Preview Extract
This Document Contains Chapters 8 to 9 Chapter Eight — Addressing Concerns and Earning Commitment Learning Objectives 8-1 Explain why it is important to anticipate and overcome buyer concerns and resistance. 8-2 Understand why prospects raise objections. 8-3 Describe the five major types of sales resistance. 8-4 Explain how the LAARC method can be used to overcome buyer resistance. 8-5 Describe the recommended approaches for responding to buyer objections. 8-6 List and explain the techniques for earning commitment that secure commitment and closing. Chapter Outline Introduction-189 Addressing Concerns-190 8-1 Anticipating and Negotiating Concerns and Resistance-190 8-2 Reasons Why Prospects Raise Objections-190 8-3 Types of Sales Resistance-191 8-4 Using LAARC: A Process for Negotiating Buyer Resistance-195 8-5 Recommended Approaches for Responding to Objections-198 8-6 Securing Commitment and Closing-201 Guidelines For Earning Commitment-202 Techniques to Earn Commitment-203 Probe to Earn Commitment-205 Traditional Methods-205 Chapter 8 Case-207 Chapter 8 Role Play-208 Exercises Developing Professional Selling Knowledge 1. Why is it important for a salesperson to anticipate a buyer’s concerns and objections? There are a couple of reasons why it is important for salespeople to anticipate a buyer’s concerns and objections. First, by anticipating a buyer’s concerns and objections, the salesperson is less likely to be “derailed” when he or she hears them. Second, anticipating concerns and objections allows the salesperson time to prepare and develop an appropriate response strategy. Finally, the process of anticipating a buyer’s concerns and objections may help the salesperson learn more about his or her market offer and his or her customers. 2. Is one type of sales resistance (e.g., need, price) more difficult to handle than another (e.g., source, product, time)? Yes, some types of sales resistance are more difficult to handle than others. For example, company or source objections, such as loyalty to a current supplier, are typically more difficult to handle than a price objection. That being said, taking the time to adequately prepare for objections helps to make each of them easier to handle. 3. Should the direct denial method ever be used? The direct denial method is risky because it may cause the buyer to feel angry or defensive. However, it may be used when the salesperson has a good feel for the relationship he or she has with the buyer. 4. Some trainers have been heard to say, “If a salesperson gets sales resistance, then he or she has not done a very good job during the sales presentation.” Do you agree with this? Generally speaking, people are naturally resistant to change. Therefore, it is only natural that buyers offer some resistance when considering a salesperson’s market offer. Moreover, buyer resistance is often an indicator that the buyer is interested in what the salesperson is presenting. Buyers expressing no resistance through the sales presentation are typically uninterested and rarely make any sort of affirmative commitment. 5. Under what circumstances does a salesperson want sales resistance? Generally, a salesperson wants sales resistance when overcoming that resistance strengthens the buyer’s reasons/motivation to purchase the salesperson’s product. For example, because a buyer is not aware of recent technological innovations, he or she may not believe that the salesperson’s new high-tech product is capable of delivering the desired benefits. Once convinced that such technology exists, the buyer’s resistance turns into a reason to buy. 6. Are there ever going to be situations where the salesperson can’t overcome sales resistance? Yes, there will be situations where the salesperson will not overcome sales resistance. In these situations, the salesperson needs to move on. If the resistance is not significant, the salesperson should try to advance the sale. If the resistance is significant (i.e., deal killer), the salesperson should abandon the sales process, at least temporarily, making sure to avoid doing or saying anything that would damage the relationship with the buyer. The salesperson should then evaluate the resistance and subsequently develop a strategy for handling that type of resistance in the future. 7. Some trainers and sales experts think that closing is the most important stage of the sales process. Do you feel this way? Although some students may agree with this statement, it is not consistent with relationship selling. If the salesperson successfully uncovers the buyer’s needs and then is able to show the buyer how his or her market offer will solve those needs, a successful close should follow naturally and with little difficulty. However, most salespeople will have tremendous difficulty closing, regardless of closing technique, if the buyer does not perceive any benefit resulting from making a purchase. 8. Why should salespeople have many closing techniques ready to use during a sales call? Explain. This question is somewhat misleading in that salespeople really shouldn’t worry about having many closing techniques ready to use during a sales call. While salespeople should anticipate and be prepared for the commitment stage, they should focus their efforts on uncovering and satisfying the buyer’s needs. The ability to provide a value-added solution will probably have the greatest influence on the buyer’s level of commitment; however, knowing a few methods for obtaining commitment should increase the probability that the salesperson will be able to do so successfully. Nevertheless, salespeople should not develop such reliance on closing (or objection handling) techniques that they lose focus on their ability to uncover and satisfy the buyer’s needs. 9. Can the LAARC method be used for all types of sales resistance? Explain. The LAARC method, which stands for Listen, Acknowledge, Assess, Respond, and Confirm, is a versatile approach that can be effectively used to address various types of sales resistance. Here's how it can be applied: 1. Listen: Regardless of the nature of the sales resistance, active listening is always the first step. By attentively listening to the concerns, objections, or hesitations expressed by the prospect, salespeople can gain valuable insights into the underlying reasons behind the resistance. 2. Acknowledge: Once the prospect has voiced their concerns, it's essential to acknowledge their perspective and validate their feelings. This step involves empathizing with the prospect and demonstrating understanding of their viewpoint, which helps build rapport and trust. 3. Assess: After acknowledging the prospect's concerns, salespeople need to assess the situation to determine the root cause of the resistance. This involves asking probing questions to delve deeper into the prospect's objections and uncover any hidden issues or underlying motivations. 4. Respond: Armed with a clear understanding of the prospect's objections, salespeople can formulate tailored responses to address each concern effectively. This may involve providing relevant information, offering solutions or alternatives, or addressing any misconceptions or misunderstandings. 