CHAPTER 6
Prospecting: The Lifeblood of Selling
LECTURE OUTLINE
I. THE CORE PRINCIPLE: PROSPECTING
A. People want to trust the person they buy from.
B. New customers are frequently gained through referrals, which are earned by
displaying integrity, truthfulness, and character to the current customer.
II. THE SALES PROCESS HAS 10 STEPS
A. Sales Process – a sequence of actions taken by the salesperson which leads toward the
customer taking a desired action and ends with follow-up to ensure purchase
satisfaction.
B. 10 steps in the selling process:
1. Prospecting
2. Pre-approach
3. Approach
4. Presentation
5. Trial Close
6. Objections
7. Meet Objections
8. Trial Close
10. Follow-up
III. STEPS BEFORE THE SALES PRESENTATION
A. Prospecting.
B. Obtaining an appointment.
C. Preapproach planning.
IV. PROSPECTING – THE LIFEBLOOD OF SELLING
A. Prospect – a qualified person or business that has the potential to buy your product or
service.
B. Prospecting – identifies potential customers.
1. Increases sales.
C. Why is prospecting important to a business?
1. Customers purchase our firm’s products and services and thereby create
revenue.
a. Revenue defined as the number of products sold multiplied by the
price of the product.
a. Revenue is the key to ensuring the business is an ongoing
entity.
b. Revenue used to fund the organization’s strategies and
b. Salespeople serve an important role by developing a stream of
revenues for the firm’s products and services.
D. The prospecting process
1. Step 1: Lead generation and development
a. “Lead” – a person or business who might be a prospect.
b. Lead generation focuses on establishing a group of firms and
individuals that may be in the target market for your solution (i.e.
product or service).
2. Step 2: Qualifying a lead
a. Transformation of a lead to a prospect occurs through an evaluation
process, called the lead qualification process
b. Lead qualification refers to the steps that the salesperson uses to
evaluate the lead.
a. Goal of qualifying a lead is to help understand which leads
have the potential to become a buyer.
c. Questions to ask to determine if an individual is a qualified prospect:
a. Does the prospect have the money to buy?
b. Does the prospect have the authority to buy?
c. Does the prospect have the desire to buy?
3. Lead qualification and lead scoring
a. Lead scoring system grades each lead based on a range of criteria
b. Lead scoring system helps salespeople understand which leads
become prospects and categorizes prospects into groups.
V. PROSPECTING IS AN ONGOING PROCESS
A. Customers are coming in and going out of the salesperson’s sales base.
2. U.S. attrition rate: 20% on average
a. Most firms are always prospecting.
B. The cost of acquiring a new customer is higher than keeping a present one, which is
why service follow-up is so important.
VI. PLANNING A PROSPECTING STRATEGY
A. Identifying prospects is one of the more challenging stages of the selling process
B. Prospecting requires a strategy
VII. PROSPECTING METHODS
A. Prospecting on the web
1. Fast and easy way to find information about individuals or businesses by
using internet
B. Email marketing
1. Firms may purchase lists of potential contacts, including their e-mail
addresses
2. Firm e-mails opportunities, offers, and invitations to potential customers
C. Social media platforms
1. LinkedIn, Facebook to find potential buyers
2. Utilize social media to communicate product and service reviews and
1. Host webinars, demonstrations, insight on trends, easily accessible on–
demand videos
E. Cold Canvas method – relies solely on the volume of cold calls made.
F. Endless Chain-Customer Referral – after every sale or contact, the salesperson asks
the customer for a list of several friends who might be interested in the product
1. Referral: Person or organization recommended to you by someone who
feels that this person or organization could benefit from you or your
product
G. Orphaned Customers – salespeople often leave their employers to take other jobs and
their customers are left as new prospects for other employees.
H. Sales Lead Clubs – an organization or group of salespeople in related but
noncompetitive fields that meet twice a month to share leads and prospecting tips.
I. Prospect lists
2. Determine where you might similar types of firms/people
J. Get Published – by convincing an editor that you’re an expert in your field, you
become one and prospects will come to you when they are ready to buy.
1. Research publications and insights
2. Firms create e-books, white papers, executive summaries, or research
overviews that provide useful and timely insights into the customers’
industries, consumers, processes, and technology.
K. Public Exhibitions and Demonstrations – frequently take place at trade shows and
other types of special interest gatherings
L. Center of Influence – involves finding and cultivating people in a community or
territory who are willing to cooperate in helping to find prospects.
M. Direct Mail – an effective way to contact individuals and businesses.
1. Direct-mail advertisements have the advantage of contacting large numbers
of people, who may be spread across an extended geographical area, at a
relatively low cost
N. Telemarketing – allows for person–to-person contact and interaction between the lead
and the caller.
