ssm lecture-04 (selling skills & strategies)

07/06/10 1

By :

Prof. Amit Kumar

07/06/10 2

“A student pursuing management education from IILM-

Graduate School of Management, for example may find

himself or herself placed in a firm as a Sales Manager.

Our goal is to prepare the student for the exciting

challenges related to leading sales organizations in

today’s hyper-competitive global economy”.

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Importance of this course

Selling & Sales Management

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Selling & Sales Management

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Contents

• Introduction: Who is a successful seller?

• Selling & Buying Styles

• Selling Skills– Communication Skills

– Listening Skills

– Negotiation Skills

– Conflict Management Skills

– Problem-Solving Skills

• Selling Situations

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Selling & Sales Management Selling Skills & Strategies

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Who is the Successful Seller?

Who is a successful seller? One of the prominent myths in selling is the idea that successful

salespersons are born, and it is difficult to acquire skills that can turn an average salesperson into a

successful one.

Selling skills are a set of characteristics that are necessary for a salesperson to possess, failing which he may not be successful in selling. It is not correct to assume that successful salespersons are born. The essential skills for successful selling are:

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Selling Skills

Selling Skills

Listening Skills

Conflict management and resolution skills

Negotiation and

bargaining skills

Problem solving skills

Effective communication

skills

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Selling and Buying Styles9

8

7

6

5

4

3

2

1 2 3 4 5 6 7 8 9

Con

cern

for

th

e cu

stom

ers

(1,9) People Oriented

I am customer’s friend,

I want to understand him and respond to his feelings and interests so that he will like me. It is the personal bond that leads him to purchase from me.

(5,5) Sales technique Oriented

I have tried an effective routine for getting a customer to buy. It motivates through a blended personality and product emphasis

(1,1) Take it or Leave it

I place the product before the customer and it sells itself as and when it comes.

(9,1) Push the product Oriented

I take challenge of the customer and hard sell him, polling on all the pressure it takes to make him buy

(9,9) Problem Solving Oriented

I consult with the customer so as to inform myself of all the needs in his situation that my products can satisfy. We work towards a sound purchase decision on his part, which yield him the benefits he expects from it.

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Concern for Sale

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Selling & Buying Styles

In figure, the salespeople in position (1,1) believe in the physical display of the product and assume that

customers will buy by it themselves if the logistics are managed.

This is possible in the market where customers do not have many choices or in product categories in which customers

do not place any importance to issues like product demonstration and briefing by the salespeople.

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Position (1,1)

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Fast moving consumer goods are in this category where the advertising and other promotion programmes bring the customer to the retail counter (by a pull method) and the store presence and visibility make the brand sell itself.

Here the sales force has the least role to play as they do the business of physical transfer of goods to the customer contact point.

Similarly, in a market where the demand exceeds supply so much that the customer is bound to take what is being offered, this kind of selling will be very effective as it involves very low cost due to non-use of advance selling techniques and few or no calls by the salespeople.

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Position (1,1)

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• Salespeople in the (9,1) position are more product-oriented and they always try to push the product for sale.

• They try to sell the product without caring for the customer demand patterns. They feel that it is possible to sell any product.

• They do not consider the customer’s buying intension and do the hard sell by putting all the pressure to realize a sale.

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Position (9,1)

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• The salespeople in the (1,9) position treats himself as a friend of the customer.

• This is predominantly the relationship domain and the salespeople are involved in the relational selling, where they try to understand the customer and respond to his feelings and interests so that the salesperson is able to establish a personal rapport with the customer and realize a sale.

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Position (1,9)

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• Salespeople (in the 9,9 position) are problem solvers. They consult with the customer so that they understand his situation and all his needs, and then suggest a product that can solve his problem.

• They work with the customer towards a sound purchase decision on his part that will help him get the desire results.

• This is basically consultative selling and is normally seen in the software and consultation selling industry where the salespeople take note of the customer’s briefs and come with a solution that best fits the customer’s problems.

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Position (9,9)

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• A salesperson in position (5,5) is a professional who keeps balance between concern for customer and concern for sale.

