Exam 2 Professional Selling (Textbook Content)

Time Management Quote

"You can't manage time; you actually only manage what you do during time.So the management issue is not so much about time, it's more about how do you manage your focus, how do you manage your actions and your activities in terms of what you do."

What is the key to time management for busy salespeople?

"work smarter and not harder"

For best results, goals should be established in each of the three areas:

1. Activity/Behavioral Goals - Things the salesperson does on a daily basis 2. Conversion Rate Goals - ....if done regularly and efficiently will lead too... 3. Outcome or Results Goals - outcome/results the salesperson is seeking

Common Steps in Gaining Commitment

1. Develop goals for each meeting with the prospect: Setting goals during the selling process is a step towards gaining commitment. It is important that the goals share the same overall objective to achieve the result. Each goal will be different based on the stage of the discussion with the prospect. The goals will continue to be refined as they become more focused on the needs of the prospect. Knowing how to build the relationship with the client in the early stages is paramount to continue the collaboration. 2. Confirm and summarize each discussion: This process confirms that you have been listening and understand their real needs as the prospect has been describing them. In addition to gaining commitment, it builds your credibility, strengthens the relationship, and displays your knowledge. 3. Discuss options and solutions: As buyers begin to see value, the salesperson must discuss how the solution will benefit their organization. Buyers recognize the potential risk of their decision and will consider previous objections if the value of those solutions do not outweigh the cost of change. 4. Define the value of the commitment: At this stage, the customer must realize the value of the relationship and the associated benefits for his organization. The solutions presented and agreed upon by the client and the salesperson will continue to advance the process towards gaining full commitment. The commitment to the relationship is predominantly determined by a level a trust that the client develops during the sales process. Other factors that may contribute to the commitment include service, quality, reliability, and the commitment by the seller to further advance the value.

Essential Selling Skills for Sales and Further Development

1. Excellent communication. 2. Active listening. 3. Problem-solving. 4. Passion. 5. Competitive. 6. Resilient. 7. Empathy. 8. Time management. 9. Integrity 10. Confidence.

The ___________ rule, also known as the ________ _________, when applied to sales careers asserts that the top 20% of salespeople will earn 80% of the money and be the most successful. In sales, the same _________ rule is applicable toward identify activities that are potentially the most productive and make them the priority. Once salespeople identify these critical factors, they will be focused for success in their career.

80-20, Pareto Principle, 80-20

*Career development needs is

A lifelong process

A Study of Goal Setting Processes

A study by Dr. Gail Matthews of Dominican University in California summarizes the importance of a more formal, rigorous, and planful goal-setting process. Dr. Matthew's tested several different methods of goal setting. Her study revealed that people with written goals would realize a 42% increase in mean goal achievement versus people without written goals. Further, she discovered that people who shared their written goals with an accountability partner and provided regular progress updates to that accountability partner realized another 25% increase in mean goal achievement versus people with written goals compared to those that didn't share them with an accountability partner. The results of this study clearly illustrate the importance of writing goals down and having an accountability partner. In the professional selling arena, salespeople will likely spend a substantial amount of time establishing and revising their goals and an even larger amount of time in regular discussions with an accountability partner, usually their sales manager.

SMART Goal Setting Guideline

A widely accepted guideline for setting goals is the "SMART" goal setting rule. SMART is an acronym for: S—Goals should be specific. M—Goals should be measurable. A—Goals should be achievable. R—Goals should be realistic. T—Goals should be timely or time sensitive. Following are examples of SMART goals: Grow the ABC account by 12% during the next quarter by increasing their purchases by 8% at an average 4% price increase. Expand my territory by adding at least six new accounts this month. Improve my sales closure rate from 50% to 65% by improving my ability to handle objections. Following are examples of non-SMART goals: Grow my territory. Get better at selling skills. Improve my product knowledge. Find a mentor that can help me develop professionally. In the first set of examples, with the SMART goals in place, the accountability discussion is extraordinarily productive. In the second set of examples, with the non-SMART goals in place, the accountability discussion is vague and imprecise, potentially leading to poor performance or inaccurate performance assessment.

