Preparation & Process

Today we go through:

The Psychology in

Selling Buying Decision Process Buying Situations or Types of Purchases Effective Communication Sales Knowledge and Sales Related Marketing Policies The Sales Process Transactional and Relationship


the prospective buyer will respond in a predictable manner Model does not tell us why the prospect buys or does not buy the product that the salesperson is trying to sell Understanding the psychological aspects in buyer behavior .Buyer Behavior Model Model assumes that if a salesperson applies a stimulus (or sales presentation).

BUYING DECISION PROCESS Five Stage Model of the Consumer Buying Process .

identification of buyer’s needs is important .Problem (or Need) Recognition  Prospective customer recognizes a problem or need  Need caused by internal or external stimuli  Internal stimulus – physiological like hunger or thirst or psychological like desire for the prestige of owning a Skoda car  External stimulus – Person sees a fresh pizza at Pizza Hut that stimulates his hunger  Whatever the cause.

butter. info search may be milder  For high involvement products (like a home.Information Search (or Collection)  An interested customer will search for more information  For low involvement products (like bread.involves visiting retail stores. the person may want an active information search…. biscuits). which are routinely purchased. an automobile. asking family members and friends . or insurance) which requires more of an investment in time and money.

and price ◦ Eg.Evaluation of Alternatives  No single evaluation process used by all consumers or by one consumer. For tires. the preferred attributes are price. Characteristics consumers prefer for ceiling fans are adequate air. less noise. . Understand the following factors: ◦ Consumer trying to satisfy a need or solve a problem ◦ Consumer looking for certain advantage or benefits from the product or service that satisfies the need or solves his/her problem ◦ Consumer knows that each alternative product or brand has a set of characteristics (or attributes) ◦ Importance and relevance of attributes vary from product to product ◦ Eg. color to match the décor.

8 0.6 0.6=15 20*0.8=24 25*0.5 Brand Supplier Score 30*0. in a rational system of evaluation Some consumer buy products/services based on emotional reasons (+ve or – ve)  .6=15 25*0.6 0.5=10 64 The brand/supplier’s score of 64 is worked for one specific brand/supplier This process is repeated for other brands or supplier also The brand/supplier who gets the highest score receives the order from the consumer.Example of an evaluation system followed by a consumer for buying a set of tires  A Brand/ Supplier Evaluation System Attribute (Characteristics) Price Quality Safety Life Total             Weight (Importance) 30 25 25 20 100 Brand/ Supplier beliefs 0.

b) timing of purchase.Attitude of others – friend. newspaper. relative. etc.Unanticipated situational factors – other product purchase becoming more important. 2. boss. purchase decision include: a) brand decision.Purchase Decision  Consumer forms preferences among brands and also an intention to buy the most preferred brand in the evaluation stage  Purchase intentions can be changed by two factors 1. d) from which . financial problem. published reviews in magazines. c) quantity. health related problems  Decisions are also influenced by perceived risk  For high involvement product. chatrooms.

and product uses Satisfied customers will buy the product again (repeat purchase) and will also act as good brand ambassadors (Word of mouth publicity – the most powerful form of advtg.) Dissatisfied customers may return the product. actions. tell friends and relatives.Post Purchase Behavior        After buying the product /service. stop buying. consumer experiences some level of satisfaction/ dissatisfaction Product’s perceived performance viz-i-vis Buyer’s expectations Salesperson should monitor post – purchase satisfaction. or complain to the company Salespeople can take corrective action if they are in touch . take legal action.

Determination of characteristics and quantity of needed product/service 2.Development of specifications of product/service needed 3.Obtaining and analyzing supplier proposals .Buying Decision Process for Business Buyers 3 additional stages as compared to 5 stages of consumer buying process 1.

