Personal Selling: Chapter 13

After the Sale
Building Long Term
Partnerships
Chapter 13

Important Questions Answered
 How important is service after the sale?

 How should salespeople stay in contact with
customers?

 Which sales strategies stimulate repeat sales and
new business in current accounts?

 Which techniques are important to use when
handling complaints?
2

THE VALUE OF CUSTOMERS
Many people believe the emphasis in selling is on getting
the initial sale. For most salespeople, however, sales
increases from one year to the next are due to increasing the
revenue from existing accounts, not from getting new
accounts. Salespeople gain a competitive advantage by
maintaining strong relationships with their customers.
Eventually, when buying decisions need to be made, those
customers look to people they know. Customers are, of
course, the primary revenue source for companies. Many
people do not fully understand the value of a customer.
Customers are also worth more in terms of revenue than
some salespeople recognize. (contd.)

3

THE VALUE OF CUSTOMERS
Successfully retaining customers is important to all
companies. One study reported that 65 percent of the
average company's business comes from current, satisfied
customers. Another study found the cost of acquiring a new
customer to be five times the cost of properly servicing a
current customer and retaining that customer's business. Ye
another study indicated that overall, customers are less
satisfied than ever, so apparently many companies have
failed to recognize the importance of customer satisfaction.
Those industries that are losing customers as rapidly as they
are finding new ones, now recognize the value of retaining
customers.

4

Stages of Partnerships
Commitment

Dissolution

•Limited
Relationships
•Failure to
monitor
Competitors or
industry
•Complacency

5

EXPLORATION
In the exploration stage, the relationship is defined
through the development of expectations for each
party. The buyer tests the seller's product, how the
seller responds to requests, and other similar actions
after the initial sale is made. A small percentage of
the buyer's business is given to minimize the risk in
case the vendor cannot perform. When the vendor
performs well, trust is developed, as is a personal
relationship. An unfavorable initial experience with
the product or with the company may be extremely
difficult to overcome.

6

Activities of Exploration Stage
► SET THE RIGHT EXPECTATIONS

► MONITOR ORDER PROCESSING

► ENSURE PROPER INITIAL USE OF THE
PRODUCT OR SERVICE

► FOLLOW UP

► MAKE PERSONAL VISITS

► HANDLE CUSTOMER COMPLAINTS
7
►

SET THE RIGHT
EXPECTATIONS
The best way to begin a relationship is for each party to be
aware of what the other expects. To a large degree,
customers base their expectations on sales presentations.
Salespeople should make sure customers have reasonable
expectations of product performance. If the salesperson
exaggerates the capabilities of the product or the
company, the customer will be disappointed. Avoiding
complaints by setting proper expectations is best. Long-
term relationships are begun by making an honest
presentation of the product's capabilities and eliminating
any misconceptions before the order is placed.

8

MONITOR ORDER PROCESSING
Although many people may work on an order before it is
shipped, the salesperson is ultimately responsible, at least in
the eyes of the customer, for seeing that the product is
shipped when promised. Salespeople should keep track of
impending orders and inform buyers when the paperwork is
delayed in the customer's plant. Orders placed directly with
a salesperson should be transmitted to the factory
immediately. Also, progress on orders in process should be
closely monitored. If problems arise in filling the order, the
customer should be informed promptly; on the other hand, if
the order can be filled sooner than promised. Monitoring
order processing is critical to developing a partnership

9

ENSURE PROPER INITIAL USE
OF THE PRODUCT OR SERVICE
Customer dissatisfaction can occur just after delivery
of a new product, especially, if the product is
technical or requires special installation. Customers
unfamiliar with the product may have problems
installing or using it. They may even damage the
product through improper use. Many salespeople
visit new customers right after initial deliveries to
ensure the correct use of the product. In this way
they can also help the customer realize the full
potential benefits of the product. It is still the
salesperson's responsibility, however, to make sure
that the customer service department takes proper
care of each new customer.
10