*A position in sales has many freedoms with how the salesperson plans their time. It is important that they

All of the above Develop a daily list of activities the day before Have written goals Define their daily priorities

*A career development need of every salesperson is

All of the above Develop credibility with everyone Practice the "Golden Rule" Time management Setting priorities and goals

The Goal Accountability Process

As a guideline for accountability, a very simple process is recommended. This process minimizes paperwork and bad feelings. The following list of questions should be discussed and agreed between the salesperson and their manager on a regular basis. What were the goals (activities, conversions, outcomes, other) for the previous period? What were the outcomes versus the goals? How do we feel about this? What could/should we have done differently? What is the goal for the next period? What actions are indicated going forward? When will we meet again?

*If you are a new salesperson, how would you establish sales call productivity assumptions?

Ask a seasoned veteran

*What is the best way to allocate sales calls across a territory?

By customer potential and competitive position

*Delivery, tone, and emphasis are related to which skill?

Communication

*Which skill is related to demonstrating integrity, building trust and security to a prospect or client?

Confidence

Emotional Intelligence (EQ)

Emotional intelligence also referred to as EQ, is the ability to express and control emotions and be aware of the impact on others. It is a critical element when creating and developing relations with prospects and customers. IQ and EQ exist in tandem and are most effective when they build off one another. Many sales organizations seek salespersons with strong emotional intelligence knowing they accept criticism, manage conflict, and are emotionally balanced in social situations. EQ enables salespeople to recognize the cues from others and respond or adapt appropriately.

*One of the BEST resources for career development is

Follow the practices of the top successful salespeople

Importance of a Growth Mindset

For a salesperson, a growth mindset establishes a mental state that encourages the salesperson to counter negative thoughts with a vision of success and the ability to develop the skills for success. A few examples of this that relates to selling include: I can learn and develop the skills for sales. Rejection is not a "no" only if I stop trying. Challenges only improve my tenacity to sell and make me smarter. Selling is a dynamic process and improves my skills. I welcome feedback and criticism. I will try until I achieve my sales goals. In summary, a salesperson with a fixed mindset believes that their abilities are fixed and are less likely to succeed by developing the necessary sales skills. This is the opposite of a salesperson with a growth mindset who believe that everything is possible. The following video Developing a Growth Mindset by Professor Carol Dweck provides the Growth Mindset strategies to overcome a fixed mindset.

Goal Areas for Salespeople

For our purposes, we will discuss two types of sales management systems and their impact on goalsetting. Outcome or results-based sales management systems focus on the results generated by the sales organization. In outcome-based systems, goals are typically written in terms of outcomes such as sales volume, numbers of customers or accounts, sales growth or other major results areas. Conversely, behavior or activity-based sales management's systems focus on the activities performed regularly by the salespeople. An activity-based systems, goals are typically written to describe the regular activities of a salesperson such as number of prospecting calls made, number of sales appointments completed, number of new customers added, number of referrals generated, and so on. Many sales organizations use a combination of outcome-based sales management systems and activity-based sales management systems.

The Goal Setting Process

Goals should be written. The process of writing them out creates clarity in the mind of the goal setter. Clarity provides focus and focus tends to increase productivity. Writing out goals also allows the goal setter to refer to the goals periodically that should improve longer-term performance against the goal. Written goals can be exchanged with an accountability partner. In a professional selling context, goals will likely be written out in a fair amount of detail, published within the sales organization, monitored regularly for performance versus the goals, and discussed between the salesperson and their manager on a regular schedule. In most selling organizations, performance versus goals is one of the primary measures of salesperson success and a key determinant in recognition programs, incentives or promotional decisions.

*Assume that the sales process requires two appointments to close the sale. In the first appointment, the salesperson builds rapport and completes a needs analysis. In the second sales appointment, the salesperson presents a recommendation, handles objections, and asks for a commitment. After tracking their numbers for 3 months, the salesperson discovers that they converted 20% of their prospecting calls into appointments, converted 60% of their first appointments into second appointments, and converted 70% of their second appointments into closed sales. Based on these conversion rates, which skill needs the most development for the salesperson?

