CHAPTER 9 Developing and Qualifying a Prospect Base

Learning Objectives Discuss the importance of developing a prospect base Identify and assess important sources of prospects Describe criteria for qualifying prospects Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall

Learning Objectives Explain common methods of organizing prospect information Describe the steps in managing the prospect base Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall

Prospect, Prospecting, and Prospect Base Defined Prospect: a potential customer that meets the qualification criteria established by your company Prospecting: identifying potential customers Prospect base: is made up of current customers and potential customers Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall

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

Girard’s Ferris Wheel—Supply FIGURE 9.1 Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall FIGURE 9.1

Prospecting Requires Planning Increase number of people who board the Ferris wheel Improve the quality of prospects Shorten sales cycle by determining which prospects are “qualified” Prospecting plans must be monitored continuously for effectiveness Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall

Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall Sources of Prospects Referrals Centers of influence Directories Trade publications Trade shows and special events Telemarketing and e-mail Direct-response advertising and sales letters Website Computerized database Cold calling Networking Educational seminars Prospecting by non-sales employees Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall

Referrals Prospect recommended 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 have influence on opinion leaders Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall

Lead Generation See the Website Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall

Lead Generation See the Website Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall

Directories Hundreds of business and industrial directories available Many major trade associations publish directories Be sure to use current copy or edition as prospects shift firms; track people and companies Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall

Popular National Directories Middle Market Directory www.dnb.com TrackAmerica www.trackamerica.com Standard & Poor’s Corporation Records Service www.spcglobal.com Thomas Register of American Manufacturers www.thomasregister.com Polk City Directory www.citydirectory.com The Encyclopedia of Associations www.gale.com Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall

Trade Shows/Publications Trade shows and conventions: your company may have a booth at key trade shows/expositions Trade publications: each industry has trade publications that sales professionals need to read Join trade associations: many salespersons join trade associations to gain access to potential buyers Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall

Telemarketing Telemarketing: the practice of marketing goods and services through telephone contact To identify buyers and generate contact lists for sales staff To qualify prospects To verify sales leads generated by other methods To conduct follow-ups Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall

Direct Response and Sales Letters Direct response advertising: often features inquiry cards or information requests via mail or telephone Sales letters: send sales letters to decision makers, then follow up Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall

Website Websites provide a cost-effective way for sales professionals to: Project personal image Provide additional information Generate leads from visitors to site Present product information Establish e-mail lists Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall

Computerized Databases In-house databases: your firm may already have a comprehensive database, sometimes referred to as the “house list,” with details on customers, purchase patterns, and so forth List sources: wide range of precise lists available from variety of sources See www.infoUSA.com Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall

Computerized Databases Purchasing databases or lists can be costly; price usually set on cost-per-thousand names Not all relevant databases are equal; some “pull” better than others Pull is the percentage of the list resulting in qualified prospects or actual sales Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall

Cold Calling Simply calling prospects without referrals New salespeople rely on these as they haven’t built a referral base Must be strategically planned Prelude to in-person appointment A way to introduce yourself and your company to a prospect Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall

Networking Making and profiting from personal connections Networking guidelines Meet as many people as you can Tell them what you do Do not do business while networking Offer business card Edit contacts and conduct follow-ups Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall

Three Types of Networks FIGURE 9.2 Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall

Educational Seminars Provide opportunity to showcase product without pressuring to buy Require extensive preparation Start value-added process Can attend or present at industry-sponsored seminars or offer your own Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall

Non-Sales Employees Non-sales personnel can be valued source of leads Prospecting not necessarily exclusive task of sales force Non-sales personnel often need training and incentives Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall

Combination Approaches Salespersons generally rely on combination of prospecting methods Some methods have higher yield than others Important to use CRM technology to help maximize efficiency Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall

Qualifying Prospects Basic questions: Does the 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? Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall

Collecting and Organizing Prospect Information Sales data can be collected and organized into Customer Relationship Management (CRM) Systems Examples of popular applications: Salesforce.com Oracle NetSuite Microsoft Harvey Mackay suggests a 66-question customer profile. See it at:mackay.com Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall

The CRM Contact Sheet FIGURE 9.3 See the Website Sample CRM Contact Sheet from Salesforce.com FIGURE 9.3 See the Website Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall

Managing the Prospect Base Sample CRM record for one salesperson’s prospects from Salesforce.com FIGURE 9.4 See the Website Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall

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

The Portfolio Model for Classifying Prospects FIGURE 9.5 Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall

The Sales Funnel Model FIGURE 9.6 Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall

Using CRM Technology for Pipeline Management Sample CRM pipeline dashboard from Salesforce.com See the Website FIGURE 9.7 Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall

Key Concept Discussion Questions Discuss the importance of developing a prospect base Identify and assess important sources of prospects Describe criteria for qualifying prospects Explain common methods of collecting and organizing prospect information Describe the steps in managing the prospect base Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall

Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. Printed in the United States of America. Copyright © 2010 Pearson Education, Inc.   Publishing as Prentice Hall