TestBank for Fundamentals of Selling 13th edition Futrell TB _Fundamentals of selling 13e Futrell TB

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TestBank for Fundamentals of Selling 13th edition Futrell TB _Fundamentals of selling 13e Futrell TB TestBank for Fundamentals of Selling 13th edition Futrell TB _Fundamentals of selling 13e Fut... rell TBChapter 01 - The Life, Times, and Career of the Professional Salesperson 1-1 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Chapter 01 The Life, Times, and Career of the Professional Salesperson Learning Objectives: 01-01 Define and explain the term selling. 01-02 Explain why everyone sells, even you. 01-03 Explain the relationship between the definition of personal selling and the Golden Rule of Personal Selling. 01-04 Discuss the reasons as to why people might choose a sales career. 01-05 Enumerate some of the various types of sales jobs. 01-06 Describe the job activities of salespeople. 01-07 Define the characteristics that salespeople believe are needed for success in building relationships with customers. 01-08 List and explain the 10 steps in the sales process. True / False Questions 1. Selling and marketing are interchangeable terms for the same business activity. Answer: False Learning Objective: 01-01 Topic: What Is Selling? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Selling is a marketing component that refers to the personal communication of information to persuade a prospective customer to buy something. Marketing is an organizational function and a set of processes for creating, communicating and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders. 2. According to recent Gallup surveys, most Americans believe that traditional salespeople are overly interested in the needs of customers. Answer: False Learning Objective: 01-03 Topic: The Golden Rule of Personal Selling Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: As Gallup’s survey poll of Americans indicates, people view traditional salespeople as having their self-interest as a priority. This type of salesperson is preoccupied with his or her own well-being—usually defined in terms of making money—and thus is selfish and cannot be trusted.Chapter 01 - The Life, Times, and Career of the Professional Salesperson 1-2 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 3. Personal selling refers to the personal communication of information to unselfishly persuade a prospective customer to buy something that satisfies that individual's needs. Answer: True Learning Objective: 01-01 Topic: A New Definition of Personal Selling Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Personal selling refers to the personal communication of information to unselfishly persuade a prospective customer to buy something—a good, a service, an idea, or something else—that satisfies that individual’s needs. 4. The Golden Rule of Personal Selling describes the willingness to plan and execute product, price, distribution, and promotion plans so as to create exchanges that satisfy individual and organizational objectives. Answer: False Learning Objective: 01-03 Topic: The Golden Rule of Personal Selling Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The Golden Rule of Personal Selling refers to the sales philosophy of unselfishly treating others as you would like to be treated. Reciprocity is not expected. 5. As a salesperson’s self-interest decreases, a salesperson’s interest in providing customer service is more likely to increase. Answer: True Learning Objective: 01-03 Topic: The Golden Rule of Personal Selling Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: As interest in serving others improves, a person’s self-interest lessens. The more the salesperson considers the customer’s interest, the better the customer service.Chapter 01 - The Life, Times, and Career of the Professional Salesperson 1-3 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 6. An employee at a fast-food restaurant who asks the manager for a raise is engaged in the selling process. Answer: True Learning Objective: 01-02 Topic: Everybody Sells! Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: You are involved in selling when you want someone to do something. Therefore, an employee persuading a manager for a raise is in the process of selling. 7. Unlike traditional and Golden Rule salespeople, professional salespeople have a tendency to attribute sales success to others rather than to their own actions. Answer: False Learning Objective: 01-03 Topic: The Golden Rule of Personal Selling Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Golden Rule salespeople tend to attribute positive results to others rather than to their own personal efforts. Professional salespeople attribute results to personal efforts as well as to their employer, customers, and the economy. 8. Golden Rule salespeople tend to believe that money is to be shared and that customer service is a top priority. Answer: True Learning Objective: 01-03 Topic: The Golden Rule of Personal Selling Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Golden Rule salespeople are customer-focused, so customer service is important. Money is not the main motivation of Golden Rule salespeople, so money should be shared.Chapter 01 - The Life, Times, and Career of the Professional Salesperson 1-4 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 9. A retail salesperson sells goods or services to consumers for personal and business use. Answer: False Learning Objective: 01-05 Topic: Why Choose a Sales Career? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A retail salesperson sells goods or services to consumers for their personal, nonbusiness use. Retailers do not sell goods or services for business usage. 10. A customer contact person performs the same tasks as a salesperson. Answer: True Learning Objective: 01-05 Topic: Why Choose a Sales Career? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Each customer contact person takes your money and provides a good or service in return. Customer contact person is another name for a salesperson. Although the title may be different, their job is the same—to help you buy. 11. Direct sellers sell face-to-face to consumers who use the products for their personal use. Answer: True Learning Objective: 01-05 Topic: Why Choose a Sales Career? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Direct sellers sell face-to-face to consumers—typically in their homes—who use the products for their personal use. 12. A wholesale salesperson would sell athletic shoes to a sporting goods store which in turn would resell the shoes to individual customers. Answer: True Learning Objective: 01-05 Topic: Why Choose a Sales Career? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Wholesalers (also called distributors) buy products from manufacturers and other wholesalers and sell to other organizations. A wholesale salesperson sells products, such as shoes, to resellers, such as sporting goods stores.Chapter 01 - The Life, Times, and Career of the Professional Salesperson 1-5 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 13. A detail salesperson concentrates on directly soliciting orders. Answer: False Learning Objective: 01-06 Topic: Why Choose a Sales Career? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A detail salesperson concentrates on performing promotional activities and introducing new products rather than directly soliciting orders. The medical detail salesperson seeks to persuade doctors, the indirect customers, to specify a pharmaceutical company’s trade name product for prescriptions. 14. The role of a service salesperson is selling the benefits of intangible products such as financial services. Answer: True Learning Objective: 01-06 Topic: Why Choose a Sales Career? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A service salesperson must sell the benefits of intangible or nonphysical products such as financial, advertising, or computer repair services. Services, like goods, are either technical or nontechnical in nature. 15. Order-getters ask what the customers want or wait for customers to place an order. Answer: False Learning Objective: 01-06 Topic: Why Choose a Sales Career? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Order-takers may ask what the customer wants or wait for the customer to order. They do not have a sales strategy and often use no sales presentation. Order-getters get new and repeat business using a creative sales strategy and a well-executed sales presentation.Chapter 01 - The Life, Times, and Career of the Professional Salesperson 1-6 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 16. Jobs such as inside retail sales and outside delivery are typically performed by ordergetters. Answer: False Learning Objective: 01-06 Topic: Why Choose a Sales Career? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Inside retail sales and outside delivery are tasks performed by order-takers. Order-getters are involved with more complex tasks that require creative sales strategies. 17. A divisional sales manager has a higher ranking in most firms than a regional sales manager. Answer: True Learning Objective: 01-05 Topic: Why Choose a Sales Career? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: In the sales personnel career path, a divisional sales manager is one rank higher than a regional sales manager. 18. Nonfinancial rewards given by the company are referred to as commissions. Answer: False Learning Objective: 01-04 Topic: Why Choose a Sales Career? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Sometimes called psychological income or intrinsic rewards, nonfinancial rewards are generated by the individual, not given by the company. You know the job has been done well—for instance, when you have helped the buyer through the purchase of your product. Commissions are financial rewards given to salespeople.Chapter 01 - The Life, Times, and Career of the Professional Salesperson 1-7 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 19. Given that sales jobs offer higher nonfinancial rewards than most other areas of corporate America, the compensation of salespeople is typically lower than that of workers in areas like production who are at a comparable level in the organization. Answer: False Learning Objective: 01-04 Topic: Why Choose a Sales Career? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Both corporate and field sales managers typically receive higher salaries than others (such as production, advertising, product, or personnel managers) at the same organizational level. In many cases, the higher the sales position, the greater the benefits offered. 20. Financial rewards for professional salespeople are commonly solely based on performance. Answer: True Learning Objective: 01-04 Topic: Why Choose a Sales Career? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Many are attracted to selling because in a sales career financial rewards are commonly based solely on performance. Many professional salespeople have opportunities to earn large salaries. 21. According to the typical sales personnel career path, the first managerial level job that a salesperson can expect to earn is that of regional sales manager. Answer: False Learning Objective: 01-04 Topic: Why Choose a Sales Career? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: On the sales personnel career path, the first management position is district sales manager. Regional sales manager is one level up from district sales manager.Chapter 01 - The Life, Times, and Career of the Professional Salesperson 1-8 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 22. Top salespeople speak the other person's language, both in verbal and nonverbal communication. Answer: True Learning Objective: 01-07 Topic: Success in Selling—What Does It Take? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Great salespeople are great communicators. Top salespeople speak the other person’s language, both in verbal and nonverbal communication. 23. In order to build long-term relationships with customers, salespeople need to present adequate information to buyers and apply enough pressure to ensure quick sales. Answer: False Learning Objective: 01-07 Topic: C—Characteristics for the Job Examined Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The salesperson’s job is to present the necessary information for the buyer to make an educated decision. Patience rather than pressure in closing the sale goes a long way toward building a long-term relationship. 24. Self-control refers to a salesperson's intelligence, product knowledge, and discipline rather than to emotions, passions, and desires. Answer: False Learning Objective: 01-07 Topic: C—Characteristics for the Job Examined Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Self-control concerns a salesperson’s emotions, passions, and desires. Selfcontrol refers to the discipline needed to prepare for sales presentations and be patient with customers; however, it does not relate to intelligence or product knowledge.Chapter 01 - The Life, Times, and Career of the Professional Salesperson 1-9 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 25. Emotional self-control is difficult for many salespeople to develop because of personal and financial investments in making sales to customers. Answer: False Learning Objective: 01-07 Topic: C—Characteristics for the Job Examined Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Self-control is the most difficult trait for a salesperson to develop. Self-control involves restraining emotions, passions, and desires for self-gain even when the salesperson must sell to make a living. There is considerable incentive for the salesperson to use pressure or lie, for example, to compel the customer to buy something that may not be needed or that is falsely represented. 26. An outside salesperson operates with less direct supervision compared to other employees in an organization. Answer: True Learning Objective: 01-05 Topic: Sales Jobs Are Different Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Other employees usually work under close supervisory control, whereas the outside salesperson typically operates with little or no direct supervision. 27. The acronym ABCS represents the tools needed for creating a successful marketing mix. Answer: False Learning Objective: 01-07 Topic: Relationship Selling Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The letters ABCS stand for analyze, benefits, commitment, and service, which are the four main elements in the customer relationship process used by salespeople to build long-term relationships. 28. Salespeople should avoid providing information to their companies or customers about competitors' activities or market opportunities since such actions violate client confidence and are considered unethical. Answer: False Learning Objective: 01-06 Topic: What Does a Professional Salesperson Do? Blooms: Understand AACSB: AnalyticChapter 01 - The Life, Times, and Career of the Professional Salesperson 1-10 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: Salespeople should provide information to their companies on such topics as competitors’ activities, customers’ reactions to new products, complaints about products or policies, market opportunities, and their job activities. Salespeople are a vital part of their employers’ information retrieval system and such actions are expected and ethical. 29. A salesperson’s conceptual skills allow the salesperson to see the selling process as a whole and the relationship among its parts. Answer: True Learning Objective: 01-06 Topic: The Future for Salespeople Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Conceptual skill is the cognitive ability to see the selling process as a whole and the relationship among its parts. Conceptual skill involves the seller’s thinking and planning abilities. It involves knowing where one’s product fits into the customer’s business or how the beginning of a sales presentation relates to asking for the order. 30. Conceptual skills are especially important for the creative order-getters. Answer: True Learning Objective: 01-06 Topic: The Future for Salespeople Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Conceptual skill is the cognitive ability to see the selling process as a whole and the relationship among its parts. Although all sellers need conceptual skills, they are especially important for the creative order-getters. 31. E-selling is limited to sales made through the use of Web sites. Answer: False Learning Objective: 01-06 Topic: The Future for Salespeople Blooms: Understand AACSB: Technology Level of Difficulty: Medium Explanation: E-selling is not limited to Web site sales. E-selling involves using technology to improve the selling process and enable salespeople to service their customers better.Chapter 01 - The Life, Times, and Career of the Professional Salesperson 1-11 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 32. Salespeople do not need increase sales in old accounts if they are generating a sufficient quantity of new customers. Answer: False Learning Objective: 01-06 Topic: The Future for Salespeople Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A company’s sales each period come from two groups: new customers and repeat customers. It always costs more to attract new customers than to retain current customers. Therefore, customer retention is more critical than customer attraction. 33. The sales process refers to the checklist salespeople use to prepare for addressing prospects' objections. Answer: False Learning Objective: 01-08 Topic: Building Relationships through the Sales Process Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The sales process refers to the salesperson’s sequential series of actions that leads toward the customer taking a desired action and ends with a follow-up to ensure purchase satisfaction. This desired action by a prospect is usually buying, which is the most important action. 34. Acts such as building rapport, uncovering needs, and designing sales presentation strategies are collectively referred to as prospecting. Answer: False Learning Objective: 01-08 Topic: Building Relationships through the Sales Process Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Prospecting is the first step in the sales process. Prospecting refers to determining the person or organization that could be a potential customer. Building rapport and uncovering needs occur later in the sales process during the approach stage.Chapter 01 - The Life, Times, and Career of the Professional Salesperson 1-12 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 35. The final step in the selling process is customer follow-up. Answer: True Learning Objective: 01-08 Topic: Building Relationships through the Sales Process Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The last step in the 10-step sales process is customer follow-up and service. This step ensures a positive and long-lasting customer relationship. Multiple Choice Questions 36. Surveys have found that salespeople are rated low on ethics and honesty. What is the most likely reason for such results? A. People believe products are overpriced. B. People lack trust and confidence in sales personnel. C. People perceive that salespeople sell low quality goods. D. Salespeople are unable to encourage impulsive buying during sales calls. E. Most firms lack sales forces that have adequately qualified and trained personnel. Answer: B Learning Objective: 01-03 Topic: The Golden Rule of Personal Selling Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: As Gallup’s survey poll of Americans indicates, people view traditional salespeople as having their self-interest as a priority. This type of salesperson is preoccupied with his or her own well-being—usually defined in terms of making money—and thus is selfish and cannot be trusted. 37. _____ is traditionally defined as the personal communication of information to persuade a prospective customer to buy something which satisfies that individual's needs. A. Marketing B. Personal selling C. Public relations D. Advertising E. Promotion Answer: B Learning Objective: 01-01 Topic: What Is Selling? Blooms: Remember AACSB: AnalyticChapter 01 - The Life, Times, and Career of the Professional Salesperson 1-13 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: In business, a traditional definition of personal selling refers to the personal communication of information to persuade a prospective customer to buy something—a good, service, idea, or something else—that satisfies that individual’s needs. This definition of selling involves a person helping another person. 38. Unlike the traditional definition of personal selling, the new definition: A. relates personal selling more closely to transactional marketing. B. identifies electronic selling as the most effective channel. C. stresses the importance of being unselfish in selling. D. excludes telemarketing activities due to ethical concerns. E. substitutes the word "relationship marketing" for "personal selling." Answer: C Learning Objective: 01-03 Topic: A New Definition of Personal Selling Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The new definition inserts the word unselfish into the traditional definition of personal selling. Personal selling refers to the personal communication of information to unselfishly persuade a prospective customer to buy something—a good, a service, an idea, or something else—that satisfies that individual’s needs. 39. The _____ refers to the sales philosophy of unselfishly treating others as you would like to be treated. A. Equity Sales Theory B. Reciprocity Principle C. 80/20 Principle of Sales D. ABCS Rule of Salesmanship E. Golden Rule of Personal Selling Answer: E Learning Objective: 01-03 Topic: The Golden Rule of Personal Selling Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The Golden Rule of Personal Selling refers to the sales philosophy of unselfishly treating others as you would like to be treated. Reciprocity is not expected.Chapter 01 - The Life, Times, and Career of the Professional Salesperson 1-14 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 40. The Golden Rule of Personal Selling refers to the sales philosophy of: A. unselfishly treating others as you would like to be treated. B. giving more importance to sales maximization than profit maximization. C. making sales mutually beneficial to the buyer and seller. D. obtaining a financial benefit by helping others. E. realizing a major part of the profit from only a few customers. Answer: A Learning Objective: 01-03 Topic: The Golden Rule of Personal Selling Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The Golden Rule of Personal Selling refers to the sales philosophy of unselfishly treating others as you would like to be treated. 41. Anderson is a used cars salesperson, and he believes in the Golden Rule of Personal Selling. He would most likely believe that: A. profit maximization is the ultimate goal of business. B. an action is acceptable if it is legally correct. C. salespeople should be driven by pride and achievements. D. money and long-term customer loyalty are essential. E. positive sales results are to be attributed to other people. Answer: E Learning Objective: 01-03 Topic: The Golden Rule of Personal Selling Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: A Golden Rule salesperson attributes personal success to others. Traditional salespeople are more focused on money, profits, and person accomplishments than on customer relationships and ethics. 