Improving their prospecting phone script

Common Sales Career Positions

Job titles in sales include entry-level customer service representatives, executive vice presidents, and hundreds of jobs in between. A sales job is any job that requires you to sell a product, service, or idea. Since this category is broad, your duties will depend on what you are selling, to whom you are selling, and whether yours is an entry-level, coordinating, or management position. Some companies may use different job titles to refer to similar positions since there is not necessarily a standardized system for naming sales positions. Sales Representative or Account Representative are a common entry-level position in consumer sales (B2C) or B2B sales roles. The primary goal of these positions is to sell the company's products or services. If you are successful as a sales representative, you can advance quickly to a leadership position with more responsibility and a higher compensation. Management positions supervise other sales employees, existing customer accounts, or develop strategies for the sales department. At the executive level, it will matter less which industry you have entered. You will be dealing mostly with organizational issues and interpersonal matters that remain roughly the same no matter what the company is selling.

*How large should a territory be?

Large enough to contain sufficient market potential

*Creating a career development plan will

Lead to success Increase chances for more opportunities c and d (correct)

*There is a time to talk and a time to . . .

Listen

"Confidence is the currency of sales."

Lydia Vargo

Conversion Rate Goals

Metrics that reflect the efficiency with which the salesperson's activities convert into outcomes or results. These conversion rates vary based on the state of the market, the nature of the product, the relationship with the customers, and the skills of the salesperson. Measuring and tracking conversion rates, and setting goals for improving them, gives the salesperson insight into areas for improvement. Extremely low or high conversion rates may be a function of noncontrollable factors such as the supply-demand balance in a market or the importance of the product to customers. Outside of these uncontrollable factors, the salesperson's skills can also have a major impact on conversion rates Examples of conversion rate goals would include Number of leads generated per name in my database. Number of qualified prospects per lead. Number of face-to-face appointments generated per prospecting phone call. Number of transactions per sales call. Number of transactions per new customer. Number of repeat purchases per existing customer. Average revenue per transaction. Average revenue per existing customer. Profit margin per transaction.

*Which of the following is an activity or behavioral goal?

Number of prequalification phone calls made to prospects

*Which of the following is an activity or behavioral number?

Number of prequalification phone calls made to prospects

*Which of the following is a conversion rate goal?

Number of sales per appointment

*Which of the following is a conversion rate number?

Number of sales per appointment

____________ or ________ _______ goals are the most commonly discussed goals for salespeople. Frequently, these goals originate at the Senior Executive level of the firm and are stated in terms of annual or quarterly revenue growth for the firm. These "top-down" goals are then distributed to the Sales Managers who in turn allocate them to the salespeople, frequently referred to as quotas.

Outcome or results-based Examples of outcome or results goals include Annual, quarterly, or monthly revenues. Annual, quarterly, or monthly revenue growth. Total revenue by product group. Total revenue in targeted geographic areas. Profit margin. Profit margin improvement. Total number of new customers served. Overall customer retention rate.

The Most Common Objections

Price and Budget Objections: Often used as a negotiating tactic by the buyer, price aside, purchasing agents are most likely to use this tactic to test the salesperson and take the first step toward negotiating. The price objection is more common in business-to-business (B2B) to get a discount. *In many purchasing decisions, price may be presented as the objection, but the buyer's real reason is their budget. Budget issues do exist, it is important to qualify the prospect's deeper concern about how/when buying decisions are made by the buyer. Product Objection: Concern voiced by the prospect relating to the salesperson's organization or product offering. The buyer is simply concerned about your product being as good as the current supplier's product. This involves a risk on the part of the buyer to make a change. *This objection usually comes up when a prospect does not fully understand the implementation process of a new product or how the seller's product could benefit their organization. Satisfied with the Existing Supplier: A buyer's objection that they are satisfied with the existing vendor can be more challenging than a price objection. This objection is easy-it is not an explicit statement about the price or product. The true objection is hidden from the seller. A change involves time and risk. The buyer uses this as a more generic objection to deter a decision and avoid specifics for their true reasons. *This also involves a trust factor, which becomes a larger obstacle than price and it will take time for the salesperson to build a similar trust relationship, even with a better product/ price. I Need to Think About It: Not a true objection. This statement is simply a stall tactic by the buyer. Similar to the "I am satisfied with my existing supplier," the buyer may be masking their fear of change.

