The Personal

Selling Process

The sales process itself plays

an increasing role in
creating customer value.
Neil Rackham
 Principles of Personal Selling

• Personal Selling is an ancient art.

• Effective salespersons have more than instinct;
they are trained in methods of analysis and
customer management.
• Dale Carneige’s book “How to win friends and
influence people”
 Sales Training Approaches

Order Taker Order Getter

• Operate on the assumption • Sales Oriented Approach
that customers know their • Customer oriented Approach
own needs,resent attempts to
influence them, and prefer
courteous and self effacing
salespersons.
 Sales Oriented Approach Customer Oriented Approach
• Trains the person in the • Trains salespeople in customer
stereotyped high pressure problem solving.
techniques used in selling • The salesperson learns how to
encyclopedias or automobiles. listen and question in order to
• This form of selling assumes identify customer needs and
that customers are not likely come up with sound product
to buy except under solutions.
pressure,that they are • Presentation skills are
influenced by a slick secondary to customer need
presentation, and that they analysis skills.
will not be sorry after signing
the order.
THE EIGHT STEPS OF THE SALES PROCESS

8. Follow-up
7. Gaining Commitment
6. Meeting objections
5. Presentation
4. Need Assessment
3. Approach
2. Preapproach
1. Prospecting
 Challenges in Personal Selling
• Inability to hard-sell
• Manager resistance
• Priority dilution
• Irregular reporting
• Poor data quality
• Employee turnover
• Loss of interest over a period
 1) Prospecting
The method or system by which sales-people learn the names of
people who need the product and can afford it.

• Leads can be identified through…

– Referrals from customers
– Referrals from internal company sources
• Sales manager; Marketing dept.; Telemarketing dept.
– Referrals from external agencies
• Trade Associations,Industry Associations,Internet,Online Information services
– Published directories
• Yellow Pages
– Networking by the Salesperson
– Cold canvassing
 Prospecting Activities for Residential Real
Estate
• Property Exhibitions
• Customer References
• Corporate Tie Ups (Discount
of Rs 25-50/sft)
Prospecting Activities for Commercial Vehicles
• Financier
• Demo Caravans
• Advertisements in local
newspapers
• Visit to Competition
customers
• Tenders/Contracts
• Brokers
• Vehicle Clinic
• Promotional Offers/Schemes
 Prospecting (Mutual Funds)
Existing Sources Activities
• Bank Customers,mostly salary • Local Advertisements(Leaflets)
account holders • Kiosks in Apartment Complex
• Customer Referrals • Corporate PPT
• Directories of Industrial zones • Financial Trade Fairs
• NASSCOM,CII,FICCI,ASSOCHM • Retailers of High end goods
(Cold Canvassing)
• Spreading Financial literacy in
Kitty parties
• Meeting Celebrities in
Bangalore
– Rahul Dravid
– Puneet Rajkumar
Lead Management Tools
Activity Prospect Stack Up Tracker
 Prospect Customer Form
• Name of the Customer along with address & contact details.
• End use application of the product for each segment.
• Product/Brand currently used
• Type of customer
• Standardised or Customised
• Mode of Enquiry
• Model Description & Quantity
• Enquiry Status
• Follow up Details
• Reason for loss of sale
 Qualifying Leads

• A qualified prospect…
– Has a need for the products being sold.
– Can afford to buy the products.
– Is receptive to being called on by the
salesperson.
Prospect Management Puzzle

Prospect?
Prospect? ColdProspect?
Cold Prospect?

WarmProspect?
Warm Prospect? HotProspect?
Hot Prospect?
 The Answer!

To improve availability and predictability of prospect data and

complete control over prospect management cycle
 Defining prospect categories

ColdProspect
Cold Prospect

WarmProspect
Warm Prospect

HotProspect
Hot Prospect

0 Month 1 2 3
s
Point of
Contact Intension to purchase
 Our Prospects
ColdProspect:
Prospect: Retailed:
Retailed:
Cold
ExpectedPurchase
Purchase<<33months
months Goodsdelivered
••Goods deliveredafter
after
••Expected
Suspectcontacted
contactedfrom
fromCDB
CDB invoicing
invoicing
••Suspect

