Accompaniment visit / report - when a manager
or supervisor or trainer accompanies a sales person while working on the
sales territory, usually while meeting prospects or customers. Typically
the manager would complete a an accompaniment visit report on the performance
of the sales person, which would be discussed, and suitable follow-up actions
or training agreed.
Account - a customer, usually a business-to-business
organization; a major account is a large organization; a national account
is a customer with branches or sites that constitute a nationwide coverage,
which typically requires special pricing and senior sales attention.
Added value - the element(s) of service or
product that a sales person or selling organization provides, that a customer
is prepared to pay for because of the benefit(s) obtained. Added values
are real and perceived; tangible and intangible. A good, reliable, honest,
expert, informed sales person becomes a very significant part of the selling
organization's added value, as perceived by the customer, if not by the
selling organization.
Advantage - the aspect of a product or service
that makes it better than another, especially the one in-situ or that
of a competitor.
Advertising / advertising and promotion - the
methods used by a company to publicise and position its products and services
to its chosen market sectors, including product launches, image and brand
building, press
and public relations activities, merchandising (supporting and
promoting the product in retail and wholesale outlets), special offers,
generating leads and enquiries, and incentivising distributors, and agents,
and arguably sales people. A&P methods are sometimes described as above-the-line
(media
advertising such as radio, TV, cinema, newspapers, magazines, business
publications,...) or below-the-line (non-'media' methods or materials
such as brochures, direct-mail, exhibitions, telemarketing, and PR);
advertising
agencies generally receive a commission (discount 'kick-back')
from above-the-line media services, but not from below the line services,
in which case if asked to arrange any will seek to add a mark-up.
Appointment - a personal sales visit to a prospect,
usually arranged by phone.
Benefit - the gain (usually a tangible cost,
but can be intangible) that accrues to the customer from the product or
service.
Buyer - most commonly means a professional
purchasing person in a business; can also mean a private consumer. Buyers
are not usually major decision-makers, that is to say, what they buy,
when and how they buy it, and how much they pay are prescribed for them
by the business they work for. If you are selling a routine repeating
predictable product, especially a consumable, then you may well be able
to restrict your dealings to buyers; if you are selling a new product
or service of any significance, buyers will tend to act as influencers
at most.
Buying signal - a buying signal is a comment
from a prospect which indicates that he is visualising to whatever extent
buying your product or service. The most common buying signal is the question:
"How much is it?" Others are questions or comments like: "What colours
does it come in?", "What's the lead-time?", "Who else do you supply?",
"Is delivery free?" "Do you use it yourself?", and surprisingly, "It's
too expensive."
Buying warmth - behavioural, non-verbal and
other signs that a prospect likes what he sees; very positive from the
sales person's perspective, but not an invitation to jump straight to
the close.
Call / calling - a personal face-to-face visit
or telephone call by a sales person to a prospect or customer. Also referred
to a sales call (for any sales visit or phone contact), or cold call (in
the case of a first contact without introduction or notice in writing).
Canvass / canvassing - cold-calling personally
at the prospect's office or more commonly now by telephone, in an attempt
to arrange an appointment or present a product, or to gather information.
Close / closing - the penultimate step of the
'Seven Steps of the Sale' selling process, when essentially the sales-person
encourages the prospect to say yes and sign the order. In days gone by
a Sales person's expertise was measured almost exclusively by how many
closes he knew. Thank God for evolution. See the many examples of closes
and closing techniques in the Seven Steps section, but don't expect to
kid any buyer worth his salt today, and using one might even get you thrown
out of his office. Use with great care.
Coaching / Coach - Business coaching focuses
on helping a business owner to create a distinctive business plan with
its own identity.
Business coaching can operate in any segment of commerce: from
traditional businesses to entrepreneurial
start-ups to e-businesses. See BizEntrepreneur.com & CoachZilla.com
Collaboration selling - also known as collaborative
selling and facilitation selling - very modern and sophisticated, in which
seller truly collaborates with buyer and buying organization to help the
buyer buy. A logical extension to 'strategic' or 'open plan' selling.
Concession - used in the context of negotiating,
when it refers to an aspect of the sale which has a real or perceived
value, that is given away or conceded by seller (more usually) or the
buyer. One of the fundamental principles of sales negotiating is never
giving away a concession without getting something in return - even a
small increase in commitment is better than nothing.
Consultative selling (consultation selling)
- developed by various sales gurus through the 1980's by Neil Rackham
and David Sandler among others, and practiced widely today, consultative
selling was a move towards more collaboration with, and involvement from,
the buyer in the selling process.
