Selling and Marketing Process
NEN Advanced Courses
Getting to Market: Commercializing your Idea
Selling and Marketing Process
• The Selling Process Chart
– Prospect
– Qualify
– Present
– Close
– Service
Rethinking the Sales Force:
The New Selling 1
• Selling is being transformed, much like
manufacturing has been in the past
• Sales organizations are changing: not size or
geography centric any more
• What does selling actually mean?
• The ecosystem has become more important as
‘no company is an island’
• The impact of widespread information is one
reason
3
Rethinking the Sales Force : The New
Selling 2
• What is the reason for a sales force?
– To communicate the value of the product or
service to the customer
– To ensure that customer needs are taken care of
– To take customer feedback for future products
and services
– To inform customers of the latest and greatest
technologies and innovations they bring
8/22/09
IIM Bangalore, PGSEM, Jun-Aug 09,
Managing Tech Innovation
4
Rethinking the Sales Force : The New
Selling 3
• In the new world of selling, the sales force has to
concentrate on:
– Creating value for customers
– Not just communicating inherent value
• New ‘marketing myopia’ to be overcome, which
has the wrong belief that:
– Marketing and engineering creates value
– Sales force simply makes customers aware of the
value
8/22/09
IIM Bangalore, PGSEM, Jun-Aug 09,
Managing Tech Innovation
5
Rethinking the Sales Force : The New
Selling 4
• Why are some companies struggling?
– Take some well-known examples of companies
that are shrinking in revenue
– What causes them to be in trouble?
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8/22/09
Environmental reasons including legal/regulatory
Marketplace changes, disruptive technologies
Demographic and macroeconomic changes
Vicious competition
What can the sales force do?
How do long-successful companies survive?
IIM Bangalore, PGSEM, Jun-Aug 09,
Managing Tech Innovation
6
Rethinking the Sales Force : The New
Selling 5
• What is customer value?
– Value = Benefit – Cost
• Increase value by increasing benefits or by
decreasing costs
• Examples?
– Company that wants more value
– Company that wants less cost
• Value proposition may be key to segmenting
customers, not size
8/22/09
IIM Bangalore, PGSEM, Jun-Aug 09,
Managing Tech Innovation
7
Rethinking the Sales Force : The New
Selling 6
• Matching investments by customer
– Where are they investing or willing to invest in you
by paying you a premium?
– Avoid wasting energy on something that a
particular customer does not need or want
– Avoid under-investing in areas that are important
to them since you risk losing them
• Sales force needs to figure this out customer by
customer, no recipes for one-size-fits-all
8/22/09
IIM Bangalore, PGSEM, Jun-Aug 09,
Managing Tech Innovation
8
Rethinking the Sales Force : The New
Selling 6
• Types of customers
– Intrinsic value
– Extrinsic value
– Strategic value
• Appropriate sales stance
– Transactional selling
– Consultative selling
– Enterprise selling
8/22/09
IIM Bangalore, PGSEM, Jun-Aug 09,
Managing Tech Innovation
9
The New Buying Reality 1
• Adding value in the three selling modes
– Transactional Sales
• Sophisticated customers or commodity buys
• Make sales process painless, low-cost, hassle-free
– Consultative Sales
• Customers haven’t fully identified needs
• Early in process, help them define needs/solutions
– Enterprise Sales
• Total assets and capabilities of both parties used
• All across the value chain, insights into customer
problems, function to function interfaces, ecosystem of
third parties, value and culture fit
10
The New Buying Reality 2
• But what about relationship selling?
– Zone of Indifference
• Assuming other things are equal, the best-liked
salesperson gets the sale
– Relationship helps get in the door, but value
creation is the key
– Building trust more likely if
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Frequent interaction and consistent behavior
Trust in product: transaction sale
Trust in the people who sell/support: consultative
Trust in institution: enterprise sale
11
The New Buying Reality 3
• There is no one *best* selling mode
• Match selling mode to customer type
• How to lose your shirt
– Consultative sale to intrinsic value customer
– Enterprise sale to intrinsic or extrinsic value customer
– Transactional sale to strategic value customer
• Prosper
– Transactional sale to intrinsic value customer
– Consultative sale to extrinsic value customer
– Enterprise sale to strategic value customer
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Sales Management
Sales management
• Formulation
• Implementation
• Evaluation
• One best-practice model does not work
for all sales situations
• Value addition in the buying process
– Recognition of needs: what?
– Evaluation of options: how
– Resolution of concerns: issues
– Purchase: making in painless
– Implementation: training, support,
advice
Sales Learning Curve
• The temptation to ramp up sales force to increase
the number of customers
• Hiring a full sales force too early leads to burning
cash and failure in meeting revenue expectations
• Smart companies give themselves time and
money to climb the sales learning curve
• Sales learning curve is analogous to a
manufacturing learning curve
• Launching a new product is not just hiring a sales
force and asking them to sell once the product is
launched
Sales Learning Curve : New Product,
New Market
Sales Yield
REVENUE GAP
Standard
Quota
Time
Source: Sales Learning Curve, By Mark Leslie and Charles.A.Holloway, HBR Jul-Aug 2006
Sales Learning Curve: Follow-on
Product, Existing Market
Sales Yield
REVENUE
GAP
Standard
Quota
Time
Source: Sales Learning Curve, By Mark Leslie and Charles.A.Holloway, HBR Jul-Aug 2006
Go To Market Strategy for New Product
Initiation
Phase
Transition
Phase
Execution
Phase
Sales Yield
Traction point
Break-even
point
Time
Source: Sales Learning Curve, By Mark Leslie and Charles.A.Holloway, HBR Jul-Aug 2006
Customer Management
• Investing in value creation
• Rich understanding of customer’s needs and their
customers’ needs in consultative sale
• Customer Relationship Management
18
Case Discussion
• Case: Hunter Business Group: Team TBA
• Chapter 38, Marketing Management , Text and Cases:
Rajiv Lal , John Quelch and Kasturi Rangan, Tata
McGraw Hill Publication
References
• The Sales Learning Curve – By Mark Leslie and
Charles.A.Holloway, Harvard Business Review ,
Jul-Aug 2006
• Book: Rethinking the Sales Force: Redefining
Selling to Create and Capture Customer Value,
Neil Rackham and John DeVincentis, Published by
McGraw-Hill, 1999