CH-1-2 Overview of Personal Selling – SELL : Book Guide

This Document Contains Chapters 1 to 2 INSTRUCTOR’S GUIDE Chapter One — Overview of Personal Selling Introduction As suggested by the title, the first chapter provides an overview of what personal selling is all about, which tends to be an eye-opener for most students with little to no sales experience. A lack of knowledge or a distorted view of personal selling due to past experience can be a source of a negative attitude amongst students regarding selling as a career choice. A number of questions can be used to start the discussion for this chapter, such as: What does personal selling mean to you? Based on your experience as a consumer, what makes a good sales person? A bad one? Where does personal selling fit within the overall marketing mix of an organization? Learning Objectives 1-1 Define personal selling and describe its unique characteristics as a marketing communications tool. 1-2 Distinguish between transaction-focused traditional selling and trust-based relationship selling, with the latter focusing on customer value and sales dialogue. 1-3 Describe the evolution of personal selling from ancient times to the modern era. 1-4 Explain the contributions of personal selling to society, business firms, and customers. 1-5 Discuss five alternative approaches to personal selling. 1-6 Understand the sales process as a series of interrelated steps. Chapter Outline Introduction-3 1-1 Personal Selling Defined-4 1-2 Trust-Based Relationship Selling-4 Importance of Customer Value-4 Importance of Sales Dialogue-6 1-3 Evolution of Personal Selling-7 Industrial Revolution Era-7 Post-Industrial Revolution Era-7 War and Depression Era-7 Professionalism: The Modern Era-7 1-4 Contributions of Personal Selling-8 Salespeople and Society-9 Salespeople and the Employing Firm-10 Salespeople and the Customer-11 1-5 Alternative Personal Selling Approaches-12 Stimulus-Response Selling-12 Mental States Selling-13 Need Satisfaction Selling-14 Problem-Solving Selling-15 Consultative Selling-15 1-6 The Trust-Based Sales Process-16 Appendix Chapter 1: Sales Careers-20 Characteristics of Sales Careers-20 Classification of Personal Selling Jobs-21 Qualifications and Skills Required for Success by Salespeople-24 Supplemental Internet Resources A. The Canadian Professional Sales Association (CPSA) Website www.cpsa.com is a good resource for information on professionalism and ethics in selling. B. Sales Jobs Canada http://ca.salescareersonline.com/ is one example of a job listing service for employers looking to hire sales people. Students can review job descriptions for different types of sales positions and the qualifications employers are looking for in candidates. C. The Journal of Personal Selling and Sales Management at http://jpssm.org is a good example of an academic journal dedicated to topics in personal selling which is available through most school library online databases. D. The Professional Sales Academy Website www.salesacademy.ca is one example of the many different sources of sales training programs and materials that are available to someone interested in becoming a salesperson. The business of providing sales training is a very large industry that is largely unregulated, which can make it difficult for customers to make an informed choice. Exercises Developing Professional Selling Knowledge Download the Instructor’s Guide — Solutions and Discussions for responses and discussions to these exercises. Exercises 1. How is personal selling different from other forms of marketing communications? Personal selling is part of the promotion program of an organization’s marketing mix, used primarily to communicate with potential buyers for the purpose of selling a product or service. The differences between personal selling and other forms of marketing communications are reflected in its four characteristics: direct contact with the buyer; two-way communication; flexible message content; and immediate feedback. Due to these characteristics, personal selling is used to initiate, develop, and enhance customer relationships, as per the definition provided in the text. 2. What are the key differences between transaction-focused traditional selling and trust-based relationship selling? In transaction-focused traditional selling, salespeople are focused on maximizing short-run gain, and are self-oriented rather than customer-oriented. Little attention is given to uncovering needs or providing customized solutions. Instead, selling tactics include a heavy reliance on objection handling and closing techniques. Little to no post-sale follow-up is provided by the salesperson unless it is focused on another transaction. In contrast, trust-based relationship selling strategies focus initiating, developing and enhancing long-run mutually beneficial relationships with the customers. Selling methods are customer-oriented, focusing on need discovery and presentation of customized solutions. Post-sale follow-up is considered an important part of the relationship development process. 3. What factors will influence the continued evolution of personal selling? The continued evolution of personal selling as a profession is necessary in response to the ever growing complexity of our dynamic environment. Factors that will influence this evolution include the increased sophistication of buyers, economic uncertainties, social media, and new computer technologies. Other issues include intensified competition, more emphasis on improving sales productivity, fragmentation of traditional customer bases, customers dictating quality standards and other procedures, and a greater demand for in-depth, specialized knowledge as an input to purchase decisions. 4. How do salespeople contribute to our society? Are there negative aspects of personal selling from a societal perspective? Salespeople contribute to society’s goal of economic growth in two basic ways. First, they act as stimuli for economic transactions by initiating action within the business world. In a fluctuating economy, salespeople make invaluable contributions by assisting during recovery cycles and by helping to sustain periods of relative prosperity. Salespeople also contribute to our society by playing a critical role in the diffusion of innovation, the process whereby new products, services, and ideas are distributed to the members of society. Consumers who are likely to be early adopters of an innovation often rely on salespeople as a primary source of information. Consumers often exhibit strong resistance to change; however, change is necessary in the long run for the continued progress and/or survival of society. By encouraging the adoption of innovative products and services, salespeople make a positive contribution to society. The negative aspects of personal selling can become apparent when salespeople allow themselves to exhibit unethical conduct. If salespeople mislead a consumer regarding a product or service for their own or their company’s benefit, then society is negatively impacted. Society’s perception of personal selling as a professional and ethical occupation is adversely affected, and salespeople’s credibility as accurate sources of new information becomes damaged. 5. What are the primary contributions made by salespeople to their employers? Salespeople make three important contributions to their firms. First, they are the direct producers of revenue in most business firms. Second, they play an important role in market research and in providing feedback to their firms. For instance, salespeople can provide information about customer requested additions to the product line. The third contribution that salespeople make to their firm is serving as a pool of candidates for promotion into management positions. The sales job is often considered an entry level position providing the right foundation for future management assignments. 