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Unit 3

Professional Selling

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SE:017

Explain the nature and scope�of the selling function

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Selling is a marketing function that involves:

Determining client needs and wants
Responding through planned and �personalized communication
Influencing purchase decisions
Enhancing future business �opportunities

SE:017 Explain the nature and scope of the selling function

Selling

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Types of Buyers

Consumers for ultimate consumption
Organizations for resale
Organizations for business operations

Production of other goods
General operating purposes

SE:017 Explain the nature and scope of the selling function

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Types of Sellers

Entrepreneurs

SE:017 Explain the nature and scope of the selling function

Manufacturers

Retailers

Wholesalers

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Types of Products

Tangible

SE:017 Explain the nature and scope of the selling function

Intangible

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Selling and the Economy

Economic flow
Competition
Employment
New products

SE:017 Explain the nature and scope of the selling function

Selling is the driving force behind the movement of resources from resource owners to producers and from producers to consumers.

This continual process is known as the economic flow.

It is how sales keep our economy moving.
Each business plays some part in this process.

Businesses seek to gain the largest share of this movement as possible.

In order to do so, they must constantly develop new and improved products.
In this way, sales promote competition.

As a company’s sales increase, they hire more people to keep up with the demand for their product.

Selling directly affects employment within an economy.

Selling also adds utility and helps customers determine their needs and the products that can fulfill them.

This is how selling helps create the desire for new products, which keeps the whole process moving.

Discussion #1: Ask your students to discuss how selling can lead to the development of new products.

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Successful Selling

Education and training
Self-motivation
Self-confidence

SE:017 Explain the nature and scope of the selling function

Every business needs great salespeople to succeed. Luckily, salespeople can acquire all the characteristics they need with a little hard work. Here are some of the characteristics of successful salespeople:

Education and training

While experience goes a long way in improving your selling skills, a degree in business, marketing, or a related field can help you get your foot in the door.
Many companies also have training programs for their new salespeople.

Self-motivation

Often, salespeople don’t receive a lot of close supervision over their daily activities.
Successful salespeople stay on task anyway!

They are excellent time managers who are able to motivate themselves to achieve their goals.

Self-confidence

Stand up straight, speak clearly, look the client in the eye, and be proud of your product.
If you don’t believe in your product, neither will the customer.

Discussion #2: Ask your students to discuss which they think is more important for success in sales: belief in yourself or belief in the product?

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Successful Selling

Product knowledge
Customer knowledge
Persistence and patience

SE:017 Explain the nature and scope of the selling function

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Successful Selling

Ethics
Personal appearance

SE:017 Explain the nature and scope of the selling function

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SE:076

Explain customer service as a component of selling relationships

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A process, not a function
Enhance and facilitate the customer’s use of the good or service
Should be tailored for each customer

SE:076 Explain customer service as a component of selling relationships

Customer Service in Selling

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Competition and Customer Service

Price and quality can be matched.
Customer service is the real competition.
Meet and exceed customer needs.

SE:076 Explain customer service as a component of selling relationships

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Customer Expectations

Based on:

Past experience
Word-of-mouth
Advertising
Individual needs

SE:076 Explain customer service as a component of selling relationships

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Keys to Success

Solicit feedback.
Keep in touch.
Be prompt.
Have a good attitude.

SE:076 Explain customer service as a component of selling relationships

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Benefits of Customer Service

SE:076 Explain customer service as a component of selling relationships

Building partnerships with current customers
Generating new customers

The importance of providing quality customer service cannot be overstated. Since every business relies on customers to purchase their products, keeping those customers happy is a big part of a company’s success. There are two major ways that quality customer service can bring in profits:

Building partnerships with current customers

Maintaining a relationship with a current customer is less expensive and time-consuming than generating a new customer relationship. Loyal customers also lead to referrals, which are also cost-effective ways of building your customer base. Satisfied customers can serve as a sort of sales team for you.

Generating new customers

Quality customer service improves your company’s reputation, and a better reputation means more business.

Discussion #1: Ask students if they ever made a recommendation to a friend or received a referral or recommendation that they followed through on. Did the salesperson meet expectations of the referral? Would you refer other people to their business? Why or why not?

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Presale Opportunities

Suggestion selling
Product information
Promises you can keep

SE:076 Explain customer service as a component of selling relationships

Although much of customer service takes place after the sale has occurred, salespeople still have many opportunities to provide customer service before the sale.

