1. Sales Behaviour and Sales Success
Larger sales require different sales techniques to small scale sales
- mutli-call sales (dream 100 sales)
- hard sales technique not effective in dream 100 sales
- must build-up value in large sales
- large sales its less about buying a product, and more about entering a relationship
- the larger the sale, the more the buyer perceives the risk of making a mistake
4 stages of a sales call:
1. preliminaries: initial interaction
2. investigating: uncovering needs or better understanding customers. Finding soething out from the customer that will enable you to sell more effectively
3. demonstrating capability: demonstrate to customers you've something worthwhile to offer
- solution to solve a problem
- formal presentation
4. obtaining commitment: advances to final decision
- investigating phase is most important in large sales
- key is asking questions
- closed questions: answered in a word - yes or no
eg. do you make the purchasing decisions?
- open questions: require larger answer
eg. why is that important?
- Situation Questions: data gathering questions about facts and background
- Problem Questions: explore problems, difficulties, and dissatisfaction and areas where sellers product helps.
- Implication Questions: impplication questions take a customer problem and explore its effects or consequences. These questions help customer understand problems seriousness or urgency
eg. How will this problem affect your future profitability?
- Need-payoff Questions: get the customer to tell you the benefits your solutions could offer
eg. would it be useful to speed this operation by 10%?
2. Obtaining Commitment: Closing the Sale
Closing defined as:
"A behavior used by the seller which implies or invites a commitment, so that the buyer's next statement accepts or denies commitment."
- "closing techniques" not effective in larger sales
- By forcing the customer into a decision, closing techniques speed the sales transaction
- Closing techniques may increase the chances of making a sale with low-priced products. With expensive products or services, they reduce the chances of making a sale
- closing techniques not effective with sophisticated buyers
- closing techiques may decrease customer satisfaction post-sale
- closing techniques not effective if post-sale relationship with customer
- Close is still necessary: but how get commitment without closing techniques?
- obtaining commitment: what level of commitment is necessary to characterise it as success?
Call Outcomes (large scales):
Orders: customer makes firm commitment to buy. (signing paperwork)
Advance: event (either on call or after) that moves sales forward towards a decision
eg. agreement to off-site demo access to higher decision maker
- advance is most common objective in large sales. Successful closing involves becoming what Advance you can obtain from the call
Continuation: sale will continue but no specific action is agreed by customer to move forward
eg. visit us again soon. lets meet again
No-Sale: customer actively refuses a commitment. denies principle objective
- Action/movement forward is the key and different between Advance and Continuation
- Set call objectives that result only in a Advance
- Question objectives ruthlessly: objectives must result in a specific action
- 4 successful Actions: obtaining commitment
1. giving attention to investigating and demonstrating capability
- build needs by asking questions. customers realise urgent need to buy
2. check key concerns are covered
3. summarising the benefits/key points before obtaining commitment
4. proposing a commitment
- suggest appropriate next step to the customer
Characteristics of successful commitments:
1. the commitment advances the sale
2. the commitment is the highest realistic commitment that the customer is able to give.
3. Customers Needs in the Major Sale
Investigating is most crucial phase
Small scale needs:
- exclusively one persons
- strong emotional component
- risk of mistake insignificant vs cost job
- needs take longer to develop
- needs involve different people
- needs using more rational that emotional, although emotion still important
- fueled purchasing decision more implications for customer
- any statement made by buyer which expresses want or concern that can be satisfied by the seller
- needs evolve:
- minor imperfection
- clear problem, difficulty, dissatisfaction
- finally becomes need, want, desire, intention to act
It's almost perfect
-> Little dissatisfied
-> -> I've got a problem with...
-> -> -> I need to change immediately
Implied and Explicit Needs
Implied Needs: statements of problems, difficulties and dissatisfactions
eg. a current system can't cope
Explicit Needs: specific customer statements of wants or desires
eg. we need a faster system
- key to treat implied and explicit needs differently
- value equations
Purchase decision must balance the seriousness of the problems that the purchase would solve, with the cost of the solution
"Is the problem big enough to justify this solution?"
- need must be developed further so it becomes larger, more serious and more acute.
- cost isn't only money, can cost buyers job!
- Implied Needs not significantly higher in successful calls, however Explicit Needs were twice as high
- must uncover Implied Needs, and must develop Implied Needs into Explicit Needs: convert into Explicit Needs by questions.
- Explicit Needs are the buying signals that predict success in larger sales
The purpose of questions in the larger sale is to uncover Implied Needs and to develop Explicit Needs
4. The SPIN Strategy
Situation, Problem, Implication, Need-Payoff
- Situation Questions: finding out about customers existing situation
- less emphasis on these: only ask necessary situation questions
- Problems Questions: questions about problems, difficulties, dissatisfactions
- probe for problems, difficulties, etc
- invites customer to state Implied Need
- purpose is to uncover Implied Needs (but remember Explicit Needs is key, so need to develop).
Implication Questions: question about the effects, consequences or implications of problem
- these tip the value equation to "buy" by developing the seriousness of the problem
- loss of quality
- cost of outside work
- overtime costs
- $25,000 training costs
- lend to use
- what effect does that have on output?
- could that lead to increased costs?
- will it slow down your proposed expansion?
- Implication Questions effective when selling to decision makers
Need-Payoff Questions: questions about the value or usefulness of the solutions
- positive solution-centred questions
- is it important to you to solve this problem?
- why would you find this solution useful?
These are important:
- focus customers attention on solution rather than problem
- get the customer telling you the benefits
- these questions reduce objections, rehearse the customer for internal selling
- remember roll of internal sales
Implication Questions are problem-centred, they make problem more serious. Need-Payoff Questions are solution-centred, they ask about usefulness or value of solving a problem
SPIN MODEL: Figure 4.10
- recognise you're a problem-solver as salesman
- pg.94: process to prepare
- avoid Need-Payoff questions early
- don't ask Need-Payoff questions you can't meet
- practice effective Need-Payoff questions
5. Giving Benefits in Major Sales
Features: facts (data,information) about a product, unpersuasive
Benefits: show how Features can help the customer, more powerful
- technical products, buyer may develop "features appetite"
- buyer would respond to features
- Type A Benefit ("Advantages"): this type of benefit shows how a product or service can be used or can help the customer
- Type B Benefit ("Benefits"): this type shows how a product or service meets an Explicit Need expresssed by the customer
- Type B Benefit very effective in larger sales
1. don't demonstrate capabilities too early in the call
- first develop Explicit Needs by using Implication and Need-Payoff Questions
2. beware Advantages: need to [[need]] Explicit Needs with Benefits
3. be careful with new products: focus on customer needs, not product Feature and Advantages
6. Preventing Objections
Selling on Features makes customer most sensitive to price. Example of watches advertising.
Advantages lead to Objections: need to build up valuue to merit expensive solution
- SPIN strategy followed by Benefits that meet Explicit Needs
7. Preliminaries: opening the call
- Focus on objective of moving to the Investigating Stage
- Move quickly to business quickly
8. Turning Theory into Practice
1. practice only one behavior at a time.
2. try new behaviour at least three times
3. quantity before quality: ask lots of questions
4. practice in safe situations
- Focus on the Investigating Phase
- Develop questions in SPIN sequence
- Analyze your product in problem-solving terms
- what problems does it solve?
- Plan, Do and Review