42. A salesperson that adheres to the Golden Rule of Personal Selling: A. is primarily motivated by money. B. is driven by pride and recognition. C. focuses on laws rather than morals. D. finds others' interests most important. E. requires intensive monitoring from managers. Answer: D Learning Objective: 01-03 Topic: The Golden Rule of Personal Selling Blooms: Understand AACSB: AnalyticChapter 01 - The Life, Times, and Career of the Professional Salesperson 1-15 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: The Golden Rule of Personal Selling refers to the sales philosophy of unselfishly treating others as you would like to be treated. A Golden Rule Salesperson attributes results to others and strives to be moral rather than only meet legal requirements. 43. Which of the following is most likely a characteristic of traditional salespeople? A. Building long-term relationships with customers B. Making legal and ethical decisions C. Focusing exclusively on customer service D. Finding others’ interests more important than their own E. Seeking recognition for their efforts Answer: E Learning Objective: 01-03 Topic: The Golden Rule of Personal Selling Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Traditional salespeople tend to seek personal recognition and focus mostly on money and recognition. A Golden Rule Salesprson will build relationships with customers and focus on excellent service. 44. Which of the following is the logical order of salespeople from high to low levels of selfinterest? A. Golden Rule, traditional, professional B. traditional, Golden Rule, professional C. professional, traditional, Golden Rule D. Golden Rule, professional, traditional E. traditional, professional, Golden Rule Answer: E Learning Objective: 01-03 Topic: The Golden Rule of Personal Selling Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Traditional salespeople are motivated by money and recognition, so they have the highest degree of self-interest followed by professional salespeople and Golden Rule salespeople. A Golden Rule salesperson has the least amount of self-interest and is guided by a desire to help customers and attribute success to others.Chapter 01 - The Life, Times, and Career of the Professional Salesperson 1-16 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 45. In which of the following situations is the individual NOT actively engaged in selling? A. Steve is trying to convince his professor that he deserves an "A." B. Brendan is persuading Marilyn to loan him $10, so he can order a pizza. C. Chad is trying to convince his biology lab partner to sketch the internal organs of the frog they dissected in lab. D. Anna is trying to persuade her husband to attend her family reunion. E. Daniel is creating a logo for his home-based Web services company. Answer: E Learning Objective: 01-02 Topic: Everybody Sells! Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: From an early age, people develop communication and persuasion techniques for trying to get their way in life, such as trying to convince others for a loan or a better grade. No persuasion is involved in creating a logo. 46. The person who telephoned James last night to ask him if he was interested in adding HBO and Cinemax to his current television cable system would be classified as a(n): A. relationship seller. B. retail salesperson. C. order-taker. D. account representative. E. sales engineer. Answer: B Learning Objective: 01-05 Topic: Why Choose a Sales Career? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A retail salesperson sells goods or services to consumers for their personal, nonbusiness use, such as extra cable channels. Three common types of sellers who sell at retail are the (1) in-store salesperson, (2) direct seller who sells face-to-face away from a fixed store location, and (3) telephone salesperson.Chapter 01 - The Life, Times, and Career of the Professional Salesperson 1-17 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 47. The person behind the counter at McDonald's who enters your order, takes your money, and hands you your food is a(n): A. retail salesperson. B. sales executive. C. order-getter. D. direct salesperson. E. account representative. Answer: A Learning Objective: 01-05 Topic: Why Choose a Sales Career? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A retail salesperson sells goods or services to consumers for their personal, nonbusiness use. The cashier at McDonalds is a retail salesperson. 48. Donna Carter goes from house-to-house in her neighborhood taking orders for Pampered Chef kitchen products. Donna’s face-to-face sales with consumers are an example of: A. direct selling. B. wholesale selling. C. account representation. D. detail selling. E. sales engineering. Answer: a Learning Objective: 01-05 Topic: Why Choose a Sales Career? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Direct sellers sell face-to-face to consumers—typically in their homes—who use the products for their personal use. Pampered Chef, Avon, and Amway rely on direct sellers. 49. Peter sells electrical supplies to retailers and home builders. Peter's organization buys the electrical supplies from various manufacturers. Peter is best classified as a(n) _________. A. retail salesperson B. detail salesperson C. accounts representative D. wholesale salesperson E. sales engineer Answer: D Learning Objective: 01-06 Topic: Why Choose a Sales Career? Blooms: Understand AACSB: AnalyticChapter 01 - The Life, Times, and Career of the Professional Salesperson 1-18 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: Wholesalers (also called distributors) buy products from manufacturers and other wholesalers and sell to other organizations. A wholesale salesperson, such as Peter, sells electrical supplies to retailers, such as Home Depot, which will then sell the products to final consumers. 50. A(n) _____ focuses on performing promotional activities and introducing new products rather than directly soliciting orders. A. sales engineer B. account representative C. detail salesperson D. retail salesperson E. service salesperson Answer: C Learning Objective: 01-05 Topic: Why Choose a Sales Career? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A detail salesperson concentrates on performing promotional activities and introducing new products rather than directly soliciting orders. For example, a medical detail salesperson seeks to persuade doctors, the indirect customers, to specify a pharmaceutical company’s trade name product for prescriptions. 51. Robert Clarence is a(n) _____ for a manufacturer of restaurant-grade appliances. He does not directly solicit orders. His primary duties involve promotional activities such as introducing and demonstrating new products at trade shows. A. retail salesperson B. detail salesperson C. sales engineer D. service salesperson E. account representative Answer: B Learning Objective: 01-06 Topic: Why Choose a Sales Career? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A detail salesperson concentrates on performing promotional activities and introducing new products rather than directly soliciting orders.Chapter 01 - The Life, Times, and Career of the Professional Salesperson 1-19 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 52. In the position of an account representative, an employee is most likely to: A. concentrate on performing promotional activities and introducing new products. B. sell products that call for an ability to discuss technical aspects of the product. C. sell tangible, highly complex products to industrial buyers and manufacturers. D. call on a large number of already established customers and ask for orders. E. sell the benefits of intangible or nonphysical products such as financial services. Answer: D Learning Objective: 01-06 Topic: Why Choose a Sales Career? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: An account representative calls on a large number of already established customers in, for example, the food, textile, and apparel industries. This person asks for the order. 53. A sales engineer: A. services the retail products sold to customers. B. services the industrial products sold to institutions. C. sells products directly to consumers. D. is also known as an order-taker. E. sells products that call for technical know-how. Answer: E Learning Objective: 01-05 Topic: Why Choose a Sales Career? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A sales engineer sells products that call for technical know-how and an ability to discuss technical aspects of the product. Expertise in identifying, analyzing, and solving customer problems is another critical factor. 54. Kevin contacted his local phone company yesterday and talked to the receptionist about whether or not it is possible to have an Internet connection without having local phone service. The receptionist is likely to have put him in touch with a(n): A. detail salesperson. B. retail salesperson. C. order-taker. D. account representative. E. sales engineer. Answer: E Learning Objective: 01-05 Topic: Why Choose a Sales Career? Blooms: Understand AACSB: AnalyticChapter 01 - The Life, Times, and Career of the Professional Salesperson 1-20 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: A sales engineer sells products that call for technical know-how and an ability to discuss technical aspects of the product. Expertise in identifying, analyzing, and solving customer problems, such as with Internet telephone service, is another critical factor. 55. (p. 12) In which of the following industries are you most likely to find a sales engineer being used? A. Apparel B. Heavy equipment C. Pharmaceuticals D. Pet supplies E. Health food Answer: B Learning Objective: 01-05 Topic: Why Choose a Sales Career? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A sales engineer sells products that call for technical know-how and an ability to discuss technical aspects of the product. This type of selling is common in the oil, chemical, machinery, and heavy equipment industries because of the technical nature of their products. Account representatives are common in food and apparel industries. 56. Billy Marshall sells blank aluminum cans for soda manufacturers to fill. Billy would be best classified as a(n): A. detail salesperson. B. account representative. C. sales engineer. D. direct salesperson. E. industrial products salesperson. Answer: E Learning Objective: 01-05 Topic: Why Choose a Sales Career? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: An industrial products salesperson, technical or nontechnical, sells a tangible product, such as aluminum cans, to industrial buyers. Account representatives are common in food and apparel industries.Chapter 01 - The Life, Times, and Career of the Professional Salesperson 1-21 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 57. Laura sells drawer pulls, hinges, and other decorative metal pieces used in the manufacture of furniture. Since the products that she sells to the furniture makers are nontechnical in nature, Laura could be best described as a(n): A. account representative. B. detail salesperson. C. sales engineer. D. order-taker. E. industrial products salesperson. Answer: E Learning Objective: 01-05 Topic: Why Choose a Sales Career? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: An industrial products salesperson, technical or nontechnical, sells a tangible product to industrial buyers. No high degree of technical knowledge is required as with sales engineers. 58. Fred has decided to switch from cable to satellite television. Fred calls DirecTV and speaks with an individual named Susan who places the order and collects Fred’s payment information. Susan is most likely a(n): A. detail salesperson B. order-taker C. service salesperson D. wholesale salesperson E. order-getter Answer: b Learning Objective: 01-05 Topic: Why Choose a Sales Career? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Order-takers ask what the customer wants or wait for the customer to place an order. Order-getters solicit new business using creative sales strategies. 59. Which of the following statements about order-getters is most likely true? A. They do not use a sales strategy. B. They wait for customers to place orders. C. They avoid creative sales presentations. D. They often do not attempt to close a sale. E. They typically earn more money than order-takers. Answer: e Learning Objective: 01-05 Topic: Why Choose a Sales Career? Blooms: UnderstandChapter 01 - The Life, Times, and Career of the Professional Salesperson 1-22 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Medium Explanation: Order-getters solicit new business using creative sales strategies. They commonly sell tangible goods or intangible services in highly competitive lines, and they usually earn much more than the order-taker. 60. What is one of the reasons that people choose sales jobs? A. Very little pressure B. High degree of freedom C. Minimal accountability required D. Few skills needed for success in the field E. High fixed salaries compared to most other jobs. Answer: B Learning Objective: 01-04 Topic: Why Choose a Sales Career? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A sales job provides possibly the greatest relative freedom of any career. Experienced employees in outside sales usually receive little direct supervision and may go for days, even weeks, without seeing their bosses, but that doesn’t mean they aren’t accountable for their actions. 61. In a large firm like Hewlett-Packard or General Electric, a salesperson's career path usually begins at the level of: A. district sales manager. B. sales engineer. C. sales trainee. D. key account salesperson. E. assistant manager. Answer: C Learning Objective: 01-05 Topic: Why Choose a Sales Career? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A salesperson’s career path generally begins at the level of sales trainee and moves up to salesperson, key account salesperson, and district sales manager.Chapter 01 - The Life, Times, and Career of the Professional Salesperson 1-23 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 62. Which of the following positions appears lower than other positions in the upward sequence of job movements during a sales career? A. District sales manager B. Key account salesperson C. Regional sales manager D. Area sales manager E. Divisional sales supervisor Answer: B Learning Objective: 01-05 Topic: Why Choose a Sales Career? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: In the sales personnel career path, a key account salesperson is lower than the district, regional, and divisional sales managers. 63. In addition to performance, the salary earned by a sales manager is LEAST related to the: A. annual sales volume of units managed. B. number of salespeople managed. C. length of experience in sales. D. annual sales volume of the firm. E. educational qualifications. Answer: E Learning Objective: 01-05 Topic: Why Choose a Sales Career? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Education is important in any position but is less relevant to the salary of salespeople. Salary is usually based on sales volume, management duties, and experience. 64. All of the following are nonfinancial rewards salespeople experience EXCEPT: A. job knowledge. B. job satisfaction. C. club memberships. D. positive self-worth. E. customer appreciation. Answer: C Learning Objective: 01-05 Topic: Why Choose a Sales Career? Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 01 - The Life, Times, and Career of the Professional Salesperson 1-24 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Club memberships and company cars are examples of financial rewards. Feeling job satisfaction and positive self-worth are nonfinancial rewards associated with sales jobs. 65. A senior salesperson regularly contacts the larger, more important customers. This function is referred to as a(n) _____ sales position. A. technical B. imagery C. key account D. composite E. alternate Answer: C Learning Objective: 01-06 Topic: Why Choose a Sales Career? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A firm’s large, important customers are known as key accounts. Handling key accounts is an important sales activity and a sign of status with the potential for financial rewards. 66. According to the text, there are several questions you should ask yourself as you decide whether a career in sales is appropriate for you. Which one of the following is LEAST relevant to determining whether a career in sales is best for you? A. How much freedom do I want in a job? B. Do I have the personality characteristics for the job? C. Am I willing to transfer to another city? D. Do I mind traveling for work? E. How much money do I want to earn? Answer: E Learning Objective: 01-06 Topic: Is a Sales Career Right for You? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Although income is important, it is less relevant to your career choice. Being in sales requires specific skills and demands including an outgoing personality and the willingness to travel.Chapter 01 - The Life, Times, and Career of the Professional Salesperson 1-25 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 67. The acronym SSUCCESS is used in selling to help you remember the eight: A. most frequently listed characteristics needed to be successful in sales. B. steps required to create a customer profile. C. mental stages of the customer purchasing process. D. types of knowledge a salesperson needs to succeed. E. steps to creating an effective sales presentation. Answer: A Learning Objective: 01-07 Topic: Success in Selling—What Does It Take? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The eight most frequently mentioned characteristics necessary to be successful in sales can be found in the words love and success. The word SSUCCESS, spelled with four s’s, is a tool for remembering those characteristics. 68. Which of the following is NOT part of the acronym SSUCCESS? A. Use of the Golden Rule B. Stamina for the job C. Personal characteristics D. Strategic thinking E. Cultural sensitivity Answer: E Learning Objective: 01-07 Topic: Success in Selling—What Does It Take? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Cultural sensitivity is not an element of the SSUCCESS acronym. Using the Golden Rule, having the necessary stamina and characteristics for the job, and showing the ability to think strategically are elements of SSUCCESS. 69. The "heart" of the eight work characteristics for sales success is: A. sales knowledge. B. cultural sensitivity. C. love of selling. D. communication ability. E. stamina for the job. Answer: C Learning Objective: 01-07 Topic: Success in Selling—What Does It Take? Blooms: Remember AACSB: AnalyticChapter 01 - The Life, Times, and Career of the Professional Salesperson 1-26 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: The successful salesperson is an individual who loves selling, finds it exciting, and is strongly convinced that the product being sold offers something of great value. Of the eight work characteristics for sales success, love of selling is clearly number one. 70. Which of the following statements about sales success is most likely true? A. For success in sales, it is more important to speak well than to listen well. B. Modern salespeople make contributions to the welfare of others through service. C. Operational orientation is more important to salespeople than strategic orientation. D. Successful salespeople are more focused on closing than the other aspects of sales. E. Physical attributes such as stamina are not relevant to long-term sales success. Answer: B Learning Objective: 01-07 Topic: Success in Selling—What Does It Take? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Today’s salespeople make a contribution to the welfare of others through service. They sell solutions to people’s needs that make their dreams come true. Successful salespeople are good listeners and speakers, and they have the stamina needed to meet the challenges of a sales career. 71. People like to buy from people they know and trust, which illustrates the importance of using: A. the Golden Rule of Selling. B. traditional methods of selling. C. a transactional approach to sales. D. the trial close ahead of close. E. an alternative sales close. Answer: A Learning Objective: 01-07 Topic: Success in Selling—What Does It Take? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: People like to buy from people they know and trust, which is why using the Golden Rule of Selling is important for success in sales. Today’s salesperson needs to treat others as he or she would like to be treated.Chapter 01 - The Life, Times, and Career of the Professional Salesperson 1-27 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 72. The basic competencies of selling that are required of top professional salespeople are selling skills and _________. A. accounting knowledge B. product knowledge C. ethical social responsibility D. interpersonal communication E. computer expertise Answer: B Learning Objective: 01-07 Topic: Success in Selling—What Does It Take? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Top professional salespeople have mastered the basic competencies of selling, which include product knowledge and selling skills. 73. According to the text, what is the most difficult trait for a salesperson to develop? A. Kindness B. Self-control C. Patience D. Caution E. Fairness Answer: B Learning Objective: 01-07 Topic: C—Characteristics for the Job Examined Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: Self-control is the most difficult trait for salespeople to develop because it involves restraining emotions and desires that stem from self-gain. Salespeople benefit financially from sales, so they feel pressure to persuade customers to make purchases even when buying may not be in the customer’s best interest. 74. Since it is essential to build a long-term relationship with buyers, the salesperson's job is to: A. persuade the customer to perform the desired action without much delay. B. coerce the customer to make a decision in favor of the company as early as possible. C. present necessary information for the buyer to make an educated decision. D. influence the customer-decision making process by manipulating available information. E. make sales presentations that are favorable to the company and its products. Answer: C Learning Objective: 01-07 Topic: C—Characteristics for the Job Examined Blooms: Understand AACSB: AnalyticChapter 01 - The Life, Times, and Career of the Professional Salesperson 1-28 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: The salesperson’s job is to present the necessary information for the buyer to make an educated decision. Patience in closing the sale goes a long way toward building a long-term relationship. 75. Which of the following is NOT one of the four main elements in the customer relationship process used by salespeople to build long-term relationships? A. Providing service B. Analyzing needs C. Gaining commitment D. Evaluating competitors E. Presenting product benefits Answer: D Learning Objective: 01-08 Topic: Relationship Selling Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Relationship selling refers to the desire by today’s salespeople to build longterm customer loyalty through the customer relationship process known as ABCS. The letters ABCS refer to analyzing customer needs, presenting product benefit, gaining customer commitment, and providing execellent service.Chapter 01 - The Life, Times, and Career of the Professional Salesperson 1-29 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 76. Which of the following statements about sales jobs is most likely false? A. Sales jobs require salespeople to exhibit more tact than other professions do. B. Many salespeople work with little or no supervision. C. Many sales jobs require considerable traveling and time spent away from family. D. Salespeople represent their companies to the outside world. E. Salespeople spend little or no company funds for entertainment. Answer: E Learning Objective: 01-06 Topic: Sales Jobs are Different Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Salespeople are among the few employees authorized to spend company funds. They spend this money for entertainment, transportation, and other business expenses. 