Personal Selling: The Art of Successfully Persuading Customers, Lecture notes of Sales Management

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UNIT-

PERSONAL SELLING

 The interaction between a buyer and a seller comprises a

buyer-seller dyad. It is the effectiveness of communication

between the salesperson and the customer during the sales

process decides the success of the sales call. The seller can

interact with the buyer by using various techniques. The most

important of them all, where both get an equal opportunity to

express, is personal selling.

 Personal selling can be defined as “The oral presentation of

a company’s products, or services to one or more prospective

purchasers for the purpose of making a sale”. It is the art of

successfully persuading prospects or customers to buy

products or services from which they can derive suitable

benefit thereby increasing their total satisfaction, i.e., delight

Buyer Seller Dyads

 (^) Example: Personal selling is used extensively in complex and highly technical products like computers, electronic typewriters, digital phones, microwaves, Aquaguard, remote controlled appliances, etc. It is used for selling to industrial consumers who may be having technical queries and want to purchase in bulk.  (^) The increase in competition from foreign and domestic sources has increased the importance of personal selling.  (^) Personal selling is a tool for building up buyer’s preference, conviction and action. The reason is that personal selling when compared with advertising, has three distinct benefits.  (^) Personal Confrontation  (^) Personal selling involves an alive, immediate and interactive relationship building between two or more persons. Each party is able to observe the other’s needs and characteristics at close hand and make immediate adjustment.

Cultivation  (^) Personal selling permits plenty of relationships to spring up, ranging from a matter-of-fact selling relationship to deep personal friendship. Effective sales representatives will normally keep their customers best interest at heart if they want to maintain long term relationship. Response  (^) Personal selling puts the buyer under some obligation for having listened to the sales talk. The buyer has the greater need to attend and respond, even if the response is a polite “thank you”.

Despite all these advantages of personal selling,

it is not without disadvantages because of which

sometimes companies may hesitate to adopt

personal selling as a promotion tool.

1. High cost per contact.

2. Inability to reach some customers effectively.

Disadvantages of

Personal Selling

Changes are taking place rapidly in selling and sales management. In order to bring down the cost of personal selling, companies are tying to tele marketing and other direct selling methods. Buyers are becoming more sophisticated, knowledgeable and demanding. They want to deal with those people who have product knowledge and experience. The intermediaries want help in determining inventory levels’ preparing trade advertising and planning, displays and layouts. Customers want presentations based on facts, products and services that help them to solve their problem.

New Approaches in

Selling

Telemarketing It emerged during the 1980’s as the second major direct marketing technique. Marketers encouraged consumers to use toll free telephone numbers to purchase products in the comfort of their homes. Catalogue marketers, departmental and specialist stores, airlines, hotels, rental car companies and other travel agencies urged the consumers to call toll free numbers. These applications are known as inbound telemarketing. Out-bound tele marketing is the second approach in telemarketing. This involves contacting buyers directly on phone for selling merchandise. Many banks use this approach to sell retirement accounts and financial products. Other major users of out-bound tele marketing are colleges, medical research organisations and other non-profit groups for soliciting contributions.

The situation in which a salesperson approaches a prospective customer to make a sale is termed as a Selling Situation. All selling situations are not the same. There are two types of selling situations:

1. Service Selling
2. Developmental Selling Service Selling Salespersons in a bank often make sales calls to customers who may already be aware of the company’s products. This type of selling is less complex as the customers already know the brand. Example: A salesperson making a call from ICICI Bank is likely to face less difficulty, as it does not require convincing the customer about the company and about the value for money that the product offers. So, service selling aims to obtain orders from existing customers whose habits and patterns of thought are already conducive to the products.

Diversities of Personal Selling

Situations

 (^) Developmental Selling Developmental selling aims at converting prospects into customers. It attempts to create customers out of people who may not, view the company products favourably, be unaware of the company’s products, or are resistant to changing their present source of supply. It is relatively tougher than service selling. It requires a lot of convincing before a customer finally agrees to buy the product. Example: Continuing with the above given scenario: The second team at ABC Bank is assigned the southern region of the city. They decide to contact customers who don’t have any past experiences with the bank and are banking with other competing banks. The team is faced with the task of convincing prospective customers about the value for money of their product. One prospective customer, Shweta Sharma shows some inclination towards the deal. Shyam, the Group Leader, attempts to convince Shweta by conducting a detailed presentation about the bank’s history, its services, its reputation in the market, the benefits of the account, happy experiences of the existing customers etc. and then following up rigorously. Shyam’s efforts finally pay off and he makes a successful sale.

Selling Process

 Successful selling calls for an integrated

approach devised from the experience of the

sales personnel. The approach comprises of

series of steps.

Centre of Influence This technique is based on referrals by a person, who has information about other people or an influence over them. Such a person can help a sales person to identify good prospects. Some of the categories of people to whom such persons belong are housewives, bankers, local politicians, etc. Spotters/Sales Trainees Sometimes a company employs sales trainees specifically for helping the sales persons identify the prospects. The sales trainees are referred to as ‘spotters’. This greatly helps in reducing the time and effort required for qualifying a prospect by the sales person alone.

Cold Canvassing

This technique basically involves calling on a potential customer

without any prior appointment. Here, the sales person just goes

in and introduces himself to the prospect and inquires about the

need of the product or service by the prospect. But this

technique involves a lot of time and effort as a large number of

calls do not materialise.

Directories

Directories are an abundant source of finding potential

customers. Besides the regular telephone directories,

membership directories of trade associations and professional

societies or civic and social organisations are a good source for

prospects.

In this stage the prospect and the salesperson come in contact with each other face to face. Here the salesman has an opportunity to understand and interact with the prospect in a better way. Methods of Approach No one method can be described as the best, since different methods are suitable for different prospects. It is, however, possible to start the approach with one method and end it with another. 1.Cashing in on Brand Name or the Company’s Reputation: This is the commonest of all the methods. (a)The salesman here uses the influence of the brand name of his product or the reputation of his company to attract the attention of his prospect. (b)This method, however, is not suitable for lesser known firms or brands. 2.Customer Benefit Approach: In this approach the salesman arouses his prospect’s interest by making the prospect realize that buying the product will definitely benefit him. (a)Statements such as “Would you like to cut down your credit card bills by 40%” or “Would you like to earn more interest on your savings” or “Would you be interested in a personal loan that is provided to you within 2 hours without much hassles” etc. will definitely arouse the curiosity of the prospect and develop an interest in learning more about the product.

Approaching

3.Innovative Product Opens the Door to the Salesman: Under

this approach, the product examined must be new in the market,

better designed, unique, attractive and appealing to the

customer.

(a) When credit cards were launched in India, it generated a

lot of curiosity.

4.The Premium Approach: Under this approach, salesmen

generally give away small gifts or novelties to the prospect to

draw attention to them and the product.

(a)A Bank salesperson can offer free services like anytime credit

card bill request service over phone, or upto 5% discount on

usage of credit card. This method is generally popular with

housewives