02. PERSONAL SELLING, Study notes of Negotiation

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02. PERSONAL SELLING

• Definition, Meaning, Major Aspects
• Personal-selling Situations (Types of Selling Jobs)
• Buyer-seller Dyads
• Theories Of Selling
• Scientific Selling Process

PERSONAL SELLING - Definition,

Meaning, Major Aspects

• Personal selling is a personal (face-to-face, telephone, or Internet chat) presentation for the purpose of making sales and building relationships.
• Three major aspects of personal selling: Professionalism, Negotiation and Relationship Marketing

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Personal-selling Situations (Types of

Selling Jobs)

• Different sales positions require different amounts and kinds of service and developmental selling.
• Service selling aims to obtain sales from existing customers
• Developmental selling aims to convert prospects into customers.

Personal-selling Situations (Types of Selling Jobs) Sales Positions by McMurry and Arnold GroupA (Service Selling)

1. Inside Order Taker ‘ waits on’ customers 2. Delivery Salesperson engages in delivering the product 3. Route or Merchandising Salesperson operates as an order taker but works in the field 4. Missionary Salesperson aims only to build goodwill or to educate users, and is not expected to take order 5. Technical Salesperson emphasizes technical knowledge GroupB (Developmental Selling) 6. Creative Salesperson of Tangibles aims to convert prospects into customers of tangible goods 7. Creative Salesperson of Intangibles aims to convert prospects into customers of intangible goods GroupC (Developmental Selling Requiring Unusual Creativity) 8. ‘Political’, ‘Indirect’ or ‘Backdoor’ Salesperson sales are consummated through rendering highly personalized services which have little or no connection with the product 9. Salesperson Engaged in Multiple Sales salesperson must make presentations to several individuals in the customers organisation

A Model of Buyer-Seller Dyadic Relationships

Feedback Feedback Salesperson Customer Start Salesperson-Customer Relationship Exchange Personal Affiliation Choice of Strategy Needs and Expectations Personal Characteristics Role Requirements & Characteristics Choice of Strategy Needs and Expectations Personal Characteristics Role Requirements & Characteristics Negotiation Adapt (^) Adapt Adjustment Stop Experience Experience

THEORIES OF SELLING

• AIDAS Theory of Selling
• ‘Right Set of Circumstances’ Theory of Selling
• ‘Buying Formula’ Theory of Selling
• ‘Behavioural Equation’ Theory

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AIDAS Theory of Selling

Securing Attention: The goal is to put the prospect in a receptive state of mind. Gaining Interest: The goal is to intensify the prospect’s attention so that it evolves into strong interest. Throughout the interest phase, the hope is to search out the selling appeal that is most likely to be effective. Kindling Desire: The goal is to kindle or stimulate the prospect’s desire to the ready-to-buy point. The salesperson must keep the conversation running along the main line toward the sale. Obstacles need to be identified and ways found to get around them. Inducing Action: The goal is to induce the prospect to act – that is, to buy. It is up to the salesperson to sense when the time is right. The trial close and other different closing techniques are used to test the prospect’s reactions. The desired action is to make the prospect give consent for the sale, sign on the dotted lines of the order pad, and pay for the good or service that was being showed to him. Building Satisfaction: The goal is to reassure the customer that the decision was correct. Building satisfaction includes thanking the customer for the order and following up on promises made during the presentation. It also includes building up a long term relation with the prospect.

THEORIES OF SELLING

‘Right Set of Circumstances’ Theory of Selling

• Also called the ‘situation-response’ theory
• May be summed up by the statement “Everything was right for that sale”.
• Holds that the particular circumstances prevailing in a given selling situation cause the prospect to respond in a predictable way.
• If the salesperson succeeds in securing the attention and gaining the interest of the prospect, and if he presents the proper stimuli or appeals, the desired response, that is the sale, will result.
• The more skilled the salesperson is in handling the set of circumstances, the more predictable is the response.

THEORIES OF SELLING

‘Behavioural Equation’ Theory

Four essential elements of the learning process included in the stimulus-response model are: Drives : Strong internal stimuli that impel the buyer’s response. Cues : Weak stimuli that determine when the buyer will respond. Response : What the buyer does. Reinforcement : Any event that strengthens the buyer’s tendency to make a particular response. Howard incorporates these four elements into an equation:

B = P x D x K x V

where, B = response or the internal response tendency P = predisposition, force of habit D = drive level (amount of motivation) K = incentive potential (potential satisfaction to the buyer) V = intensity of all cues

Scientific Selling Process

1. Prospecting and Qualifying **2. Pre-Approach & Approach

3. Presentation and Demonstration
4. Overcoming Objections
5. Closing
6. Follow-Up and Maintenance**

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Scientific Selling Process

1. Prospecting and Qualifying

• Prospecting and qualifying is the process of identifying potential buyers
• A prospect list or pool, which consists of a group of names, gathered from various sources
• Identifying prospects is also referred to as lead generation and prospects are referred to as leads****.
• Q ualified prospects are also known as potential or prospective customers.

Scientific Selling Process

1. Prospecting and Qualifying

Steps in Prospecting

• Formulating prospect definition
• Searching out potential accounts
• Qualifying prospects and determining

probable requirements

• Relating company products to each

prospect’s requirements

Scientific Selling Process

1. Prospecting and Qualifying

Qualifying the Prospects

Prospect (Lead) Qualifying Criteria Existence of Need for the product Ability to pay Authority to buy Qualified Prospect (Potential or Prospective Customer)

Scientific Selling Process

2. Pre-Approach & Approach

Pre-Approach

Pre-Approach is concerned with spelling out pre-sale objectives and developing a pre-sale presentation plan Product knowledge: Features, Benefits, Styles, Price etc. Company knowledge: History, Management, Policies & Procedures etc. Competitors’ knowledge: Industry structure, Market share, Market behaviour etc. Knowledge about prospect: Buyer needs, Buying style, Personal characteristics etc. It is necessary to develop a sales strategy by collecting customer data and combining them with the product attributes as a fit for satisfying the individual and organisational needs.