Importance of Sales

Importance of Sales

In this lesson, we will cover the basics of Sales.
You’ll learn about the role of sales in an organization, how consumers make their decision to buy a product/service and some common sales trends.

As a financial bloodline of any business, Sales is the most crucial part of a successful company’s operations.

Sales is revenue, sales is cash flow, sales enables research and development, sales covers payroll, and sales drives profit.

So without sales, a business cannot function. Thus, sales is survival!

Over the past few decades, Sales has evolved from ABC (always be closing) to ABC 2.0 (always be curious) while some concepts remain relevant to this day.

Here’s one wildly popular movie scene that explains the always-be-closing principle from the film, Glengarry Glen Ross.

The ABC of Sales 2.0

Sales 2.0 puts a different spin on ABC – always be curious
Make sure you’re: empathetic to your buyer; providing real value and expert advice; being honest and showing integrity as a salesperson.

Contrast that with the video you just saw and aggressive hustlers that Salesmen were expected to be.

Developing or further enhancing your sales skills will be one of the best investments you can make – even if you don’t have to sell in business, you need these skills in life.
E.g. selling your resume to a new employer, selling an investor on your business idea or selling an airline to upgrade your seat.

Importance of Sales Skills

To many people, the word selling implies manipulating, pressuring, cajoling–all the used-car-salesman stereotypes.

But if you think of selling as explaining the logic and benefits of a decision, then everyone–business owner or not–needs sales skills.

In essence, sales skills are communication skills. Communication skills are critical in any business or career–and you’ll learn more about communication by working in sales than you will anywhere else.

Role of Sales in an Organization
In any organization, the sales department plays a pivotal role in the success of the business. The unique and important role of sales is to bridge the gap between the potential customer’s needs and the products/services that the organization offersthat can fulfill their needs.

Here are some of the key ways in which sales impact an organization’s success:

1) Sales Lead Conversions

Often, salespeople are dealing with prospects who have an existing awareness of the company through marketing and advertising efforts, and it’s the job of the salesperson to close the deal by providing further information and helping the customer make a decision.

Take for example, car sales. You typically go to a car dealership knowing that you’re looking for a car. The car salesperson will ask you questions about your personal life including family size, daily routine etc. in order to gain insight into what you would use the car for. They can then offer information about various cars in the dealer’s range that would suit your needs and guide you in making an informed decision about which car is the one for you.

Because salespeople interact directly with the potential customer, they have the advantage of being able to obtain personal knowledge that will aid them in delivering their sales pitch and tailoring their offerings to their audience.

This is often an attractive aspect for customers, as they may view the salesperson as the expert, which builds credibility and therefore trust.

2) Business Growth

Sales play a key role in the building of trust between a customer and business. Trust and loyalty are the main reasons why a customer would choose to recommend your company to a friend or write a great review of your product or service online.

Prospects and customers have always valued recommendations and reviews. Since they come from a third party, the perception is that reviews are independent of the seller and therefore carry more credibility. 

In the digital age, reviews are extremely influential, due to the reach and power of social and online media. During sales interactions, encouraging the customer to recommend a friend or give positive feedback can have an impact on the growth of the business through increased brand awareness and sales.

3) Customer Retention

Selling is a personal interaction between two people, which is a powerful thing. Never underestimate the personal connection between two people, and the potential effect this can have on your brand’s reputation.

Excellent salespeople are those who not only make the sale, but create a long-lasting impact on the customer. Long-term customer relationships lead to repeat customers, referrals and increase the brand’s reputation by word of mouth.

One of the keys to customer retention through sales is to perform sales follow-ups. Setting up after-sales calls or meetings is a great way to maintain and build a positive relationship and gives the customer an opportunity to provide feedback based on their experience. If the customer has a complaint or issue, it can be dealt with quickly and professionally.

Too often, unhappy customers will not complain – they will simply switch to another provider and won’t recommend you to others.

It’s more cost-effective to retain customers than to win new ones, so look after your existing customers well.

Why & How Consumers Buy
There are three main factors that affect a person’s decision to purchase a product/service:

1) Logic

The first reason is logic. Management consulting firms like McKinsey stress the need for organizations to buy rationally. So they provide heavy return-on-investment analysis. There’s plenty of dialogue on cutting out waste. There’s also heavy emphasis on corporate decision-making skills.