Customer - usually meaning the purchaser, organization,
or consumer after the sale. Prior to the sale is usually referred to as
a prospect.
Cycle - see sales cycle.
Deal - common business parlance for the sale
or purchase (agreement or arrangement). It is rather a colloquial term
so avoid using it in serious company as it can sound flippant and unprofessional.
Decision-maker - a person in the prospect organization
who has the power and budgetary authority to agree to a sales proposal.
On of the most common mistakes by sales people is to attempt to sell to
someone other than a genuine decision-maker. For anything other than a
routine repeating order, the only two people in any organization of any
size that are real decision-makers for significant sales values are the
CEO/Managing Director/President, and the Finance Director. Everyone else
in the organization is generally working within stipulated budgets and
supply contracts, and will almost always need to refer major purchasing
decisions to one or both of the above people. In very large organizations,
functional directors may well be decision-makers for significant sales
that relate only to their own function's activities.
Deliverable(s) - an aspect of a proposal that
the provider commits to do or supply, usually and preferably clearly measurable.
Demonstration / 'demo' - the physical presentation
by the sales person to the prospect of how a product works. Generally
free of charge to the prospect, and normally conducted at the prospect's
premises, but can be at another suitable venue, eg., an exhibition, or
at the supplier's premises.
Demographics - the study of, or information
about, people's lifestyles, habits, population movements, spending, age,
social grade, employment, etc., in terms of the consuming and buying public;
anyone selling to the consumer sector will do better through understanding
relevant demographic information.
Discipline - within the context of an organization
this means the same as function, ie job role.
Entrepreneur - [en·tre·pre·neur] - A person
who organizes, operates, and assumes the risk
for a business venture. [French, from Old French, from entreprendre,
to undertake]. See BizEntrepreneur.com
FAB's - features advantages benefits
- the links between a product description, its advantage over others,
and the gain derived by the customer from using it. One of the central,
if now rather predictable, techniques used in the presentation stage of
the selling process.
Feature - an aspect of a product or service,
eg., colour, speed, size, weight, type of technology, buttons and knobs,
gizmos, bells and whistles, technical support, delivery, etc.
Field - means anywhere out of the sales office.
Field sales people or managers are those who travel around meeting people
personally in the course of managing a sales territory. To be field-based
is to work on the sales territory, as opposed to being office-based.
Forecast / sales forecast - a prediction of
what sales will be achieved over a given period, anything from a week
to a year. Sales managers require sales people to forecast, in order to
provide data to production, purchasing, and other functions whose activities
need to be planned to meet sales demand. Sales forecasts are also an essential
performance quantifier which feeds into the overall business plan for
any organization. Due to the traditionally unreliable and optimistic nature
of sales-department forecasts it is entirely normal for the sum of all
individual sales persons' sales annual forecast to grossly exceed what
the business genuinely plans to sell.
Function - in the context of an organization,
this means the job role or discipline, eg., sales, marketing, production,
accounting, customer service, delivery, installation, technical service,
general management, etc.
Gestation period - sale gestation period typically
refers to the the time from enquiry to sale, the Sales Cycle in other
words, (see Sales Cycle). Aawareness and monitoring of Sale Gestation
Period/Sales Cycle times are crucial in sales planning, forecasting and
management, for individuals sales teams and sales organizations.
Influencer - a person in the prospect organization
who has the power to influence and persuade a decision-maker. Influencers
will be generally be decision-makers for relatively low value sales. There
is usually more than one influencer in any prospect organization relevant
to a particular sale, and large organizations will have definitely have
several influencers. It is usually important to sell to influencers as
well as decision-makers in the same organization. Selling to large organizations
almost certainly demands that the sales person does this. The role and
power of influencers in any organization largely depends on the culture
and politics of the organization, and particularly the management style
of the two main decision-makers. See decision-makers.
Intangible - in a selling context this describes,
or is, an aspect of the product or service offering that has a value but
is difficult to see or quantify (for instance, peace-of-mind, reliability,
consistency). See tangible.
Introduction - first stage of the actual sales
call.
Lead-time - time between order and delivery,
installation or commencement of a product or service.
Lead generation - an essential business process
to consistently acquire long-term, quality clients through the design,
production, and placement of media messages through optimal media channels.
See
Lead Generation Books.
Listening - a key selling skill, in that without
good listening skills the process of questioning is rendered totally pointless.
Major account - a large and complex prospect
or customer, often having several branches or sites, and generally requiring
contacts and relationships between various functions in the supplier and
customer organization. Often major accounts are the responsibility of
designated experienced and senior sales people, which might be formed
into a major accounts team. Major accounts often enjoy better discounts
and terms than other customers because of purchasing power leveraged by
bigger volumes, and lower selling costs from economies of scale.
