1
Chapter Five—Strategic Prospecting and
Preparing for Sales Dialogue
Learning Outcomes
After completing this chapter, you should be able to:
1. discuss why prospecting is an important and challenging task for salespeople.
2. explain strategic prospecting and each stage in the strategic prospecting process.
3. describe the major prospecting methods and give examples of each method.
4. explain the important components of a strategic prospecting plan.
5. discuss the types of information salespeople need to prepare for sales dialogue.
Chapter Outline
I. Introduction
II. The Importance and Challenges of Prospecting
III. The Strategic Prospecting Process
A. Generating Sales Leads
B. Determining Sales Prospects
C. Prioritizing Sales Prospects
D. Preparing for Sales Dialogue
IV. Prospecting Methods
A. Cold Canvassing
B. Networking
C. Company Sources
D. Commercial Sources
V. Developing a Strategic Prospecting Plan
VI. Gathering Prospect Information to Prepare for Sales Dialogue
A. Basic Information about the Prospect
B. Information about the Selling Situation
C. Sources of Information
Exercises
Developing Professional Selling Knowledge
1. Why is prospecting an important activity for salespeople?
2
Prospecting is an important activity for salespeople because it is the primary means of
generating revenue and guarding against the effects of customer turnover. While it’s
2. What are the objectives of strategic prospecting?
The primary objective of strategic prospecting is to identify, qualify, and prioritize sales
3. Why is prospecting difficult for some salespeople?
Prospecting is difficult for some salespeople because it is a process filled with rejection.
4. What are the disadvantages of cold canvassing prospecting methods?
The primary disadvantages of cold canvassing prospecting are that it is inefficient and can
have a detrimental impact on the image of the salesperson. Cold canvassing is inefficient
3
5. What are the basic criteria used to qualify leads as sales prospects?
Qualified sales prospects are leads who:
6. What approaches can be used to prioritize sales prospects?
One approach is to create an ideal customer profile and then analyze sales prospects by
7. What are the major components of a strategic prospecting plan?
The major components of a strategic prospecting plan include the following:
8. What types of information should salespeople gather to prepare for sales dialogue?
The salesperson should collect information about the prospect and the prospect’s
organization. Regarding the prospect, the salesperson should, at least, know the prospect’s
9. How can salespeople use electronic networking as a prospect method?
Salespeople can use electronic or social networking to enhance prospecting in a variety of
10. What company sources can be used for prospecting?
Many organizations provide a variety of ways to help salespeople generate leads and
Group Activity
Divide the class into groups of three to five. Each group has been hired as a consultant by a new
company to develop a strategic prospecting strategy. The company brews and bottles a specialty
tea beverage. The tea is rich in vitamins, anti-aging nutrients, and natural anti-carcinogens. The
tea is expensive to brew and has a suggested retail price of $3.00 per 16 oz. bottle. The company
is located in your town. It can produce 5,000 bottles per day and does not sell the tea directly to
consumers.
The strategic prospecting strategy should include:
• How leads will be generated
• How leads will be qualified
• How sales prospects will be prioritized
• How information to prepare for sales dialogue will be obtained
• How the strategic prospecting strategy will be tracked and evaluated
Experiential Exercises
1. The Effectiveness of Different Prospecting Methods
Objective: To help your students understand the advantages and disadvantages of different
prospecting methods.
5
Time Required: 30 to 40 minutes
Teaching Tip: This exercise can be assigned during the previous class session. At the
beginning of this class session, allow about 15 minutes for students individually or in groups
to compile the advantages and disadvantages of cold canvassing, networking, company
sources, and published sources prospecting methods. Then, call on students individually or
by groups to present their results. You should summarize these on a blackboard or flip chart.
Conclude the exercise with a summary and then a discussion of how different prospecting
methods might be used together to capitalize on the strengths of each method.
2. Developing a Strategic Prospecting Strategy for Getting a Job
Objective: To help your students understand the strategic prospecting process by applying it
to a situation of interest to them.
Time Required: 30 to 40 minutes
Teaching Tip: This exercise is best done by each student individually. Each student should
indicate the type of job they would like to obtain upon graduation. Then, give each student
about 15 minutes to address the following questions:
• What prospecting methods would be used to identify potential job leads?
• How would these leads be qualified as job prospects?
• How would these job prospects be prioritized?
• What types of information would the student gather prior to contacting the best job
prospects?
After students have addressed these questions, call on individual students to present their
answers to each question. Conclude the exercise with a synthesis and summary of the discussion.
Chapter 5 Case
Developing a Strategic Prospecting Plan
Background
Jennifer Hamman graduated from the state university and was hired as a sales representative for
the Logistics Company. The Logistics Company is a transportation broker that links companies
needing products shipped with trucking firms to carry the shipments. After an initial training
program, Jennifer was given a couple of existing company customers and a small list of leads to
get her started. She began by serving the shipment needs of the existing customers. This gave her
6
some confidence, but she realized that for her to be successful, she must begin prospecting and
try to identify the best sales opportunities. The Logistics Company provides an ongoing list of
leads that can be accessed by all salespeople. Once a salesperson contacts one of these leads, no
other salesperson can contact them. Jennifer started her prospecting by contacting these leads.
Current Situation
Jennifer has been calling a number of leads each day, but has not been very successful in
generating much business. She feels like she is wasting much of her time on leads that are not
good sales opportunities. The leads provided by her company are not qualified in any way and
the training program she attended focused on cold calling as the basic prospecting method.
Jennifer took a professional selling class in college and remembered that the chapter on
prospecting emphasized the need to follow the strategic prospecting process to identify the best
sales opportunities. She found her professional selling textbook, went to the chapter on
prospecting, and decided to create a strategic prospecting plan.