77. Dwight has recently been promoted to a position as a territory manager. Which of the following should Dwight expect to do in his new job? A. Recruiting new employees B. Developing ad campaigns C. Designing product logos D. Solving customer issues E. Calculating overhead costs Answer: D Learning Objective: 01-06 Topic: What Does a Professional Salesperson Do? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: One of the primary jobs of a territory salesperson is handling customer problems. It is unlikely that Dwight would be involved with recruiting, marketing, or logo design. 78. As a part of providing service to customers, a professional salesperson would be expected to do all of the following EXCEPT: A. return damaged merchandise. B. handle customer complaints. C. develop promotional ideas. D. suggest business opportunities. E. provide information to competitors. Answer: E Learning Objective: 01-06 Topic: What Does a Professional Salesperson Do? Blooms: Remember AACSB: AnalyticChapter 01 - The Life, Times, and Career of the Professional Salesperson 1-30 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: Salesperson activities include assisting customers with business and product issues, arranging demonstrations, and providing product samples. The salesperson would not provide information to competitors but might give the customer information about the market. 79. Effective territory management most likely requires salespeople to: A. engage in strategic management opportunities. B. build integrated marketing communications systems. C. avoid nonselling activities due to cost overruns. D. provide employers with market information. E. sell exclusively to overseas, corporate clients. Answer: D Learning Objective: 01-06 Topic: What Does a Professional Salesperson Do? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Salespeople provide information to their companies on such topics as competitors’ activities, customers’ reactions to new products, complaints about products or policies, market opportunities, and their job activities. This information is so important for many companies that their salespeople are required to send in weekly or monthly reports on activities of the firm’s competition in their territory. 80. _____ skill is the cognitive ability to see the selling process as a whole and the relationship among its parts. A. Human B. Observational C. Conceptual D. Technical E. Developmental Answer: C Learning Objective: 01-07 Topic: The Future for Salespeople Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Conceptual skill is the cognitive ability to see the selling process as a whole and the relationship among its parts. Conceptual skill involves the seller’s thinking and planning abilities. Human skill is the seller’s ability to work with and through other people.Chapter 01 - The Life, Times, and Career of the Professional Salesperson 1-31 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 81. Which of the following is identified by the text as a conceptual skill? A. Using technology B. Thinking strategically C. Using persuasive speech D. Mastering sales techniques E. Working with other people Answer: B Learning Objective: 01-07 Topic: The Future for Salespeople Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Conceptual skill is the cognitive ability to see the selling process as a whole and the relationship among its parts. Conceptual skill involves the seller’s thinking and planning abilities and allows the seller to think strategically. 82. Sean is a salesperson with exceptional cognitive and technical skills and limited human skills. As a result, he most likely excels in all of the following areas EXCEPT: A. creating organized sales presentations. B. solving product problems and issues. C. knowing how a product fits into a customer's business. D. using creative techniques for selling products. E. working patiently with customers. Answer: E Learning Objective: 01-07 Topic: The Future for Salespeople Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Conceptual skill involves the seller’s thinking and planning abilities, and technical skill relates to the specialized knowledge and competencies needed to perform tasks. Human skill is the seller’s ability to work with and through other people, such as being patient and responsive rather than abrupt and critical. 83. Arthur, a pharmaceutical sales representative, is liked by his clients and he likes them. He is never critical and unsympathetic of his customers. Arthur most likely has _____ skills. A. networking B. operational C. technical D. human E. conceptual Answer: D Learning Objective: 01-07 Topic: The Future for Salespeople Blooms: UnderstandChapter 01 - The Life, Times, and Career of the Professional Salesperson 1-32 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Medium Explanation: Human skill is the seller’s ability to work with and through other people. Salespeople, such as Arthur, demonstrate this skill in the way they relate to other people, including customers or people within their own organizations. A seller with human skills likes other people and is liked by them. Sellers who lack human skills often are abrupt, critical, and unsympathetic. 84. According to the text, which of the following is an example of a technical skill? A. Mastering presentation techniques B. Solving problems strategically C. Building customer relationships D. Setting long-term goals E. Working with others Answer: A Learning Objective: 01-07 Topic: The Future for Salespeople Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Technical skill includes mastery of the methods, techniques, and equipment involved in selling—such as presentation skills and uses for one’s products. Technical skill is the understanding of and proficiency in the performance of specific tasks. 85. _____ skills refer to the seller's understanding and proficiency in the performance of specific tasks. A. Conceptual B. Operational C. Automated D. Transactional E. Technical Answer: E Learning Objective: 01-07 Topic: The Future for Salespeople Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Technical skill is the understanding of and proficiency in the performance of specific tasks. Technical skill includes mastery of the methods, techniques, and equipment involved in selling—such as presentation skills and uses for one’s products.Chapter 01 - The Life, Times, and Career of the Professional Salesperson 1-33 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 86. All of the following are benefits of e-selling for salespeople EXCEPT: A. developing rapport with new customers. B. increasing the speed for qualifying leads. C. reducing paperwork. D. reporting new sales to the company. E. servicing customers after the sale. Answer: A Learning Objective: 01-06 Topic: The Future for Salespeople Blooms: Understand AACSB: Technology Level of Difficulty: Medium Explanation: Technology and e-selling help salespeople increase the speed with which they can find and qualify leads, gather information prior to a customer presentation, reduce their paperwork, report new sales to the company, and service customers after the sale. It is unlikely that e-selling would develop rapport with customers. 87. Which of the following statements about small businesses is false? A. Almost half of all U.S. firms are small businesses. B. Small firms are a vital component of the U.S. economy. C. Small businesses can be both incorporated and unincorporated. D. Most large firms began as small businesses. E. Many small businesses struggle to compete with large firms. Answer: A Learning Objective: 01-06 Topic: The Future for Salespeople Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Approximately 98% of all U.S. businesses are small businesses, so they contribute significantly to the economy despite struggling to compete with large firms. Small businesses can be sole proprietorships, partnerships, corporations, part-time businesses, and unincorporated professional activities. 88. Which term refers to the salesperson's sequential series of actions that lead toward the customer taking a desired action? A. Talent management B. Marketing mix C. Sales process D. Sales presentation E. Marketing process Answer: C Learning Objective: 01-08 Topic: Building Relationships Through the Sales Process Blooms: RememberChapter 01 - The Life, Times, and Career of the Professional Salesperson 1-34 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Easy Explanation: The sales process refers to the salesperson’s sequential series of actions that leads toward the customer taking a desired action and ends with a follow-up to ensure purchase satisfaction. This desired action by a prospect is usually buying, which is the most important action. 89. According to Megatrends 2010 by Patricia Aburdene, the greatest megatrend in the U.S. is: A. business communication. B. excessive consumerism. C. global environmentalism. D. spirituality in business. E. personal growth. Answer: D Learning Objective: 01-08 Topic: The Future for Salespeople Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Patricia Aburdene’s Megatrends 2010: The Rise of Conscious Capitalism details new forces that will shape salespeople’s jobs. According to the book, spirituality in business is the greatest megatrend today. 90. _____ is the final step in the selling process. A. Presentation B. Meeting objections C. Sale closing D. Follow-up and service E. Sales delivery Answer: D Learning Objective: 01-08 Topic: Building Relationships through the Sales Process Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Follow-up and service is the final step in the selling process. Customer followup occurs after the sale has been closed and is essential to long-term customer relationships.Chapter 01 - The Life, Times, and Career of the Professional Salesperson 1-35 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Essay Questions 91. How do salespeople impact society? Answer: Salespeople generate more revenue in the U.S. economy than workers in any other profession. Salespeople impact society in such diverse areas as:  The success of new products.  Keeping existing products on the retailer's shelf.  Constructing manufacturing facilities.  Opening businesses and keeping them open.  Generating sales orders that result in the loading of trucks, trains, and other means of transport that carry goods to customers all over the world. Learning Objective: 01-01 Topic: What Is Selling? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 92. What is the traditional definition for personal selling? How does the traditional definition differ from the new one in the text? Answer: The new definition of personal selling inserts the word "unselfish" into the traditional definition. According to the new definition, personal selling refers to the personal communication of information to unselfishly persuade a prospective customer to buy something - a good, a service, an idea or something else - that satisfies that individual's needs. Learning Objective: 01-03 Topic: A New Definition of Personal Selling Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 93. What are the six major reasons for choosing a sales career? Why would you consider a career in sales? Answer: The six major reasons for choosing a sales career are:  The wide variety of sales jobs available.  The freedom of being on your own.  The challenge of selling.  The opportunity for advancement in a company.  The rewards from a sales career.  The opportunity to provide service to others. Learning Objective: 01-04 Topic: Why Choose a Sales Career? Blooms: Apply AACSB: Reflective ThinkingChapter 01 - The Life, Times, and Career of the Professional Salesperson 1-36 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Hard 94. Briefly describe the main types of manufacturer sales positions. Answer: There are five main types of manufacturer sales positions:  An account representative calls on a large number of already established customers. This person asks for the order.  A detail salesperson concentrates on performing promotional activities and introducing new products rather than directly soliciting orders.  A sales engineer sells products that call for technical know-how and an ability to discuss technical aspects of the product. Expertise in identifying, analyzing and solving customer's problems is another critical factor.  An industrial products salesperson, nontechnical, sells a tangible product to industrial buyers. No high degree of technical knowledge is required.  A service salesperson, unlike the four preceding types of manufacturing salespeople, must sell the benefits of intangible products such as financial, advertising, or computer repair services. Learning Objective: 01-04 Topic: Why Choose a Sales Career? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 95. What are the differences between order-takers and order-getters? Which job do you think would be more rewarding or difficult? Why? Answer: Some sales jobs require the salesperson only to take orders. Order-takers do not have a sales strategy and often use no sales presentation. Many never attempt to close a sale, and more importantly, few actually create sales. They may ask what the customer wants or wait for the customer to order. They are employed to bring in additional business that the employer probably would not obtain without their efforts. Order-getters, on the other hand, get new and repeat business using a creative sales strategy and a well-executed sales presentation. They creatively sell tangible goods or intangible services in highly competitive industries where the merchandise cannot be sold in equal volume without a salesperson. They face infinitely more difficult selling situations than the order-takers. Order-getters are true salespeople, which is why order-getters earn so much more than order-takers. Learning Objective: 01-05 Topic: Why Choose a Sales Career? Blooms: Apply AACSB: Reflective Thinking Level of Difficulty: HardChapter 01 - The Life, Times, and Career of the Professional Salesperson 1-37 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 96. What are the two types of rewards that salespeople can earn? Give an example of each. Answer: The two types of rewards that salespeople can earn are financial and nonfinancial. Nonfinancial rewards are sometimes called psychological income or intrinsic rewards. They are generated by the individual and not given by the company. An example of a nonfinancial reward is a feeling of self-worth. Many are attracted to selling because in a sales career financial rewards are commonly based solely on performance. Salaries and sales commissions are examples of financial rewards. Learning Objective: 01-04 Topic: Why Choose a Sales Career? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 97. What does the acronym SSUCCESS signify? Explain briefly. Answer: The acronym SSUCCESS signifies the eight most frequently mentioned characteristics necessary to be successful in sales. It refers to:  Service to others.  Use of the Golden Rule.  Communication ability.  Personal characteristics.  Excellence at strategic thinking.  Sales knowledge.  Stamina for the job.  Love of selling at the heart of all the above. Learning Objective: 01-07 Topic: Success in Selling—What Does It Take? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 98. What are the four main elements in the customer relationship process? What is the purpose of building customer relationships? Answer: The four main elements in the customer relationship process used by salespeople to build long-term relationships are:  Analyze customer needs.  Present product benefits.  Gain commitment for the purchase.  Provide excellent service in order to maintain and grow the relationship. Learning Objective: 01-07 Topic: Relationship Selling Blooms: Apply AACSB: Analytic Level of Difficulty: HardChapter 01 - The Life, Times, and Career of the Professional Salesperson 1-38 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 99. How do sales jobs differ from other jobs? What aspects would you enjoy or dislike? Why? Answer: Sales jobs are different from other jobs in several ways. Salespeople represent their companies to the outside world. Consequently, opinions of a company and its products are often formed from impressions left by the sales force. Other employees usually work under close supervisory control, whereas the outside salesperson typically operates with little or no direct supervision. Salespeople probably need more tact, diplomacy, and social poise than other employees in an organization. Salespeople are among the few employees authorized to spend company funds. Some sales jobs frequently require considerable traveling and time spent away from home and family. Learning Objective: 01-06 Topic: Sales Jobs Are Different Blooms: Apply AACSB: Reflective Thinking Level of Difficulty: Hard 100. List and briefly explain three important categories of skills that are necessary for a salesperson's success. Answer: The necessary skills that are necessary for a salesperson's success can be summarized in three categories that are especially important: conceptual, human, and technical. Conceptual skill: It is the cognitive ability to see the selling process as a whole and the relationship among its parts. It involves the seller's thinking and planning abilities. This skill is especially important for order-getters. Human skill: It is the seller's ability to work with and through other people. Salespeople demonstrate this skill in the way they relate to other people. A seller with human skills likes other people and is liked by others. Technical skill: It is the understanding and proficiency in the performance of specific tasks. It includes mastery of the methods, techniques, and equipment involved in selling such as presentation skills and uses for one's products. It includes specialized knowledge, analytical ability, and the competent use of tools and techniques to solve problems in that specific domain. Learning Objective: 01-06 Topic: The Future for Salespeople Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 02 - Relationship Marketing: Where Personal Selling Fits 2-1 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Chapter 02 Relationship Marketing: Where Personal Selling Fits Learning Objectives: 02-01 Define and explain the terms marketing and marketing concept. 02-02 Describe the evolution of customer orientation in the United States. 02-03 Answer the question, why is marketing important to an organization? 02-04 Illustrate how the firm’s product, price, distribution, and promotion efforts are coordinated for maximum sales success. 02-05 Explain why an organization should listen to its customers. 02-06 Discuss the role of personal selling in the firm’s marketing relationship efforts. 02-07 Understand a salesperson’s roles when practicing consultative selling. True / False Questions 1. The purpose of business is to increase the general well-being of humankind through the sale of goods and services. Answer: True Learning Objective: 02-01 Topic: What Is the Purpose of Business? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The purpose of business is to increase the general well-being of mankind through the sale of goods and services. This requires making a profit in order to operate the business and provide beneficial products to the marketplace. 2. Before the Great Depression, few firms had either sales or marketing departments. Answer: True Learning Objective: 02-01 Topic: Customer Orientation’s Evolution Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Prior to the Great Depression, few firms had marketing departments, and many did not even have a formal sales department. An engineer would develop a product, have the production department make it, and then simply put it in the catalog and wait for people to order.Chapter 02 - Relationship Marketing: Where Personal Selling Fits 2-2 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 3. A transaction is a trade of values between two parties. Answer: True Learning Objective: 02-01 Topic: What Is Marketing? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A transaction is a trade of values between two parties; it forms a relationship between buyer and seller. Once the transaction has occurred, an exchange is complete. 4. Soon after World War II, most firms focused on training salespeople in effective selling techniques and developing products to meet the needs of customers. Answer: False Learning Objective: 02-02 Topic: Customer Orientation’s Evolution Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A few years after the war, companies still produced goods with little regard for the consumers’ needs. Few companies recognized the value of training their salespeople in selling techniques. However, as time passed, businesses found that they had to become market oriented rather than sales oriented. 5. One of the fundamental beliefs of the marketing concept is that all company planning and operations should be customer oriented. Answer: True Learning Objective: 02-02 Topic: Customer Orientation’s Evolution Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The marketing concept is a business philosophy that says the customers’ wantsatisfaction is the economic and social justification for a firm’s existence. Consequently, all company planning and operations should be customer oriented.Chapter 02 - Relationship Marketing: Where Personal Selling Fits 2-3 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 6. The difference between the selling and marketing concepts is that in selling the emphasis is on customers' wants. Answer: False Learning Objective: 02-02 Topic: Customer Orientation’s Evolution Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The marketing concept focuses on customer wants. In contrast, the selling concept focuses on the product. 7. A company practicing the marketing concept bends consumer demand to fit the company's supply. Answer: False Learning Objective: 02-02 Topic: Customer Orientation’s Evolution Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Firms following the marketing concept determine customer wants before making and delivering products. Therefore, company products are shaped to meet consumer demands. 8. Marketing helps generate sales by providing the quality of service customers expect. Answer: True Learning Objective: 02-03 Topic: Marketing’s Importance in the Firm Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Quality service helps the organization to maximize sales. It is the performance of service that creates true customers: customers who buy more and who influence others to buy. 9. A firm's marketing mix consists of product, price, place, and performance. Answer: False Learning Objective: 02-04 Topic: Essentials of a Firm’s Marketing Effort Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Product, price, place or distribution, and promotion are the four components of the marketing mix.Chapter 02 - Relationship Marketing: Where Personal Selling Fits 2-4 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 10. The typical salesperson sells either goods or services, but not both. Answer: False Learning Objective: 02-04 Topic: Essentials of a Firm’s Marketing Effort Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Salespeople have gone from selling goods, to selling goods, services, and ideas, to now selling goods, ideas, services, and value-added services. 11. A "product" is a bundle of tangible attributes, while intangible attributes are called a "service." Answer: False Learning Objective: 02-04 Topic: Essentials of a Firm’s Marketing Effort Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A service is an intangible action or activity done for others for a fee. The term product can be goods, service, idea, or a combination of these. 