Suggestion selling

A salesperson can add value to a customer’s experience by suggesting additional products or services that will enhance his/her primary purchase. As long as suggestions are appropriate and well-timed, suggestion selling can go a long way toward building solid partnerships with customers.

Providing ample product information

Only make promises you can keep.

Discussion #2: Ask students if they family member has experienced a salesperson who did not keep their promise. Do they think the salesperson intended to keep the promise or was just trying to make the sale? Would they ever consider doing business with that person again?

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Post-Sale Opportunities

SE:076 Explain customer service as a component of selling relationships

Order processing
Shipping and delivery
Installation
Warranty issues

Maintenance and repair
Credit/Financing
Technical assistance and support
Customer training

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SE:932

Explain company selling policies

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Selling-activity policies
Terms-of-sale policies
Service policies

SE:932 Explain company selling policies

Selling Policies

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Selling-Activity Policies

Prospecting
Opening the relationship
Qualifying the customer
Entertaining the customer
Sales presentation
Sales quotas
Floor models or “open box” items
Account servicing

SE:932 Explain company selling policies

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Terms-of-Sale Policies

Pricing policies
Discount policies
Credit policies
Liability policies

SE:932 Explain company selling policies

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Service Policies

SE:932 Explain company selling policies

Return and adjustment policies
Delivery policies
Installation policies

Guarantee policies
Repair and maintenance policies

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Characteristics of Selling Policies

Framework for:

Meeting goals
Increasing profitability
Decision-making
Establishing good customer relationships

SE:932 Explain company selling policies

Selling policies should:

Apply equally to everyone in company
Be flexible
Be enforced

A business adopts selling policies to help meet its goals and increase profitability. They help accomplish this by providing a framework by which to make appropriate decisions and establish good relationships with customers.

Selling policies can benefit the salesperson, the company, and the customer.

They may also enhance employee loyalty, increase job satisfaction, and contribute to a more pleasant working experience.

Selling policies should apply equally to every salesperson in the company.

They often need to have enough flexibility so that an occasional exception can be made when needed and yet be interpreted and enforced in a reasonably firm manner.
In extreme cases, poorly administered policies can force a company out of business.

Discussion #2: Ask students to discuss why it is important for selling policies to be firmly enforced. What could happen when a selling policy is not enforced in all/most cases?

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Influencing Factors

Internal factors

Corporate goals and objectives
Human and financial resources
Production capacity
Research and development efforts

SE:932 Explain company selling policies

External factors

Customer needs/wants
Competitors’ actions
Availability of raw materials
Social concerns

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Regulatory Factors

Antitrust regulations

Sherman Act
Robinson-Patman Act
Clayton Act
Federal Trade Commission Act

Consumer-protection regulations

Fair Packaging and Labeling Act
Truth in Lending Act
Credit Card Act of 2009

SE:932 Explain company selling policies

The third basic group of influencing factors are regulatory factors. These include:

Antitrust regulations

The Sherman Act prohibits competing companies from conspiring to control prices.
The Robinson-Patman Act forbids companies from discrimination in price or services. Businesses can only offer lower prices to big companies if the discounts are based on cost savings.
The Clayton Act keeps a company from making the purchase of one of its goods or services dependent on purchases of others.
The Federal Trade Commission Act declares any competition deemed unfair by the Federal Trade Commission to be illegal.

Consumer-protection regulations

The Fair Packaging and Labeling Act makes it illegal to use unfair or deceptive packaging or labeling.
The Truth in Lending Act and the Credit Card Act of 2009 require companies to be fair and transparent with their credit practices.

Discussion #3: Ask students why it is important for packaging to be fair. Can they think of an example of unfair or deceptive packaging?

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SE:062

Acquire product information for �use in selling

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Boosts self-confidence
Improves credibility with customer
Helps with comparison between products

SE:062 Acquire product information for use in selling

Why Use Product Information

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Types of Product Information

Physical characteristics
Usage information
Pricing and logistics

SE:062 Acquire product information for use in selling

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Sources of Product Information

Manufacturers
Sales representatives
Customers
Industry sources
External sources

SE:062 Acquire product information for use in selling

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Guidelines for Using Product Information

Acquire knowledge of the industry as a whole.
Learn what’s important to target customers.
Avoid jargon.
“Features tell, benefits sell.”

