Personal (personal) selling is the presentation of a product to one or more potential clients, carried out in the process of direct communication and with the goal of selling and establishing long-term relationships with these clients; This is an oral presentation by employees of a company of its products and services in a conversation with consumers, involving personal contact in the form of dialogue rather than monologue.
Types of personal selling strategies:
Standard sale;
Flexible sale.
Unlike other forms of product promotion on the market, personal selling establishes a direct connection with consumers. Before the development of modern electronics and telecommunications, selling was primarily done face-to-face. Today, personal selling is done face to face, by telephone, using fax, computers, and the Internet. Sellers can establish immediate and direct contact with buyers, counter objections, overcome declines in consumer demand, and develop long-term relationships that lead to various cross-selling opportunities. The disadvantage of personal selling is the expense associated with it. Therefore, it is not used for the purpose of reaching the mass market. The salesperson is an important strategic tool because he establishes a special sales relationship with consumers and has access to important environmental information. There are many different types of salespeople and their tasks. Trade management involves recruiting, selecting, hiring, training, motivating, evaluating, and sometimes terminating personnel. Every trading staff, even if it is only one person, must be governed.
Standard selling is a pre-worked and identical approach to all customers. This approach is effective when selling well-known, relatively cheap consumer goods.
Flexible selling is a sale that involves an individual approach to each buyer, “adjusting” the seller to the individual needs of the consumer. This approach is effective when selling industrial goods, services, and in cases where the product is little known or relatively expensive.
Advantages of personal selling:
Individual attention to each customer;
Flexibility;
Involving consumers in dialogue;
Availability of immediate and clearly expressed feedback;
A strong focus on getting the buyer to make a purchase immediately.
Disadvantages of Personal Selling:
High costs per customer;
A limited number of buyers per seller at any given time;
The success of a sale is often highly dependent not on the properties of the product, but on the personal qualities of the seller.
There are several different types of personal selling:
Peripheral sales - concluding deals on site with a sales representative.
Retail sales - assistance at a point of sale from a full-time salesperson.
Home-based sales - transactions with a sales representative who comes to customers' homes.
Personal selling is most important for companies that sell products that require explanation, demonstration, and service. Modern companies spend enormous amounts of money on training sales staff in the art of selling. All approaches to training are aimed at transforming the sales representative from a passive order taker into an active order taker.
Marketing communications at points of sale are becoming increasingly important in the activities of specialists working in the market. If previously the strategic goal of marketing communications was the sale of a product, service, or brand, then within the framework of the new concept of relations the strategic goal is to form loyalty of the target market as the basis for favorable conditions for sales.
This (second) part of the manual examines personal selling from the perspective of relationship marketing, that is, the marketing aspect of selling is considered as dominant and determining. This approach differs from the prevailing views, in which the basis of sales were psychological techniques of influencing a potential consumer. In addition to the marketing aspect of sales, the communication and psychological aspects are considered; all three aspects are interconnected and interdependent.
A special feature of this textbook is that personal selling is included in a separate group of communications, while the American school considers personal selling in the structure of direct marketing. In our opinion, direct marketing allows for indirect point-to-point communications that require certain means of transmitting a message (e-mail, catalogs, leaflets, etc.), while personal communications require direct contact between the seller and the buyer. The strategic goal of direct marketing is to inform and motivate to purchase, and the strategic goal of personal selling is a transaction, an act of buying and selling.
The importance of personal selling increases every year. If previously they were actively used as a means of a complex of marketing communications only in markets for industrial goods, today personal sales end with any purchase decision-making process - by final or organizational buyers in the market of goods and services.
Mastery of sales technology is necessary for all specialists - retailers, advertising specialists, and all those who are focused on forming long-term relationships with their clients and customers.
Chapter 1. The Marketing Aspect of Personal Selling
1.1. Personal selling in the complex of marketing communications
The ability to communicate with people is a commodity that can be bought in the same way as we buy tea or coffee, but for this product I am willing to pay more than for anything else.
J.D. Rockefeller
The marketing communications complex is a unified set of communication components that unites participants, channels and means of communication and is aimed at establishing and maintaining relationships between the organization and the marketing environment in order to achieve marketing goals.
Essentially, marketing communications seek to influence consumer behavior, so it is necessary to understand the nature of marketing thinking and, in particular, consumer behavior. There are several starting questions that the communicator must answer, based on his understanding of the essence of marketing thinking: what are the consumer preferences; what influences consumer behavior in the market; who influences purchasing decisions; how consumers make their decisions; What marketing tools can and should be used?
The process of selling a product itself is also communication, which is considered primarily by sociologists and marketers. The final decision to buy (not to buy) is made as a result of the influence of many factors. The impact of these factors and the buyer’s feedback constitute the essence of the communication process in the trading sphere.
If previously the main goal of marketing communications was the promotion of goods (services, organizations, brands), then the goal of modern marketing is relationship marketing - that is, the formation of long-term, friendly relationships between the organization and the marketing environment in which the promotion of goods (services, brands and organizations ) will be accomplished with lower costs and greater economic and communication efficiency.
Marketing communications can be divided into three groups: basic, supporting, additional, Fig. 1.1.
Rice. 1.1. Complex of marketing communications
Basic marketing communications serve as a means of directly promoting a product, service, brand and are aimed at the target audience. The main marketing communications include advertising, sales promotion, personal selling and direct marketing.
Supportive marketing communications perform the function of promoting the organization itself in the marketing environment, forming its image in society and is focused on the target public. Supporting marketing communications include public relations, exhibitions and fairs, souvenirs, sponsorship and licensing.
Additional marketing communications are focused on consumers and promotion at points of sale. Such marketing communications include merchandising, packaging, advertising materials at points of sale, tastings, etc. Depending on the specific product category, this list can be expanded and supplemented.
Personal selling is a marketing communications tool that is used to make sales directly through personal contact between the seller and the buyer. As follows from the definition, personal selling is one of the promotion tools, part of the marketing communications complex, and is in the nature of direct personal communication. Other means of marketing communications (advertising, sales promotion, public relations, direct marketing, etc.) contribute to sales, but their impact is indirect: lack of personal contact, specific promotion tasks not focused on immediate sales.
Personal selling is typically associated with industrial marketing, but today it is becoming an indispensable promotional tool for large retail buyers and any organization that makes large purchases. A distinctive feature of such procurement is that the decision to make a purchase is made by a special group - the decision-making group (DG), consisting of several participants.
For each type of product, its own “communication mix” is formed - a set of communication tools that is optimal from a cost point of view and the most effective from a communication point of view. The formation of such a mix involves not only choosing the optimal set of communication means (mix structure), but also determining the significance of each of them (mix hierarchy). For example, for the promotion of packaged consumer goods, the most significant means of promotion will, of course, be advertising, with personal selling playing a minimal role. And for the sale of industrial equipment, the roles of advertising and personal selling are reversed: in this case, personal selling plays the main role, and advertising plays a secondary role.
Let's take a closer look at the factors that influence the formation of the communication mix. The structure of the marketing communications mix is influenced by:
Type of product (consumer goods, industrial goods, etc.);
- stage of the product life cycle;
- the degree of purchasing readiness of a potential client;
- promotion strategy implemented by the organization (push or attract strategy);
- features of the complex of marketing communications of competitors;
- financial capabilities of the organization;
- consumer awareness and commitment to the brand and others.
The relative importance of promotional means depending on the type of product is shown in Fig. 1.2. Naturally, we are talking about averaged data - the average for packaged goods, durable consumer goods, and industrial products.
Personal selling is the only component of marketing communications that involves personal contact between the seller and the buyer, during which the consumer characteristics of the product are verbally presented, and a joint decision is made on the possibility of a transaction, purchase and sale. Personal contact is a huge advantage over other promotion tools, as it allows you to directly present the product to a potential buyer, control the communication process in feedback mode and form an individual approach to each buyer.
Rice. 1.2. The relative importance of promotional means depending on the type of product:
R - advertising;
SS - sales promotion;
PR - public relations;
LP - personal sales
Personal selling differs from other elements of marketing communications in that their main task is to form a sales channel for products by establishing a trusting relationship with a potential buyer. Let's tabulate the complex of marketing communications and the promotion tasks being solved, table. 1.1.
Table 1.1. Types of communication and promotion tasks to be solved
|
Types of marketing communications |
Typical promotion tasks solved |
Contact audience |
|
Creating awareness of products, brands, organizations, positioning using name, corporate identity elements, advertising character and slogan |
Mass audience |
|
|
Sales promotion |
Stimulating sales through the formation of incentive measures for intermediaries, sales personnel, retail and end consumers |
Certain groups of people (participants in the sales process) and mass audiences (end consumers) |
|
Public relations |
Forming a favorable public opinion of the marketing environment for the purpose of successful business development and creating a positive and manageable image of the organization |
Target public, some of which may not be potential consumers |
|
Personal selling |
Formation of a product sales channel by establishing personal trusting relationships with a potential buyer |
Certain individuals in organizations (executives and senior managers) and purchasing groups in organizations (participants in the purchasing decision process) |
Personal selling is, first of all, an effective tool for promoting industrial goods and similar ones, which has a number of advantages in comparison with other means of promotion. Let's list these advantages.
1. Personal contact. Each party participating in communication can get acquainted with the proposals and wishes of the other, using all their channels of perception (visual, auditory, kinesthetic).
2. Flexibility of relationships. On the one hand, personal selling allows the seller to almost instantly select socially significant communication tools (speech, gaze, gestures, motivation strategy) and, on the other hand, personal selling allows the development of all types of relationships between the parties - from the superficial “seller-buyer” connection to personal friendship.
3. Dialogue mode of communication. Personal selling is always carried out in feedback mode. This allows the seller to change the strategy and tactics of negotiations in the process of communication with the client, analyzing in real time the information received from the potential buyer.
4. Possibility of using sales promotion elements focused on the individual characteristics of the buyer. To successfully make a sale, the seller needs to understand what basic marketing factors (product, market, consumers) underlie the purchasing decision.
Like other communication tools, personal selling has some disadvantages.
1. High costs. This is the most expensive promotion tool, since the cost of one contact includes working hours, travel, wages of sales representatives, and staff training in sales technologies.
2. Difficulty in unifying sales technology. Depending on the specifics of the product, organizations develop proprietary sales standards or sales technologies.
In personal selling, the object of influence is the buyer, and knowledge of the marketing factors of personal selling (product factors and consumer factors) serves as the starting point for developing sales technology, Fig. 1.3.
Rice. 1.3. Marketing Factors of Personal Selling
However, in real market conditions, the seller must respond flexibly to the behavior of a potential buyer, while showing the talent of a communicator, an experienced psychologist, and a presentation master. The fact is that the modern market is a market of active buyers, which presupposes active and professional sellers. The characteristic features of such a lid are:
Similarity of goods and services;
- similarity of prices;
- similarity of design;
- narrow segmentation of the consumer market;
- excess of similar offers;
- tough competition;
- demand remaining at the same level or partially decreasing;
- increased consumer demands for the quality of goods and services;
- increased requirements of buyers for the qualifications of sellers.
In general, in the modern market, the critical attitude of the consumer towards products and companies is decisive. These factors not only increase competition in the industry, but also give special importance to the organization's communications with the marketing environment. Therefore, the organization’s sales policy should place special emphasis on building trusting and long-term relationships with customers and constantly taking into account their changing needs and desires.
Selling, as such, plays a vital role in the economic system. She:
Introduces innovations to the market;
- promotes consumption;
- conveys meaningful information;
- acts as a communication channel;
- helps solve buyer problems.
The real trend towards increased competition means that when selling, organizations must have:
The ability to identify what the buyer is doing;
- the ability to put together groups of products to form a business proposal;
- the ability to sell to pre-prepared buyers;
- the ability to improve sales technologies;
- ability to increase value through professional service;
- the ability to effectively use the advantages that their own products have compared to the products of competitors;
- an adequate strategy for managing sales specialists.
Buyer-focused selling is an advanced practice that requires the ability to accurately assess situations, make independent decisions, build long-term relationships, create conditions for mutual satisfaction and achieve a true business partnership.
In modern conditions, customer orientation is a consequence of the adoption of the concept of relationship marketing as the basic principle of the organization, built on four main premises.
1. The success of any organization in the market depends, first of all, on the consumer, on whether he wants to buy something and pay for the purchase.
