Preparing for the Sale

2 What You'll Learn  The definition and goals of selling  The various sales situations encountered in the business world  The definition of feature-benefit selling  How customers make decisions and the difference between rational and emotional buying decisions Selling

Why It's Important Learning how to research products and customers is helpful when selling any type of product or idea. Learning how to find customers is also essential. In this chapter you will be exposed to key selling concepts that link products to customers.

Selling Personal selling is direct contact between a salesperson and a customer. Business-to-business selling may take place in a manufacturer's or wholesaler's showroom (inside sales) or a customer's place of business (outside sales). Telemarketing is the process of selling over the telephone. Knowing Your Product and Your Customer

Selling Knowing Your Product and Your Customer The goal of selling is to help customers make satisfying buying decisions. Salespeople accomplish this by solving customers’ problems and by understanding their needs and wants.

Selling Consultative Selling Providing solutions to customers’ problems by finding solutions to customers’ problems by finding products that meet their needs. Example: Customer on feet all day = shoes designed for comfort and support.

Selling Feature-Benefit Selling Matching the characteristics of a product to a customer's needs and wants is called feature-benefit selling.  Example: A computer is purchased to increase productivity.

8 What You'll Learn  Sources for developing product information  Prospecting sources and methods  How leads are developed  Preparation for the sale in business-to-business selling and retail selling Preparing for the Sale

Selling Product Features Product features are the basic, physical, or extended attributes of the product:  Basic features are a product’s intended use.  Physical qualities differentiate it from competing brands and models.  Additional features add value and justify price differences between models.

10 Selling Customer benefits are the advantages or personal satisfaction a customer will get from a good or service. To determine customer benefits, salespeople need to answer two questions about each product feature: 1. How does the feature help the product’s performance? 2. How does the performance information give the customer a personal reason to buy the product? Customer Benefits

Selling A feature-benefit chart combines a product or extended feature with its corresponding customer benefit to create selling points. One without the other is not sufficient. Feature- benefit charts help customers make buying decisions. Feature-Benefit Chart

Selling Salespeople must know what motivates customers to buy and what decisions customers make before the final purchase. Customers' motives fall into the following categories:  rational  emotional Customer Buying Motives

Selling A rational motive is a conscious, logical reason for a purchase, such as dependability or time savings. An emotional motive is a feeling experienced by a customer through association with a product, such as social approval, recognition, power, or prestige. Customer Buying Motives

Selling There are three distinct types of decision making:  extensive  limited  routine Decisions are based on a person’s previous buying experience and the importance and perceived risk of the purchase. Customer Decision Making

Selling Extensive decision making is used when there has been little or no previous experience with an item.  Extensive decision making is used when there is a high degree of perceived risk.  It is usually used for goods and services that are very expensive or have high value to the customer. Extensive Decision Making

Selling Limited decision making is used when a person buys goods and services that he or she has purchased before but not regularly. Limited Decision Making  In limited decision making, there is a moderate degree of perceived risk.  When making this type of decision, the customer often needs some information before buying.

Selling Routine decision making is used when a person needs little information about a product. Routine Decision Making  In routine decision making, there is a high degree of prior experience.  It is usually used for goods and services that have a low perceived risk (because an item is inexpensive, is bought frequently, or satisfaction with the product is high).

19 Graphic Organizer Types of Customer Decision-Making Processes CUSTOMER Expensive or Highly Valued Item No Experience with Item Information Needed Some Experience with Item High Product Satisfaction Much Prior Experience with Item High Perceived Risk Moderate Perceived Risk Low Perceived Risk Extensive Decision Making Limited Decision Making Routine Decision Making

A SSESSMENT Reviewing Key Terms and Concepts 1.What sets personal selling apart from other forms of promotion? In personal selling, there is two-way communication between the buyer and the seller. 2. Identify a basic, a physical, and an extended product feature for a camera. Basic feature: it takes photos. Physical feature: red-eye reduction. Extended feature: warranty.