6. Most businesses would have a difficult time surviving without the benefits of the salespeople who call on them. Do you agree? Yes; customers benefit from salespeople in many ways. Buyers expect salespeople to contribute to the success of the buyer’s firm. Salespeople do so by providing valuable information to buyers and using their problem solving skills to benefit the buyer’s firm. 7. How are need satisfaction and problem-solving selling related? How do they differ? Need satisfaction and problem-solving selling are related in that each seeks to uncover and satisfy the needs of the buyer. Problem-solving selling differs from need satisfaction selling in that it seeks to identify a set of alternative solutions, which may include a competitor’s product, to satisfy the buyer’s needs. 8. How does the consultative selling approach differ from problem-solving and need satisfaction selling? Explain the three key roles of consultative salespersons. Consultative selling differs from problem-solving selling in that this type of selling is focused on helping customers reach their strategic goals, not merely solving immediate problems or filling immediate needs. To engage in consultative selling, the salesperson must possess a great deal of knowledge about the customer’s business and industry. This is necessary so that the salesperson can provide the customer with insight into all areas of his/her business that influence their ability to reach their strategic goals. The three key roles of consultative salespeople include the strategic orchestrator, the business consultant, and the long-term ally. As the strategic orchestrator, the salesperson’s primary job is to utilize the resources of the sales organization to help the customer obtain his/her strategic objectives. As the business consultant, the salesperson’s job is to become an expert on the customer’s business and industry. This often entails seeking internal and external resources in order to become better educated with respect to the customer’s business. As a long-term ally, the salesperson’s job is to support the customer, even if a sale is not expected in the short term. 9. How important is teamwork between the customer and the sales organization in practicing consultative selling? How does teamwork within the sales organization factor into consultative selling? Teamwork between the customer and the sales organization is essential if consultative selling is to be successful. This is especially true when the salesperson is assuming the role of a strategic orchestrator and long-term ally. Teamwork within the sales organization is also essential given that internal resources must be directed toward helping the organization’s customers achieve their strategic goals. 10. Discuss the final step of the sales process (enhancing customer relationships) as it relates to the continuing evolution of personal selling. The final step of the sales process is enhancing customer relationships, which is an important part of the continuing evolution of personal selling. As personal selling evolves from a transaction-oriented process into a relationship management process, the ability of the salesperson to enhance relationships will become increasingly important. Group Activity Word Association: The Image of Salespeople Before placing students into teams, ask them to spend two minutes thinking of positive and/or negative words that come to mind when they hear the word “salespeople.” Instruct the students to make a list of these words. Now put the students into three-person teams. Allow 10 minutes for each team to compare thoughts and develop a list of words associated with the word “salespeople.” Next, ask each one team to share their list with the class. Record these responses on the board in two columns, one “positive” and the other “negative.” Continue recording responses from each team, and then discuss the findings. Many students often negatively stereotype salespeople. This is typically a result of perceptions they have formed about salespeople from their encounters with retail salespeople, movies negatively portraying salespeople, and accounts of salespeople in the popular press. Discussion can focus on the characteristics that a professional salesperson should possess and how the negative stereotypes of salespeople can be overcome. The purpose of this exercise is to bring to the surface negative stereotypes associated with salespeople and selling. Most students will have at least some negative attitudes toward salespeople and selling because of their limited exposure to professional selling. Instructors should use this exercise as an opportunity to assure the students that the focus of the course is on trust-based relationship selling, a type of selling that is markedly different from the stereotypes permeated by the media and door-to-door selling. Experiential Exercises Understanding What It Takes to Succeed in Sales Objective: Build awareness that a career in sales requires a high working knowledge and skill level, and that salespeople must be well prepared when calling on customers. Time Required: Two hours outside of class (one hour to conduct an interview with a sales professional, and one hour to write an interview summary). Teaching Tip: In some instances, this assignment will be better suited to a team approach with 2–3 students per team. Salespeople from organizations that recruit on campus can be a good source for finding interview candidates. Have students interview a salesperson to better understand what it takes to be successful in professional selling. In addition to the following interview questions, require students to develop two additional questions for their interviews. 1. What are some of the key skills required in your job? Key skills required in sales include effective communication, active listening, persuasion, and relationship building. Successful sales professionals must also possess strong negotiation abilities and a deep understanding of the products or services they are selling. Adaptability and resilience are essential traits in the ever-changing landscape of sales. 2. What do you need to know about your products/services in order to succeed? To succeed in sales, understanding your products/services thoroughly is paramount. Salespeople must possess in-depth knowledge about the features, benefits, and applications of what they're selling. They should also be aware of industry trends and competitive advantages to effectively address customer needs and objections. Furthermore, grasping how their offerings solve customer pain points and add value is essential for successful sales interactions. 3. How has professional selling changed in the past few years? In recent years, professional selling has undergone significant transformations due to technological advancements and shifting consumer behaviors. Salespeople now rely more on digital tools and platforms for prospecting, nurturing leads, and closing deals. Additionally, there's a greater emphasis on building relationships and providing personalized experiences to meet evolving customer expectations. Adaptability and agility are increasingly crucial as sales strategies evolve to align with changing market dynamics and emerging trends. 