FullPayment:
Full Payment:
DO/ /Payment
••DO PaymentReceived
Received
Commercialtransaction
••Commercial transaction
complete
complete
WarmProspect:
Warm Prospect: Canbe
••Can beskipped
skippedififcredit
credit
ExpectedPurchase
••Expected Purchase<2
<2 offered
offered
months
months
Takenquotation
••Taken quotation HotProspect:
Prospect:
Hot
ExpectedPurchase-
••Expected Purchase-within
withinthe
themonth
month
PO/ /Token
••PO Tokenmoney
moneytaken
taken
 Checklist to Qualify Hot Prospects

• Check Compliance to the following activities when

Qualifying Hot Prospects
– 1. SE aware of the specific requirements of prospect.
– 2. Product related discussion (demo) has happened.
– 3. Quotation given to prospect.
– 4. Price agreement reached.
– 5. Applied for loan from a financier.
– 6. Indicated a specific date by which prospect needs to have the
vehicle.
– 7. Prospect gives positive & assuring reply to SE on every call.
• Out of 7 points mentioned above, minimum of 5 points
should be applicable for a prospect to be categorized as
“Hot”.
Hot Prospect Tracking Sheet
 Prospect Funnel

Understanding prospect funnel is

essential for
effective Prospect Management

How is a prospect funnel different

from a prospect pipeline or are
they the same?
 Prospect Funnel vs. Pipeline

Cold

Warm
Prospects
Hot
FP
R
FP Full Payment
R Retailed
 Conversion Ratios

Cold 100

Hot to Retailed = R Warm 54

Hot + FP + R
Hot 7
FP 2
73%
R 19

Measure of :
• Deal closing skills
• Financier relationships
 Conversion Ratios

Cold 100

Warm 54
Warm to Hot = R + FP + Hot 32%
R + FP + Hot + Warm Hot 7
FP 2
R 19

Measure of :
• Quality of coverage in
previous and
this month
• Selling skills and product /
market
knowledge
 Conversion Ratios

Cold 100

Warm
Warm to Retailed = R 54
R + FP + Hot + Warm Hot 7
23%
FP 2
R 19

Measure of :
• Quality of coverage in
previous and
this month
• Selling skills and product /
market
knowledge
 Conversion Ratios

Cold 100

40% Warm 54
Cold to Warm = R + FP + Hot + Warm Hot 7
R + FP +Hot + Warm + Cold FP 2
R 19

Measure of :
• Quality of coverage in previous and
this month
• Quality of prospect, segment
selection
• Availability of a comprehensive CDB
• Competition knowledge
 Conversion Ratios

Cold 100

Warm 54
10.5%
Cold to Retailed = R Hot 7
R + H + FP+ W + C FP 2
R 19

Measure of :
• Quality of coverage in previous and
this month
• Quality of prospect, segment
selection
• Availability of a comprehensive CDB
• Competition knowledge
 Month Closing Funnel

Conversion Ratios
Cold
Cold to warm=(W+H+FP+R)/(C+W+H+FP+R))×100 =
Warm
Warm to Hot = ((H+F+P+R)/(W+H+FP+R))× 100 =
Hot
FP Warm to Retailed = (R/(W+H+FP+R)) × 100 =

R
Hot to Retailed = (R/(H+FP+R)) × 100 =
• Cold = 600
• Warm = 250
• Hot = 50

• Out of 600 cold prospects, suppose 500 become suspects or

they do not meet the criteria for cold prospect classification,
then these 500 people will go to back end master database.
• Out of 250 Warm prospects, 150 shift to cold status.
• Out of 50 Hot prospects, 25 shift to warm status.