5. Confirm: Finally, it's crucial to confirm that the prospect's concerns have been adequately addressed and that they are satisfied with the responses provided. This step involves seeking feedback from the prospect to ensure that their objections have been resolved to their satisfaction. Overall, the LAARC method provides a structured framework for handling sales resistance by promoting active listening, empathy, problem-solving, and effective communication. While the specific responses may vary depending on the nature of the resistance, the underlying principles of the LAARC method can be applied universally to address various types of objections and concerns raised by prospects. 10. What is the best method to handle sale resistance? While there is probably no “one best method” to handle sales resistance, salespeople should stick to those methods that are relationship-oriented rather than the traditional methods. However, the type of method that will be most effective varies depending upon the type and circumstances of the resistance. The best thing salespeople can do to handle resistance is to anticipate objections, ask good questions, and listen carefully. Group Activity Putting the Pieces Together: Creating a Job Search Strategic Plan and Preparation Guide In this section of the guide, students should envision themselves in an interview situation and then •List objections that recruiters might have during an interview, and develop and describe strategies for overcoming each objection •List at least two strategies for gaining the recruiters’ commitment (to either offering the job or a second interview) This section should be written in such a way that students are able to readily refer to it (and learn from it) when they are in their search of post-graduation employment. Experiential Exercises Why Salespeople Fail to Gain Commitment Objective: Your students will be able to understand the issue of failure in gaining commitment. Time Required: 10 to 15 minutes Teaching Tip: This exercise is excellent to use as a review following a lecture or class discussion on gaining commitment or fear of closing. Have the students complete this exercise individually or in small groups. Sample answers are provided below. One reason why sales are not completed is that the salesperson makes no attempt to close the sale. Why, after investing all the time and effort in prospecting, qualifying, and making the presentation, would a salesperson not attempt to gain commitment? What are some other reasons why salespeople fail to gain commitment? Record your responses on the following lines. 1. Fear of the word “NO” 2. Lack of conviction that product features/advantages/benefits meet customers’ needs 3. Waiting until the end of the presentation to gain commitment when the customer was ready to make a decision earlier 4. Simply not asking for the order 5. Failure to generate agreement on key points during the presentation 6. Prospect has objections Video Exercise Addressing Concerns and Earning Commitment Scene 2B, A Helping Hand, run time: 2:20 minutes Handling objections and earning trust is one of the most important roles that a salesperson plays. Price is one of the most common forms of buyer resistance to purchasing a product or service. This request may be a request to the salesperson to justify to the prospect how they can afford the product and work it into their budget. In this scene, Jim faces a pricing objection from Mark. Ask your students: 1. How does Jim use the LAARC process in his interaction with Mark? Listen: Jim appears to listen to Mark’s concern. Acknowledge: Jim does not verbally acknowledge Mark’s concern (although he does nod and smile). Assess: Jim does try to assess Mark’s concern by asking an activation question. In this case, he’s trying to get Mark to re-evaluate the value of working with a higher-priced but more reliable provider. Respond: Jim does respond with statements justifying the higher price based on his company’s reputation for reliability and longevity. Confirm: Jim hasn’t finished handling this objection. Instead, the buyer has asked for an addendum highlighting the reasons for the higher price and any price reductions Jim could make. 2. Do you think that Jim can overcome this objection? Discuss how you feel he handled the price resistance. Yes, Jim can overcome the pricing objection by effectively addressing Mark's concerns and demonstrating the value proposition of the product or service relative to its price. Jim should focus on highlighting the benefits and return on investment that the product offers, emphasizing its long-term value rather than just its initial cost. Additionally, Jim can offer flexible payment options or incentives to make the purchase more financially feasible for Mark. Overall, how Jim handles the price resistance will depend on his ability to effectively communicate the product's value and address any specific concerns Mark may have about affordability. Chapter 8 Case Martichenko Engineering Background Rob Dwhytie sells for Martichenko Engineering. He has been calling on Hudson Distributors for close to two years. Over the course of 15 calls, he has sold nothing to date. During an early call, Dwhytie had Hudson’s engineers in to look over and test the quality of his products. The tests and the engineer’s responses were positive. He thinks that he is extremely close to getting an order. Dwhytie knows that Hudson is happy with its present supplier, but he is aware that they have received some late deliveries. Tom Harris, Hudson’s senior buyer, has given every indication that he likes Dwhytie’s products and Dwhytie. Current Situation During Dwhytie’s most recent call, Harris told him that he’d need a couple of weeks to go over Dwhytie’s proposal. Harris really didn’t have any major objections during the presentation. Dwhytie knows his price, quality, and service are equal to or exceed Hudson’s present supplier. Questions 1. Harris told Dwhytie that he needed a couple of weeks to think about his proposal. How should Dwhytie handle this? Dwhytie should probe to find out why Harris needs a couple of weeks to think about the proposal. Dwhytie should assertive but not aggressive with his request. Dwhytie should be prepared handle whatever concern emerges from the discussion. If the buyer maintains he just needs more time, Dwhytie should agree with the decision and schedule a follow-up meeting. 2. What should Dwhytie have done during the sales presentation when Harris told him that he needed to think it over? When Harris told Dwhytie that he needed to think it over, Dwhytie should have acknowledged Harris's request respectfully and probed further to understand his concerns or reservations. Dwhytie could have asked Harris questions to uncover any specific issues or objections he might have, allowing him to address them directly. Additionally, Dwhytie could have offered to provide more information or address any additional concerns Harris might have before making a decision. This approach demonstrates attentiveness to Harris's needs and a willingness to support him throughout the decision-making process. 