Sales Flashcards
What is Perceived Value?
Value is the customer’s perception of the balance between benefits received from a product or service and the sacrifices made to experience those benefits.
How do customers reduce perceived risk?
- Delay purchase
- Seek word-of-mouth endorsement
- Negotiate service contracts
- Seek additional information from advertising copy
- Buy known brands
- Deal with reputable suppliers
- Seek performance guarantees
- Take out insurance
- Demand pre-purchase trial
What is a Value proposition?
A value proposition is the explicit or implicit promise made by a company to its customers that it will deliver a particular bundle of value-creating benefits.
Which value delivery strategies do you know?
- Operational excellence
- Product leadership
- Customer intimacy
What is mass customization?
Mass customisation is the use of flexible processes and organizational structures to create varied and even individually tailored value propositions, with neither a cost nor a lead-time penalty.
Which key customer acquisition questions do you know?
- Which prospects (potential new customers) will be targeted?
- How will these prospects be approached?
- What offer will be made?
Which Sources of B2B leads do you know?
- Satisfied customers (Refferals)
- Networking (personal contacts)
- Promotional activities (Exhibitions, etc)
- Web-sites
- Publicity
- Lists and directories
- Tele-marketing
What are key questions in B2B prospecting?
- Does the lead have a need for my company’s products?
- Does the lead have the ability to pay?
- Is the lead authorised to buy?
What KPI’s do you know for customer acquisition programs?
- Number of customers acquired
- Cost per acquired customer
- Value of the acquired customer
Should a sales force be specialized?
Sales specialization improves performance.
However:
-
Specialization is expensive
- Must produce results that are greater than investment
-
Sales specialization is more difficult to manage
- Requires greater oversight to align with firm’s strategy
-
Changing sales assignments are challenging:
- Must modify job content and account assignments
- This requires substantial planning and investment
When do manufactorers mainly use indepent sales agent in addition tho their own salesforce?
Common for manufacturers is to use sales agents when entering new territories with low or unknown sales volumes.
- Selling costs (commissions) incurred only when product or service is sold
What are the advantages of using an independent sales agent?
Advantages of using an independent sales agent:
- An “in-place” or existing sales force
- Established buyer relationships
- Little (or no) fixed costs
- Experienced sales personnel
- Lower costs per sales call
- Long-term stability in the territory
What are the disadvantages of using an independent sales agent?
Disadvantages of using an independent sales agent:
- Seller may not receive equal time for their products
- Agents blamed for shifting sales call focus to another product line when buyer’s need is not easily identified
- Agents criticized for not opening new accounts, not following up on leads, representing too many mfgs, and communicating poorly with the firms they represent
What may be sources of conflict Sources of conflict between firm and selling agent?
- Goal Differgence
- Domain Dissension (who owns a particulair domain, like territory served)
- Reality Perceptions (one party feel sligted when the other party believes it acted in good faith)
- Abuse of Power
When should a company has it’s own salesforce?
- When it’s important to control sales effort, product or related technology is new, buyers need high level of service
- Company exerts greater control over sales force efforts
- Greater control over who is hired
When should a company hire indepent sales agents?
- When potential sales revenue is low in a territory
- When revenue will take years to become substantial
- When qualified sales agents already operate in the area
- When it’s not feasible for company sales force to cover entire market (e.g., National Semiconductor, Advanced Micro Systems)
What can be reasons for not reaching sales goals?
Internal Factors
- Flawed sales projections based on limited market research
- Changes in marketing mix variablesresulting in inferior products or services
- Increase in cost of supplies passed on to buyers via higher product prices
- Promotional campaigns don’t produce projected results
- Delays or other problems with distributionof products
External Factors
- New competitors and competing products entering marketplace
- Environmental factors affect customer demand and cause customers to postpone or cancel their purchases
- Change in laws and regulations preventing or restricting use of products and services or making them more expensive
- Changes in the way firms do business,for example, as a result of new technology
What is CRM?
In general, Customer Relationship Management is the development and nurturing of long-term customer relationships to produce:
- greater customer loyalty
- more customer focused employees
What are the main objectives of CRM?
- The integrated view of customers
- Identify potential customers
- Understand needs
- Decrease attrition
- Increase cross usage
- Increase usage of more prestigious items
- Increase satisfaction
- Improve campaign management
- Increase referrals
- Win back lost customers
- Move customers up relationship hierarchy
- Integrate marketing and sales throughout channels
What are the four types of CRM
- Strategic CRM aims to win and keep profitable customer
- Operational CRM focuses on the automation of sales, marketing and service processes
- Analytical CRM focuses on the intelligient data mining for strategical and tactical purposes
- Collaborative CRM applies technology across the organization in order to optimise company, partner and customer value
How can you increase customer lifetime values?
CLV can be increased through:
- Increasing the marging
- increasing the customer retention rate
- reducing discounts
Note: Increasing customer retention rate has greater leverage on customer lifetime value than reducing the discount rate.
How can you improve your CLV?
current customers:
- improve customer retention
- grow customer margins
- and delete
potential customers:
- retrieve
- acquire
- and ignore
What are the major phases of a CRM project?
- Develop the CRM strategy
- Build the CRM project foundations
- Needs specification and partner selection
- Project implementation
- Performance evaluation
What is a “Prospect”?
A prospect (qualified lead) has:
- a need for my product
- the ability to pay
- the authority to buy
What different Sales Closing methods do you know?
- Assumptive Close: Salesperson assumes to be able to take the order and tries „it“
- **Action Close: **Involves customer in the conversation on close
- Choice Close: Lets customer choose „details“ (often used) with alternative question
- Ask for the Order: Close is a good offer, isn‘t it? Or: Would you like to try first … (Do you buy?)