4. How do you prepare for sales calls with new customers? Preparing for sales calls with new customers involves thorough research and planning. Salespeople typically gather information about the prospect's industry, company background, pain points, and potential needs. They customize their pitch and identify relevant product/service features and benefits that address the prospect's specific challenges or goals. Additionally, they anticipate objections and prepare persuasive responses to overcome them, ensuring a productive and tailored interaction with the prospect. Video Exercises Overview of Personal Selling Preview all six scenes. Empathy, ego drive, strong interpersonal communication, and enthusiasm are some of the qualities required to be a successful sales professional. As you progress through this course, it will be beneficial to keep some of these qualities as an organizing framework to refine and build your skill set. Mark – Manager for Player One Lisa – Sales Rep for Alpha Tech, Security system provider trying to earn the customer away from Goodman Jim – Sales Rep for Goodman, Current provider of security system Ask your students: 1. Review the videos and comment on the sales professional’s performance in areas mentioned above. Students’ answers will vary but should address a couple of key issues. Both salespeople demonstrate some empathy and decent interpersonal communication skills. Jim seems to be assuming he will win the contract because he is the current provider and because he has a good relationship with Mark. As a result, Lisa demonstrates greater enthusiasm than Jim. In reviewing the videos, observe how each sales professional demonstrates empathy by understanding the customer's needs and concerns. Look for instances where ego drive motivates them to persistently pursue the sale without being pushy. Evaluate their interpersonal communication skills, noting how effectively they establish rapport and convey information. Finally, assess their level of enthusiasm and passion for their product or service, as it often influences customer engagement and buying decisions. 2. Comment on the role that these sales people contribute to society. Students’ answers will vary, but should include mention of the diffusion of innovation. For example, other salespeople are helping with the diffusion of innovation – informing Mark about new security technology. In addition, both are trying to help stimulate the economy by proposing Mark spend $40–$50 thousand dollars on a new security system. Each of these salespeople contributes to society by facilitating the exchange of goods and services that meet people's needs and enhance safety and security. Mark, Lisa, and Jim play vital roles in providing solutions that protect individuals and businesses, contributing to overall well-being and peace of mind in society. Their efforts help foster trust and confidence in the products and services they represent, ultimately contributing to a safer and more secure environment for everyone. 3. What managerial roles do you see in the clip? Students are likely to have some difficulty with this question as none of the clips includes managers (other than the customer). However, Jim appears to have greater autonomy than Lisa as he is able to make changes to the proposal (e.g., price discount) without needing managerial approval. Both salespeople seem to be able to manage their respective sales support personnel (i.e., IT folks) to effectively generate an appropriate solution. In the clips, Mark, as the Manager for Player One, exhibits managerial roles such as leadership, guidance, and strategic decision-making. He directs and supports his sales team, ensuring they have the resources and support needed to succeed. Additionally, Mark oversees the overall sales strategy and is responsible for setting targets and objectives to drive performance and achieve organizational goals. Chapter 1 Case Summary: Craig Robertson is a sales representative for Slavik’s Sports Inc. (SSI), a Vancouver-based supplier of custom-made novelty sports items such as bobble-head figures, caps, sunglasses, and sweatshirts. Craig was recently relocated to Vancouver and was eager to grow his territory. By most indications, Craig was a good salesperson and had received nothing but positive feedback from his sales manager, Felicia Jameson. During his first 60 days in Vancouver, Craig landed some major customers and was optimistic about landing another important account, H2G, a large manufacturer of garden tools. Craig did his research on H2G in preparation for his sales call with Cam Evans, Director of Marketing for H2G, but the call did not go well. An unexpected snow storm had created traffic delays throughout the area, and consequently, Craig was late for his meeting with Cam. As the sales call progressed, Craig did most of the talking, telling Cam about SSI and its capabilities. While Craig and Cam did discuss H2G’s regular use of tradeshows as a tool to stimulate sales, Craig asked only one question (What works well for you in terms of standing out at those shows?) related to H2G’s tradeshow strategy. He did not ask about H2G’s tradeshow objectives or budget. Cam’s interest in continuing the call waned and he ended the meeting abruptly, indicating he would contact Craig if H2G developed an interest in what SSI offered. Craig left without making another appointment. Discussion Questions 1. What problems do you see with Craig’s H2G sales call? •Failed to confirm that Cam knew Craig would be late •Spent too much time early in the call talking about SSI without asking Cam what he knew about SSI •Did not ask enough questions to determine Cam’s needs •Did not ask Cam to discuss why he felt they had “wasted a lot of money on giveaways in the past,” or why it was important for H2G to differentiate itself from its competitors during the tradeshow •Did not ask about H2G’s trade show objectives •Did not ask about H2G’s trade show budget •Did to gain commitment to pressing the sale 2. If you were Craig’s sales manager, what would you recommend he do to improve his chances of succeeding? First, Craig should always pay attention to weather conditions that may create delays and plan accordingly. If he is going to run late, Craig should make sure his customers know. Craig should reschedule appointments if he believes doing so is necessary for him to have adequate time to conduct his sales call. Craig needs to remember his goal is to develop a trust-based relationship, and that such a relationship is developed through sales dialogue, not a sales monologue. During the early stages of the sales process, Jeff should make sure that he asks the customer questions that will help him learn about the customer’s unique needs. This means the customer should be doing most of the talking early on. It is only after he understands the customer’s unique needs that he will be able to discuss how his company can deliver customer value. Finally, Craig should be prepared for abrupt endings to meetings resulting from unforeseen circumstances. He should have a well-rehearsed contingency plan in place so he can end the meeting professionally and with a some degree of commitment to a “next step.” Role Play Ask six students to participate in a role play (one playing Craig, four playing other SSI Sales Representatives, and one playing Jeff’s Manager Felicia) in which Craig describes to his colleagues and his sales manager his sales call with Cam. The description should focus on how his sales call matches up with transaction-focused or trust-based focused selling behaviours (see Exhibit 1.1). When finished, have the class discuss the following: 1. Is Craig’s review of his sales call accurate? Craig's review of his sales call may not be entirely accurate. While he acknowledges the unexpected circumstances that affected his punctuality, he might not fully recognize the impact of his approach during the meeting. His heavy focus on talking rather than listening and lack of probing questions about H2G's specific needs and objectives likely contributed to Cam's disinterest. A more comprehensive review should include reflection on his engagement and questioning techniques to improve future interactions. 