Strategic Sales and Marketing: Building Customer Relationships
ABC Customer Classification
- Group A: Represents 10% of clients, 75% of sales. Your most valuable customers. They should receive special attention and treatment. Any time spent on emails, in-person meetings, or phone calls with them is well worth it.
- Group B: Represents 20% of clients, the next 15% of sales. Customers should not be ignored. With the right attention and encouragement, these items have the potential to become Group A customers.
- Group C: Represents 70% of clients, making up the last 10% of sales. Contains all the minor transactions that generate revenue but do not individually contribute much value to the company. In this category, you should try to automate sales as much as possible to drive down overhead costs.
Personal Selling
Personal selling occurs when a company representative interacts directly with a customer or prospective customer to present information about a product or service. The development of a personal selling philosophy includes three prescriptions:
- Adopt the marketing concept
- Add value to customers
- Become a problem solver/partner
Consultative Selling
Consultative selling emphasizes the role of the salesperson as someone who could listen to a prospect’s needs and offer solutions in a non-manipulative way.
Strategic Selling
Strategic selling is based on a company’s strategic market plan, which considers the coordination of all the major functional areas of the business: production, marketing, finance, and HR.
- Salespeople should consider strategy when planning for sales interactions.
- Ideally, selling will include the consultative role and also strategic planning.
Relationship Strategy
Relationship strategy is a well-thought-out plan for establishing, building, and maintaining quality relationships and an integral dimension of relationship selling. Prescriptions:
- Maintain high ethical standards
- Project a professional image
- Manage the relationship process
Product Strategy
Product strategy is a plan that emphasizes becoming a product expert, selling specific benefits, and configuring value-added solutions. This plan helps salespeople make correct decisions concerning the selection and positioning of products to meet identified customer needs. Prescriptions:
- Become a product expert
- Sell benefits
- Configure value-added solutions
Knowing competitors is key to developing complete product knowledge. Salespeople who have knowledge of their competitor’s strengths and weaknesses are better able to emphasize the benefits they offer and add value.
Customer Strategy
Customer strategy is a plan that results in maximum responsiveness to the customer’s needs. Prescriptions:
- Understand the buying process
- Understand buyer behavior
- Develop a prospect base
Presentation Strategy
Presentation strategy is a well-developed plan for meeting objectives for each sales call. Prescriptions:
- Prepare sales presentation objectives
- Prepare a presentation plan
- Renew commitment to customer service
Successful sales presentations create value by translating product features into benefits that meet a specific need expressed by the customer.
- Features include data, facts, and characteristics of a product or service.
- Benefits include whatever provides a customer with a personal advantage or gain, which can be general or specific.
Intermediaries
Intermediaries are distribution channel firms that help the company find customers or make sales to them.
- Producers make narrow assortments of products in large quantities.
- Consumers want broad assortments of products in small quantities.
- Intermediaries match supply and demand.
Use of Intermediaries
Advantages
- Create greater efficiency in making goods available to target markets.
- Usually offer the firm more than it can achieve on its own through their contacts, experience, specialization, and scale of operation.
- Reduce the number of channel transactions.
- Reduce the amount of work done by producers and consumers.
Disadvantages
- Time
- Price increases
- Losing control over the product and other marketing tools
- Conflicts between the producer and intermediaries
Types of Conflicts
- Horizontal: Generated between members of the same level in the channel. It is usually due to the natural process of competition between companies or even between retailers, for example, because their poor service damages the global brand image.
- Vertical: It is the most frequent, disagreements at different levels of the channel.
- Multichannel: Today, it is common for manufacturers to use two or more channels to reach a market. It is often due to different pricing or margin policies.
Power: The ability of a channel member to force another member to perform some commercial action or to close some agreement. The ability to influence.
Trade Marketing
Trade marketing is the marketing used for the distribution channel. It is a strategic alliance between the manufacturer and the distributor to strengthen the relationship between them and develop tactics together (like advertising, promotions, merchandising, etc.) to increase demand and sales. It is a new point of view from the manufacturer to make the distribution channel members work and collaborate with him. It becomes indispensable as:
- Fierce competence in distribution
- Channel wars
- Brand evolution
- Disloyal customers
Marketing Communication Mix
Marketing communication mix is the specific mix of marketing tools that the company uses to persuasively communicate customer value and build customer relationships. Marketing tools:
- Advertising
- Sales promotion
- Public relations
- Personal selling
- Direct marketing
- Merchandising
Personal Selling
Personal selling uses the sales force to sell products or services to business customers and final customers. Characteristics:
- Interpersonal arm of the marketing mix
- Involves two-way personal communication
- More effective in more complex situations
- Flexibility: capacity of adjusting the marketing offer to the customer and negotiating the terms
- Used to build long-term relationships
- Key in B2B relationships
Enhance Relationships
Suggestions to build strong relationships:
- Become genuinely interested in other people.
- Be a good listener.
- Encourage others to talk about themselves.
- Offer sincere compliments.
- Search for mutual interests.
Seller’s Characteristics
- Are independent, driven, confident, and ambitious
- Value freedom and independence in their jobs
- Work in a stressful environment
- Give them high-level objectives
- Do not tell them how to do their job
- Need to be led and motivated
The Selling Process
- Prospecting
- Pre-approaching: planning the sales
- Approaching: opening and need/problem identification
- Sales presentation/demonstration
- Negotiation and dealing with objections
- Confirming and closing
- Follow-up and servicing the account
New Prospect Sources
1. Random:
- Door-to-door
- Cold calls
- Advertising
- Websites, social media
2. Direct Sources:
- Networking: friends, relatives, neighbors
- Current satisfied customers
- Surveys
- Company records, directories, mailing lists
- Centers of influence
3. Indirect Sources:
- Postal or electronic sales letters
- Trade shows and fairs
- Professional seminars and conferences
- Free gift offers to listen to sales presentations
- Unsolicited inquiries
Planning the Sales
- Prepare the prospect for the initial sales call.
- Pre-notification of the sales call appointment.
- Gather and analyze information about the prospect.
- Conduct a problems and needs assessment for the prospect.
- Identify the product features, advantages, and benefits likely to be of most interest to the prospect.
- Select the best sales presentation or demonstration strategy for the prospect.
- Plan and rehearse your approach to the prospect.
Need or Problem Identification
Discover the exact needs and problems the customer has.
Do:
- Need analysis: Salesperson should adopt a question-and-listening posture in the early stages.
- Be an active listening attitude.
- Use open questions rather than closed questions.
- Make summaries of the points touched to verify and confirm understanding.
How to Convince?
- Remarking the benefits of the product itself: Why is that product the best option?
- Remarking the benefits of you as a supplier: Why are you the best option over competitors?
How to Reduce Risk?
- Reference selling: Take references from satisfied customers.
- Demonstrations: Prove the effectiveness of the product.
- Guarantees: Reduce the perception of risk the buyer has.
- Trial orders: Profitable in the long term.
Negotiating Sales Resistance or Buyers’ Objections
Objections: Concerns raised by the buyer. Expression of confusion, doubt, disagreement, or interest.
Do:
- Prepare convincing answers.
- Listen without interrupting (shows a lack of respect).
- Agree and counter (You are right… but also…).
- Question the objection (letting the buyer explain more himself).
- Anticipate the objection (included in the presentation).
- Turn the objection into a trial close (to demonstrate that the seller is right).