Chapter

Personal Selling

Introduction
Some important aspects of personal selling are: 1. It enhances customers confidence in the seller.

2.
3. 4.

It promotes long-term business relations through personal intimacy.

It provides a human touch to business transactions. It helps facilitate the seller to understand each customers needs and preferences more clearly.

5.
6.

It helps satisfy a customer by modifying the product as per the customers choice and preference.
Personal selling followed by personal service helps build long-term relations between the business and the customer.

7.

It helps keep up with the competition in the market, based on product Cont. customisation as per customers preferences.

8.

It is a powerful and effective tool for convincing the customer about the product.

9.

Through personal selling the time lag between introducing a product through the media and actually selling it is reduced.

10. It provides prospective customers with a better understanding of the product and an interactive opportunity to liaise with the sales personnel.

Objectives of Personal Selling

Personal selling objectives may be: Short-term Short-term personal selling objectives are more specific and of short-term duration. These objectives change very frequently as soon as there is change in production mix. Further, they are usually quantitative objectives. Long-term

Long-term personal selling objectives are broad and general. There is very little
scope of change in long-term objectives. They are usually quantitative objectives.

Functions of Personal Selling

Personal selling is an oral presentation in face to face conversation with one or
more prospective customers for the purpose of making sales. The main functions of personal selling are as follows: 1. Provide service to customers (Introduce the product, explain the right use, Convince them etc.) 2. 3. To sell the product Maintain the sales record

4.
5. 6.

Executive Function
Develop goodwill Achieve sales target

Changing Face of Personal Selling

Modern sales approach is based on the following parameters 1. 2. Value Sharing: Salespeople study the changing needs and preferences of their customers. Relation Building: A value-based relationship helps the salespeople to constantly mobilise resources and modify the end product by catering to the specifics of the buyer. Role Playing: The salespeople, in personal selling, go far beyond realising sales. Sales people act as consultants to their prospective customers constantly advising them of new products, their updates and impart knowledge to them. Changing Approach: Personal selling comes in a package containing the inputs of the experts from different areas such as maintenance, installation, trouble shooting, delivery staff, sales personnel, etc.
Cont.

3.

4.

Benefits of personal selling 1. Availability of expertise

2.
3. 4.

Early access to relevant market information

Availability to be flexible regarding processes, timing Faster, shorter contracts

5.
6. 7.

Economies of information sharing

Lower cost of selling Knowledge of other uses or applications

Efficacy of Personal Selling

Personal Selling with Respect to Product Strategy

Since salespeople are in direct liaison with prospective customers, their input is valuable during product development.
Personal Selling and Pricing Decisions Sales personnel undergo requisite interaction with prospective customers to gauge their mood with respect to different price levels. Personal Selling and Distribution The end result of any distribution effort is the ready availability of the product to the customer, in the right quantity and at the right place. Personal Selling and Product Promotion Sharing the same values that the customer does, a salesperson provides motivation and generates interest and confidence in the customer for the product.
Cont.

Steps in Personal Selling Successful personal selling calls for an integrated approach devised from the experience of the sales personnel. The approach comprises the steps as shown in the figure here. Each of these steps are further described in brief.
Steps in Personal Selling

Cont.

Prospecting
Prospecting is the process of identifying prospective buyers of the product. A prospect is qualified if he has the authority, need, ability and eligibility to buy. There are different ways to identify prospects. Some of the most frequently used methods are described below: Acquaintance References Cold Calling Centre of Influence Method Personal Observation Method

Direct Mail or Telephone Method

Companys Records Newspapers Retailers

Other Methods

Cont.

Steps in Prospecting
A) Formulating Prospect Definitions B)Searching out potential accounts C)Qualifying Prospects and determining probable requirements D)Relating company Products to each prospects requirements

A)Formulating Prospect Definitions : Prospective Customers must have the willingness, financial capacity and authority to buy and they must be available to the salesperson.