2. What steps should Craig take to begin to develop a strong relationship with Cam Evans at H2G? To develop a strong relationship with Cam Evans at H2G, Craig should take the following steps: 1. Apologize for the tardiness caused by the snowstorm and express understanding of any inconvenience it caused. 2. Demonstrate active listening during future interactions with Cam, focusing on understanding H2G's needs, objectives, and challenges. 3. Tailor his approach to highlight how SSI's products and services can specifically address H2G's requirements and add value to their business. 4. Follow up with Cam promptly after the initial meeting, expressing gratitude for the opportunity to connect and offering to provide further information or assistance as needed. 5. Schedule a follow-up meeting or call to continue the discussion and explore potential collaboration opportunities based on the insights gained from their initial interaction. Chapter 1 Continuing Case Introduction The National Copier Company (NCC) sells a variety of copiers to small and medium-sized businesses. NCC has been in business for five years and has been growing at a steady pace. NCC differentiates itself from other copier companies by customizing its products to meet the specific needs of each customer and by providing excellent customer service. The company’s salesforce plays a key role in creating value and managing customer relationships. Brenda Smith has been a NCC salesperson for the past three years. She has steadily improved her sales performance during her time with NCC, and now is in the top 25 percent of all NCC sales representatives, as measured by two key metrics: overall sales volume and customer satisfaction. Brenda has been especially successful with small professional firms, such as attorneys, architects, accountants, and medical professionals. She is excited to begin her fourth year with NCC and has established challenging goals to increase sales from existing customers and to generate new customers. Brenda recently met with Jin Tan, her sales manager, and was quite excited about the upcoming year. Jin had told Brenda that she was progressing toward a possible promotion into sales training if she had another good year in her sales position. In addition, Jin gave Brenda this feedback: “Brenda, I think you are doing a fine job with your customers, but I would like to see you become more of a consultative salesperson in the coming year. I would also like for you to sharpen your group communications skills, as that will be important if you are promoted into sales training. We will talk about the specifics more as the year goes along. Meanwhile, thanks for your results to date and good luck with the upcoming year.” Questions 1. Brenda had been thinking about Jin Tan’s feedback that directed her to become more of a consultative salesperson. In thinking about her own selling approaches, she knew that she had been concentrating on the need’s satisfaction and problem-solving approaches. What must Brenda do to become a more consultative salesperson? To become more of a consultative salesperson, Brenda needs to shift her focus from helping her customers solve copier-related problems to helping her customers reach their strategic objectives. This will require her to expand her involvement with her customers, looking for opportunities to help her customers obtain their strategic objectives through the products she sells as well as the business expertise and other resources she and her company can provide. Brenda will need to serve as a strategic orchestrator, a business consultant, and a long-term ally. To fill these roles, Brenda will need to become an expert with respect to her company’s capabilities and the industries in which her customers compete. She will also need to demonstrate the trustworthiness necessary for organizations to share with her their strategic goals. 2. Three months later, Brenda was having mixed results with the consultative selling approach. She was finding that some of her customers just wanted the convenience of having a copier in their offices, and did not seem eager to discuss their strategic goals. She was beginning to wonder about the consultative selling model, thinking it was not such a good idea after all. What recommendations do you have for Brenda? First, Brenda needs to target for a consultative relationship only those customers with whom she is likely to generate enough revenue (now or in the future) to make the consultative approach profitable (at least in the long run). Given the appropriate set of customers, Brenda needs to respect and appreciate the relationship-orientation of each of those customers. Some will desire a consultative relationship and others will not. Further, developing and maintaining a consultative relationship requires greater effort and time. It’s unlikely that she would be able to effectively maintain a consultative relationship with all of her customers. Finally, I would suggest that as she gains experience, competence, confidence, and a successful track record in her role as a consultative salesperson, she will be better able to win over some of the customers currently not interested in that sort of relationship. 3. A month before the annual meeting for all NCC sales representatives, Jin Tan told Brenda, “For the upcoming meeting, I want you to prepare a 10-minute presentation about the pros and cons of the basic selling approaches that we use at NCC compared to our competitors.” NCC’s sales training program advocated the use of needs satisfaction, problem-solving, and consultative selling. Many of NCC’s key competitors used the same approaches. However, some of the toughest competitors used stimulus response and mental states (AIDA) approaches. This latter category of competitors often stressed lower prices and utilized telemarketing instead of field sales representatives in selling their products. Put yourself in Brenda’s role and prepare the presentation requested by Jin Tan. Students’ answers will vary but should include some discussion of the idea that stimulus-response and mental states approaches are transaction-focused traditional selling approaches rather than a trust-based relationship approach. These approaches, combined with lower prices and less interpersonal interaction, tend to produce price-loyal customers. This represents a disadvantage for NCC, especially if the market begins to commoditize copiers (i.e., fails to recognize any difference between competing offers). Another disadvantage of the problem-solving, need satisfaction, and consultative selling approaches is that they require a greater investment in sales training and, subsequently, are more expensive to utilize (relative to telemarketing and other non-interpersonal forms of sales communication). The primary advantage of the trust-based relationship approaches (i.e., problem-solving, need satisfaction, and consultative) is that they tend to build loyal customers and provide a certain degree of insulation against price competition. In addition, by working more closely with their customers through interpersonal interaction, NCC salespeople are in a better position to identify other opportunities (e.g., identify problems of which the customer may not yet be aware) and provide more customized solutions. Title: Comparative Analysis of Selling Approaches: NCC vs. Competitors Introduction: • Brief overview of NCC's commitment to customer-centric selling and customization. • Explanation of the primary selling approaches used by NCC: needs satisfaction, problem-solving, and consultative selling. NCC's Selling Approaches: 1. Needs Satisfaction: • Emphasize understanding the unique needs and preferences of each customer. • Tailor product offerings and solutions to address specific requirements. • Foster long-term relationships and customer loyalty through personalized service. 