3. What techniques should Dwhytie have used to overcome the forestalling tactic? Dwhytie should continue to probe in order to learn the true cause of the resistance. To overcome the forestalling tactic used by Harris, Dwhytie could employ several techniques: 1.Reframe the request: Dwhytie could respectfully reframe Harris's request to think it over as an opportunity to address any concerns or questions he might have, emphasizing the importance of ensuring that all aspects are thoroughly considered before making a decision. 2.Create urgency: Dwhytie could gently emphasize the importance of moving forward with the decision to avoid delays or missed opportunities, especially if there are time-sensitive factors involved in the decision-making process. 3.Offer additional support: Dwhytie could offer to provide additional information, resources, or assistance to help Harris make an informed decision, demonstrating a commitment to addressing any concerns or uncertainties he may have. 4.Seek commitment: Dwhytie could gently encourage Harris to commit to a specific timeline for making a decision, setting clear expectations and accountability for the next steps in the process. 5.Build trust and rapport: Dwhytie could focus on building a trusting relationship with Harris, emphasizing his dedication to supporting Harris's needs and goals throughout the decision-making process. This can help alleviate any hesitations or reservations Harris may have about moving forward. Role play Situation: Read Case 8; Martichenko Engineering Characters: Rob Dwhytie, sales representative; Tom Harris, senior buyer Scene 1: Location—Harris’ office; Action—Harris has just stated that he needs a couple of weeks to go over Dwhytie’s proposal. Role play how Dwhytie should respond to Harris’ needing two weeks to think it over. Scene 2: Location—Harris’ office; Action—Dwhytie is summarizing his product’s advantages (i.e., price, quality, service). Role play Dwhytie’s summary and his asking for the order. Upon completion of the role plays, address the following questions (for in-class discussion): 1. Why do buyers hesitate and ask for more time to think over proposals? Buyers often hesitate and ask for more time to think over proposals due to various reasons such as needing to consult with other stakeholders, wanting to review all available options, assessing budget constraints, or simply needing more time to make a well-informed decision. They may also use this as a tactic to delay making a commitment or to gather more leverage in negotiations. 2. How hard should Dwhytie press to get Harris to act now? Dwhytie should strike a balance between respecting Harris's need for time to consider the proposal and gently pressing for a decision. He can emphasize the importance of timely action, especially if there are time-sensitive factors involved, while also offering support and assistance to address any concerns or uncertainties Harris may have. Dwhytie should aim to maintain a sense of urgency without appearing overly pushy or aggressive, ultimately guiding Harris towards making a confident and informed decision. Chapter 8 Role Play A Campbell Engineering Dan Harris has been selling for A Campbell Engineering for six months. Most of the first four months were spent in training learning A Campbell’s products. He spent another two weeks learning their selling process and shadowed one of their senior reps for a couple of weeks. He has barely been in the field a month and is feeling frustrated. Dan was given a hot lead the first day in the field (Parker Distributors), and the past four weeks he has made seven calls on Parker. Dan feels he is close to getting an order from Parker. Dan knows Parker is fairly happy with their present supplier, but he is aware that they have received several late deliveries. Karen Williams, Parker’s senior buyer, has given every indication that she likes A Campbell’s products and Dan. During Dan’s most recent call, Williams told him she’d have to have a couple of weeks to go over his proposal. Williams really didn’t have any major objections during his presentation. Dan knows his price, quality, and service are equal to or exceed Williams’s present supplier. Williams did say she wasn’t looking forward to calling their present supplier to tell them about doing business with A Campbell Engineering if she decided to change. Role Play Location: Karen Williams’ office Action: Role play Karen Williams telling Dan Harris she needs a couple of weeks to think over his proposal. Discuss the sales resistance of forestalling Williams is using and how Dan is going to overcome the objection (use LAARC). Also, role play Williams’s concern, telling her present supplier they are switching suppliers. Chapter 8 Continuing Case Handling Sales Resistance Brenda recently returned from a two-week training session that focused on how to handle sales resistance and how to earn commitment. Brenda has become quite familiar with the ADAPT questioning system and knows she must use assessment questions to allow the buyer to describe their present situation. She has also developed a pretty good set of discovery questions that helps her identify the buyer’s pain and problems. Her challenge has been what to do with this information. Whenever Brenda attempts to use features and benefits to make her case, she encounters a myriad of objections. Brenda knows she has great products and service, but she has not been able to communicate this effectively to her prospects. The objection she hears most often is, “I’ve never heard of your company; how long have you been in business?” If that is not bad enough, she heard the following objections in just one morning: •“I’m not sure I am ready to buy at this time, I’ll need to think it over.” •“Your company is pretty new. How do I know you’ll be around to take care of me in the future?” •“Your price is a little higher than I thought it would be.” •“Your company was recently in the news. Are you having problems?” •“I think your company is too small to meet our needs.” Brenda hears most of these objections right after she attempts to earn a commitment. She is now getting a little reluctant about asking her prospects for the order. Brenda is sitting at her desk trying to figure out what to do next. She is not exactly sure how to proceed. Questions 1. What would you recommend Brenda do to handle the challenges she faces? First, Brenda needs to understand that objections are a natural part of the sales process and often indicate that the buyer has at least some interest. Next, Brenda needs to review the various methods for handling sales resistance, including the LAARC strategy. She should then review the objections she hears frequently and then develop and rehearse a response strategy. Doing so will help build her confidence and improve her ability to handle resistance. 2. Brenda appears to have an advantage with her products and services. Develop a plan for Brenda to overcome the sales resistance she is receiving. Brenda can overcome sales resistance by implementing the following plan: 1. Build Credibility: Highlight the company's achievements, awards, or notable clients to establish credibility and reassure prospects about the company's stability and reliability. 2. Address Concerns Proactively: Anticipate objections about the company's longevity and size by proactively addressing them in the sales pitch. Emphasize the company's vision, growth trajectory, and commitment to customer satisfaction. 