FOLLOW UP
The first follow up a salesperson should do after the sale is
a call to say thank you and to check to see that the
product is working appropriately. Some salespeople use
specialty advertising, or gifts imprinted with their
company's name, to say thanks. But salespeople should
also follow up regularly with their accounts to stay in
touch with any changing needs or possible problems. In
fact, failing to follow up is a major complaint that buyers
have about salespeople. Regular follow up can be
accomplished via
► Make personal visit
► Telephone
► Mail

11

MAKE PERSONAL VISITS
Personal visits can be the most expensive form of follow-
up because of the time it takes to travel and because the
sales call will last longer than one conducted through
other means. A personal visit, though, can be extremely
productive because the salesperson can check on
inventories or the performance of the machine or other
aspects that can be accomplished only at the customer's
site. Plus, a customer may be more likely to disclose
more information, such as a minor complaint or
compliment, in a personal setting than over the phone.
Regular personal visits can also build trust, a key
component needed to move the relationship forward.

12

TELEPHONE
Between personal visits, it is often a good idea to
make contact via telephone. A salesperson can make
12 or more such calls within an hour, efficiently
checking on his or her clients. Telephone calls are
two-way communication, giving the customer an
opportunity to voice any concerns.

13

MAIL
Many companies provide form letters or thank-you cards
to encourage their salespeople to follow up on new sales.
E-mail is also becoming a common form of customer
contact, with customers appreciating the opportunity to
choose when to read and respond to the salesperson's
contact. Although the objective may be to create a
functional relationship rather than a strategic
partnership, such follow-up is still necessary to remind
the customer that you are the salesperson with whom
they want to do business.

14

HANDLE CUSTOMER COMPLAINTS
Handling complaints is critical to developing goodwill
and maintaining partnerships. Complaints can occur at
any time in the partnering process, not just during the
exploration stage. Handling complaints properly is
always important, but perhaps even more so in the early
stages of a partnership. Attempts to establish
partnerships often collapse because of shortsightedness
in handling customer complaints. Some firms spend
thousands of dollars on advertising but make the mistake
of insulting customers who attempt to secure a
satisfactory adjustment.

15

Reasons For Dissatisfaction
Customers can be disappointed for any of the
following reasons
► The producer performs poorly

► It is being used improperly

► The terms of the sales contract were not met.

Although salespeople usually cannot change the
product or terms, they can affect these sources of
complaints.

16

Techniques for responding to
complaints

► ENCOURAGE BUYERES TO TELL THEIR
STORY

► DETERMINE THE FACTS

► OFFER A SOLUTION

► FOLLOW THROUGH WITH ACTION
17

ENCOURAGE BUYERES TO
TELL THEIR STORY
Customers need to tell their stories without interruption.
Customers want a sympathetic reaction to their problems,
whether real or imagined. They want their feelings to be
acknowledged, their business to be recognized as
important, and their grievances handled in a friendly
manner. Good salespeople show they are happy the
grievance has been brought to their attention. The
salesperson may express regret for any inconvenience.
Agreeing with the customer as far as possible gets the
process off to the right start.

18

DETERMINE THE FACTS
Whenever possible, the salesperson should examine, in
the presence of the customer, the product claimed to be
defective. Encouraging the customer to pinpoint the
exact problem is a good idea. The purpose of getting the
facts is to determine the cause of the problem so that the
proper solution can be provided. Experienced
salespeople soon learn that products may appear
defective when actually nothing is wrong with them. On
the other hand, salespeople should not assume product
or service failure is always the user's fault. They need an
open mind to search for the facts in each case.

19

OFFER A SOLUTION
The next step is to offer a solution. At this time the
company representative describes the process by which
the company will resolve the complaint, and the rep
should then gain agreement that the proposed solution
is satisfactory. Company policies vary, but many assign
the responsibility for settling claims to the salesperson.
Other companies require the salesperson to investigate
claims recommend a settlement to the home office.
Whatever the company policy, the customer desires
quick action and fair treatment and wants to know the
reasons for the action.
.
20

Possible Settlements
► Replace the product without cost to the customer.
► Replace the product and charge the customer for labor
or transportation costs only.
► Replace the product and share all costs with the
customer.
► Replace the product but require the customer to pay
part of the cost of the new product.
► Instruct the customer on how to proceed with a claim
against a third party.
► Send the product to the factory for a decision.

