N5 Sales Management 1. Prospecting techniques
Prospecting is the first step in the personal selling process. Prospecting is the identification of a person or business that has a need, authority and the means to pay for the product. Effective prospecting enables the salesperson to spend more time on sales presentations and the successful closing of transactions.
Prospecting means lead generation (finding leads) by using the prospecting techniques. In step 2 of the selling process, Pre-approach, the salesperson qualifies the leads as actual prospects and hopefully turns as many prospects as possible into customers (see Sales funnel below). Not all leads qualify as prospects. A salesperson from Nike might find a lead (someone that is very interested in the new Nike running shoe) but already bought another pair recently. So the lead has no need for the salesperson’s product and therefore does not qualify as a prospect.
The techniques used will depend on the industry, for example insurance, property, retail, etc., the size of the business, the product or service sold, the competitors, types of customers and the salesperson. The salesperson will choose the technique which best suits his personality, knowledge, product and field of experience.
1.1 Endless-chain technique
The salesperson gets the names of family, friends and acquaintances from every customer to whom he sells to. The already satisfied customer will recommend the names of people whom he thinks will also benefit by the product/service and can afford it.
The salesperson deliberately builds the technique into each sales call. He can also request names from prospects who he has not sold to, although it is easier to get names from satisfied customers.
Although this technique can be used with most products/services, it works best with services (intangibles) such as gym membership, investments and insurance.
This technique offers the salesperson various advantages: • Prospecting and approach times are reduced. • Appointments are more easily obtained. • The prospect has to an extent already been qualified in terms of need/use and ability to buy, by the person who referred him to the salesperson. • A satisfied customer is a good reference.
1.2 Influence centres
A centre of influence is usually a person, public figure or an organisation who has gained the honour, respect and admiration of the community, business and industry, who others look up to. People respect such a person’s judgement and are keen to follow his example in everything he does.
Salespeople must use their existing customers, who qualify as centres of influence as references, once permission has been obtained to do so.
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