B) Searching out Potential Accounts:

Sl. No. 1 Prospecting Method Referrals from existing Customers Brief Description Requesting Existing customers to suggest names. This is convincing for two thirds of the leads Company advertising, direct mail, website, trade shows Suppliers, Intermediaries,, bankers, trade associates, commercial dotcom vendors.

2 3

Referrals from Internal Company Sources Referrals from External Sources

Networking by Sales persons

Sales persons become members of civic/social organisation like Lions Club, Bangalore club etc.
Yellow Pages published by government and private publishers Un announced calls by sales persons

Industrial Directories

Cold canvassing

Qualifying Prospects and determining probable requirements

As information is assembled on each tentative prospect, the ones with requirements too small to generate profitable business are removed, unless the growth possibilities are promising. The additional information for qualifying the prospects is received by the personal visits of the sales persons only.

Relating company products to the prospects requirements

The final step is to plan the strategy for approaching each prospect. From the information gathered it is now easy to determine each prospects probable needs.

Methods of Prospecting
Cold Canvassing Endless Chain customer referrals Prospect pool Centres of influence Non Competing Sales Force Observation Friends and Acquaintances Lists and Directories Direct Mail Telemarketing Trade Shows and Demonstrations

Pre-approach Pre-approach is the second step in the selling process which emphasises that the salesman should know, after identifying the prospect in the prospecting stage, the prospects likes and dislikes, his needs, preferences, habits, nature, behaviour, economic and social status etc. Significance of Pre-Approach 1. 2. Salesman concentrates only on the prospects and not the suspects. Salesman gain all the possible information about the prospect before approaching him. Hence any kind of loose talk or serious mistake can be avoided. He is able to give a sales presentation more efficiently, effectively and with confidence. It does not waste the prospects time and energy since the salesman is already aware of the needs and preferences of the prospect. Cont.

3. 4.

Referrals

Relationship between customer and salesperson deteriorates

Friends and acquaintances P Directories P Trade publications and trade shows P P Telemarketing advertising and P P P

Business failure

P P P P New buyer buys from another source

The Ferris Wheel concept, which is aimed at supplying an ongoing list of prospects, is part of world sales record holder Joe Girards customer strategy

Acquisitions and mergers

Customer moves

Death of customer

Cold calling

Customer has only a one-time need for product Cont.

Networking

Customer needs change because of new technology

Usage of Prospecting Time Sales force must plan its time in such a manner that maximum time is made

available for those prospects who are likely to give a large volume of
business to the company. To avoid this wastage of time, grading of the prospects will be an important step.

Cont.

Approaching In this stage the prospect and the salesman come in contact with each other

face to face.
The salesman has an opportunity to understand and interact with the prospect in a better way. Salesman should put forward his best efforts to make the best use of this opportunity in getting the attention of the prospect and to convince him to buy the product. Getting the attention of the prospect and persuading him to buy are the two

main objectives of a salesman.

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Approach Adopted by Travelling Salesmen A salesman may directly approach the prospect without any introduction whatsoever and then conduct an interview.

Sending an advance mailer explaining his product and its benefits vis--vis other products available.
There is no better method of securing an appointment with a prospect than through a reference given by the friend, relative or business associate of the prospect. Another effective way of securing an appointment and interview with the prospect is for salesmen to give away gifts to the prospects before asking for an appointment. Sale letters have proved to be another kind of door opener.
Cont.

Successful Approach The following points specify the importance of a successful approach:

i.

A successful approach enhances the sale and it is thus important for the
running of a business.

ii.

A failed approach will give an opportunity to the rival company. So a good approach will go a long way in building good relations with the prospect while a bad approach will not only result in losing business but will also make it easy for a competitor to tap new customers.

iii.

The approach helps in enlightening the prospect by providing him ample

information about the product, price, competitors product, benefits etc. that
he can derive from the product.
Cont.

Key guidelines for successful approach

Prior Appointment
Timing Command

Relaxed Atmosphere
Open Mindedness Courtesies

Effective Presentation
Follow up
Cont.