3. Demonstrate Value: Focus on the unique features and benefits of the products and services that address the prospect's pain points and differentiate Brenda's company from competitors. Use case studies or testimonials to showcase successful implementations. 4. Provide Assurance: Offer guarantees, warranties, or service level agreements to alleviate concerns about future support and ensure the prospect's peace of mind. 5. Handle Objections Effectively: Equip Brenda with rebuttals to common objections, such as explaining the company's stability, competitive pricing justified by superior quality, and proactive measures to address any perceived issues highlighted in the news. 6. Follow-Up and Build Relationships: Maintain regular communication with prospects to address any lingering concerns, provide additional information, and build trust over time. Focus on nurturing long-term relationships rather than immediate sales. 7. Training and Development: Provide ongoing training and support to Brenda on objection handling techniques, effective communication strategies, and product knowledge to enhance her confidence and effectiveness in sales interactions. By implementing this plan, Brenda can effectively overcome sales resistance, build trust with prospects, and increase her success rate in closing deals. 3. Use the LAARC process to develop the suggested dialogue Brenda can use to address one of the major types of resistance she is receiving. Listen: She will need to listen as the buyer expresses, “Your price is a little higher than I thought it would be.” Acknowledge: “Okay, so you’re concerned that the price is too high?” Assess: “Is the price greater than what you were planning to spend, or do think the price too high relative to our competitors’ prices?” Respond: “It’s true, the price of our copiers is about $200 higher than the prices of our competitors’ copiers. However, the operating and maintenance cost of our copiers is 50% lower than those of our competitors. Within 12 months you’ll have made up the difference and within two years you’ll have saved hundreds of dollars. The average life of a copier is 8 years, bringing your total savings to around $2000. Confirm: “Given that information, do you still feel the price is too high?” 4. What can Brenda do in the future to encounter less sales resistance when she asks for the order? There are a variety of things Brenda can do to encounter less sales resistance. First, she may need to work on her prospecting skills (in particular, qualifying). Second, while she feels confident about her questions skills, she may need to work on integrating the information she obtains during need discovery into her presentation of solutions. In particular, the answers to activation and projection questions should be useful. Third, she may need to work on presenting solutions. She needs to make sure her customers agree that the solutions she’s presenting are important and viable in their respective organizations. Finally, she needs to include more response-checks to ensure her customers are “buying into” her solutions before asking for the order. Chapter Nine — Expanding Customer Relationships Learning Objectives 9-1 Explain how to follow up to assess and take action to ensure customer satisfaction by using the latest technology. 9-2 Discuss how to expand collaborative involvement. 9-3 Explain how to add value and enhance mutual opportunities. Chapter Outline Introduction-211 9-1 Assess Customer Satisfaction-213 Harness Technology and Enhance Follow-Up and Buyer–Seller Relationships-214 Ensure Customer Satisfaction-216 Provide Useful Information-217 Expedite Orders and Monitor Installation-219 Train Customer Personnel-219 Correct Billing Errors-220 Remember the Customer after the Sale-220 Resolve Complaints and Encourage Critical Encounters-221 9-2 Expand Collaborative Involvement-225 9-3 Work to Add Value and Enhance Mutual Opportunities-226 Provide Quality Customer Service-226 Meet Customer Expectations-227 Develop a Service Strategy-227 Customer Service Dimensions-228 Chapter 9 Case-230 Chapter 9 Role Play-232 Exercises Developing Professional Selling Knowledge 1. How can a salesperson convert new customers into highly committed customers for life? Customers become committed for life only after the salesperson has proven himself or herself to the customer over a period of time. This entails building goodwill by continually creating and delivering value, resolving complaints, and processing special requests as needed (and where appropriate). In other words, add value and never let the customer down during one of the many “moments of truth.” 2. Why should a salesperson follow up to assess customer satisfaction? Salespeople should follow up to assess customer satisfaction to ensure that the customer’s expectations have been met and, as a result, trust has been built. Most customers will not complain when they experience dissatisfaction (unless the dissatisfaction is great) or when their expectations have not been met. They will, however, often express their dissatisfaction to others (negative word-of-mouth) and question whether they want to continue doing business with the salesperson and the salesperson’s organization. If salespeople do not follow up, they will never know that their customers are dissatisfied and will consequently never have a chance to correct the problem. 3. Explain why relationship-enhancement activities are important. Relationship-enhancement activities are important to the growth and development of long-term relationships. Long-term relationships are desirable because selling costs are reduced (relative to finding new customers) and sales are more secure and predictable. In addition, salespeople want their relationships with buyers to be strong enough to withstand minor problems and/or the overtures of the competition. 4. What does a salesperson hope to accomplish by providing his or her customers with useful information after the sale? Providing their customers with useful information after the sale is another way for salespeople to add value. By doing so, salespeople hope to strengthen the relationship and build trust. Ultimately, salespeople hope to accomplish the establishment of a long-term, mutually beneficial relationship with their customers. 5. Most salespeople are not trained in how to install their products. Why then should a good salesperson make it a point to oversee the installation process? Most salespeople are not trained in how to install their products, and most installers are not trained in how to deal with customers. A good salesperson will make it a point to oversee the installation process so that he or she can ensure the customer’s expectations are met. If problems arise, the salesperson is usually best suited for smoothing out rough spots and correctly handling customer concerns. In addition, overseeing the installation process helps to build a customer’s trust in the salesperson and will strengthen the relationship. 6. Why is it important for a salesperson to ask a buyer what he or she wants the salesperson to do when resolving the complaint? When a customer complains, the goal of the salesperson should be to resolve the complaint to the customer’s satisfaction. The most effective way to determine what will satisfy the customer is simply to ask. Asking the customer what it will take to resolve the complaint also gives the customer ownership in the resolution and may prevent the salesperson from doing too much or too little. Finally, asking the customer how to resolve a complaint demonstrates the salesperson’s customer orientation and should serve to strengthen the relationship. 