spend a few minutes in the toothpaste aisle reading boxes but then make a choice and move on. This type of decision making process does not usually involve a sales person convincing the person to make the purchase like the extensive or limited decision making process does. Copyright © Texas Education Agency, All rights reserved

13 What makes a good salesperson?
Good communication skills Good interpersonal skills Solid technical skills Positive attitude and self-confidence Goal oriented Empathy Honesty Enthusiasm Good sales people have certain traits in common. They need to be positive, enthusiastic, goal oriented people. It is hard to sell a product to someone if you are afraid to talk to them or cannot communicate well. People who have good technical skills also can make good salespeople since they can truly understand the features and benefits of the products and relate them to the customer. Being able to empathize with the customer can help them to see from the customers standpoint and understand their objections. Understanding the customers objectives is the first step to being able to overcome their objections and make the sale. Copyright © Texas Education Agency, All rights reserved

14 Determining Needs Determine needs as soon as possible. Ask questions
Don’t assume The first thing that a sales person needs to do is determine what the customer needs. It is waste of sales person and a customers time if they do not first figure out what the needs are so they can begin to find product that meets those needs. Suppose a customer comes into a camera store and asks to see a particular camera. The sales person spends 45 minutes selling the customer on the camera until the customer mentions that he needs a camera with at least 10x zoom, which this camera does not have. The customer has just wasted valuable time. If a sales person is on commission this could mean the loss of salary also. So it is important that the sales person determine the customers needs as soon as possible. They should ask questions and not assume that they know what the customer wants and needs. Copyright © Texas Education Agency, All rights reserved

15 Determining Needs Observing – observe customer to look for buying motives Look for nonverbal clues. Study facial expressions, hand motions, eye movement etc. to determine customers interest or mood. How long they hold the product. In B2B sales look for clues in office for personal interests. In retail sales walk through store and observe customers, items carried and prices. There are several different was that a sales person can determine the customers needs. They can first observe the customer and look for their buying motives. These can be nonverbal clues, like a person smiling while looking at a particular model of car. If they pickup an item and spend time studying it, or keep coming back to the same item and picking it up. In B2B sales the sales person usually visits the customer in his office. They can look for clues in their office of what their interests are and begin conversations based on those interests. In retails sales they can observe customers. For instance if a customer is carrying a dress over her arm through the store they are probably interested and the sales person can offer to open a dressing room so the customer can try on the outfit and then suggest a purse, shoes or jewelry that compliment the dress. Copyright © Texas Education Agency, All rights reserved

16 Determining Needs Listening – helps you pick up clues to customers needs and for use in product presentation. listening skills Maintain good eye contact Provide verbal and nonverbal feedback Give customers your undivided attention Do not interrupt Listening sounds like it would be easy to do, but this can very challenging for most of us. We don’t listen to what people are telling us, we are thinking of our responses while the other person is talking, or we cut off the person thinking we know what they are going to say. For sales people these can be fatal mistakes to being able to close the sale. It is important to not interrupt the customer, make eye contact and give them your undivided attention. You can also provide verbal and non-verbal feedback, like nodding that you understand. Copyright © Texas Education Agency, All rights reserved

17 Determining Needs Questioning – in order to listen you must get them talking. Begin with general questions about intended use or product and pervious experience with product. Build your questions around words like who, what, when, where, how and why. Then begin asking more detailed questions, like size, color or features. Some customers may not be as prone to start talking about what they want or they may not know exactly what they want. So it is important that sales people know how to ask questions to get information out of the customer. At first they can being with general questions, like “are you interested in buying a car or a truck?” and then work to more detailed questions. Follow up questions could be about the color or style or features that they want. Don’t’ be afraid to ask how money that want to spend also. Once again, you don’t want to spend hours selling a product to the customer who just loves the product but then you both find out that they can’t afford it. It will be hard to move that customer to a lower cost item without them feeling disappointed and that will affect your sale. Copyright © Texas Education Agency, All rights reserved

18 Determining Needs Do’s and Don'ts for asking questions:
Do ask open-ended questions to encourage talking. Do ask qualifying questions to make sure you understand customer needs. Don’t ask too many questions in a row. Don’t ask questions that might embarrass customer or put them on defensive. Be sure when asking questions that you don’t make the customer feel like they are being interrogated. For instance don’t ask too many questions in a row, especially in a rapid fire fashion. Also don’t ask embarrassing questions to the customer like how much they weight or their age or even their size if you think they might get defensive about it. Do ask open-ended questions to get the customer talking and be sure and qualify them so that you know exactly what the customer is looking for so you are not wasting either of yours time. Copyright © Texas Education Agency, All rights reserved

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