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Chap 5 Tanner - B2B & CRM
Chap 5 Tanner - B2B & CRM
5-1
Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall.
Sales Management: Shaping Future Sales Leaders
Business-to-Business
(B2B) Sales and Customer
Relationship Management
Chapter 5
5-2
Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall.
Learning Objectives
Recognize how people make organizational purchasing
decisions
Describe and explain the three buying situations
Identify the different roles played by buying center members
Understand individual forces that influence the B2B buying
process
Comprehend how buyer-seller relationships are established
and maintained
Explain success factors that apply to buyer-seller relationships
Discuss seller performance factors that lead to successful
customer relationships
5-3
Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall.
Understanding B2B Purchasing
Decisions
Personal relationship skills
Highly skilled sales force
Constant support from
other functional groups,
especially sales managers
Information technology
system that’s easy to use
and gives accurate and
near-real-time information
5-4
Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall.
The Buyer’s Decision-Making Process
5-5
Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall.
Organizational Buying Situations
5-6
Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall.
The Buy-Grid Framework: Participation in the
Buying Stages of the B2B Buying Process
5-7
Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall.
Understanding the Buyer’s Criteria
A multi-attribute matrix is used to evaluate
vendors by assigning an importance weight to
categories like price, product conformance,
delivery time, and manufacturing capacity
Attribute Weight Vendor A Vendor B
Quality .5 9 = 4.5 7 = 3.5
Delivery .3 8 = 2.4 9 = 2.7
Customer Service .2 10 = 2.0 8 = 1.6
Totals 1.0 8.9 7.8
5-8
Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall.
Buying Center, or Group, Purchases:
Roles of the Decision-Making Unit
Initiator: starts the Influencers: individuals
purchase process by who affect the decision
recognizing a need maker’s final choice
through recommendations
Decision maker: about which vendors to
person/committee that include or which products
makes the final decision will best meet needs
Purchaser: any person Users: their jobs require
who actually buys the that they implement and
product evaluate what was
Controller may approve or purchased
set budget for purchase Gatekeepers: control
information
Screens and filters
5-9
Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall.
Team Selling and Multi-Level Selling
Extended selling team advantages
Quicker response to buyer questions
Ability to speak to one’s counterpart who
understands technical language
Capability to work as a group to offer
multidisciplinary solutions to complex buyer problems
Challenges
Coordination, communication, and compensation challenges
More expensive
5-11
Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall.
Team Selling and Multi-Level Selling
Multi-level selling occurs when two or more
people from the selling firm make a sales call to
their functional counterparts at the buying
organization
Marketing alliances 2+ companies combine
their technologies, unique resources, skills and
products to market total systems
Value-added reseller (VAR) purchases products
from manufacturers and assembles them into a
system before delivering the package to
specialized customer segments
5-12
Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall.
B2B Customer Relationship
Management
5-14
Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall.
Technology in Sales Management
Technology can help ensure a firm’s sales are
profitable
Programs analyze orders for profitability as they
are placed
Companies are dropping losing product lines and
unprofitable customers
Source: Based on Jaclyne Badal (2006). “A Reality Check for the Sales Staff,” Wall Street Journal,
October 16, B3.
5-15
Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall.
Data Mining
Companies data mine information collected in
CRM databases
Purchase dates, incentives offered the customer,
product/services purchased, selling price, the buyer’s
position in the organization, number of rep visits
between buys, and samples and promotional materials
requested
Allows identification of important relationships or
“connections” that might not be readily apparent
Can conduct competitive analyses that result in higher
sales revenues, lower order entry errors, and increased
acquisition of new customers
5-16
Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall.
Customer-Centric Sellers
CRM technology helps firms
become more market- or
customer-oriented
Firms practice a market
orientation when business
processes and functions are
aligned to maximize
effectiveness in the
marketplace
A market-oriented selling
firm places the buyer at the
center of all of the strategic
decisions
5-17
Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall.
