MKT1017 Report

Word Count: 3468

Index EXECUTIVE SUMMERY............................................................3 INTRODUCTION.....................................................................4 SELLING SKILLS....................................................................5 CUSTOMER SERVICE............................................................14 CREATING A MOTIVATIONAL SELLING ENVIRONMENT........18 CONCLUSION.......................................................................22 REFERENCES........................................................................24

Figures FIGURE 1...............................................................................9 FIGURE 2.............................................................................11 FIGURE 3.............................................................................17 FIGURE 4.............................................................................19 FIGURE 5.............................................................................21 FIGURE 6.............................................................................22

Executive Summery
This report has been written looking into a statement that Russ Berrie made; he stated Nothing happens until you sell something. Therefore this report has looked into three main areas where additional techniques can help improve sales with a business. Selling skills is the first and most important section that shall be looked into throughout this report, specifically this report shall look into the SPIN technique, how to ask question to receive the most useful answers, active listening, communication behaviour and in particular the social style matrix, how to improve presentations, voice characteristics and types of words used throughout conversation in addition to learning how, despite having the skill to sell, some people lack the personal attributes that enable them to be the best, this report will delve into the personal traits that can help as well as those that can hinder sales. Customer service is another area which shall be looked into, this report shall look at market segmentation used to find out who your customers are, it shall mention perceived value and how that has an impact on a customers views, the three-factor, after sales customer service and

will look into how customer service may represent the best opportunity for a firm to increase its market penetration and profitability. Finally this report shall look into how to create a motivation sales environment, there are a multiple of different ideas that shall be put forward, including 6 different theories on motivation, 5 factors that affect motivation as well as the Charted Institute of Marketings views on motivation. The report will finish with a conclusion on the world of retailing as well as stating how important the methods, ideas and theories mentioned throughout this report are.

Introduction
This report will look into many different factors that affect selling within a company; Russ Berrie stated that Nothing happens until you sell something. You dont need accountants, an MIS department, or a credit department until you sell something. (Weitz et al, 2001). There are three primary areas which shall be described in depth throughout this report; selling skills, customer service and creating a motivational sales environment. Within each of these three areas this report will look into how they all affect company sales as well as how to improve these key areas. Throughout the report modern sales methods in addition to wellestablished selling theories shall be considered and put forward,

before an overall conclusion shall be reached which will stipulate a variety of different methods that should be undertaken to improve sales. All topics that shall be discussed throughout this report are areas that people specifically need to be trained in; this is because these all need to be incorporated into the business. Selling is not something that comes naturally to all people and they need to practice, as such this report shall focus largely on selling skills, with slightly less emphasis placed on customer service and creating a motivational sales environment.

Selling Skills
As Russ Berrie stated that Nothing happens until you sell something this section will look into various techniques that can help to increase sales. Selling generally falls into two basic classifications: transactional selling and developmental selling (Warner, 1991, online). Transactional selling focuses primarily on the product, communicating information about products, merchandise, or services and handling the transactions for their sale, buyers make their own decisions, unaided, about how the product satisfies their needs. In developmental selling the focus is shifted from the product to the customer, the product is positioned by the salespeople to meet the needs and to solve the problems of buyers. This shift in emphasis makes a considerable difference in

the degree of difficulty of the two types of selling. In developmental selling the salesperson has to find ways to match the attributes and features of a product to the needs and problems of prospects, one of the best ways to do this is to use the SPIN technique. The SPIN technique consists of asking questions based on the following: Situation (questions) Problem (questions) Implication (questions) Need-payoff (questions)

