MARK 3337 Exam 2

*Positioning*

*Decisions and activities intended to create and maintain a certain concept of the product in the customer's mind* - Walmart: low cost, main market is family, variety - Target: quality, first to bring luxury to mainstream - Coca Cola: everyone - Pepsi: uses pop culture icons to promote product

Quantifying the solution

*Determines whether or not the proposal adds value* - Calculate cost-benefit analysis and return on investment (ROI) - Important in situations where the purchase represents a major buying decision

Total Product Concept

*Example is education at UH* 1. *Generic product* - what you are selling - Higher education 2. *Expected product* -customer's expectations - Good teachers, parking, classroom, place to study 3. *Value-added product* -sale's person knowledge, exists when sales people offer customer more than they expect - Getting into games for free, the UC, Rec center 4. *Potential product* - mutually discovered possibilities, salesperson should conceptualize the product into new possibilities (refers to what may remain to be done, and what is possible) - UH is tier 1, making your degree is worth more

*Price Strategy*

*Maximizing profit, market share, and product trial* *Kinds and Benefits* - Pricing strategies = position in the marketplace *Drawbacks* - High emotional involvement with brand - Low involvement buyers focus on price - Many buyers, particularly B2B, rank service above absolute price

Selling New vs. Mature Products

*New Product:* develop new products, expectations, standards, markets, and change habits *Mature Product:* emphasize brand and company superiority, point out unique features, provide quality customer service, and sustain existing market share

Ways to Collect and Organize Prospect Information???

*Portfolio model:* uses forecasted sales competitive position to classify how much sales effort should be made on individual accounts in database *Sales process model:* classifies prospects based on where they are in the sales process - Represents the total set of accounts being pursued at any given time

*Tommy Boy Video Clip* - What did Richard (little guy) and Tommy (big guy) represent about selling the product?

*Purpose: You have to know your product FEATURES and BENEFITS to sell.* *Richard* (skinny guy) - Talked about ONLY features. You can't sell on features alone *Tommy* (heavy guy) - Talked about ONLY benefits. You can't sell on benefits alone. - Talked bad about the competition. Badmouthing competition is not effective for selling your product

*Organizational Buyers*

*Refers to the buying behavior for use in the production of other products/services* - Decisions made by many - Meet precise technical specs - Purchase is rational, slow, and complex 1. *New task buys:* first time purchase of a service or product 2. *Straight rebuys:* routine purchase of items by a *B2B* customer as long as the supplier meets criteria for price, quality, service, and delivery, automatically know what they want. 3. *Modified rebuys:* a situation where the customer wishes to modify product specification, change delivery schedules, or renegotiate prices.

*Consumer Buyers*

*Refers to the buying behavior of individuals and households.* - Decisions made by one - Purchase based on brand reputation, personal recommendation, and emotion 1. *Habitual:* buy (low cost) all the time and don't care about brand. 2. *Variety-seeking:* brand loyal and low customer involvement 3. *Complex buying:* high customer involvement, product is expensive, purchase infrequently (ex: house or car)

*Differentiation*

*The ability to separate the product from that of the competition in a way that builds a competitive advantage* - Walmart: save money live better (price) - Target: expect more pay less (value) - Coca Cola: universal - Pepsi: uniqueness

*Value Proposition*

*The set of benefits or values the salesperson configures to meet and exceed customers' specific needs* - Create value by using SWOT Analysis

The 'need behind the need' - Dr. Analogy

- Assess the situation - Understand what is important - Know their issues to accurately match the correct products/solutions

Understanding and Addressing Competition

- Be able to discuss strengths/weaknesses relative to the competition - Do not refer to competition directly during sales presentations - Only discuss competition if you know your facts - Never criticize the competition - Be prepared to add value

Prospecting and Sales Forecast Plans

- Collect sales data and organize into Customer Relationship Management (CRM) Systems - Salesperson should have sales intelligence info and manage the account analysis

What is the purpose of asking questions (SPIN)?