2. The organization must be aware of customer needs, preferably long before production begins, and in the case of high-tech and capital-intensive industries, long before production is planned.
3. Customer needs must be constantly monitored and analyzed in such a way that the organization is always ahead of its competitors in terms of “product” and “market development”.
4. Senior managers must strive to integrate all components of the marketing strategy (i.e., the four Ps of the marketing mix: product improvement, pricing, product placement, and promotion) into a single strategic plan based on an understanding of consumer behavior.
We have already noted that when we talk about personal sales, we usually mean the sale of industrial goods, raw materials, and equipment. But increasingly technologically advanced consumer goods increasingly require the personal participation of a sales consultant (computers, household appliances, finishing materials).
Recently, there has been a tendency to switch to distribution methods of personal sale of consumer goods. Thus, a whole complex of sales activities based on personal selling arose. Multi-level marketing is also based on personal selling.
Multi-level marketing is the organization of a sales system based on the principle of “self-reproduction” of distributors who, within the framework of this system, have the opportunity to receive multiplex income. Such well-known networks of companies as AVON and Tseptor operate on the principle of multi-level marketing. In principle, almost any consumer goods can be distributed through multi-level marketing.
1.2. Sales technologies
Selling technology is based on knowledge about the market, the product and the buyer, but it will never generate income for the company if it lacks creativity.
Bruce Merrifield
Today, the organizational and final consumer will buy there (all other things being equal) where the sales consultant who owns the sales technology and acts in accordance with the organization’s communication strategy turns out to be more professional. Technology (gr. techne - art, skill) - a set of methods, the science of ways to influence an object or system with the aim of changing it.
On the one hand, sales technology is a standard sales procedure developed for a specific product (service) and for a specific organization and based on the specifics of the product being sold and the specifics of the client. This procedure serves as the basis for training the organization’s sales staff.
On the other hand, sales technology is a set of methods of marketing, communication, and psychological influence on the buyer, developed on the basis of knowledge of the specifics of the product and buyers in order to make a sale, and replicated within one organization.
What is the difference between the old approach (“active sales”) and the new one (“selling technologies”)? It can be described in one phrase: “Don’t sell products, sell to customers!” Today's buyer is increasingly sophisticated, not only in relation to goods or services, but also in relation to trading organizations. Buyers trust sales agents more who focus primarily on them, on their needs, and not on the product itself. Based on the above, let’s imagine a personal selling model, Fig. 1.4.
Rice. 1.4. Personal selling model
The figure shows how personal selling priorities have changed. If the previous school of sales was based on the “art” of managing consumer behavior using psychological techniques and methods (even manipulation), then modern sales technology is focused on the marketing aspects of sales, which are based on knowledge:
1) how the product sold can satisfy customer needs;
2) how to build long-term relationships with clients based on trust.
The new approach does not exclude the use of psychological techniques in the act of personal selling; moreover, they remain one of its significant aspects; only sales priorities have changed - active selling has given way to relationship marketing.
Trust is the basis of good selling. Trust means that the prospective buyer trusts the seller, respects his knowledge, and is satisfied with the standards of service.
A salesperson's success in sales depends to a large extent on his prior preparation for how to behave in typical selling situations. Therefore, many organizations are now coming to understand the need to create corporate books with sales scenarios - “ABC Sales Technologies”.
This book contains a detailed description of all stages of the sale. Particular attention is paid to the detailed development of the communication and psychological foundations of selling. Based on the experience accumulated by the organization’s specialists, the most typical situations of working with a client, behavioral and language patterns, specially developed or adapted for the product or service of a given organization, for its accepted sales standards and for the main types of its clients are presented.
In a survey of executives conducted by the Business World center for marketing technologies (Novosibirsk), the majority of organizations selling complex products and services would like to have such books in their marketing arsenal, but do not have them in printed form. Most of them agree that a salesperson's behavior should be 75% regulated by a pre-prepared typical scenario and only 25% determined by a creative approach. The availability of corporate books on sales technologies in organizations (according to the specified survey) is presented in Fig. 1.5.
Rice. 1.5. Availability of books on sales technology in organizations
The peculiarity of such a book is that it does not contain theoretical premises or generalizations; it contains only practical recommendations for each stage of sales. The book does not deprive the seller of initiative; on the contrary, he has the opportunity to approach the matter creatively. This sales technique can be compared to jazz: you will never play the same as last time, but the main theme is always unchanged and precise.
Preparing such a book requires the help of a specialist. Such a specialist consultant, based on corporate training, in which all sales specialists participate, collects and organizes available information. The results of this training, supplemented by communication and psychological techniques developed by a sales consultant, form the basis of sales technology. The structure of the book may be different, but individual sections should contain:
Unique competitive advantages of the organization;
- the most important facts about the organization that inspire confidence in it;
- good questions to ask the client, allowing you to understand his needs and get him to talk;
- typical client objections and responses to them;
- the most successful metaphors and comparisons - in relation to the goods and services being sold.
In other words, sales technology is becoming an important promotion tool, which consists of developing branded selling standards based on knowledge of how the product or service being sold can satisfy the buyer’s needs.
Practical advice
The basis of sales technology is knowledge!
Knowledge is power in customer-focused selling.
Knowledge helps you identify prospective clients who are worth calling.
Knowledge helps you determine which prospects make sense to focus on.
Knowledge can immediately set you apart from other sellers and let the prospective buyer know that you can truly help them.
Knowledge helps you build rapport with the buyer and earn their trust.
Knowledge helps you ask the right questions when identifying a buyer's problems, interests, and goals.
Knowledge helps you determine which product or service can best provide a solution to a customer's problems.
Knowledge helps you articulate how your product can help the customer.
Knowledge makes you aware of the strengths of your product compared to the competition (but never criticize your competitors).
Knowledge helps you paint a picture for the customer of how your products or services and your company can provide solutions for them in the future.
Knowledge makes you an important reference person that your customers will want to contact and hear industry news from.
Knowledge will increase the possibility of repeat contacts with customers.
Knowledge that helps customers will increase your referrals.
Knowledge will enhance your ability to expand your sphere of influence.
N. J. Stevens. Effective buyer-oriented sales. - M.: FAIR PRESS, 1999, p. 46.
Creativity and sales technology
When I was only seventeen years old, I worked for a while in a business selling vacuum cleaners. My commercial training consisted of following a veteran who had worked in this field for decades, he was neatly dressed, but very poorly and in old clothes.
His instructions were simple: “Just be quiet and watch.” It turns out that this is good advice.
We knocked on the door of one of the houses in a good area and a beautiful woman answered. He said he was going around just to demonstrate the effectiveness of his vacuum cleaner and would be happy to clean her living room carpet for free.
The woman agreed, and he began to energetically plow the carpet with a vacuum cleaner. When finished, I turned it off, methodically opened the case, pulled out the dust container, and then dumped all the dirt out of it into the middle of the clean carpet! The woman gasped in amazement, and that was exactly what he expected from her. A few minutes later she signed a contract to purchase this fantastic modern car.
As it turned out, my mentor was the luckiest salesman in the area and, when he was not at work, he drove a new BMW and dressed in pressed, beautifully tailored suits and sparkling shoes.
G. S. Goodman. Seven secrets of a born salesman. - M.: Grand, 1999, p. 56.
1.3. Personal selling market
Selling is finding people to sell to, and selling to the people you find.
Hopkins's postulate
Organizations that supply components, equipment and industrial goods perform a slightly different function than those organizations that deal with the end consumers of their goods. The business market is a professional market. It differs significantly from the consumer market by many factors that determine the market strategy and the ways of its implementation, including such as:
1) in professional markets, organizations deal with a wholesale buyer who deals in large quantities of goods, amounts of money, and is more demanding and prepared than the average consumer;
2) the organization of trade in such markets is carried out by trade departments staffed with highly qualified specialists, who have a perfect command of the market situation and are able to provide competent assistance in promoting goods to this market;
3) such markets exist as if independently of the ordinary, ordinary buyer;
4) in professional markets, multimillion-dollar transactions are concluded, that is, trading operations involve huge amounts of money, and accordingly the intensity of competition increases, investment risk increases, etc.;
5) the purchase and sale operation becomes more complicated and takes more time, which involves negotiations, transfer of funds, preparation of bank documents, etc.;
6) a large number of people are involved in trade transactions, each of whom has their own ideas and opinions on a particular issue;
A significant portion of direct sales is sales to organizations. Most purchasing decisions will involve more than one person to ensure smart choices and eliminate errors.
Organizational buyers are commercial entities and other organizations that purchase goods and services for the needs of their own enterprise or for their resale (with or without processing) to other organizations or end consumers. Organizational buyers are all buyers other than final consumers.
Organizational buyers represent three main types of markets:
1) industrial (industrial), or sectoral market;
2) market of resellers;
3) state market (government).
Industrial buyers purchase goods and services for use in the production of other goods.
Resellers are wholesale and retail trade organizations that buy products and resell them again without any processing (except for packaging, packaging, testing and other types of pre-sale preparation).
Government consumers are government bodies and government agencies at the federal, republican, territorial, regional or local level that purchase goods and services to meet government needs - in defense, security, education, healthcare, science, culture, etc. Government buyers are often required to conduct procurement on a competition basis.
Among the subjects of the personal sales market (or intermediaries), the following types are distinguished: wholesale organizations, distributors, dealers, agents, brokers, traveling salesmen, jobbers, etc. Let's look at the main ones.
Wholesale organizations are trading enterprises that have a wide range of products, as well as providing various services to consumers - transportation and delivery, storage, packaging, cutting, packaging, etc. Wholesale organizations acquire ownership of goods, have their own warehouses and inventories, vehicles, and brand. They trade on their own behalf, at their own peril and risk, at their own prices, which they receive by setting a certain markup for each type of product. Wholesale organizations have fairly strong and long-term contacts with their customers.
Distributors and dealers are types of wholesale organizations, although often their contractual rights are determined at the agent level. Distributors can be large wholesale buyers with their own warehouses and transport. However, most often they do not buy the goods as full property. They have various kinds of discounts and preferential terms of purchase from the supplier - trade credit, delivery of goods on consignment terms, a large deferment of payment, the right of first shipment, etc. They receive these preferential conditions in exchange for implementing strict market policies planned by the manufacturer in this market.
Distributors are required to conduct extensive advertising and propaganda work to promote the manufacturer’s products, popularize the brand, expand the circle of regular customers, look for new promising customers, hold presentations, seminars and meetings with buyers of these products, etc.
To receive all of the above benefits when purchasing goods, a mandatory condition for the distributor may be a ban on the purchase and sale of similar products from competing companies of the main supplier.
Most often, distributors serve certain geographic areas - regions. Some distributors receive exclusive rights to operate in the serviced territory, which means that competitors are unable to purchase and sell similar products from the supplier in a given region.
Thus, a manufacturer usually uses a distributor as a means of popularizing its product and conquering a new market. As a given market develops, the exclusivity is removed and the product is distributed through mass distribution channels.
The distributor can also be official. Official status does not mean exclusive implementation. It only gives the distributor and his clients some advantages in the field of prices, delivery conditions, service, etc. In each specific case, the capabilities and responsibilities of the distributor are stipulated in a special contract with the manufacturer or supplier of the goods.
Unlike distributors, dealers are small wholesale buyers; all other responsibilities and rights are similar to distributors. Most often, dealers are agents of distributors, serving to cover other regions and market segments and are directly subordinate to them. With an increase in sales volumes, a dealer can receive the status of a distributor, and vice versa.
Sales agents are persons who represent the interests of certain manufacturers in the sale of their goods. Sales agents receive their remuneration in the form of commissions. They do not buy goods as their own, but sometimes have inventory on a consignment basis - payment for goods sold after certain equal periods of time.
Here it is appropriate to highlight the manufacturer's agent and the sales agent. The manufacturer's agent sells part of the manufacturer's products, is limited to a certain geographic area, and has inventory on consignment terms. A sales agent serves consumers in a specific industry regardless of location. Sales operations are carried out from the manufacturer's warehouse. Agents can be supplier-dependent or independent. If they are dependent on a supplier, they may be deprived of the right to distribute similar products from competing suppliers.
The use of sales agents is advisable if the manufacturer produces one product or a very narrow range of products with a limited sales volume in each market area. A wholesaler will not focus much on one product that has a limited market. The agent sells no more than thirty items and will pay more attention to the product.