Then the final classification would be:

• Cold = 600-500+150 = 250
• Warm = 250-150+25 = 125
• Hot = 50-25 = 25
 Estimating Prospect Funnel

Sales target: 50

Conversion factors are as: Cold

Cold to Warm 40%
Warm
Warm to Retailed 23%
Hot to Retailed 73% Hot
FP
Calculate: R
Target Cold, Warm, Hot prospects
for the month (Cp, Wp, Hp)
• Hot to Retailed = Retail/(Hot + FP+ Retail)
(0.27/0.73) x 50 = 18
• Warm to Retailed = Retail/(Warm + Hot + FP+ Retail)
0.23 x 18 + 0.23 x W + 0.23 x 50 = 50
= 149
• Cold to Warm = (Warm+Hot+FP+Retail)/(Cold+Warm+Hot+FP+Retail)
(50+149+18)/ (50+149+18+C) = 0.4
= 326
• Balance Hot for the Month = 18 - 8 = 10
• Balance Warm for the Month = 149 - 75 = 74
• Balance Cold for the Month = 326 - 150 = 176

• This gives a visibility in the system in terms of the number of prospects

you need to generate to achieve the planned results.
• Now you have to make an action plan to generate the required number
of prospects.
• At the end of the month, you need to calculate
these ratios to see your performance vis-à-vis
industry benchmarks.
• If the ratios are lower than the industry
benchmarks, then take the ratios achieved in
previous month as the benchmark. i.e.
If IB>CR,then use CR of the previous month
• If they are higher than the industry benchmarks
then use the industry benchmarks for the next
month.
If IB<CR,then use IB
 TARGET FUNNEL MONTH OPENING SHORTFALL FUNNEL
SALES TARGET =50 FUNNEL

Conversion Prospect Prospect Prospect

Ratios Target Target Target

Cold = 326
Cold Cold =176
= 150
C TO W =
Warm = 149 Warm = 75 Warm =74

W TO H =
Hot = 18 Hot =8 Hot =10

W TO R = FP =0 FP =0 FP =

H TO R = R = 50 R =0
R =

(A) (B) (C)= (A) – (B)

Use conversion ratios to calculate Use fig. from previous month Calculate shortfall by subtracting
the prospect targets required to closing funnel and update the balance prospect requirement
achieve the given vehicle target status of the prospects from target no of prospects
 Sales Executive
• Tap new prospects and build pipeline/Funnel.
• Keep feeding the sales funnel at the top
• Classify prospects
• Fill Prospect Forms
• Update prospect status
• Implement Activity plan finalized with DSM.
• Daily reporting to SM/ MIS Operator.
Daily Prospect Call Tracker Format
 MIS Operator

• Receive daily prospect report from all DSE

• Compile daily reports from DSE in the given
format/ tool
• Submit the report to DSM
• Send a daily status of reports received from SE to
SM
Daily Prospect Monitoring Sheet
 Area Sales Manager
• Month Planning
• Prospect target calculation
• Activity Planning
• Review Meetings
• Prospect position analysis
• Review & corrective action for each SE
• Inventory Planning
• Analyze daily compiled report from MIS operator and
highlight problem areas
• Daily reporting to RSM
Lead Conversion Ratio: Inquiry to Decision
12 Months After Inquiring

Plan to buy
Purchased
25%
Purchased
45% No longer in
No longer in market
market 30% Plan to buy

*SOURCE: Bob Donath, James K. Obermayer,

Carolyn K. Dixon, and Richard A. Crocker, “When
Your Prospect Calls,” Marketing Management,
Vol. 3, No. 2, 1994.
The Value of Inquiry Follow-Up

Share of
buyer’s
business if not
followed up
40%

Share of buyer’s
business if followed up
83%

*SOURCE: Bob Donath, James K. Obermayer,

Carolyn K. Dixon, and Richard A. Crocker, “When
Your Prospect Calls,” Marketing Management,
Vol. 3, No. 2, 1994.
 2) Preapproach: Planning the Sale
• Includes all the information-gathering activities
salespeople perform to learn relevant facts about the
prospects, their needs, and their overall situation.

• Adaptive selling:
– When a salesperson alters the initial objectives or plans
of the sales process because of new information gained
from the customer during the actual call.
 Customer Research
• Size
• Present purchasing practices
• The location of its HQ,Branch offices & location of
manufacturing plants
• The names of people who make the buying decisions as
well as those who influence the purchase.
• Buyer’s background – Education,social affiliations &
personalities.
• Become familiar with the problems of prospective buyers.
• Read the company files from customer database-sales
records,correspondence,past sales calls.
 Planning the Sales Presentation

• It takes 4-5 calls to close a sale.