• such sales people use various sales techniques to do prospecting and sales presentation. Their sales pitch is based on blend of personality and product orientation.

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Position (5,5)

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Selling Situations

Maintenance selling

Developmental selling

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Selling SituationsMaintenance selling

Typically maintenance selling involves the art of servicing the existing accounts, securing promotional cooperation, counting inventory and taking replenishment orders and deliver the products.

In advertising world, these kind of salespeople are called client servicing executives who provide services to clients and also take the orders as and when required.

There is no question of prospecting for this kind as it is done with the existing customers.

In IT sector, these salespeople are posted at the client site and are responsible for solving the client’s problems.

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Selling SituationsDevelopmental selling

Salespeople engaged in developmental selling are called BDE as they try to contact the potential customers and build business for the firm.

They are the real salespeople who try to do prospecting from the leads either available in the organization or collected by them, and then take the prospect through the whole process of selling to realize a sale.

Getting orders is a characteristic of developmental selling. Here the salesperson must seek for the potential customers and obtain their order.

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Selling Skills

Selling Skills

Listening Skills

Conflict management and resolution skills

Negotiation and

bargaining skills

Problem solving skills

Effective communication

skills

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Communication Skills

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• A salesperson needs to understand the communication process before he develops his own strategies for successful selling.

• Sales communication can be both personal and non-personal.

• Personal communication is sure to take customers from one level to the next level of the decision process.

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Chandrakant Sen is the sales manager at USHA Corporation and he was giving a presentation that a new

product would deliver higher profit to the customer, SAIL. When he was quizzed to display how the

organization will be befitted, he touched a couple of keys in his laptop and ran a graphic program to show

diagrams to the customer during the presentation that illustrated his idea and proposition.

This shows effective communication will help people in realizing a sale and handling objections successfully if the salespeople have done their homework properly.

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Communication Process

Noise

Channel

FeedbackIntended Message

Sent Message

Encoding

Perceived Message

Received Message

Decoding

Sender Receiver

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• Communication can take the form of verbal and non-verbal.– Verbal communication consists of words arranged in a

meaningful patterns.

– Most basic form of communication is non-verbal in nature. Facial expressions, gestures, spatial relationships and attitude towards time and people are included in non-verbal communication.

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Communication SkillsManaging Body Language:Salesperson can take care of their verbal and non-verbal communication while making sales presentations. The non-verbal cues taken together are called body language, variouselements of which have been as:

Personal Appearance

Posture

Gestures

Facial Expressions

Eye Contact

Space Distancing

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Listening Skills

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• The sales manager has to be very good listener and use his listening skills to lead towards sales.

• Effective listening can be explained by the example of a doctor who is attending a patient.

• Good listening also enhances the impact of what the salesperson speaks to the customer, and increases the ability to negotiate with customers.

Research suggests that people are only 25% efficient in their ability to listen. An average person remembers only about half of what is being told to him after 10 minutes, and forgets half of that within

48 hours.

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Listening Skills

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There are three types of listening:

1. Content Listening

2. Critical Listening

3. Empathetic Listening

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Process of Listening

Attendance

Interpretation

Evaluations

Remembrance

Response Action

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Conflict Management Skills

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Conflict in sales org. is more evident than in any other org. This is due to the fact that there is always conflict of interest among people at different levels as the goals are different at each level of the org.

A sales manager wants his salespeople to cover his territory as thoroughly as they can whereas

salesperson are interested in realizing the desired sales through a few loyal customers. The vice

president is interested in getting better results from the same cost to show the board that resources are being

used efficiently.

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Conflict Defined

Is a process that begins when one party perceives that another party has negatively affected, or is about to negatively affect, something that the first party cares about.

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Conflict can be classified as:• Functional: This conflict supports the goals of the

group and improves its performance.

• Dysfunctional: It hinders group performance.

• Task: These are disputes over the content and goals of the work.

• Relationship: It is tussle based on interpersonal relationships.

• Process: It is fight over how works get done.