Sales agents work on the basis of an agency agreement - this is an agreement concluded between an organization and its sales agent for an indefinite period of time with the right to terminate it within a specified time frame. Agreements are distinguished by the scope of the rights and obligations of the parties. There are also agreements granting exclusive rights.
Brokers and commission agents are types of sales agents. The commission agent acts as an agent of the manufacturer, sells goods on consignment terms, that is, does not guarantee sales and works without a contract. A broker is a person who, independently or on behalf of a brokerage office, works on the stock exchange, where he sells part of the product on the order of the manufacturer. Products for admission to circulation on the stock exchange must meet certain requirements, namely, have a grade and standard accepted in trade.
The use of a particular intermediary may also depend on the type of product being distributed. For example, spare parts for cars are usually distributed through a wide network of agents with warehouse facilities, which makes it possible to ensure the fulfillment of orders from foreign companies in a fairly short time.
In commodity markets, special forms of trading have historically developed - exchanges and auctions. The distribution system for raw materials and food products is structured in such a way that direct sales traditionally occupy a significant place. This reflects the trend towards eliminating the intermediary in trade (with the exception of machinery and equipment, where the existence of an intermediary is explained by the specific conditions of sale).
The main task of sales specialists is to increase turnover. To successfully increase turnover, the following five functions are of great importance:
1) search for a promising buyer;
2) registration of buyers and their responses;
3) self-government;
4) relationship management;
Typical sales personnel tasks can be grouped into the following areas:
Sales itself, including identifying potential customers, studying their needs, discussing the terms of sale and concluding a deal;
- provision of services to customers, including assistance in using the product, after-sales service, product promotion, etc.;
- collection of information for the organization regarding changes in needs, competitor activity, and product adaptability.
In the organization itself, the following types of sales specialists can be distinguished.
A delivery representative whose primary role is the physical delivery of the product. The job mainly involves visiting existing customers to periodically receive (renew) orders. For example, the delivery representative of the Clean Water company signs an agreement with another company “X” for the next year or increases the volume of water supplied in the current year based on the received order.
The salesperson operating in the sales area takes orders and can act as an advisor or consultant to the client, especially in large stores of household appliances, clothing, etc.
The traveling representative meets with wholesalers and retailers to receive orders and ensure uninterrupted supply of goods.
The sales promotion representative organizes point-of-sale advertising for the brand and conducts promotional activities directly at the point of sale. Responsible for all sales promotion campaigns and exercises full control over them.
A commercial promoter does not accept orders, but only informs about new products. This type of sales representative is especially common in the medical supply and drug industry. His work involves creating an atmosphere of goodwill, informational promotion of products as part of constant communication with potential buyers.
A sales engineer who is technically competent and able to play a consultant role in helping the customer solve their problems. This work requires in-depth knowledge of product technical characteristics.
A traveling salesman (French commis voyageur) is a traveling sales agent who offers customers goods he has in stock, sells from a catalog to order (he has samples of goods and products with him), and accepts orders after demonstrating the goods at home or in the office. As a rule, it sells products that are easy to use and intended for end consumers: electrical equipment, encyclopedias, insurance policies. The decisive success of such sales is ensured by very high communication skills and a creative approach to sales.
Contract drafter for a complex project. Such a specialist, in addition to technical and financial competence, must have negotiation talent.
The organization's task is to correctly distribute responsibilities between sales specialists, the sales network and communications. Various organization of the work of sales personnel is possible: regional, product, by type of client or on a combined principle.
Regional organization is the most common because it is logical and simple, while at the same time it allows for the greatest control over the market at the lowest cost. With such an organization, the seller is the exclusive representative of the company for all its products for all potential and actual customers in the region.
This cheapest approach is applicable only when the products are few or similar, and all customers have similar needs. So, for example, an organization that produces paints and varnishes, whose clients are wholesalers and retailers, as well as industrial firms (construction, automotive) cannot have one representative for all clients.
Commodity organization is preferred when products are dissimilar or difficult to use. To respond to customer requests and combat competition, the sales representative must be more specialized. Costs can add up, especially if multiple representatives must visit the same client.
Organizing by customer is effective when customers have very different needs and require specific services. Customers can be classified by industry sector, purchase size, and other segmentation criteria. For example, most computer companies distribute their sales service among the following groups of buyers: administration, banks, industrial enterprises, trade. The advantages of the approach are the possibility of specialization and good adaptation of sales representatives.
However, where clients are widely dispersed geographically, this type of organization can be very expensive.
In general, organizing by product or customer type dramatically reduces the efficiency of sales team time, unless customer or product types are grouped by territory.
Regardless of which approach is used, the selling organization must take into account a number of important market factors.
Some customers deserve (and should receive) a higher level of service than others. It is imperative to take into account the nature of the market and the competition within it. In a growing market, the organization must be able to hire and train new salespeople to meet the growing demand. In a market with fierce competition, you can try to sell less intensively than in a market where there is an opportunity to increase your market share. The territories must be large enough in terms of sales potential and incentives for good sales performance, but small enough not to miss out on potentially important customers. In addition, not all salespeople are equal in competence and ability, the latter factor must be taken into account when hiring them.
Those involved in sales have two tasks: selling goods and caring for the buyer. It is of little use to be a salesman whom everyone loves but does not buy anything from. It’s not better to “crank out” a few sales, but leave your customers dissatisfied and discourage them from doing business with such a seller in the future.
In general, among sellers, according to their temperament and behavior, the following main types can be distinguished.
Bulldozers are those who care about only one thing - whether they will be able to take the top line in the ranking of their company's sellers. They act assertively and aggressively. In companies, they tend to push angry customers to the customer service department. “Bulldozers” do not care that the buyer may subsequently cancel the order or switch to competitors; it is important for them that the number of transactions they have concluded per week does not fall. Eventually, they exhaust the buyer resource in one area and move on to another organization.
Best friends are the diametric opposite of bulldozers. Buyers, as a rule, never have any complaints about them, but their sales level is low. This is not surprising, because in fact they are in sales “to communicate with people.” Even though these salespeople make a lot of calls, few of them result in a deal. For what? They communicate so nicely with customers and try not to “strain” them with requests to place an order. These people are always ready to assure their manager that their work is in full swing. As you might guess, buyers, as a rule, do not make deals with their “best friends”, but with their competitors from those who are not afraid to seek orders.
Receivers or, as they are often called in many trading companies, “lost souls”. They represent salespeople who have lost incentive and all interest in their work. They don’t really care whether the buyer likes them or not, they don’t bother themselves with careful preparation for the sale, and they don’t try to present their product or services in the best possible light. If the client himself wants to place an order, they will accept it, but if not, they will not lift a finger to get it.
Universal sellers. Most successful salespeople fall into this category. They are able to make a pleasant impression on the buyer, know how to ask questions and listen to answers, and present their product well. Buyers are pleased to deal with them, because they feel they are professionals. By communicating competently with customers, “universal sellers” do not hesitate to obtain orders from customers for their goods. They have the ability to constantly change their behavior, approaching one or the other of the above types of seller. Why? Yes, because there are different types of buyers. Sometimes the same buyer can behave differently at different times.
To simplify somewhat, we can distinguish several categories of buyers.
Steam rollers. What are they doing? “They’re coming.” Such buyers always know more about the product than the seller, they strive to convict you of incompetence and cling to words, they invariably try to reduce the price. They never listen to what you tell them. Why, because they already know everything better than you. They are annoyed by the very need to buy something. Oh, if only they could live without buying anything! Such clients are perhaps the most burdensome for sellers. You are tempted to put them in their place. But try to listen to them, be a “universal salesman”. Enter into negotiations without losing control of yourself, without giving in to the temptation to give up on everything.
Fickle. They have a hard time deciding to do anything, because it means taking responsibility. As soon as they place an order for a product, they immediately come to the conclusion that they can get it cheaper. This is one of the rare cases when delicate pressure on the client (the “bulldozer” aria) is justified. This way you will help him make a decision.
Offended by life. You will hardly be able to recognize this type when you first meet him. Only after they cancel their order several times will you begin to understand who you are dealing with. Their problem is that they are desperate to please anyone just like that, they experience an acute lack of communication. They will agree to whatever you suggest, but before you even get back to your office, they will call and tell you that they have changed their mind, because this will give them a reason to meet with you again. With them you should be a “best friend” or even a “receiver”; if you try to put pressure on them, you will again receive a refusal and say goodbye to them forever.
A salesperson's dream. This buyer will ask you questions and try to understand the qualities of the product being offered. Having concluded a deal, he will stick to his decision. You can relax. When working with such a client, the role of a “universal salesperson” will not take much of your effort.
Personal selling allows you to establish strong connections with manufacturers and consumers, respond more flexibly to market changes, and adapt to its requirements.
1.4. Product and personal selling
A product is not what the seller offers, but what the consumer expects from him.
Theodore Levitt
1.4.1. Product Marketing Factors
A product is anything that can satisfy a want or need and is offered to the market for the purpose of attracting attention, acquisition, use or consumption. These may be physical objects, services, persons, places, organizations and ideas. Services are goods offered for sale that consist of actions, benefits, or opportunities to satisfy a particular need.
The most widespread type of goods are consumer goods (purchased by consumers for personal use), this includes everyday goods (food, household chemicals, etc.), pre-selected goods (clothing, furniture, household appliances), and specialty goods ( branded goods with unique characteristics), goods of passive demand (products about which consumers know little). Already for pre-selection goods, organizations are developing proprietary sales technologies that help the sales consultant on the sales floor not only retain the buyer’s attention, but also motivate him to make a purchase.
Personal sales are even more important for promoting industrial goods that organizations purchase for further processing or use in production or economic activities. Capital goods include materials and components (raw materials, semi-finished products and parts), capital property (equipment, buildings and structures), auxiliary materials and services (business services). For this category of goods, personal selling is the most significant means of promotion. Knowledge of the properties, characteristics of the product - what marketers call the product's environment - allows the seller to determine which product outputs will be of key importance for the buyer in different situations.
When thinking about a product, we usually imagine a real object with material characteristics, for example, a microwave oven, a TV. But a product is something more than the totality of its material characteristics, and when talking about a product, one should always keep in mind its intangible qualities. For example, we may be talking about additional functions or a specific brand. That is, the description of a product is not limited to its main useful function (GPF) and material characteristics, it must contain the entire spectrum of its environment, Fig. 1.6.
Rice. 1.6. Product and its environment
In addition to the characteristics of a given product and its environment, the seller must know as much as possible about other products (equipment, services) presented not only in his organization, but also in the industry as a whole. The seller must be familiar with competitors' products as well as his own, otherwise his presentation of the competitive advantages of the product being sold will be unconvincing. The product knowledge model using the example of equipment for warehouse storage on racks is presented in Figure 1.7.
Thorough product knowledge is not only knowing what it is, but also (more importantly!) how it can meet customer needs and requirements. The term "characteristics" is used to describe a product. Some properties are tangible and obvious: design, test data, appearance, performance, components. Other properties are intangible, such as service support, the manufacturer's image, its financial position, copyright or patent. People don't buy features - they buy benefits that will provide them with benefits, but what do they mean to the customer?
Rice. 1.7. Product knowledge model
Advantages - the predominance of a set of positive characteristics (properties) of the product being sold over similar sets of competing products or substitute products available on the market. By “positive characteristics” we mean characteristics that are meaningful to consumers. Each characteristic that exceeds (from the consumer’s point of view) a similar characteristic of competing products brings him benefits.
Benefits are the values (personal or organizational) and meanings that consumers attach to the properties (characteristics) of a product or service. The concept of features and benefits is very important in personal selling. There are three categories of benefits: functional, symbolic and experiential.
Functional benefits usually correspond to properties directly associated with the product.
Symbolic benefits usually relate to characteristics indirectly associated with the product - they lie in the sphere of consumer needs (personal or organizational).
Experiential benefits are those that people experience when using a product or service. Arising on the basis of the consumer’s corresponding connections with the commodity and non-commodity properties of the product, they satisfy vital needs, such as sensory pleasure (sight, taste, sound, smell, other sensations), the need for variety, new stimulating information and sensations.
The advantages associated with the characteristics of the product itself are called rational advantages, the advantages in the field of service support are called service advantages, and are also very important, because most industrial products require not only delivery and installation, but also connection, personnel training, fine-tuning and control by the seller .