A SSESSMENT Reviewing Key Terms and Concepts 3.What factors influence the level of customer decision making? Factors that influence the level of customer decision making might include: experience with the product and company, how often the item is purchased, amount of information necessary to make a wise buying decision, importance of purchase to the customer, and perceived risk involved in the purchase.

A SSESSMENT Thinking Critically Think of a purchase you or your family recently made that required at least limited decision making. Use that product to explain the meaning of this statement: Customers do not buy products, rather they buy what the products will do for them.

Preparing for the Sale The preapproach is getting ready for the face-to-face encounter in a selling situation. Salespeople do the following to prepare for  Study their products.  Keep abreast of industry trends.  Research potential customers.  Develop familiarity with their company's policies and procedures.

Preparing for the Sale Product Information Product knowledge is essential for success in selling. The following are some of the ways salespeople find product information:  Direct experience—using the product  Written publications—manuals, warranties, catalogs  Other people—previous users, supervisors, manufacturer's representatives  Formal training

Preparing for the Sale Industry Trends Sales representatives read periodicals related to their trade to gain insight into the industry. All industries have trade publications related to their industry.

Preparing for the Sale Sources and Methods of Prospecting A prospect, or a lead, is a potential customer. There are seven main methods for developing prospects:  employer leads  telephone directories  trade and professional directories  newspapers  commercial lists  customer referrals  cold canvassing

Preparing for the Sale Employer Leads Most businesses try to generate prospects but also rely on salespeople to find new customers. Telephone Directories The White Pages is a list of names and phone numbers of potential customers. The Yellow Pages can be useful for B2B prospecting. Sources and Methods of Prospecting

Preparing for the Sale Trade and Professional Directories These can help B2B salespeople locate customers by industry. Newspapers Birth announcements provide leads for insurance salesmen. Notices of mergers and new businesses provide leads for B2B salespeople. Commercial Lists Some companies specialize in providing lists of potential customers categorized by education, income, etc. Sources and Methods of Prospecting

Preparing for the Sale Customer Referrals Satisfied customers refer their friends and relatives. This is called the endless chain method. Cold Canvassing Potential customers are selected at random, such as by going door-to-door or through the phone book. This is also sometimes called blind prospecting. Sources and Methods of Prospecting

Preparing for the Sale If the sales call is with an existing customer, the salesperson analyzes past sales records and reviews notes about the customer's personality, family, and interests. Preparing for the Sale in Business-to-Business Selling

Preparing for the Sale If the sales call is with a new customer, the salesperson must research answers to the following questions, usually through a phone call to the customer:  Does the prospect need this product or service?  Does the prospect have the financial resources to pay?  Does the prospect have the authority to buy? Preparing for the Sale in Business-to-Business Selling

Preparing for the Sale Since the customer comes to you, retail preparation includes:  Straightening, rearranging, and replenishing the stock.  Adjusting price tickets before and after special sales.  Learning where stock is located and how much is available. Preparing for the Sale in Retail Selling

33 Preparing for the Sale  Taking inventory.  Arranging displays.  Vacuuming the floor, dusting the shelves, and keeping the selling area neat and clean. These activities keep you familiar with the merchandise and makes it easier to find things for customers. Preparing for the Sale in Retail Selling

A SSESSMENT Reviewing Key Terms and Concepts 1.In all selling situations, what can salespeople do to prepare for the sale? In all selling situations, salespeople can prepare for the sale by studying their products, keeping abreast of industry trends and competitors, researching potential customers, and developing familiarity with their company’s policies and procedures.

A SSESSMENT Reviewing Key Terms and Concepts 2. What is prospecting? Prospecting is looking for potential customers.

A SSESSMENT Thinking Critically You have been asked to research a new prospect for your boss. Your research of this lead found that the company's owner is a 90-year old sole proprietor. The company is financially sound and pays its bills on time. The only concern is that there is no heir- apparent (someone to take over if the owner is no longer capable of running the business). Would you qualify this prospect as a worthy customer? Why or why not?