21

FOLLOW THROUGH WITH
ACTION
The salesperson who has authority only to recommend an
adjustment must take care to report the facts of the case
promptly and accurately to the home or branch office. The
salesperson has the responsibility to act as a buffer between
the customer and the company. After the claim is filed,
contact must be maintained with the customer to see that
the customer secures the promised settlement. The
salesperson also has a responsibility to educate the
customer to forestall future claims. After a settlement to the
customer's satisfaction is a fine time to make some
suggestions.

22

ACHIEVE CUSTOMER
SATISFACTION
Salespeople should continuously monitor customers' levels
of satisfaction and perceptions of product performance
because customer satisfaction is the most important
reason for reordering at this stage in the relationship.
When the customer is satisfied, an opportunity for further
business exists. Complaints and dissatisfaction can occur
at any time during the relationship, but handling
complaints well during the exploration stage is one way to
prove that the salesperson is committed to keeping the
customer's business

23

EXPANSION
The next phase of the buyer-seller relationship is
expansion. When a salesperson does a good job of
identifying and satisfying needs and the
beginnings of a partnership are in place, the
opportunity is ripe for additional sales.

24

Activities of Exploration Stage
The ways to maximize the selling opportunity are
► generating repeat orders

► Upgrading

► Full-line selling

► Cross selling

25

GENERATING REPEAT ORDERS
In some situations the most appropriate strategy is
to generate repeat orders Several methods can be
used to improve the likelihood of reorders.
► BE PRESENT AT BUYING TIME

► HELP TO SERVICE THE PRODUCT

► PROVIDE EXPERT GUIDANCE

► PROVIDE SPECIAL ASSISTANCE

26

BE PRESENT AT BUYING TIME
One important method of ensuring reorders is to
know how often and when the company makes
decisions. Buyers do not always have regular
buying cycles, which can make it difficult for
salespeople to be present at buying time. In these
situations the seller still wants to be present in the
buyer's mind. Two items that can help keep the
seller present are catalogs and specialty advertising
items.

27

HELP TO SERVICE THE PRODUCT
Most products need periodic maintenance and repair, and
some mechanical and electronic products require routine
adjustments. Such service requirements offer salespeople
a chance to show buyers that the seller's interest did not
end with the delivery of the product. Salespeople should
be able to make minor adjustments or take care of minor
repairs. If they cannot put the product back into working
order, they must notify the proper company
representative. They should then check to see that the
repairs have been completed in a timely manner and to
the customer's complete satisfaction.

28

PROVIDE EXPERT GUIDANCE
An industrial buyer or purchasing agent may need help in
choosing a proper grade of oil or in selecting a suitable
floor cleaner. A buyer for a retail store may want help
developing sales promotion ideas. Whether the buyer
needs help in advertising, selling, or managing, good
salespeople are prepared to offer worthwhile suggestions
or services. When you use your industry expertise to
solve problems or develop opportunities for your clients
that do not involve the sale of your product, you add
value to the relationship, which can ultimately help you
expand your business within the account.

29

PROVIDE SPECIAL ASSISTANCE
Salespeople are in a unique position to offer many
types of assistance to the buyer. Providing special
assistance is one hallmark of excellence in selling.
Good relationships are built faster and made more
solid by the salesperson who does a little something
extra for a customer, performing services over and
above his or her normal responsibilities

30

UPGRADING
Upgrading, also called up-selling, is convincing the
customer to use a higher quality product or a newer
product. The salesperson seeks the upgrade because the
new or better product serves the needs of the buyer more
effectively than the old product did. Upgrading is crucial to
companies. When upgrading, it is a good idea to
emphasize during the needs identification phase that the
initial decision was a good one. Now, however, needs or
technology have changed, and the newer product fits the
customer's requirements better. Otherwise, the buyer may
believe that the seller is trying to take advantage of the
relationship to foist off a higher-priced product.

