99THTH EDITION EDITION

CHAPTER 8CHAPTER 8DEVELOPING AND DEVELOPING AND QUALIFYING A QUALIFYING A PROSPECT BASE PROSPECT BASE

Manning and Reece

8-2

PROSPECT AND PROSPECTING

DEFINEDPROSPECT—A potential customer that meets the qualification criteria established by your company

PROSPECTING—Identifying potential customers

8-3

IMPORTANCE OF PROSPECTING

Every salesperson must cope with Every salesperson must cope with customer attritioncustomer attrition--Customers move, firms go out of --Customers move, firms go out of

business, sales lost to competitionbusiness, sales lost to competition

--Average company may lose 15-20% of --Average company may lose 15-20% of customer base every yearcustomer base every year

See Figure 8.1 8-4

GIRARD’S FERRIS WHEEL—SUPPLY

P

P

P

P

P

REFERRALSREFERRALS

FRIENDSFRIENDS

DIRECTORIESDIRECTORIES

TRADE SHOWSTRADE SHOWS

WEBSITES/DATABASESWEBSITES/DATABASES

COLD CALLINGCOLD CALLING

NETWORKINGNETWORKING

See Figure 8.1 8-5

GIRARD’S FERRIS WHEEL—LOSS

P

P

P

P

P

RELATIONSHIP FAILSRELATIONSHIP FAILS

BUSINESS FAILSBUSINESS FAILS

BUYS FROM ANOTHERBUYS FROM ANOTHER

MERGER/ACQUIREDMERGER/ACQUIRED

CUSTOMER MOVESCUSTOMER MOVES

DEATH OF CUSTOMERDEATH OF CUSTOMER

ONE TIME PURCHASERONE TIME PURCHASER

TECH CAUSES CHANGETECH CAUSES CHANGE

8-6

PROSPECTING REQUIRES PLANNING

INCREASE NUMBER OF PEOPLE INCREASE NUMBER OF PEOPLE WHO BOARD FERRIS WHEEL WHO BOARD FERRIS WHEEL

IMPROVE THE QUALITY OF IMPROVE THE QUALITY OF PROSPECTSPROSPECTS

SHORTEN SALES CYCLE BY SHORTEN SALES CYCLE BY DETERMINING WHICH DETERMINING WHICH PROSPECTS PROSPECTS ARE “QUALIFIED”ARE “QUALIFIED”

8-7

REFERRALS

Prospect recommendedProspect recommended–by current –by current satisfied customer or one satisfied customer or one

____________________________________________________________________

Endless chainEndless chain –ask contact who else –ask contact who else could _______________________could _______________________

Friends, family members, centers Friends, family members, centers of of influenceinfluence –a person may not –a person may not make make decision but has influence on decision but has influence on those those who do…_____________________who do…_____________________

8-8

DIRECTORIES/LISTS Hundreds of business and Hundreds of business and industrial industrial directories availabledirectories available

Each major trade association Each major trade association usually publishes directory usually publishes directory

Be sure to use current copy or Be sure to use current copy or edition as prospects shift edition as prospects shift

firms…track people firms…track people andand companies companies

8-9

TRADE SHOWS/PUBLICATIONS Trade shows and conventions Trade shows and conventions ––your company may have a booth your company may have a booth at key trade shows/expositions at key trade shows/expositions Trade publicationsTrade publications–each industry –each industry has trade publications that has trade publications that ____________________________________________________________ Join Trade Associations Join Trade Associations –many –many salespersons join trade salespersons join trade associations to associations to ____________________________________________________________

8-10

TELEMARKETING Telemarketing Telemarketing – employs phone – employs phone

outreach to accomplish many outreach to accomplish many objectivesobjectives

--to identify buyers and generate --to identify buyers and generate contact lists for sales staffcontact lists for sales staff

--to qualify prospects--to qualify prospects--to verify sales leads generated by --to verify sales leads generated by

other methodsother methods--to conduct follow-ups--to conduct follow-ups

8-11

DIRECT RESPONSE

Direct response advertisingDirect response advertising-often -often features inquiry cards or features inquiry cards or

information information requests via mail requests via mail or or telephonetelephone

