Theories and Models of Selling
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The document discusses various models and theories of selling, including the AIDAS theory, 'right set of circumstances' theory, 'buying formula' theory, and 'behavioral equation' theory, emphasizing both buyer and seller perspectives. It introduces the SPIN selling model, which is customer-centric and involves four types of questions to understand buyer needs effectively. Overall, the theories highlight the importance of adapting the selling process based on buyer behavior and circumstances.
Theories and Models of Selling
- 1. Models and Theories of Selling Presented by: JATIN VAID
- 2. Selling theories Is selling a science, taught through concepts or an art, learned through experience Experience psychology V/S Behavioral science Explain the ‘Buyer – Seller’ process Seller orientation or Buyer orientation or Both? jatinvaid@gmail.com
- 3. Types of Selling Theories 1. AIDAS Theory 2. “Right Set of Circumstances” Theory 3. “Buying Formula” Theory 4. “Behavioral Equation” Theory jatinvaid@gmail.com
- 4. 1. AIDAS Theory Buyers’ mind passes through 5 stages consciously – Attention, Interest, Desire, Action, Satisfaction i. Securing Attention: Good rapport, conversation openers, first impression, attire, smile, social skills ii. Gaining Interest: Visual aids, effective selling appeal, asking questions, brochures, handing over product to customer iii. Kindling Desire: Ready to buy point, Handling objections, summarizing, focus iv. Inducing actions: Sense timing for trial close, asking for orders, reassuring v. Building Satisfaction: Thank customer, reassuring decision, written order, following up promises made jatinvaid@gmail.com
- 5. 2. “Right Set of Circumstances” Theory Also called, ‘Situation – Response’ Theory Particular circumstances prevailing in a given selling situation will cause the prospect to respond in a particular way External & internal stimuli Fails to assign importance to external factors (response) Salesperson should control the situation to sell effectively Difficult to apply jatinvaid@gmail.com
- 6. 3. “Buying Formula” Theory Emphasizes the buyer’s perspective (thought process) to buy or not to buy Buyer’s needs receive major attention & seller’s role is to help buyer find solution. Buying formula is based on a theory by E.K Strong and arranges responses in a psychological sequence jatinvaid@gmail.com
- 7. Buying formula Need Product (And / Or) Brand Name Purchase Satisfaction jatinvaid@gmail.com
- 8. 4. “Behavioral Equation” Theory J.A Howard Explains buying behavior in terms of purchasing decision process as a learning process Elements: i. Drive: Strong internal stimuli (Innate or learned) ii. Cues: Weak stimuli that determines when buyer will buy (Price, advertisement) iii. Response: What buyer does iv. Reinforcement: An event that strengthens the buyer’s tendency to respond jatinvaid@gmail.com
- 9. Behavioral equation B = P X D X K X V Where, B: Buying P: Predisposition D: Drive level K: Incentive potential V: Intensity of all cues jatinvaid@gmail.com
- 10. SPIN Model of Selling By, Neil Rackham (1988) Underlying assumptions: i. Relationship selling is customer centric ii. Selling process adapted to customers to deliver personal solutions iii. Ask relevant questions iv. Four kinds of questions: Situation, Problem, Implication, Need-payoff (SPIN) jatinvaid@gmail.com
- 11. Steps of SPIN Selling 1. Opening: Builds rapport & establish a buyer – centered purpose for sale call 2. Investigation: Heart of SPIN Model – to ask relevant questions to uncover buyer’s needs (Situation, Problem, Implication & Need – payoff) 3. Demonstrating capability: Explain the benefits of solution and show how the product meets the prospect’s needs 4. Obtaining commitment: To make the prospect agree to advance the sale or make a purchase jatinvaid@gmail.com
- 12. i. Situation Questions Straightforward facts about the buyer’s existing situation & provide a starting place for understanding buyer’s needs To be asked sparingly to avoid monotony Based on careful research about customer jatinvaid@gmail.com
- 13. ii. Problem Questions Helps customers recognize their needs & paves way to propose a solution Helps better understanding of customer’s problem jatinvaid@gmail.com
- 14. iii. Implication Questions Increase a prospect’s motivation to seek change. Uncover the causes of the problem & its long term consequences Effective when prospect is the decision maker jatinvaid@gmail.com
- 15. iv. Need-payoff Questions Helps customers to discover a way out by asking how their problem could be resolved Right ‘Need-payoff’ questions can tell seller how his solutions can help the customer Highly convincing jatinvaid@gmail.com