- Create a customized proposal/approach based on individual situation - Discover client needs and prioritize them - Match the features and benefits of the company, service, or product (meet needs)

Parts to Becoming a Product Expert

- Product development and quality improvement processes (training/product knowledge) - Performance data and specs (create differentiation) - Maintenance and service contracts - Price and delivery

*Product Configuration Software*

- Quickly and accurately develops customized product solutions - Incorporates customer selection criteria - Identifies options, pricing, and delivery schedules - Can integrate with CMR applications *In-class Example:* Nissan builds your vehicle

Sources of product information

- Web-based sources, catalogs, and marketing-related sales support information - Plant tours - Internal sales and sale support team members - Using the products - Read and study publications

How to effectively build rapport and meet a prospect????

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*Product Selling Model* (NOT Total Product Concept)

1. *Expected product* - what you believe you desire buying the product (built on customer expectations) 2. *Value-added product* - things you didn't know that comes with the product (salesperson knowledge) 3. *Potential product* - mutually discovered possibilities

Maslow's Needs - How does it relate to sales?

1. *Physiological:* primary /basic needs (food, water, sleep shelter) 2. *Security:* free from danger (gun, health insurance, alarm for home) 3. *Social:* need to belong (clothes we buy, social media) 4. *Esteem:* feel worthy in the eyes of others (college degree) 5. *Self actualization:* self fulfillment, tapping into full potential - Useful for gaining insight into buyer needs

Group Influences

1. *Role Influences:* expectation associated with position 2. *Reference groups:* categories of people you see yourself belonging to buy things associated with that group 3. *Social class:* similar values, interests, lifestyles 4. *Culture and subculture:* group with common language, environment, and subcultures

What are the 4 kinds of questions (SPIN)?

1. *Situation* - ask in order to know and understand the situation 2. *Problem* - questions that address the problems 3. *Implication* - questions that tie into changing behavior 4. *Needs Payoff* - questions in regards to finding solutions through your company

Portfolio Model for Classifying Prospects

1. *Strategic accounts:* necessary; needs to be protected from competition (intensive coverage) - Competitive position: H - Account opportunity: H 2. *Problem accounts:* attractive only if possibility for competitive weakness breakthrough (moderate coverage) - Competitive position: L - Account opportunity: H 3. *Hold accounts:* attractive if current sales can be maintained with minimal effort (not quite enough money, moderate coverage) - Competitive position: H - Account opportunity: L 4. *Drag accounts:* not really worth personal selling; you will be better off if they buy from competitor (moderate coverage) - Competitive position: L - Account opportunity: L

How do you provide value to customer's through SPIN?

1. Ask proper questions (determine what they want and why) 2. Understand the need in order to provide the right solution

Customer Strategy Model

1. Develop Personal Selling Philosophy 2. Develop a Relationship Strategy 3. Develop a Product Strategy 4. Develop a Customer Strategy

4 Strategies to Researching a Prospect

1. Learn about the company 2. Do a background check 3. Hypothesize the pain points 4. Be curious to know more

CRM Sales Funnel Model

1. Prospect 2. Qualified 3. Needs Analysis 4. Presentation 5. Negotiations 6. Closed Service *Balanced funnel:* determines how much sales revenue is needed at each stage to meet sales quotas and projections

*Customer Strategy*

A carefully conceived plan that results in *understanding* the customer's *perceptions* and *maximizing* customer satisfactions and *responsiveness*

*Seinfeld and the new jacket* - What did it mean to Jerry and the relevance of George???

CHAPTER 8

Boiler Room - Telemarketing???

CHAPTER 9

*Cost Benefit Analysis*

Determines the actual cost and savings the buyer can anticipate from the investment

*Product Strategy*

Emphasizes becoming a product expert, selling specific benefits, and configuring value-added solutions

*Features*

Includes data, facts, and characteristics of products or services

*Benefits*

Includes whatever gain is provided to the customer - *Specific:* meets a specific need expressed by the buyer, are more effective in large/complex sales. - *General:* show how a feature can be helpful to a buyer but does not relate to a specific need

Girard's Ferris Wheel - How To Prospect

Shows the relationship between prospecting and loss of customers due to attrition (uncontrollable forces)

*Qualifying Prospects*

The process of identifying prospects who appear to have a need for your product and should be contacted

*Buying Process*

The series of defined repeatable steps intended to achieve a result and understand how decisions are made or specific information acquisition 1. Needs awareness 2. Evaluation of solutions 3. Resolution of problems 4. Purchase 5. Implementation

*Prospect Base*

A list of current and potential customers

Sales Project Company Representative

Rob Trevino - Ecolab

*Bridge Statements*

Statements that connect features to benefits