12. There are two types of products: consumer and industrial. Answer: True Learning Objective: 02-04 Topic: Essentials of a Firm’s Marketing Effort Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: There are two general types of products. Consumer products are produced for, and purchased by, households or end consumers for their personal use. Industrial products are sold primarily for use in producing other products. 13. The corporate marketing department determines each product's initial price. Answer: True Learning Objective: 02-04 Topic: Essentials of a Firm’s Marketing Effort Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The corporate marketing department also determines each product’s initial price. This process involves establishing each product’s normal price and possible special discount prices.Chapter 02 - Relationship Marketing: Where Personal Selling Fits 2-5 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 14. "Household" refers to a decision-making unit buying for personal use. Answer: True Learning Objective: 02-04 Topic: Essentials of a Firm’s Marketing Effort Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A household refers to a decision-making unit buying for personal use. Every individual in the economy belongs to a household. 15. "Government" is an organization that supplies goods and services to households and firms. Answer: True Learning Objective: 02-04 Topic: Essentials of a Firm’s Marketing Effort Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A government is an organization that has two functions: the provision of goods and services to households and firms and the redistribution of income and wealth. 16. Wholesalers are in the distribution channels exclusively for industrial products, whereas retailers deal with consumer products. Answer: False Learning Objective: 02-04 Topic: Essentials of a Firm’s Marketing Effort Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Wholesalers deal with both consumer and industrial products. Wholesalers sell to both retailers and to industrial or business users. Retailers typically sell to final consumers. 17. The promotional element of the marketing mix is designed to increase company sales by communicating product information to potential customers. Answer: True Learning Objective: 02-04 Topic: Essentials of a Firm’s Marketing Effort Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Promotion, as part of the marketing mix, increases company sales by communicating product information to potential customers. The company’s sales force is one segment of the firm’s promotional effort.Chapter 02 - Relationship Marketing: Where Personal Selling Fits 2-6 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 18. Firms typically spend more money on advertising and promotion than on the sales force. Answer: False Learning Objective: 02-04 Topic: Essentials of a Firm’s Marketing Effort Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Firms typically spend more money on their sales force than on advertising and promotion. Organizations selling in industrial markets spend a higher percentage of the promotion budget on their sales force than manufacturers of consumer goods. 19. The trend in relationship marketing today is away from creating customers for tomorrow to selling well to customers today. Answer: False Learning Objective: 02-05 Topic: Relationship Marketing Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Organizations today have targeted new and present customers. The emphasis is shifting from selling customers today to creating customers for tomorrow. Thus, business is thinking more long term than short term. 20. Relationship marketing is based on an idea that important customers need continuous attention. Answer: True Learning Objective: 02-05 Topic: Relationship Marketing Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Relationship marketing is based on the idea that important customers need continuous attention. An organization using relationship marketing is not seeking a simple sale or transaction. It has targeted a major customer that it would like to sell to now and in the future.Chapter 02 - Relationship Marketing: Where Personal Selling Fits 2-7 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 21. The main function of personal selling is to build relationships with customers. Answer: True Learning Objective: 02-06 Topic: Relationship Marketing and the Sales Force Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The main functions of personal selling are to generate revenue and provide service to help make customers satisfied with their purchases. This builds relationships and is the key to success in today’s competitive marketplace. 22. Virtually every product you see in any retail store was sold to it by a salesperson. Answer: True Learning Objective: 02-06 Topic: Relationship Marketing and the Sales Force Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Virtually every product you see in any factory, office, school, or retail store was sold to that organization by a salesperson. Salespeople are responsible for making products available to the public. 23. Service quality is an objective assessment determined by customers who compare service levels with industry benchmarks. Answer: False Learning Objective: 02-06 Topic: Relationship Marketing and the Sales Force Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Service quality is a subjective satisfaction assessment that customers arrive at by comparing the service level they believe an organization ought to deliver to the service level that they perceive being delivered. 24. Relationship marketing and the marketing concept both emphasize sales volume and product features. Answer: False Learning Objective: 02-06 Topic: Relationship Marketing and the Sales Force Blooms: Remember AACSB: AnalyticChapter 02 - Relationship Marketing: Where Personal Selling Fits 2-8 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: Relationship marketing and the marketing concept are based on the philosophy of being customer oriented. Firms that follow a selling concept emphasize sales volume and product features. The marketing concept focuses on customer wants and long-term profits. . 25. In transaction selling, the seller contacts customers after the purchase to determine if they are satisfied and have future needs. Answer: False Learning Objective: 02-06 Topic: Levels of Relationship Marketing Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: In transaction selling, customers are sold to and not contacted again. With relationship selling, the seller contacts customers after the purchase to determine if they are satisfied and have future needs. 26. Transaction selling is practiced by firms producing low-profit, low-priced products. Answer: True Learning Objective: 02-06 Topic: Levels of Relationship Marketing Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: With transaction selling, customers are sold to and not contacted again. Transaction selling is common among firms selling low-profit, low-priced products. 27. The goal of partnering is that the profits are shared by the buyer and seller, but the risk is borne by the buyer alone. Answer: False Learning Objective: 02-06 Topic: Partnering with Customers Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Partnering encourages both buyer and seller to share information such as marketing research findings and production cost data. Their goal is to share risks and profits together. 28. Today, the typical sales call focuses on a specific product and is tightly controlled by the salesperson. Answer: False Learning Objective: 02-07 Topic: The New Consultative Selling Blooms: RememberChapter 02 - Relationship Marketing: Where Personal Selling Fits 2-9 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Easy Explanation: In the past, the typical sales presentation was a pitch focused on a specific product and tightly controlled by the salesperson. Today, the best sales calls are highly interactive dialogues between a salesperson and a customer working toward a common goal. 29. Companies that put partnering into practice find they increase conflicts of interest between themselves and their clients. Answer: False Learning Objective: 02-05 Topic: Partnering with Customers Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Companies that put partnering into practice find they reduce or eliminate conflicts of interest between themselves and their clients. Those who work at partnering find that very quickly their sensitivity and responsiveness improve significantly. 30. In the role of team leader, the salesperson coordinates all of the information, resources, and activities needed to support customers before, during, and after the sale. Answer: True Learning Objective: 02-07 Topic: The New Consultative Selling Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: In the role of team leader, the salesperson coordinates all of the information, resources, and activities needed to support customers before, during, and after the sale. The team leader works to bring together all of the organization’s resources for the customer. 31. As a business consultant, the salesperson gives advice and service to the customer. Answer: True Learning Objective: 02-07 Topic: The New Consultative Selling Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: As a business consultant, the salesperson gives advice and service. The salesperson uses internal and external resources to gain an understanding of the customer’s business and marketplace.Chapter 02 - Relationship Marketing: Where Personal Selling Fits 2-10 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 32. Salespeople who fulfill the consultative role of long-term ally work to eliminate the relationship gap. Answer: True Learning Objective: 02-07 Topic: The New Consultative Selling Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Salespeople who fulfill the role of long-term ally work to eliminate the relationship gap by ensuring that the customer is receiving the level of support and service that meets expectations now and throughout the duration of the customer relationship process. 33. Technology has advanced so rapidly that it has become a burden to sales managers and sales representatives in certain industries. Answer: False Learning Objective: 02-07 Topic: E-Selling: Technology and Information Build Relationships Blooms: Remember AACSB: Technology Level of Difficulty: Easy Explanation: Salespeople have access to almost any conceivable piece of information or data, which is beneficial to managers and sales representatives. Technology is making it possible to improve a person’s sales and service performance. 34. Customers tend to become less price-sensitive when they become accustomed to dealing with a salesperson. Answer: True Learning Objective: 02-07 Topic: What’s a Salesperson Worth? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Customers tend to become less price-sensitive when they become accustomed to dealing with a salesperson and receiving great service, which makes effective salespeople valuable to their employers. 35. Marketing's main customer contacts are buyers. Answer: False Learning Objective: 02-07 Topic: The Key to Success Blooms: Remember AACSB: AnalyticChapter 02 - Relationship Marketing: Where Personal Selling Fits 2-11 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: A marketer is rarely in direct contact with a buyer. Marketing’s main customer contacts are salespeople. Multiple Choice Questions 36. According to the text, what are the two major functions of a business firm? A. Strategies and tactics B. Production and marketing C. Production and selling D. Selling and marketing E. Buying and selling Answer: B Learning Objective: 02-01 Topic: What Is the Purpose of Business? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Reduced to basics, businesses have two major functions: production of goods or creation of services and marketing those goods and services. 37. You are giving a tour of businesses to several classical musicians from China. One of the Chinese in the tour group has asked you to define the purpose of business. How should you answer this question? A. Produce goods and then wait for consumers to buy them B. Encourage consumers to buy products they may not want C. Speed up changes in the economic environment D. Create large profit-oriented organizations E. Increase the general well-being of people by selling goods and services Answer: E Learning Objective: 02-01 Topic: What Is the Purpose of Business? Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: The primary goal of business should be to transform the marketplace and workplace into an environment where everyone is treated as they would like to be treated. Business should be fair to all parties involved in both the buying and selling of goods and services.Chapter 02 - Relationship Marketing: Where Personal Selling Fits 2-12 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 38. _____ is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large. A. Consumerism B. Profit maximization C. Marketing D. Salesmanship E. Professional selling Answer: C Learning Objective: 02-01 Topic: What Is Marketing? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Marketing involves a diverse set of activities directed at a wide range of goods, services, and ideas. These activities involve the development, pricing, promotion, and distribution of want-satisfying goods and services to consumers and industrial users. 39. Which of the following statements about transactions and exchanges is most likely true? A. Service-oriented businesses have exchanges but no transactions. B. Marketing-oriented businesses have transactions but no exchanges. C. The completion of an exchange is unrelated to the occurrence of a transaction. D. Once a transaction has occurred, the exchange is complete. E. The terms "transaction" and "exchange" can be used as synonyms. Answer: D Learning Objective: 02-01 Topic: What Is Marketing? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: When an exchange occurs, a transaction takes place, as transactions are the basic unit of exchange. Once the transaction has occurred, the exchange is complete. 40. A bartering relationship, such as when Patricia agrees to take care of Timothy's horses and receives in return free riding lessons, is an example of: A. an exchange. B. top-to-top partnering. C. relational marketing. D. transactional partnering. E. consultative selling. Answer: A Learning Objective: 02-01 Topic: What Is Marketing? Blooms: Apply AACSB: AnalyticChapter 02 - Relationship Marketing: Where Personal Selling Fits 2-13 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Hard Explanation: Exchange refers to the act of obtaining a desired product from someone by offering something in return. In this case, Patricia and Timothy both obtained desired services from each other. 41. Before the Great Depression of the 1930s, companies were primarily focused on: A. production. B. bartering. C. customer service. D. relationship marketing. E. social responsibility. Answer: A Learning Objective: 02-02 Topic: Customer Orientation’s Evolution Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Prior to the Great Depression, most firms were production oriented. Few firms had marketing or sales departments. 42. The headline of an advertisement for a 1930s automobile manufacturer read, "We know what our customers want! They want our new luxury sedan!" You can infer from reading this headline that the manufacturer had a(n) _____ orientation. A. customer B. environmental C. marketing D. production E. promotion Answer: D Learning Objective: 02-02 Topic: Customer Orientation’s Evolution Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: The ad focuses on the product rather than the needs or wants of the customer. Most firms of that time were production oriented and lacked sales or marketing departments.Chapter 02 - Relationship Marketing: Where Personal Selling Fits 2-14 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 43. Roy loves cooking and recently quit his job as an engineer to open a restaurant in a small, rural town. Roy serves the most exquisite cuisine in an elegant atmosphere. Nevertheless, sales have been so slow that Roy may have to close the restaurant. Roy's only competitor is a very successful café that serves your choice of one meat, three vegetables, and dessert cooked "country style" with tea or coffee for under $6.00 per person. Roy’s business is most likely struggling because Roy has a _____ orientation. A. customer B. selling C. marketing D. production E. promotion Answer: D Learning Objective: 02-02 Topic: Customer Orientation’s Evolution Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: Roy is focused on what he likes to cook or produce rather than what customers want, which is why his business is struggling. 44. Businesses that have a selling orientation: A. emphasize the product over all other marketing mix elements. B. train salespeople to analyze customer wants and needs. C. emphasize long-term planning and globalization. D. identify customer wants before making products. E. pursue consumer satisfaction as a primary objective. Answer: A Learning Objective: 02-02 Topic: Customer Orientation’s Evolution Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Firms that have a selling concept emphasize the product over other components of the marketing mix. Such firms encourage salespeople to have extensive product knowledge and are less likely to encourage salespeople to determine customer wants and needs.Chapter 02 - Relationship Marketing: Where Personal Selling Fits 2-15 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 45. A sales representative in the 1940s would most likely receive training from an employer on which of the following topics? A. Customer service B. Product features C. Market analysis D. Sales presentations E. Promotional techniques Answer: B Learning Objective: 02-02 Topic: Customer Orientation’s Evolution Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Firms in the 1940s stressed selling products over marketing them. Salespeople received training that provided them with product knowledge and relied on their personal skills to give sales presentations. 46. Businesses that have a marketing orientation: A. are sales-volume oriented. B. emphasize the product over the other marketing mix elements. C. first make the product and then figure out how to sell it. D. emphasize long-term planning. E. stress the needs of sellers. Answer: D Learning Objective: 02-01 Topic: Customer Orientation’s Evolution Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The marketing concept is a business philosophy that says the customers’ wantsatisfaction is the economic and social justification for a firm’s existence. Such firms emphasize long-term planning in terms of new products and future needs. 47. The major thrust of the marketing concept is to: A. sell the product at a low cost to customers. B. satisfy customers, no matter what the costs. C. satisfy customer wants, while still making a profit. D. distribute products more equitably. E. maximize stakeholder relationships. Answer: C Learning Objective: 02-01 Topic: Customer Orientation’s Evolution Blooms: UnderstandChapter 02 - Relationship Marketing: Where Personal Selling Fits 2-16 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Medium Explanation: The marketing concept is a business philosophy that says the customers’ wantsatisfaction is the economic and social justification for a firm’s existence. Consequently, all company activities should be devoted to determining customers’ wants and then satisfying them, while still making a profit. 48. In order for a firm to realize the full benefits of the marketing concept, that philosophy must be translated into action. This means marketing activities must be fully coordinated, well managed, and: A. the mission statement must be time-sensitive. B. management must have a sales volume orientation. C. the company must rely on short-term strategic windows. D. the chief marketing executive must be given a key role in company planning. E. marketing goals must be customer-oriented, nonspecific, flexible, and quantitative. Answer: D Learning Objective: 02-02 Topic: Customer Orientation’s Evolution Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: For a business enterprise to realize the full benefits of the marketing concept, this philosophy must be translated into action. This means (1) marketing activities must be fully coordinated and well managed and (2) the chief marketing executive must be accorded an important role in company planning. 49. Which of the following links customers and organizations? A. Marketing group B. Top management C. Production department D. Human resources department E. Staff-level employees Answer: A Learning Objective: 02-03 Topic: Marketing’s Importance in the Firm Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The marketing group is the link between customers and the organization. Salespeople are part of marketing, and they are in direct contact with customers.Chapter 02 - Relationship Marketing: Where Personal Selling Fits 2-17 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 50. The main role of marketing in an organization is to: A. use revenues to create new products. B. manage financial resources to meet legal requirements. C. generate sales so the company can stay in business. D. serve as a conduit between the firm and its stakeholders. E. identify and correct quality control issues. Answer: C Learning Objective: 02-03 Topic: Marketing’s Importance in the Firm Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The main role of marketing in an organization is basically to generate revenues. The money marketing generates are managed by the financial people and used by the production people in creating goods and services. Marketing activities are therefore very important to the organization because it must generate sales to stay in business. 51. The four main elements of the marketing mix are: A. product, packaging, people, and price. B. price, process, prestige, and product. C. promotion, product, prestige, and price. D. product, price, place, and promotion. E. place, production, packaging, and promotion. Answer: D Learning Objective: 02-04 Topic: Essentials of a Firm’s Marketing Effort Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A firm’s marketing mix consists of four main elements—product, price, distribution or place, and promotion—that a marketing manager uses to market goods and services. 52. Which of the following statements is most likely true? A. Products are tangible but not intangible. B. Products contain many value-added features. C. Salespeople sell goods and services but not products. D. Product is a term that refers to both goods and services. E. Three general types of products exist: consumer, industrial, and global. Answer: D Learning Objective: 02-04 Topic: Essentials of a Firm’s Marketing Effort Blooms: Understand AACSB: AnalyticChapter 02 - Relationship Marketing: Where Personal Selling Fits 2-18 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: A product is a bundle of tangible and intangible attributes, including packaging, color, and brand, plus the services and even the reputation of the seller. Value-added refers to benefits received that are not included in the purchase price of the individual goods, service, or idea, and they may or may not be a component of a product. 