Sales is one of the key skills and activities of any business. Without sales, as you know, the business ceases to exist.
Everybody has their own way of doing things and handling new prospects and returning customers. Unfortunately, sales people tend to have a negative reputation that has -- in large part -- been earned by professionals who have been trained in a different way, or worse yet, haven't been trained at all.
The stereotypical "sales professional" is often seen to be a supreme manipulator with no scruples. You know, kind of a badly dressed, cartoonish fellow, trying to scam you at a used car lot. Retail sales at a brick-and-mortar storefront tend to make sales professionals focus on creating a positive buying experience for customers. In large part, this is because retailers generally understand the lifetime value of a single customer. What does lifetime value mean? There are a lot of pearls of wisdom in business about customers, but the main reasons why businesses appreciate the lifetime sales value of a customer are as follows:
- It's easier to sell to a customer you already have.
- The cost is lower to keep an existing customer than it is to find a new customer.
- Each customer engagement is an investment by the business in the customer.
- Every sale increases the relationship between the customer and the business.
- Experienced customers can be a key strategic resource in new product planning.
- And the list goes on, limited only by business needs.
Let's look at the objective of selling. At first glance it would seem that the primary goal is to get money for something. However, in the larger picture of maximizing the lifetime value of customers, there must always be multiple simultaneous goals -- to derive a steady stream of cash from customers in the short term to keep the business solvent, and to strengthen the relationship with the customers so that they continue to prefer buying from you and your business.
Sales people are often the only professionals in an organization who are paid completely or partially though commissions. Some business managers take a hardline attitude towards sales professionals and only pay for results. This approach can work for companies with a stable and predictable product line or line card. A good sales professional can quite accurately predict which prospect will be a customer and when, and they have a grasp of where their prospects are in the selling cycle.
The sales process is where miscues can easily happen. There are a number of models of the selling process. Sometimes it's referred to as a "sales funnel," but the essence is how you find prospects and move them through the sales process. From the seller's viewpoint, the process has often been characterized as having eight steps, as follows:
- Prospecting/initial contact
- Pre-approach -- planning the sale
- Needs assessment
- Meeting objections
- Gaining commitment
In larger companies, this step-wise approach to getting sales can identify areas that are an impediment to sales, and ultimately lead to the ability to predict sales number based solely on initial interest. But this process doesn't explicitly try to maximize the seller's return on investment through repeated sales. Perhaps just as important, this classic sales process fails to incorporate promotion (or anti-promotion) of the company and its products through social media and word-of-mouth "advertising."
Sales forces have been managed for more than 20 years according to the "guiding principles" of the classic sales process. Some companies offer bonuses for new design wins, new applications, or winning a competitive bid. No matter what the commission plan, many sales people are led to take actions that are suboptimal when viewed from an engineering perspective.
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