2.for cost reduction or quality .TV 3. office bldg.Change in supplier (or modified rebuy).New purchase (or new task) – CRM. milk 2. Car Buying Situations for Business Buyers 1.Limited decision making .Routine decision making – Groceries.Buying Situations or Types of Purchases For Household and Individual Consumers 1.Extensive decision making – Home.

leg position  Communication modes send three types of messages: acceptance. handshake. body angle. gestures and non verbal communication  Obstacles to communication ( cultural diff. disagreement 1. or outside interruptions) to be removed  Non verbal communication such as physical space between buyer and seller. visual aids. arm movement or position. body movements  Non verbal body language includes facial expressions. hand movements or position. appearance. caution.Effective communication Communication is a two way transmission of verbal and non-verbal information between a salesperson and a buyer  Use of words. Smiling pleasant expression with direct eye contact 2. Puzzled expression with little eye contact  .

and situation  Build a relationship based on mutual trust  Use the philosophy of “Keep It Sweet and Simple” (KISS)  LISTEN carefully to the prospect’s words.. feelings and thoughts and talk less  ENTHUSIASM towards the sales job and customer’s business  Use proof statements from objective sources to add credibility to sales .  Get feedback to uncover buyer needs by asking relevant questions  Empathize with the buyer’s feelings.Salespeople who are effective communicators. ideas.

quality and service .Sales Knowledge and Sales Related Marketing Policies Company knowledge Product knowledge Customers and Competitors knowledge Sales – Related Marketing Policies ◦ ◦ ◦ ◦ Pricing policies Distribution policies Promotional policies Product policies  Product mix New product ideas Product information.

collecting payments. traveling and waiting to meet customers  NO MAGIC FORMULA TO MAKE A SALE!!  So.The Sales Process  Activities grouped into selling and non selling activities  Selling activities – various steps of the selling process  Non selling activities – preparation of sales report. . How do you improve your chances of success??  Use various methods and techniques as a guide only…. obtaining market information.

Prospecting and Qualifying 2.Follow up and Service .Overcoming objections 6.The Personal Selling Process 1.Preapproach (Precall Planning) 3.Trial Close/Closing the Sale 7.Approach 4.Presentation and Demonstration 5.

family or organization that needs the product or service that the salesperson is selling and also has the ability to buy it  (Willingness + Ability)   Prospecting . Firm that is a probable prospect  Prospect is an individual.Prospecting is the process of identifying prospective buyers of the product  What is a sales lead? What is the difference between a sales lead and a prospect?  A sales lead generates the name of a person or a biz.

firms Costly and time consuming. commercial dotcom vendors Salespersons become members of Lions Club. etc. no. 1 2 3 4 5 6 Prospecting methods Referrals from existing customers Referrals from internal company Referrals from sources sources external Networking by salespeople Industrial directories Cold canvassing Brief description Requesting existing customers to suggest the names advertising. intermediaries. Convincing source of nearly of 2/3rdteleprospecting activities trade shows and of leads bankers. .Prospecting Methods Sr. Rotary Club. direct mail. associations. to meet people Yellow pages published by government whoprivate publishers sales people on and may be prospects or may provide Unannounced calls by leads that may need product/service. Company of prospects. trade Suppliers. website.

The Ferris Wheel  The Ferris Wheel concept is part of world sales record holder Joe Girard’s customer strategy and is aimed at supplying an ongoing list of prospects Prospect In Referrals Friends and acquaintances Directories Trade publications and trade shows Telemarketing and advertising database Computerised Cold calling Networking   Prospect Out Relationship between customer and salesperson Biz. Failure deterioratesbuys from New buyer another source mergers Acquisitions and Customer moves Death of a customer Customer has only a one time need needs change Customer because of new technology .

Qualifying          Lead or probable prospect is qualified To meet the necessary standards or conditions to receive further attention Willingness + Ability Prospects after qualifying are placed in three groups: hot prospects. If they follow up a sales enquiry as compared to 40% share if not followed up Takes an average of 4 calls to convert initial enquiry into sales . warm prospects and cold prospects Hot prospects – company’s salesperson Warm prospects – telemarketing team for follow up Cold prospects – dealers/distributors or kept in pending list for future follow up Sales people get more than 80% of the buyer’s biz.

