This lesson introduces you to the concept of personal selling. You will learn about the steps in the personal selling process, including how to close a deal.
Our farmer needs to increase his revenue. The town bank has just informed him that he is falling behind in his mortgage payments. He needs $4,000 a month to be able to save his farm!
The entire Farmer family had an emergency meeting, and has decided that the best chance of saving the farm is to add flowers as one of their products. They’ve always had luck with their family soil growing beautiful flowers, and this might be the solution! He has decided to go town to town and try to sell his flowers at the local floral shops.
Personal selling is part of the overall promotional mix, which also contains advertising, sales promotion, and public relations. Personal selling is when a personal paid-for communication occurs between two people in an attempt to influence each other.
Benefits of Personal Selling
The farmer knows that in order to save his family’s farm, he will need to choose the correct path to sell his flowers. Personal selling is the farmer’s best choice in marketing because he can demonstrate his products. He can talk to the floral owners and even leave samples of his twigs and flowers with the shop to demonstrate his high-quality assortment.
Another reason is that the farmer can tailor his sales pitch to each floral shop depending on their needs. For example, one shop might just want roses and expensive flowers, while another might just want twigs to create centerpieces.
Personal selling also allows him to determine if the floral shop would fit the description of his ideal customer. Perhaps one shop is going out of business or another already grows their flowers out back. He can adjust his customer list and not waste any time in the future calling on them.
The general rule is that personal selling should be used when the target market is small in size and when the product is complicated and/or costly. The farmer will be selling in a small market and due to the variations in the products that he sells, and the variations in customers’ needs, personal selling is the ideal marketing approach for him.
Personal Selling Steps
The steps of personal selling are also knows as the sales process or cycle. The steps are what a salesperson has to go through to sell a particular product or service. Some sales are very quick, such as when the farmer has to sell his tomatoes from his road side cart. Other sales can take long to complete due to the expense or technical nature of the product. The personal selling steps are: generating leads, qualifying leads, approaching the customer and probing needs, developing proposing solutions, handling objections, closing the sale, and following up.
Let’s take a look at the first step our farmer must learn. Lead generating (or prospecting) is when the farmer identifies the people in the geographic area who are most likely to buy his product. He can’t waste his time calling on every store or floral shop. He needs to either send out a postcard, make phone calls or even sales calls. The farmer can also network by going to town meetings or chambers. The farmer may also find customers through referrals. Referrals are when friends recommend your business to their friends. This word of mouth is usually the best way of gaining customers.
The second step in the personal selling process is qualifying a lead. Not every person that shows interest in potentially buying the farmer’s flowers will be a good lead. Lead qualification occurs when a person has a recognized need, a willingness to see a salesperson, and buying power. If the potential customer is lacking in any of the three items, then they would not be a good investment of time for the farmer.
Approaching the Customer and Probing Needs
Now that the farmer has developed an excellent set of leads, he needs to do his homework. The farmer should research or conduct a preapproach where homework is completed on the customer. Some examples would be the type of flowers they offer their financial situation, if possible; and perhaps, gather information that is available publicly. The farmer should try to create a needs assessment of the customer by creating a customer profile. This can be done by a quick phone call or even a short postcard survey. The ultimate goal of the farmer is to figure out what issues the floral shops may have, and how he can solve them with his homegrown products.
Developing and Proposing Solutions
Our farmer has conducted a ton of research and now has a list of places to make appointments for sales calls. The farmer has created a short presentation in which he will make a sales proposal to a prospective florist. He should have a list of his recommendations, and how he can help them solve a current issue. The issue could be as simple as stocking fresher flowers or making more money by offering his product at a lower cost. Our farmer has created a stunning presentation that is short and vividly impactful. He has offered great prices and left a bouquet of sample products for free. Unfortunately, not every sales call ends with a sale. The farmer needs to handle any objections from the potential customer next and not give up!
The floral shop that the farmer visited today loved his products! The objection they had was concerning the price. The farmer offered them a 10% discount if they would pay within 30 days. The extra discount was all the shop needed. He closed the sale! Sometimes potential customers will say that they prefer a competitor. It’s always important for the farmer to know his competition, so he can explain why his flowers and service are superior.
Closing the Sale
Our farmer was able to save the farm! He successfully closed the deal of $4000 worth of floral business this month. How did he do it? He was sure to ask for the sale after the presentation, and he was a good negotiator. He never gave up on a client and handled every objection that was thrown his way. Lastly, he emphasized his good quality and was always polite and professional.
Good salespeople realize that after a sale is closed, they still need to follow up with excellent customer service. Follow up is when the farmer ensures delivery of the flowers, that the quality is excellent and that he answers all of the shop’s questions. The farmer makes sure that he calls after each order and thanks the shop for the business. Emails and postcards are also used to remind the shops about his products, and to let them know that he will never forget his customers. His ultimate goal is to create a relationship selling experience.
Relationship selling is when a company builds and maintains an ongoing relationship with their clients in order to develop long term partnerships. Our farmer realizes the value of a previous customer who has purchased his product. He will cultivate relationships with past shops in order to secure future orders. He will offer the stores extra help, such as tips on floral arrangements, sales contests, and excellent customer service.
Personal selling is part of the overall promotional mix, which also contains advertising, sales promotion and public relations. Personal selling is when a personal paid-for communication occurs between two people in an attempt to influence each other. The personal selling steps are generating leads, qualifying leads, approaching the customer and probing needs, developing proposing solutions, handling objections, closing the sale, and following up. Finally, relationship selling is when a company builds and maintains an ongoing relationship with their clients in order to develop long-term partnerships.
After watching this lesson, you should be able to:
- Define ‘personal selling,’ and its role in the promotional mix
- Explain each step of the personal selling process
- Identify the importance of relationship selling to a company