53. Which of the following statements about products, goods, and services is true? A. Products are a bundle of purely intangible attributes. B. Services are tangible products. C. Goods are physical objects that can be purchased. D. Salespeople never or rarely sell services. E. Products only refer to physical objects. Answer: C Learning Objective: 02-04 Topic: Essentials of a Firm’s Marketing Effort Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Goods are physical objects, such as cars and radios that can be purchased. A product is a bundle of tangible and intangible attributes, including packaging, color, and brand, plus the services and even the reputation of the seller. 54. When Larry purchased a Jet Ski personal watercraft for $4,999, he was also given free financing and three hours of free lessons on how to safely enjoy jet skis. Neither the financing nor the lessons were included in the price of the Jet Ski; both are examples of: A. value-added benefits. B. bundling. C. profit maximization. D. privileges. E. add-on pricing. Answer: A Learning Objective: 02-04 Topic: Essentials of a Firm’s Marketing Effort Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: Value-added refers to benefits received that are not included in the purchase price of the individual goods, service, or idea. The jet-ski retailer offers customers free financing and lessons as value-added benefits.Chapter 02 - Relationship Marketing: Where Personal Selling Fits 2-19 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 55. The development of package design, trademarks, warranties, and service policies is associated with the _____ element of the marketing mix. A. product B. presentation C. price D. place E. promotion Answer: A Learning Objective: 02-04 Topic: Essentials of a Firm’s Marketing Effort Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A product is a bundle of tangible and intangible attributes, including packaging, color, trademark, and brand, plus service policies, warranties, and even the reputation of the seller. 56. Ford is offering customers $1,000 cash back if they purchase a Ford Focus in the month of December. Which component of the marketing mix is most likely illustrated by Ford’s tactic? A. Destination B. Presentation C. Product D. Distribution E. Price Answer: E Learning Objective: 02-04 Topic: Essentials of a Firm’s Marketing Effort Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Price refers to the value or worth of a product that attracts the buyer to exchange money or something of value for the product. Companies develop varied pricing techniques and methods for their salespeople to use, such as cash rebates to increase automobile sales.Chapter 02 - Relationship Marketing: Where Personal Selling Fits 2-20 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 57. The marketing manager of NevaFlat Tire Company must make the firm's products available to customers in convenient locations. This activity is associated with the _____ element of the marketing mix. A. facility B. availability C. direction D. distribution E. promotion Answer: D Learning Objective: 02-04 Topic: Essentials of a Firm’s Marketing Effort Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Distribution refers to the channel structure used to transfer products from an organization to its customers. It is important to have the product available to customers in a convenient and accessible location when they want it. 58. Customers fall into one of three groups. They are: A. individuals, households, and other businesses. B. stakeholders, governments, and nonprofit groups. C. households, firms, and governments. D. retailers, wholesalers, and consumers. E. governments, stakeholders, and manufacturers. Answer: C Learning Objective: 02-04 Topic: Essentials of a Firm’s Marketing Effort Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Customers belong to households, firms, or governments. Customers can be either individuals or organizations. 59. As a customer, a government is best described as an organization that: A. provides goods and services to households and firms. B. produces goods for profit and global redistribution. C. sells products at wholesale prices to other nations. D. promotes local and national businesses. E. manages the exchange process. Answer: A Learning Objective: 02-04 Topic: Essentials of a Firm’s Marketing Effort Blooms: UnderstandChapter 02 - Relationship Marketing: Where Personal Selling Fits 2-21 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Medium Explanation: A government is an organization that has two functions: the provision of goods and services to households and firms and the redistribution of income and wealth. Examples of the goods and services supplied by the government are national defense, law enforcement, public health, transportation, and education. 60. _____ purchase products and then sell the products to organizations and/or individuals. A. Transactional intermediaries B. Resellers C. Value-added specialists D. Manufacturers E. End-users Answer: B Learning Objective: 02-04 Topic: Essentials of a Firm’s Marketing Effort Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Resellers, such as wholesalers or retailers, purchase products and then sell them to organizations and/or individuals. The wholesaler buys goods in large quantities, reselling them, usually in smaller quantities, to retailers or to industrial or business users. The retailer buys goods from others and sells them to ultimate consumers for their personal use. 61. The appearance of actor Sarah Jessica Parker in commercials for The Gap, a retail store, is an example of the use of the _____ element of the marketing mix. A. sales presentation B. personal selling C. product D. profit E. promotion Answer: E Learning Objective: 02-04 Topic: Essentials of a Firm’s Marketing Effort Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Promotion, as part of the marketing mix, increases company sales by communicating product information to potential customers. An actor promoting a product in an advertisement is a form of promotion.Chapter 02 - Relationship Marketing: Where Personal Selling Fits 2-22 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 62. Which of the following statements about personal selling is true? A. It falls under the marketing mix category of promotion. B. It is the primary tool of non-personal communication. C. It involves giving free samples and coupons to potential buyers. D. It is the communication of information that is not paid for by the firm. E. It is divided into consumer and trade personal selling. Answer: A Learning Objective: 02-04 Topic: Essentials of a Firm’s Marketing Effort Blooms: Understand AACSB: Level of Difficulty: Medium Explanation: Personal selling is personal communication of information to unselfishly persuade a prospective customer to buy a good, service, idea, or something else that satisfies an individual’s needs. Personal selling is an activity involved in the promotion aspect of the marketing mix. 63. In most cases, which of the following receives the highest percentage of a firm’s promotional budget? A. Commercials B. Sales force C. Human resources D. Public relations E. Print advertising Answer: B Learning Objective: 02-04 Topic: Essentials of a Firm’s Marketing Effort Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Firms typically spend more money on their sales force than on advertising and promotion. Organizations selling in industrial markets spend a higher percentage of the promotion budget on their sales force than manufacturers of consumer goods.Chapter 02 - Relationship Marketing: Where Personal Selling Fits 2-23 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 64. The text defines _____ as "personal communication of information to unselfishly persuade a prospective customer to buy something that satisfies an individual's needs." A. promotion B. personal selling C. publicity D. sales promotion E. advertising Answer: B Learning Objective: 02-04 Topic: Essentials of a Firm’s Marketing Effort Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Personal selling is personal communication of information to unselfishly persuade a prospective customer to buy a good, service, idea, or something else that satisfies an individual’s needs. 65. When Ford Motor Company pays to use nonpersonal communication to present information to potential buyers, it is using which promotional activity? A. Multilevel marketing B. Personal selling C. Publicity D. Direct selling E. Advertising Answer: E Learning Objective: 02-04 Topic: Essentials of a Firm’s Marketing Effort Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Advertising is defined as nonpersonal communication of information paid for by an identified sponsor such as an individual or an organization like Ford. Modes of advertising include television, radio, direct mail, catalogs, newspapers, and outdoor advertising such as billboards.Chapter 02 - Relationship Marketing: Where Personal Selling Fits 2-24 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 66. _____ involves activities or materials used to create sales for goods and services, such as coupons and sales contests. A. Direct selling B. Public relations C. Customer service D. Sales promotion E. Advertising Answer: D Learning Objective: 02-04 Topic: Essentials of a Firm’s Marketing Effort Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Sales promotion involves activities or materials used to create sales for goods or services. Coupons, contests, displays, and demonstrations are examples of sales promotions. 67. The goal of an organization when creating its _____ is to create the right product, at the right price, at the right time, with the right promotional effort. A. sales promotion B. mission statement C. operational plan D. vision statement E. marketing mix Answer: E Learning Objective: 02-04 Topic: Essentials of a Firm’s Marketing Effort Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: An organization’s marketing group strives to create a marketing mix containing the right product, at the right price, at the right time, with the right promotional effort. 68. Which marketing mix activity is being used when the salesperson participates in a trade show or uses telemarketing? A. Pricing B. Distribution C. Direct sales D. Product E. Promotion Answer: E Learning Objective: 02-04 Topic: Essentials of a Firm’s Marketing Effort Blooms: RememberChapter 02 - Relationship Marketing: Where Personal Selling Fits 2-25 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Easy Explanation: Promotion involves increasing company sales by communicating product information. Trade shows, telemarketing, direct sales, and public relations are all examples of promotion activities. 69. _____ marketing is the creation of customer loyalty. A. Transaction B. Relationship C. Value-added D. Continuous E. Covenant Answer: B Learning Objective: 02-06 Topic: Relationship Marketing Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Relationship marketing is the creation of customer loyalty. Relationship marketing is based on the idea that important customers need continuous attention. 70. Relationship marketing is based on the idea that: A. important customers need continuous attention. B. a salesperson can never really know too many people. C. the burden of quality rests with the seller of the product. D. a salesperson is only as successful as the product being sold. E. friends and referrals are the key to long-term sales performance. Answer: A Learning Objective: 02-06 Topic: Relationship Marketing Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Relationship marketing is the creation of customer loyalty. Organizations use combinations of products, prices, distributions, promotions, and services to achieve this goal. Relationship marketing is based on the idea that important customers need continuous attention.Chapter 02 - Relationship Marketing: Where Personal Selling Fits 2-26 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 71. Which of the following is a unique benefit of personal selling? A. Highlighting product features B. Achieving high sales at minimal costs C. Explaining credit terms to potential customers D. Customizing presentations to match customer needs E. Reaching mass audiences quickly and cost effectively Answer: D Learning Objective: 02-06 Topic: Relationship Marketing and the Sales Force Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Because they are involved in person-to-person discussions, salespeople can customize their sales presentations to the individual needs of specific people and organizations. Salespeople can see a customer’s reaction to a sales approach and make necessary needed adjustments immediately. 72. Margaret is unhappy about her experience with All-Brand Appliance Store. When she purchased a new refrigerator on Monday, she explained that her old one had stopped functioning and that speedy delivery of the new one was vital because she was trying to keep her food fresh in an ice chest. It is late Thursday afternoon and her refrigerator has not yet arrived. Margaret is unhappy with All-Brand's: A. social responsibility. B. ethical ombudsmanship. C. marketing strategy. D. sales quotas. E. service quality. Answer: E Learning Objective: 02-06 Topic: Relationship Marketing and the Sales Force Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Service quality is a subjective satisfaction assessment that customers arrive at by comparing the service level they believe an organization ought to deliver to the service level that they perceive being delivered. Margaret is unhappy with All-Brand’s service because the store has failed to deliver the refrigerator when she needed it.Chapter 02 - Relationship Marketing: Where Personal Selling Fits 2-27 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 73. The marketing manager for a large furniture store has received numerous complaints about the store's delivery personnel. While the manager believes his delivery personnel do a good job because the deliveries are made quickly and generally at their scheduled time, customers find the delivery personnel rude. The marketing manager must deal with problems associated with: A. social responsibility. B. promotional integrity. C. marketing strategy. D. value-added pricing. E. service quality. Answer: E Learning Objective: 02-06 Topic: Relationship Marketing and the Sales Force Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Service quality is a subjective satisfaction assessment that customers arrive at by comparing the service level they believe an organization ought to deliver to the service level that they perceive being delivered. Customers believe the deliver personnel should be friendlier, so service quality is an issue for the firm. 74. When Stuart sold a computer network to a Fortune 500 company, he often called on the company's purchasing department to see if employees were satisfied with the network and to see if the company had any need for an upgrade or additional software. This is an example of: A. transformational selling. B. aggressive selling. C. relationship selling. D. transaction selling. E. sales promotion. Answer: C Learning Objective: 02-06 Topic: Levels of Relationship Marketing Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: With relationship selling, the seller contacts customers after the purchase to determine if they are satisfied and have future needs. With transaction selling, customers are sold to and not contacted again.Chapter 02 - Relationship Marketing: Where Personal Selling Fits 2-28 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 75. When you visit a gift shop while on vacation, your purchase of a T-shirt would be an example of _____ selling. A. team B. relationship C. partnership D. consultative E. transaction Answer: E Learning Objective: 02-06 Topic: Levels of Relationship Marketing Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: With transaction selling, customers are sold to and not contacted again, as when purchasing a t-shirt while on vacation. Relationship selling involves the seller contacting customers after the purchase to determine if they are satisfied and have future needs. 76. Which type of selling would most likely be used when a firm sells low-priced products to customers who are geographically dispersed? A. Benefit selling B. Relationship selling C. Partnering D. Team-based E. Transaction selling Answer: E Learning Objective: 02-06 Topic: Levels of Relationship Marketing Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Transaction selling is common for firms that sell low-priced, low-profit products to geographically dispersed customers. It would be difficult and costly to conduct customer follow-up in such situations. 77. Through use of ________, marketers can determine the customers with whom they wish to build a partnering relationship. A. the principle of unbundling B. benefit maximization C. the 80/20 principle D. value-driven marketing E. the iceberg principle Answer: C Learning Objective: 02-06 Topic: Levels of Relationship Marketing Blooms: UnderstandChapter 02 - Relationship Marketing: Where Personal Selling Fits 2-29 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Medium Explanation: The 80/20 principle states that 80 percent of sales often come from 20 percent of a company’s customers. Organizations realize the need to identify their most important customers and designate them for their partnering programs. 78. Which term refers to the process of helping the customer achieve strategic goals through use of the seller's good and/or service? A. Consultative selling B. Transactional selling C. Aggressive selling D. Telemarketing selling E. One-time selling Answer: A Learning Objective: 02-07 Topic: The New Consultative Selling Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Consultative selling is the process of helping the customer achieve strategic short- and long-term goals through the use of the seller’s good and/or service. 79. In the role of team leader, the consultative salesperson: A. can be called a "lone ranger." B. encourages business that is not in the customer's long-term interest. C. brings together all the organization's resources for the customer. D. expects customers to provide all the confidential information before making purchase recommendations. E. considers his/her job complete once the sale is over. Answer: C Learning Objective: 02-07 Topic: The New Consultative Selling Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: In the role of team leader, the salesperson coordinates all of the information, resources, and activities needed to support customers before, during, and after the sale. The team leader works to bring together all of the organization’s resources for the customer.Chapter 02 - Relationship Marketing: Where Personal Selling Fits 2-30 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 80. _____ are composed of multifunctional specialists who ensure that their organizations convey their needs to the seller and evaluate the accuracy of the supplier's recommendations. A. Buying teams B. Focus groups C. Executive juries D. Customer advisors E. Selling teams Answer: A Learning Objective: 02-07 Topic: The New Consultative Selling Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Buying teams are composed of multifunctional specialists who ensure that their organizations accurately convey their complex needs to the seller and thoroughly assess the accuracy of the supplier’s recommendations. 81. In the role of business consultant, the consultative salesperson: A. works alone to prepare a financial strategy for global clients. B. is a persuasive peddler focused on convincing customers to buy products. C. serves as a primary contact between the CEOs of the selling and buying firms. D. expects the customer to provide technical support and advice for all e-sales calls. E. uses internal and external resources to understand a customer's business and marketplace. Answer: E Learning Objective: 02-07 Topic: The New Consultative Selling Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: As a business consultant, the salesperson gives advice and service. The salesperson uses internal and external resources to gain an understanding of the customer’s business and marketplace. 82. As a long-term ally, the consultative salesperson: A. analyzes and develops diversification strategies for customers. B. coordinates information and resources for customer support activities. C. asks customers for confidential data before making purchase recommendations. D. recommends promotion techniques for the customer that will benefit both parties. E. helps customers carry out fact-finding missions within the customer's company. Answer: E Learning Objective: 02-07 Topic: The New Consultative Selling Blooms: Understand AACSB: AnalyticChapter 02 - Relationship Marketing: Where Personal Selling Fits 2-31 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: In the role of long-term ally, the salesperson acts as a helper in meeting the customer’s needs. The salesperson “goes to bat” for customers with the seller’s employer whenever necessary and helps customers carry out fact-finding missions within the customer’s company. 83. How are modern day salespeople different from those in the past? A. Modern day salespeople are required to be increasingly product-oriented. B. In the past, most salespeople focused time on building the relationship gap. C. Modern day salespeople can improve sales and service performance with technology. D. In the past, most salespeople strived to build long-term relationships with key customers. E. Global competition is pushing modern salespeople to be persuasive peddlers to maximize profit. Answer: C Learning Objective: 02-02 Topic: E-Selling: Technology and Information Build Relationships Blooms: Understand AACSB: Technology Level of Difficulty: Medium Explanation: Technology has exploded the boundaries of today’s knowledge frontiers, so modern salespeople have access to almost any conceivable piece of information or data. Technology is making it possible to improve a person’s sales and service performance. 84. A supermarket chain was negotiating with a manufacturer of different types of meat grinders. Before the sale, the chain's management was impressed with the service they received from the salesperson. After the sale, however, when the blade on the frozen block grinder broke, it took them two weeks to locate the sales representative. Which of the following is illustrated in this example? A. Short-term ally B. Relationship gap C. Value-added benefit D. Customer partnership E. Consultative selling Answer: B Learning Objective: 02-07 Topic: The New Consultative Selling Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: It is common for a salesperson’s interest in the customer to decline after the sale, as in this example. This difference between the salesperson’s pre- and post-sale concern for the customer is referred to as the relationship gap.Chapter 02 - Relationship Marketing: Where Personal Selling Fits 2-32 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 85. According to the text, the key to profitable company performance is: A. knowing and satisfying target customers with competitively superior products and service. B. relying on publicity to create product awareness and minimizing customer service. C. exhibiting a commitment by corporate leaders to curb the instincts of capitalism. D. realizing the good luck of having popular products in a non-recessional economy. E. relying on traditional methods of gathering information rather than technology. Answer: A Learning Objective: 02-05 Topic: The Key to Success Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Consumer and business buyers face an abundance of suppliers seeking to satisfy their every need. The key to profitable company performance is knowing and satisfying target customers with competitively superior products and service. Marketing is the company function that defines not only customer targets but also the best way to satisfy their needs and wants competitively and profitably. Coca-Cola For decades, people in Rome, Georgia, drank more Coca-Cola per capita than anywhere else in the world. That success has been attributed to the Barron family who were the local bottlers for Coke products. The Barrons believe that their success was due to customer loyalty. Through most of the twentieth century, the bottler cultivated small retailers and worked hard, selling Coke from stores to schools to doorsteps. The personal service is remembered by people who grew up in Rome. When someone passed away, the Coke salesperson would leave a couple of cases on the deceased's family's front porch. 