SE:062 Acquire product information for use in selling

Product information is actually about more than just the features of the product itself. Zoom out and think more broadly. Consider all of the other knowledge that you can gather that could help. For instance:

Acquire knowledge of the industry as a whole.

Find out what’s important to your target customers.

Avoid jargon.

Using too much industry-specific language may overwhelm or confuse your customers. Describe product information in a way that your customers will appreciate and understand. This could change for each customer. In order to be adaptable, be able to put things into your own words.

Remember: “Features tell, benefits sell.”

Explaining features offers the customers facts about a product; explaining the benefits they will get from using the product gives them reasons to buy it.

Discussion #2: Ask your students to select an item in the classroom, then make a list of features and benefits for that item. Which benefits would they highlight in a sales presentation? If you have time, turn this into a role-playing activity.

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The Information-Gathering Process

Use the product!
Read all available product literature.
Get connected.
Talk to your customers.
If you don’t know something, find out fast!

SE:062 Acquire product information for use in selling

It can be easy to feel overwhelmed when learning all of the features and benefits of a new product, especially when you know you’ll have to face questions from customers. If you follow these steps, you’ll be off to a good start:

Use the product! Practical experience is the best source of product information for selling. If you have a product you cannot easily use yourself, talk to the people who do use it. Have them demonstrate it for you.
Read all available product literature. It is your responsibility to keep abreast of any changes made to a product. Even if you think you are already an expert, you may be surprised about what new information you can find.
Get connected. Participate in product training. Attend trade shows. Make sure you are receiving online updates. We live in a world of instant communication. There’s no excuse for not staying connected to the latest news about your industry or product.
Talk to your customers. Develop relationships with your customers where you can. Find out how they are using the product. What do they like best about it? See if they have any experience with competing brands.
If you don’t know something, find out fast! There may be times when a customer asks a question you can’t answer or has a need you’re not quite sure your product will meet. Find the answer and communicate it as quickly as possible.

Discussion #3: Ask students to discuss a time when they bought a product and found out something new about it after they started to use it. If their salesperson had followed up with a phone call, that could have become a benefit for the next sales pitch.

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SE:048

Explain the selling process

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Preparing to sell
Establishing relationships with customers
Discovering customer needs
Prescribing solutions to customer needs
Reaching closure
Reaffirming buyer-seller relationships

SE:048 Explain the selling process

The Selling Process

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Preparing To Sell

Identifying features and benefits
Planning a sales presentation
Sales leads

Generating
Qualifying

SE:048 Explain the selling process

Preparing to sell almost always involves identifying a product’s features (the characteristics of a product) and benefits (the advantages that features offer the user).

Acquiring this information is an important step in planning a sales presentation or pitch that provides information, points out benefits, and convinces the customer to buy a product.

In some cases, salespeople are required to participate in generating sales leads and qualifying sales leads, which are the acts of finding potential customers and then determining if those customers have the interest, ability, and authority to purchase a product.

During this process, the salesperson should try to learn as much as s/he can about the business or the personal characteristics of the customer.

Discussion #1: Ask students if they have ever encountered a salesperson who seemed unaware of important product information. What question was the salesperson unable to answer about the product? Did they end up making the purchase anyway? Why or why not?

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Establishing Relationships

Put customers at ease.
Encourage customers.
Gain customer confidence.
Create favorable impressions.

SE:048 Explain the selling process

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Discovering Customer Needs

Questioning customers
Observing their answers and reactions
Analyzing the information

SE:048 Explain the selling process

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Prescribing Solutions

Deliver planned sales presentation.

Sales dialogue
Product demonstration

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Reaching Closure

Identify and answer remaining objections.
Ask for the sale.
Get the order and complete paperwork.

SE:048 Explain the selling process

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Reaffirming Buyer-Seller Relationships

Follow up.
Suggestion selling
Provide customer service.

SE:048 Explain the selling process

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MK:014

Explain factors that influence�buying behavior

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Basic vs. higher order needs
Responding to needs and wants

Recognize a need.
Assess options.
Narrow options.
Make decision.

MK:014 Explain factors that influence buying behavior

Buying Behavior

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Cultural Influences

Culture
Subculture

MK:014 Explain factors that influence buying behavior

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Social and Personal Influences

Membership groups
Reference groups
Opinion leaders

MK:014 Explain factors that influence buying behavior

Social interactions also have a strong effect on purchasing decisions. Among the many social influences that affect buying behavior are:

Final consumers belong to many social groups in addition to their families. These membership groups include associations at school, religious institutions, neighborhoods, and friend groups.

