Customer Relationships and Selling Strategies
Firms put a lot of time and energy into maintaining relationships with certain types of customers. Generally, large volume buyers, innovative lead users, and market influencers receive the most attention by salespeople. It is often more profitable to ship to a few large volume buyers than many small order customers. Lead users and market influencers often have the expertise and resources to assist the company in developing better offerings and influencing additional purchases.
Types of Sales Relationships
Sales relationships operate along a continuum based on a level of intimacy and trust similar in other relationships. On one end is transactional relationship where there is little interest in an ongoing relationship. On the other end is a strategic partnership where the relationship is akin to a marriage. In a transactional sales relationship, each sale is a separate exchange and the two parties to it have little or no interest in maintaining an ongoing relationship. A functional relationship is a limited, ongoing relationship that develops when a buyer continues to purchase a product from a seller out of habit, as long as his/her needs are met. Affiliative selling relationship is one where a significant amount of expertise is needed from the seller and trust is an issue. Strategic partnership is one in which both the buyer and seller commit time and money to expand "the pie" for each other. This is the most involved relationship and is often compared to a marriage. The types of relationships are not a process—not every relationship starts at transactional and moves through function and affiliative to strategic. It is not the goal to make every relationship a strategic partnership. The level of the desired relationship is directly related to how "valuable" the customer is viewed to be to the company.
Selling Strategies
A salesperson's selling strategy differs depending on the type of relationship he/she has or wants with the customer. There are four selling strategies, ranging from script-based selling to strategic partnering.
Script-Based Selling
- Also known as canned selling, this type of selling is where salespeople memorize and deliver sales pitches verbatim.
- Originated with National Cash Register (NCR) in 1880s. Company realized some salespeople were more successful than others because they were doing better sales pitches. The company standardized the sales pitch and required all salespeople to use it.
- Script-based selling works well when customers' needs don't vary much and it ensures that all the important details of the product are presented.
Needs-Satisfaction Selling
- The process of asking questions to identify a buyer's problems and needs and then tailoring a sales pitch to satisfy those needs is needs-satisfaction selling.
- Type of selling works well with fairly standard products.
- Example: Car sales. Customers look for different features in automobiles based on their individual needs.
Consultative Selling
- Consultative selling involves the salesperson using their expertise to create a customized solution to meet the customer's needs.
- Similar to needs-satisfaction selling, consultative selling involves products that can be more customized to meet the needs of buyers.
- Example: TAC is a company that creates customized solutions to make office and industrial buildings more energy efficient.
Strategic Partner Selling
- In this selling relationship, both parties invest resources and share their expertise with each other to create solutions that jointly grow each other's businesses.
- Relationship is a mutually beneficial partnership with a high degree of trust.
- Example: Ted Schulte and the cardiologists he works with.