Statements in advertising materials about “excellent” service support are not enough; it is important to clarify what this service support is. Most organizations, large and small, consistently claim that they provide extensive warranties and comprehensive after-sales service. What does this mean? What exactly are the guarantees and for what? What is "after-sales service"? It is necessary not only to fully disclose these concepts to the client, but also to turn them into his advantages. A potential buyer must understand what advantages the seller’s guarantees give him, the list of which works includes after-sales service, after-sales support, only then can he turn from a potential buyer into a real one, then into a permanent one, and in the future into a loyal one.
When discussing the characteristics of a product or service and its benefits, salespeople often use linking phrases such as “what means...” or “what gives you...”. Most organizations, as well as their products, have many characteristics from which a number of advantages can be derived.
Let us list some components of the concept of “quality of goods (services)”, which can be translated into advantages and benefits that facilitate the purchasing process using speech techniques, Table. 1.2.
Table 1.2. Components of the concept of “quality of goods (services)”
|
Components of product quality |
Components of service quality |
|
Tangible: Power; Functional compliance; Additional functions; Aesthetics; Productivity; Intangibles: Compliance with norms and standards; Durability; Reliability; Service (pre-sale, warranty, after-sale); Perception (reputation, image); Trademark; Convenience; Saving |
Competence of the organization; Reliability of activity and commitment; Responsiveness and attentiveness of employees; Availability of communications; Quick understanding of client needs; Security of service (in legal, financial and moral terms); Availability of the organization's infrastructure; Service culture |
It is important for a sales manager to thoroughly know all the components of the product’s environment, because clients - consumers or purchasers of goods for production needs, when purchasing a product, first of all think about its benefits, i.e. about those qualities that potentially meet their requirements. It is important for the seller to know that when selling products, buyers are looking for solutions to their problems, and he must be able to determine which benefits of the product will be of key importance to the buyer.
Sales agents or sales managers selling industrial and high-tech consumer goods must develop and expand their product knowledge, which should include:
History of the creation of the product;
- research and product development;
- related production problems;
- manufacturing methods;
- methods of use;
- service maintenance .
In the personal selling market, the most important characteristics are those that determine the product’s ability to satisfy consumer needs. A buyer of industrial goods will naturally be more interested in the efficiency (coefficient of performance) of equipment, the performance of a power tool, than in its shape or color. Such characteristics are important to the buyer only after he understands what functional benefits the product provides.
Organizational buyers, when purchasing a particular product, seek to obtain some benefits that they do not currently have. It can be:
Saving time and money;
- saving labor costs;
- increased productivity;
- simplification of the production process;
- increased safety;
- increasing the value of their own products;
- increasing the possibility of selling their own products;
- best performance of products;
- increasing the reliability of products;
- reduction of operating costs and maintenance requirements;
- improving your reputation as a buyer.
All these benefits can vary in degree of importance, involvement, and, as a rule, one or several dominate. Therefore, you should determine the importance of each for each specific product sold.
Any two processes associated with sales are never exactly the same - many factors influence the sales process (type of product, buyer behavior, uniqueness of the commercial offer, presence of competing products, etc.). However, several general types of selling for large groups of products can be described to give some idea of the wide range of possibilities for using personal selling, depending on the type of product being sold and the specifics of the market.
1.4.2. Personal Selling Strategies
We can name the “three pillars” on which the presentation of the product during personal selling rests and which are reflected in the company’s selling standards.
1. Individualization of information about a product provided to a specific buyer (group of buyers), stimulating the purchase decision.
2. The ability to strengthen the organization's competitive advantage through personal selling.
3. Possibility of presentation of goods at the point of sale.
Ultimately, the behavior of the seller and the strategy he chooses to convey information are decisive when choosing a sales strategy. J. Burnet and S. Moriarty identify the following sales strategies: reciprocal selling, selling to sales representatives, missionary, technical, creative and consultative selling.
Resale. In reciprocal selling, the sales agent responds to customer demand. Travel and retail are two types of reciprocal sales. For example, drivers of organizations selling clean drinking water deliver coolers and water cylinders at the client’s request. Similarly, salespeople in hardware or clothing stores make sales when a customer asks them for help.
Sales to trade representatives. As with return selling, the sales agent primarily acts as an order taker, but his sales responsibilities are more service-oriented. Selling to resellers involves calling dealers, taking orders, making deliveries, setting up advertising displays and tracking inventory. This type of sales is often used in the food, textile, clothing and home improvement industries. Special tasks, such as setting up displays at points of sale and laying out advertising materials, are performed by this type of sales agent. Often such a sales agent plays a unifying role in maintaining relationships with trade representatives.
Missionary selling. A missionary sales agent does not usually collect orders. His main responsibility is to disseminate information about a new product before it goes on general sale. The classic example of a missionary sales agent is the sales representatives of drug retailers who, in one way or another, inform doctors about new drugs offered by pharmaceutical companies. Often, a missionary salesman will give doctors free samples of drugs so that doctors can not only recommend these drugs to patients, but also directly demonstrate the product itself. When a patient comes to the pharmacy, he will most likely buy the medicine that the doctor recommended and the packaging of which he remembered.
Technical sales. In this case, sales agents offer products, equipment and services that can solve customers' technical problems, based on initial expertise and their own experience in the field. Technical selling is commonly used for industrial goods such as machinery and industrial equipment. A salesperson's ability to identify, analyze and solve customer problems is key. Typically, a technical sales agent calls potential clients who have specific problems and offers his or her organization's services in finding possible solutions.
Creative selling. This type of sale typically refers to new products or existing products that are being introduced into a new market. The salesperson must convince potential customers that they have a serious problem or unmet need and that the product the salesperson is offering is the best solution to that situation. The sales agent acts as an “order distributor” who creates and stimulates demand for goods. Salespeople who work for companies like Procter & Gamble sell creatively. For example, a sales representative from P&G's health and beauty division might give a series of presentations to supermarket purchasing managers to demonstrate that the new Head and Shoulders shampoo meets consumer needs better than other comparable shampoos.
Consultative selling. This type of selling is a form of relationship marketing. The sales agent first meets with clients and informs them about possible areas of cooperation, creating the basis of the relationship. Then, with the help of leading questions, he clarifies the needs of clients. Only then does the sales agent offer his solution, accompanied by a presentation tailored to the client’s needs. During the subsequent discussion of the proposed solution, an agreed approach is developed, and then an order is issued. Once a transaction is completed, the sales agent provides after-sales support to bolster the sale itself, ensure customer satisfaction, and maintain good relationships.
The essence of consultative selling, as the most modern and in demand, is that the seller does not sell a product or service to the buyer, but advises the client, offers a way to solve a particular problem of the client using this product or service, i.e. The seller is not selling a computer with software to the client. but a technical solution to the communication problem. Consultative sales differ from traditional sales in a number of characteristics, table. 1.3.
Table 1.3. Comparative analysis of consulting and sales
So, consultative selling involves the following steps.
1. Creation of a client database based on secondary and primary marketing information.
2. Database research to determine optimal opportunities for increasing customer performance.
3. Development and demonstration to the client of a proposal for creating new opportunities.
4. Reaching agreement that the consultant has development opportunities for the client. Joint development of the initial proposal.
5. Presentation of a joint project proposal to the decision maker. Make a deal.
6. Assessing client satisfaction and developing further partnerships.
The product life cycle also has a huge impact on the choice of personal selling strategy and tactics. A new, unfamiliar product requires more time to make a purchase decision, which means that a sales agent must offer a potential client an advertising and information package that will help him receive accurate and comprehensive information (nowadays, this task has been significantly simplified, since such a package can be created modify and provide to the client in digital format).
If the product is at the stage of growth, the sales agent focuses on improved components, the presence of new unique characteristics that distinguish the product being sold from existing analogues on the market.
If the product is at the maturity stage, then in the presentation the sales agent can refer to the evidence of those who have been using this product for a long time and characterize it as reliable, economical, etc.
Practical advice
The concept of “product” also includes services. The main change that has affected this element of the “marketing mix” is the movement away from a physical, material product towards services and a special, invisible “information product”, or, as they also say, “from atoms to bits”.
The attention of marketing professionals should be focused on the following issues.
1. Will the nature of the product change?
2. What will this mean for buyers and marketers?
3. What will be the perception of the product, since the client expects, if not service, then, in any case, a fairly wide selection and high quality of the product?
4. To what extent is the customer’s satisfaction (or, conversely, dissatisfaction) due to the reliability, obvious quality of the purchased item, and to what extent - the impression directly from the sales process and from warranty and post-warranty service?
5. To paraphrase: what kind of experience - positive or negative - does the buyer acquire along the entire chain of “purchasing a thing - using it - repairing it”?
6. To what extent are the client’s perceptions that the purchased item will be useful specifically for him based on factual information about its technical characteristics?
7. To be a buyer, a client, is it a benefit, a pleasure, or rather a not-so-pleasant necessity?
G. Alder. Marketing of the future: dialogue of consciousnesses. - M.:
FAIR PRESS, 2003, p. 75
1.5. Buyer and his characteristics
It is common for a seller, like every person, to make mistakes, but it is not common for a buyer to forgive.
American business folklore
1.5.1. Buyer needs
Consumers are people, groups of people, as well as various organizations that use goods, services, and ideas. From a marketing point of view, consumers can be divided into two groups:
1) final consumers are individual buyers purchasing goods for personal (family, household) use;
2) organizational consumers are wholesale buyers who purchase goods for further processing or use (exploitation) in the process of producing their own products, as well as for resale.
The buyer (client) is the main object of marketing efforts. It is important for the marketing service of a trading organization to identify and analyze the needs and capabilities of the consumer, purchasing motives and methods of making purchasing decisions in order to develop effective marketing communications.
Consumer behavior is the activities directly related to the acquisition, consumption and transfer of products, services, ideas, including the decision-making processes that precede and follow these activities. The study of consumer behavior is the most important task in marketing, the solution of which allows the manufacturer (seller) to best allocate their resources to obtain maximum profits when selling goods and services. Knowledge of consumer behavior is the basis for making decisions in the field of advertising, sales promotion, public relations, and personal selling. It is no secret that rapidly changing consumer behavior requires new approaches and new strategies when selling goods and services.
Many customers have become more critical than before. They show more interest in their own benefits, more often ask about the purpose and disadvantages of the goods and services offered, show greater distrust, ask more questions, compare offers from different sellers, look for reliable criteria, take more into account factors affecting health, and trust advertising claims less.
Many clients have become more demanding. They prefer quality to quantity, want to receive professional and partner-like honest advice, buy different brands of identical products, take more into account the image, philosophy and goals of the trading organization, as well as the values professed by it, think about the status and reputation of the manufacturing enterprise.
The results of a survey among sales managers in Germany (the study was carried out by the consulting company BBE) indicate the following:
First of all, new, technically more advanced and more fashionable products are in demand;
- branded goods become a means of expressing individuality;
- the buyer pays more attention to the quality of goods and seeks qualified advice;
- emotions play an increasingly significant role - “how” becomes more important than “how much”;
- consumers pay more attention to environmental issues;
- different consumer groups form new subcultures.
Taken together, this suggests that consumer purchasing behavior is becoming increasingly unpredictable and volatile. Horst Schultz, President and Chairman of the Board of Directors of the Ritz-Carlton Hotel Company (the company is the winner of the Malcolm Baldrige National Quality Award) said about this: “Until your customers are 100% satisfied, just satisfied and delighted with what you do for them, you have something to strive for.”
To shape his influence on purchase criteria, the seller can apply the following steps:
1) identification of significant factors - it is necessary to determine those factors whose decision will satisfy the buyer;
2) determination of desirable factors - highlighting the client’s “fantasy” needs that are not included in the list of mandatory purchase criteria (essential factors);
3) highlighting the factors of preference for your organization - highlighting those characteristics for which your position is the strongest;
4) participation in the development of purchase criteria - it is very important that the buyer openly explains his purchase criteria and agrees to discuss them with you (this is an opportunity for the seller!);
5) constant monitoring of criteria - it is necessary to adequately respond to changes in criteria and promptly propose your own adjustments to these criteria;
6) presentation of a trade proposal that would meet the entire list of criteria as fully as possible;
7) tracking requirements - it is necessary to make changes and additions to your sales proposal after its presentation and discussion with the customer.
To summarize, a seller needs four types of buyer information to make a successful sale:
1) information about the buyer’s needs;
2) information about how your product satisfies these needs;
3) information about the mechanisms of purchase motivation;
4) information about the buyer's decision-making process.