The Nature of B2B Relationships
5-18
Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall.
Differences in Key Variables Based on
Stage of Relationship
Relationship Transactional Facilitative Integrative
5-19
Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall.
Global Sales Management: Forming
Business Relationships in Other Cultures
In many cultures around the world, it takes years to
Ellesmere Island Severnaya Zemlya
Arctic Ocean Arctic Ocean Franz Josef Land
Arctic Ocean
New Siberian Islands
Greenland (Den.) Svalbard (Nor.)
Banks Island Jan Mayen (Nor.) Novaya Zemlya Wrangel Island
Victoria Island Baffin Island
Canada
Iceland
Faroe Is. (Den.) Norway
United Kingdom
Den.
Sweden
Finland
Estonia
Latvia
Lithuania
Russia 60°
Aleutian Islands (USA)
Ireland Neth. Belarus
Germany Poland
Bel.
Island of Newfoundland Czech. Ukraine Kuril Islands
S. Korea Japan
North Pacific Ocean Cyp. Leb. Syria North Pacific Ocean
1
Probability of future purchases
2
Future marketing costs
3
Future contribution margins
5-21
Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall.
Computing CLV
5-22
Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall.
Planning Sales Strategy Based on CLV
Low % of Purchase Share High % of Purchase Share
Constant sales force
Frequent sales force visits
interaction
Monthly visits
Weekly visits
High Lifetime
Direct mail/telemarketing
Earning Value Direct mail/telemarketing
Optimal contact: biweekly
Optimal contact: weekly
High potential customer value
Highest customer value
Extended sales force visits Infrequent sales force visits
Yearly intervals 6-month intervals
Low Lifetime
Direct mail/telemarketing Direct mail/telemarketing
Earning Value
Optimal contact: quarterly Optimal contact: bimonthly
Low value customer Low potential customer value
5-23
Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall.
The Stages of B2B Customer
Relationship Management
1
Up-sell / cross-sell to existing
customers
2
Manage customer relationships
to earn higher profits
3
Offer customized solutions to
most profitable buyers
5-24
Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall.
Inspiring Your Team Members to
Build Business Relationships
According to a recent Sales & Marketing
Management® article:
B2B salespersons are becoming strategic advisors
Point of differentiation is ability to form successful relationships
How can sales managers inspire their sales team to
form genuine relationships?
Sales managers must help salespersons make “REAL”
connections
Release the outcome
The end result does not define the salesperson
Best to focus on what is learned during the sales process
Emotions
Connect emotionally to the buyer’s reason to purchase
Important to express empathy
5-25
Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall.
Inspiring Your Team Members (continued)
Accountability
Easy to identify a goal; harder to commit to achieving
Sales manager should set goals and communicate their progress
Discuss importance of accountability with team members
Likeable
Inspire team members to see themselves from buyer’s
perspective – assess their behaviors
Get team members to think positively and congratulate
themselves for expanding their comfort zones
First and most important step in building relationships
must come from within!
Based on: Rick Wnuk, “Keep Your Team Members Real,” Sales & Marketing Management,
September/October 2008, 16-17.
5-26
Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall.
Maximizing the Buyer’s Value
Value
Benefits Functional Benefits + Emotional Benefits
Costs
= Monetary Costs + Time Costs + Energy Costs + Psychic Costs
Increase value by
1 Increasing benefits
2 Decreasing costs
3 Both
5-27
Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall.
Risk and the Organizational Buyer
Easiest and least
expensive way to
reduce risk is by
sharing information
CRM system provides
common information
within the sales
organization that can
improve the probability
of higher customer
service levels
5-28
Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall.
Important Salesperson Behaviors
Meeting commitments
5-29
Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall.
Why Business Relationships End
Partner is too complacent
Goals no longer match
Cultures have diverged
1 or both parties have
behaved irresponsibly
5-30
Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall.
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