7. Why should a salesperson encourage his or her customers to complain? Isn’t this just asking for trouble? Salespeople should encourage their customers to complain so that they may be aware of, and have the chance to fix/address, even the smallest of customer concerns. Not only will this serve to strengthen the relationship, but it will also give salespeople continuous feedback on both their personal performance and their company’s performance. 8. Why is it important for a salesperson to gain agreement on a solution when dealing with a customer complaint? In the process of gaining agreement, the salesperson should be clear about what he or she can and cannot do for the customer. It is important for a salesperson to gain a customer’s agreement on a proposed complaint resolution to ensure the customer has clear and accurate expectations. Gaining agreement also helps the salesperson know that the customer perceives fairness in the resolution and serves to reduce the likelihood that the customer will harbour any unnecessary ill feelings once the solutions are correctly implemented. 9. Why do many salespeople seem to ignore after-sale activities that enhance the relationship? Many salespeople seem to ignore after sale activities that enhance the relationship because they see their jobs as being over, at least for a while. After making a sale, the salespeople will turn their attention to other customers or new prospects in the hopes of getting additional sales. This may be a critical mistake because neglected customers may decide not to become customers in the future. 10. Why is it important for a salesperson to establish expectations with a new customer? It is important for salespeople to establish accurate expectations with a new customer in order to develop trust and promote customer satisfaction. A customer whose expectations are too high may be dissatisfied with the delivered product, even though the product meets the buyer’s needs. Conversely, a buyer whose expectations are too low may not do business with the salesperson. The salesperson should set the buyer’s expectations high enough to earn the business, but not so high that the customer’s expectations will not be met or exceeded nearly all of the time. Group Activity Divide the students by major and then into groups of three to five. Each group is to assume it has been hired by the university’s placement office (career services). The group’s job is to assess and maintain existing relationships with companies that are registered and are recruiting on campus. Focusing on their own major area, each group should develop a strategy for following up to ensure satisfaction among recruiters. Next, they should identify probable areas of dissatisfaction and a plan for dealing with customers (recruiters) expressing those dissatisfactions. Below is a list of possible areas of dissatisfaction. Dissatisfactions: •Difficult to register with career services •Information on registered students is hard to find •Not enough students are interested in interviewing to make it worth my time to visit campus •It’s difficult to get students interested in our company because they know nothing about us •I get too many resumes with spelling and grammar errors •Students never send us thank you notes after interviewing •Have the groups present their work to the rest of the class. Experiential Exercises What to Do after Gaining Commitment Objective: The sales rep has to complete a number of activities once the order has been signed. Your students will understand what activities must be completed after earning commitment. Time Required: 15 to 20 minutes Teaching Tip: Have students complete this exercise individually or in small groups. Sample answers are provided in the Instructor’s Manual. You are a salesperson calling on your school’s purchasing department. The buyer has just informed you that they have made the buying decision in your favour. What do you do now? Explain how you will accomplish each of the following: 1. Confirm the customers’ decision. I would speak with the buyer and summarize the agreement one more time, making sure both parties have accurate expectations. Then, I would make sure the customer signs the necessary agreement or contract forms. 2. Show appreciation. I would immediately thank the customer and then follow up with a thank-you letter the following day. 3. Cement the relationship. I would provide the customer with a timeline so they know when to expect delivery. I would also provide the customer with additional information that assures them they made the right decision. 4. Monitor delivery. I would work with our order fulfillment staff to make sure I know the progress of the product in the order-fulfillment and delivery process. I would keep the customer updated. 5. Monitor installation. I would be on-site for the installation and available to the customer. I would oversee the installation, answer questions or concerns, and make sure everything is working for the customer, as promised, before leaving. 6. Keep your promises. I would make notes (on paper or electronically) of all promises I make and integrate them into a time management system to keep me on track. 7. Handle complaints with sensitivity. I would follow the complaint resolution process described in the text. Perhaps the most important part of that process is keeping the lines of communication open. I would make sure the customer feels comfortable providing me with any feedback that is positive or negative. I would also maintain regular contact with the customer. 8. Respect the customer’s time. I would always make appointments with the customer and never exceed the agreed length of meeting time, unless it is requested by the customer to do so. 9. Provide information on the care and use of products. I would provide the customer with any pertinent information about the care and use of products prior to or during installation. I would also work with the customer to ensure he or she understands the information and is comfortable with caring for and using the product. 