You can only learn about the needs of your client, business partner or potential buyer by studying those who are making the purchase. From the passive salespeople of yesteryear, the modern sales manager is becoming an active researcher and creator of his organization's communication strategies. As an example, we can cite the following situation: a computer buyer satisfies completely different needs if he is a tea user, a university teacher, a designer, an animator, or a hacker.
When analyzing the factors of change in existing needs and the emergence of new needs, it is necessary to take into account that needs are divided into personal and industrial, and the dynamics of both are mainly characterized by the following indicators, table. 1.4.
Table 1.4. Factors influencing needs
|
Personal needs |
Production needs |
|
Health status Family status Income level Social status Changing the person's lifestyle Changes in the surrounding socio-economic environment |
Changing the scope of the organization Change in the organization's income Diversification of the organization's activities Changes in the raw materials situation Changing labor situation Changing energy situation Changes in the socio-economic environment |
The main features of the needs can be formulated as follows:
The nature of needs and the reasons for their changes are determined by the production activities of people and organizations;
- needs are of a social nature, i.e. the general range of needs and the forms of their specific satisfaction depend on the needs of the organization and society as a whole;
- the dialectical nature of needs is expressed in the ability to change (sometimes quite quickly), improve, and transform.
The most effective tool for identifying buyer needs is asking questions from the seller. The seller asks the buyer questions in order to achieve a certain reaction - a story about the needs, problems, current tasks and prospects of the organization.
For this purpose, several types of questions are used that help to get the interlocutor talking and establish a trusting relationship. For example, Harry Goodman divides questions into open, narrow, closed, leading, Fig. 1.8.
First, open-ended questions are asked that help the seller develop a further conversation and imagine the scale of activity of the buying organization. At the stage of collecting information, open questions are effective, allowing you to find out what the buyer has used in the past, what he is currently using, what he likes, what he doesn’t like, how he imagines his future. As a rule, the client willingly answers such questions.
Rice. 1.8. Sequence of questions to identify customer needs
For example, you can ask the client:
Has your company conducted market research before?
- Why are you sure that the decrease in sales volumes is due to ineffective advertising?
- Why did your company decide to conduct marketing research?
The right sequence of questions reveals the client and shows his needs.
Narrow questions already require more accurate answers; they allow you to extract specific information from the client, on the basis of which you can determine what exactly he needs. Narrow questions allow the buyer to quantify their unmet needs. By delving into the details at this stage of the conversation, the buyer himself can more fully understand the nature of his needs. For example, a seller, continuing the topic of marketing research, may ask: “What area of marketing research is most relevant for you today - researching consumer attitudes towards a brand, assessing brand loyalty or auditing your advertising activities?”
Closed questions require a clear yes or no answer. They are designed to get the client to say what he would like help with and what specific problems to solve. For example, “Will you prepare a technical specification for our agency, or will we prepare a marketing research project for you for further approval?”
Leading questions are intended to accurately indicate the terms of the contract and, as a rule, relate to project budgeting. You can directly ask the buyer: “How much do you expect to spend on marketing research? Knowing the approximate amount allocated by you, we will be able to more accurately draw up a marketing research plan and provide for the possibility of budget savings.” The client is faced with the need to correlate his need to increase the effectiveness of advertising activities and the size of the budget allocated for research.
Neil Reckman described the SPIN method of comprehensive client interviewing, which includes four types of questions asked to the client in a certain sequence. These questions focus the client on his problem and the possibility of solving it through the proposed product.
Situational: focusing on the situation. These are open questions aimed at clarifying the client’s general situation, indirectly related to the commercial offer.
Problematic: focusing on problems associated with a particular situation. These are questions that clarify the nature of the client’s specific problem in the current situation. Problematic questions help us get to the bottom of the client's specific problems and needs.
Extractive: Focusing on a specific problem related to your business proposition. These questions help to find out the actual size of the problem for the client, to find out how relevant the problem is for him. These are questions that will help you move on to presenting the features and benefits of your business proposal to the client. As a rule, this is a closed summary question constructed using an interrogative connective.
Guides: Focus on solving the problem through acceptance of your proposal.
The salesperson's job with this technique is to get the buyer to think. But the seller needs to think first - in order to correctly compose a sequence of four questions. Moreover, the seller must guess most of the answers in advance.
Asking a client questions using the SPIN method does not at all mean selling him his own problems. On the contrary, they help the client justify his own decision.
It is clear that by asking questions, the seller must receive answers to them, and it is not enough to just look carefully at the buyer, he must show a reaction to what is said. As a rule, active listening is accompanied by appropriate nonverbal behavior: you look at the interlocutor, your posture expresses attention, you are ready to write down and record the most important moments of the conversation, you nod your head and make sounds of approval.
Basic techniques for active listening are provided in practical tips.
Practical advice
Active Listening Techniques
Reception "Echo"
Verbatim repetition by the seller of the main points expressed by the client. The repetition of the client’s statement should be preceded by introductory phrases such as: “As far as I understand you...”, “Do you think that...”
Reception "Resume"
Reproduction of the essence of the client’s statements in a condensed and generalized form. In this case, you can use introductory phrases such as: “So, you are interested in...”, “The most important selection criteria are...”
Technique “Logical consequence”
The seller draws a logical consequence from the client's statements. For example, a salesperson tells a client: “Based on what you said, you are interested in increased warranty periods.”
Reception "Clarification"
You ask for clarification of certain provisions of the client’s statements. For example, a salesperson says to a client: “This is very interesting; could you clarify..."
S. Rebrik. Professional sales training. - M.: Eksmo, 2005, p. 47.
In conclusion, we will say that needs, naturally, can be very diverse, but they are all interconnected in one way or another, which allows them to be considered as an open integrated system that combines natural human needs, industrial and social needs.
Effective market behavior is possible only if a thorough analysis of the compliance of the product/service with the specific needs of the consumer or organization is possible.
1.5.2. Values of goods and customers
Value is a strong belief that some form of behavior or state is more preferable for a person and society than any other form. The study of human and organizational values focuses on the hierarchy of goals that a person or organization strives to achieve.
In the practice of personal selling, the value of the product must correspond to the values of consumers (buyers). The value of a product is its ability to satisfy any need (group of needs) of a person or organization.
Product values are classified as follows:
1) functional value is the perceived usefulness of a product due to its ability to play a functional or physical role;
2) social value is the perceived usefulness of a product due to association with a social group;
3) emotional value is the perceived usefulness of a product due to its ability to arouse positive feelings;
4) epistemic value is the perceived usefulness of a product due to its ability to arouse curiosity, create a sense of novelty and/or satisfy the desire for knowledge;
5) conditional value - goods acquire it in the presence of extraordinary or random physical and social situations that emphasize the functional or social significance of the product.
The values of individual or organizational consumers are closely related to needs and represent the physical (economic, production) or intellectual embodiment of needs. Values encourage people to strive to acquire certain goods and indicate appropriate ways to achieve their goals. The stability of values, their central position in the structure of an individual or an organization’s strategy, determined the use of value categories in the analysis of consumer behavior (of the final consumer or organizational buyers) - the choice of a product, brand, supplier of products or services.
Values can be personal and social.
Social values are beliefs, ideas, norms, priorities recognized by society (social group). Social values determine “normal” behavior within a society (group). Social values have a significant impact on the formation and modification of personal values.
Personal values are based on the needs of the individual and for the most part represent a choice from the value systems known to him. They define "normal" behavior from the individual's point of view.
The use of personal values to analyze consumer behavior involves their description, measurement, and modeling. The Rokeach value scale represents a spectrum of terminal and instrumental values. Rokech believed that values are associated both with goals (final, terminal states) and with ways to achieve these goals (instrumental components), table. 1.5.
Table 1.5. Rokech Value Scale (RSV)
These values are independent and can make a differentiated contribution to the market choice of the end consumer. However, they reflect individual values and can be practically used in the sales process to the final consumer.
Organizational and consumer values can be divided into total value (value of product, brand, service, personnel) and total value (value in financial costs, time, effort, operational value, psychological value), Fig. 1.9.
The value approach provides the market researcher with a framework for analyzing the value structure delivered to the individual or organizational buyer, which can be practically used in the personal selling process.
Rice. 1.9. Value system of the consumer and the organization
When making sales, a manager needs to know the set of values that guide the buyer in the process of making a purchasing decision.
1.5.3. Model of purchasing behavior of an organization
To some extent, organizational markets are similar to consumer markets. Both have people who play the role of buyers and make purchasing decisions to satisfy specific needs. However, organizational buying behavior differs from individual buying behavior in a number of characteristics due to the fact that the buyer here is an organization. These features must be taken into account when planning the personal selling process.
1. Demand for industrial goods is derivative - it is ultimately determined by the demand for consumer goods. Therefore, the demand for industrial goods is called secondary demand or derived demand. In order to increase demand in the organizational market, subjects of this market sometimes advertise their products directly on the consumer market.
2. The number of potential buyers in organizational markets is small, but purchase orders are large, i.e. a subject of an organizational market, in contrast to a subject of a consumer market, usually deals with a few but large buyers. In the market of large enterprises, it is enough to have only a few buyers to sell the bulk of the products.
3. Purpose of purchase. The products and services purchased must help the buyer achieve his goals. Manufacturers of goods and services strive to increase profits by reducing costs or increasing sales.
4. Purchase criteria. Organizational purchasing criteria are objective and explicit product attributes. Purchases are made on the basis of technical documentation, expert assessments and good knowledge of the product category.
5. Professionalism of buyers. Organizational shopping is done by professionals. Decisions are based on past experience and careful consideration of alternatives. Impulse purchases are rare.
6. Complex purchasing decision process. Organizational purchasing decisions are more complex and, accordingly, require more time, more extensive information exchange, as they are characterized by greater financial risk and uncertainty.
7. Group interaction during the sales process. Organizational purchasing involves a group purchasing decision. Decisions are usually made by a group of specialists and/or a group of professional purchasing agents. Decisions on complex and costly organizational purchases always involve multiple people with shared goals, risks, and knowledge/information. They form a buying (purchasing) center. Organizational buying involves close interaction between buyer and seller.
8. Professionalism of sellers. An organizational purchasing decision can involve intense negotiations, especially when organizations agree to buy from each other. Sales personnel play a key role in organizational selling because they negotiate small, large, and therefore highly significant transactions for both parties.
9. Post-purchase process. An organizational buyer usually expects more extensive post-purchase contacts than an individual buyer. Therefore, the factors of installation (installation, commissioning), service support of purchased equipment, quality assurance, compliance, etc. often play a significant role in purchasing negotiations.
Making an organizational purchasing decision requires the preliminary solution of a set of problems that are significantly more complex than the problems that arise when making an individual/household decision. Therefore, marketing activities in the organizational market are much more complex and complex.
In Fig. Figure 1.10 presents a model of organizational purchasing behavior. The core of the model is an analogue of the individual’s life style—the organizational style.
Rice. 1.10. Model of organizational buying behavior
Organizational style is the way an organization lives, reflecting and shaping its needs and attitudes that influence purchasing decisions. The differences in organizational styles can be quite significant. For example, public, commercial and government organizations have different goals, needs and organizational styles and solve their purchasing problems differently. Organizational styles change periodically due to growth, mergers or acquisitions.
Awareness of the problem. Awareness of the problem is influenced by individuals both within the buying center and those outside it. Awareness of the problem occurs in different ways. In high-tech, knowledge-intensive markets, the head of the department is most often aware of the problem. Therefore, it is important to keep in mind that those directly making the purchase (purchasing managers or, for example, training center program coordinators) are not the source of awareness of the problem.
It follows from this that contacting only the persons making the purchase is a mistake. In such markets, problem recognition and specification determination often occur without significant involvement of the purchasing staff themselves. Organizational buyers are always looking for ways to streamline their operations, but may not be aware of the challenges that impede such streamlining. The salesperson's job is to understand the client's needs and offer solutions to problems that the client himself has not yet realized.
Information search. Information search can be either formal (according to certain criteria) or informal. The informal part of the search may include a comparison of the image (fame, status) of organizations, a review of publications, and conversations with managers.
Evaluation of alternatives. Evaluating possible suppliers and selecting one often occurs in two stages. At the first stage, a list of possible suppliers is compiled: minimum requirements are established for each evaluation criterion and options are selected that meet these minimum requirements.