Methods of Approach There are different methods of approaching a prospect and some of the most important ones are given below.

Cashing in on Brand Name or the Companys Reputation

Customer Benefit Approach Innovative Product Opens the Door to the Salesman The Premium Approach (Small Gifts or Novelties) The Stock Approach The Approach of Making the Prospect Feel Important The Survey Approach Interactive Approach
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Presentation
Quick presentation creates a good impression. Attractively packaged, decorated and well- organised.

Should explain the product with its features and price advantage to the
customer in simple and easy terms.

Customer be shown the kind of quality that he is looking for.

Helps the salesman to prove the features of the product and emphasise its
genuineness.

Cont.

Demonstration
Demonstration is an exercise to prove the characteristics of the product. It highlights various attributes of the product such as utility, performance,

service and quality.

It is only during the demonstration that the customer gets an opportunity to verify the facts about the product. Demonstration is imperative and essential for a prospect to make a buying decision.

Cont.

The Close This is the last stage of any sales presentation. The main aim of the close is to convince the prospect to sign the order form or to place an order immediately rather than in the future. It is also important that through proper planning, prospecting, presentation

and demonstration the salesman should try to capture the attention of the
prospect and not let the prospect change his mind.

Relationship of Salesmanship with Sales Management

and personal Selling
Salesmanship & Personal Selling 1. 2. 3. 4. 5. The ability to quickly develop rapport with their prospective customers. A desire to truly help their customers. The habit of asking questions to gather information before making a pitch. Sticking to a consistent, proven sales process. A never ending desire to learn more about how to sell more effectively.

Cont.

Myths about selling Myths of selling: There are various myths about selling process which needs to

be cleared for a sales person.

1. 2. 3. 4. 5. Buyers are liars Anyone can be persuaded to buy In buying decision, price is the primary reasons A technique that works well for one person will work for everyone Close the sales as soon as possible

6.

The deal can be closed at any price

Cont.

SELL Model This is a simple model describing the various actions associated with the word itself. 1. Show features: it is the very first stage; expected to show the features of the product, demonstrating how it works, and showing the results of using the product immediately. 2. Explain advantage: Immediately, after demonstrating the product, explain the advantage possibly related with the features, showing the advantages which ate derived from it. 3. Lead into benefits: Correlate the advantages with the benefits. This is simply highlighting the materialization of those benefits in conducting the set of activities due to having/using the product. 4. Let them talk: Then at the end, let them talk further about the product, its features and those future benefits. If the previous steps are done well, they will talk themselves for the sale.
Cont.

SLAID Model This is another simple model describing the various actions associated with the word itself, Slaid acronym for sales steps.

1.

Show the product: Showing the product in full or showing specific function
is also possible in the beginning, just to trigger the anxiety or curiosity in their mind. It is not a full product demonstration. Demonstration comes a bit latter state in this methods.

2.

Listen: A partial demonstration flash triggers a lot of questions, or estimations or expectations, in case if the product is absolutely new concept.

3.

Acknowledge: Your hearing will endorse that you have understood and are

ready to fulfill their needs. You may be given elaborative further deep
information about their objection.
Cont.

4.

Identify: Identify the objections, and bring them on a squaring off situation with contents offered by your product. If possible, set up a concession clause, balancing the benefits of new product over the old objections, so that you can handle the objection and will get the sale.

5.

Deliver: Ask the participants to repeat the demonstration to build the confidence about the product performance.

Cont.

Difference between advertising and Personal selling

Bothpersonal selling as well as advertisingare the means to communicate with the target customers for the product or service of an organisation. To be effective, i.e., to produce results, in terms of sales or orders, both should be understandable, interesting, believable and persuasive. i. However, there are some notable differences between these two means of communication. ii. The customer comes in direct contact with the salesperson. In advertising, on the other hand, the customer does not come in direct contact with any representative of the organisation. iii. Advertising has a major role during the pre-purchase phase as the mass demand for the product has to be generated. Advertising also plays an important role in post-purchase phase as it gives sound reassurance to the purchaser. Personal selling, on the other hand, has an important role to play in all the three phases. It plays a major role in the purchase phase. Cont.