Professional and Personal Development Goals

Professional development in areas such as communication, use of technology, leadership, teamwork, and other "soft skills" will assist the salesperson in their daily tasks. Personal development in areas such as managing health, dealing with stress, having a healthy mindset, and minimizing distractions will also lead to increased productivity. Listening to positive messaging from podcasts or reading that broadens the general knowledge base of a salesperson will increase the salesperson's ability to interact favorably with customers as well as associates. These goal areas should not be ignored.

*Which of the following is a SMART professional development goal?

Read two John Maxwell Leadership books by the end of the year

Sales is a stepping stone

Sales is often a great steppingstone for many other careers. In sales, a person will develop and master skills they can use to thrive in any area of a professional life. These skills that are highly transferable and applicable to many roles in the future. Sales is a soft skill and include a combination of people skills, social skills, communication skills, character or personality traits, attitudes, career attributes, social intelligence, and emotional intelligence quotients that enable people to navigate their environment, work well with others, perform well, and achieve their goals. Strengthening these skills is one of the best investments a salesperson can make for their career development. More than half of senior leaders today say soft skills are more important than hard skills.

Establishing Territories

Step 1: Determine the appropriate territory alignment methodology. This determination is dependent upon the product offering, the dispersion of customers, the sales potential of the group of customers, and the preferences of the sales manager or salesperson. Step 2: Estimate the market potential in the territory. Step 3: Determine the workload for the salesperson. Step 4: Review the territory decisions with the salesperson.

Steps in Handling Objections

Step 1: Listening - As the prospect discloses their objections, listen to understand, do not respond immediately. Avoid interrupting and give the buyer time to voice their concerns and objections. Step 2: Understanding - Confirm and validate the true nature of the objection (may involve repeating the prospect's statement of concern). Demonstrates that you have listened and understand their objection to the potential sale. Ask follow-up questions OPEN ENDED if needed. Step 3: Responding - The proper response is to show empathy toward the prospect's concern. Empathy is central to every successful sales effort. It demonstrates that you have their needs and interests in mind and not simply trying to make a sale. An emotional connection builds trust for a strong relationship and it is the reason that empathetic salespeople earn more business. Step 4: Providing a Solution - Once the objection is fully clarified, the focus will be on the solution to resolve the objection. In most cases, there will be several potential solutions to be considered. The salesperson can demonstrate their competency and value by taking the lead here and striving to help the prospect solve their pain points with your product and/or service. Involve the customer in discussing the pros and cons of each solution and the process to execute each solution. Answer all the questions of the buyer to establish the comfort level needed to finalize the sale.

Managing a Territory

Step 1: Start with a global view of the territory. List all potential customers in the territory. Begin by dividing them into two groups, existing accounts and new accounts. It may be helpful to place them on a map to get a visual assessment of their geographic dispersion. Step 2: Estimate sales potential by individual customer. On a customer-by-customer basis, make an assessment of the total sales available at each customer location. It may be helpful to enter this data into a spreadsheet so that some sensitivity analysis can be performed for varying sets of assumptions. Step 3: Prioritize the customers according to their potential. Some salespeople use a simple "ABC" system of prioritization, wherein they rank customers from largest potential to smallest potential. Not the best way to manage a territory as it does not account for the salesperson's competitive position. A better way is to create a 2 × 2 Territory and Account Management Matrix. Step 4: Establish sales call productivity assumptions. Using historic experience or drawing from the experience of a seasoned sales veteran, establish conversion rates in terms of number of calls required for successful sale in each of the four groups shown in the matrix earlier. Step 5: Allocate resources across the territory. At this point, the salesperson needs to determine their capacity to make sales calls, allowing for travel time and other complexities. Additionally, the salesperson needs to make assumptions about the number of productive sales days they can spend with customers over time. Step 6: Create the territory management plan. Viewing the entire territory, and searching for efficiencies in travel time, preparation time, and so on, the salesperson is now ready to create a plan for visiting each individual account.