Reference groups are those that a consumer is not a part of but can still influence buying behavior.

Sometimes consumers make purchases that show they aspire to be a member of a certain group.
Sometimes consumers don’t buy a product that they fear will make them appear to be in a group they do not want to be associated with.

Discussion #1: Ask students if they can think of a time when they did not buy something because they thought others would judge them negatively for buying it. What was the product? What made them think people would not approve?

Opinion leaders are people consumers want to emulate. These role models might be athletes, musicians, actors, or other types of celebrities.

Discussion #2: Ask students if they have ever purchased a product because they were inspired by a celebrity or other opinion leader. Have they ever bought something because they wanted to impress someone at school? What about that item made them think it would be impressive?

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Personal, Psychological, and �Situational Influences

Personal factors

Age, gender, stage of life

MK:014 Explain factors that influence buying behavior

Psychological factors

Perception, beliefs, attitudes

Situational factors

Special occasions

Occupation, discretionary income
Personality, lifestyle

Promotions/Sales

Even consumers who belong to the same culture, subculture, and social groups are still unique individuals.

Personal factors that affect buying behavior include:

Age, gender, stage of life, occupation, discretionary income, personality, and lifestyle

Every consumer views the world through the lens of her/his own perceptions.

This personal picture of the world guides how people make sense of the stimuli they receive.
Information that is received through one of the five senses is then interpreted based on a person’s expectations, beliefs, and attitudes.
Psychological influences such as motivation, learning, and perception are all of great interest to marketers.
Consumers’ buying decisions aren’t based on an objective reality, but rather on their own, individual reality.

Specific situations can also override some of the more dominant influences on buying behavior such as culture or personality.

People might spend more extravagantly on a birthday weekend, for example.
Promotions or sales can also create situational influences that affect buying behavior as well.

Discussion #3: Ask students how they might structure a sales presentation to convince a customer to buy a product they might not otherwise buy. How would they create a situation in the customer’s eyes that would make them break their normal buying behavior?

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Business Buying Behavior

Technical products in larger quantities
Little impulse buying
Long-term relationships
Shorter distribution channels
Bidding and negotiations

MK:014 Explain factors that influence buying behavior

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Business Buying Influences

External factors:

The economy
Politics/Laws and regulations
Competition
Technology

Internal factors:

Size and structure
Policies and procedures

MK:014 Explain factors that influence buying behavior

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SE:828

Explain key factors in �building a clientele

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SE:828 Explain key factors in building a clientele

Benefits for Business

Increased sales volume
Reduced selling costs
Customer loyalty
Word-of-mouth advertising
Increased income and profit

These are some of the benefits that companies come to enjoy if they have a robust customer base and a loyal clientele:

Increased sales volume

Because loyal customers continue to buy from a business, their support often leads to an increase in sales volume.

Reduced selling costs

Making the first sale to a new customer can cost a business a lot of money.
Gaining new customers often involves advertising in addition to the time spent learning their needs and wants and building up a new relationship.

Customer loyalty

Loyal customers are sometimes willing to stay with a business even through hard times or mistakes.

Word-of-mouth advertising

A customer that has a great sales experience with a business is likely to tell friends, family, and coworkers about it.
In this way, a satisfied customer can be a cost-effective way of generating new business.

Increased income and profit

The combination of these factors leads to the most important benefits: more sales, more income, and greater profits.

Discussion #1: Ask students if they think these benefits would still apply when selling a product that a customer is likely to buy only once or twice in a lifetime.

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Benefits for Salespeople

Increased earnings
Repeat sales
Referrals
Personal satisfaction

SE:828 Explain key factors in building a clientele

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The Cost of No Clientele

High customer turnover
Unhappy customers
Negative reviews

SE:828 Explain key factors in building a clientele

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Building Clientele

Prospecting

Lead sources

Company
Internal
External

SE:828 Explain key factors in building a clientele

Trade shows

Keeping customers

Building relationships

Preparation
Presentation
Follow-up

Finding customers isn’t always easy, and good prospecting is a skill that most salespeople have to work on throughout their careers.

Salespeople are typically responsible for doing their own prospecting, but they are often helped by leads they get through their company, as well as external and personal sources.

