Chapter 2-3 Summary PDF

GROUP 5 (FIRST REPORTERS) SUMMARY OF CHAPTER 2 AND 3 PROFESSIONAL SALESMANSHIP CHAPTER 2 BUILDING TRUST (DEVELOPING TRUST) Motivation Excellence Inc. (MEI) - is a full service performance improvement company that specialize...

GROUP 5 (FIRST REPORTERS) SUMMARY OF CHAPTER 2 AND 3 PROFESSIONAL SALESMANSHIP CHAPTER 2 BUILDING TRUST (DEVELOPING TRUST) Motivation Excellence Inc. (MEI) - is a full service performance improvement company that specializes in highly creative and results-oriented incentive systems. The company was founded by Greg Lewis in 1985 and is dedicated to the high- est standards of integrity, mutual respect. and trust and to creating an environment that provides unparalleled client service while building client relationships into long-lasting partnerships. Jim Micklos (senior account executive with MEI) spends anywhere from several months to several years developing the respect of his clients and prospects. two key documents to obtain the crucial information required: - Mutual Confidentiality Agreement - Program Design Questions WHAT IS TRUST? - "The essence of trust is that the industrial buyer believes that he can rely on what the salesperson says or promises to do in a situation where the buyer is dependent upon the salesperson's honesty and reliability. " WHY TRUST IS IMPORTANT? In today's increasingly competitive marketplace, buyers typically find themselves inundated with choices regarding both products and suppliers. The skills and activities inherent to relationship selling can be classified according to their purpose as: 1. initiation of the relationship 2. development of the relationship 3. enhancement of the relationship HOW TO EARN TRUST Trust is critically important to any relationship. Several Variables are critical in helping salespeople earn a buyer’s trust: Expertise Inexperience - is a difficult thing for a young salesperson to overcome. Most recent college graduates will not have the expertise to be immediately successful, especially in industrial sales. Dependability - centers on the predictability of the salesperson’s action Candor - deals with the honesty of the spoken word. Customer Orientation - means placing as much emphasis on the customer’s interests as your own. Compatibility/Likability - Customers generally like to deal with sales representatives whom they know, they like, and they can feel a bond with. KNOWLEDGE BASES Industry knowledge - refers to a comprehensive understanding of a specific sector or field within the economy. Company knowledge - pertains to an in-depth understanding of a specific organization within an industry. Product knowledge - refers to a deep understanding and familiarity with a company’s products or services.  Service knowledge - refers to the comprehensive understanding and expertise that a company or its employees possess regarding the services they offer. Service superiority - refers to the exceptional quality of service that a company provides compared to its competitors. Promotion & Price - this refers to the various activities and strategies that businesses use to communicate with their target audience about their products or services. Market & Customer Knowledge - refers to the comprehensive understanding of the market environment in which a business operates. Competitor knowledge - refers to the understanding of your competitors’ strengths, weaknesses, strategies, and market positions. Technological knowledge - refers to the understanding and expertise related to the design, development, and application of technology. SALES ETHICS Ethics - refers to right and wrong conduct of individuals and institutions of which they are a part. Ethical standards for a profession are based on society’s standards, and most industries have developed a code of behaviors that are compatible with society’s standards. Code of Ethics * Responsibilities of the Marketer * Honesty and Fairness * Rights and Duties of Parties in the Marketing Exchange Process * Organizational Relationships Image of Salespeople ||> Sales and Marketing Executives International (SMEI) has been concerned with the image of salespeople and has developed a code of ethics as a set of principles that outline the minimum requirements for professional conduct. A study of how salespeople are portrayed in the popular press found that salespeople are often associated with deceptive, illegal, and non-customer-oriented behavior. Deceptive practices: Salespeople giving answers they do not know,exaggerating product benefits, and withholding information may appear to only shade the truth, but when it causes harm to the buyer, the salesperson has jeopardized future dealings with the buyer. Illegal Activities: Misusing company assets has been along-standing problem for many sales organizations. Using the company car for personal use, charging expenses that did not occur, and selling samples for income are examples of misusing company assets. Non-customer-oriented behavior: Most buyers will not buy from salespeople who are pushy and practice the hard sell. Too much is at stake to fall for the fast-talking, high-pressure salesperson. CHAPTER 3 UNDERSTANDING THE BUYERS Cole Proper, Director of Business Development at AFFINA, AFFINA’s services include customer service support, inbound sales and order taking, fulfillment, research, and marketing. He leverages deep knowledge of AFFINA’s services and a commitment to understanding diverse buyer needs. Proper’s approach is exemplified by his work with a growing wireless company, where he navigated a complex sales cycle marked by organizational change. Despite shifts in decision makers and internal challenges, Proper’s adaptability and strategic insight led to a successful partnership, showcasing his ability to meet varied goals and deliver maximum value.  