To this group, it’s all about specs and numbers; buyers buy from the seller that makes the most tightly reasoned case (especially B2B!). However, this is rarely the number one reason.

2) Emotion

The next expert opinion on how best to sell involves emotion. If you talk to the Emotional Quotient (EQ) of people, all buying decisions are ultimately emotional buying decisions. Gut feeling comes first — fear, greed, irrational desire. Logic only comes in later – if ever.

These experts claim that buyers always buy from the heart and from the gut, and they find reasons to justify a purchase. The EQ case has plausible support. We’ve all bought things impulsively; we’ve all done things because we felt them to be right, without always having hard evidence.

[Optional] 6 Emotions That Make Customers Buy
3) Survival

The third idea is survival. It’s based on the Hierarchy of Needsdeveloped by psychologist Dr. Abraham Maslow. Maslow’s studies showed that while many different drivers motivate people, some are primal and fundamental. And the most fundamental is the survival instinct.

According to Maslow, people buy in order to satisfy needs, and no need is more basic and powerful than the need to survive, both personally and professionally.

[Optional] The SEL Method
Watch this 4-minute video to learn more.

Link to the video: https://www.youtube.com/watch?v=_tyIS1CCSlM

Most salespeople use one of these three reasons (logic, emotion, survival), while the buying decision involves all three.
See full-size image: http://bit.ly/2kGgQnd
[Optional] Do you really understand how your business customers buy?
McKinsey shares a nice piece on why people buy and how it’s aligned with the buyer’s journey. Read this article to learn more:
http://www.mckinsey.com/business-functions/marketing-and-sales/our-insights/do-you-really-understand-how-your-business-customers-buy
Sales Trends
“74% of all salespeople have less than 20% of the skills required to sell competitively in today’s marketplace.”

– David Kurlan, CEO of Objective Management Group

The fact that the world has become more connected and digitized in the last two decades has forced sales people to go from hard-sellers to helpers and consultants, breeding the so-called ‘consultative sale’ method. 

SPIN Selling, a 1988 Sales classic by Neil Rackham has produced a winning formula: be a good listener and use situation-problem-implication-need questions to close.

SPIN Selling

SPIN Selling is based on extensive research by Rackham and his company, Huthwaite. They examined complicated sales scenarios. After analyzing more than 35,000 sales calls, they were able to put to rest a variety of traditional sales myths.

They found that in successful sales calls, it’s the buyer who does most of the talking, which means that the salespeople are asking questions and trying to build a rapport with the buyer.

SPIN Selling proposes that there are four types of questions:

– Situation
– Problem
– Implication
– Need-payoff

– Situation Questions deal with the facts about the buyers existing situation.

– Problem Questions ask about the buyer’s pain and focus the buyer on this pain while clarifying the problem. These give Implied Needs.

– Implication Questions discuss the effects of the problem, before talking about solutions, and develop the seriousness of the problem to increase the buyer’s motivation to change.

– Need-Payoff Questions get the buyer to tell you about their Explicit Needs and the benefits your solution offers, rather than forcing you to explain the benefits to the buyer.

Relationship between Sales & Marketing 

The last decade has brought Sales and Marketing much closer together. Demand and lead generation via content marketing has become the norm.

The birth of inbound marketing is designed to help Salespeople work on relevant leads generated by Marketing and to separate information gatherers.

Marketing Automation Systems have elevated the practice of email marketing to a sophisticated world class operation that captures the right prospects at the right moment in the buying cycle. This separates information gatherers from leads to be engaged via the Sales cycle.

The explosion of analytics, lead scoring, predictive lead analysis and software alike has further enabled Salespeople to be able to sell to relevant prospects at the right time, thus only focusing on high value leads that can close.
Additionally, with the digitalization of the world, Sales Intelligence tools are popping up everyday. Companies today can zoom in on the right segment and target the right audience with very focused messaging using marketing automation systems such as Hubspot, Marketo or Eloqua, for example.
Here’s a good summary of the evolution of Sales Intelligence tools.
Enlarged image: http://bit.ly/2kqdnf3
Sales Intelligence Tools
G2 Crowd summarizes Sales Intelligence tools in the diagram below.
Enlarged image: http://bit.ly/2juVex5
Jim Rohn Sứ mệnh khởi nghiệp