Tentative judgment of which ◦ Planning the sales strategy – . trade magazines. purchasing practices. the major problems or issues faced by prospect. existing customers and suppliers. industry report. locations of plants. etc. its products and services.Pre approach Information prospect’s biz. names and background of people making buying decisions. Sources are internet or online information services. industrial directories. and government publications gathering – Planning the Sales Call ◦ Setting call objectives - understanding needs and buyer orientation and preparing a sales pitch/presentation Consists of finding out when and whom to visit by a phone call followed by a visit. annual reports of companies.. chambers of commerce. purchasing orientations and practices.

attitude. opening line Some approaches like free gifts or dramatic alternatives may not be liked Select an appropriate approach that will get the attention and arouse .Approach Meeting the buyer for the first time Can MAKE or BREAK a sale! Has to be a favorable first impression Initial impression based on appearance.

m. Introductory technique 2 3 approach Customer benefit approach Product approach and Co.or organization) has individual Carry new or its cutawayit and appeal to cross-section in order to make a smooth transition to the sales presentation Kumar from Kirloskar. unique Usefulif product is (an generally a Present biz. precede by a Identify one major buying friendly and smiling greeting motive (or handshake or that and a firm benefit) new. here for the 11a.’s name. Card is presented afterget plan. “By convertingwith firm handshake and appointment” your existing insurance policy tosmile.Approach techniques commonly used Sr.000 more coverage at the same price salesperson hands over Rs. Mr. card Namaskar. Sharma. Biz.00. Name of the Brief description Example/Application 1 Salespersonstates his/her name “Good morning. prospect product or colorful. you can friendly our new insurance the new bottle of The2. this to the retailer and waits for the retailer Pepsi paying now you are to begin the conversation . I am Sanjay No.

and comfortable that I would Hence. thanks”. 4 no. a question linked to rememberbenefit or making a our customer it when we design new office” or “Congratulations on prospect curious should be asked. 5 Name of the Brief Description Example/Application Question approach The salesperson asks a question to start Typical question – “May technique Praise approach a two-way conversation or to make the An indirect praise conveyed sincerely prospect curious about the product or and subtly can have a positive impact service on the prospect I help you?” The prospect may “Your answeris so well designed easily office with “No. Sr.Contd…. “ your promotion to General in a What benefits you want most Manager” new washing machine? Or “Do you know why most organizations are using this brand of photocopier” .

Understanding the buyer’s needs 2.Developing an effective presentation .Presentation and Demonstration 1.Knowing sales presentation methods (strategies) 3.

Have you experienced any problems on the quality or delivery from the existing suppliers? Or Which parts of existing system create errors?  Problem impact questions – to make the buyer realise the impact or consequences of the problem and the need to solve the problem. Eg. Or Are you buying this product for the first time or making a change from the existing supplier?  Problem identification questions – to identify or uncover the customer problems. Most important questions and a lot of these should be asked. Eg. Eg. What impact the quality and delivery problems will have on your costs and customer satisfaction? Or What impact the errors in your system has on your customers?  . Who are involved in buying decision making for this product/service?. difficulties or needs. ASK QUESTIONS…  Understanding the buyer’s needs Situational questions – about prospects current situation or any facts the salesperson needs.

to help buyer assess the value or usefulness of a solution. would you be interested? or Would you be interested to know how our service can minimise the errors in your system to zero level?   Ask fewer situational questions and more questions on problem identification and impact and solution value . how much amount would you save? Or How would an error free system help? Confirmation questions – to get confirmation from prospects to hear about products/service. If I can show you the proof that our component supply would reduce the rejection rate to less than 0. If the rejection rate due to the quality of this component is reduced to 0.5%. Eg.5%. Eg.Contd…   Solution value questions .

Knowing sales presentation methods Stimulus response method Formula method Need – satisfaction method Team selling method Consultative selling method .