At the second stage of the solution, another rule is applied - separate, lexicographic, compensatory, elimination by aspects. For example, when applying a lexicographic rule, the criteria are ranked by importance and the option that is the best according to the most significant criterion is selected. As a result, one supplier is selected. The process of evaluating and selecting options is naturally complicated by the fact that different members of the buying center have different evaluation criteria.
Purchase. Once the decision to select a supplier is made, a decision is made on how and when the transaction will be paid for. This decision is important because it affects the execution of the delivery.
Use and post-purchase evaluation. If the use (operation) of the purchased product meets the stated criteria, then the post-purchase assessment for organizations is more formal than for individual buyers.
From the above it is clear that the organizational market is qualitatively different from the consumer market (however, we should not forget that organizational buyers are also consumers of ordinary goods and services, and although their behavior is influenced by the features of their work, they nevertheless remain just people with the same reactions to events as ordinary consumers). It was on the basis of the analysis of materials from organizational transactions that marketing relationships with consumers was recognized as a new and important marketing direction.
The organizational market has a number of significant features: there are fewer buyers (which contributes to the development of closer relationships), they, as a rule, buy goods in large quantities. Both parties are usually interested in establishing and maintaining constant contacts; for this purpose, all communication methods are used, for example, electronic data exchange systems allow the exchange of information in real time.
Sometimes buyers become business partners for suppliers. For example, some Japanese automobile companies send their engineers to component suppliers to jointly find ways to improve the quality and performance of these parts. They also use integrated computer systems that provide a mode of operation called “synchronized automation.” This is a further development of just-in-time methods, allowing the speed of the supplier's production lines to be coordinated with the operation of the buyer's equipment.
Organizational buyers are often more geographically concentrated than end users in the consumer market. The demand of such organizational buyers turns out to be more predictable. General trends in such a market can be shown using basic business-to-business purchasing models. Such markets typically have lower price elasticities than consumer markets.
Organizational buyers are more sensitive to the level of professionalism of representatives of the selling organization. Naturally, they themselves take a more rational approach to justifying the decision made. However, it should be kept in mind that organizational buyers are also influenced by emotions like any other buyer. In the end, they constantly risk their official position, because any serious mistake can greatly affect their professional and personal destiny. Therefore, they may become overly cautious and do everything to minimize the perceived risk, which can be easily achieved, for example, by purchasing only certain brands or interacting with already proven suppliers. They may also be uncritically guided by the opinions or preferences of their bosses. In addition, they may have personal preferences and likes that will influence the choice and nature of relationships with suppliers.
Due to the fact that when making an organizational purchase, a whole group of people participates in the decision-making process, several additional buying roles can be distinguished within this group:
Bosses are people who give permission for proposed actions;
- “gatekeepers” - people who can hinder or help gain access to decision makers (secretaries, telecom operators or purchasing agents);
- consultants are third-party experts who provide professional assessments.
The actual purchasing process may also differ from that in the consumer market. Here, there may be fewer intermediaries in the marketing channel and a more pronounced desire to buy directly from the main supplier of the product or service. Here, too, the expectation of reciprocity can be much stronger. For example, if a paper manufacturer contracts with a shipping company to deliver its products to customers, it may expect that company to purchase the paper products it needs from one of those customers.
The quality of service, level of reliability and adherence to delivery schedules also have a significant impact on the final result. Most often, organizational buyers show interest in a complex purchase (product + transportation + installation + personnel training + service). Therefore, understanding what the customer may need and in what form it should be delivered can be key in terms of the customer relationship.
As a rule, organizational buyers quite often purchase large quantities of the same type of product. So, like everyday consumers, they need ways to separate routine from non-routine transactions. The economic literature describes various ways to formalize the procurement process.
A regularly placed order is a repeat order without any modification. If you already supply products to a specific customer, your primary goal from a relationship marketing perspective is to make it easier for them to reorder. This creates opportunities for sales of related products (that complement the initial purchase) or for the sale of improved models of goods or services.
Changed reorder - when a consumer wishes to change supplier or change some aspect of the order, while the product or service itself is still needed. Changed repeat business is often the truest test of the quality of customer relationship marketing. A consumer with whom it was not possible to properly build a relationship will begin to consider options to switch to other suppliers.
A “new challenge” situation occurs when the consumer has no first-hand experience with a particular product or service. In this case, the consumer usually requires a lot of additional information, can turn to third parties for advice or expert assessment, and willingly listens to the opinions of friends and colleagues. In such a situation, the main task of marketing is to make a sale and establish a trusting relationship with the consumer, which is quite difficult. If you push too hard on the sale, your relationship with the consumer may deteriorate, perhaps by resisting your pressure the consumer will purchase another product or service. In table 1.6 describes the features of organizational purchasing behavior.
Table 1.6. Features of organizational purchasing behavior depending on the product and the level of risk
Lost customers can be divided into two categories. There are consumers you lost because you didn’t want to work with them. During the initial communication, it turned out that these consumers belong to the category of “bad” customers. So you chose a communication option that helped get rid of them. However, in many cases, consumers leave either due to the imperfection of goods (services) or due to errors in forming relationships with them. Especially in the second case, you can quickly eliminate errors and try to return such consumers.
Personal selling is becoming an increasingly flexible tool in the system of promoting goods and services and is turning into a new type of integrated communication: personal selling is integrated into corporate communication strategies for promotion.
Concluding our consideration of the general marketing principles of personal selling, we note that its personal nature determines the unique characteristics of both an economic and social phenomenon that ensures a direct connection between the manufacturer and consumers, and the seller with clients.
Practical advice
The most dangerous mistakes in sales
1. You turn selling into a one-way conversation.
2. You interrupt the client mid-sentence.
3. You do not show in any way that you are listening to the client.
4. You are not using intonation appropriately.
5. You finish his sentences for the client.
6. You are impatient to start talking yourself.
7. You start arguing with the client.
8. You don't pause.
9. You ask fewer questions than you should.
10. You try to control the situation too tightly.
11. You do not name the valuable qualities of the product in response to the client’s stated needs.
12. You do not recognize needs and talk about the merits of the product prematurely.
13. You make unsuccessful attempts to complete the deal: you do not catch the moment or choose the wrong way to conclude the deal.
S. Rebrik. Professional sales training. - M.: Eksmo, 2005, p. 78.
Chapter 2. Communication aspects of personal selling
2.1. Communication sales model
To lead people, follow them.
Selling their products uses various reminders, persuasion techniques, etc.
This influence got its name - promotion. One type of promotion is personal selling.
It is worth giving a clear definition of this concept. Personal or personal selling is the technique of verbally promoting a product during a conversation with a potential buyer. The ultimate goal of this type, of course, is for the client to make a purchase. In addition, this technique can provide favorable conditions for further sales of a certain product and will increase the effectiveness of feedback from customers.
Advantages and disadvantages
Personal selling is a very effective marketing technique. Compared to all other methods of promoting goods, they have certain characteristic features and
- direct contact between client and seller;
- interaction in the form of dialogues;
- the possibility of acquiring long-term cooperation between contacts;
- receiving effective feedback from clients;
- effectiveness of technology;
- the ability to obtain and accumulate marketing information about demand;
- relatively high unit costs;
However, it is worth noting that the power of this strategy is complemented by its high cost, which is not always affordable for selling companies.
In addition, the disadvantages of this method also include the limitation on the number of clients that the seller can accept. The fact is that representatives are not robots, so time and physical capabilities allow them to come into contact with a fairly small number of buyers. It is also worth saying that the company is not always honest with its customers regarding the qualities and characteristics of certain products, which can sometimes raise doubts among people who contact this company.
In certain cases, personal selling is most effective. Such cases include:
- sales stages at which emphasis must be placed on consumer benefits;
- sales processes large volumes supplied through direct channels;
- concentration of consumer composition in one territorial unit: district, region, etc.;
- in situations involving the sale of expensive and difficult-to-manage equipment, requiring clarification from the seller, presentation and any services provided after the transaction is concluded;
- new product sales cases who successfully completed the presentation;
- cases with sales of services and goods, which require changes during the transaction depending on the preferences of buyers;
Personal Selling Process Example
An example of a personal selling process can be seen at the work of a company. . Let's say that there is a certain company specializing in tourism services. The starting point of the personal selling process, of course, will be establishing contact with the client. Depending on how much the seller can interest and attract the buyer, the client himself will be open to communication.
1.The seller must be guided by a sense of morality, inspiration. A huge role is played by the enthusiasm of the representative of the travel company, his dynamism and energy. The salesperson must treat the company he represents in exactly the same light in which he wants the client to see it. The success of personal selling depends to a large extent on certain aspects of the physical plane. So in our case, a person who sells serious tourism services must look appropriate. Any little thing can confuse the buyer: unkempt hair, nails, unkempt clothes, an incorrectly tied tie.
2. The second stage of this process can be considered the identification of needs client directly during personal selling. Since researching the desires of buyers goes all the way to concluding a deal, a travel agency agent must pay a lot of attention to this. At this stage, it is important to consider several important aspects: behavior in interpersonal situations and listening skills.
3. Listening to customers is the most important thing. In this case, we are talking about the fact that the seller must not only be able to provide reasoned information, but also give the buyer the opportunity to speak out. When receiving a client, a travel agency representative should listen not passively (just pretending) and not selectively (separating only those points that interest the seller), but actively, paying attention to all the details and subtleties that the client will communicate. In a word, the prospects for concluding a deal depend on how competently the seller behaves when offering travel services.
4. The next stage is product presentation. Any representative must remember that the client will agree to conclude a transaction only if he receives sufficient information about this object. During the presentation, the seller needs to perform a number of tasks: attracting the client’s attention, awakening interest in a particular service and the desire to use the services of this particular travel agency. The seller’s qualities, such as the ability to speak and the ability to persuade, are also important here. A travel agency should not immediately provide any strong arguments; it is most logical to move from weak points to the strongest ones. In addition, the seller should under no circumstances put pressure on the client or try to somehow influence his choice.
5. Clients do not always make contact easily, objections on their part are very frequent, so the fourth stage of personal selling by a travel agency representative will be precisely the fight against objections. In order for the buyer to come to terms with his doubts, you can give him some arguments. In this case, you can compare this travel company with similar companies or agree to the client’s refutation and immediately give an argument that will give the buyer pause. There can be a lot of such methods.
6. Naturally, the ultimate goal is a successful transaction A. The buyer and seller do not always come to an agreement and immediately sign an agreement. In this case, you can also use a number of techniques. For this travel company, a good option would be to provide the client with several options, for example, hotels, which in the end will encourage him to choose one of them. Or you can refer to big discounts on some tours during this period. Thus, after weighing all the pros and cons, the client still agrees to sign the contract, so the deal can be considered successfully completed.
This is an example of the personal selling process in a travel agency. In this case, a contact between a seller and one buyer is presented.
I love learning everything new, interesting and unusual. And also - wrap yourself in a warm blanket, take hot cocoa and tell you about the latest in the financial market, hot stories from the offices of bank consultants and other interesting things.
Comments 0Table 1.1 - Comparative assessment of marketing concepts
At the stage production marketing concept , when the main attention was paid to increasing the volume of production of goods at optimal costs in order to obtain maximum profits, the functions of sellers were reduced to selling manufactured products at an approved price. In such a situation, sales occupied a priority position in the companies' marketing system, since the level of costs associated with sales of commercial products was significantly higher than the costs of performing marketing functions.
Stage sales orientation characterized by the desire to ensure maximum sales through advertising and other methods of influencing the buyer. The role of salespeople was to intensify commercial efforts in the sales process to persuade consumers to buy the products offered. Techniques used by sales representatives included exaggerating product features, criticizing competitors' products, using prepared presentations, and offering discounts to close the sale immediately. The calculation was made on the fact that consumers do not want to purchase goods except under pressure from the seller. Impressed by the smooth presentation, they will not regret their purchase. At this stage, sales take priority.
At marketing orientation Companies began to use coordinated strategies aimed at achieving the dual goals of customer satisfaction and profitable sales. At the same time, the functions of the companies' sales personnel were subordinated to meeting demand through targeted research of the market, goods and consumers, and the use of comprehensive methods of sales promotion. Here marketing occupies a dominant position, but there is a need to create an optimal ratio of marketing and sales.
At the same time, it should be noted that at the stage of traditional marketing, the main actions of marketers and sellers come down to identifying and quickly responding to emerging market needs. Marketing and sales act as a tool for responding to changes in the external environment. Therefore, their goal is to create a system for diagnosing the state of needs and a technology for responding to their changes.