31

FULL-LINE SELLING
Full-line selling is selling the entire line of
associated products. The emphasis in full-line
selling is on helping the buyer realize the synergy
of owning or carrying all of the products in that
line.

32

CROSS-SELLING
Cross-selling is similar to full-line selling except the
additional products sold are not directly associated
with the initial products. Cross-selling involves
leveraging the relationship with a buyer to identify
needs for additional products. Again, trust in the
selling organization and the salesperson already
exist; therefore, the sale should not be as difficult as
it would be with a new customer, provided the needs
exist.

33

Tips for Effective Cross-Selling

34

COMMITMENT
When the buyer-seller relationship has reached the
commitment stage, there is a stated or implied
pledge to continue the relationship. Formally, this
pledge may begin with the seller becoming a
preferred supplier, which is a greater level of
commitment. Although preferred-supplier status may
mean different things in different companies, in
general it means that the supplier is assured of a
large percentage of the buyer's business and will get
the first opportunity to earn new business.

35

SECURING COMMITMENT TO A
PARTNERSHIP
When firms reach the commitment stage, elements in
addition to trust become important. Trust may be
operationalzed in the form of shared risk. Along with
the dimensions of trust such as competence and
dependability and honesty (or ethics), there must be
commitment to the partnership from the entire
supplying organization, a culture that fits with the
buyer's organizational culture, and channels of
communication so open that the seller and buyer
appear to be part of the same company.

36

COMMITMENT MUST BE
COMPLETE
Commitment to the relationship should permeate both
organizations, from top management to the secretary who
answers the phone. This level of commitment means
devoting the resources necessary to satisfy the customer's
needs, even anticipating needs before the buyer does.
Senior management must be convinced of the benefits of
partnering with a specific account and be willing to allow
the salesperson to direct the resources necessary to sustain
the partnership Commitment also requires that all
employees be empowered to handle the needs of the
customer.
37

COMMUNICATION

In the commitment phase of a partnership, the seller
must take a proactive communication stance. This
approach means actively seeking opportunities to
communicate at times other than when the
salesperson has something to sell or the customer
has a problem to resolve. Partners are usually the first
to learn of each other's new products, many times
even co-developing those products. Salespeople
should also encourage direct communication among
similar functional areas.

38

CORPORATE CULTURE
Corporate culture is the values and beliefs held by senior
management. A company's culture shapes the attitudes and
actions of employees and influences the development of
policies and programs. A single salesperson will nor change
a company's corporate culture to secure a partnership with
a buyer, but the salesperson must identify the type of
culture both organizations hold and make an assessment of
fit. Although a perfect match is not necessary, the sales
person must be ready to demonstrate that there is a fit.
Though not attempting to change a company's culture, the
salesperson who seeks a partnering relationship seeks
change for both.

39

THE SALESPERSON AS
CHANGE AGENT
To achieve increasing revenue in an account over
time, the salesperson acts as a change agent, or a
cause of change in the organization. Each sale may
involve some type of change, perhaps a change
from a competitive product or simply a new version
of the old one. Partnering, though, often requires
changes in both the buying and selling
organizations. Change is not easy, even when it is
obviously beneficial.

40

Change and Resistance

41

CHAMPIONS
Champions, also called advocates or internal
salespeople, work for the buying firm in the areas most
affected by the proposed change and work with the
salesperson to make the proposal successful. These
champions can build momentum for the proposal by
selling in arenas or during times that are off limits to
the salesperson. It is also important to recognize that
one change is the change in status from preferred
supplier to strategic partner. Salespeople can help
potential champions by providing them with all of the
knowledge they will need.