2. Problem-Solving: • Focus on identifying and addressing customer challenges or pain points. • Offer innovative solutions to improve efficiency, productivity, and cost-effectiveness. • Position NCC as a trusted advisor and problem-solving partner for clients. 3. Consultative Selling: • Engage in collaborative discussions with customers to uncover opportunities for improvement. • Provide insights and expertise to help clients make informed decisions. • Offer value-added services such as training, maintenance, and support to enhance customer satisfaction. Comparison with Competitors: • Highlight the selling approaches of competitors, particularly those utilizing stimulus response and AIDA methods. • Discuss the potential advantages and disadvantages of these approaches compared to NCC's customer-centric model. • Address the emphasis on lower prices and telemarketing in competitor strategies. Conclusion: • Summarize the strengths of NCC's selling approaches, emphasizing the value of customization, problem-solving, and consultative partnerships. • Reiterate the importance of maintaining a competitive edge while staying true to NCC's core values of customer satisfaction and service excellence. 4. Early in the year, Jin Tan told Brenda that her efforts were needed to gain more exposure for NCC’s college recruiting program: “Brenda, I want you to be part of a two-person team to help with recruiting on two college campuses in your territory. The other team member will be an experienced recruiter who had sales experience before moving into recruiting. The two of you should seek out opportunities as guest speakers for classes and student organizations. Your role will be to talk about how sales can be a great place to start a career and, for some, a great career path. Think about the future of selling and what it takes to be successful, and share your thoughts with students.” Acting as Brenda, make note of ten key points you would like to make about the future of professional selling and what it takes to be successful. (Hint: Be sure you read the online Appendix to Chapter 1 along with Chapter 1 before you undertake this task.) Students’ answers will vary but may include mention of: Advantages: job security, advancement opportunities, immediate feedback, prestige, job variety, independence, and high compensation. What it takes to be successful: empathy, strong ego drive, self-motivation, ethical behaviour, and strong interpersonal communication skills. 1. Embrace Technology: Acknowledge the increasing role of technology in sales processes, such as CRM systems and AI tools for analytics and automation. 2. Focus on Relationship Building: Highlight the enduring importance of building strong, trust-based relationships with customers. 3. Adaptability is Key: Stress the need for sales professionals to be adaptable and agile in responding to changing market dynamics and customer needs. 4. Continuous Learning: Emphasize the importance of ongoing learning and skill development to stay competitive in an evolving sales landscape. 5. Customer-Centric Approach: Advocate for a customer-centric mindset, prioritizing understanding and addressing the unique needs and challenges of each client. 6. Communication Skills: Highlight the significance of strong communication skills, both verbal and written, in effectively conveying value propositions and building rapport. 7. Strategic Thinking: Encourage strategic thinking and problem-solving abilities to identify opportunities and navigate complex sales environments. 8. Ethical Practices: Stress the importance of integrity and ethical conduct in building long-term trust and credibility with customers. 9. Resilience: Acknowledge the inevitable setbacks and rejection in sales and emphasize the importance of resilience and perseverance. 10. Results Orientation: Emphasize the focus on results and outcomes, with an understanding that success in sales is measured by tangible achievements and impact. Chapter Two — Building Trust and Sales Ethics Learning Objectives 2-1 Explain what trust is, explain why it is important, and understand how to earn trust. 2-2 Know how knowledge bases help build trust and relationships. 2-3 Understand the importance of sales ethics and its legal implications. Chapter Outline Introduction 31 2-1 What Is Trust?-32 Why Is Trust Important?-34 How to Earn Trust-34 2-2 Knowledge Bases Help Build Trust and Relationships-38 Industry and Company Knowledge-38 Product Knowledge-40 Service-40 Promotion and Price-41 Market and Customer Knowledge-41 Competitor Knowledge-42 Technology Knowledge-43 2-3 Sales Ethics and Legal Implications-44 Image of Salespeople and Sales Executives-45 Deceptive Practices-45 Noncustomer-Oriented Behaviour-45 Legal Implications-45 How Are Companies Dealing with Sales Ethics?-49 Chapter 2 Case-51 Chapter 2 Role Play-52 Exercises Developing Professional Selling Knowledge Exercises 1. What is the essence of trust for a salesperson? The essence of trust for a salesperson lies in being authentic, reliable, and transparent in their interactions with customers. Trust is built through consistent actions that demonstrate integrity, competence, and a genuine concern for meeting the customer's needs. Establishing trust fosters long-term relationships and enhances the salesperson's credibility and influence. 2. If trust means different things to different buyers, how is a salesperson to determine what trust means for each buyer? The salesperson must determine what trust means for each buyer by asking questions, listening to the responses, and making general observations. This is the only way the salesperson will be able to learn what trust attributes are critical to relationship-building for a specific buyer. 3. Why is trust important to a salesperson? Today’s customers are more sophisticated, more informed (or at least have access to more information), and more aware of traditional manipulative “sales tactics.” In addition, buying organizations are interested in taking advantage of efficiencies associated with using a smaller number of suppliers. Salespeople who understand these characteristics know that the stereotypical type of selling (e.g., manipulative, pushy, aggressive) is ineffective and that building mutually beneficial relationships with their customers is the only way to compete in the new millennium. Trust is important to a salesperson because it is essential for building these long-term relationships. 4. How might a salesperson go about earning trust? A salesperson can earn trust by consistently delivering on promises, actively listening to and understanding the customer's needs, demonstrating expertise and knowledge in their industry, and being transparent and honest in all communications. Building rapport through genuine connections and providing valuable insights and solutions also contributes to establishing trust with customers. 5. What does it mean for a salesperson to have a customer orientation? Customer orientation means the salesperson is as concerned about their customers’ interest as his or her own. It means truly understanding the customer’s situation and then presenting fair and balanced solutions addressing the customers’ needs. In other words, it means “looking out” for the customer. This requires salespeople to be honest, candid, and fair when dealing with the customer. 6. How would you rank the five trust builders in order of importance? Ranking the five trust builders in order of importance: 1. Expertise: Demonstrating competence and expertise in the field is crucial as it establishes the salesperson's credibility and ability to provide valuable solutions. 