SP presents all the features of the product and then asks the prospect to buy the product Mostly used by tele-marketing people. a memorized sales presentation or a prepared sales presentation Assumes that if SP makes the right stimuli (presentation). and for training new salespeople (when time for sales presentation is short and product is non-technical) Not very effective .Stimulus response method       Canned approach. door-to-door salespersons. then he can get favorable response SP does most of the talking Without knowing the needs of the prospects.

genuine smile. Ask relevant questions to understand need or problem and identify appeal ◦ Desire – arouse strong feeling of wanting product/service. Is to put prospect in receptive mind. prior appointment ◦ Interest – finds out what aspects or factors of the product appeals. Demonstration to solve problem. Carry sample of product or visual aid like CD. Objective of first few mins. leaflets. Objections are overcome ◦ Action – buying action or closing the sale. neatness.Formula method  Also based on stimulus response thinking and also known as ‘formulated approach’ or ‘mental states selling’.  . photos. Assume that most buyers can be led thru mental steps in the buying process and hence use a well know formula which has four stages: AIDA ◦ Attention – makes favorable comment about the prospect or the prospect’s biz. arousal of customer’s curiosity. Proper dress. cheerfull expression.

Need satisfaction method Most challenging and creative form of selling  Interactive sales presentation  Understanding buyer’s needs and only after clearly understanding the needs do we move into sales presentation to show how our product/service can better address the need/problem than any competitor FAB Analysis Ø Features – “Our ceiling has two ball bearings” Features/characteristics of product/service/market offering Ø Advantages – “Because of the ball bearings. our ceiling fans make hardly any noise and have a longer life” how the feature gives help/advantage to the prospects Ø Benefits – “ Our ceiling fans are used in class rooms where noise level should be low as needed by you” how feature and advantage meets a clear and detailed need expressed by the prospect  .

as needed by you Electric motor Annual maintenance We have 12 service contract engineers (AMC) for computer systems This will ensure quick service Our service person will attend to your service needs within eight working hours as desired by you Lift table or loading We have offered a and unloading customized design to take equipment care of your loading and unloading tasks Our lift-table will reduce the Time taken for loading time taken for loading and and unloading of your unloading your finished goods goods is reduced by 50% substantially as required by you .Use of FAB Approach Product /Service Feature Special design for low voltage application Advantage This means the equipment like pump sets can be used even under low voltage situations Benefit Our motor can be used even when you have low voltage conditions.

consultant. customized products and services. 3M. should be used for major accounts High sales and profit potential Used for complex selling situations. Siemens IBM – client executive. of organisations are using it Mutli-sales team to deal with multi-person buying centres (or buying committees) Not the best alternative in all selling situations Expensive. systems engineer. long term contracts and new customers Should not be used for low sales and profit customers as also for repeat customers who can be served by a single salesperson IBM. HP. Xerox.Team selling method          Latest development and growing no. Wipro. product representative .

Relationship Process between a Sales Team and a Buying Centre Members  Sales team Buying centre Major accounts executive Technical support engineer Logistics executive Information system executive Finance executive Exchange/ Purchase/materials executive Relationshi Operations manufacturing executi p Process Logistics/supply chain executive Materials manager Finance executive .

Group presentation Need – analysis Introduction Convincing Specific – benefits Well prepared .

Consultative Selling method (or problem –solution presentation) knowledge of the  SP should have in-depth customer’s company and the industry and carry out detailed analysis of the problems or needs  Should be aware of key members of the customer’s buying centre and get their acceptance of the needs  Prepare proposal for solving the buyer’s problems and make sales presentation  Use selling firm’s cross-functional expertise to provide solutions  Build long term relationship /partnership  What is the diff. between Team selling and Consultative method?? Achieve strategic goals also .

 Ever

tasted a bite in a sweet shop..  Test drive your car!  Demo of industrial products…  Doubt’s and objections are cleared and questions are answered. Improves purchasing interest  Good support in the selling process  Helps to bring out specific features and benefits to the prospective customer competition  Be sure about product/service before demo or it may backfire

Developing An Effective Presentation
Planning Use

technology Adapt presentation Benefit plan Don’t overload Prospect’s language Convincing

Matching presentation methods with situations
Sales Presentation methods Stimulus-response, canned or memorised Formula, formulated approach, mental states Need satisfaction Consultative or problem method Suitable Sales Situations Selling time short. Product is simple and nonor repeat SP Straight rebuy technical. with less experience. Door to purchase situation.for is Creative. Suitable Cm door selling or technical SP familiarhi-cost telemarketing industrial products, consumer Selling with product and is aware of buyer’s need SP durables products where products or services like has to understand the needs computer hardware or first software, power transformer and furnace

resistance or opposition typically take place during sales presentation or when salesperson asks for the order OBJECTIONS SHOULD BE WELCOMED!! Shows that the prospect has interest and if answered satisfactorily.Overcoming objections       Objections. preference for established brands. dislike of making decisions. it would result in sales Two types of objections – psychological (or hidden) and logical (practical or real) Psychological objections – predetermined ideas or beliefs. product quality or product availability  . high price. anxiety or resistance to spend money Logical objections – Quicker delivery schedules.