10. Follow-up actions that will cement the relationship between you and your customers. I would build goodwill by maintaining regular contact and looking for ways to add value. I would make sure that I promptly and satisfactorily resolve customer complaints, and I would make sure to follow through on all special requests (where possible and appropriate). Enhancing Customer Relationships Objective: Your students will be able to understand that building mutually satisfying relationships between buyers and sellers is essential for success in sales. Time Required: 15 to 20 minutes Teaching Tip: Have the students complete this exercise individually or in small groups. Sample answers are provided in the Instructor’s Manual. To build mutually satisfying relationships between buyers and sellers, professional salespeople must be competent in accomplishing five ongoing tasks: (1) providing information, (2) reducing risk, (3) establishing high standards and expectations, (4) anticipating and responding to customer problems and concerns, and (5) monitoring and improving customer satisfaction. For each of these, explain what it means and why it is important to building a relationship. Providing Useful Information. Providing useful information means communicating with the customer after the sale and keeping him or her updated on the delivery process, the installation process, and any other pertinent information the customer will find valuable. As time moves on, the salesperson should keep the customer updated with respect to new capabilities, new technologies, and other factors affecting the customer’s business. It is important to provide useful information so that the customer feels good about the purchase decision, trusts the salesperson, and sees value in the relationship with the salesperson. Further, providing useful information to the customer enhances the salesperson’s ability to secure referrals from the customer, and helps to identify additional opportunities with the customer. Reducing Risk. Buyers assume a degree of risk when they agree to purchase from a salesperson. The extent of the risk and the buyer’s risk tolerance will impact the purchase decision. Salespeople need to look for ways to reduce perceived risk before, during, and after the sale. While this can be accomplished through written documentation (e.g., warranties), it is the salesperson’s ability to build trust that has a major impact on the perception of risk. After the sale, it is often the salesperson’s successful management and resolution of a dissatisfaction that can strengthen the relationship and reduce the buyer’s perception of risk. That is, the buyer knows the salesperson will satisfactorily address any problems that arise. Establishing High Standards and Expectations. Salespeople should establish high standards and consistently meet or exceed customer expectations. Establishing high standards means never being satisfied with mediocrity, and having the personal and professional integrity to ensure the standards are met. Setting expectations refers to the extent to which the salesperson clearly communicates to the customer what to expect from the purchase and the relationship. It also means that the salesperson has a clear understanding of what he or she expects from his or her own performance, and the performance of his or her products and company. Establishing high standards and expectations serves to reduce the buyer’s perceived risk, while at the same time building trust and strengthening the relationship. Anticipating and Responding to Customer Problems and Concerns. Anticipating and responding to customer problems and concerns means being aware of the types of concerns that generally arise. It also means being intuitive enough to sense concerns when communicating with the buyer. Responding to concerns refers to the salesperson’s ability to effectively manage and resolve the concern in a timely fashion. Effectively anticipating and responding to customer problems and concerns is important because doing so is essential to trust building and, ultimately, the survivability and profitability of the relationship. Monitoring and Improving Customer Satisfaction. Monitoring and improving customer satisfaction refers to the salesperson’s ability to attend to the customer in a way that allows for the customer to communicate his or her relative satisfaction with the purchase and the relationship. Doing so gives salespeople the opportunity to take care of little problems before they become big problems. Further, keeping customers satisfied builds customer loyalty; and loyal customers are more likely to provide referrals and positive word-of-mouth. Finally, monitoring customer satisfaction provides the salesperson feedback on the factors that drive customer satisfaction and dissatisfaction. This information is useful for future interactions with both current and new customers. Video Exercise Expanding Customer Relationships (Not reviewed) Scene 1A, Meet the Eager Beaver, run time 2:42 minutes Building buyer-seller relationships over time requires more than discovering the buyer needs. Relationships can be cultivated by a salesperson relating an industry newsletter report on the buyer organizations’ operations. In this scene, Lisa relates a new product that Mark’s organization is developing, and injects it during a sales call. Ask your students: 1. After viewing the video clip, comment on the four effective follow-up components that Lisa employs. Interact: This is Lisa’s first face-to-face meeting with Mark. Lisa is effectively interacting with Mark but it’s difficult to determine the extent to which she is maximizing the number of critical encounters. Connect: Lisa is in contact with Mark only (in Player One) and doesn’t appear to be attempting to connect with other individuals within the organization. Know: Lisa does a good job interpreting and integrating Mark’s security needs associate with the new product release and Player One’s planned expansion into a need for a better security system. Relate: Lisa is able to convey to Mark how her company can address Mark’s need for a higher-level security system. 2. Explain why relationship enhancement techniques are important. Relationship enhancement techniques are particularly important for Lisa because she is the “out-supplier.” Lisa’s competitor, Goodman, is currently handling Mark’s security software needs. Being the “in-supplier” gives Goodman an advantage and makes it more challenging for Lisa to secure the business. Anything Lisa can do to enhance her relationship with Mark will help her to overcome the disadvantage. Chapter 9 Case Naturally Beautiful Inc. Background Naturally Beautiful Inc. is a maker and marketer of organic cosmetics. Its cosmetics are formulated from all-natural organic ingredients. Although the company currently serves primarily the higher-end market, distributing through upscale department stores and boutiques, it would like to expand its distribution channels. It is currently developing an organic line to sell through outlets such as drug chains and discount retailers. Long-term plans include expanding internationally, first to the US and Mexico, and eventually Western Europe and beyond. Sales are strong and continue to rise. The company gives much of the credit for its success to its salesforce, which has done a great job expanding into new outlets while establishing and maintaining strong customer relationships. Heather Aunaturale, a nontraditional student, was hired as a sales representative by Naturally Beautiful out of college approximately ten months ago. Since being hired she has had a good deal of success, landing several new accounts. In fact, if she can land a few more accounts by the end of the rapidly approaching fiscal year, she will exceed her quota and achieve a hefty bonus. Heather is counting on this bonus since she has planned a big family trip and does not want to let her family down. Current Situation Lately, Heather has heard various concerns from several of her customers. For instance, the other day she received a voice mail from Rick at Beauty Boutique, a recently acquired customer whose order was incorrect. A few items were missing from the order. Heather