2. Dependability: Consistently delivering on promises and being reliable builds trust by demonstrating the salesperson's commitment to fulfilling obligations and meeting expectations. 3. Customer-orientation: Putting the customer's needs first and actively listening to understand their concerns and preferences shows a genuine commitment to their success, which is essential for building trust. 4. Candor: Transparency and honesty in all communications build trust by fostering openness and integrity, allowing for authentic and trustworthy relationships to develop. 5. Compatibility: Building rapport and establishing a connection with the customer based on shared values, interests, or personalities can enhance trust over time, but it is often dependent on the other trust builders being present. 7. Explain why expertise is such an important relationship builder. Expertise is a very important trust builder because it gives the salesperson credibility and is associated with several of the other trust builders. Credibility affords the salesperson a degree of the buyer’s trust prior to the salesperson actually earning it. Expertise may help the salesperson earn the buyer’s trust through the other trust builders. For example, salespeople with greater expertise are more likely to have greater competence and/or make more significant contributions. 8. How do knowledge bases help build trust and relationships? Knowledge bases help build trust and relationships because they empower the salesperson to use the trust-building variable more effectively. For example, as salespeople gain more product knowledge, they are better able to demonstrate expertise and customer orientation (by more precise matching of solutions to needs) and make a stronger contribution. 9. Do you think certain knowledge bases are more important than others? Why? Certain knowledge bases can be considered more important than others depending on the context and objectives of the salesperson. For example, having a deep understanding of the products or services being sold is typically crucial, as it allows the salesperson to effectively communicate value propositions and address customer needs. Similarly, knowledge of the industry, market trends, and competitors can provide valuable insights for positioning offerings and addressing customer concerns. However, the importance of knowledge bases may vary depending on the specific sales situation. In some cases, understanding customer psychology, communication techniques, or negotiation strategies may be equally or even more critical for success. Additionally, soft skills such as empathy, adaptability, and problem-solving abilities can significantly influence the salesperson's effectiveness, sometimes even outweighing specific product knowledge. Ultimately, a well-rounded salesperson should strive to develop a diverse set of knowledge bases, balancing both technical expertise and interpersonal skills to adapt to different selling scenarios and effectively engage with customers. 10. What are the three areas of unethical behaviour? Discuss each. The three areas of unethical behaviour are deceptive practices, illegal activities, and noncustomer-oriented behaviour. Deceptive practices refer to any attempt by the salesperson to mislead or otherwise deceive the buyer. For example, a salesperson may exaggerate a product’s benefits knowing that the buyer’s decision will be based on (or that the buyer is relying on) those exaggerations. Illegal activities refer to a variety of activities in which the salesperson knowingly breaks the law. For example, it is illegal for a salesperson to pad an expense reimbursement report. Noncustomer-oriented behaviour refers to actions taken by the salesperson that 1) are in conflict with the buyer’s interests, and 2) are done so when other options are available that are more customer-oriented. Group Activity Ask students to think about their experiences with salespeople. Have them write down a short list of things that salespeople have done that built trust, and a short list of things salespeople have done that have damaged trust. Next, divide the class into small groups and have them discuss and combine their lists. Ask each group to present its list. The purpose of this exercise is help students better understand trust-building and trust-damaging behaviours through shared experiences. Try to get students to share stories and identify how the behaviours described in those stories match one or more of the five components of trust. Experiential Exercises Building Relationships after the Sale Objective: Your students will discover the importance of follow-up activities in building relationships. Time Required: 10 to 15 minutes, or longer if working in groups. Teaching Tip: Have students work in small groups to develop answers to the questions. Then let each group present its answers to the rest of the class. Not many years ago, salespeople often thought that their jobs were complete once the order was signed. Today, for a business to survive, repeat business is critical. A greater emphasis has been placed on the follow-up stage of the selling process. Continued building of the relationship should be your goal well after the sale. 1. Show appreciation after the sale. How might you accomplish this? Showing appreciation after the sale can be accomplished through various methods: 1. Thank You Notes: Sending personalized thank you notes expressing gratitude for the customer's business. 2. Follow-Up Calls: Making follow-up calls to ensure customer satisfaction and address any concerns or questions. 3. Exclusive Offers: Providing exclusive offers or discounts as a token of appreciation for their patronage. 4. Customer Feedback: Soliciting feedback from customers to demonstrate that their opinions are valued and to identify areas for improvement. 5. Customer Events: Inviting customers to exclusive events or webinars to show appreciation and foster a sense of community. 6. Small Gifts: Sending small gifts or samples related to their purchase to enhance the post-sale experience. 2. Monitor delivery and installation. Why is this important? Monitoring delivery and installation is important because it ensures that the customer receives the product or service as promised, enhancing satisfaction and trust in the relationship. Additionally, addressing any issues promptly during this stage helps mitigate potential dissatisfaction and reinforces the salesperson's commitment to customer success. 3. Learn the names of the switchboard operator, receptionists, office manager, users of the product, etc. How might you accomplish this and why is it important? You can accomplish learning the names of various contacts by asking during initial interactions, checking company directories, or connecting on professional networking platforms. It's important because addressing individuals by name demonstrates respect and builds rapport, fostering stronger relationships and facilitating smoother communication throughout the organization. Video Exercises Building Trust and Sales Ethics Scene 1A, Meet the Eager Beaver, run time 2:42 minutes Professional salespeople will face a number of situations that will require that they make ethical choices throughout their careers. Sales people will relate with a multitude of people who are competitors and may want to use this relationship to gain information, an ethical dilemma that Lisa faces. Mark – Manager for Player One Lisa – Sales Rep for Alpha Tech – Security system provider trying to earn the customer away from Goodman Jim – Sales Rep for Goodman – Current provider of security system Ask your students: 1. Which area of unethical behaviour does Mark want Lisa to engage in? Mark wants Lisa to share with him information about how much one of his competitors paid for its security system software. If Lisa were to share that information, she would be engaging in noncustomer-oriented behaviour. 