4. SALES OF PRODUCT IDEAS & NEW PRODUCTS
4.2 E ARLY MARKET CONTACTS IMPORTANT
Selling is something many people do not like to do e.g. as they often have negative experiences of someone who have sold things to them that they did not need.
However, to be successful with selling a product is more a question of selling a good story than hard-selling the product. To bear in mind is also that “People LOVE to BUY, but HATE being sold".
To be able to get the first order the salesman has first to learn about the product idea or the product and its background. She/he must be excited about it, make a convincing story, and then tell the story to other people she/he meets – one never knows who will be a customer! Start telling a little bit of the story, then shut up and wait for some comments or questions. If there is no such feed-back, tell a little more and shut up again. If there is no feed-back on this second try, either the person is not interested or you tell the wrong story. Therefore, modify the story and test it on the next person.
When you, sooner or later, have got the first order, you know what selling points were useful. However, for the next order you often need to adjust the message and add information. Having got a number of orders you can start to make supporting marketing material. Using the web pages means that the message can be changed every time new knowledge has been gained until a stable situation has been reached and it is meaningful to print nice brochures. Not to be too turned down in the early
Sales Team
After Market (service, follow ups) Prospecting
(market studies, potential customer investigations)
Distributors
(contracting, evaluating, supporting)
Sales
(demonstrations & sales)
Customers (offers, orders, deliveries, invoicing) Sales Support (sales support,
training, e-sales) Assistant
(follow ups, reports)
Sales Team
After Market (service, follow ups) Prospecting
(market studies, potential customer investigations)
Distributors
(contracting, evaluating, supporting)
Sales
(demonstrations & sales)
Customers (offers, orders, deliveries, invoicing) Sales Support (sales support,
training, e-sales) Assistant
(follow ups, reports)
selling process, it is good to practice your stories on a friend or relative before you test on unknown people.
Thus, the first order is often the most difficult one to close, and the less developed the product is, the greater the achievement. At the same time, the prospects for the future of a new business venture are best by far if at the concept stage one succeeds in selling the product to a customer who preferably is also to be the user of the product.
User influence is thereby automatically built into the product, and the more demanding this user is, the better it is for the development work. This is because a demanding user forces the development to be adapted to the product that has already been sold, which prevents ”over-elaboration”. This is on condition that the product developers are not isolated from the user(s) of the product – which unfortunately is not uncommon in the industry.
The difficulties that lie ahead when selling at the concept stage are both of a technological and of a market technical (psychological) nature (we will come back to the term concept). An early order then gives knowledge about the user/usage, but also a psychological lift, which means that life seems easier to the entrepreneur, the company and to others involved in the business. The business has thereby acquired an initial commercial base, in the shape of at least one actual customer. It is important to point out in this context that for both ethical/moral and practical reasons it is wrong to sell a product with whose technology one is not familiar. For example, to sell on the black market cancer medicine which is not tested and approved but which is based on faith in how the medicine would be able to work is highly unethical, illegal and detrimental to one’s own reputation.
The tactics of selling a product at the concept stage, i.e. before its product development has started, can seem bold to many. Nonetheless it is a fairly common method that is often used by small enterprises that lack the financial strength to develop the product first. In certain sectors it is also usual to sell development assignments that one can use for the development of one’s own products and which the customer then can benefit from in the form of royalties on units sold to other buyers. This approach is often used for military products and systems.
If the product cannot or should not be sold at the concept stage, the goals should be to sell it as soon as there is a functioning prototype or series zero product to show. This prevents the risk of too much technological development without customer/user contact. The worst situation arises if sales of the product do not begin until it is fully developed and adapted for production. The greatest probability is that the wrong product will be developed with the wrong design and wrong properties if customer contacts occur this late in the development process. Note also that experience says that a user or user group that tests the product and perhaps also takes part in development, but does not make any financial commitment, in general does not provide as good input values to the product developers as when the group or someone whom the group represents additionally has made some financial commitment. The explanation is that when it costs nothing it is easy to have views that one then need
not answer for when actually paying for the product.
The first order always means that the salesperson has succeeded in expressing the customer benefits of the product and managed to develop up a selling story, which in turn indicates that it should be possible to sell the product to other customers. The more conceptual the product has been upon the sale, the higher the expectations in the new product. Above all therefore it is important in development to ensure that the functional values are at an acceptable level, i.e. that functionality exceeds a minimum level. The product must correspond at least to what are called basic properties or expected properties (Kano et al., 1996). These properties are often not mentioned by the customer, since they are to be considered as self-evident. For example, a car must have wheels and brakes.
The basic properties are often referred to as expected requirements. When a product meets such tacit demands, it does not mean that the customer/user becomes more satisfied with the product or company. However, there will be great disappointment if the product does not have the basic properties. Therefore it is important that the person who sells the product ensures that development takes place in such a way that the basic properties are secured. If this does not happen, then sales will be considerably more difficult, due to the negative publicity about the product that will be spread.
The next level of demands that the seller must ensure reasonable compliance with is the normal requirements, since these correspond to the price that the customer has accepted for the product. Examples of normal requirements for a car – to take a product example everyone is familiar with - are acceleration performance, fuel consumption, quality and reliability. The customer/user often expresses wants about the normal requirements, and the better the normal requirements meet expectations, the greater the customer’s/user’s satisfaction. At the same time, the normal requirements mean increased costs in proportion to how extreme they become.
Therefore the seller must also moderate the extent of the price-raising activities that often occur if the product developers and customers together are given carte blanche for interaction.
There is also a third level as regards expectations. This concerns exciting requirements and is a response to the customers’/users’ tacit or unconscious wishes and demands. Unlike expected requirements, the exciting requirements are not taken for granted, but constitute positive and unexpected surprises for the customer when the product is delivered. These exciting values can be represented by simple and low-cost services and items such as for example the customer finding a bottle of wine on the back seat of a new car with a congratulatory message on the new purchase, the discovery that the fuel tank is full or that there is free recovery insurance. It is in the interests of the seller to ensure that some exciting requirements are included with the product upon delivery, since they contribute to the customer spreading favorable assessments, among the customer’s circle of acquaintances.