The bases of the SPIN technique is to ask questions before talking about the product, this way you can find the best product or service that meets the customers needs and wants. The SPIN technique is a very useful way to find information, as research carried out by Neil Rackham who analysed 35,000 sales calls showed in successful sales calls its the buyer who does the most talking (Rackham, 1988) and it is important that all salespeople in the company are trained on this method of selling. It should also be noted however that out of the four different types of questions that could be asked, those that asked the most Situational questions had the most failure in the sales calls, this implies that successful sellers do their homework the find out information about the customer so have to ask less questions about who they are and more about their problems and implications. A key aspect to selling successfully is communication, the SPIN technique mentioned above shows how increased questioning can

help with selling, however no matter how good the question, it is the answer that is important. To get the best and fullest possible answers from customers there are some guidelines that should be followed when asking questions; Allow full response never cut the customer off, or finish their sentences with what you think they mean. Space questions do not bombard the customer with multiple questions, it is not an interrogation, it should be a conversation. Short and simple overly long questions can confuse the customer. Avoid leading questions allow the customer to give their full opinion and do not lead them to any one specific answer. Collect information pay attention to what you are told by the customer, and gather lots of information. Maintain flow of information offer encouragement to the customer, trying to get them to divulge more information. If you can follow these 6 guidelines to asking questions not only should the conversation flow more naturally and build a good rapport with the customer, but it should allow you a chance to listen to the customers answers. In selling you not only need to listen, but listen actively, Shepherd et al. (1997) found that effective listening includes creating a situation in which the speaker wants to share information, accurately adding meaning to the message being

received, evaluating, the message and providing feedback. Sales people in every company need to listen to their customers so they can best satisfy their needs, and the salespersons ability to actively listen to customer comments, feedback, and complaints should be seen as key to improving sales performance, especially when it comes to developing long term buying relations with customers (Johike, 2006, online). There are other important factors that also need to be considered when looking into selling. The social style matrix is a training method that is designed to help salespeople to adapt their communication behaviour. The figure below (figure 1) shows how people can be categorised based on how responsive compared to how assertive they are.

Figure 1

It is very useful, firstly if you can identify what your own type of communication behaviour is as you can then be more aware of how you may come across to customers. Secondly you need to be able to identify the customers social style so you can then alter your own style to best accommodate the customer, this is because it has been suggested that high performance occurs through accurately classifying customers and adjusting ones natural social style to be more congruent with the customers social style (Sujan, Weitz & Sujan, 1988, online). Therefore training salespeople in this area should make a significant improvement to sales.

Weitz et al. (2009) stated that there are three main types of presentation:

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Figure 2

Each presentation method mentioned above put forward by Weitz et al. involves a varying level of skill. The standard memorized presentation method can be delivered at low cost by unskilled salespeople with little training conversely, the customized presentation can be very costly, requiring highly skilled people (pp. 150) it is therefore important that the type of presentation that you choose to give is equal to, or lower than, your own personal level of skill.

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Whilst giving presentations and talking to the customers, it is the salespersons voice and their delivery of their words that affect the customers level of understanding and how they evaluate the given presentation. Weitz et al. (2009) state that poor voice and speech habits make it difficult for customers to understand the salesperson message, voice characteristics include; rate of speech, loudness, inflection, and articulation in addition to the choice of words. The choice of words used can make a massive impact on the effectiveness of the presentation, whether the words you use are abstract or concrete, are they emotional or neutral; all these can make a big difference on whether you have a successful or failed presentation. Furthermore, the descriptive powers of the words you use have a big impact, it is said that a picture is worth 1000 words (Barnyard, 1921) so it is worth being descriptive enough for the potential customer to see how beneficial the product is. The normal rate of speech is 140 words per minute; however salespeople should vary their rate of speech depending on the nature of the message. Additionally whilst giving a presentation or a sales pitch to a potential customer, there are additional techniques that should be taken advantage of for maximum effectiveness, for instance stories are a great way to make a point effectively. Great stories often include conflicts, trials and crises; they should help the listener think through choices and outcomes of those decisions. The