Proper emphasizes that salespeople must understand the goals of each decision maker in order to provide optimal solutions. Proper’s selling experience underscores that the sales process is often disrupted—unexpectedly and beyond the control of the salesperson. Many times the reasons for disruption are not risks identified by the sales team. This illustrates the critical importance of understanding your buyers and being flexible when opportunities shift direction. To be successful in implementing your solution, focus on understanding the reasons why each decision maker wants resolution. You must understand the personal goals as well as the organizational goals that will be achieved once the challenges are eliminated. TYPES OF BUYERS Buyer Categories: Consumer Markets: Individuals buying for personal use, influenced by peer behavior, aesthetics, and personal taste. Business Markets: Firms, institutions, and governments buying goods and services for operations or resale, focusing on overall value. Characteristics of Business Markets 1. Concentrated Demand: Few large buyers make up most of the purchases. 2. Derived Demand: Business demand depends on consumer demand for related products. 3. Higher Demand Fluctuation: Business market demand is more volatile than consumer market demand. 4. Purchasing Professionals: Buyers are trained and make rational, informed decisions. 5. Multiple Buying Influences: Purchase decisions involve various team members with different roles. 6. Close Buyer-Seller Relationships: Increased interaction and long-term relationships between buyers and sellers. THE BUYING PROCESS The buying process refers to the steps a consumer goes through when deciding to purchase a product or service. It can be broken down into several stages: PROBLEM/NEED RECOGNITION: The process starts when a consumer identifies a problem or need. This could be a physical need (e.g., hunger) or an emotional or social one (e.g., the desire for status or entertainment). INFORMATION SEARCH: Once the need is recognized, the consumer seeks out information on how to satisfy it. This can involve looking at advertisements, talking to friends, researching online, or visiting stores. EVALUATION OF ALTERNATIVES: At this stage, the consumer compares different products or services that could fulfill their need. They evaluate based on price, features, reviews, and brand reputation. PURCHASE DECISION: After evaluating alternatives, the consumer makes a decision on what to buy. Factors like availability, promotions, or personal preferences can influence this choice. PURCHASE: The consumer completes the transaction by purchasing the product or service. This can happen in-store, online, or through other channels. POST-PURCHASE BEHAVIOR: After the purchase, the consumer reflects on their decision. They may experience satisfaction (leading to brand loyalty) or dissatisfaction (possibly resulting in returns or complaints). These stages help businesses understand consumer  behavior and tailor their marketing strategies to guide potential customers effectively through the process. TYPES OF PURCHASING DECISIONS Buyers are learners in that purchase decisions are not isolated behaviors. Three Types of Buying Decisions: Straight Rebuys - is often the result of a long-term purchase agreement.Needs have been predetermined with the corresponding specifications. Straight rebuy decisions present a major challenge to the out-salesperson.Buyers are satisfied with the products and services from current suppliers and see no need to change. Two strategy choices. 1. First, they can continue to make contact with the buyer so that when there is a change in the buying situation or if the current supplier makes a mistake, they are there to respond. 2. Second, they can provide information and evidence relevant to either the desired or actual states so that the buyer will perceive a needs gap. Modified Rebuys - The buyer has experience in purchasing the product in the past but is interested in acquiring additional information regarding alternative products and/or suppliers. New Task - occurs when the buyer is purchasing a product or service for the first time. Selling Strategies for New Task Decision: 1. First, the salesperson can provide expertise in fully developing and understanding the need. 2. The salesperson’s extensive experience and base of knowledge is also valuable to the buyer in terms of specifying and evaluating potential solutions. 