1. Prospecting
Chapter 7

2. Important Questions Answered
 Why is prospecting important for effective selling?
 Are all sales leads good prospects? What are the
characteristics of a qualified prospect?
 How can prospects be identified?
 How can the organisations be identified?
 How can the organisation’s promotional programme be
used in prospecting?
 How can an effective lead qualification and management
system aid a salesperson?
 How can a salesperson overcome a reluctance to a
prospect? 2

3. “The telemarketing aspect of my process can be
frustrating at times because I’ll call prospects
that won’t give me the time of day.”
~Tasha Stulz
Parker Marketing Research
7-3

4. Prospects - Dictionary Meaning
 An apparent probability of advancement, success, profit,
etc.
 The outlook for the future: good business prospects.
 Anticipation; expectation; a looking forward.
 Something in view as a source of profit.
 Potential or likely customer, client, etc.
 A potential or likely candidate.
4

5. THE CONCEPT OF PROSPECTING
 A salesperson without prospects is out of business.
 A salesperson without prospects can no more close a
sale than a surgeon without a patient can operate.
 Presenting a professional appearance, giving an
impressive presentation and closing like a master are
not enough to prevent failure if too little attention is
given to prospecting.
 If your closing ratio is lower than you like, the major
problem may be that you don't have enough good
prospects -- not that you are a poor closer.
 You must have someone to whom to tell your story --
someone who wants to buy and can buy.
 Prospects are everywhere - find the best
5

6. QUALIFYING THE PROSPECT
Moving from a "lead" to a qualified prospect
Lead Just a name
Researched for need, money
Prospect
authority
Qualified Evaluated prospect along with
Prospect personal information
6

7. Relationship Between the Steps in the
Selling Process and the Designation
of the “Buyer”
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8. The Importance of Prospecting
 Many experts believe it is the most important activity a
salesperson does
 It is the process of locating potential customers for a
product or service.
 The world is constantly changing
 More important in some fields than in others
 No salesperson can ignore leads, even in a position
requiring less emphasis on new contacts
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9. Class “A” Prospects
 Referral from a person the prospect respects
 Has the ability to make a buying decision
 Has the ability to pay for the product or service
 You have all the personal information you need to
make a good presentation
9

10. Characteristics of a Good Prospect
 Starts with a Lead, which should be qualified.
 Quite some time is spent; amount of time spent
depends upon the type of sale.
10

11. A qualified prospect is MAD
 He or she has:
 Money to buy
 Authority to buy
 Desire to buy
11

12. Qualify with the MADDEN Test
M oney •Research credit before
A pproachable •Can you get an
appointment
D esire •You may have to create or
discover
D ecision-Maker •Often missed by
salespeople
•May be committed already
E ligible •our company may turn
down
12

13. Questions Asked To Qualify And
Pinpoint A Good Prospect
 Does the lead has a want or a need that my
product/service can satisfy?
 Does the lead have the ability to pay?
 Does the lead have the authority to buy?
 Can the lead be approached favourably?
 Is the lead eligible to buy?
13

14. Does a Want or Need Exist?
 People buy to satisfy tangible as well as practical
needs.
 Sometimes sales are made through creating high
pressure tactics but in this way a potential long-term
customer is lost.
 The lead must want to solve a problem to be
considered a qualified prospect.
14

15. Does the Lead have the Ability to Pay?
 The ability to pay separate Lead from prospects.
 A client is not a real prospect without resources to pay
for the product
 Ability to pay includes both cash and credit
 The client may have a desire to buy but if she/he is
unable to pay, is not a Prospect
15

16. Does the Lead have the Authority to Buy?
 Knowing who has purchasing authority saves the
salesperson time and effort and results in a higher
percentage of closed sales
 It is better to simply ask that person if that person has
the authority to buy.
 Companies also delegate their purchasing tasks to
outside vendors – system integrators
16

17. Can the Lead be Approached
Favourably?
 At times they are very difficult to be approached e.g.
Chief Executives etc that the salespeople do not
consider them as prospects
 Possibility of getting an interview and Chances of
making a sale
17

18. Is the Lead Eligible to Buy?
 Salespeople should be careful in contacting as if the
company sells to wholesalers then only the wholesalers
should be contacted.
 Salespeople should also be careful in locating the
prospects that they should be in their exclusive sales
territories
 Volume
 Status
 Sales territories
18

19. House accounts
 large or potential customers that are handled
exclusively by the corporate executives should not
be contacted by the salespersons
19