Methods of handling and overcoming objections Ask question Turn an objection into a benefit Deny objections tactfully Third – party certificate Compensation  .

” SP then explains the benefits of the product to make it worth the price   First listen to the buyer’s objection carefully.  Clarify the objection by rephrasing it into a question  Get buyer’s acceptance of the question    . Do you want to know why the price of my product is slightly higher than that of another supplier” BUYER: “Yes.” SP: “I accept your concern. that’s what I want to know.Ask Questions BUYER: “It seems price of your product is higher than your competitor.

as we need it in about 2 weeks. With 4 weeks delivery.Turn objection into a benefit  PROSPECT: “The delivery time of 4 weeks for your equipment seems too long . but this equipment is specially designed and manufactured to your specific needs.” SP: “I appreciate your point. so that overall it would be 5 weeks or earlier. we can do installation on less than 1 week. so that including installation and commissioning the project will have to be completed in 5 weeks from now. Is that OK with you?”  Very powerful method  An experienced salesperson with a positive attitude and quick thinking can turn on objection into a benefit or a reason to buy  .

we had a few problems. objections are incomplete or not correct  Tactfully deny objections either directly or indirectly  SP should not be arrogant or sarcastic when he denies incorrect objections   . If he gives you a good opinion. but we solved all those problems within 6 months at our factory and also at our customers’ premises free of cost. our sales are highest as compared to other brands and you can check with your friend now about the performance of the vehicle.Deny objections tactfully BUYER: “I don’t want to buy your car. I agree. because a friend of mine told me that he had a lot of problems when he purchased your newly launched vehicle two years ago. would you buy our car?”   Sometimes. In the last one and a half years.” SP: “Yes. two years ago when we launched our new brand of car.

of the customers who having been using the product or service Favorable response helps seal the deal Eg. prospects takes initiative and asks the SP to give the name and nos. Before buying 6 nos. Bangalore not only visited the manufacturer’s plant but also went to Ashok Leyland’s plant at Hosur to see the performance of the the equipment as well to know the quality of service. including the availability of spare parts .Third party certificate       Testimonials or referrals Use some other customers’ experience of using the product as a proof or testimony Get prior approval from such customers Sometime. of equipment used in loading and unloading of trucks. ITPL.

buyer has a valid objection  SP offers some kind of compensation or benefits to counter balance the objections Example  Reliance Industries wanted to buy certain handling equipment for the first time for their factories in Gujarat from a manufacturer located in Karnataka.Compensation Sometimes.  Assurance satisfied customer who place an order initially for a small value with an assurance to place substantial value of orders subsequently   . Reliance raised an objection about efficient warranty service and aftersales service  SP promised to station one service engineer at the customers’ premises for a year and thereafter open a service centre near Reliance Industries premises.

then SP should go back to the presentation (since FAB is not liked by prospect)  . Am I right” Why is trial close used? q If closing is tried without this and prospect gets “no” as an answer. it is difficult to change mind of prospect q If prospect answers favorably to trail close questions. then it is time to close the sale q If feedback is negative.Trial Close Trial close .Checks the attitude or asks the opinion of the prospect  Does not ask the decision of the prospect to buy  Used after sales presentation after an objection is answered or before closing the sale Example  To what extent this product meets your needs?  Which of these benefits are important to you?  Out of the three models that are here. I think you like this model.

