Slide 1To understand psychology in selling, buying decision process and buying situations
To learn communication skills, sales knowledge, and sales related marketing policies
To understand personal selling process
To learn about negotiation
Psychology in Selling
If a sales person makes a presentation, the prospect may or may not buy
The above “buyer behaviour model” does not tell us the reasons of buying or not buying
To understand the psychological aspects of selling or buying, salespeople should study consumer or buyer behaviour, including buying process and situations
Stimulus
Five – stage model for household customers
Eight – stage model for business buyers
Problem / need recognition
Information search / collection
Evaluate alternatives
Purchase decision
Post – purchase behaviour
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Buying process and situations differ for household consumers and business buyers.
Consumers / Buyers may skip or reverse some stages in buying process. E.G. A consumer buying toothpaste
Household customers
Business Buyers
Routine decision-making
Extensive decision-making
Major reasons for giving above information / knowledge through training programmes to salespeople are:
increase their self-confidence
Meet customers’ expectations
The Sales Process
As a part of selling activities, if salespeople follow the steps or phases shown below, their chances of success are far better.
Prospecting &
Qualifying
Preapproach /
Overcoming
Objections
The sequence of above steps may change to meet the sales situation in hand.
Some of the above steps may not be applicable for selling to the trade
We now discuss application of above steps to industrial selling
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Prospecting
It is identifying or finding prospects i.e. prospective or potential customers.
Methods of prospecting or sales lead generation are: (1) referrals from existing customers, (2) company sources (website, ads., tradeshow, teleprospecting), (3) external sources (suppliers, intermediaries, trade associations), (4) salespersons’ networking, (5) industrial directories, (6) cold canvassing
Qualifying
Companies qualify sales leads by contacting them by mail or phone to find their interests (or needs) and financial capacity.
Leads are categorized as: Hot, Warm, and Cool
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Sources of information: the Internet, industrial directories, government publications, intermediaries, etc.
Precall planning
Setting call objectives
Tentative planning of sales strategy: which products, features and benefits may meet the customer needs
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Make favourable first impression
Select an approach technique:
Product
Question
Praise
The approach takes a few minutes of a call, but it can make or break a sale
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Developing an effective presentation
We will examine each of the above points
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Firms and consumers buy products / services to satisfy needs
To understand buyer’s needs, ask questions and listen
In business situations, problem identification and impact questions are important
E.G.
Have you experienced any problems on quality and delivery from the existing supplies?
What impact the quality and delivery problems will have on your costs and customer satisfaction?
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Firms have developed different methods / styles / strategies of sales presentation
Stimulus response method / canned approach.
It is a memorised sales talk or a prepared sales presentation.
The sales person talks without knowing the prospect’s needs. E.G. Used by tele-marketing people
Formula method / formulated approach.
It is also based on stimulus response thinking that all prospects are similar.
The salesperson uses a standard formula – AIDA (attention, interest, desire, and action).
It is used if time is short and prospects are similar.
Shortcomings are: prospects’ needs are not uncovered and uses same standard formula for different prospects.
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First find prospect’s needs, by asking questions and listening
Use FAB approach: Features, Advantages, Benefits
Effective method, as it focuses on customers
Consultative selling method / Problem-solving approach
Salespeople use cross-functional expertise
It is used by software / consulting firms
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Plan the sales call
Communicate the benefits of the purchase
Present relevant and limited information at a time
Use the prospect’s language
Make the presentation convincing – give evidence
Use technology like multi-media presentation
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Sales presentation can be improved by demonstration
Demonstration is one of the important selling tools EGs: Test drive of cars; demonstration of industrial products in use
Benefits of using demonstration for selling are:
Buyers’ objections are cleared
Helps to find specific benefits of the prospect
The prospect can experience the benefit
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Objections take place during presentations / when the order is asked
Two types of sales objections:
Psychological / hidden
Logical (real or practical)
Methods for handling and overcoming objections: (a) ask questions, (b) turn an objection into a benefit, (c) deny objections tactfully, (d) third-party certificate, (e) compensation
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Trial close and Closing the sale
Trial close checks the attitude or opinion of the prospect, before closing the sale (or asking for the order)
If the response to trial close question is favourable, then the salesperson should close the sale
Some of the techniques used for closing the sale are: (a) alternative-choice, (b) minor points, (c) assumptive, (d) summary-of-benefits, (e) T-account, (f) special-offer, (g) probability, and (h) negotiation
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Check order details
Build long-term relationship
Arrange warranty service
When to negotiate?
(a) When the buyer puts certain conditions for buying to the seller, (b) When agreement between the buyer and the seller is needed on several factors, (c) When the product is customised, (d) When the final price is to be decided
How to prepare for negotiation?
(a) planning, (b) building relationship, (c) purpose
Styles of negotiation
(a) I win, you lose, (b) Both of us win (or win-win style), (c) You win, I lose, and (d) Both of us lose
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For understanding psychology in selling, study consumer or buyer behaviour, buying process and situations
Salespeople are given knowledge of sales and relevant marketing policies in order to increase their self-confidence and sales, and meet customers’ expectations
Typical steps in the sales process include prospecting and qualifying, preapproach, approach, presentation and demonstration, overcoming objections, trial close / closing the sale, follow-up and service