20. Other Criteria
 Leads that meet five criteria are generally considered
excellent prospects. At times a few more are added to
the list depending upon the company/item being sold.
 Timing of the purchase
 Long-term customer potential
20

21. Why we lose old customers
 Customer's company goes broke
 Competitor takes your customer
 Customer moves or dies
 Merger or downsizing
 Customer-salesperson relationship deteriorates
21

22. How and Where to Obtain Prospects?
 Satisfied Customers
 Endless-Chain Method
 Centre-of-Influence Method
 Networking
 Promotional Activities
 The Internet
 Inquiries from Advertising and Direct Mail
 Shows
 Seminars
 Lists and Directories
 Canvassing
22
 Spotters

23. How and Where to Obtain Prospects?( contd.
 Telemarketing
 Limitations of Telephone Prospecting
 Tie-in With Other Tools
 Sales Letters
 Other Sources of Leads
23

24. How and Where to Obtain Prospects
– Satisfied Customers (contd.)
Selling deeper
Additional sales to
satisfied customers
Referral events who provide leads.
Gatherings designed
to allow current
customers to
introduce prospects
to the salesperson, to
generate leads. Negative referral
Customer who tells
others about how
poorly you or your
product performed.
7-24

25. Prospecting Methods that Work!
25

26. Telemarketing
 Salesperson uses phone and/or telemarketing staff
to generate leads
 Outbound vs. inbound telemarketing
26

27. The Processing System Within a
Telemarketing Center
27

28. Reports From a Telemarketing
Center to Other Marketing Groups
Within the Firm
28

29. Referrals
 Have referral make the initial contact
 Learn how to ask for a referral
 Get letter of introduction
 Have referral call the prospect
 Referrals tend to be horizontal
29

30. Why people don't give referrals
 Can't think of anyone
 Object to giving referrals
 Time constraint
30

31. Centers of Influence
 Sales person cultivates well-known, influential
people in the territory who are willing to supply
lead information
 Buying community
 Believes in what you are selling
 Is influential with a number of people
 Is willing to give you names
 The names given to you are at least partially
qualified prospects, more than just leads
 May never buy
31

32. Spotters
 Salesperson pays someone for lead information
32

33. Group Prospecting
 Give a brief presentation to a group
 Follow up with interested prospects
 Trade shows
 Speaking engagements
 Seminars
33

34. Seminars
 Salespeople use seminars for prospects to generate
leads
 Appeal to a specialized market
 Invite good prospects
 Go high-quality
 Be involved before, during, and after
34

35. Shows, fairs, and merchandise
markets
 Salespeople use these venues for lead generation
 At many tradeshows all attendees are customers
 Timely follow-up of leads is critical if sales follow a
show
35

36. Planned Cold Calling
 Salesperson tries to generate leads by calling on
totally unfamiliar organizations
 At least one out of seven will be receptive.
 Treat cold calls as a supplement.
 Develop effective, memorable door
 Don't neglect others by too much of this.
 Preplan Cold Calls
 openers
 Limit Waiting
 Fifteen minutes
 Keep busy while waiting
 Remain Enthusiastic 36

37. Direct Mail or Fax
 Prospects do read well targeted direct mail
 Watch quality of purchased lists
 Create your own newsletter
 Mailing is good and Cheap
 Postcard pack
 Bounce-back card
37

38. Sales letters
 Salesperson writes personal letters to potential
leads
 Follow up with a telephone call
 Include promotional items
38

39. Internet
 Salesperson uses websites, e-mail, listservers,
bulletin boards, forums, roundtables, and
newsgroups to secure leads
 Extranets
 E-selling
39

40. Ads, catalogs, and publicity
 Salespeople use these forms of promotional
activities to generate leads
40

41. Joining Civic Groups
 Assume leadership responsibilities
 Become highly visible
 Set contact goals for each club meeting
 Keep files on each contact made
 Use "re-meet " goals to help you develop closer
relationships
 Reach out to new members
 Use active listening
 Look for sales opportunities
41

42. Networking - active cooperation
 There are formal groups that you can join
 Sharing information makes good sense
 Salesperson uses personal relationships with those
who are connected and cooperative to secure leads
 Suggestions:
 Call at least two people per day and go to at least one
networking event every week
 Spend most of your initial conversation with a new contact
talking about his or her business and learn about the
person’s nonbusiness interests
 Follow up with your new contact on a regular basis
42

43. Endless chain
 Salesperson attempts to secure at least one
additional lead from each person he or she
interviews
 Referred lead
43