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most effective stories often include analogies that can help the customer see how that any problem that may arise could be solved. Robertson (2009) stated that confidence and competence do not go hand in hand. A salesperson can learn a lot about how to sell and there are lots of different techniques that they can learn, however, Robertson stated that it is the attitude that people have that can determine whether or not they are a successful salesperson, those that are likeable, friendly and confident tend to be more successful salespeople. What Robertson concluded was that you need to have the ability to access those selling skills that you have; this will enable you to be able to perform at your best, to do this you need to have the specific traits that make a good seller. McCall (2011) stated that there are 5 traits that make a successful salesperson, these are: Creativity Passion Integrity Tenacity Commitment

McCall also believed that some traits would doom any salesperson these traits include: Lack of integrity Being unprepared Dishonesty 13

It is therefore important as a sales manager to know what traits the people you employ have and to make sure that you not only encourage the positive traits, but you need to try to minimise any/all of the negative traits held by any individuals who are in your sales force. As stated by Robertson, it is those people with the personal traits that can then become better sellers with different techniques mentioned in this report; it is far more challenging to teach people to be more creative, or to have more passion and integrity, therefore in the selection process of selecting employees, it is these traits that are more desirable than those that have the techniques of how to sell.

Customer Service
A key factor that influences consumers choice of retailers, and other service providers, is the level of customer service provided. However, before this report will look into how to improve customer service or why it is imperative to get right in a business situation, this report shall briefly look into market segmentation and how that can impact on customer service. Smith proposed the concept of market segmentation in 1956 which he stated involves viewing a heterogeneous market as a number of smaller homogeneous markets, in response of differing preferences, attributable to the desires of customers for more precise

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satisfactions of their varying wants. What Smith is stating is that you cannot look at the entire market as one diverse group; instead you need to look at the market as lots of smaller different groups with individual needs and wants. There are multiple reasons to segment a market, within the area of customer service the main reason is companies know that they cannot appeal to all buyers in the market place, or at least not all in the same way (Kotler, Armstrong, Wong & Saunders, 2008). It is therefore essential for companies to separate the market into smaller groups; these groups can then be targeted more effectively and efficiently, saving both money and time, furthermore by knowing exactly who your customers are and what they are like, you can best identify and therefore satisfy their needs and wants more successfully. Therefore, different market strategies are needed to be developed for customers in different markets, this is so you can increase not only customer satisfaction, but also expected profits to a company (Hung & Tsai, 2008, online). Once you have identified the market segment you are aiming at, it is then important to look into how to satisfy your customers. Many people choose to shop at certain stores, do their banking at a particular financial institution or stay at a specific hotel, etc., based on the level of customer service provided by that establishment. Customers tend to buy from the firm that offers them the highest customer perceived value (Kotler, Armstrong, Wong & Saunders,

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2008, p24). The customer perceived value is the evaluation of the differences between all the benefits and all the costs that each company can offer. There are aspects of customer service that affect perceived value, such factors as the level of responsiveness, friendliness, reliability, and promptness of employees (Kerin et al., 1992; Zeithaml et al., 1988). Perceived value can make a massive impact on where consumers purchase their goods from. There are different types of retailers, this report shall look into service retailers and how important customer service can be for them. Retailers selling services face different problems than their counterparts selling tangible goods or merchandise. The service retailer attempts to create quality, value and tangibility, and uses these factors to produce a point of difference. (Newman and Cullen, 2002), so in an attempt to create quality, value and tangibility, service retailers need to use greater levels of customer service to distinguish between them. There are five basic services that retailers offer to their customers, they are: accessibility of location convenience of timing choice of products information about products convenience of size (appropriate quantities)

These are services that the bigger, super retailers can offer. By having these services companies can set themselves apart from

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their competition, Tescos is the top retailer in the UK with 31.4% of the market () and has put a real emphasis on these 5 services, showing how much of an impact and change these can make. These 5 services however are things that all stores can not alter necessarily as quickly as others, therefore this report has also looked at the three-factor theory that Matzler & Sauerwein (2002) hold. The three factor theory looks into identifying three main criteria that can affect how satisfied a consumer is depending on the level of customer service that they receive.