Marketing - perceived by lots of business people
to mean simply promotion and advertising, the term marketing actually
covers everything from company culture and positioning, through market
research, new business/product development, advertising and promotion,
PR (public/press relations), and arguably all of the sales functions as
well. It's the process by which a company decides what it will sell, to
whom, when and how, and then does it.
Margin / profit margin - the difference between
cost (including or excluding operating overheads) and selling price of
a product or service. Percentage margin is generally deemed to be the
difference between cost and selling price, divided by the selling price
ex tax (eg something that costs $1 and is sold for $2 plus tax produces
a 50% margin - gross margin that is - net margin is after overheads are
deducted).
Mark-up - this is the money that a selling
company adds to the cost of a product or service in order to produce a
required level of profit. Strictly speaking, percentage mark-up refers
to the difference between cost and selling price as a factor of the cost,
not of the selling price. So a product costing €1 and selling for
€2 has been given a mark-up of 100%; (at the same time it produces
a margin of 50%).
Needs-creation selling - a selling style popularised
in the 1970's and 80's which asserted that sales people could create needs
in a prospect for their products or services even if no needs were apparent,
obvious or even existed. The method was for the sales person to question
the prospect to identify, discover (and suggest) organizational problems
or potential problems that would then create a need for the product. I'm
bound to point out that this is no substitute for good research and proper
targeting of prospects who have use of the products and services being
sold.
Negotiation / negotiating - the trading of
concessions including price reductions, between supplier and customer,
in an attempt to shape a supply contract (sale in other words) so that
it is acceptable to both supplier and customer. Negotiations can last
a few minutes or even a few years, although generally it's down to one
or two meetings and one or two exchanges of correspondence. Ideally, from
the seller's point of view, negotiation must only commence when the sale
has been agreed in principle, and conditionally upon satisfactory negotiation.
However most sales people fall into the trap set by most buyers - intentionally
or otherwise - of starting to negotiate before the selling process have
even commenced. See
Negociation Books.
Objection - a point of resistance raised by
a prospect, usually price ("it's too expensive"), but can be anything
at any stage of the selling process; overcoming objections is a revered
and much-trained skill in the traditional selling process.
Open / opening - the first stage of the actual
sales call (typically after preparation in the Seven Steps of the Sale).
Also called the introduction.
Opening benefit statement/OBS - traditionally
an initial impact statement for sales people to use at first contact with
prospect, in writing, on the phone or face-to-face - the OBS generally
encapsulates the likely strongest organizational benefit typically (or
supposedly) derived by customers in the prospect's sector, eg., "Our customers
in the clothing retail sector generally achieve 30-50% pilferage reduction
when they install one of our Crooknabber security systems..." - N.B. The
OBS is a relatively blunt instrument for modern selling - use it with
extreme care for fear of looking like a total twerp.
Open plan selling - a modern form of selling,
heavily dependent on the sales person understanding and interpreting the
prospect's organizational and personal needs, issues, processes, constraints
and strategic aims, which generally extends the selling discussion far
beyond the obvious product application; (in a way, it's rather like combining
selling with genuinely beneficial, free, expert consultancy).
Open question - a question that gains information,
usually beginning with who, what, why, where, when, how, or more subtly
'tell me about..'
Package - in a selling context this is another
term for the product offer; it's the whole product and service offering
at a given price, upon given terms.
Partnership selling - very modern approach
to organizational selling for business-to-business sales. See also
Recommended
Sales Books & Selling Techniques
Perceived - how something is seen or regarded
by someone, usually by the prospect or customer, irrespective of what
is believed or presented by the seller, ie what it really means to the
customer.
Pipeline - see sales pipeline.
Preparation - in the context of the selling
process this is the work done by the sales person to research and plan
the sales approach and/or sales call to a particular prospect or customer.
Almost entirely without exception in the global history of selling, no
call is adequately prepared for, and sales that fail to happen are due
to this failing.
Presentation / sales presentation - the process
by which a sales person explains the product or service to the prospect
(to a single contact or a group), ideally including the product's features,
advantages and benefits, especially those which are relevant to the prospect.
Presentations can be verbal only, but more usually involve the use of
visuals, commonly bullet-point text slides and images on a computer display
or projected onto a screen. Can incorporate a video and/or physical demonstration
of the product(s).
Product - generally a physical item being supplied,
but can also mean or include services and intangibles, in which case product
is used to mean the whole package being supplied.
