Hospitality Sales and Marketing Situational Selling Chapter six 1

Situational Selling  All buyers have different perceptions of value  Sellers must use different selling strategies and tactics and be able to tell which ones will be appropriate in different buying situations  The “situation” to be addressed reflects the value as perceived by both buyer and seller 2

Situational Selling  Both buyer and seller must answer a series of questions to arrive at an assessment of value  The assessment drives the selling strategies for each “buying situation”  Situation… 1.Is the industry in a state of perfect or imperfect competition? 2.Is there competitive differentiation? 3.Does the exchange involve complex or simple products? 4.In what stage of the product life cycle is the property? 3

Situational Selling  With perceptions in hand we address each situation with a few basic strategies and tactics –Strategies are the overall plans to help reach a goal –Tactics are things you can do that work toward reaching the goal…face to face behavior 4

Situational Selling  Situation #1: Perfect or imperfect competition –Several categories of competition  Monopoly…one supplier  Oligopoly…a few suppliers in an unofficial alliance  Imperfect competition…several suppliers but customers have limited access to product offerings  Perfect competition…several suppliers and customers have wide access to information about their product offerings 5

Situational Selling  Situation #2: Competitive differentiation –People generally buy on price when products have similar quality –Segment continually fights off commoditization –Low cost “go to market” selling strategies are employed 6

Situational Selling  Situation #3: Simple versus complex products and services –Simple products tend to compete on price –Complex products attempt to compete on value through relationships and product/service customization 7

Situational Selling  Situation #4: Product Life Cycle (PLC) –Introduction stage –Growth stage –Maturity stage –Optimization (Decline) stage 8

Situational Selling  Each stage requires a property to adjust the way it “goes to market”, or simply said, adjust its selling strategies –Introduction stage  Production is key. All sales are good sales  Key challenge is getting the product established –Growth stage  Increase prospect coverage. More sales people employed focusing on more market segments  Sales (and profits) grow rapidly  Key challenge is driving market share 9

Situational Selling  Each stage requires a property to adjust the way it “goes to market”, adjust its selling strategies –Maturity stage  Begin to launch new products/services  Begin defining most worthwhile customer segments  Begin to discount to protect share  Key challenge is preventing obsolescence or the decline stage –Optimization (or decline) stage  Begin to pursue targeted business…more narrow the focus…  Optimize returns by creating lifetime customers  Key challenge is how to develop and implement strategies that deliver value added solutions to targeted customers 10

Situational Selling  Basic value buyers are –Intrinsic –Extrinsic –Strategic  Basic selling strategies are –Transactional –Consultative –Alliance –Multiple channel selling strategy  Selling tactics are face to face actions –Prospecting tactic…law of large numbers –Negotiation tactic…can be win/lose or win/win –Relationship tactic…problem solving “co-create solutions” –Partnership tactic…Lets grow and change together (MPI example of streaming a meeting to a large audience “outside the room” 11

Situational Selling  Selling strategies are implemented to two ways –Individual approach –Team approach  Ad hoc teams  Formal teams 12