42

POSITIONING THE CHANGE
Positioning the change is similar to positioning a
product in mass marketing. In this case, the
salesperson examines the specific needs and wants of
the various constituencies in the account to position
the change for the greatest likelihood of success.
Because salespeople are highly proactive in finding
areas for improvement (or change) in their partners'
organizations, positioning a change may determine
who is involved in the decision.

43

DETERMINING THE
NECESSARY RESOURCES
The customer's needs may be beyond the
salesperson's expertise. The salesperson must
assess the situation and determine what resources
are needed to secure the buyer's commitment. Not
only allocation of personnel is enough, salespeople
must manage other resources as well, such as
travel and entertainment budgets or sample
supplies.

44

DEVELOPING A TIME-BASED
STRATEGY
The salesperson must determine a strategy for the
The salesperson must determine a strategy for the
proposed change and set that strategy against a time line.
This action accomplishes several objectives. First, the
strategy is an outline of planned sales calls, with primary
and minimum call objectives determined for each call.
Second, the time line provides the salesperson with
estimates of when each call should occur. Of course,
objectives and planned times will change depending on
the results of each call, but this type of planning is
necessary to provide the salesperson with guidance for
each call, determine when resources are to be used, and
make sure each call contributes to the visionary objective.

45

Time Line for Strategy

46

CAUSES OF DISSOLUTION
Too often salespeople believe that once a customer has
committed to a partnership less work is needed to
maintain that relationship. That belief, however, is
untrue. One study found that 55 percent of all strategic
partnerships dissolve within 3 to 5 years, and the rest
have a further life expectancy of only 3.5 years.
Salespeople who subscribe to the belief that partnerships
require less work fall victim to one or more common
problems. The final stage for partnerships is dissolution,
or breakup, but this stage can occur at any point, not just
after commitment. Several potential problems, including
maintaining few personal relationships, failing to
monitor competitor actions or the industry, and falling
into complacency, can lead to dissolution.

47

LIMITED PERSONAL
RELATIONSHIPS
Salespeople tend to call on buyers they like; it is natural
to want to spend time with friends. The result is that
relationships are cultivated with only a few individuals
in the account. Unfortunately for such salespeople,
buyers may leave the organization, transfer to an
unrelated area, or simply not participate in some
decisions. Truly effective salespeople attempt to
develop multiple relationships within an account. One
benefit of multiple relationships is that different
champions can be selected for each proposal.

48

FAILING TO MONITOR
COMPETITOR ACTIONS
No matter how strong the partnership is, competition will
want a piece of the business. Accounts are most vulnerable
when a personnel change occurs, when technology changes,
or when major directional changes occur, such as a
company starting a new division or entering a new market.
Monitoring competitor action can be as simple as checking
the visitor's log to see who has dropped by or keeping up
with competitor actions and asking buyers for their
opinions. Monitoring competition also means thinking
about the benefits competitors offer, what their products do,
and what their selling strategies are?

49

FAILING TO MONITOR THE
INDUSTRY
Similar to failing to monitor competition is a failure to
monitor the industry in which either the salesperson
or the customer operates. Salespeople often assume
that the responsibility of monitoring the industry lies
with someone else, either higher-ups in their own
company or with the customer. But salespeople who
fail to monitor both industries stand to miss
opportunities that change creates. How does the
professional salesperson monitor the industry? By
reading trade magazines and by attending trade
shows and conferences.

50

FALLING INTO COMPLACENCY
Perhaps the most common thief of good accounts is
complacency. In sales terms, complacency is assuming
that the business is yours and will always be yours. It is
failing to continue to work as hard to keep the business
as you did initially to earn the business.

51

How To avoid complacency
► Do I understand each individual's personal
characteristics? Do I have these characteristics in my
computer file on each account?
► Do I maintain a written or computerized record of
promises made?
► Do I follow up on every customer request promptly, no
matter how insignificant it may seem?
► Do I follow up on deliveries, make sure initial experiences
are positive, and ensure that all paperwork is done
correctly and quickly?
► . Have I recently found something new that I can do
better than the competition?
52

Personal Selling: Chapter 13

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Personal Selling: Chapter 13