exam 2 review mark 3337

customer attrition

the inevitable loss of customers over a period of time

from first impression people will form opinions on

• Economic level • Education level • Trustworthiness • Social position • Level of sophistication • Social and educational heritage Success in current endeavors • Moral character • If they like you!

There are different buying processes in different cultures.

- In Japan, decisions are made by group process - In China, a senior negotiator leads - In Germany, even for routine decisions, top level leads - In Latin America, relationship building occurs before negotiation

Solution Sales Process

- Uncovers and clarifies a customer's problem - Works with the customer to create a vision of how things could be better - Develops a plan for implementing the vision

The purpose of asking spin questions

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

Three things to improve the quality of the prospecting effort:

1. Increase the number of people or accounts who board the Ferris wheel. 2. Improve the quality of the prospects who board the Ferris wheel. 3. Shorten the sales cycle by quickly determining which of the new prospects are qualified prospects—qualified as to need, authority to buy, ability to pay, and authority to purchase the product.

4 Strategies to researching a prospect

1. Learn about the company • Basics: size, employees, product/service offerings • Follow news and social media... google them! 2. Do a background check • Who do you need to meet with? • What are their roles? 3. Hypothesize pain points • Use your research to assess how you can help • Understand your product/service offerings 4. Be curious to know more • Use all the knowledge gained to be curious • Don't judge or assume you understand

STEP 4 in documenting and delivering value

Buyer VP - A Central Business Skill 1. Development of Value proposition - as a training input for better business 2. VP tied to long term success

The Better Mousetrap

Create a mousetrap that is unique or highly differentiated The value lies in the mousetrap The role of sales is to communicate the value of our mousetrap So sales is value communication

Product Positioning

Creating and maintaining a certain concept of a product in customers' minds • It requires developing a sales and marketing strategy aimed at influencing how a particular market segment perceives a product in comparison to the competition. • The positioning process must be continually configured, and custom fitted by the salesperson to match each customer's specific wants and needs.

• Product knowledge

Customers seek out the "product experts" who can assist them in making intelligent buying decisions

STEP 3 in documenting and delivering value

Document Value Delivered 1. Keep a track of value created 2. Build case histories 3. Emphasize on how it was done

There are three major types of consumer buying situations

Habitual Buying Decisions, Variety-Seeking Buying Decisions, Complex Buying Decisions

Prospecting

Identifying and developing potential customersit is called Prospecting in B2C - Account or business development in B2B

Implication Questions (SPIN)

Implicating the need is essential for the prospect to see HOW your business, service, product is the solution to their need BLOWS UP the pain or gain associated with CHANGE They help the buyer realize the costs of doing nothing outweigh the cost of the solution

There are three major types of business-to-business (B2B) buying situations:

New-Task Buy, Straight Rebuy, Modified Rebuy

reasons for customer attrition

One-time need or an extended time between purchases • Movement outside of territory • Customer business failure or merger • Loyal buyer or purchasing agent changed positions • Sales are lost to the competitio

The Alternative Business Model

Our mousetrap is one of many ways to kill mice There's not enough value in the mousetrap to differentiate us from competition So the role of sales is to add value to our mousetrap Sales becomes value creation, not value communication

Need Payoff Questions

Questions that gain commitment to move the selling process forward solution found Are you interested in learning more about what our company can offer?

STEP 2 in documenting and delivering value

Substantiate Your Value Claims 1. Use of concrete steps to display value creation - value calculators/ comparisons against other benchmark studies 2. "We can save you money" - should not be fairytale

Feature-Benefit Strategy

Successful sales presentations create value by translating product features into benefits that meet a specific need expressed by the customer

Zero Moment of Truth (ZMOT)

The moment when a customer uses a digital device to begin learning about a potential purchase.

step 1 in documenting and delivering value

Understand Buyer's Business 1. Invest in getting to know your buyers 2. Tap into unmet needs 3. Co-ideate on possible solutions

value story

We are 22 times more likely to remember a fact when it has been wrapped in a story storytelling is about delivering the value proposition

solution

a mutually shared answer to a recognized customer problem • In sales a solution is more than a specific product... it often provides measurable results such as greater productivity, increased profits, or less employee turnover Selling a solution versus selling a specific product requires a greater effort to define and diagnose the customer problem

The "need behind the need" dr analogy

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

lead scoring video

assigning a value to each lead so your sales team can prioritze outreach first step- determine the lead-to-customer conversion rate for all your leads second step- examine different attributes to determine what makes someone more likely to beocme a customer this inludes tthings like location business size, or behavioral data third step- compare the close rate of customers with each attributethe higher the close rate the more points you will reward

customers are researching about products especially from video dharmesh

b2b

value equals

benefits - costs

Quantifying the value proposition is important in many situations, especially when

customer is a business buyer (B2B).

product

encompasses information, services, ideas, tangible products, or some combination of these that satisfy the customer's needs with the right solution.

New-Task Buy

first-time purchase of a product or service.

Situation Questions

general data-gathering questions about background and current facts that are very broad in nature

How do you provide value to customer's through SPIN

give a solution

How to effectively build rapport and meet a prospect

good first impression set an agenda

Complex Buying Decisions

have a high degree of involvement by the consumer. Consumers are highly involved when a product is expensive, infrequently purchased, and highly self-expressive.

Variety-Seeking Buying Decisions

have low customer involvement, but important perceived brand differences.

Features

include data, facts, and characteristics of a product or service ex. The hotel conference rooms were recently redecorated.

Benefits

include whatever provides a customer with a personal advantage or gain, which can be general or specific. ex. This means all your meetings will be held in rooms that are attractive as well as comfortable.

finding need behind need example

initial need expressed- we need to move to a different office space need behind the need- Because we are growing and are going to hire more people so need more room and be closer in town. More strategic "need behind the need"- Because we need to be closer to our customers and our biggest competitor is located closer in town.

Product Configuration

product selection process for complex buying needs

Straight Rebuy

routine purchase of items needed by a business-to-business customer.

value proposition

set of benefits and values the salesperson configures to meet and exceed customers' specific needs. The value quantification process raises customers' comprehension level as they discover the merits of buying your product or service. • It requires communicating how your solution will impact business results, such as providing increased reliability or lower maintenance costs.

The four kinds of questions

situation, problem, implication, need payoff

New vs. mature product selling models

slide 8 ch 7

Buying Process

stage 1- sales inquiry stage 2 needs awareness stage 3 evaluation of solutions stage 4 resolution of problems stage 5 decision/purchase stage 6 implementation

Product Differentiation

the creation of real or perceived product differences

Qualifying

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

Habitual Buying Decisions

typically require low consumer involvement and brand differences are usually insignificant

Modified Rebuy

when customers may wish to modify product specifications, change delivery schedules, or renegotiate prices. This requires the involvement of several participants, including suppliers.

Problem Questions (SPIN)

• These are meant to help assess the needs or problems your client/prospect might have • They provide the necessary answers to how you can be the solution • Allow the client/prospect to articulate the challenge or opportunity - beware of answering it for them