Three Phase of a Products/Brands Market 1. 2. 3. Pre-purchase phase Purchase phase Post-purchase phase
Advertising Personal Selling

Pre-purchase

Purchase

Post-purchase

The pre-purchase phase is characterised by the phase where the trying to convince the targeted customers of the benefits of the The purchase phase is the time/duration when the customer is mind to actually buy the product. The post-purchase phase is customer has bought the product and is evaluating the decision.

organisation is product/brand. making up his one when the

Theories of Personal Selling

There are three main theories of personal selling, which are as follows: AIDAS Theory Right Set of Circumstances Theory

Buying Formula Theory

Behavioral Equation Theory

Cont.

AIDAS Theory this theory is based on the premise that during a sales presentation, the prospect consciously goes through five different stages: Attention, Interest, Desire, Action

and Satisfaction.
Attention: The salesperson should attract the prospect to his presentation before he actually goes into the details of the same. Interest: He/she should maintain the interest of the prospects throughout the presentation. Desire: The next step in the sales process, as per the AIDAS theory, is to create a strong desire in the prospects mind to purchase his product. Action: Once the salesperson has been successful in taking his prospect through the three stages, as discussed above, he should induce the prospects into actually buying the product.
Cont.

Right Set of Circumstances Theory/ Situation Response Theory The advocates of this theory opine that all the circumstances, which led to the sales, were appropriate or right for the sales to have taken place. In other words, if the salesperson is successful in securing the prospects attention, maintaining his interest and inducing his desire to buy the product, sales will result. Moreover, if the salesperson is highly skilled, he will take control of the situation/circumstances, which would lead to sales. This theory lays more emphasis on the external factors. All sales personnel applying this theory find it difficult to tracing internal factors in many situations.

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Buying Formula Theory

The buying formula theory is based on the analysis of the sequence of events that goes on in the buyers mind during the sales presentation. Thus, the theory emphasises on the factors internal to the prospect and the factors which are external, i.e., influence of the salesperson on his prospects decision to buy his product. The theory is based on the presumption that the salesperson will take care of the external factors. The sequence of events in a prospects mind can be represented as
Need Solution Purchase

There are all the chances that a continuous relationship will develop between the prospect and the salesperson. As a result of sales, the satisfaction will also come in the sequence. This sequence can be presented as
Need Solution Purchase Satisfaction

 In Purchasing the element solution involves two parts. Product( and /or service) and trade name. In the buying process the purchaser follows the following sequence
Need or Problem Product/t rade name Satisfacti on/ Dis satisfacti on

purchase

To ensure purchase, the product service and the trade name must be considered: Adequate And the buyer must experience A pleasant feeling or a sense of anticipated satisfaction When a buying habit is bring established, the buyer must know why the product or service is adequate solution to the need or problem and the reason the trade name is the best to buy. The buyer must also have a pleasant feeling toward the product or service and the trade name.

Behavioural Equation Theory

Four essential elements of the learning process included in the stimulus response model( cue for this theory) are: Drives Cues Response Reinforcement

 Drives: They are strong internal stimuli that impel the buyers response. They are two kinds: a) Innate Drives b) Learned Drives Cues: They are weak stimuli which determine when the buyer will respond. a) Product Cues b) Informational Cues c) Specific Product and Informational Cues

Response: Response is what the buyer does. Reinforcement: it is an that strengthens the buyers tendency to make a specific response. These Four Elements are incorporated in a equation: B= PXDXKXV B= response or internal response tendency P = predisposition or inward response tendency, that is , force of habit D= present drive level ( amount of motivation) K= incentive potential that is value of the product or its potential satisfaction to the buyer V= intensity of all cues