Product offer - how the product and/or service
is positioned and presented to the prospect or market, which would normally
include features and/or advantages and also imply at least one benefit
for the prospect (hence a single product can be represented by a number
of different product offers, each for different market niches (segments
or customer groupings). One of the great marketing challenges is always
to define a product offer concisely and meaningfully.
Proposal / sales proposal - usually a written
offer with specification, prices, outline terms and conditions, and warranty
arrangements, from a sales person or selling organization to a prospect.
Generally an immensely challenging part of the process to get right, in
that it must be concise yet complete, persuasive yet objective, well specified
yet orientated to the customer's applications. An outline proposal is
often a useful interim step, to avoid wasting a lot of time including
in a full proposal lots of material that the customer really doesn't need.
Proposition - usually means product offer,
can mean sales proposal. The initial proposition means the basis of the
first approach.
Professional selling skills or PSS - highly
structured selling process pioneered by the US Rank Xerox photocopier
sales organization during the 1960's, and adopted by countless business-to-business
sales organizations, normally as the 'Seven
Steps of the Sale', ever since. PSS places a huge reliance on presentation,
overcoming objections and umpteen different closes. Largely now superseded
by more modern 'Open Plan' two-way processes, but PSS is still in use
and being trained, particularly in old-fashioned paternalistic company
cultures. The regimented one-way manipulative style of PSS nowadays leaves
most modern buyers completely cold, but strip it away to the bare process
and it's better than no process at all.
Prospect - a customer (person, organization,
buyer) before the sale is made, ie a prospective customer.
Questioning - the second stage of the sales
call, typically after the opening or introduction in the Seven Steps of
the Sale. A crucial selling skill, and rarely well demonstrated. The correct
timing and use of the important different types of questions are central
to the processes of gathering information, matching needs, and building
rapport and empathy. Questioning also requires that the sales person has
good listening, interpretation and empathic capabilities.
Research / research call - the act of gathering
information about a market or customer, that will help progress or enable
a sales approach. Often seen as a job for telemarketing personnel, but
actually more usefully carried out by sales people, especially where large
prospects are concerned (which should really be the only type of prospects
targeted by modern sales people, given the need to recover very high costs
of sales people).
Retention / customer retention - means simply
keeping customers and not losing them to competitors. Modern companies
realise that it's far more expensive to find new customers than keep existing
ones, and so put sufficient investment into looking after and growing
existing accounts. Less sensible companies find themselves spending a
fortune winning new customers, while they lose more business than they
gain because of poor retention activity. (The hole in the bucket syndrome,
where it leaks out faster than it can be poured in.)
Sales cycle - the Sales Cycle term generally
describes the time and/or process between first contact with the customer
to when the sale is made. Sales Cycle times and processes vary enormously
depending on the company, type of business (product/service), the effectiveness
of the sales process, the market and the particular situation applying
to the customer at the time of the enquiry. The Sales Cycle time is also
referred to as the Sale Gestation Period (ie from conception to birth
- enquiry to sale). The sales cycle in a sweet shop is less than a minute;
in the international aviation sector or civil construction market the
Sales Cycle can be many months or even a few years. A typical Sales Cycle
for a moderately complex product might be:
1. Approach 2. Qualification 3.
Agreement On Need 4. Sell The Company 5. Fill The Need 6.
Act Of Commitment
7. Present proposal and CLOSE sale.
Sales funnel - describes the pattern, plan
or actual achievement of conversion of prospects into sales, pre-enquiry
and then through the sales cycle. So-called because it includes the conversion
ratio at each stage of the sales cycle, which has a funelling effect.
Prospects are said to be fed into the top of the funnel, and converted
sales drop out at the bottom. The extent of conversion success (ie the
tightness of each ratio) reflects the quality of prospects fed into the
top, and the sales skill at each conversion stage. The Sales Funnel is
a very powerful sales planning and sales management tool. See also Books
Selling Techniques.
Sales pipeline - a linear equivalent of the
Sales Funnel principle. Prospects need to be fed into the pipeline in
order to drop out of the other end as sales. The length of the pipeline
is the sales cycle time, which depends on business type, market situation,
and the effectiveness of the sales process.
Sector / market sector - a part of the market
that can be described, categorised and then targeted according to its
own criteria and characteristics; sectors are often described as 'vertical',
meaning an industry type, or 'horizontal', meaning some other grouping
that spans a number of vertical sectors, eg., a geographical grouping,
or a grouping defined by age, or size, etc.