86. Because the Rome Coke bottler stressed the wants of the buyers, it is obvious that it was a supporter of: A. team selling. B. social responsibility. . C. the marketing concept. D. the production concept. E. non-consumer marketing. Answer: C Learning Objective: 02-01 Topic: Customer Orientation’s Evolution Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The Rome Coke bottler most likely adhered to the marketing concept. The bottler’s planning and operations were customer oriented and marketing activities were organizationally coordinated.Chapter 02 - Relationship Marketing: Where Personal Selling Fits 2-33 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 87. In Rome, the small retailers that sold Coke products were an important part of the _____ element of the marketing mix. A. price B. production C. product D. promotion E. distribution Answer: E Learning Objective: 02-04 Topic: Essentials of a Firm’s Marketing Effort Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The Rome Coke bottler sold its products to resellers, which in this case were small stores. The retailers acted as Coke distributors by buying and selling Coke products. 88. In Rome, the Coke salesperson was an important member of the _____ element of the marketing mix. A. price B. production C. product D. promotion E. distribution Answer: D Learning Objective: 02-04 Topic: Essentials of a Firm’s Marketing Effort Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Salespeople are components of the promotion aspect of the marketing mix. The Coke salesperson used personal selling to persuade retailers and individuals to purchase Coke products. 89. The Coke bottlers in Rome most likely instructed the firm’s sales force to use: A. transactional marketing. B. relationship marketing. C. loyalty exchanges. D. distribution licensing. E. transformational selling. Answer: B Learning Objective: 02-06 Topic: Essentials of a Firm’s Marketing Effort Blooms: Understand AACSB: AnalyticChapter 02 - Relationship Marketing: Where Personal Selling Fits 2-34 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: Relationship marketing is the creation of customer loyalty, and it was key to the success of the Rome Coke bottler. Organizations use combinations of products, prices, distributions, promotions, and services to achieve this goal. Relationship marketing is based on the idea that important customers need continuous attention. 90. The gift of cases of Cokes to families is one indication of how the Rome bottler provided a high level of _____ that led the citizens of Rome to become loyal Coke drinkers. A. service quality B. empowerment C. sales collaboration D. post-sales service E. quality control Answer: A Learning Objective: 02-06 Topic: Relationship Marketing and the Sales Force Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Service quality is a subjective satisfaction assessment that customers arrive at by comparing the service level they believe an organization ought to deliver to the service level that they perceive being delivered. Coke customers were highly satisfied and loyal due to the service provided by the bottler. Essay Questions 91. According to the text, what are the primary goals and the purpose of business? Answer: The purpose of business is to increase the general well-being of humankind through the sale of goods and services. This requires making a profit in order to operate the business and provide beneficial products to the marketplace. Profit is a means to an end. Reduced to basics, businesses have two major functions: production of goods or creation of services and marketing those goods and services. The primary goal of business should be to transform the marketplace and workplace into an environment where everyone is treated as they would like to be treated. Business should be fair to all parties involved in both the buying and selling of goods and services. Learning Objective: 02-01 Topic: What Is the Purpose of Business? Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 02 - Relationship Marketing: Where Personal Selling Fits 2-35 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 92. What is marketing? Describe the evolution of the consumer-oriented attitude. Answer: Marketing is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large. Before the Great Depression of the 1930s, few firms had marketing departments and many did not even have a formal sales department. Production and engineering shaped the company's objectives and planning. America bought what was produced. By the 1940s, it was clear that the attitude and needs of the consumer had changed. World War II created shortage of goods and services. A few years after the war, consumers had many products to choose from and firms found they had to go to the consumer instead of waiting for consumers to buy. Salespeople, armed with very unsophisticated selling techniques, were asked to contact potential customers and take their orders. Salespeople had to rely on natural ability to give sales presentations. However, as time passed, businesses found that they had to become market oriented rather than sales oriented. Beginning in the 1950s, marketing, rather than selling, became the focus of business sales activities. Learning Objective: 02-02 Topic: Customer Orientation’s Evolution Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 93. List the three fundamental beliefs that underlie the marketing concept as a business philosophy. Answer: The marketing concept has three fundamental beliefs: (1) All company planning and operations should be customer oriented. (2) The goal of the firm should be profitable sales volume and not just volume for the sake of volume alone. (3) All marketing activities in a firm should be organizationally coordinated. The marketing concept is a business philosophy that says the customers' want satisfaction is the economic and social justification for a firm's existence. Consequently, all company activities should be devoted to determining customers' wants and then satisfying them, while still making a profit. Learning Objective: 02-01 Topic: What Is Marketing? Blooms: UnderstandChapter 02 - Relationship Marketing: Where Personal Selling Fits 2-36 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Medium 94. List the four basic objectives of marketers. Answer: Marketing considerations should be the most critical factor guiding all short-range and long-range planning in any organization. Marketing people typically have these four basic objectives to accomplish: (1) Maximize the sales of existing products in existing markets, (2) Develop and sell new products, (3) Develop new markets for existing or new products, and (4) Provide the quality of service necessary for customers to continue doing business with the organization. Learning Objective: 02-03 Topic: Marketing’s Importance in the Firm Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 95. The text divides customers into three general categories. List and explain them. Answer: Customers fall into one of three groups: (1) households, (2) firms, and (3) governments. Households: A household refers to a decision-making unit buying for personal use. Every individual in the economy belongs to a household. Firms: A firm is an organization that produces goods and services. All producers are called firms, no matter how big they are or what they produce. Firms can be for-profit or nonprofit. Government: A government is an organization that has two functions: the provision of goods and services to households and firms and the redistribution of income and wealth. Government buys billions of dollars each year of all types of products. Thus, a firm and government are both organizations. Learning Objective: 02-04 Topic: Essentials of a Firm’s Marketing Effort Blooms: UnderstandChapter 02 - Relationship Marketing: Where Personal Selling Fits 2-37 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Medium 96. List and briefly explain the four components of promotion. Answer: Promotion, as part of the marketing mix, increases company sales by communicating product information to potential customers. The four basic parts of a firm's promotional effort are: (1) Personal selling: Personal communication of information to unselfishly persuade a customer to buy something that satisfies an individual's needs. (2) Advertising: Nonpersonal communication of information paid for by an identified sponsor such as an individual or an organization. (3) Public relations: Nonpersonal communication of information that is not paid for by an individual or organization. (4) Sales promotion: Involves activities or materials used to create sales for goods or services. The two types of sales promotion are consumer and trade sales promotion. Learning Objective: 02-04 Topic: Essentials of a Firm’s Marketing Effort Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 97. What is the goal of relationship marketing? Explain the three levels of relationship marketing. Answer: Relationship marketing is the creation of customer loyalty. An organization using relationship marketing wants to demonstrate to the customer that it has the capabilities to serve the account's need in a superior way, particularly if a committed relationship can be formed. The type of selling needed to establish a long-term collaborative relationship is complex. The three general levels of selling relationships with customers are: (1) Transaction selling: customers are sold to and not contacted again. (2) Relationship selling: the seller contacts customers after the purchase to determine if they are satisfied and have future needs. (3) Partnering: the seller works continually to improve its customers' operations, sales, and profits. Learning Objective: 02-06 Topic: Relationship Marketing Blooms: Understand AACSB: AnalyticChapter 02 - Relationship Marketing: Where Personal Selling Fits 2-38 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium 98. Why is it important for firms to build partnerships with customers? How does each party benefit? Answer: The ultimate outcome of relationship marketing is the building of a partnership between the seller and the buyer. The seller’s company works continuously to help the customer. As the customer prospers, so does the seller. Partnering encourages both buyer and seller to share information such as marketing research findings and production cost data. Their goal is to share risks and profits together. Partnering gives a whole new meaning to customer focus. Companies that put partnering into practice find they reduce or eliminate conflicts of interest between themselves and their clients. Those who work at partnering find that very quickly their sensitivity and responsiveness improve significantly. They begin to anticipate trends in their customers’ businesses. They begin to know their customers’ requirements almost before the customers do. Learning Objective: 02-05 Topic: Partnering with Customers Blooms: Apply AACSB: Analytic Level of Difficulty: HardChapter 02 - Relationship Marketing: Where Personal Selling Fits 2-39 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 99. The roles of a salesperson centers around what customers want from him/her. Explain the roles of a consultative salesperson. Answer: Consultative selling is the process of helping the customer achieve strategic shortand long-term goals through the use of the seller's good and/or service. The needs of the customer require the salesperson to take on the roles of team leader, business consultant, and long-term ally. (1) Team leader: In the role of team leader, the salesperson coordinates all of the information, resources, and activities needed to support customers before, during, and after the sale. The team leader works to bring together all of the organization's resources for the customer. The salesperson serves as the primary contact between the buyer and seller's organizations and makes the customer aware of the network of resources that stand behind the salesperson. (2) Business consultant: As a business consultant, the salesperson gives advice and service. The salesperson uses internal and external resources to gain an understanding of the customer's business and marketplace. They often must collect confidential information and data before being able to make purchase recommendations. (3) Long-term ally: In the role of long-term ally, the salesperson acts as a helper in meeting the customer's needs. The salesperson's goal is to create a win-win situation. As the customer's sales and profits grow, so do the salesperson's. Thus, the salesperson presents goods and services honestly and turns down business that is not in the customer's long-term interest. The salesperson "goes to bat" for customers with the seller's employer whenever necessary and helps customers carry out fact-finding missions within the customer's company. The ability of a salesperson to fulfill the role of long-term ally is a pivotal factor in determining whether a sales interaction is just a transaction or the beginning of a relationship. Learning Objective: 02-07 Topic: The New Consultative Selling Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 02 - Relationship Marketing: Where Personal Selling Fits 2-40 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 100. What is the key to an organization's success? Answer: Companies cannot survive today by simply doing a good job. They must do an excellent job if they are to succeed in the increasingly competitive global marketplace. Consumer and business buyers face an abundance of suppliers seeking to satisfy their every need. The key to profitable company performance is knowing and satisfying target customers with competitively superior products and service. Marketing is the company function that defines not only customer targets but also the best way to satisfy their needs and wants competitively and profitably. Marketing's main customer contacts are salespeople. Because salespeople know how to produce sales, profits, and customer satisfaction, they are critical to being successful in today's fierce competitive battles in the marketplace. Learning Objective: 02-02 Topic: The Key to Success Blooms: Apply AACSB: Analytic Level of Difficulty: HardChapter 03 - Ethics First… Then Customer Relationships 3-1 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Chapter 03 Ethics First… Then Customer Relationships Learning Objectives: 03-01 Explain what influences ethical behavior. 03-02 Define management’s ethical responsibilities. 03-03 Discuss ethical dealings among salespeople, employers, and customers. 03-04 Describe the international side of ethics. 03-05 Explain what is involved in managing sales ethics. 03-06 Write a short essay on the components of the Golden Rule and how it relates to sales ethics. True / False Questions 1. The world views and belief systems of employees from the same country are typically identical. Answer: False Learning Objective: 03-01 Topic: What Influences Ethical Behavior? Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: No two people are alike because of varying personalities, religious backgrounds, and family and personal experiences. Even people from the same culture will have different ideas of right and wrong. 2. The ethical behavior of an employee is influenced by managers, co-workers, and the organization. Answer: True Learning Objective: 03-01 Topic: What Influences Ethical Behavior? Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: The ethical behavior of individual employees is influenced by the organization and by other people, such as co-workers and managers. Top management plays a significant role in the ethical decisions made by employees. 3. In most cases, an individual’s moral development becomes increasingly mature. Answer: True Learning Objective: 03-01 Topic: What Influences Ethical Behavior? Blooms: Remember AACSB: EthicsChapter 03 - Ethics First… Then Customer Relationships 3-2 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: Over time moral development gradually matures in many people. With moral maturity, many individuals—but not all—adhere to more truthful or stringent moral principles. 4. An individual in the pre-conventional stage of morality asks, “What can I get away with?” Answer: True Learning Objective: 03-01 Topic: What Influences Ethical Behavior? Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: At the pre-conventional moral development level, an individual acts in his or her own best interest and thus follows rules to avoid punishment or receive rewards. This individual would break moral and legal laws. 5. Individuals at the principled moral level base ethical decisions on laws and consequences. Answer: False Learning Objective: 03-01 Topic: What Influences Ethical Behavior? Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: At the principled moral development level, an individual lives by an internal set of morals, values, and ethics and would disobey laws to follow what he or she believes is right. At the conventional moral development level, an individual conforms to the expectations of others and legal laws. 6. Most sales people operate at the conventional level of moral development. Answer: True Learning Objective: 03-01 Topic: What Influences Ethical Behavior? Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: The majority of sales personnel, as well as people in general, operate at the conventional level. However, a few individuals are at level 1, and it is estimated that less than 20 percent of individuals reach level 3.Chapter 03 - Ethics First… Then Customer Relationships 3-3 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 7. Sales representatives at the preconventional moral development level would most likely be unconcerned about lying to customers if getting caught was unlikely. Answer: True Learning Objective: 03-01 Topic: What Influences Ethical Behavior? Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: Individuals at the preconventional moral development stage break moral and legal laws when they can get away with it. So, they probably would feel no concern about lying to a customer. 8. A sales executive makes decisions based upon what her boss says is right; this person is at the principled level of moral development. Answer: False Learning Objective: 03-01 Topic: What Influences Ethical Behavior? Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: At the conventional moral development level, an individual conforms to the expectations of others, such as family, friends, employer, boss, or society, and upholds moral and legal laws. A principled person bases decisions on internal morals and values. 9. Morals refer to people's adherence to right or wrong behavior and right or wrong thinking. Answer: True Learning Objective: 03-01 Topic: What Influences Ethical Behavior? Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: People’s morals are their adherence to right or wrong behavior and right or wrong thinking. As one thinks, one does. 10. The Golden Rule of Selling requires people whose personal character is at level 2. Answer: False Learning Objective: 03-01 Topic: What Influences Ethical Behavior? Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: Golden Rule salespeople are in Level 3, which involves making ethical and moral decisions as all costs. The salesperson does what is right not what is in his or her best interest.Chapter 03 - Ethics First… Then Customer Relationships 3-4 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 11. A fixed point of reference refers to something that provides the correct action to take in any situation and never gets tailored to fit an occasion. Answer: True Learning Objective: 03-01 Topic: Are There Any Ethical Guidelines? Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: A fixed point of reference refers to something that provides the correct action to take in any situation and never gets tailored to fit an occasion. This fixed point of reference must be separate from you; otherwise you will be changing the rules based upon your best interest in various situations. 12. Multiple world religions adhere to the Golden Rule. Answer: True Learning Objective: 03-01 Topic: Are There Any Ethical Guidelines? Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: Christians, Jews, Hindus, Buddhists, and Confucius’ followers embrace the Golden Rule, although each has its own interpretation. 13. Ethical behavior specifically refers to carrying out one's share of the work and responsibility with 100 percent effort. Answer: True Learning Objective: 03-02 Topic: Management’s Ethical Responsibilities Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: Ethical behavior refers to treating others fairly. Specifically, it refers to actions such as being honest and truthful, following the rules, and carrying your share of the work and responsibility with 100 percent effort. 14. An ethical dilemma arises in a situation when each alternative choice has some undesirable elements due to potentially negative ethical consequences. Answer: True Learning Objective: 03-02 Topic: Management’s Ethical Responsibilities Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: Right and wrong are unclear in ethical dilemmas. Such situations are faced by managers regularly.Chapter 03 - Ethics First… Then Customer Relationships 3-5 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 15. If management decides to increase the number of territories in a state, there is a possibility the earnings of the salespeople working that state will decrease. Answer: True Learning Objective: 03-02 Topic: Ethics in Dealing with Salespeople Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: Management makes decisions that affect sales territories and salespeople. For example, the company might increase the number of sales territories, which often necessitates splitting a single territory, which takes customers away from a salesperson and reduces his or her earnings. 16. Today employers have the right to terminate salespeople for poor performance, excessive absenteeism, unsafe conduct, and poor organizational citizenship. Answer: True Learning Objective: 03-02 Topic: Ethics in Dealing with Salespeople Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: Due to the termination-at-will rule, employers have the right to terminate sales personnel for poor performance, excessive absenteeism, unsafe conduct, and poor organizational citizenship. It is crucial, however, for employers to maintain accurate records of these events for employees and to inform employees about where they stand. 