Stage relationship orientation characterized by building long-term relationships between consumer and seller. However, any sale is not considered a separate transaction. Modern marketing and sales systems no longer respond so much to emerging needs, but rather create them themselves through the promotion and popularization of technologies for consuming goods. Sales representatives become consultants to their consumers, they teach them to receive satisfaction from consuming the product, focusing on the value and benefits that the product provides, thereby increasing the profitability of the consumer's activities. The effectiveness of the company's activities and development is already determined by the optimal ratio of marketing and sales.
The process by which relationships with customers are built to create mutual competitive advantages is called relationship marketing, or relationship sales .
Relationship marketing radically changes the role and importance of sales compared to traditional marketing:
1) sales are focused on assisting the buyer in formulating his needs;
2) during the sales process, the seller shows the buyer the value of the product offered, which can be both economic (for example, increasing profits) and psychological (for example, the purchase increases the consumer’s prestige);
3) sales are designed to find a solution to a problem that meets the needs of the buyer;
4) sales create the basis for long-term business relationships with the client.
As you can see, sales tools (goals, functions, tasks, etc.) are not isolated elements in the system of marketing tools; they stem from the general marketing concept and strategy. If, for example, a company is experiencing difficulties in selling products, then it first needs to check its marketing tools, determine how much they contribute to achieving sales goals, and assess the compliance of sales goals and objectives with the marketing strategy.
Analysis and evaluation of marketing tools in the field of sales (strategies, goals, exhibitions, advertising, sales promotion, logistics, service, etc.) allows not only to identify weak links in activities related to sales of commercial products, but also to develop new ideas for improving product distribution. Only then can you ensure that your sales efforts are consistent with, and not inconsistent with, other marketing efforts. Thus, we can conclude that marketing creates needs, and sales satisfies them.
In economic literature, the term “sale” is interpreted quite broadly:
1. process of product sales;
2. act of purchase of goods;
3. sales of products;
4. an exchange mechanism through which the needs and desires of consumers are satisfied;
4. part of the sales system aimed at establishing contact with the buyer and encouraging him to buy;
5. one of the methods of influencing potential clients in order to turn them into buyers.
Summarizing these statements, we can say that sales is a holistic set of activities for preparing, concluding a transaction and subsequently servicing the client in order to solve his significant problems and create long-term demand for the company's products.
Any sale is a process of satisfying the client's needs. When researching consumers, many experts take the point of view of the famous management scientist P. Drucker , according to which the true purpose of business is to create consumers. What this means is that the very survival and justification for the existence of an organization depends on its ability to find customers and satisfy their needs. At the same time, the success of sales depends on the sellers, their competence, goals and motivation. Their functions lie in the area of effective coordination of resources to achieve goals related to sales of commercial products.
The main tools that sellers use to make successful sales are product, price, assortment, service, product promotion and delivery channels.
From a product (service) point of view, selling is a system of convincing the buyer of the benefits that a given product or service can provide to the buyer if he makes a purchase. The buyer will make a purchase only if he understands these advantages. The seller's task is to convey to the buyer the benefits of the product.
The seller also influences the customer's attitude towards price. The client always matches price and value of the product (service). If the buyer does not identify such a correspondence, then he will not complete the transaction, so the seller must convince the buyer of the optimal ratio of price and value of the product.
Closely related to price is such a component as range products and services. The company can go in the direction of specializing the range or expanding it. With a wide range of products, the seller has less flexibility in pricing. With specialization, appropriate price discounts are possible. The seller’s task is to explain what benefits the assortment policy brings to the buyer and to what extent it allows him to satisfy his needs.
The effectiveness of a product does not always depend, for example, on the material, design or price. In many cases service plays an important role in making a decision to purchase a product. It is the service that guarantees the effective consumption of the product.
One of the key tasks that sellers solve is determining delivery channels goods to the consumer, i.e. how many stages the company creates between itself and the final buyer. Availability of the channel, convenience and cost-effectiveness of delivery is one of the criteria that determines the buyer’s actions in favor of this product.
Promotion of a product or service aims to make a timely commercial offer to the buyer, therefore, contacts with the buyer must be built on an ongoing basis. The frequency and volume of contacts determine the company's need for the number of salespeople.
A distinctive feature of sales in the relationship marketing system is their focus on creating added value for consumers. American experts (R.L. Spiro, W.J. Stenson, G.A. Rich) note that in modern conditions it is becoming increasingly difficult to develop and maintain competitive advantages that are based solely on the product. Most of these advantages are quickly copied by competitors, so companies are forced to focus their efforts on creating added value components to their product.
Value is what the customer is willing to pay for (value = benefits - their cost).
In most cases, as sales practice shows, the consumer makes a purchase only when he has a positive value for the product offer. If he refuses the deal, it means that the company’s sellers were unable to see for themselves and show the consumer the benefits that he will receive as a result of the transaction to purchase the company’s goods.
The system of values perceived by the buyer includes three types of values: the value of the product, the value of the company, and the value of the seller. Their criteria are presented in Table 1.2.
Table 1.2 - Criteria for a balanced value system
In order to increase sales efficiency, sellers, when communicating with a buyer, must first find out his attitude towards value. In this regard, there are three types of buyers: buyers of intrinsic value; extrinsic value buyers; buyers of strategic value (Figure 1.1).
Rice. 1.1 - Types of buyers in relation to value
Sales goals can be divided into quantitative and qualitative. Quantitative goals are sales-oriented. They can be formulated in various ways:
Achieving certain sales volumes;
Finding a certain number of new clients;
Carrying out sales with the optimal set of products, type of customers, territory, etc.;
Carrying out a certain number of visits;
Achieving a certain gross income.
Quality goals are based on sales communication capabilities. They are more relationship oriented and include:
Analysis of complaints;
Providing information and advice (consulting);
Assistance to wholesale buyers in further resale;
Informing clients about the ongoing marketing strategy;
Organization of cooperation with trade in the case of product promotion and launch.
In sales, the object of influence is the buyer, and knowledge of the marketing factors of personal selling (product factors and consumer factors) serves as the starting point for the development of sales technology, Fig. 1.2.
Rice. 1.2 - Marketing factors of personal selling
However, in real market conditions, the seller must respond flexibly to the behavior of a potential buyer, while showing the talent of a communicator, an experienced psychologist, and a presentation master. The fact is that the modern market is a market of active buyers, which presupposes active and professional sellers. The characteristic features of such a market are:
Similarity of goods and services;
Similarity of prices;
Similarity of design;
Narrow segmentation of the consumer market;
Excess of similar offers;
Fierce competition;
Remaining at the same level or partially decreasing demand;
Increased consumer demands for the quality of goods and services;
Increased buyer requirements for the qualifications of sellers.
In general, in the modern market, the critical attitude of the consumer towards products and companies is decisive. These factors not only increase competition in the industry, but also give special importance to the organization's communications with the marketing environment. Therefore, the organization’s sales policy should place special emphasis on building trusting and long-term relationships with customers and constantly taking into account their changing needs and desires.
Selling, as such, plays a vital role in the economic system. She:
Introduces innovations to the market;
Promotes consumption;
Conveys meaningful information;
Acts as a communication channel;
Helps solve buyer problems.
The real trend towards increased competition means that when selling, organizations must have:
The ability to identify what the buyer is doing;
The ability to bring together groups of products to form a business proposal;
Ability to sell to pre-prepared buyers;
Ability to improve sales technologies;
Ability to add value through professional service;
The ability to effectively use the advantages that their own products have over those of competitors;
An adequate strategy for managing sales specialists.
Buyer-focused selling is an advanced practice that requires the ability to accurately assess situations, make independent decisions, build long-term relationships, create conditions for mutual satisfaction and achieve a true business partnership.
In modern conditions, customer orientation is a consequence of the adoption of the concept of relationship marketing as the basic principle of the organization, built on four main premises.
1. The success of any organization in the market depends, first of all, on the consumer, on whether he wants to buy something and pay for the purchase.
2. The organization must be aware of customer needs, preferably long before production begins, and in the case of high-tech and capital-intensive industries, long before production is planned.
3. Customer needs must be constantly monitored and analyzed in such a way that the organization is always ahead of its competitors in terms of “product” and “market development”.
4. Senior managers must strive to integrate all components of the marketing strategy (i.e., the four Ps of the marketing mix: product improvement, pricing, product placement, and promotion) into a single strategic plan based on an understanding of consumer behavior.
Types and forms of personal selling
Personal selling can take many forms and types. Let us highlight the most significant classification features that are most often mentioned by specialists. It should be noted that a number of classifications are conditional, since at the present time (the age of technology) it is quite difficult to unambiguously classify some types of personal selling into any one group.
1. Depending on the way the seller’s relationship with buyers is organized, personal selling can take the following forms:
Contact between a seller and one buyer. Communication with a potential consumer in person (in a retail store, at the buyer’s home, in the office) or by telephone.
Contact between a seller and a group of buyers. Working with a group of potential buyers to make a sale or an organized mass offer. It is practiced in the sale of cosmetics, for example by Mary Kay Products, and household goods (Zepter). The seller's action plan is as follows. We are looking for a housewife who is willing to become the organizer of a party (Party-sale) or meetings with potential buyers “over a cup of tea.” The hostess invites acquaintances to her house, during a casual conversation the sales agent demonstrates samples of goods and talks about how to use them. Guests who are interested in the product can immediately purchase it or place an order. The owner receives a commission or the opportunity to buy the company's products at a discount. This form of personal selling also includes the work of a stand attendant at a company’s exposition at exhibitions and fairs.
Contact of the sales team with a group of buyer representatives. The sales team collaborates with the buying company's purchasing team. A characteristic form of organizing personal selling in the business market. When concluding a contract for the sale of expensive, technically complex goods, a large number of negotiators is advisable due to the need to promptly obtain advice from experts in various fields of activity.
Conducting conferences (trade meetings). Representatives of the selling company invite potential buyers and, while discussing buyers’ problems, demonstrate how they can be solved with the help of the company’s new products. Conferences can be held either through direct personal contact or via video communication (video conference). Conducting seminars. The company organizes an educational seminar for employees of purchasing companies, where new products are presented, their capabilities and progressive operating techniques are demonstrated. Moreover, the topic of the educational seminar is related to the client’s business, and not to the sale of the company’s goods. Thus, for example, the company “Consultant Plus” promotes computer programs for organizing a business.
2. Depending on who takes the initiative, a distinction is made between active and passive sales.
In the case of active sales, the sales representative takes the initiative. He finds a possible client and tries to sell him something, influencing the decision-making process. Active sales are especially typical for industrial markets.
In passive selling (also called receptive selling), the initiative is taken by the consumer. This form can often be found in the consumer market. Sometimes the consumer has already made a decision, and all that remains for the sales representative is to place and fulfill the order. This is approximately what happens in stores. Sometimes sales representatives have to influence the decision-making process. This happens when durable goods such as apartments, cars, etc. are purchased.
3. Depending on the nature of the trading situation and the corresponding tasks and functions of the seller, the following types of personal selling are distinguished.
Responsive selling is a type of personal selling in which the seller responds to existing customer demand (the client himself contacts the seller).
There are two categories of such sellers. The first ones are called order takers; their work area is existing clients. The main task is to quickly serve the buyer and maintain relationships with them. The second type - sales consultants - specialize in serving new clients. Their task is to assist the buyer in choosing a product (for example, when buying household appliances or clothing).
Varieties of reciprocal selling are retail trade, telephone sales with delivery. In retail sales to existing customers, the seller's functions are purely operational: accepting payment from the client, packaging and issuing the goods. When selling to new customers, additional functions will include information about the properties, purpose and benefits of the product during the presentation.
It is the responsibility of the delivery agent to take orders over the phone and deliver the goods to a specific location. Food and services are usually sold in this way. For example, sale of mineral water, air tickets.
In a reciprocal sale, although the seller has influence on the buyer, it is very limited. However, the seller’s personal behavior: politeness, speed, level of knowledge and reliability of order fulfillment can positively influence the sales result.
Missionary selling is a type of personal selling in which a salesperson creates demand for a new product before it becomes available to a potential buyer.
Missionary selling, like other types of personal selling that will be discussed later, requires activity on the part of the seller (the seller goes to the buyer). Salespeople engaged in missionary sales are called order initiators (presenters). Their task is not to conclude a deal, but to identify people whose opinions are important to the target segment, and convince them to assign or recommend the seller’s product to a potential client.