Questions
1. What methods should Jennifer use to generate sales leads beyond those provided by her
company?
Jennifer should refrain from cold calling. Cold calling is an inefficient method when it
comes to prospecting. Jennifer can use referrals—sales leads that a customer or some other
2. How should Jennifer qualify the leads provided by her company and those she generates
herself? What is the profile of an ideal prospect?
Jennifer can qualify the leads provided by her company in the following ways:
• Online searches
7
3. How should Jennifer prioritize her qualified prospects?
Jennifer can create an ideal customer profile and then analyze sales prospects by
4. What information should Jennifer collect to prepare for sales dialogue with a prospect?
Jennifer should collect basic information about the prospect. Buyer’s name, title, contact
5. Jennifer used LinkedIn during college and wanted to employ it in her strategic prospecting
process. How can she best use LinkedIn?
She can use LinkedIn as a source for identifying ideal prospects. She can also use this as a
Role Play
Situation: Read case and prepare a strategic prospecting plan.
Characters: Jennifer and her sales manager.
Scene: Jennifer has implemented her strategic prospecting plan and been very successful. She
has been the top seller in her office for the past two months. Her sales manager is impressed and
8
he asks her what she is doing to be so successful. She indicates that her success is due to
spending most of her time with the best sales opportunities. He wants to talk to her about her
strategic prospecting plan and sets up a meeting.
Location: Sales manager’s office.
Action: Role play the meeting between Jennifer and her sales manager. The sales manager
should ask many questions and Jennifer will respond to these questions. The use of LinkedIn has
been valuable to Jennifer and no other salespeople at the Logistics Company are using LinkedIn,
so make sure the role of LinkedIn is included in the role play.
Chapter 5 Role Play
Prospecting and Gaining Prospect Information
Background
Preston Adams has just completed the sales training program for the Office Copier Company
(OCC). Adams has been assigned a territory in Illinois that includes the metro areas of
Bloomington, Decatur, and Peoria. The company once commanded a significant market share in
these markets. However, due to a problem with a previous salesperson in these markets three
years ago, OCC has not been directly working this particular region of central Illinois. Although
there is a large number of their machines still in use across this territory, it has been a while since
a salesperson has called on any accounts. As with any geographic area, there have likely been a
lot of changes with existing companies moving or even going out of business and new
companies opening up.
Current Situation
Adams’s sales manager, Eric Waits, is coming in two weeks to spend three days in the field with
Adams calling on prospective accounts. Adams is working to develop a list of leads that he can
qualify and then contact in order to set up the sales calls he will be making with his manager.
Role Play
Situation: Read the Role Play Prospecting and Gaining Prospect Information.
Characters: Preston Adams, salesperson for OCC; Jerri Spencer, office manager with
purchasing responsibilities for Peoria-based McKelvey and Walters, Attorneys-at-Law.
9
Scene:
Location—Preston Adams’s office at OCC.
Action—In the course of Adams’s prospecting activities, Spencer and the McKelvey and Walters
law firm have come up as a strong prospect for Xerox’s new line of professional copiers.
McKelvey and Walters operate a large office in Peoria that occupies most of two floors in the
Planter’s Bank Building and a branch office in Bloomington. They were previously a customer of
OCC, but the information that Adams has obtained indicates that they are using an unspecified
variety of different brands of copiers.
Role play the phone conversation between Adams and Spencer as Adams introduces himself and
his company to Spencer, gathers needed information to better qualify the prospect, and asks for
an appointment for an initial sales call.
Chapter 5 Continuing Case
Fishing for New Customers
Brenda Smith has been very successful at getting existing customers to upgrade or purchase new
copiers during the past two months. She is, however, disappointed in her efforts to get new
customers. In order to add more new customers, Brenda has been spending a great deal of time
prospecting. These efforts have produced a large number of leads. Once she generates a lead, she
contacts the firm and tries to set up an appointment. Unfortunately, most of these leads are not
interested in talking about copiers and are not willing to schedule a meeting with her. This has
been so frustrating that she decided to make several cold calls this week to see if this would be a
good way to get to meet with prospective customers. The cold calls were also not very successful
and were extremely time consuming. Brenda did finally get a few leads to agree to meet with
her, but these appointments were not very productive. The leads were typically satisfied with the
copiers they were using and were not interested in learning about NCC copiers.
Pat Brady, her sales manager, accompanied her on a recent sales call to a lead. After the sales
call, Pat expressed his disappointment that they had really wasted their time with this meeting.
Pat then asked Brenda about her prospecting process, because it was clear that she was not
identifying and spending her time with the best sales opportunities. Her approach was not
working well and was taking a lot of time. If she continued doing the same things, Brenda was
not likely to generate many new customers and might lose some existing customers, because she
was spending too much of her time prospecting.
Brenda realizes that she must improve her prospecting process, but is not sure exactly how to
proceed.
10
Questions
1. What is Brenda doing wrong? What would you recommend Brenda do to improve her
prospecting efforts?
First, Brenda needs to develop a strategic prospecting plan that incorporates the elements
2. Explain the strategic prospecting process to Brenda and discuss how she can implement it.
Strategic prospecting process is a process designed to identify, qualify, and prioritize sales
opportunities, whether they represent potential new customers or opportunities to generate
additional business from existing customers. Strategic prospecting involves the following
components:
• Generating sales leads
3. What secondary lead sources would you recommend Brenda use to identify the best
attorneys, architects, accountants, and medical professionals as prospects?
There are a variety of secondary lead sources available to Brenda. The first is the phone
4. What specific types of information should Brenda obtain before contacting a qualified
prospect?
At the very least, Brenda should know the name and title of the lead she is hoping to
11