*Which of the following items does a salesperson have the most control over?

The number of prospecting phone calls they make

*The critical elements that should NOT be considered in gaining commitment from the prospect includes

The salesperson's availability

Why consider a career in sales?

There is no other department or business function that has a greater impact on the development of the all-important cash flow than the sales department. If you're an effective seller with a proven track record for bringing in business and building relationships, you have significant market value. Despite new technologies, tools, and business models, the skills and competencies of sales professionals will always be crucial for building relationships, closing deals, and finding new opportunities. If a business is struggling, successful salespeople are usually the last to be cut because cutting sales means cutting the channel that drives revenue.

Gaining Commitment

This begins with the commitment from both the buyer and seller to work together on a transaction. This concept of gaining commitment clearly illustrates the concept of consultative selling where the relationships begin with a single transaction and are then developed over time.

*Which of the following is an outcome or results number?

Total revenue this quarter

Effective Time Management Tactics for Salespeople

Track progress toward sales goals Plan prospecting time around customers Organize appointments together by location Focus on one thing at a time Eliminate nonessential tasks Avoid distractions Do not procrastinate Give yourself a break Qualify prospects within your target market Embrace technology and available easy to use tools

Outcome or Results Based systems (GOALS)

Typically written in terms of outcomes such as sales volume, numbers of customers or accounts, sales growth or other major results areas. Examples of outcome or results goals include Annual, quarterly, or monthly revenues. Annual, quarterly, or monthly revenue growth. Total revenue by product group. Total revenue in targeted geographic areas. Profit margin. Profit margin improvement. Total number of new customers served. Overall customer retention rate.

*Which of the following is an outcome or results goal?

Units sold this quarter

Goal Setting

Virtually, every functional area in the organization derive their plans and their success based upon their ability to fulfill the needs of the organization based upon the achievement of the sales goals. Understanding the wide-ranging impact that goal setting and goal attainment have upon an organization is of paramount importance to salespeople and sales managers.

*How often does a territory management plan need revised?

When conditions change

Behavior or Activity-Based sales systems (GOALS)

Written to describe the regular activities of a salesperson such as number of prospecting calls made, number of sales appointments completed, number of new customers added, number of referrals generated, and so on. Examples of activity-based goals would include Number of names in a prospecting database. Number of prospecting phone calls needed. Number of face-to-face calls needed with new customers. Number of face-to-face calls needed with existing customers. Number of revenue productive days spent with customers.

"Your attitude, not your aptitude, will determine your altitude."

Zig Ziglar

*Which time management tactics are best related to sales success?

all of the above Eliminating nonessential tasks Avoiding procrastination Focusing on one item at a time Prospecting time around customers

*What describes a "growth mindset?"

all of the above Rejection is not a "no" Challenges improve tenacity Feedback and criticism is welcomed Always trying to achieve sales goals

*Emotional Intelligence provides

all of the above Ways to communicate effectively Empathize with others Overcome challenges Defuse conflicts

*A good time management methodology on the part of a salesperson

all of the above Will increase selling time Reduce stress and increase confidence Improve productivity

*During the stages of gaining commitment, the salesperson must be

all of the above assertive, patient, trustworthy

*Many objections on the part of the buyer simply indicates that they need ________.

all of the above more time, more info, a solution to a porblem

Successful people carry themselves with two qualities: ____________ and ____________.

confidence and conviction

Alternatively, territories can be established by ______________ _____ such as department stores versus grocery stores or original equipment manufacturers versus distribution facilities.