O. Teleprospecting
1. Process to qualify a prospect and to determine if an organization is the
right fit for their product. Hence, it often involves a number a number of
calls and discussions with the lead.
P. Inside sales
1. Focus on working remotely with customers from a regional or national
headquarters
Q. Observation – a way a salesperson often can find prospects by constantly watching
what is happening in the sales area
R. Networking: making and using contacts.
1. Goal of cultivating your network is to fill a niche in the mind of each of
your contacts so when one of those contacts, or someone he or she knows,
needs your type of product or service, you are the only possible resource
that would come to mind.
VIII. PROSPECTING GUIDELINES
A. Three criteria in developing the best prospecting method:
1. Customize a prospective method to fit your firm’s needs.
2. Concentrate on high potential customers first.
3. Always call back prospects who didn’t buy.
B. Referrals are used in most prospecting methods:
1. Cold Canvassing
2. Endless Chain-Customer Referrals
3. Orphaned Customers
4. Sales Lead Clubs
5. Public Exhibitions and Demonstrations
7. Telephone
8. Networking
IX. C. The Prospect Pool
1. Group of names gathered from various sources.
2. Four main sources are:
a. Leads
b. Referrals
c. Orphans
d. Your customers
X. THE REFERRAL CYCLE
A. Provides guidelines for when a salesperson should ask for referrals.
B. The parallel referral sale – sells the product plus sells the prospect on providing
referrals.
C. The secret is to ask correctly. Clients frequently object to giving referrals because
they:
1. Are afraid of upsetting friends and relatives.
2. Don’t want friends to think they’re being talked about.
4. Fear the salesperson may not be around years down the road.
5. Don’t feel they can benefit from giving the salesperson referrals.
D. The pre-approach – mention personal contact.
E. The presentation – builds rapport, explains agenda.
F. Product delivery – identifies the precise moment that the product has value for the
customer.
G. Service and follow-up – ongoing opportunities to maintain contact with your
customer.
H. Don’t mistreat the referral.
1. Treat the referral professionally.
I. Always follow through on what you have told the referral.
XI. CALL RELUCTANCE COSTS YOU MONEY
A. About 40 percent of salespeople suffer reluctance at some point.
B. Call reluctance – not wanting to contact a prospect or customer.
C. Comes disguised as a salesperson’s natural tendencies.
D. Countermeasures are numerous and depend on the type of reluctance a salesperson
has.
XII. OBTAINING THE SALES INTERVIEW
A. Key factor in the selling process is obtaining a sales interview
B. Be creative.
C. Persistence pays off.
D. The benefits of appointment making.
1. Ensures an audience with the buyer.
2. Adds to a salesperson’s professional image.
3. Considered a gesture of respect to a prospect.
E. Telephone appointment.
1. Plan or write out what you will say.
2. Clearly identify yourself and your company.
3. Get to the point quickly.
4. Present only enough information to stimulate interest.
5. Be persistent.
6. Ask for an interview.
F. Asking for an appointment by e-mail
1. E-mails offer flexibility to both the salesperson and a prospect.
2. Phrase your appointment request as a question.
G. Make the appointment personally.
1. Believe in yourself – speak and carry yourself as though you expect to get
in.
3. Call at the right time on the right person.
4. Do not waste time waiting.
XIII. Applying CRM Technology to Prospecting
A. CRM system can assist the firm and its salesforce in the prospecting process.
1. Serves as a repository for varying information about potential leads,
provides tools to segment this pool of potential customers, and enables
scoring of these prospects to help the salesperson prioritize her efforts
B. Lead generation and tracking via marketing automation
C. Contact management
1. Central storage area for each prospect’s information
D. Lead scoring
1. Integrate best practices for prospecting and nurturing relations, and it can
share this learning across the organization
E. Pipeline management
1. Goal of pipeline management: understand the potential for business in the
immediate term (current customers) and future term (prospects).
a. Helps salespeople generate reports to better understand the
movement of prospects through the sales process.
XIV. HOW IS PROSPECTING CHANGING?
A. Social selling
1. Any social interaction–enhancing technology that can be deployed by sales
professionals to generate content (e.g., blogs, microblogs, wikis) and
develop networks (e.g., social networks, online communities)
2. InMail, LinkedIn’s internal e-mail system, makes it possible for a sales
representative to e-mail any LinkedIn user without an introduction.
LinkedIn also assists salespeople, as it tracks the users who view your
profile—including potential leads.
B. Social listening
2. Provides means of understanding customer needs and is becoming
increasingly important to integrate into the selling process.