Relationship selling through service mkt 173 chap 5e

Main Topics  The Tree of Business Life: Knowledge  Sources of Sales Knowledge  Knowledge Builds Relationships  Know Your Customers  Know Your Company  Know Your Product... Main Top

Sales Knowledge: Customers,

Main Topics

 The Tree of Business Life: Knowledge

 Sources of Sales Knowledge

 Knowledge Builds Relationships

 Know Your Customers

 Know Your Company

 Know Your Product

Main Topics

 Know Your Resellers

 Advertising Aids Salespeople

 Sales Promotion Generates Sales

 What’s It Worth? Pricing Your Product

 Know Your Competition, Industry, and Economy

 Personal Computers and Selling

Main Topics

 Knowledge of Technology Enhances Sales and

Customer Service

 Sales: Internet and the World Wide Web

 Global Technology Provides Service

The Tree of Business Life: Knowledge

Guided by The Golden The Golden

Rule:

 Be an expert on everything associated with your product(s).

 Use wisdom when applying knowledge.

 Remember, customers rely on you

to truthfully provide knowledge and wisdom.

 Realize that people do not care how much you know until they know how much you care.

Sources of Sales Knowledge

provide the opportunity for the salesperson to receive job-related attitudes, concepts, rules, and skills that result in improved performance

Education, Reading, and Word-of-mouth

Sources of Sales Knowledge

Selling is a skill developed through experience

Knowledge Builds Relationships

Knowledge increases a salesperson’s confidence,

and, Knowledge increases a buyer’s confidence in the

salesperson

Thorough knowledge about your product is needed to

gain the buyer’s confidence

More knowledge, more confidence mean more

relationships,

and…

More relationships mean more sales

Know Your Customers

Know Your Company

 General company information:

Company growth and accomplishment

Policies and procedures

Production facilities

Service facilities – promise of prompt repair services can help make a sale

Know Your Company’s Policies & Procedures

 The salesperson should let the buyer know:

 How his order will be processed

 How long it will take for her to receive her order

 The policy on returned goods

 How to open a new account

 What to do if he receives the wrong shipment

Know Your Product

 Product knowledge may include:

Performance data

Physical size and characteristics

How the product operates

Specific Features, Advantages, and Benefits of the product

How well the product is selling in the marketplace

Know Your Resellers

Understand the channel of distribution

The Channel of Distribution

Know Your Resellers

 Know as much about each channel

member as possible

 Likes & dislikes of each channel member’s

customers

 Product lines assortment each one carries

 When each member sees salespeople

 Their distribution, promotion, and pricing policies

 What and how much of a product each has

purchased in the past

Advertising Aids Salespeople

Advertising Aids Salespeople

Why Spend Money on Advertising?

 Main ingredient of a firm’s promotional effort

 Companies advertise because they hope to:

 Increase overall sales and sales of a specific product

 Give salespeople additional selling information for sales

Why Spend Money on Advertising?, cont…

 Inform prospects that a product is on the market and where to buy it

 Reduce cognitive dissonance over the purchase

 Create sales or pre-sell customers between sales calls

Types of Advertising, cont.

Types of Advertising, cont.

Industrial Advertising

Aimed at individuals and organizations who

purchase products for use in manufacturing

other products

 Ads, samples, and coupons mailed directly to the consumer or industrial user to expose

him to or remind him of the product

 May solicit response

Types of Advertising, cont.

Sales Promotion

 Promotional tool that simulates consumer purchasing and dealer interest by means of short-term activities

 Supplements personal selling, advertising, and public relations

 Examples: free samples, prizes, contests, and cents-off coupons

Sales Promotion Generates Sales

 Consumer sales promotion

 Trade sales promotion

Sales Promotion Techniques

Sales Promotion Generates Sales, cont.