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Stage I

Potential opposition or

Incompatibility

Stage II

Cognition &

Personalization

Stage III

Intentions

Stage IV

Behaviour

Stage V

Outcomes

Antecedent Conditions

Communication

Personal Variables

Structure

Perceived Conflict

Felt Conflict

Conflict handling Intentions

Competing

Collaboration

Compromising

Avoiding

Accommodating

Overt Conflict

Party’s behaviour

Others reaction

Increased group

performance

Decreased group

performance

Conflict Management Process

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Stage-I: Potential opposition or Incompatibility

The first step in the conflict process is the presenceof conditions that create opportunities for conflict toarise. They need not directly lead to the conflict, but one of these conditions (Antecedent Conditions) isnecessary if conflict is to surface.

1. Communication2. Structure3. Personal Variables

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Communication: can be a source of conflict.

Deepa had worked in SCM at Bristol Hotel for 3 years. She enjoyed her work in large part because

her boss, Ranjan, was a great guy to work for. Then Ranjan got promoted 6 months ago, and Vijay took his place. Deepa says her job is a lot

more frustrating now.

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Stage-I: Potential opposition or IncompatibilityCommunication: can be a source of conflict.

“Ranjan and I were on the same wavelength. It

is not that with Vijay. He tells me something and I do it. Then he tells me I did it wrong. I

think he means one thing but says something else. I don't think a day goes by when he is not yelling at me for something. You know, there

are some people you just find it easy to communicate with. Well, Vijay is not one of

those.”

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Stage-I: Potential opposition or IncompatibilityStructure: can be a source of conflict.

Meera and Rubina both work at InStyle- a large

discount furniture retailer. Meera is a salesperson on the floor, and Rubina is the company credit

manager. The two women have known each other for years and have much in common: they live

within two blocks of each other, their oldest daughters attend the same middle school and are

the best friends. But, these two women are consistently fighting battles with each other.

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Stage-I: Potential opposition or IncompatibilityStructure: can be a source of conflict.

Meera's job is to sell furniture, and she does a heck

of a job. But most of her sales are made in credit. Because Rubina's job is to make sure the

company minimizes credit losses, she regularly has to turn down the credit application of a

customer with whom Meera has just close a sale. It's nothing personal between Meera and Rubina; the requirements of their jobs just bring them into

conflict.

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Personal Variables: (Personality, Emotions and Values)

Have you ever met someone to whom you took an immediate disliking? You disagreed with most of the opinions they expressed. Even insignificant

characteristics- sound of their voice, they personality- annoyed you. We have all met people

like that. When you have to work with such individuals, there is often the potential for conflict.

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Stage I

Potential opposition or

Incompatibility

Stage II

Cognition &

Personalization

Stage III

Intentions

Stage IV

Behaviour

Stage V

Outcomes

Antecedent Conditions

Communication

Personal Variables

Structure

Perceived Conflict

Felt Conflict

Conflict handling Intentions

Competing

Collaboration

Compromising

Avoiding

Accommodating

Overt Conflict

Party’s behaviour

Others reaction

Increased group

performance

Decreased group

performance


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Stage-2: Cognition and Personalization

Cognition is the mental process of knowing, including aspects

such as awareness, perception, reasoning, and judgment.

• Because a conflict is Perceived conflict does not mean that it is personalized. In other words, 'A may be aware that B and A are in serious disagreement, but it may not make A tense or anxious, and it may have no effect whatsoever on A's affection towards B’.

• It is at the Felt conflict level, when individuals become emotionally involved, that parties experience anxiety, tension, frustration.

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Cooperativeness:

• Attempting to satisfy the other party’s concerns.

Assertiveness:

• Attempting to satisfy one’s own concerns.

Cooperativeness:

• Attempting to satisfy the other party’s concerns.

Assertiveness:

• Attempting to satisfy one’s own concerns.

Satge-3: Intentions

Decisions to act in a given way.


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Dimensions of Conflict-Handling Intentions

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Stage-3: Conflict Handling Intension

1. Competing: Each party pursues its own interests, regardless of the impact on the other party.

2. Collaborating: Both parties in a conflict try to satisfy fully the concerns of both parties.

3. Avoiding: One party withdraws from or suppresses the conflict.

4. Accommodating: One party agrees to place the opponent’s interests above its own.

5. Compromising: Both parties agree to give up something.

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The Conflict Resolution Process:

- lumping- avoidance- coercion- mediation- conciliation- adjudication- negotiation

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Negotiation Skills

• Negotiation occurs when someone else has what you want, and you are prepared to bargain for it and the vice versa.