figured that shipping must have inadvertently omitted the items and that Rick could give them a call to get it fixed. She figured that it was not her fault, Rick still had product to sell, and she certainly did not have time to mess with this. Similarly, she received a text from Kim at Devine’s department store indicating that that an expected delivery was late. Again, Heather figured she could not do anything about the delivery. She texted Kim to tell her to contact the shipping department at Naturally Beautiful about the matter. Heather also received a second e-mail from Sarah at Cosmetics Unlimited: Dear Heather, A few weeks ago, you promised you would return to train our beauty consultants on your newest product line. Our consultants need to fully understand the benefits of this new product and how it is to be applied so that they can best serve our customers. As you know, we take great pride in providing the highest quality products and services to our customer base. We discussed this when you offered me your line. Although we like your line, if we are unable to offer our customers top-shelf service with your brand then we may have to look elsewhere. Sincerely, Sarah Heather recall’s telling Sarah that she would conduct training for her sales consultants but has been so busy working to get new accounts that she put it on the back burner. Heather was not sure that she could put Sarah off much longer, but felt it would be in her best interest to write her back and stall her for at least a couple more weeks. By then, she thought, she might have exceeded her quota. To Heather, these were but minor customer issues, not even problems in her eyes. In her opinion, these were nothing more than “needy” customers. As far as she was concerned, she was delivering a great product at a great price. Besides, she had more sales to make and nobody was going to help her if she came up short on providing that great family vacation she promised. Questions 1. For each of the concerns expressed by Heather’s customers in the case, explain an alternative means for handling the concern. Handling Customer Concerns: For Rick at Beauty Boutique, Heather could take proactive steps to rectify the missing items from the order. She could contact the shipping department herself to ensure that the missing items are sent out promptly, demonstrating excellent customer service and taking ownership of the issue. In response to Kim at Devine’s department store regarding the late delivery, Heather could apologize for the delay and offer to follow up directly with the shipping department to expedite the delivery. By taking responsibility and actively seeking a solution, she shows commitment to customer satisfaction. Regarding Sarah at Cosmetics Unlimited, instead of stalling, Heather should prioritize fulfilling her commitment to provide training for the beauty consultants. This demonstrates reliability and a willingness to invest in the success of the partnership. She could schedule the training session promptly, accommodating Sarah's needs and ensuring the consultants are well-equipped to promote Naturally Beautiful products effectively. 2. What are the potential long-run implications of how Heather is handling her current customers? Heather's current approach of dismissing customer concerns as minor and neglecting to address them promptly could damage her reputation and erode customer trust over time. Dissatisfied customers are likely to seek alternatives, leading to lost sales and a damaged brand image. Failure to prioritize customer satisfaction may result in negative word-of-mouth, impacting Naturally Beautiful's ability to acquire and retain customers in the long term. It could also hinder the company's expansion plans, as a reputation for poor customer service can deter potential distributors and partners 3. What types of activities can Heather do after acquiring an account to enhance customer value and ensure long-term customer relationships? Activities to Enhance Customer Value and Ensure Long-Term Relationships: Regular communication with customers to gather feedback and address any concerns promptly. Providing ongoing training and support to retailers and partners to ensure they are knowledgeable about Naturally Beautiful products and can effectively promote them to customers. Offering personalized experiences and incentives such as loyalty programs or special promotions to reward repeat purchases and encourage customer loyalty. Investing in product innovation and quality control to consistently deliver high-quality, desirable products that meet customer needs and exceed their expectations. Establishing a customer-centric culture within the organization, where all employees understand the importance of prioritizing customer satisfaction and are empowered to take proactive steps to address customer concerns. Role Play Situation: Read the Naturally Beautiful Inc. case. Characters: Heather Aunaturale, sales representative for Naturally Beautiful; Rick, customer at Beauty Boutique; Kim, customer at Devine’s department store; Sarah, customer at Cosmetics Unlimited. Scene: Employing a more personal touch, Heather contacts each customer and takes appropriate action to ensure customer satisfaction. Role plays these conversations. Chapter 9 Role Play Midwest Live Bait & Tackle, LLC Background Midwest Live Bait & Tackle, LLC, located in Haliburton, Ontario, is a regional wholesaler of live bait and tackle to bait shops and service stations around Haliburton, Bracebridge, and Huntsville. Known for its high-quality live bait, reasonably priced tackle, and good customer service, the company has been able to maintain a steady market share over the years. Its five salespeople have been primarily responsible for selling and servicing the company’s current accounts. This involves making sure that customers have bait and tackle when needed, assisting them with merchandising and pricing, and ensuring their complete satisfaction. Wanting to retire, the owner recently sold the business. The new owner was very ambitious and had big plans for expanding the company’s market share. He felt that the quickest and most efficient way to move in that direction was to have his current salespeople actively pursue new accounts. Thus, he mandated new customer quotas, compensated salespeople for achieving targeted growth goals, and threatened their jobs if minimal new account requirements were not met. Current Situation Don Laton has been a sales representative for Midwest for over five years. Until the new ownership, he enjoyed his job very much and made a good living doing it. With his fourth child on the way, a poor economy, and a tight job market, Don did not want to jeopardize his position with the company and reluctantly went along with the new changes. However, he was very concerned with how much time prospecting for new business was taking. He felt it may be endangering his current customer relationships. What follows are excerpts from a recent conversation with Jeff Carp, a very significant customer, especially considering he sold bait and tackle out of his service station convenience store: Jeff: Don, I’ve been having some problems recently with the minnows you’ve supplied for me. Some loss is typical, but lately the loss percentage has