2. Discuss how Lisa’s answer can institute trust in her relationship with Mark as well as avoid her engaging in unethical behaviour. Lisa’s avoidance of breaching the confidentiality she shares with her other customer serves to ensure Mark that she can be trusted with his company’s information. It is important to note that while sharing such information may seem useful in the short run (i.e., help get a sale), it is unlikely that prospective clients would ever truly trust a salesperson who does so. In fact, the buyer could have been testing the salesperson’s integrity, and may not really be concerned about the information. Chapter 2 Case Cabot Business Stationery Background Kelly Myers has spent the past three months trying to gather all the information she needs to submit a bid on an order that is very important to her company. Bids are due tomorrow and the decision will be made within a week. She has made a great impression on the purchasing agent, Janet Williams, and she has just ended a conversation with her sales manager who believes Kelly needs to make one more call on Williams to see if she can find out any additional information that might help her prepare the bid. Kelly’s boss specifically wants to know who the other bidders are. Current Situation Later that day, Kelly visited with Janet Williams. During the course of the conversation with Williams, Kelly asked who the other bidders were. Williams beat around the bush for a while, but she did not reveal the other bidders. She did mention the other bids were in and pulled the folder out of the filing cabinet where they were kept. Janet opened the file and looked over the bids in front of Kelly. There was a knock on the door and Janet’s boss asked if he could see her for a minute and she walked down the hall with her boss. Kelly realized all the bids were left out in front of her. There was a summary sheet of all of the bids on top and she could easily see all the bids. When Williams returned, she returned the folder to the file and the two made some small talk and ended their conversation. Kelly returned to her office and completed her bid and turned it in to Janet Williams the next morning. Kelly knew her bid would be the lowest by $500.00. One-week later Kelly learned she won the bid. Discussion Questions 1. What are the ethical issues involved in this situation? The main ethical issue in this situation is the potential breach of confidentiality. Janet Williams inadvertently exposed the bids of other competitors to Kelly Myers, which could be considered unethical as it violates the confidentiality of the bidding process. Kelly, on the other hand, faces an ethical dilemma regarding whether to use the privileged information she gained to gain a competitive advantage in her bid. 2. If you were Kelly Myers, do you think Janet Williams intended for you to see the competitive bids? What would you have done, given this situation? Why? Customer Orientation: It should be highlighted that Kelly did not demonstrate customer-oriented behaviour and that although her actions may have achieved that sale this one time, she may experience short-term gain, yet long-term pain. Kelly breached the confidentiality she shared with Janet and it is unlikely that Janet would ever truly trust Kelly in the future. If Janet did do this with intention, she may have been testing Kelly’s integrity. As Kelly Myers, it's difficult to determine Janet Williams' intentions regarding the exposure of the competitive bids. While Williams may not have directly intended for Kelly to see the bids, her actions inadvertently led to the exposure of sensitive information. In this situation, I would have recognized the ethical implications of viewing the competitive bids and refrained from exploiting the situation for personal gain. Using privileged information gained through unethical means would compromise the integrity of the bidding process and damage the trust between the parties involved. Instead, I would have respectfully addressed the inadvertent exposure of the bids with Janet Williams upon her return. I would emphasize the importance of maintaining confidentiality in the bidding process and suggest implementing measures to prevent similar incidents in the future. This approach demonstrates integrity, professionalism, and a commitment to ethical conduct in business dealings. Chapter 2 Role Play Reef Uniform Company Case Background Reef Uniform Company (RUC) specializes in providing uniforms to hotels and restaurants. RUC is a new company from Australia trying to break into the Canadian market. They have had trouble breaking into larger accounts (Marriott, Delta, Sheraton) because, as a new company, they don’t have name recognition in Canada. As the account exec in the area, you have been working on a new Sheraton hotel with over 5,000 rooms and 500 employees. You recently submitted a proposal and the buyer, Anthony Norman, has told you he is leaning your way with the order. He also told you that this order must come off without a hitch as his hide is on the line if things go wrong. You know there could be a problem down the road as one of your unions has been negotiating a contract that is about to expire. The last time this contract came up, there was a strike and orders were backlogged for weeks. The hotel has many customized uniforms and has to have these for their grand opening in three months. What is your obligation to the hotel having this information? This order will make your year and probably send you on a trip to Rome for exceeding quota. Role Play Location—Anthony Normans Office; Action—Role plays a sales call with Anthony Norman, addressing the issues in the case. Chapter 2 Continuing Case Because the National Copier Company (NCC) has only been in business for five years, Brenda Smith is concerned that most of her competitors are older than she is. The prospective customers she has been calling on state they know they can count on her competitors because they have a long track record. As NCC expands into new markets, some of her prospects are not familiar with her company. One prospective customer, who works for one of the most prestigious and largest medical offices (30 doctors) in the area, told her he has been buying copiers from the same company for over 25 years. He also told her his sales representative for the company has been calling on him for over seven years, and he knows when he calls on his copier supplier for advice, he can count on him for a solid recommendation. Brenda realizes these are going to be tough accounts to crack. Brenda does have an advantage due to the high quality of NCC products. In a recent trade publication, NCC’s copiers tied for first in the industry on ratings of copier quality and dependability. NCC was also given a high rating for service. Brenda has had this information for two weeks now and has brought it up in conversations with her prospective customers without much success. To make matters worse, one of her competitors must have started rumours about NCC. In the past month, she has heard the following rumours: •“NCC is going out of business because of financial troubles.” •“NCC has missed several delivery deadlines with customers.” •“NCC’s copiers have a software glitch that cannot be corrected.” •“NCC has cut its service staff.” Brenda knows these rumours are not true, but prospects might believe the rumours. At a recent sales meeting, Brenda’s manager suggested that their competitors must be getting nervous about NCC’s success, causing them to start such vicious rumours. Brenda is sitting at her desk trying to figure out what to do next and she is not exactly sure how to proceed. Questions 1. What would you recommend Brenda do to handle the challenges she faces? To handle the challenges she faces, Brenda should take proactive steps to address each issue: 1. Build Trust Through Relationships: Brenda should focus on building strong relationships with prospective customers by demonstrating NCC's commitment to quality, reliability, and customer service. She can leverage her existing relationships with satisfied customers to provide testimonials and referrals, showcasing NCC's track record of success. 