 Point-of-purchase (POP) displays

Premiums

Premium

Article of merchandise offered as an

incentive to the user to take some action

 Purposes of Premiums

Promote customer sampling of new product

Introduce new product

Encourage point of purchase display

Boost sales of slow products

Sales Promotion Generates Sales

 Premiums

 Sweepstakes and contests

 Consumer premiums

 Dealer premiums

Sales Promotion Generates Sales

 Sales promotion on the Internet

Exhibit 5-2: Advertising and Sales Promotion Information the Salesperson Provides the Buyer

What’s It Worth? Pricing Your Product

 Price refers to the value or worth of a product

that attracts the buyer to exchange money or something of value for the product.

Exhibit 5-4: Examples of Prices and Discounts Salespeople Discuss in Their Sales Presentations

about the industry

and the economy

 Travel and expense reports

 Checking inventory/shipping status

Knowledge of Technology Enhances Sales

and Customer Service

 Personal Productivity:

Contact management

Calendar management

Automate sales plans,

tactics, and tickets

Geographic information

system

Computer-based

presentations

Knowledge of Technology Enhances Sales

and Customer Service, cont…

 Communications with Customers and

Employer (allows for quick delivery of information to customers and employers):

Word processing

E-mail

Fax capabilities and support

 Customer Order Processing and Service

Support (shortens sales and delivery cycle)

Salespeople's mobile offices

Exhibit 5-10: Web Sites Can Provide Valuable Information to Salespeople

Global Technology Provides Service

 Increased worldwide interaction

Summary of Major Selling Issues

 Company knowledge includes information on

Summary of Major Selling Issues, cont…

 To reduce conflicts and aid channel members in selling products, manufacturers offer assistance in:

 Advertising

 Sales promotion aids

 Pricing allowances

 National, retail, trade, industrial, and direct-mail

advertising create demand for products and are powerful selling tools in sales presentations

 Success in sales requires knowledge of the many technologies used to sell and service customers.

Summary of Major Selling Issues, cont…

Sales Arithmetic and Pricing

 Salespeople should be able to confidently discuss price, discounts, and credit policies with customers.

Types of Prices

 List price – standard price

 Net price – after discounts

 Zone price – based on geographical

location

 FOB shipping point – buyer pays shipping

 FOB destination – seller pays shipping

 Ownership

 Price discrimination

Exhibit 5A-2: Types and Examples of

Discounts

 Money remaining after costs of marketing and

operating the business are paid

 Channel of distribution markup

 Markup arithmetic

 Return on investment

What Is Markup?

 Markup is the dollar amount added to the

product cost to determine its selling price.

 Markup is often expressed as a: percentage

What Is the Percent Markup?, cont…

 It depends on whether you use:

What Is the Percent Markup?

It costs a company $6 to manufacture a product that it sold for $10 to a wholesaler who in turn sold it to a retailer for $12 A customer of the retailer bought it for $24 What is the markup on selling price for

each member of this product’s channel of distribution?

Exhibit 5A-3: Example of Markup on Selling

Price in Channel of Distribution

Exhibit 5A-4: Example of Using Unit

Cost

Exhibit 5A-5: Profit Forecaster for Granola

Bars Shown to Buyer

3-Day Special 2-Week Special Normal

Total gross sales

Total gross profit

Return on investment (ROI)

100 June 1 – June 30

$21.60

- 6.36

$15.24 1.39

500a

$7,620b

$8,340c $720d9.0%e

100

$21.60

- 6.36

$15.24 1.39 1,000

$15,240

$22,680 $7,440 49%

100

$21.60

$21.60 2.19f1,500

$32,400

$39,420 $7,020 22%g

Skip video

Organizations: Value and ROI

 How do your product’s features, advantages, and benefits compare to the product currently being used?

 Can your product do the same job as your

buyer’s present product at a lower price?

 Does the buyer’s current equipment perform

better than required? (Equipment too good for

present use?)

 Will a higher-priced, better-performing product be more economical in the long run?