copyright © 2010 pearson education, inc. publishing as prentice hall chapter 6 creating product...

Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall

CH

AP

TE

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6Creating Product

Solutions

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Learning ObjectivesLearning Objectives

• Explain the importance of developing a product strategy

• Describe product configuration

• Identify reasons why salespeople and customers benefit from thorough product knowledge


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Learning ObjectivesLearning Objectives

• Discuss the most important kinds of product and company information that salespeople use in creating product solutions

• Describe how knowledge of competition improves personal selling

• List major sources of product information


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Product Strategy DefinedProduct Strategy Defined

“The product strategy is a well-conceived plan that emphasizes becoming a product expert, selling benefits, and configuring value-added solutions.”


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Strategic/ConsultativeStrategic/ConsultativeSelling ModelSelling Model


FIGURE 6.1

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Selling SolutionsSelling Solutions

• Are mutually shared answers to recognized customer problems

• Are more encompassing than specific products

• Provide measurable results

• Require a greater effort to define and diagnose the customer’s problems


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Tailoring the Product StrategyTailoring the Product Strategy

Transactional Buyers Consultative Strategic Alliance

Standard or generic items

Hidden features High cost importance

Understand their own product needs

Differentiated choices Limited substitutability

Product can be easily substituted

Customizable


The product strategy should be tailored to the customer’s buying needs:

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BUSCHBUSCH


See theWebsite

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Explosion of Product OptionsExplosion of Product Options

• Domestic and global markets overflowing

• More than 30,000 consumer products are turned out each year

• The good news is: buyers have a choice

• The bad news is: with more choices, buying process is more complicated


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Product ConfigurationProduct Configuration

• Product selection process is often referred to as “product configuration”

• Product configuration software• Develops customized product solutions

quickly and accurately• Incorporates customer selection criteria• Identifies options, pricing, delivery schedules• Can integrate with Customer Relationship

Management applications


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Written ProposalsWritten Proposals

• Many clients ask for written proposals and some provide detailed guidelines

• Most written proposals include:• Budget and overview• Objective• Strategy• Schedule• Rationale


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Becoming a Product ExpertBecoming a Product Expert

• Product development and quality improvement processes

• Performance data and specifications

• Maintenance and service contracts

• Price and delivery



Product Development and Product Development and Quality ImprovementQuality Improvement

Development• Be familiar with

product history• Know stages of

product testing• Link key features

and customer needs

Quality• Quality control

involves measuring against standards

• Extensive sales-force training is key element of quality control

6-13

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Performance Data and Performance Data and SpecificationsSpecifications

• Most clients are interested in product performance and specifications

• Salespeople must be prepared to answer performance-related questions

• Data often critical when customer compares various products


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Sea Ray Boats: Sea Ray Boats: Maintaining high levels of qualityMaintaining high levels of quality


See theWebsite

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Maintenance and Service Maintenance and Service ContractsContracts

• Provide service-related information in proposal and/or at the time of sale

• Understand customer’s service and maintenance requirements

• Customized service agreements add value


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Price and DeliveryPrice and Delivery

• Clients expect salespeople to be well-versed in price and delivery policies

• Giving salespeople price and delivery decision power yields strong position

• Price objections often common barrier to closing the sale


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Quantifying the SolutionQuantifying the Solution

• Process of determining if proposal adds value

• Conduct a cost-benefit analysis using costs and anticipated savings• See Table 6.1 for an example (next slide)

• Calculate a return on investment• Key decision makers respond favorably to ROI


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Cost-Benefit AnalysisCost-Benefit Analysis


TABLE 6.1

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Know Your CompanyKnow Your Company

• Salespeople sell their company as much or more than they sell a product

• Organizational culture is a collection of beliefs, behaviors, and work patterns common to a firm’s employees

• Many prospects use a firm’s past performance as index for current products/services


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GEAR for SportsGEAR for Sports


See the Website

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UPS, Inc.UPS, Inc.

See the Website

“The strategies change and the purpose changes, but the values never change.”

Michael L. Eskew, chairman and CEO, UPS, Inc.


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Know Your CompetitionKnow Your Competition

• Acquiring knowledge of the competition is an important step

• Knowing strengths and weaknesses of competing products allows you to emphasize your benefits

• Prospects do raise questions about competition—be prepared to answer


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Your Attitude Toward Your Attitude Toward Your CompetitionYour Competition

• Avoid referring to the competition during sales presentations

• Never discuss the competition unless you have your facts straight

• Never criticize the competition

• Be prepared to add value


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Be an Industry ExpertBe an Industry Expert

• Salespeople need to become an expert in the industry they represent

• Need to move beyond product specialist to business analyst

• Knowledge of industry must be both current and detailed


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Industry Expertise:Industry Expertise:It’s Never Too EarlyIt’s Never Too Early

• Process often starts in college experience

• Read trade journals

• Regularly attend industryseminars and conventions

• Become active in industryassociations


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Sources of Product InformationSources of Product Information

• Product literature, catalogs, web-based sources

• Plant tours

• Internal sales and sales support team

• Customers

• The product itself

• Trade and technical publications


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Benefits Not FeaturesBenefits Not Features

“I don’t think that we understood our real goal when we first started Federal Express. We thought that we were selling the transportation of goods; in fact, we were selling peace of mind.”— Frederick Smith, founder of FedEx


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Features and BenefitsFeatures and Benefits

• A feature is data, facts, or characteristics of your product or service

• A benefit is whatever provides the customer with a personal advantageor gain• General benefits• Specific benefits


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Adding Value with a Feature:Adding Value with a Feature:Benefit StrategyBenefit Strategy

• Successful sales presentations translate product features into benefits that meet a specific need

• Only when a product feature is converted into a buyer benefit does it make an impact


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Adding Value with a Feature:Adding Value with a Feature:Benefit StrategyBenefit Strategy

• Distinguish between features and benefits

• Use bridge statements• Statements that connect features to benefits

• Identify features and benefits

• Avoid information overload


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Key Concept Key Concept

Discussion QuestionsDiscussion Questions

• Explain the importance of developing a product strategy

• Describe product configuration

• Identify why salespeople and customers benefit from thorough product knowledge

• Discuss the most important kinds of product and company information needed to create product solutions


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Key ConceptKey ConceptDiscussion Questions Discussion Questions

• Describe how knowledge of competition improves personal selling

• List major sources of product information

• Explain how to add value with a feature-benefit strategy


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Copyright © 2010 Pearson Education, Inc. Copyright © 2010 Pearson Education, Inc. Publishing as Prentice HallPublishing as Prentice Hall

copyright © 2010 pearson education, inc. publishing as prentice hall chapter 6 creating product...

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