• Successful negotiation is an attempt by two parties to achieve mutually acceptable solutions. (win-win)

• Negotiation is very important in selling because majority of selling is done without a list price.

• In B2B selling and services selling, the success of selling largely depends on how a good negotiator the salesperson is.

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Negotiation Skills

Let us take an example of a student Mr. Kumar who did not take

Up any job after graduating from a business school and wanted

to develop a new computer game that he believed would be

highly successful. However, it would take a long time to

program it. He needed to earn for his living also.

He met one of his classmates Shankar, who had joined a large

MNC after the business school. Shankar liked his idea and

agreed to put it through to his management. But Shankar’s

organization could offer only Rs.1 Lakh.

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Negotiation Skills

Kumar said it will take him ten months to develop the product

and while Rs.1 Lakh will enable him to survive during this

period, it was not enough as a reward. He suggested that

Rs.1 Lakh should be treated as an advance against future

profits and that he and the company share the profit in the

ratio of 25:75. Eventually the deal was finalized at 20:80.

The computer game was launched in a big children fair and was a huge success. It brought great rewards to both company and Mr. Kumar. This is an example of

win-win situation.

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Negotiation Skills: Zone of Agreement

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Seller’sReservation Price(Seller wants S

or more)

Seller’s Surplus Seller wants to Move X up

Buyer’s Surplus

Buyer’sReservation Price(Buyer wants B

or less)

Buyer wants to Move X down

Zone of AgreementFinal Contact

S

B

x

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Problem-Solving Skills

• Besides the negotiation skills, one also needs problem-solving skills for effective selling.

• The consultative selling approach suggests that a salesperson should not be a mere order taker; he should rather act as a problem-solver and a consultant to the customer.

• These roles are more significant for high-tech selling and B2B selling.

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Characteristics of Ineffective/Effective Problem-Solver

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Characteristics Ineffective problem-solver Effective problem-solver

Attitude Thinks nothing can be done;

Gives up easily

Believes the problem can be solved

Actions

Lies back and expects that a solution will come naturally; Jumps to

conclusion very fast

Re-evaluates the problem, Re-describe the problem, draw sketches and write

equations

Accuracy Does not check Checks and Recheck

Solution Procedures

Does not break the problem, lets it be as it is, Not know where to start, fails

to identify key concepts, relies on guess, no proper plan, quits and

withdraws easily

Breaking into smaller problems, starts at a point

where he understands better, uses fundamental concepts,

use qualitative & quantitative equations, keeps a track of

changes and progress

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Problem Solving Skills

Stephen Covey in his famous book ‘The Seven Habits of Highly Effective People’ lists seven habits that make people more

effective problem-solvers.

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Problem Solving Skills

Habit I: be proactive

Habit 2: begin with an end in mind

Habit 3: put first things first

Habit 4: think win–win

Habit 5: seek first to understand, then to be understood

Habit 6: synergize

Habit 7: renewal

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Define the problem

Generate alternative solutions

Decide the solution

Implement the solution

Evaluate the solution

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Problem Solving Process

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Problem Definition Techniques

Find out origin of the problem

Explore the problem

Present desired state

analysis

Evaluate problem

statement

Statement and

Restatement

Dunker’s diagram

Problem Definition Techniques

1

2

35

4

6

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Achieve the desired state

Possible path to the desired state

Path 1 Path 2 Path 3

Solutions to implement & paths to desired solutions

Solution 1Solution 2 Solution 3

General Solution

Functional Solution

Specific Solution

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Dunker’s Diagram

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Decision on the best solution

Approval

Planning

Carry through

Follow up

Evaluation

IMPLEMENTATION

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Solution Implementation Process

ssm lecture-04 (selling skills & strategies)

Documents

successful selling

skills communication

essential skills

sales management

skills strategies position

skills strategies concern

resolution skills negotiation

bargaining skills problem