customer type

*Good sales skills are . . .

developed over time improved with practice

*All Customer Relationship Management (CRM) systems are expensive and have value for only the high performers.

false

*Confirming and summarizing the discussions between the sales and client is not a necessary step.

false

*Contacting all available leads is critical toward increasing sales because sales is a "numbers game."

false

*Empathy is more concerned with understanding how a person feels and has little importance in sales

false

*For most sales personnel, career development is only a short-term need at the beginning of their career.

false

*Gaining commitment is the final step of closing.

false

*Good time management is basically developing a good "to-do-list."

false

*Objections are rarely an issue if the price is lower than the current supplier.

false

*Options for the solutions to the client's problems should only represent the salesperson's perspective.

false

*Sales should expedite the pace of gaining commitment.

false

*The buyer's response "I'll think about it" is always a no in disguise.

false

*The career development needs for a salesperson in consumer sales is no different than a career in selling to other businesses.

false

*The goals of the gameplan should never be flexible if gaining commitment is well planned.

false

*The handling of an objection has several common parts that include listening, understanding, price, and solution.

false

*The process of gaining commitment comes naturally to every salesperson.

false

*The use of persuasion is always more effective in sales to secure an order.

false

*Tracking progress toward sales goals is not as important as prospecting.

false

The most popular method of establishing territories is by ________________.

geography Territories can be established by region, state, county, statistical metropolitan area, zip code, or any combination thereof. Some consumer goods companies establish territories by both product line and geography. For example, a consumer goods salesperson's territory might be the northern half of a state but only department stores or only for a portion of the consumer goods company's product line.

Another methodology would be to establish territories by ______ _________. This is particularly effective when a large account has offices across geographic areas. In this situation, there may be a national accounts manager responsible for coordinating the overall sales effort of the account.

key account

Two major parts of the selling process that make it a success:

mental element and selling technique Technique is applying the right solutions in the right place at the right time. Salespeople fail if their mental focus is weak and/or their technique is poor.

A salesperson's _______ _______ is critical in the selling process.

mental state The salesperson must be willing to be patient in building a relationship with the prospect. The price objection is prominent in most salespeople's mindset before they begin the selling process. Price and other possible objections linger in the mind of many sales personnel before and during the sales presentation. This doubt can often diminish the enthusiasm that a salesperson shows for their product or service and cause the potential sale to fail. A prospect can sense the salesperson's lack of confidence. The salesperson who shows the least amount of doubt will be the most powerful.

To successfully obtain commitment and further the sales cycle, the salesperson must be _________ and maintain a __________ __________.

patient, positive attitude

*Who typically establishes territories?

sales managers

*Objections on the part of the client are possible if the prospect does not see

solutions to their pain and value

*The mental state of the salesperson and their _____________ are the two major parts of the selling process.

technique

*A "growth mindset" is a positive mental state that influences how you think.

true

*Career development for a salesperson starts with a commitment to improve the skills necessary to succeed.

true

*Emotional Intelligence (EQ) for a salesperson is often more important than their IQ.

true

*Increasing available selling time is the number one priority for sales.

true

*Listening to the prospect's objection is the first part of the seller's response.

true

*Objections are frequently driven by the buyer's concern for risk.

true

*Poor time management is often the primary pitfall of new sales personnel.

true

*Since sales is all about face-to-face meetings with clients, sales tactics are not important

true

*The key to a career in sales starts with assessing what you are passionate about.

true

*The pricing objection can be a deterrent to gaining commitment.

true

*The pricing objection is sometimes a budget issue to the buyer.

true

The building of ____________ and the formation of a _______________ between the salesperson and the prospect is critical to the final process of gaining commitment.

trust, relationship Salespeople obtain commitments only after they have demonstrated the initial value for the prospect to consider building a relationship. Gaining commitment only advances if the salesperson continues to show the ability to create future value together.

*Confirming and validating the buyer's concern is part of which process?

understanding

*Which of the following is true of time management?

you cannot manage time you can only manage what you do with it