While getting new customers may be the hardest part of building clientele, keeping them can also present some challenges.

The most effective activities for salespeople building relationships and developing loyalty start with preparation, presentation, and follow-up.

Discussion #3: Ask students how they would go about getting new customers if the company they work for doesn’t provide leads to them. Where are salespeople most likely to meet potential customers? Would it be easier to get new customers in certain kinds of sales? Which ones and why?

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Service Attitude

Patient, courteous, friendly, sincere, honest, trustworthy

Have complete �product knowledge.
Show interest.
Pay attention.
Say thank you.
Stay connected.

SE:828 Explain key factors in building a clientele

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SE:106

Explain legal and ethical considerations in selling

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Selling Laws

Some are federal.
Some differ from state to state.
Protect both salespeople �and customers
Can protect the economy

SE:106 Explain legal and ethical considerations in selling

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Customers

SE:106 Explain legal and ethical considerations in selling

Types of Selling Laws

Competition

Employers and coworkers

There are many different selling laws, but they can typically be grouped into categories relating to:

Customers

Whether it is under the national enforcement of the Federal Trade Commission (FTC) or under state regulation (many states have adopted the Uniform Deceptive Trade Practices Law), customers are protected by law against unfair or deceptive acts or practices, such as misrepresentation and negligence.

Competition

There are many ways that the government seeks to ensure fair competition.
At the national level, this might mean preventing the formation of monopolies through the Federal Trade Commission Act, the Sherman Antitrust Act, and the Clayton Act. Other state and national laws seek to protect against slander or libel.
Bribery, reciprocity, tie-in sales, and price discrimination are also illegal as they can negatively affect competition.

Discussion #1: Ask students to discuss if they think there should be laws that prevent the formation of monopolies. What do they think would happen if monopolies were allowed to exist?

Employers and coworkers

Employers and/or coworkers can be held accountable for requiring or convincing others to participate in any of the illegal activities mentioned above.

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Ethics

SE:106 Explain legal and ethical considerations in selling

Ethics and laws

Ethics go beyond laws.
Ethical but illegal
Legal but unethical

Crucial for success �in sales

As the basic principles that govern behavior, ethics are not laws. In a sense, ethics go beyond laws to the heart of a person’s conduct. Our ethical and moral standards are how we determine what is right and wrong, and they influence every decision we make.

There are times when a person can be acting ethically but still be breaking a law, just as there are times when a person’s actions can be unethical even though they do not violate any laws.

Because selling is about building relationships just as much as it is about making a sale, ethical decision-making and behavior is crucial to being a successful salesperson.

If customers know their salesperson is honest and ethical, those customers are much more likely to continue to do business with her/him.

Conversely, when a salesperson does not behave ethically, negative effects can occur. This could result in damage to reputations of both the salesperson and the company.

Discussion #2: Ask students if they can think of any other examples in which a salesperson is acting unethically, but not breaking any laws. Can they think of any cases in which a salesperson might be acting ethically but still be breaking a law?

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Ethical Decisions

SE:106 Explain legal and ethical considerations in selling

Customers
Competition
Employers and coworkers

A person’s ethics can help guide them through situations that do not always have a clearly defined right and/or wrong approach. Similar to the laws previously mentioned, sales-related ethical issues can often be grouped together as relating to:

Customers

Salespeople often encounter ethical decisions when giving or receiving gifts, entertaining, answering questions, and maintaining confidences.

It is not always clear what constitutes a gift as opposed to a bribe, for example.

Salespeople will often have to navigate situations in which they want to be truthful with a customer but also make sure they are keeping company secrets.

Competition

It may be tempting to sabotage competitors, but spending too much time speaking ill of your competition doesn’t always reflect well on a salesperson’s own product or company.
Actually altering a competitor’s product to make it appear less desirable is ethically suspect (even if no one is looking).

Employers and coworkers

Being a poor role model, applying unreasonable pressure, or looking the other way when you see bad behavior are all examples of being unethical in the workplace.
Sabotage of coworkers can be just as big of a problem as sabotaging competitors.

Discussion #3: Ask students if they agree that it is unethical to sabotage their competition. Can they think of any situation in which they manipulated a situation in order to make someone else look bad?

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Copyright

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Acknowledgments

Content sourced from intellectual property owned by �MBA Research and Curriculum Center®

Digital-Based Photography Sources

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