Sales LettersSales Letters—send sales letters —send sales letters to to decision makers, then decision makers, then ____________________

8-12

WEBSITE

Websites Websites –provide cost-effective –provide cost-effective way for sales professionals toway for sales professionals to

--project personal image--project personal image

--provide additional information--provide additional information

--generate leads from visitors to --generate leads from visitors to sitesite

--present product information--present product information

--establish e-mail lists--establish e-mail lists

8-13

DATABASES In-house databases In-house databases –your firm may –your firm may

already have a comprehensive already have a comprehensive database…sometimes referred to database…sometimes referred to

as as the “house list” with details on the “house list” with details on customers, purchase patterns customers, purchase patterns

List sourcesList sources—wide range of precise lists —wide range of precise lists available from variety of sourcesavailable from variety of sources

--list brokerage firms, associations, --list brokerage firms, associations, governmental records, related but not governmental records, related but not

directly competitive businesses directly competitive businesses

8-14

COLD CALLING

Simply calling prospects without Simply calling prospects without referrals referrals --new salespeople rely on these as --new salespeople rely on these as they haven’t built referral base they haven’t built referral base --must be strategically planned --must be strategically planned --prelude to in-person appointment--prelude to in-person appointment

8-15

NETWORKING

Making and profiting from Making and profiting from personal connectionspersonal connections

Networking guidelinesNetworking guidelines--Meet as many people as you can--Meet as many people as you can

--Tell them what you do--Tell them what you do

--Don’t do business while networking--Don’t do business while networking

--Offer business card--Offer business card

--Edit contacts and conduct follow-ups--Edit contacts and conduct follow-ups

8-16

EDUCATIONAL SEMINARS

Provides opportunity to showcase Provides opportunity to showcase product without pressuring to buyproduct without pressuring to buy

Requires extensive preparationRequires extensive preparation

Starts value-added processStarts value-added process

Can attend or present at industry- Can attend or present at industry- sponsored seminars or offer your sponsored seminars or offer your ownown

8-17

NON-SALES EMPLOYEES

Non-sales personnel can be Non-sales personnel can be valued source of leads valued source of leads

Prospecting not necessarily Prospecting not necessarily exclusive task of sales forceexclusive task of sales force

Non-sales personnel often need Non-sales personnel often need training and incentivestraining and incentives

8-18

COMBINATION APPROACHES

Salespersons generally rely on Salespersons generally rely on combination of prospecting combination of prospecting methodsmethods

Some methods have higher yield Some methods have higher yield than othersthan others

Important to use CRM technology Important to use CRM technology to help maximize efficiency to help maximize efficiency

8-19

QUALIFYING PROSPECTS KEY TIME-SAVING PROCESSKEY TIME-SAVING PROCESS

1.1. Does prospect need my Does prospect need my product? product?

2.2. Can prospect make buying Can prospect make buying decision?decision?

3.3. Can prospect pay for purchase?Can prospect pay for purchase?

4.4. Can anyone close sale? Is sale Can anyone close sale? Is sale realistically possible?realistically possible?

8-20

ORGANIZING PROSPECT INFORMATION

PROSPECT AS PROSPECT AS INDIVIDUALINDIVIDUAL

PROSPECT AS PROSPECT AS BUSINESS BUSINESS REPRESENTATIVEREPRESENTATIVE

Last slide Chapter 8. 8-21

PROSPECTING AND SALESFORECASTING PLANS IMPORTANT TO BALANCE TIME IMPORTANT TO BALANCE TIME AND ORGANIZE CONTACTSAND ORGANIZE CONTACTS

1.1. Prepare a list of prospectsPrepare a list of prospects2.2. Forecast potential sales volume Forecast potential sales volume

for each new account, by for each new account, by product product

3.3. Carefully plan the sales Carefully plan the sales routeroute to to minimize time and costminimize time and cost