17. The right to be free of sexual harassment is a part of the 1980 EEOC guidelines. Answer: True Learning Objective: 03-02 Topic: Ethics in Dealing with Salespeople Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: The right to be free of sexual harassment has been made a part of the 1980 EEOC guidelines, which state that sexual harassment is a form of sex discrimination. The designation of sexual harassment as a form of sex discrimination under Title VII also is found in numerous court decisions.Chapter 03 - Ethics First… Then Customer Relationships 3-6 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 18. Salespeople who split commissions with co-workers or take customers away from coworkers to win sales contests are engaged in moonlighting. Answer: False Learning Objective: 03-03 Topic: Salespeople’s Ethics in Dealing with Their Employers Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: Moonlighting occurs when an employee holds a second job or attends college classes during company time. 19. Eldon Hensley is a sales representative at Amass Innovations, a firm that manufactures tankless water heating systems. He gives travel certificates and gifts to purchasing executives who buy numerous products from him. This is an example of bribing. Answer: True Learning Objective: 03-03 Topic: Ethics in Dealing with Customers Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: Gifts and travel vouchers would most likely be viewed as bribes given in return for placing large orders. 20. If sales personnel loosely describe their product or service in glowing terms, the law treats these comments as statements of fact and warranties. Answer: False Learning Objective: 03-03 Topic: Ethics in Dealing with Customers Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: When sales personnel loosely describe their product or service in glowing terms, such statements are viewed as opinions rather than facts that the customer, supplier, or wholesaler generally cannot rely on. 21. The most often misused company assets are automobiles, expense accounts, samples, and damaged-merchandise credits. Answer: True Learning Objective: 03-03 Topic: Salespeople’s Ethics in Dealing with Their Employers Blooms: Remember AACSB: Ethics Level of Difficulty: EasyChapter 03 - Ethics First… Then Customer Relationships 3-7 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Company assets most often misused are automobiles, expense accounts, samples, and damaged-merchandise credits. All can be used for personal gain or as bribes and kickbacks to customers. 22. Generally, the more knowledgeable the customer, the greater the chances the court will interpret an incorrect statement by a salesperson as an actionable misrepresentation rather than as sales puffery. Answer: False Learning Objective: 03-03 Topic: Ethics in Dealing with Customers Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: There is a subtle difference between sales puffery and statements of fact; they can be difficult to distinguish. In general, the courts interpret a statement as actionable when a customer lacks knowledge about a product sold by a salesperson. 23. "This refrigerator will preserve foods in the warmest weather." This statement by a home appliance salesperson is legally actionable. Answer: True Learning Objective: 03-03 Topic: Ethics in Dealing with Customers Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: Salespeople should understand the distinction between general statements of praise and statements of fact made during the sales pitch (and the legal consequences). “This refrigerator will preserve foods in the warmest weather” would be legally actionable as a statement of fact. 24. Customers can recover damages on the grounds of breach of warranty and other contractual breach; however, customers cannot recover damages in cases of misrepresentation. Answer: False Learning Objective: 03-03 Topic: Ethics in Dealing with Customers Blooms: Understand AACSB: EthicsChapter 03 - Ethics First… Then Customer Relationships 3-8 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: When a customer relies on a salesperson’s statements, purchases the product or service, and then finds that it fails to perform as promised, the supplier can be sued for misrepresentation and breach of warranty . Companies around the United States have been liable for million-dollar judgments for making such mistakes, particularly when their salespeople sold high-ticket, high-tech products or services. 25. The Robinson-Patman Act of 1936 prevents sellers from granting quantity discounts to larger buyers. Answer: False Learning Objective: 03-03 Topic: Ethics in Dealing with Customers Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: The Robinson-Patman Act of 1936 allows sellers to grant what are called quantity discounts to larger buyers based on savings in manufacturing costs. 26. Donna buys two laptop computers for $2,000. Jackson buys 15 units of the same laptop computer for $12,000. This selling situation provides evidence for price discrimination. Answer: False Learning Objective: 03-03 Topic: Ethics in Dealing with Customers Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: Price discrimination refers to selling the same quantity of the same product to different buyers at different prices. The Robinson-Patman Act of 1936 allows sellers to grant what are called quantity discounts to larger buyers, such as Jackson, based on savings in manufacturing costs. 27. A cooling-off law gives the buyer three weeks to cancel the contract, return any merchandise, and obtain a full refund. Answer: False Learning Objective: 03-03 Topic: Ethics in Dealing with Customers Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: Cooling-off laws provide a cooling-off period (usually three days) in which the buyer may cancel the contract, return any merchandise, and obtain a full refund. The law covers sales of $25 or more made door-to-door. It also states that the buyer must receive from the seller a written, dated contract and/or receipt of the transaction and be told there is a threeday cancellation period.Chapter 03 - Ethics First… Then Customer Relationships 3-9 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 28. U.S. salespeople competing in foreign countries are required to comply with the laws of the foreign country rather than U.S. laws, which are not applicable overseas. Answer: False Learning Objective: 02-04 Topic: The International Side of Ethics Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: Each and every employee of a U.S. company is subject to U.S. law regardless of the country in which the business takes place. Even the agents or the distributors are subject to U.S. law. 29. The single most important factor in improving the climate for ethical behavior in a sales force is the existence of a detailed code of ethics. Answer: False Learning Objective: 03-05 Topic: Managing Sales Ethics Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: The single most important factor in improving the climate for ethical behavior in a sales force is the action taken by top-level managers. Sales managers must help develop and support their codes of ethics; however, a code of ethics by itself is not very influential 30. Green River ordinances require that industrial salespeople who sell complex machineries to organizations be licensed before approaching customers. Answer: False Learning Objective: 03-03 Topic: Ethics in Dealing with Customers Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: Many cities require persons selling directly to consumers to be licensed by the city in which they do business if they are not residents and to pay a license fee. These city ordinances often are called Green River ordinances.Chapter 03 - Ethics First… Then Customer Relationships 3-10 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 31. Principle-based statements generally outline the procedures to be used in specific ethical situations. Answer: False Learning Objective: 03-03 Topic: Managing Sales Ethics Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: Principle-based statements are designed to affect corporate culture, define fundamental values, and contain general language about company responsibilities, quality of products, and treatment of employees. Policy-based statements generally outline the procedures to be used in specific ethical situations. 32. A person who engages in whistle-blowing is called an ethics ombudsperson. Answer: False Learning Objective: 03-05 Topic: Managing Sales Ethics Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: An ethics ombudsperson is an official given the responsibility of corporate conscience who hears and investigates ethics complaints and informs top management of potential ethics issues. 33. Control systems that monitor and penalize the ethical behavior of salespeople are a useful tool in creating an ethical work environment. Answer: True Learning Objective: 03-05 Topic: Managing Sales Ethics Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: Control systems must be established to encourage ethical behavior. Methods should be employed to determine whether salespeople give bribes, falsify reports, or pad expenses. Dismissal, demotion, suspension, reprimand, and withholding of sales commissions would be possible penalties for unethical sales practices.Chapter 03 - Ethics First… Then Customer Relationships 3-11 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 34. Integrity and trust form the attributes that distinguish the organization and salesperson, often referred to as character. Answer: True Learning Objective: 03-06 Topic: Ethics in Business and Sales Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: Integrity and trust form the attributes that make up and distinguish the organization and salesperson, often referred to as character. Think of character as who you are when no one is looking and what you are willing to stand for when someone is looking. 35. Integrity, trust, and character are the building blocks of a Golden Rule salesperson’s values. Answer: True Learning Objective: 03-06 Topic: Golden Rule of Personal Selling Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: Integrity, trust, and character help form the values or moral code of conduct toward others. Respect for the dignity of the individual is at the heart of the universal moral code referred to as “the Golden Rule” by most people of the world. Multiple Choice Questions 36. Which term refers to the different beliefs people have about the world around them? A. Multiculturalism B. Social morals C. World ethics D. Worldview E. Citizenship Answer: D Learning Objective: 03-01 Topic: What Influences Ethical Behavior? Blooms: Remember AACSB: Analytic Level of Difficulty: EasyChapter 03 - Ethics First… Then Customer Relationships 3-12 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Because people have different beliefs about the world around them, referred to as a person’s worldview, they tend to have different views on ethics and morality. Morals refer to a person’s adherence to right or wrong behavior and thinking. 37. Which of the following factors has the LEAST influence on an individual’s core belief system? A. Physical appearance B. Religious background C. Family upbringing D. Life experiences E. Personality Answer: A Learning Objective: 03-01 Topic: What Influences Ethical Behavior? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Personality, religious background, family upbringing, personal experiences, and the situation faced are examples of factors shaping our core belief system. Physical appearance is less influential than the other factors on a person’s core beliefs. 38. Which of the following questions would most likely be asked by a person at the preconventional level of moral development? A. What can I get away with? B. What does my family want me to do? C. What am I legally required to do? D. What is the right thing to do? E. What does society expect from me? Answer: A Learning Objective: 03-01 Topic: What Influences Ethical Behavior? Blooms: Understand AACSB: Ethics Level of Difficulty: MediumChapter 03 - Ethics First… Then Customer Relationships 3-13 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: A person at the preconventional level makes decisions based on what he or she can get away with. A conventional level person is concerned about laws and the expectations of family and society. 39. Which of the following questions would most likely be asked by a person at the principled level of moral development? A. What does society expect from me? B. What is the right thing to do? C. What am I legally required to do? D. What does my family want me to do? E. What can I get away with? Answer: B Learning Objective: 03-01 Topic: What Influences Ethical Behavior? Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: A principled person does the right thing even if it goes against the law or people’s expectations. A person at the preconventional level makes decisions based on what he or she can get away with. A conventional level person is concerned about laws and the expectations of family and society. 40. According to the text, why do most employees in organizations succumb to questionable ethical standards or only follow formal policies? A. Most people are in the conventional and principled levels of moral development. B. Few organizations develop and enforce very stringent codes of ethics. C. Most people are in the preconventional and conventional levels of moral development. D. Few people in an organization are considered stakeholders or stockholders. E. Most people exhibit behavior that is close to the principled level of moral development. Answer: C Learning Objective: 03-01 Topic: What Influences Ethical Behavior? Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: The vast majority of people in our society are at the preconventional or conventional level. Therefore, most employees in an organization feel they must “go along to get along”; in other words, they acquiesce to questionable ethical standards to keep their jobs. At most, they only follow formal policies and procedures.Chapter 03 - Ethics First… Then Customer Relationships 3-14 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 41. According to a survey of adult Americans, people are most likely to base ethical and moral decisions on: A. legal outcomes. B. current situations. C. principles of justice. D. historical cultures. E. religious standards. Answer: B Learning Objective: 03-01 Topic: Are There Any Ethical Guidelines? Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: In a February 12, 2002, national poll, American adults said by a 3-to-1 margin that truth is always relative to a person’s situation. People are most likely to make their moral and ethical decisions on the basis of whatever feels right or comfortable in a situation. 42. An ongoing Barna Research study finds that all of the following are primary influences on the ethical and moral decision-making process of Americans EXCEPT: A. religion. B. books. C. the Internet. D. television. E. family. Answer: A Learning Objective: 03-01 Topic: What Influences Ethical Behavior? Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: Barna Research is conducting an ongoing study of sources influencing Americans’ ethical and moral decision-making processes. In early returns, Barna found the leading influencers in American society to be movies, television, the Internet, books, music, public policy and law, and family but not religion. 43. According to the text, your conscience is usually not the best guide for making moral and ethical decisions because it: A. is at the conventional level. B. remains too stationary. C. changes based on the situation. D. is too distant from the circumstances. E. relies on conflicting belief systems. Answer: C Learning Objective: 03-01 Topic: Are There Any Ethical Guidelines?Chapter 03 - Ethics First… Then Customer Relationships 3-15 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Blooms: Apply AACSB: Ethics Level of Difficulty: Hard Explanation: A fixed point of reference refers to something that provides the correct action to take in any situation and never gets tailored to fit an occasion. This fixed point of reference must be separate from you; otherwise you will be changing the rules based upon your best interest in various situations. This is why your conscience is usually not your best guide to making moral and ethical decisions. 44. All of the following would most likely eliminate the need for additional laws governing right and wrong in business settings EXCEPT: A. stringent codes of ethics. B. moral organizational cultures. C. ethical examples from top management. D. standardization of fixed points of reference. E. support for corporate social responsibility programs. Answer: D Learning Objective: 03-02 Topic: Management’s Ethical Responsibilities Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: As principles of ethics and social responsibility are more widely recognized, companies can use codes of ethics and their corporate cultures to govern behavior, thereby eliminating the need for additional laws governing right and wrong. A fixed point of reference is an individual’s tool for determining right and wrong and cannot be standardized.Chapter 03 - Ethics First… Then Customer Relationships 3-16 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 45. All of the following are characteristics of ethical behavior EXCEPT: A. being honest with customers. B. following company policies. C. showing loyalty to co-workers. D. treating customers and peers fairly. E. maintaining personal sales goals. Answer: E Learning Objective: 03-02 Topic: Management’s Ethical Responsibilities Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: Being honest, loyal, and fair are qualities of an ethical person as well as adhering to company policies. Maintaining sales goals is an action taken by hardworking employees, but it is not necessarily a characteristic of ethical behavior. 46. All of the following are involved in the majority of sales people’s ethical issues EXCEPT: A. co-workers. B. managers. C. customers. D. friends. E. employers. Answer: D Learning Objective: 03-02 Topic: Management’s Ethical Responsibilities Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: Most ethical issues that sales personnel face involve other salespeople, employers, managers, and customers. 47. On the job, Jack acts purely in his own best interest. He follows company rules only to avoid being fired. At what level of moral development is Jack most likely functioning? A. Unrestricted B. Principled C. Conventional D. Mature E. Preconventional Answer: E Learning Objective: 03-01 Topic: What Influences Ethical Behavior? Blooms: UnderstandChapter 03 - Ethics First… Then Customer Relationships 3-17 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Ethics Level of Difficulty: Medium Explanation: At the preconventional moral development level, an individual acts in his or her own best interest and thus follows rules to avoid punishment or receive rewards. 48. Which of the following terms refers to an extra-large customer that generates significantly more revenue for a salesperson than other customers? A. Balanced account B. Outsourced account C. Retail account D. House account E. Key account Answer: E Learning Objective: 03-03 Topic: Ethics in Dealing with Salespeople Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Key accounts are those that involve extra-large customers and generate a great deal of sales. House accounts are handled by a salesperson from the home office. 49. Paula considers herself to be a responsible person. She upholds moral and legal laws and conforms to the expectations of others. Paula is functioning at what level of moral development? A. Unrestricted B. Principled C. Mature D. Conventional E. Preconventional Answer: D Learning Objective: 03-01 Topic: What Influences Ethical Behavior? Blooms: Understand AACSB: EthicsChapter 03 - Ethics First… Then Customer Relationships 3-18 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: At the conventional moral development level, an individual conforms to the expectations of others, such as family, friends, employer, boss, or society, and upholds moral and legal laws. 50. A salesperson has been given the intellectual property of a competitor. The salesperson, who is uncertain how to handle the situation, seeks the guidance of an attorney. The salesperson is most likely operating at which level of moral development? A. Philanthropic B. Principled C. Conventional D. Restricted E. Preconventional Answer: C Learning Objective: 03-01 Topic: What Influences Ethical Behavior? Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: At the conventional moral development level, an individual conforms to the expectations of others, such as family, friends, employer, boss, or society, and upholds moral and legal laws. A salesperson at this level might ask, “What am I legally required to do?” when making an ethical or moral decision. 51. An individual operating in the _____ level of moral development would disobey orders, laws, and consequences to follow personal ethics and values. A. voluntary B. principled C. conventional D. habitual E. preconventional Answer: B Learning Objective: 03-01 Topic: What Influences Ethical Behavior? Blooms: Remember AACSB: EthicsChapter 03 - Ethics First… Then Customer Relationships 3-19 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: At the principled moral development level, an individual lives by an internal set of morals, values, and ethics regardless of punishments or majority opinion. The individual would disobey orders, laws, and consequences to follow what he or she believes is right. 52. The majority of sales personnel operate at the _____ level of moral development. A. intentional B. principled C. discretionary D. conventional E. preconventional Answer: D Learning Objective: 03-01 Topic: What Influences Ethical Behavior? Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: The majority of sales personnel, as well as people in general, operates at the conventional level. However, a few individuals are at level 1, and it is estimated that less than 20 percent of individuals reach level 3. 53. The person who operates at the _____ level of moral development would adhere to the Golden Rule of Selling. A. intentional B. principled C. conventional D. discretionary E. preconventional Answer: B Learning Objective: 03-01 Topic: What Influences Ethical Behavior? Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: The principled individual disobeys orders, laws, and consequences to follow internal morals, values, and ethics. This person follows the Golden Rule. 54. Which of the following is LEAST likely an ethical issue faced by most sales managers? A. Employee rights B. Sales territories C. Sales pressure D. Benefits flexibility E. Personnel substance abuse Answer: D Learning Objective: 03-03Chapter 03 - Ethics First… Then Customer Relationships 3-20 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Topic: Ethics in Dealing with Salespeople Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: Five ethical considerations sales managers face are the level of sales pressure to place on a salesperson, decisions concerning a salesperson’s territory, whether to be honest with the salesperson, what to do with an ill salesperson, and employee rights. Employee benefits are unlikely to cause ethical dilemmas for sales managers. 55. A(n) _____ would tell Quinton that he should return unauthorized competitive information to its owner without examining it, even though the information would more than likely result in a large commission for Quinton. A. fixed point of reference B. employee rights clause C. mandatory cooling off period D. preconventional moral maturity E. directional code of ethics Answer: A Learning Objective: 03-01 Topic: Are There Any Ethical Guidelines? Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: A fixed point of reference refers to something that provides the correct action to take in any situation and never gets tailored to fit an occasion. This fixed point of reference must be separate from you; otherwise you will be changing the rules based upon your best interest in various situations. 