marketing exam 2 review

4 strategies to researching a prospect:

1. learn about the company 2. do a background check 3. hypothesize pain points 4. be curious to know more

modified rebuy:

a situation where the customer wishes to modify product specification, change delivery schedules or renegotiate prices.

strategic alliance process buyer:

companies team up to gain mutual competitive advantage.

cost-benefit analysis:

determines the actual cost of the purchase and savings that the buyer can anticipate from the investment.

role influences:

expectation associated with position.

transactional process buyer:

salespeople can eliminate any unnecessary costs or delays.

product buying motive:

~leads the prospect to purchase one product in preference to another ~buyer believes that one product is superior to others ~preference for specific brands, quality, price, design/engineering ~only buying nike and will buy them anywhere

the buying process model is:

helpful in understanding organizational buying decisions and large consumer acquisitions.

prospecting:

identifying potential customers.

prospect:

potential customer that meets the qualification criteria established by your company.

purchase:

salespeople create value by arranging for best financing, supervising the delivery and installation of product.

consultative process buyer:

salespeople focus attention on needs.

steps in the six step presentation process:

~approach ~presentation ~demonstration ~negotiations ~close ~service

reference group:

~categories of people you see yourself belonging to ~buy things associated with that group ~ex: UH student buys clothes with the UH logo

price strategy drawback:

~excessive focus on low price and generous discounts ~high emotional involvement with brand ~low involvement buyers focus on price ~role of price quality relationship on sale ~many buyers, particularly B2B, rank service above absolute price

total product concept:

~generic product ~expected product ~value-added product ~potential product ~example is education at UH

maslow's hierarchy of needs:

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

customer strategy model:

basic need and group influences affect the formulation of customer perceptions and buying motives- emotional vs rational and product vs patronage- that affect buying decisions.

customer strategy:

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

resolution of problems:

customer has evaluated one or more solutions, but issues or concerns must be resolved before customer will make the purchase.

product selling model:

due to today's better educated and more demanding customers, a successful product strategy should include a cluster of satisfactions that meet the needs of these customers. ~today's product: meets and exceeds expectations, better quality, larger selection and new product improvements. ~today's sales person: acts as a partner, is more courteous and trustworthy, more knowledgeable, more understanding of customers and provides service after the sale. ~today's company: acts as a team to provide delivery and installation, orientation and training, quick response times, credit options and customer service.

return on investment:

financial reason to buy the product or service, more in B2B selling, developing a sales proposal that contains specific information on return investment gets a favorable response from key decision makers, must collect detailed financial information to create a customized solution for the customer.

how to effectively build rapport and meet a prospect:

first impressions and introductions.

needs awareness:

first stage, buyer recognizes that something is imperfect or incomplete and the salesperson can create value if they help determine the magnitude of the buyer's problem and identify the solution.

new task buy:

first time purchase of a service or a product.

cultural:

group with common language, environment and subcultures.

prospect base:

made up of current customers and potential customers.

specific benefit:

meets a specific need expressed by the buyer and are more effective in large/complex sales.

group influences:

people around us influence our buying decisions. these are: ~role influences ~reference groups ~social class ~culture and subculture

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 played by david spade)- talked about ONLY features but you cannot sell on features alone ~tommy(heavy guy played by chris farley)- talked about ONLY benefits but you cannot sell on benefits alone ~tommy lit car on fire- talked bad about the competition but you can NEVER rely on badmouthing competition to effectively sell your product

implementation:

repeat sales occur after value creation in timely delivery, superior installation, accurate invoicing, and follow up contacts the continuation of relationship with the buyer.

evaluation of solutions:

salespeople add value in this stage by providing useful information to the buyer to make an informed choice.

general benefit:

shows how a feature can be helpful to a buyer, but does not relate to a specific need expressed by the buyer.

girard's ferris wheel- how to prospect:

shows the relationship between prospecting and loss of customers due to attrition.

cold calling:

simply calling prospects without referrals.

the four kinds of questions:

situation, problem, implication, and need payoff.

product life cycle:

stages of a product from the time it is first introduced to the market, including the stages of: ~introduction ~growth ~maturity ~decline

product development:

the original idea for a product or service is tested, modified, and retested several times before it is offered to the customer.

maintenance and service contracts:

~add value to the sale and protect your business from competition ~can extend the life of the product ~customized service agreements that incorporate the customer's special priorities, feelings, and needs

product selling model and how it relates:

~all are intertwined ~must be knowledgeable to achieve product differentiation, to understand the competition, and create value proposition

buying motives:

~an aroused need drive or desire that stimulates behavior to satisfy the aroused need ~helpful to discover the dominant buying motive

rational buying motive:

~appeals to the prospect's reason or judgement based on objective thought processes ~profit potential, quality of service and availability of technical assistance ~relatively free of emotion ~sales people gather, interpret and disseminate customer-specific information

the "need behind the need" - dr. analogy:

~ask questions to assess the situation and gain full understanding of what is important. ~know their issues ~probe for understanding ~allows for accurate assessment to suggest correct products and solutions

generic product:

~basic, substantive product you are selling ~ex: higher education

variety seeking buyer:

~brand loyal ~low customer involvement ~important perceived brand differences ~ex: chips, ice cream, and soda

habitual buyers:

~buy all the time and don't care about the brand or low cost items ~consumer involvement in purchase is low ~ex: shampoo and laundry detergent

organizational or business buyer behavior:

~buy goods and services for use in the production of other production of other products and services that are sold, rented or supplied to others, not for personal consumption ~decisions made by many, made to meet precise technical specs ~purchase is rational ~decision may be slow and complex

explosion of product options and product configuration software:

~buyers now have many choices, BUT more choices make the consumers buying process more complicated for them. ~product configuration is the product selection process. if the customers have complex buying needs, then the sales person may have to bring together different parts of the company's product mix in order to develop a custom fitted solution. ~the software helps develop customized product solutions quickly and accurately, incorporates customer selection criteria, identifies options/pricing/delivery schedules, and can integrate with customer relationship management applications. ~the example given in class was nissan's build your vehicle.

consumer buyer behavior:

~buying behavior of individuals and households who buy goods and services for personal consumption ~decisions made by one ~purchase based on brand reputation, personal recommendation, on emotion ~may have little product behavior

how do you provide value to customers through spin:

~by diagnosing what they want to purchase and why. ~asking the proper questions builds perceived value. ~understanding the real need allows salespeople to provide the right solution.

patronage buying motive:

~cause the prospect to buy products from one particular business ~past experience was positive ~relevant elements: superior service, product selection, competent sales staff ~ex: only going to academy to buy nike

expected product:

~customer's perceptions, everything that represents the customer's minimal expectations ~ex: good teachers, parking, classroom, place to study

feature:

~data, facts or characteristic of your product/service ~relate to craftsmanship, design, durability, and economy of operation ~reveal how the product was developed, processed or manufactured

positioning:

~decisions and activities intended to create and maintain a certain concept of the firm's product in the customer's mind ~companies shape who they are to you

quantifying the solution:

~determining whether or not the proposal adds value ~done through cost benefit analysis and calculate the return on investment (ROI) ~important in situations where the purchase represents a major buying decision

selling new products:

~develop new expectations ~change habits ~establish new standards ~build product desire ~create new markets

price strategy kinds and benefits:

~each stage of the life cycle ~setting prices can be a complex process ~some firms set prices to maximize profits (porsche) ~others set a market share objective (walmart) ~pricing strategies reflect a product's position in the marketplace

selling mature products:

~emphasize brand superiority ~emphasize company superiority ~point out unique features ~provide quality customer service ~sustain existing market share

attrition:

~every salesperson must cope with customer attrition ~customer may have a one time need ~customer may move outside of the salesperson's territory ~firm may go out of business or merge ~loyal buyer or purchasing agent may leave the position ~sales may be lost to the competition

sales project company representatives and company information:

~gemma mccloskey: manager, talent acquisition ~edward kenna: director, inside sales ~mo mirpuri, zach callender, brooks terry: account executive ~megan butler: account manager ~will sharry: senior account executive •raptor technologies is a "software as a service" (saas) provider of safety and security software for both k-12 schools and corporations to keep children safe •founded in 2002; protects over 32,000 k-12 schools across the u.s. •corporate headquarters are in houston, texas with a satellite office in raleigh, north carolina •has 123 employees nationwide with plans to add 30+ jobs in 2020

situation questions:

~general data gathering designed to help you find out basic information ~gather as much information on business before sales call ~translate what you know into getting more detailed information ~ex: i know ______ , can you tell me more about _____ ?

social class:

~group with similar values, interests, or lifestyles who we identify with in a large sector socially ~ex: age group, religion, LGBT

types of consumer buyers:

~habitual ~variety-seeking ~complex buying

problem questions:

~help assess the needs or problems your client/prospect might have ~provide the necessary answers to how you can be the solution ~ex: what are your current challenges with your current situation?

complex buyer:

~high degree of involvement from consumer ~product is expensive ~purchase infrequently ~highly self expressive ~ex: house or car

performance data and specification:

~important when customer compares the merits of one product to another ~knowing everything about how the product or service works

value proposition:

~is the set of benefits and values the company or salesperson promises to deliver to customers to satisfy their needs ~a well informed customer will usually choose the product that offers the most value ~ex: porsche promises high quality, luxury, and performance

price strategy objectives:

~maximize profit ~maximize market share ~maximize product trial

quality control:

~measuring product and services against established standards ~has important sales appeal when used by the sales person to convince a prospect of a product's quality

know the competition:

~must acquire facts about competing products before sales presentation ~be able to discuss your strengths and weaknesses relative to the competition ~do not refer to competition directly during sales presentation ~only discuss competition if you know your facts ~never criticize the competition ~be prepared to add value

potential product:

~mutually discovered possibilities, salesperson should conceptualize the product into new possibilities ~refers to what may remain to be done, what is possible ~ex: UH is tier 1 making your degree worth more

steps in the buying process model:

~needs awareness ~evaluation of solutions ~resolution of problems ~purchase ~implementation

steps in the consultative sales process:

~needs discovery ~product selection ~need satisfaction ~service

product positioning options:

~new or mature ~based on price ~based on value-added

types of organizational buyers:

~new task buyers ~straight rebuy ~modified rebuy

emotional buying motive:

~one that prompts the prospect to act because of an appeal to some sentiment or passion ~emotional appeal is common ~if 2 products are identical, the sales person who connects has the advantage

walmart positioning and differentiation:

~positioning- low cost, their main market is family ~differentiation- save money, live better

target positioning and differentiation:

~positioning- quality, first to bring luxury to mainstream ~differentiation-expect more, pay less

coca cola positioning and differentiation:

~positioning- universal ~differentiation-open happiness

pepsi positioning and differentiation:

~positioning- uses pop culture icon to promote product ~differentiation- try something new

parts to becoming a product expert:

~product development and quality improvement processes ~performance data and specification ~maintenance and service contracts ~price and delivery

sources of product information:

~product literature, catalogs, and web based sources developed by the company for sales support information ~sales training programs ~plant tours- seeing production process first hand ~internal sales and sales support team members ~customers-people who use the product, create testimonials ~use the product ~read and study publications

factors determining product life cycle:

~product's perceived advantage over available substitutes ~product's benefits and the importance of the needs it fulfills ~competitive activity including pricing, development of substitutes, and promotional effectiveness ~changes in technology, fashion or demographics

why setting an agenda is important:

~propose an agenda ~make sure the customer understands the value of the agenda and get the customers input and acceptance before moving on ~what is it that you would like to focus on?

need payoff questions:

~questions that gain the commitment to move the selling process forward ~summarize the needs agreed upon by the client and ask for commitment to work together toward solution ~buyer responding negatively means the salesperson has not identified a serious need

reasons people get on "ferris wheel" or ways to collect prospects:

~referrals ~centers of influence ~directories ~trade publications/shows ~telemarketing ~direct mail ~email and ads ~web sites and computerized databases ~cold calling ~networking

reasons people get off the "ferris wheel":

~relationship between customer and salesperson deteriorates ~business failure ~buyer buys from another source ~acquisitions and mergers ~customer moves ~death of a customer ~customer only has a one time or extended need for product ~customer needs change because of new technology

straight rebuy:

~routine purchase of items needed by a B2B customer as long as the supplier meets criteria for price, quality service and delivery ~automatically know what they want

value-added product:

~sales person's knowledge, exists when sales people offer customer more than they expect ~ex: what UH knows they can provide, getting into games for free, the UC, the rec center

boiler room video:

~seller's name is ron ~how to sell on a telemarketing call ~"it's not what i want, it's what you want"

video clip: seinfeld and the new jacket- what did it mean to jerry and the relevance of george?

~social needs and the roles we play have an influence on what we buy ~jerry: social need of jacket, confidence boost, feels successful in jacket ~george: expresses like of the jacket and has influence over jerry

buying process:

~systematic series or a series of defined repeatable steps, intended to achieve a result ~need to be clear on how decisions are being made ~acquire specific information about buyer's decision making process

the purpose of asking the spin questions:

~to create a customized proposal ~once the main needs are identified, ask the client to prioritize ~match features and benefits of the company/service/product that best meets the needs ~custom approach to selling based on individual situation. ~to find the need beyond then need

bridge statements:

~transitional phrase that connects a statement of features with a statement of benefits ~connect features of products to benefits they receive ~use the word "because"

implication questions:

~used to help the prospect to see how your business, service, or product is the solution to their problem ~questions take the need further and have the prospect think about the ramifications of the situation ~conducted only after need is identified, pain or gain ~help the buyer realize the costs of doing nothing outweigh the cost of the solution

industry expert:

~way to address and know competition ~become a business analyst versus just being a product specialist ~current and detailed knowledge ~requires education, reading trade journals, industry seminars and conventions, and joining professional associations for that specific field.

benefit:

~whatever provides the customer with a personal advantage or gain ~"how will i benefit from owning or using the product" ~can be general or specific

buyer resolution theory (5 w's theory):

~why should i buy? ~what should i buy? ~where should i buy? ~what is a fair price? ~when should i buy?

differentation:

~your ability to separate yourself and your product from that of your competitors ~how companies compete

product strategy:

a well-conceived plan that emphasizes becoming a product expert, selling specific benefits, and configuring value-added solutions.