A classic example of missionary selling is the work of pharmaceutical sales representatives who meet with doctors, give them free samples of drugs and provide advice, but cannot make direct sales because doctors are not involved in purchasing drugs. However, the doctor can prescribe appropriate medications to his patients. Sellers who initiate orders are engaged in informing (educating) the consumer and forming a positive attitude towards the product.
Service selling is a type of personal selling that promotes goods in the market of intermediate sellers (retail and wholesale representatives). Such sellers are called merchandisers. The seller’s tasks include supporting sales in the trade sector and ensuring the presence of the company’s goods on the sales floor in the best places and in optimal quantities. The functions of merchandisers include receiving orders from intermediaries, delivering goods, recommendations for placing goods on the sales floor, consultations during the demonstration of samples, monitoring the level of inventory and maintaining contacts with the intermediary’s purchasing center.
Creative selling is a type of selling in which the salesperson seeks to obtain new business for a company by identifying new potential customers (people or organizations that have not previously purchased the company's products).
In creative selling, salespeople are called order distributors. Their task is to stimulate demand for a new product. The role of salespeople is to convince potential customers that they have an unmet need and that the product the salesperson offers is the best solution for that situation. Creative selling is usually accompanied by a demonstration of the product in action so that the potential client can be convinced that the proposed product meets his purchasing needs better than competitors' products.
Such sales are used by companies producing goods for both industrial and consumer purposes. This type of sale is relevant when a company enters a new market.
Consultative selling is a type of personal selling, during which the buyer is offered a systematic solution to the problem that has arisen in the hope of establishing a long-term mutually beneficial relationship with him. In consultative selling, the seller’s task is to determine areas of cooperation with the client for the development of further contacts. Sales organizers (sales consultants) are responsible for building and maintaining relationships with promising clients. The functions of this type of salesperson are to diagnose the individual needs of the client, identify problems, offer a comprehensive solution to the problem, and provide a high level of after-sales service. This is the most creative type of personal selling, but also the most difficult. In order to offer the client a systematic solution to the problem, a combination of knowledge from several sellers is necessary. Therefore, in world practice, the organization of teams to service large clients (marketing teams) has become the norm. Marketing teams include product and financial experts alongside salespeople. Because of their training, these professionals have the authority to set prices, develop product specifications, and determine delivery dates in negotiations with the buyer.
Consultative sales are actively used by companies working with corporate clients. For example, Xerox switched to consultative sales to ensure its competitiveness. To be able to offer systems solutions, Xerox created service teams for the company's largest customers (such as the federal government) to ensure the smooth functioning of their interconnected computer systems.
There are three types of personal selling.
Order taking is the processing of routine or repeat orders for products or services that a business has already sold. Here the main task is to maintain and improve business relationships with regular customers, assigning them to the company. This type of personal selling occurs in the case of transactions with simple products or services that are sold at reasonable prices and are not technically or technologically complex.
Receiving orders - identifying promising buyers, providing them with information in order to convince them of the need to purchase a product or service, increasing sales volumes. This type of personal selling takes place in the sales processes of technically complex products, which also require accompanying services.
Sales support - identification of promising buyers, analysis and solution of their problems through the promotion of new products. This type of personal selling is carried out using special sales agents - personal sellers.
Thus, the functions of the seller depend on the tasks assigned to him. In some situations, they are limited to a narrow set of operations, but in most cases, to ensure successful sales of products, sales personnel need to perform a full range of functions. Moreover, a significant part of the seller’s time (with the exception of reciprocal sales) is spent outside of contact with the buyer. Experts believe that to ensure high efficiency of a company's sales service, its employees should devote 50% (or more) of their time to the sales process itself.
Sales are the basis of any business. Sales are needed by all companies without exception, regardless of the area of activity and the types of products sold. The eternal question of how to increase sales and make more profits worries all entrepreneurs without exception. Obviously, to earn more, you need to sell more. Direct sales are one of the good ones.
What is direct sales? This is a type of sales in which the seller contacts directly with the buyer, without the participation of intermediaries and third parties. Such sales are also called personal selling. Most often, sales take place outside of stationary places of trade such as large stores, but in the office or home of the client. A seller engaged in this type of trading is most often called a distributor or sales representative.
This type of sales is most often used for the sale of cosmetics, household chemicals, dietary supplements, etc. The most popular companies using direct sales techniques:
- MaryKay
- Amway
- Herbalife
Let's look at the simplest example of direct sales; most likely, you have encountered it many times.
Imagine that you are walking down the street. A girl comes up to you and invites you to familiarize yourself with and test a new line of cosmetics. She immediately makes a presentation of the product, talks about its properties and advantages. Most likely, she will immediately let you test the product. It’s up to you to decide whether to buy it or not, but the outcome largely depends on the seller’s presentation.
Direct and indirect sales: the main differences
Application in network marketing
Many people think that these two definitions mean the same thing. Most experts say this is partly true: network marketing is part of the direct selling concept. How are they different? First of all, the conditions for the seller.
In direct sales, the seller's income is often higher than in a network business. Profit comes from sales, and not from attracting new sellers. There is an income limit, but despite this, direct sales are a good tool for making quick profits. This method is usually used to sell durable goods, for example, dishes, accessories, household items, etc.
In network marketing, sales happen the same way, but the first buyers are often people from the seller’s close circle. In this case, the seller receives lower commissions and his main income comes in the form of bonuses for attracting new sellers. Most often, cosmetics, household chemicals, vitamins, etc. are sold this way. The seller receives regular income if he managed to make his client permanent. The main feature of the network is that the seller receives income not only from sales to the client and bonuses for attracted sellers, but also a percentage of the sales that are made by the sellers he attracts. This process is endless, and if you do it regularly, you can significantly increase your income.
Another feature of a network business is that it is easier to start working here. Business does not require investments or purchases of products, and you can acquire the necessary knowledge in a fairly short period of time. Each person creates a network of his own sellers (hence the name “network”), which provide constant profit without direct participation in the sales process.
Types of direct sales
There are many types of direct selling in which the consumer of the service or product is the final buyer.
Direct sales by apartment
This method has become less popular in recent years as its profitability has dropped significantly - people have become less trusting and often do not open the door to strangers. This is one of the most difficult methods of “cold selling”, which has recently been used less and less due to the bad reputation imposed by deceivers and scammers.
Direct sales on the street
Sales that take place in the common space, i.e. on the street, are still active and thriving. Most often, such a retail outlet is a table with a demonstration of products or an information stand. Such sellers do an excellent job and attract interested passersby. Very often, this scheme is used for the direct sale of cosmetics and household goods.
Direct sales of services and products are often carried out over the telephone; they are called distance selling.
B2B and B2C sales
Unlike selling to consumers (B2C), selling direct to businesses (B2B) can be an excellent tool for increasing profits, attracting new clients and developing professional contacts.
The client’s behavior also differs: when searching for a product, in most cases, the client acts independently, but when looking for a service, he looks for information and reviews from friends and on the Internet. To sell services, you need to be confident in their quality, and deeper training of sellers is also required.
Advantages and disadvantages
Personal selling is considered the most effective compared to other sales methods because a relationship with the client is immediately established and a lot of additional information can be obtained:
- the reaction to the seller and the client’s attitude to the offer, reaction to phrases during the conversation are immediately visible.
- With personal contact, you can predict the ending of the conversation and the development of events; also, with direct sales, it is much easier to establish contact with the buyer and even get a regular client in his person
- Feedback: if the sale did not happen, you can immediately ask about the reasons: such feedback can become important information that will be aimed at improving the company.
Why is direct selling better? The reason is that the human factor plays a major role here. A lot depends on the seller: his approach, decent presentation of the product and recommendations for use. Charisma also plays an important role. It is important to interest a person, show him how your product will be useful and how it can solve his problem. In addition, you need to know the features of your product well in order to answer all possible questions from the buyer. A seller who doesn't know what he's selling can be suspicious. What kind of purchase can we talk about in this case?
Let's look at the pros and cons of direct sales for sellers in the table:
| Benefits for the seller | Disadvantages for the seller |
| Direct contact (including by phone). The seller sees the buyer’s reaction and can adjust the communication in the right direction | High cost of contact. This means that a visit to a consumer includes the costs of recruiting a seller, his training, his salary, his transportation and travel expenses. Reaching large audiences through personal selling can be expensive |
| Individual approach to every customer | Audience coverage is limited by the high cost of this type of sales. This makes it difficult to reach a large number of potential buyers. |
| Personal presentation of the product, description of its best qualities and the need for purchase for each individual consumer | Different sellers may have different interpretations of the information they need to convey to the buyer. This makes it difficult to convey a single, cohesive message to all consumers. |
| Targeting a specific market and consumer | |
| An effective element of marketing communications | |
| Opportunity to get higher profits |
The advantages for companies include cheaper personnel who can be trained in the specifics of sales and no need to maintain an expensive offline point.
Pros and cons for the client
As for buyers, for them the advantages of purchasing through direct sales significantly outweigh the disadvantages:
| Benefits for the client | Disadvantages for the client |
| Convenience. The seller will come to you and demonstrate the product at a time convenient for you. | Intrusiveness of sellers |
| It is possible to obtain the most comprehensive information from a company representative | Doubts about the quality of the product |
| The price may be lower due to the absence of an intermediary in the sales chain | |
| When selling directly, you can often test the product for free | |
| Regulation – legislation protects the buyer and also applies to direct sales |
Research has shown how effective various sales channels are:
- advertising publications - 5-7% of clients;
- mailing - 10-25% of clients;
- direct sales - up to 70% of clients.
This study clearly shows why direct selling works better than advertising.
Direct sales technique. How to learn to sell?
If you really want to, you can quickly master the technique of direct sales and learn how to sell. First, you need to understand how your product will be useful to a specific person.
Consider the example of selling a flower vase. Its features are its round shape, 2-liter volume, and it is made of plexiglass.
Who could use such a vase?
Restaurant or cafe for hall decoration;
A girl or woman (there are never too many vases, one way or another everyone is given flowers);
For lovers of bamboo (it is usually grown in water, without soil, and looks especially impressive in transparent containers);
For photographers and bloggers as a decorative element that will look great in photos.
First of all, you need to find out from the person what exactly he needs, and present your product from that perspective.
To ensure that your product presentation is successful and leads to a sale, adhere to the following rules:
- Greetings. People often meet people based on their clothes, so it’s important to make the right first impression. Pleasant appearance, neatness, friendliness and positivity perfectly endear you and evoke positive emotions from the first words.
- Product presentation. The first rule also applies here. In addition, try to interest your potential buyer as much as possible and instill in him trust in you and your product.
- People do not buy a product, but emotions, so 95% of success depends on your presentation. To prepare for and deliver a successful presentation, you need to have a thorough knowledge of the characteristics and properties of your product. On the eve of the presentation, make a draft with a plan and practice the story several times, or even better, speak in front of someone you trust and work on your mistakes together.
- A gentle introduction to the price.
- Deal. When the money is received, it is important to remain friendly so that the client does not feel that you have immediately lost interest in him. Do not ignore this rule, because you may lose the opportunity to make this client a permanent one! Let the client feel joy that he bought from you.
At the very end we want to add a few “unwritten rules” of a good seller:
- The client is a living person.
- Sell yourself first, and then the product.
- The client says more. Give him the right to speak, so you will better understand his motivation.
- Reinforce all product characteristics by indicating their benefits for a specific client.
- Nothing is impossible for a good seller - to satisfy some of the client’s whims, you can offer him to pay extra, instead of immediately refusing and losing the client.
- Describe the product clearly, illustrate the benefits that the client will receive if he buys the product, or vice versa, how disappointed he will be if he does not buy.
- The customer is always right. If he has his own opinion that is different from yours, you should not convince him or argue. Your main goal is to sell the client a solution to their problem.
- Talk directly to the person who will be making the purchasing decision (for B2B). Otherwise, you simply risk wasting your time.
- If you see interest from the client, you need to smoothly move on to the price. The best solution is to name the price range, or warn that the price will be known after an individual calculation.
- At every meeting with a client, agree on your next step and further actions so that your deal does not hang in the air.
Direct selling is a great tool for increasing profits. But it should be remembered that direct sales in themselves are not enough, it is necessary to engage in the return and retention of customers, such modern and relatively inexpensive tools as will help with this.
Loading...