How organizations can leverage commercial success through utilization of the characteristics of modern selling
In the first part of this essay, we conduct an in-depth analysis of how global organizations can leverage commercial success through the utilization of the characteristics of modern selling. This is carried out while supporting each theory with real organization example. Where real organization examples are not available, you hypothesize. In the second part, we select two (2) global organizations with different selling platforms and assess these different sales platforms on the basis of their success, effectiveness and reach.
Characteristics of Modern Selling ESSAY
Key Learning Outcomes
- Understand the characteristics of modern selling
- Use case study organizations to analyze how global organizations can leverage commercial success through the utilization of the characteristics of modern selling
- Point Three
This part of the paper is to analyze how global organizations can leverage commercial success through the utilization of the characteristics of modern selling. The requirements for a salesforce have completely changed as only presentational and closing skills in the highly competitive world are not sufficient and salespeople have to possess a wide range of skills and be able to apply characteristics of modern selling. Nowadays consumers are better educated and more sophisticated. Salaries have increased continuously in the past years and therefore consumers are able to use their spending power to allocate between an increasingly wide range of product and services. Too many companies own a superior product and efficient production and extensive promotion so that they must be able to offer to customers more than this to increase their chance of success, customer needs must be placed at the very center of business planning (Jobber and Lancaster 2015).
1.1 Modern selling characteristics
This chapter describes and analyses the modern selling characteristics that effective salespeople need to understand in order to tackle their jobs.
1.1.1 Customer retention and deletion
In regards to customer retention and deletion, according to the Pareto Principle, companies find that 80 percent of their sales come from 20 percent of their customers. This indicates that it is vital to dedicate the most effort to retaining existing high volume, high potential, and highly profitable customers. (The Pareto Principle)
Customer retention is generally defined as the percentage of long-term clients of a company and it plays a vital role for the company’s success as the loyal clients are likely to spend more as they are already familiar with the product, it reduces advertisement cost and the current customers are a bridge to new potential customers through references that can be found in companies like Booking.com that offers a reward in form of credit if you refer a friend and that might be very motivating for some of the existing customers and therefore brings new business to the organization.
On the other hand, short time clients might purchase product only once and will never buy it again, for example website such as Groupon where companies can offer discounted products or services for a certain period to attract new customers, however, some people just purchase for the low price, but would never pay the full price or return again. According to Bain & Company, it is six to seven times more costly to acquire a new customer than to retain an existing one. That is the main reason why the retention of current customers is really important. In order to retain customers, a company can provide discounts to long-term clients to show them appreciation for their loyalty. For instance, the Boots Advantage card offers to to cover the cost of a desirable product to permanent customers once they collect enough points. Companies might use customer survey in order to measure customer satisfaction and identify what will contribute to customer retention.
Loyal customers are arguably the most important factor in achieving business success and increasing customer loyalty can be achieved by keeping it personal and always following up when for instance ASOS sends email after the purchase to encourage the customers to ask them to share their opinion about the item. Key Account Management plays a vital role in retention as it not just about selling but it is focused to create the everlasting business relationships with the key customers. According to the Harvard Business Review, customer satisfaction increases 20% within a few years of starting a key account management program. Profits and revenue, meanwhile, can increase by 15%.
In retail banking if an ordinary customer has a query or issue they might be directed to solve their problem online or to call a helpline, however highly potential customer would be served directly by a Specialist, that looks after just a few major customers.
1.1.2 Database and Knowledge Management
A Knowledge Management System can not only help you to train new staff and conduct their orientation but also to promote sales. It allows Sales Representative to reach the required information in the right time rather than waiting for a response from someone from the company so the customer does not need to wait longer than is necessary and therefore provide a better experience for the customer and enhance the probability of successful sales. The Knowledge management platform can be also used for tracking the questions that the salesperson ask the most and which activities the top salesperson perform to achieve good results and therefore it can be leveraged further for training new hires. Recording customer information to the database is also a significant tool for increasing the sales and knowing the customer’s behavior, for example retails shops such as ASOS, a clothing online retailer, records customer’s order history to help them to identify the customer’s preferences based on what they might send emails suggesting purchase of similar types of products which leads to another sale.
1.1.3 Customer Relationship Management
Research conducted by Google and CEB indicates that customers that are emotionally connected to a brand are twice as likely to purchase a product or service, and are four times as likely to defend their purchase decisions. A wine producer organization Bespoke Collection builds deep customer relationships by offering loyalty programs and memberships, and by understanding their customer’s behaviour and through CRM solutions they are able to provide personal attention to their customers. The president of Bespoke Collection Paul Leary states, “When someone makes a purchase with us, the next morning at ten o’clock, they get an automated, personalized email… By placing emphasis on relationship-based sales instead of transaction based, we’re able to increase customer retention and satisfaction, referrals, and order value.” (Salesforce.com)
1.1.4 Marketing The Product
The Salesperson in most companies is now fully integrated into different activities such as marketing and they are involved in product development, maker development and the segmentation of markets. For instance, the opinion of salespeople is now valued as they know the customer most so they would be asking for suggestions when developing a new product so that provides an opportunity for gaining views from different perspectives.
1.1.5 Problem Solving and System Selling
Nowadays in times of highly competitive market, organizations aim to transform their business from a product-driven to a solution-led sales so that they invest in training their salesperson on “solution selling”, therefore the salesperson is able to help the customers to identify their problems, determine their needs and propose and implement effective solutions. This means, for instance, when a customer comes to the bank ask for a credit card, the customer advisor should not only end up making one transaction and applying for the bank product, but they should analyze customers’ needs and problems in order to provide a comprehensive financial solution in form of various products such as credit card, loan, investment products, saving account and even identify potential for mortgage.
1.1.6 Adding Value and Satisfying Needs
Organizations cannot rely on competing on price in the current market as the products and services are comparable, therefore they must focus on the value of the product or service when the price becomes less important. The salesperson has to explain how much they will benefit from the product, for example offering new software that would decrease customer’s cost for additional staff, paperwork or just simplify process within the company so that will increase overall performance. Tesla produces an electric vehicle with the mission to add value to the world by removing the need for fossil fuel, which means a lot for most of the customers.
All things considered, in today’s highly competitive world organizations should make sure that they hire the right salespeople that would understand the characteristics of modern selling and should invest in effective training their sales personnel in the art of selling in order to be successful. Moreover, the salespeople are the first point of contact with customers and building relationships does not happen from day to day, so it is really vital to retain the top performers within the company and aim to share their knowledge and skills with new hires. One of the crucial aspects of modern selling strategy is building strong relationships with current clients and transform them into key strategic accounts as current customers provide the organization much more profit and it is easier to predict their behaviour rather than acquiring new customers (Richerston).
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