selling

1. Prospecting
Dr. Gopal Thapa
Tribhuvan University
Email: thapazee@gmail.com

2. Meaning of Prospecting
Prospecting is the first step in the selling
process. It is the activity of seeking out
Potential Customers.
Dictionary of Marketing

3. Importance of Prospecting
 Prospecting begins the process of converting
prospects into repeat customers.
 A suspect is a potential prospect
 Many suspects will not become prospects
because they have no real need for product.
 If a salesperson determines the suspect has
a real need for the product, then the person
or organization becomes a prospect.
 They must have the need for salesperson's
product

4. Importance of Prospecting
 Salesperson should qualify the prospect to
find out if that person has both the ability
authority to purchase.
 Once a qualified prospect is located, the
selling process begins.
 The sales process does not end with the first
order that convert the customer into a repeat
customer.
 Both customers and repeat customers can be
sources of new prospects

5.  Having a list of prospects is critical to the
success of both experienced and new
salespeople.
 For this reason, acquiring prospects is a
continuing process.
 Today extensive changes are taking place in
population movements, in creation of new
business and product, in shifting of business
to new lines, in expansion of old lines
companies and in methods or channel of
distribution.
Importance of Prospecting

6. Importance of Prospecting
 It is estimated these changes result in a 15 to
20% annual turnover of customers.
 Unless a company has a steady flow of new
prospects, it will soon be out of business.
 Prospecting is more important in some selling
fields than in others
 Eg. Life insurance or real state business who
does not have an effective prospecting plan,
does not last long in the business.

7. Importance of Prospecting
 No one with an ample supply of good
prospects ever left the life insurance
business. As long as the human heart keeps
pumping blood through the veins, a person
continues to live despite all infirmities. As long
as prospecting keeps pumping a supply of
names, a person continues in the life
insurance business.
New York Life Insurance Company

8. Importance of Prospecting
 General Rule of Prospecting
It takes 100 suspects:
• To get 50 prospects
• To have an opportunity to make 25 presentations
• Which will result in 12 sales
 Prospecting is important even for sales
people in high technology products
 A recent survey of computer sales people
found that: reps who had sale of more than
150% of quota did more prospecting than
lower performing sales people.

9. Importance of Prospecting
 To generate leads, they relied heavily on
referrals, business related articles in
newspapers and trade journals, civic meeting
and cocktail parties.
 In retail selling, most of the prospecting is
done through advertising.
 Sales people who can go out and get their
own prospects have an advantage over retail
sales people who must wait for customers to
come into the store.

10. Importance of Prospecting
 Some retailers, such as appliance dealer,
recognize the importance of an aggressive
prospecting system by having sales people
call at homes to demonstrate and sell their
products.

11. Characteristics of a Good Prospects
 Does a want or need exist?
 Does the prospect have the ability to buy?
 Does the prospect have the authority to buy?
 Can the prospect be approached favorably?
 Is the prospect eligible to buy?

12. How and Where to Obtain Prospects?
 Inquiries
 Endless chain method
 Center of influence method
 Public exhibitions, demonstrations and trade
shows
 Lists
 Friends and acquaintances
 Cold canvas method
 Others

13. Inquiries
 Use of advertising, telephone calls and
catalogues
 Firm should develop the good system of
recording inquiries.
 Record book is made available to
salespersons.
 A record of such inquiries are maintained also
at firm level.

14. Endless chain method
 Salesperson try to get at least one additional
prospect from each person they interview.
 Very effective in the sale of intangible
products such as educational course,
insurance etc.

15. Center of influence method
 Use of well-known influential person

16. How to get the most out of the
prospecting (Qualify & Evaluate
Prospects)
Many companies conduct extensive marketing
research to determine what distinguishes a
good prospects
For example: New York Life Insurance Co.
(Use of evaluation formula based on six factor)
age, number of dependent, appropriate
income, acquaintance, accessibility and
economic status (each prospect is given point
on each of six factor)

17. Qualify & Evaluate Prospects
 Other companies use additional methods to
qualify prospects
 Questionnaires can also be used
 Findings are used to qualify prospects
 It is essential to make an effort to segregate
prospects so the maximum amount of time
can be spent making sales presentations to
prospects who are likely to purchase.

18. Have an organized prospecting plan
 The person who does not have an orderly
prospecting plan is a slave to confusion,
frustration and chaos.
 Inexperienced salespeople frequently rattle
around in the territories, jump from one spot
to another and waste considerable time
between calls.
 Successful and experienced sales
representatives, on the other hand, almost
always have efficient systems for recording,
studying, and using their prospect information

19. Keep good records
 Keeping records of prospects require an
efficient system in the organization.
 Most large companies have developed
prospecting system and standard prospects
card so that the sales representative have the
necessary information available on each
prospects.
 This system includes: master file, friends and
acquaintances file, centre of influence file and
district or zonal file

20. Set quotas
 Most effective prospecting plans include weekly and
monthly quotas for new prospects.
 In the long run, goals for obtaining the names of new
prospects are just as profit and sales goals.
 The continuous profitable operation of a territory
depends on a steady flow of new prospects.
 Quotas remind the salesperson of the importance of
keeping a constant lookout for new names to fill the
prospects pipeline.

21. Evaluate Results
 One of the greatest dangers in prospecting is
the tendency to “ease off” in locating new
prospects as soon as the prospect file
contains a substantial number of names.
 Names alone are not enough.
 Prospect files must be checked periodically to
eliminate the deadwood and to make sure the
best possible factors are being used to
evaluate prospects.

22. Experiment with new methods
 Present system is not producing enough
prospects or the right kind of prospects.
• Other methods are:
❖ Cold canvas
❖ Centre of influence
❖ Endless chain etc.

23. Follow-through
 One of the most common complaints from
sales manager is that sales people do not
follow through on prospect leads
 The sales person may call a prospects
several times without getting any positive
action.
 He or she must then use judgment as to
whether the prospect merits additional time
and effort.

24. Follow-through
 Too frequent calls may cause the prospect
resentful and thus kill all possibilities of a sale
 The salesperson needs judgment, tact,
diplomacy, persistency, and ingenuity to know
the exact extent to which he or she should
follow through.
 This skill is gleaned from actual selling
experince.