Basic Marketing Concepts Demystified! – Part Four: The Sales ProcessMarketing November 8, 2013
What Happens When You Sell Something?
A typical answer would explain that it happens when at least one thing of value gets exchanged for another. That’s exactly what happens in the sales process.
But this begs plenty of questions: How did you find someone to sell to? How did you figure out the value of your offer against theirs? How eager were they to make an exchange? How did you present your offer? Did you give them a reason to continue doing business with you?
Every single time a sale is made, there are several things going on leading up to its conclusion. Like blinking or breathing, you don’t have to think about these things for them to happen.
But they will happen anyway, regardless of whether or not you are conscious of them. Each part of the sales process represents an immense opportunity for any enterprise.
For starters, much of what you learn from your interaction with customers at different points of the process will help develop all your other strategies.
R&D, marketing, hiring, workspace design, website and content development — you name it — will all be affected by things that happen during your sales process in one way or another.
It’s surprising that many businesses are able to function or even succeed, without so much taking a good look at what happens when sales are made, basically just by doing everything by the seat of their pants. People have succeeded in business for thousands of years without ever caring about it.
Does knowing the sales process matter? To use yet another imperfect analogy, you could be a bodybuilder by eating five dozen eggs a day (aka the Gaston method) and just lifting whatever heavy weights you have lying around – but you’d be stupid to try. A serious bodybuilder will study their own physiology and match that with the right diet and exercise regimen to develop the right proportions and bulk up with the least amount of wasted effort.
Sales Benchmark Index, a marketing agency that focuses on sales states on their site:
“Companies that deploy a formal sales process, when compared to the mean, win 48% more, have sales cycles 37% shorter and generate 2x the revenue per head. The reason they have been able to consistently produce above average results is due in part because they have a formal sales methodology that the sales follow to manage their opportunities.”
Take this with a pinch of salt, since this is from a company that’s got a vested interest in marketing and sales consultancy. But the logic is sound and even if the truth were just a quarter of those figures, it would still be a massive improvement over doing nothing.
Great! You’re ready to take a crack at optimizing your sales process. All you have to do is figure out what the steps are. Unfortunately, if you’re looking for a definite answer that perfectly suits your business, you won’t find it here – or anywhere else.
While many business and marketing writers have come up with excellent frameworks you could copy or play around with, it’s unlikely any single process would be a perfect fit for every business. For example, in Management of a Sales Force by Rich, Spiro and Stanton, sales are broken down into these steps.
- Prospecting /First contact
- Planning the sale
- Customer needs assessment
- Meeting objections
- Gaining commitment (closing)
Rich, Spiro and Stanton are writing from the perspective of sales team managers for sales team managers. Not every business would prioritize sales in the same way. You might not need to do active customer needs assessment all the time, nor would they want to develop relationships (such as when a product is understood to be a fad with a short product cycle) for example, and this step might be a useless distraction for some businesses.
For those who went to business school in the 90′s through the 2000′s, this is probably the process (more or less) that you’re familiar with.
- Building Rapport
- Identifying Needs
- Delivering Persuasive Presentations
- Overcoming Objections
- Closing the Sales
- Getting Repeat Sales and Referrals
Pretty similar to the 8-step framework, except that planning the sale isn’t emphasized and getting repeat sales and referrals is. Does it make the 7-step process any more or less correct than the other one? Of course not. It all depends on what you feel suits your business.
You will find no shortage of alternate processes, some with as few as 3 steps, others with as much as 10 or more stages. If you feel it will work great for you, by all means, go for them. But what does “working great” really mean when we talk about sales processes?
Sales Processes Work When They:
- Improve data gathering and forecasting
- Help isolate problems with customer interaction
- Help sales and marketing empathize with customer needs
- Allow repeatable success
- Help improve chances of repeat business
- Address both short-term sales and long-term marketing goals
What Most Sustainable Sales Processes Lack
Here’s another example of an even shorter sales process framework. We’re not too enthusiastic about this one because it doesn’t directly address getting repeat customers or anything that happens after a sale.
- Identify Needs
- Present Solutions: Features, Benefits, Proof
- Check Progress: Trial Close
- Overcoming Objections
- Close the Sale
Again, it might not be a problem for your business model, but…
a sustainable sales process must address what happens after a sale.
Going back to the Pareto Principle, a stable business would normally have around 20% of its customers responsible for around 80% of all sales. If stability is desired, repeat business is a prerequisite. Servicing, warranties, offering complementary products – these are just a small fraction of the money-earning possibilities your frontliners could inject after you make a sale.
Why Does This Happen?
We were hoping you’d tell us in the comments, but we’ll go with something less reliable instead. I have a personal hypothesis why so many sales process models lack this crucial element – they were developed by salespeople, not marketers or long-time business owners.
Before you lynch me, I know sales is a really challenging job, and very few people are cut out for it. And it is called the “sales process” after all. But like they say, if you only have a hammer, every problem looks like a nail. Successful career salespersons are often supremely equipped mentally and professionally– for closing sales.
The problem is that sales goals tend to be short-term. Without experience from another perspective, it might become easy to lose sight of other things that matter.
Marketing teams and planners for enterprises that are fully intended to last will tend to look at the bigger overall picture and are more likely to sacrifice the short-term results in favor of something that would be better overall in the long term.
However, marketers may not have the direct boots-on-the-ground closeness of sales people and may find it difficult to understand more immediate issues. If you have to create a process for the long haul, it should help managers address both short-term sales concerns and long-term marketing needs.
What’s your sales process? We’d love to know!
Other parts of our Basic Marketing Concepts series!
Sources and Additional Reading
- Paul H. Selden (1997). Sales Process Engineering: A Personal Workshop. Milwaukee, WI: ASQ Quality Press. p. 23. ISBN 0-87389-418-9.
- William H. McNeese and Robert A. Klein (1991). Statistical Methods For The Process Industries. Milwaukee, WI: ASQC Quality Press. ISBN 0-8247-8524-X.
- Selden (1997). p. xxii. Missing or empty
- “The Sales Funnel”, www.mindtools.com
- Paul H. Selden (November 2000). “The Power of Quality Thinking In Sales and Management”. Quality Progress: 58–64.
- Barry, Thomas. 1987. The Development of the Hierarchy of Effects: An Historical Perspective. Current Issues and Research in Advertising, 251-295.
- A modern purchase funnel concept – Marketing-made-simple.com (2009)
- The customer decision journey – McKinsey Quarterly(2009)
Rube Goldberg Device: whosdadog via photopin cc
Warranty: Thomas Hawk via photopin cc
Salesman: That Hartford Guy via photopin cc
Horse salesman: Wystan via photopin cc
Flip-flops: Stuck in Customs via photopin cc
Shoes: Raymond Larose via photopin cc
Gears – commons.wikimedia.org Shrug- Wikipedia.org