Figure 3

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The three factor theory is useful as it shows that companies need to get the basics right first as they are the main causes of dissatisfaction. It should therefore be noted that before trying to excite the customers with unexpected actions, businesses should perfect the actions that customers perceive as expected. Furthermore, the performance factors which are specific to each customer as they directly connect to their explicit needs and desires, (Fuller & Matzler, 2007, online) therefore communication and interaction with the customers is extremely important. In addition to this Blodgett, Wakefield and Barnes (1995) put forward the idea that the level of customer service consumers can expect to receive after the sale, should a problem arise, is also a large contributor to how happy people are with the service that they receive. In fact customer service may represent the best opportunity for a firm to increase its market penetration and profitability. (Stirling and Lambert, 1987)

Creating a Motivational Selling Environment

It is possible to have lots of different selling skills and abilities, but without the right motivation you would still be an unsuccessful salesperson. This is because an increased motivation causes the following: Increased creativity

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Working smarter Working harder Use win-win negotiation tactics Higher self-esteem More positive emotional tone Enhanced relationships

(Jobber & Lancaster, 2006, p402) all of which are important to make a successful salesperson. There are two different types of motivation, intrinsic and extrinsic motivation, whereas intrinsic motivation comes from within, extrinsic is externally controlled; the most effective kind of motivation is intrinsic. There have been many different theories on motivation; Jobber and Lancaster (2006) have collated 6 different theories:

Figure 4

The 6 different motivational theories mentioned above are all of great use and should be looked into, this report shall focus on

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Vrooms expectancy theory, and will show how his theory could be used and applied to increase sales figures. Vroom (1964) suggested that people consciously choose particular courses or actions, based upon perceptions, attitudes and beliefs, due to their desires to enhance pleasure and avoid pain. The expectancy theory states that individuals feel motivates when three conditions are perceived: 1. The personal expenditure of effort will result in an acceptable level of performance 2. The performance level achieved will result in a specific outcome for the person 3. The outcome attained is personally valued

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What this is stating is that people will generally put in the minimum amount of needed effort for the maximum gain; therefore to get the most out of a salesperson, you need increase the acceptable level of performance, and increase the value of the outcome attained if higher levels of performance are met. Practically this means that different bonuses are required for people that perform higher, this is further supported by Jobber and Lancaster who state there are 5 factors that affect motivation.

Figure 5

When using Vrooms expectancy theory you are looking into financial incentives by giving financial rewards, also by setting sales targets you are giving salespeople a challenge, which increases motivation further.

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There are other factors that can affect motivation; the charted institute of marketing (CIM) found that there are an additional 8 factors which sales managers viewed would increase motivation. They are:

Figure 6

All of these factors should be addressed within a company to make sure that the salespeople in the organisation are motivated as an increase in motivation can make a massive impact into the productivity of the business.

Conclusion
Shops are under threat, the world of extreme model by Gagnon and Chew state that specialist stores should become more specialist and the big stores are becoming bigger, the internet is a massive threat

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to these stores and the only way to overcome the threat of the internet to the high street is through change. This report has mentioned a large number of different selling techniques, different ways to increase and improve customer service as well as different reasons why motivation is important in addition to how to improve staff motivation. All methods, ideas and theories put forward in this report should be used to improve sales and performance with the company; in addition they will make salespeople happier and more productive. Russ Berries statement Nothing happens until you sell something... (Weitz et al, 2001) is an important statement, the three primary areas discussed in depth throughout this report show how you can increase sales. The topics discussed in this report are areas that people specifically need to be trained in, as stated selling is not something that comes naturally to all people. Salespeople need to practice and if salespeople are trained in these topics then sales and performance will increase, you will then need the accountants, an MIS department, and a credit department as you are selling. If, as a company, you can implement the suggestions mentioned throughout this report you should be able to increase sales, increase productivity, increase motivation and increase overall business success.

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