Segment / market segment - a sub-sector or
market niche; basically a grouping that's more narrowly defined and smaller
than a sector; a segment can be a horizontal sub-sector across one or
more vertical sectors.
Solutions selling - a common but loosely-used
description for a more customer-orientated selling method than the Seven
Steps; dependent on identifying needs to which appropriate benefits are
matched in a package or 'solution'. The term is based on the premise that
customers don't buy products or features or benefits - they buy solutions
(to organizational problems). It's a similar approach to the SPIN®
selling process (situation, problem, implication, need), and the whole
idea of needs-creation selling, which first became popular in the 1970's-80's.
Solutions selling remains relevant and its methods can usefully be included
in the open plan selling style described later here.
Steps of sale - describes the structure of
the selling process, particularly the sales call, and what immediately
precedes and follows it. Usually represented as the Seven Steps of the
Sale, but can be five, six, eight or more, depending whose training manual
you're reading.
Strategic selling - open plan selling, in which
seller identifies strategic business aims of the sales prospect or customer
organization, and develops a proposition that enables the aims to be realised.
The proposition is therefore strongly linked to the achievement of strategic
business aims - typically improvements in costs, revenues, margins, overheads,
profit, quality, efficiency, time-saving and competitive strengths areas.
Strong reliance on seller having excellent strategic understanding of
prospect organization and aims, market sector situation and trends, and
access to strategic decision-makers and influencers. See also Books
Selling Techniques.
Tangible - in a selling context this describes,
or is, an aspect of the product or service offering that can readily be
seen and measured in terms of cost and value (eg., any physical feature
of the product; spare parts; delivery or installation; a regular service
visit; a warranty agreement).
Target / sales target - in a sales context
this is the issued (or ideally agreed) level of sales performance for
a sales person or team or department over a given period. Bonus payments,
sales commissions, pay reviews, job gradings, life and death, etc., can
all be dependent on sales staff meeting sales targets, so all in all sales
targets are quite sensitive things. Targets are established at the beginning
of the trading year, and then reinforced with a system of regular forecasting
and reviews (sometimes referred to as 'a good bollocking') throughout
the year. See forecasting.
Telemarketing - any pre-sales activity conducted
by telephone, usually by specially trained telemarketing personnel - for
instance, research, appointment-making, product promotion.
Telesales - selling by telephone contact alone,
normally a sales function in its own right, ie., utilising specially trained
telesales personnel; used typically where low order values prevent the
use of expensive field-based sales people, and a recognisable product
or service allows the process to succeed.
Tender - a very structured formal proposal
in response to the issue of an invitation to tender for the supply of
a product or service to a large organization or government department.
Tenders require certain qualifying criteria to be met first by the tendering
organization, which in itself can constitute several weeks or months work
by lots of different staff. Tenders must adhere to strict submission deadlines,
contract terms, specifications and even the presentation of the tender
itself, and usually only suppliers experienced in winning and fulfilling
this type of highly controlled supply ever win the business. It is not
unknown for very successful tendering companies to actually help the customer
formulate the tender specification, which explains why it's so difficult
to prise the business away from them.
Territory - the geographical area of responsibility
of a sales
person or a team or a sales organization.
Territory planning - the process of planning
optimum and most cost-effective coverage (particularly for making appointments
or personal calling) of a sales territory by the available sales resources,
given prospect numbers, density, buying patterns, etc., even if one territory
by one sales person; for one person this used to be called journey planning,
and was often based on a four or six day cycle, so as to avoid always
missing prospects who might never be available on one particular day of
the week.
Trial close - the technique by which a sales
person tests the prospect's readiness to buy, traditionally employed in
response to a buying signal. If you see a buying signal there's no need
to jump on it - just answer it politely, and before ask why the question
is important, which will be far more constructive.
Unique/uniqueness - a feature that is peculiar
to a product or service or supplier - no competitor can offer it.
Unique Perceived Benefit / UPB - now one of
the central strongest mechanisms in the modern selling process, an extension
and refinement of the product offer, based on detailed understanding of
the prospect's personal and organizational needs.
Unique Selling Poing / USP - or proposition
- this is what makes the product offer competitively strong and without
direct comparison; generally the most valuable unique advantage of a product
or service, for the market or prospect in question; now superseded by
UPB.
Variable - an aspect of the sale or deal that
can be changed in order to better meet the needs of the seller and/or
the buyer. Typical variables are price, quantity, lead-time, payment terms,
technical factors, styling factors, spare parts, back-up and breakdown
service, routine maintenance, installation, delivery, warranty. Variables
may be real or perceived, and often the perceived ones are the most significant
in any negotiation.
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