3. Finally, top salespeople will assist the buyer in making a purchase decision and provide extensive follow-up to ensure long-term satisfaction. By implementing this type of a consultative strategy, the salesperson establishes a relationship with the buyer and gains considerable competitive advantage. UNDERSTANDING COMMUNICATION STYLES Verbal and nonverbal messages can also provide salespeople with important cues regarding buyers’ personalities and communication styles. Experienced salespeople emphasize the importance of reading and responding to customer communication styles. Effectively sensing and interpreting customers’ communication styles allows salespeople to adapt their own interaction behaviors in a way that facilitates buyer– seller communication and enhances relationship formation Comparison of the Principal Characteristics of Assertiveness and Responsiveness Slow-Paced Cooperative Avoids Taking Risks Supportive Team Player Nondirective Easygoing Reserved in Expressing Opinions Fast-Paced  Competitive Takes Risks Takes Charge Independent Directive Confrontational Forcefully Expresses Opinions Task-Oriented Guarded and Cool Rational Meticulous Organizer Inflexible Regarding Time Controlled Gesturing Nondirective Formal Relationship-Oriented Open and Warm Emotional Unorganized Flexible Regarding Time Highly Animated Spontaneous Informal Assertiveness—Assertiveness refers to the degree to which a person holds opinions about issues and attempts to dominate or control situations by directing the thoughts and actions of others. Highly-assertive individuals tend to be fastpaced, opinionated, and quick to speak out and take confrontational positions. Low-assertive individuals tend to exhibit a slower pace. They typically hold back, let others take charge, and are slow and deliberate in their communication and actions. Responsiveness—Responsiveness points to the level of feelings and sociability an individual openly displays. Highly-responsive individuals are relationship-oriented and openly emotional. They readily express their feelings and tend to be personable, friendly, and informal. However, low-responsive individuals tend to be task-oriented and very controlled in their display of emotions. They tend to be impersonal in dealing with others, with an emphasis on formality and self-discipline. Communication Styles Matrix Analyticals- are characterized as being low on assertiveness as well as responsiveness. Amiables—Developing and maintaining close personal relationships is important to amiables. Easygoing and cooperative, they are often characterized as friendly backslappers due to their preference for belonging to groups and their sincere interest in other people—their hobbies, interests, families, and mutual friends. Expressives- are animated and highly communicative. Although very competitive by nature, they also exhibit warm personalities and value building close relationships with others. In fact, they dislike being alone and readily seek out others. Expressives are extroverted and are highly uninhibited in their communication. When confronted or crossed, they will attack. Drivers—Sometimes referred to as the director or dictator style, drivers are hard and detached from their relationships with others. Described as being cool, tough, and competitive in their relationships, drivers are independent and willing to run over others to get their preferred results. As they seek out and openly demonstrate power and control over people and situations, they are difficult to get close to and appear to treat people as things.  MASTERING COMMUNICATION STYLE FLEXING -In addition to sensing and interpreting the customer’s communication style, salespeople must also be aware of his or her own personal style. Mismatched and possibly clashing styles can be dysfunctional and present significant barriers to communication and relationship building MULTIPLE BUYING INFLUENCES A single individual typically makes routine purchase decisions such as straight rebuys and simpler modified rebuys. However, the more complex modified rebuy and new task purchase decisions often involve the joint decisions of multiple participants within a buying center or team. Buying teams (also referred to as buying centers) incorporate the expertise and multiple buying influences of people from different departments throughout the organization. Buying team members are described in terms of their Roles and Responsibilities within the team: 1. Initiators —Initiators are individuals within the organization who identify a need or perhaps realize that the acquisition of a product might solve a need or problem. 2. Influencers —Individuals who guide the decision process by making recommen- dations and expressing preferences are referred to as influencers. 3. Users —Users are the individuals within the organization who will actually use the product being purchased. 4. Deciders —The ultimate responsibility for determining which product or service will be purchased rests with the role of deciders. 5. Purchasers —Purchasers have the responsibility for negotiating final terms of purchase with suppliers and executing the actual purchase or acquisition. 6. Gatekeepers —Members who are in the position to control the flow of information to and between vendors and other buying center members are referred to as gatekeepers.