• The salesperson must obtain from the buyer some
type of commitment for action that moves the
sales process forward.e.g.
– Vendor Selection Criteria
– Meeting with other decision makers
• Salespeople recognize differences across selling
situations & adapt their presentations accordingly.
3) The Approach: The first minute or so of the call.(Icebreak)

• A good approach makes a favorable impression and

establishes some degree of rapport between the salesperson
and the buyer.
• Salespeople can draw attention of the buyer by
– Handing over a sample
– Highlighting some benefit in which the buyer will likely be interested

• Expectations in India:
– Greeting in the local language
– Professional attire
– Body Gestures & eye contact.
 4) Need Assessment

• The stage in which the salesperson

must discover, clarify, and understand
the buyer’s needs.
• The best way to uncover and
understand needs is by asking
questions.
 NEED ASSESSMENT
• Situational questions
How often do you change the cutting oil in your drill presses?
In addition to the hospital administrator, who else has an influence on the decision?
• Problem discovery questions
Have you experienced any delays in getting repair parts?
In which part of the production process is quality control the most important?
• Problem Impact questions
How do these delays in getting parts affect your production costs?
What impact do the quality consistency problems have on your production costs?
• Solution value question
If your inventories could be reduced by 20%, how much would that save you?
If your rejection rate on final inspection was reduced to under one percent, how much would
that save you?
• Confirmatory questions
So, you would be interested in an inventory control system that reduced your inventories by 20%?
If I can provide evidence to you that our products would lower your rejection rate to under one
percent, would you be interested?
Situations to Sell
Hand Sanitizer
 5) The Presentation
• A discussion of those product and/or service features, advantages,
and benefits that the customer has indicated are important.
• Built around a forceful product demonstration

• Prepared presentation vs. Adaptive selling

• Tips for effective presentations

– Keep it simple
– Talk the prospects language
– Stress the application of the product/service to the
prospects situation
– Seek credibility at every turn.
 Presentation of Product, Features, Benefits, Advantages
Product Features Benefits Advantages
Camera Telephoto lens Take pictures Able to capture
from longer images of animals distances.
or people from a distance.
Bicycle Attached water Can hold a water Don’t get dehydrated.
bottle. bottle holder Don’t have to stop
for water. Feel more refreshed.
Drill Press Multiple drill Can change bits Saves time.
bits attached without shutting Saves money.
down the machine.
Motor Oil Rust inhibitor Oil and engine Saves money.
have longer life.
Use the FAB Model to sell following Products

PEN ELECTRIC SWITCH POTATO OB BOOK

WATCH CELLO TAPE SHOE TISSUE PAPER
LIGHTER SCISSOR VISION SPECTACLES PERFUME
PEN DRIVE STAPLER SOAP TILE
LAPTOP PUNCH DUSTBIN WALLET
MOBILE PHONE CHOCLATE MINERAL WATER BELT
RING CHEWING GUM BRACELET PAPER WEIGHT
NECKLACE TIE MOUSE
CHAIR SHIRT EGGS
FAN KPL STEEL GLASS
 6) Meeting Objections
• Objections should be welcomed because they indicate that the
prospect has some interest in the proposition.

• In responding to an objection…
– Listen to the buyer
– Clarify the objection
– Respect the buyer’s concern
– Respond to the objection

• Common types of objections

– Price or value objections
– Product/service objections
– Procastinating objections
– Hidden objections
 7) Gaining Commitment

• Asking the buyer to commit to some action that moves the

sale forward.

• Common Sales Closes

– The Assumptive Close
• “Now what size do you want?”
– Special Offer Close
• “If you buy this product today, we’ll double the length of the warranty.”
– Summary Close
• “You have agreed that our product is the best on the market. Correct?
Then I suggest that you place your first order today so we can have it to
you by the end of the week.”
 8) Follow-Up

• Reps must learn that the sale is not over when

they get the order.
• It is much more expensive to acquire new
customers than it is to retain existing
customers.
• Following up to ensure that the customer is
fully satisfied builds trust and is consistent
with the concepts of Relationship Marketing.
 Benefits to Company
• Higher internal efficiency
• Lower and active inventory
• Higher productivity of working capital
• Higher productivity of manpower
• Prediction accuracy of monthly retail
• Lesser product shortages
• Reduced seasonality effect on retail
• Higher retails and market shares
• Financiers performance measures