U n fa vo ra b l re sp o n se e S a l sp e rso n m a ke s a p re se n ta ti n e o G o b a ck to th e p re se n ta t S a l sp e rso n u se s a tri l cl se e a o S a l sp e rso n a n sw e rs p ro sp e ct’ s o b j cti n s e e o C l se th e sa l s o e Fa vo ra b l re sp o n se e .

Closing techniques Alternative choice close Minor points close Assumptive close Summary of benefits close T –account (or modified T-account) or balance sheet close Special offer (or special deal) close Probability close Negotiation close .

I prefer this model”. or kind of objections  Objections has to be then satisfactorily handled to close the deal  Effective if used correctly .Alternative Close  Prospect is given a choice between two or more items or models and not between buying or not buying  “Which of the three models do you prefer?”  By giving a choice. either the SP gets a “yes.

which model would you prefer?”. “Would you like to pay on installment basis?”  Develops a positive inclination towards the product .Minor Points Close  Similar to Alternative point  Sometimes easier for prospect to decide on many minor points than to make a bigger decision on whether to buy or not buy  By having the prospect make decisions on a product’s minor points. the SP can cleverly lead into the decision to buy  “If you buy this solar heater. “How soon would you like it to be delivered”.

Assumptive Close  Effective when SP has earned the customer trust to such an extent that SP prepares the order and hands it over to the customer for his signature  SP assumes that the prospect will buy and conveys his assumption through comments and non verbal actions  Comments – “Would you like to take it with you or have it delivered?”  Non verbal actions – Starting to wrap the package or getting out the credit card charge plate machine .

due to which it uses less electricity (advantage). Let customer talk) 3. benefits) statements and SELL sequence (Show feature. simple an straightforward 1. during the sales presentation 2. which results in 15% saving in your electricity bill (benefit). Lead into benefit. Find out the important benefits of product/service that appeal to the prospect. advantages. Explain advantage. Make a proposal Illustration:  The AC SP would say: “Our AC has a high efficiency rating (feature).Summary-of-benefits Close Very popular technique. isn’t it?” (trial close)  If response is favorable. Summarize these benefits by using FAB (features. That’s good. then SP – “ When do you  .

“M’am.T-account (or modified Taccount) or balance sheet Closesheet of paper and draw a large T on it  Take a       Place ‘to act’ (or assets) on left side and ‘not to act’ (liabilities) on right side Write all positive points (advantages and benefits) on left side and all negative points on the right side Eg. SP makes a list of positive points only and avoids the negative . In cleaning time (benefit). this vacuum cleaner’s high speed motor (feature) works very fast (advantage) with less effort (advantage) and saves about 20 mins. Which of these benefits do you like (write on left of T section)?” “Anything that you want us to improve on? (Right hand side)” Use trial close or overcome objections and close sale In modified T-account. We will also give you immediate delivery (benefit) and easy installation payment scheme (benefit).

the special offer or special deal may close the sale “If you buy the refrigerator today.Special offer (or special deal) Close When SP has done his best and prospect is still resisting. I can give you a discount of 2%. because I can reach my monthly quota” .

return to original position and start the selling process again . you will take the decision of buying”  If probability is more than 50%. the SP can convert the real objection to closing sales by various techniques.Probability Close  Is used when the prospect says “I will think it over” or “I will let you know”  SP allows real or hidden objections to come out by asking the prospect “Please tell me what is the probability in % terms that next week when I call you back. In such a case. If probability is less than 50%. the chances of closing the sale is low.

Negotiation Close  Most deals are closed after successful negotiations  The attitude and style of negotiations determines outcome  Positive and helpful  Win-Win style  Helps build mutually beneficial relationship  Negotiation skills – a must for any Salesperson .

.    .  .Closing techniques Sales Situations Buyer is hostile Buyer is a friend Neg Proba SpeciT.  . . Buyer has certain opinion .  . . unt .Sum Assu Mino Alte otiat bility al acco mary mptiv r rnati ion offer unt of e points ve or benef choi modi its ce fied Tacco . . . large ego . in advance Buyer is an expert with a . decision Buyer is selfish or greedy .   .  Buyer is unable to make a . . .  .  .

Follow up and service Check customer order Plan follow up visit at the time of delivery Account penetration Relationship marketing .

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