increased. What’s going on here? Don: I don’t know Jeff. None of my other customers are having problems with their minnows. You’re making sure that you don’t add chlorinated water when replenishing your minnow holding tanks, aren’t you? Jeff: Of course! I recently refurbished my tanks and added a new oxygen system. Maybe that has something to do with the increasing loss. Could you check it out and see what you think? Don: Just let me know how many minnows you think you lost and I’ll see what I can do. Jeff: Okay, but since this has been going on for the last couple of weeks, I was just hoping you might be able to give me your thoughts on my new system. By the way, that new line of fishing poles doesn’t seem to be moving very well. How are they moving for your other customers? Don: I haven’t heard much about those, so I guess they are moving okay. Jeff: Do you have any ideas on how I might improve my merchandising so I can move more of them? Perhaps my price point is too high. What do you think? Don: I’m really busy today, Jeff. I have several stops yet to make and I need to call on a couple of new prospects in the area. Jeff: You’re not planning to supply my competition down the street, are you? Don: I don’t know Jeff. I’ve got to make a living, too, you know. Jeff: Last week you promised to bring by some of those new plastic cricket containers you were telling me about. Did you bring any of those for me to examine? Don: Oh no, those completely slipped my mind. Jeff: Hmm. Well, certainly you brought me the crayfish you promised me last week. I’ve had customers coming in every day asking for them. Also, how about those waterdogs we talked about? I’ve been getting some requests for those. Don: I should have told you sooner, but our usual crayfish supplier is having difficulty getting us as many crayfish as we need. I know you wanted 500 but I think I can give you 100. I thought we’d have the waterdogs by now, at least that is what I was told. We’re still waiting. Jeff: Don, I’m beginning to wonder how much you value my business. If you can’t take care of me any longer, maybe I need to look for someone who can. Don: I’ve been under a lot of pressure lately to get more done in the same amount of time. My new boss is driving me nuts! I definitely want your business. Don needed to hurry off to meet with a new prospect. He didn’t have time to preview some of the new spinner baits his company was now carrying. Role Play Activity Characters: Don, sales rep; Jeff, service station owner Action: Role plays the meeting between Don and Jeff. This time have Don handle the situation (i.e., respond) as a sales rep that takes customer complaints seriously and cares about providing great customer service. Chapter 9 Continuing Case The Disgruntled Customer It was 8:30 A.M. Friday morning when Brenda received the voice mail. It was Susan Swanson, owner of a small architecture firm, who Brenda had acquired as a customer nearly three months ago. “I’m finished with you all,” she barked. “Come get my copier. I want my money back! This blasted machine you sold me keeps jamming. I was billed for extra toner that I never received. You promised me training, and I have yet to see any. And this machine is much slower than I thought it would be. I don’t see how your company stays in business. I knew I should have gone with Xerox!” It’s true, Brenda had told Susan that she would provide training on how to use some of the new advanced features of the copier. She had neglected to get back to Susan and since she had not heard from Susan, she assumed Susan no longer desired the training. As for the paper jams, Brenda found this to be unusual. NCC carried high-quality copiers and she could not imagine what might be wrong. She was sure she had told Susan the specific type of paper to use for her application. However, using the wrong paper could lead to more frequent paper jams. But why hadn’t Susan said anything to her about this sooner? As for the extra toner, Brenda recalls that Susan did order it and later contacted her to let her know that she did not receive it. Brenda then contacted NCC’s shipping department who said they would ship Susan the product. Brenda just assumed that it was shipped. As for the speed of the machine, Brenda was certain its output was per specifications, as equipment at NCC must pass strict quality control measures. Perhaps Susan simply misunderstood the machine’s capabilities. Wow, Brenda thought, now what am I going to do? Questions 1. How should Brenda go about handling this complaint? The best strategy is for Brenda to first consult with her supervisor to determine her options. While doing as Susan asked is probably the simplest move, it is probably not the best. It may be in her best interest in the long run to visit Susan, apologize for all the trouble and then investigate the paper-jam situation. Next, Brenda should be prepared to either refund Susan’s money and let her continue to use the copier, or replace the copier with a more powerful unit (with no up-charge), one that meets Susan’s needs. Next, Brenda needs to schedule the training and deliver the toner free of charge. If Brenda can successfully manage and resolve the complaint, she may have a chance at retaining Susan’s business in the future and diminishing the probability of Susan making negative comments about Brenda and her company to others. 2. What could Brenda have done to avoid this incident? Brenda needed to do several things. First, she needed to make sure she clearly understands Susan’s performance needs, and make sure Susan clearly understands the performance capabilities of the various copiers. Next, Brenda needed to make sure Susan was adequately trained on how to use the copier. Had Brenda initiated and maintained regular communication with Susan, she would have known that Susan still needed training. Brenda should also have monitored the toner shipment, making sure that Susan received her toner. If nothing else, Brenda could have delivered the toner herself, which would have strengthened the relationship. Brenda needs to work on maintaining open communication with her customers and following through on tasks. 3. What steps can Brenda take to do a better job of maintaining open, two-way communication with Susan? Develop a system for ensuring she maintains regular contact with her customers, especially after the sale and during the first few months after installation. Included in that system should be a checklist of activities to monitor, including installation, training, and customer service needs (e.g., toner replacement fulfillment). 4. Assuming that Brenda can retain Susan as a customer, how can she add value to her relationship with Susan’s firm? Brenda needs to keep a close eye on Susan’s satisfaction with the copier and the relationship. She should be prepared for other maintenance issues, having a system in place to ensure they are resolved quickly with little downtime. She should also make an extra effort to get to know Susan’s business and look for other opportunities to help Susan and her organization, whether through cost savings ideas or other sources of value. Solution Manual for SELL Thomas N. Ingram, Raymound W. (Buddy) LaForge, Ramon A. Avila, Charles H. Schwepker, Michael R. Williams, Kirby Shannahan 9780176622107
