Positioning involves those decisions and activities intended to create and maintain certain concepts of the firm’s product in the customer’s mind.  Differentiation refers to your ability to separate yourself and your product from that of your competitors.  It is key to building and maintaining a competitive advantage.  A value proposition is the set of benefits and values the company promises to deliver to a customer need that must be satisfied.

The Cluster of Satisfaction Concern

  • Products are problem-solving tools
  • People buy products if they fulfill a problem-solving need
  • Today’s better educated and more demanding customers are seeking a cluster of satisfactions

Product Positioning Options

  • Applies to both new and existing products
  • May be necessary to reposition products several times
  • Salespeople have an important and expanding role in differentiating products
  • Direct and personalized form of communication must be used
  • Mass Advertising often fails to position a complex product
  • Position new versus established products
  • Position with price strategies
  • Position with value added

New Product Development (50/50 chance of success failure)

Sales become key and distribution crucial.  A price class defines a Market

Value-added product-selling strategy is enhanced when based on a comprehensive analysis of the competitive situation including product, its attributes, and the benefits it offers.  Ideal Inventory turn is 52 times a year-once a week.  26 times a year is good

Product Life Cycle Stages

Target Rated Points (T.R.P.) are how many times targeted market sees various ads and promotions.  Anything over a 100 week is pretty good.  Every company that has a product or service

Every market has a product life cycle and category development

New Emerging Products

  • Develop new levels of expectations
  • Change habits
  • Establish new standards
  • Build desire for product
  • Focus on creating new markets

Mature and Well-established Products

  • Emphasize Brand Superiority
  • Emphasize Company Superiority
  • Point out unique features
  • Provide Outstanding customer service
  • Focus on sustaining existing market share

Selling Products with a Price Strategy

  • Pricing decisions must be made at each stage of the life cycle
  • Setting price can be a complex process
  • First step is to determine pricing objectives
  • Some firms set prices to maximize profits
  • Others set a market share objective
  • Pricing strategies reflect a products position in the market place
  • Price according to market and Franchise

Consequences of Low Price Tactics

  • High/low involvement buyers?
  • High emotional involvement with brand: New Task and Modified Re-buy
  • Low-involvement buyers focus on price: Rebuy
  • Importance of quality?
  • Role of price-quality relationship in sale
  • Importance of service?
  • Many buyers particularly b2b, ranks service above absolute price
  • C.L.V.-Customer Lifetime Value

How do we add value? Information sharing and Guarantee Warranty

Value Creation Investments for….

  • Transactional Buyers-involves emphasis on eliminating costs, avoiding delays
  • Consultative Buyers-Involves custom-tailored solutions to deliver more real benefits
  • Strategic Alliance Buyers-requires leveraging the full assets of the company; investments go well beyond the sales force

Customer Strategy is defined as a carefully conceived plan that result in maximum customer responsiveness.  One major dimension of this strategy is to achieve a better understanding of the customer’s buying needs and motives

Develop a customer strategy by understanding the buying process, understanding buyer behavior, and developing a prospect base.

Organizational Buying

  • New Task Buy: Salespeople rely on consultative selling skills
  • Straight Rebuy: Salespeople constantly

Consumer Buying

  • Habitual buying situations
  • Variety-seeking buying situations
  • Complex buying situations

Achieving Alignment

  • Buying process is a systematic series of actions, or a series of defined repeatable steps intended, to achieve a result
  • Salespeople need to be clean on how decisions are being made
  • Acquire specific information rather

Buyer Resolution Theory

Why should I buy?

What should I buy?

Where should I buy?

What is a fair price?

When should I buy?

Customer Strategy Model Figure 8.5

Basic Needs Maslow

  • Physiological: food, shelter
  • Security: free from danger
  • Social: Identification with social groups, friendship
  • Esteem: Desire to feel worthy in eyes of others
  • Self-Actualization: Need for mastery, self-fulfillment

Group Influences Figure 8.7

Buying Motives

  • A buying motive is an aroused need, drive, or desire that stimulates behavior to satisfy the aroused need
  • It’s helpful to discover the DMB (Dominant Buying Motive)
  • Four basic motive types-emotional, rational, patronage, and product

Emotional Motives are acts due to passion or sentiment.  Emotional appeals are common too.  If two products are identical, the salesperson that “connects” has the advantage.

Rational Motives are acts on reason or judgment.  It is relatively free or emotion.  Salespeople gather, interpret, and disseminate customer-specific information

Patronage and Product Motives


  • Buy from a particular firm
  • Past experience positive
  • Relevant elements superior service, product selection, competent sales stuff


Buyer believes one product is superior to others.  Preferences for specific brands, quality, price, design engineering

Prospect, Prosperity, and Prospect Base

A prospect is a potential customer that meets the qualification criteria established by your company.  Prospecting is identifying potential customers.  A Prospect Base is made up of current customers and potential customers.  Use the What if? Analysis and 20:80 Rule.  Always have a group of people that can be promoting the importance of prospecting.  Every Salesperson must cope with customer attrition:

  • Customer may have a one-time need
  • Customer may move outside the salesperson’s territory
  • Firm may go out of business or merge
  • Sales may be lost to the competition

Grad’s Ferris Wheel-Supply

Prospecting Requires Planning

  • Increase number of people who board Ferris Wheel
  • Improves the quality of prospects
  • Shorten sales cycle by determining which prospects are “qualified”
  • Prospecting plans must be monitored continuously for effectiveness


  • Prospect recommend by current satisfied customer or one familiar with product or service
  • Endless chain: ask contact who else could benefit from product
  • Referral Organizations: Facilitate networking
  • Friends, family members, centers of influence: A person who may influence on opinion leaders

Lead Generation, Decreased Directories, Trade Shows/Publications, Telemarketing, Direct Response and letter, website, cold calling, networking, computerized databases

Qualifying Prospects

  • Does prospect need my product?
  • Does the prospect have the authority to buy my product?
  • Does the prospect have the financial resources to buy my product?
  • Does the prospect have the willingness to buy my product?

Collecting and Organizing Prosper Information

Sales Data Can be collected and organized into C.R.M. systems such as, Oracle, NetSuite, and Microsoft.

Prospecting and Sales Forecasting Plans

Important to balance time and organize contacts:

  • Prepare a list of prospects
  • Forecast Potential Sales Volume for each new account, by product
  • Carefully plan the sales route to minimize time and cost


Common Types of Sales Goals

  • Financial-Current Compensation
  • Career Advancement
  • Personal Developments-MBA
  • Sales Volume
  • Sales Call Activity
  • Sales Call Expense and ethics
  • Profitability

Market Share

Share of Account

  • Ancillary Activity-community
  • Customer Retention (70:80)
  • New Account Generation
  • Customer Service-Complaints
  • Conversion

Pricing-Elasticity (Change in Market to Market)

Consumer Products: Hormel, P.G., E.J. Gallo, Pharmacist=at execution end of manifesto plan

Retail Price Point.  Always protect price point

Strategic Planning Sets The Stage

Benefits of Demonstration

  • Improved Communication and retention
  • Proof of Buyer Benefits-Proof Devices
  • Feeling of Ownership
  • Quantifying the Solution
  • Value Proposition Revisal

Creative Demonstrators

  • Make features and Benefits Appealing
  • Must gain attention and increase desire for product
  • Create different ways at looking at problems and solve

Customize the Demonstration

  • Use custom-fitted demonstrations
  • Relate to specific customer needs

Choose Right Setting

  • Demonstration location makes difference
  • Control Environments free from distraction
  • Rehearse, Rehearse, Rehearse
  • If you don’t rehearse you cant succeed

Decision Analysis Process

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