2. Combat Rumors with Facts: Brenda should directly address the rumors circulating about NCC by providing factual information to refute them. This could include sharing financial reports to dispel concerns about NCC's financial stability, providing evidence of on-time deliveries and addressing any software glitches, and highlighting NCC's continued investment in service staff to maintain high-quality support. 3. Highlight NCC's Competitive Advantages: Brenda should emphasize NCC's advantages, such as the recent industry ratings for copier quality and dependability, in her conversations with prospective customers. By showcasing NCC's superior products and service, Brenda can differentiate NCC from competitors and instill confidence in potential buyers. 4. Educate Prospects: Brenda should educate prospective customers about the benefits of choosing NCC, including the advantages of working with a newer company that is innovative, agile, and responsive to customer needs. She can highlight NCC's commitment to product excellence, ongoing research and development efforts, and flexibility to adapt to changing market demands. 5. Provide Solutions to Customer Concerns: Brenda should address any specific concerns or objections raised by prospects by offering tailored solutions and addressing their needs. By actively listening to customer feedback and addressing their concerns, Brenda can demonstrate NCC's dedication to customer satisfaction and problem-solving. 6. Persistence and Patience: Brenda should remain persistent and patient in her efforts to win over tough accounts. Building relationships and gaining trust takes time, especially when competing against long-standing competitors. Brenda should continue to engage with prospects, follow up regularly, and demonstrate NCC's value proposition consistently over time. By taking these proactive measures, Brenda can overcome the challenges she faces and position NCC as a competitive and trustworthy choice for prospective customers. 2. Brenda appears to have an advantage with her products and services. Develop a plan for Brenda to build trust in NCC with prospective customers. Brenda can build trust in NCC with prospective customers by implementing the following plan: 1. Address Rumors Head-On: Brenda should directly address the rumors circulating about NCC by providing factual information to refute them. This could include sharing financial reports, providing evidence of on-time deliveries, addressing any software glitches, and highlighting NCC's continued investment in service staff. 2. Leverage Quality Ratings: Brenda should emphasize NCC's recent industry ratings for copier quality and dependability in her conversations with prospective customers. She can highlight NCC's commitment to excellence and reliability, showcasing how these ratings validate the superiority of NCC's products and services. 3. Provide Testimonials and Case Studies: Brenda should gather testimonials and case studies from satisfied NCC customers and share them with prospective clients. Hearing positive experiences from other businesses will help instill confidence in NCC's capabilities and reliability. 4. Offer Guarantees and Warranties: Brenda can offer guarantees and warranties on NCC's products and services to reassure prospective customers of their quality and reliability. These assurances can help alleviate concerns about potential risks associated with choosing a newer company. 5. Demonstrate Expertise and Support: Brenda should demonstrate NCC's expertise and commitment to customer support by providing personalized demonstrations, training sessions, and ongoing assistance. By showing prospective customers that NCC is dedicated to their success, Brenda can build trust and strengthen relationships. 6. Engage in Relationship-Building Activities: Brenda should focus on building strong relationships with prospective customers by engaging in regular communication, providing valuable insights and advice, and demonstrating a genuine interest in their needs and goals. Building rapport and trust over time will increase the likelihood of securing their business. By implementing these strategies, Brenda can effectively build trust in NCC with prospective customers, overcome any doubts or concerns, and position NCC as a reliable and trustworthy partner for their copier needs. 3. What do you recommend Brenda do to compete effectively against competitors that have a long and successful track record? First, Brenda needs to engage in activities designed to develop a sense of compatibility with her customers. This will help her gain access and build trust. In addition, Brenda needs to become an expert in her industry and market, knowing exactly how her products compare with those of her competitors. Using this information, Brenda needs to look for opportunities arising based on her product’s (and company’s) competitive advantages, and/or her customers’ dissatisfaction with their copier providers. 4. How should Brenda go about handling the rumour mill? Brenda can handle the rumor mill effectively by taking the following steps: 1. Address Rumors Directly: Brenda should address each rumor directly and provide factual information to refute them. She can communicate with prospective customers through personalized messages, phone calls, or meetings to clarify any misconceptions and provide reassurance. 2. Provide Evidence and Documentation: Brenda should gather evidence and documentation to support her rebuttal of the rumors. This could include financial statements, records of delivery schedules, testimonials from satisfied customers, and technical reports validating the quality of NCC's products and services. 3. Communicate Proactively: Brenda should proactively communicate with both existing and potential customers to keep them informed about NCC's business operations and address any concerns they may have. Regular updates via newsletters, email campaigns, or social media posts can help counteract negative rumors and maintain transparency. 4. Engage Influential Supporters: Brenda can enlist the support of influential customers, industry partners, or stakeholders who can vouch for NCC's reputation and credibility. Testimonials and endorsements from trusted sources can help validate NCC's reliability and counteract negative rumors effectively. 5. Monitor and Respond: Brenda should actively monitor online forums, social media platforms, and industry publications for any mentions of NCC or related rumors. Promptly responding to misinformation and providing accurate information can help mitigate the spread of rumors and prevent further damage to NCC's reputation. 6. Focus on Positive Messaging: Brenda should emphasize NCC's strengths, achievements, and positive attributes in her communications with customers. By highlighting NCC's commitment to quality, reliability, and customer satisfaction, Brenda can shift the focus away from negative rumors and reinforce NCC's credibility. By adopting a proactive and transparent approach to handling rumors, Brenda can effectively mitigate their impact on NCC's reputation and maintain trust with customers and prospects. Solution Manual for SELL Thomas N. Ingram, Raymound W. (Buddy) LaForge, Ramon A. Avila, Charles H. Schwepker, Michael R. Williams, Kirby Shannahan 9780176622107