44. Example: Endless-Chain Method
7-44

45. Using Directories
 Salespeople use secondary data sources, which can
be free or fee-based
 Purchasing lists
 Sales and Marketing Management - buying power
index
 Moody's Industrial Manual
 Poor's Register of Directors and Execs
 The Dun and Bradstreet Reference book
 The Thomas register of American Manufacturers
 Contacts Influential 45

46. Observation
 Prospects are everywhere
 Always be looking
 Read the news
 Trade journals
46

47. Other sources of leads
 Salesperson uses noncompeting salespeople,
people in his or her own firm, friends, and so on, to
secure information
 Government agencies
47

48. Company Initiated Prospecting
•Telephone
•Human calls
Telemarketing
•Computer generated calls
•Fewer leads
•Lower cost
•Direct mail
Advertising
•Newspaper
•Other media
Past Customers
•Go over list of inactive accounts
•Selecting the right show
•On the spot vs. lead generation
•Display planning
Trade Shows •Staffing the booth
•Pre show training
•Getting high visibility
•Managing information collected at show
•Planning follow up
•For Prospecting
Web Sites
•Streamline the sales process
48
•Joint marketing with other firms

49. MANAGING PROSPECT
INFORMATION
Initial Recording of Leads
1.Record all basic information
2.If you don't have a computer then use index cards
Classification of Prospects
1. A simple method for manual systems
a.Class A - You have enough information to make a presentation
b.Class B - You need more information to make a presentation
c.Class C - a "lead" you don't know much more than the name
2.Sophisticated, multi dimensional classifications can be done with a computer
Scheduling Contacts
1.Contact prospects using a prioritized list
2.Keep a tickler file. 49

50. USING TECHNOLOGY TO
MANAGE PROSPECT
INFORMATION
Personal Databases
Corporate Databanks
Improving
•Salespeople now have access to the most current
Communications
information
50

51. Lead Qualification and Management
Systems
 The process developed by the salespeople for
qualifying leads is called Lead Qualification System
 The process of analysing the relative value of each lead
is called Lead Management System
 Prequalification
 Analyzing lead value
 Evaluating profitability of sales resulting from lead-
generating activities
51

52. Overcome a Reluctance to Prospect
 Salespeople usually face a natural reluctance to prospects.
Reasons for this may be one or several out of the following
 Worrying about the worst-case scenarios
 Spending too much time preparing
 Being overly concerned with looking successful etc.
 Being fearful of
 Making group presentations
 Appearing too pushy
 Losing friends or family approval
 Using the phone for prospecting
 Feeling intimidated by people with prestige or power, o
feeling guilt at having a career in selling
 Having a compulsive need to argue, make excuses, or
blame others
52

53. Helpful activities to Overcome a
Reluctance to Prospect
 Helpful activities
 Identify and evaluate excuses not to call
 Engage in sales training and role-playing activities
 Make prospecting contacts with a supporting partner or sales
manager
 Set specific goals for all of your prospecting activity
 Realize the economic value of most prospecting activities
 Stop negative self-evaluation from ruling your behavior
 Remember that you are calling on prospects to solve their needs
 Control your perceptions of what prospects might say about you,
your company, or your products
 Learn and apply relaxation and stress-reducing techniques
 Recount your own prospecting successes, or those of others
53

54. Reasons for Call Reluctance
Yielder
• Fears intruding on others or being pushy.
Overpreparer • Overanalyzes
• Underacts.
Emotionally unemancipated • Fears loss of family approval
• Resists mixing business and family.
Separationist • Fears loss of friends
• Resists prospecting among personal friends.
Hyper-Pro • Obsessed with image
• Fears being humiliated.
Role rejecter
• Ashamed to be in sales.
Socially self-conscious
• Intimidated by upmarket customers.
Doomsayer Worries, won’t take risks.
Telephobic
• Fears using the telephone for prospecting or selling.
Stage fright
• Fears group presentations.
Referral aversions
• Fears disturbing existing business or client relationships.
Oppositional reflex 54
• Rebuffs attempts to be coached.

55. Summary
 Locating prospective customers is the first step in
the sales process.
 Not all sales leads qualify as good prospects.
 Many methods can be used to locate prospects.
 The best source is a satisfied customer.
 Effective prospecting requires a strong plan that
hinges on developing a lead qualification and
management system and overcoming reluctance to
prospect.
7-55

56. End of Chapter 7

57. Thank you