56. A _____ refers to something that provides the correct action to take in any situation and never gets tailored to fit an occasion. A. conventional moral maturity B. point of convenient reference C. directional code of ethics D. fixed point of reference E. frame of conventionality Answer: D Learning Objective: 03-01 Topic: Are There Any Ethical Guidelines? Blooms: Remember AACSB: AnalyticChapter 03 - Ethics First… Then Customer Relationships 3-21 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: A fixed point of reference refers to something that provides the correct action to take in any situation and never gets tailored to fit an occasion. This fixed point of reference must be separate from you; otherwise you will be changing the rules based upon your best interest in various situations. 57. In order to be effective, a fixed point of reference must: A. change rules based on the situation. B. be identical to personal beliefs. C. use one's own conscience. D. relate to objects rather than people. E. be separate from the individual. Answer: E Learning Objective: 03-01 Topic: Are There Any Ethical Guidelines? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A fixed point of reference refers to something that provides the correct action to take in any situation and never gets tailored to fit an occasion. This fixed point of reference must be separate from you; otherwise you will be changing the rules based upon your best interest in various situations. 58. Ethical behavior: A. refers to following the rules and treating others fairly. B. refers to a firm’s economic level of social responsibility. C. assumes that the individual is operating at an unrestricted moral level. D. assumes that human interactions are primarily reciprocal. E. refers to the devotion to a generic religious or social principle. Answer: A Learning Objective: 03-02 Topic: Management’s Ethical Responsibilities Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: Ethical behavior refers to treating others fairly. Specifically, it refers to being honest and truthful, maintaining confidence and trust, following the rules, and treating others fairly.Chapter 03 - Ethics First… Then Customer Relationships 3-22 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 59. Which of the following occurs when the right or wrong decision cannot be clearly identified? A. Ethical standardization B. Immoral behavior C. Sales pressure D. Ethical dilemma E. Social responsibility Answer: D Learning Objective: 03-02 Topic: Management’s Ethical Responsibilities Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: An ethical dilemma arises in a situation when each alternative choice or behavior has some undesirable elements due to potentially negative ethical or personal consequences. Right or wrong cannot be clearly identified. 60. Which of the following would most likely trigger an ethical dilemma? A. Excessively codified ethical standards B. Culturally different business practices C. Long-term organizational loyalties D. Productivity-based bonuses E. Detail sales representatives Answer: B Learning Objective: 03-02 Topic: Management’s Ethical Responsibilities Blooms: Understand AACSB: EthicsChapter 03 - Ethics First… Then Customer Relationships 3-23 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: An ethical dilemma arises in a situation when each alternative choice or behavior has some undesirable elements due to potentially negative ethical or personal consequences. In some cultures, it is considered a normal business practice to pay bribes to government officials, which may cause ethical dilemmas for U.S. salespeople. 61. A company decides to split one of its high-performing territories into two. The company has also decided to retain the existing salesperson for working in one of the territories and to appoint a new salesperson for the other. This decision would most likely result in the unethical treatment of: A. the existing salesperson in the territory. B. the new salesperson appointed to the territory. C. the key accounts in the territory. D. the customers in the sales territory. E. the wholesalers in the territory. Answer: A Learning Objective: 03-03 Topic: Ethics in Dealing with Salespeople Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: The original salesperson in the territory would feel mistreated. The salesperson may have spent years building the territory to its current sales volume only to have customers taken away and given to a new salesperson. If the salesperson has worked on commission, this would mean a decrease in earnings. 62. Sharon, a salesperson for a greeting card company, is responsible for sales in the northern part of California. Sharon’s manager has decided to change Sharon’s key account in the territory to a house account. Why would Sharon most likely dislike this decision? A. Sharon will have to monitor the key account for less pay than she usually earns. B. Sharon will be demoted from her position in the territory for losing the key account. C. Sharon will have to share commissions from the key account with the home office. D. Sharon will lose the commission for the key account. E. Sharon will have to work from the firm’s home office. Answer: D Learning Objective: 02-03 Topic: Ethics in Dealing with Salespeople Blooms: Apply AACSB: Ethics Level of Difficulty: Hard Explanation: Key accounts are extra-large customers and generate a great deal of sales commissions for salespeople. House accounts are handled by a salesperson from the home office so that the firm does not have to pay sales commissions. Sharon will be upset because she is losing commissions for a large account.Chapter 03 - Ethics First… Then Customer Relationships 3-24 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 63. When a company determines that one of its sales staff has an addiction which affects his work, it would be most ethical for the company to: A. terminate the employee to convey a message to other employees. B. punish the employee with a salary cut and demotion. C. encourage the employee to seek professional help. D. encourage the employee to take a leave of absence. E. file a lawsuit against the employee to cover the liability. Answer: C Learning Objective: 03-03 Topic: Management’s Ethical Responsibilities Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: The most ethical choice is to encourage the worker to seek professional help for the addiction. Terminating, punishing, or suing the worker would not help the employee battle the drug problem, although such actions may be required in the future. 64. Which term refers to the rights desired by employees regarding their job security and treatment by employers? A. Cultural acceptance B. Human rights C. Affirmative action D. Employee rights E. Workers’ compensation Answer: D Learning Objective: 03-03 Topic: Ethics in Dealing with Salespeople Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Employee rights are rights desired by employees regarding their job security and their treatment by employers while on the job, irrespective of whether those rights are currently protected by law or collective bargaining agreements of labor unions. 65. Suzanne, a sales representative at MedEx, a pharmaceutical firm, was being sexually harassed by her manager, Phil. After Suzanne refused to submit to Phil’s advances, he threatened to fire her. Suzanne can most likely sue MedEx based on which type of sexual harassment? A. Hostile environment B. Cooperative acceptance C. De facto termination D. Quid pro quo E. Employment-at-will Answer: D Learning Objective: 03-03Chapter 03 - Ethics First… Then Customer Relationships 3-25 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Topic: Ethics in Dealing with Salespeople Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: Suzanne could sue based on quid pro quo, which is when an employee who refuses to submit to a superior’s sexual advances is threatened with dismissal or other sanctions. The second type of sexual harassment is hostile environment harassment; it occurs when jokes, graffiti, and other behavior are directed at persons of the opposite sex. 66. Cooperative acceptance supports: A. termination of employees at the will of the employer. B. the right of the employees to be free of sexual harassment. C. price discrimination as a legal activity. D. free market competition which benefits consumers. E. the ethical treatment of employees with drug or alcohol addictions. Answer: B Learning Objective: 03-03 Topic: Ethics in Dealing with Salespeople Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: Cooperative acceptance refers to the right of employees to be treated fairly and with respect regardless of race, sex, national origin, physical disability, age, or religion while on the job (as well as in obtaining a job and maintaining job security). Not only does this mean that employees have the right not to be discriminated against in employment practices and decisions, but it also means that employees have the right to be free of sexual and racial harassment. 67. Which of the following would be an example of a salesperson who is moonlighting unethically? A. A retail sales clerk who works Monday through Friday and is taking a weekend MBA program. B. A building supply salesperson who sells vacation real estate on company time. C. A travel agent who sells antiques on the Internet during the weekends. D. A fire equipment salesperson who demonstrates her equipment to prospects by setting real fires. E. A retail ad salesperson who tells his wife when store sales are scheduled before they are announced to the public. Answer: B Learning Objective: 03-03 Topic: Salespeople’s Ethics in Dealing with Their Employers Blooms: Understand AACSB: Ethics Level of Difficulty: MediumChapter 03 - Ethics First… Then Customer Relationships 3-26 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Moonlighting occurs when an employee takes a second job or attends classes on company time. Employees who work second jobs or take classes during their off hours are not moonlighting. 68. Which of the following sales personnel activities is considered ethically acceptable? A. Splitting commissions with fellow employees to win a sales contest B. Taking a family vacation and writing it off on an expense account C. Working a second job during company time to earn additional income D. Calling in sick to prepare for a test in a college course later in the day E. Giving a $10 dollar gift to a $10,000 customer Answer: E Learning Objective: 02-03 Topic: Salespeople’s Ethics in Dealing with Their Employers Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: Cheating to win a sales contest, misusing company assets, and moonlighting are unethical actions. Giving a small gift to a big customer is most likely not a bribe. 69. Which of the following statements about bribery is most likely true? A. Bribes always involve money. B. Bribery accounts for more than half of all white-collar crimes in the U.S. C. Commissioned salespeople cannot be bribed because of the commission system. D. The difference between a business gift and a bribe is quite clear. E. Bar bills, meals, and entertainment are always considered bribes. Answer: B Learning Objective: 02-03 Topic: Ethics in Dealing with Customers Blooms: Understand AACSB: Ethics Level of Difficulty: MediumChapter 03 - Ethics First… Then Customer Relationships 3-27 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: The U.S. Chamber of Commerce estimates that bribes and kickbacks account for $27 billion of the annual $50 billion in white collar crime. Bribes, which can involve gifts and travel, are often hard to detect because in some cases they may be legitimate gifts. 70. When a customer relies on a salesperson's statements, purchases the product, and then finds that it fails to perform as promised, the supplier can be sued for: A. reciprocity. B. tie-in sales practice. C. sales discrimination. D. misrepresentation. E. sales restriction. Answer: D Learning Objective: 03-03 Topic: Ethics in Dealing with Customers Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: When a customer relies on a salesperson’s statements, purchases the product or service, and then finds that it fails to perform as promised, the supplier can be sued for misrepresentation and breach of warranty. 71. Which of the following statements, if false, would most likely have legal consequences? A. "You're going to love this new mattress!" B. "We are the metropolitan area's low price leader." C. "We offer a 100 percent order-fill rate; you'll never experience a back-order." D. "Our employees have extensive training in how to pamper our customers." E. "Your own mother can't care for you as well as our staff!" Answer: C Learning Objective: 03-03 Topic: Ethics in Dealing with Customers Blooms: Apply AACSB: Ethics Level of Difficulty: Hard Explanation: Making claims or predictions about specific results can lead to misrepresentation lawsuits if failure to uphold the claim occurs. Exaggerations are considered sales puffery and are typically not upheld by the law as statements of fact.Chapter 03 - Ethics First… Then Customer Relationships 3-28 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 72. Which of the following statements about misrepresentation is most likely true? A. When salespeople loosely describe their product or service in glowing terms, those statements can be relied upon by the potential buyer. B. Generally, the more knowledgeable the customer, the greater the chances the court will interpret an incorrect statement by a salesperson as an actionable misrepresentation. C. When a salesperson makes claims of a "factual nature" regarding a service's inherent capabilities, the law does not treat these comments as statements of fact and warranties. D. A salesperson's opinion about the quality of the product being sold is known as sales puffery and is legally actionable. E. Even if the salesperson misrepresentation statement is made innocently, many courts will award damages to the customer. Answer: E Learning Objective: 03-03 Topic: Ethics in Dealing with Customers Blooms: Analyze AACSB: Ethics Level of Difficulty: Hard Explanation: It’s generally easy for customers to recover damages on the grounds of misrepresentation and breach of warranty. In many states, this holds even when a salesperson’s statement is made innocently. Sales puffery typically does not lead to legal actions. 73. Which term refers to giving some customers promotional allowances and support while not making other customers aware of such opportunities? A. Customer discrimination B. Selective discounting C. Price discrimination D. Exclusive dealing E. Functional discounting Answer: C Learning Objective: 02-03 Topic: Ethics in Dealing with Customers Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Price discrimination refers to selling the same quantity of the same product to different buyers at different prices. This can be illegal if it injures or reduces competition and is considered unethical.Chapter 03 - Ethics First… Then Customer Relationships 3-29 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 74. A salesperson can minimize exposure to costly misrepresentation and breach of warranty lawsuits if the salesperson: A. never negotiates. B. avoids win-win sales situations. C. never sells customers more than they want. D. thoroughly educates customers before making a sale. E. offers opinions when customers ask what results to expect from a product. Answer: D Learning Objective: 03-03 Topic: Ethics in Dealing with Customers Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: A salesperson can minimize legal problems by educating customers about a product and its capabilities. Negotiating and offering opinions is not problematic for salespeople when done ethically and without exaggeration. 75. Sheridan decides to buy his first car. The car salesperson promises to arrange a car loan for him if he also purchases the auto insurance. This is a classic example of: A. misrepresentation. B. reciprocal selling. C. a Green River dealership. D. discriminatory selling. E. a tie-in sale. Answer: E Learning Objective: 03-03 Topic: Ethics in Dealing with Customers Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: Requiring a customer to buy one product when buying another product is known as a tie-in sale. Such actions are prohibited under the Clayton Act because they lessen competition. 76. Which of the following laws allows sellers to grant quantity discounts to larger buyers based on savings in manufacturing costs? A. Clayton Act B. Cooling-off laws C. Robinson-Patman Act D. Green River ordinances E. Civil Rights Act Answer: C Learning Objective: 03-03 Topic: Analytic Blooms: RememberChapter 03 - Ethics First… Then Customer Relationships 3-30 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Ethics Level of Difficulty: Easy Explanation: The Robinson-Patman Act of 1936 allows sellers to grant what are called quantity discounts to larger buyers based on savings in manufacturing costs. 77. If a video game manufacturer required its resellers to stock a line of games based on the financially-disappointing movie War of the Worlds in order to carry games based on the popular TV show Survivor, it would be an example of: A. misrepresentation. B. a tie-in sale. C. reciprocal selling. D. a Green River dealership. E. discriminatory selling. Answer: B Learning Objective: 03-03 Topic: Ethics in Dealing with Customers Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: Requiring a customer to buy one product when buying another product is known as a tie-in sale. Such actions are prohibited under the Clayton Act because they lessen competition. 78. The Clayton Act prohibits actions that would: A. prevent union formation. B. void product warranties. C. misrepresent product features. D. substantially lessen competition. E. limit the right to work. Answer: D Learning Objective: 03-03 Topic: Ethics in Dealing with Customers Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: To buy a particular line of merchandise, a buyer may be required to buy other, unwanted products. This is called a tie-in sale and is prohibited under the Clayton Act when it substantially lessens competition.Chapter 03 - Ethics First… Then Customer Relationships 3-31 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 79. Which of the following is illustrated if a contract requires that a wholesaler purchase products from one manufacturer? A. Reciprocity B. Exclusive dealership C. Product discrimination D. Deceptive slotting E. Price discrimination Answer: B Learning Objective: 03-03 Topic: Ethics in Dealing with Customers Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: When a contract requires that a wholesaler or retailer purchase products from one manufacturer, it is an exclusive dealership. If it lessens competition, it is prohibited under the Clayton Act. 80. What is reciprocity? A. Obeying the Golden Rule of Sales B. Creating win-win buying situations C. Sharing competitive intelligence with peers in the same industry D. Buying a product from someone if that person agrees to buy from you E. A mutually-beneficial buying situation that does not lessen competition Answer: D Learning Objective: 03-03 Topic: Ethics in Dealing with Customers Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Reciprocity involves agreeing to buy a product from one person if they return the favor. Reciprocity is considered illegal if it hurts competition. 81. Cooling-off laws apply only to: A. sales made in out-of-town offices, regardless of value. B. sales that include verbal guarantees. C. sales over $25 made door-to-door. D. sales over $50 made in hometown offices. E. sales over $100 made in hometown offices. Answer: C Learning Objective: 03-03 Topic: Ethics in Dealing with Customers Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 03 - Ethics First… Then Customer Relationships 3-32 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Cooling-off laws provide a cooling-off period (usually three days) in which the buyer may cancel the contract, return any merchandise, and obtain a full refund. The law covers sales of $25 or more made door-to-door. 82. Cooling-off laws: A. are meant to protect customers and are not limited by time. B. allow sellers to conceal sensitive information about products. C. are not applicable to low-value goods or door-to-door sales. D. have been adopted in all fifty states. E. allow time buyers to cancel contracts. Answer: E Learning Objective: 03-03 Topic: Ethics in Dealing with Customers Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Cooling-off claws provide a cooling-off period (usually three days) in which the buyer may cancel the contract, return any merchandise, and obtain a full refund. The law covers door-to-door sales of $25 or more. 83. A Green River ordinance states that: A. door-to-door sales are illegal unless being made for nonprofit organizations like schools and Girl Scouts. B. door-to-door salespersons who are not residents of the city in which they do business must purchase sales licenses. C. all persons selling directly to consumers must pay a bond. D. door-to-door sales are not allowed within city limits. E. all salespeople in a city must obtain a sales license. Answer: B Learning Objective: 03-03 Topic: Ethics in Dealing with Customers Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 03 - Ethics First… Then Customer Relationships 3-33 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Under Green River ordinances, cities require persons selling directly to consumers to be licensed by the city in which they do business if they are not residents and to pay a license fee. A bond also may be required in some places. 84. Which of the following statements about the international side of ethics is most likely true? A. Agents but not distributors for U.S. firms operating in foreign countries are required to comply with U.S. ethical standards. B. Those parts of the world that do not conform to U.S. ethical standards are limited to just three geographic areas. C. The vast majority of international companies have low ethical standards. D. Ethics related to employees operating overseas are typically clear and consistent. E. Every employee of a U.S. company is subject to U.S. law regardless of the country in which business is conducted. Answer: E Learning Objective: 03-04 Topic: The International Side of Ethics Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: Each and every employee of a U.S. company is subject to U.S. law regardless of the country in which the business takes place. Even the agents or the distributors are subject to U.S. law. 85. According to surveys, which of the following statements about how managers view sales ethics is true? A. Sales goals force managers to act even more ethically than they ordinarily would B. Some sales managers lower their ethical standards to meet job goals C. Few managers feel that they face ethical problems in the workplace D. Most managers are unaware of any unethical behavior in their industry E. Most managers feel that they and their employees are operating as ethically as possible Answer: b Learning Objective: 03-05 Topic: Managing Sales Ethics Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: Surveys show that most managers want to be more ethical but they sometimes lower their ethical standards to meet sales goals. All managers feel they face ethical problems, and most are aware of industry and company ethical issues.Chapter 03 - Ethics First… Then Customer Relationships 3-34 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 86. General statements of principle are often called: A. code of ethics. B. corporate credos. C. points of reference. D. cooperative acceptance. E. cooling-off laws. Answer: B Learning Objective: 03-05 Topic: Managing Sales Ethics Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: General statements of principle are often called corporate credos. Examples are GTE’s “Vision and Values,” Johnson & Johnson’s “The Credo,” and Hewlett-Packard’s “The HP Way.” 87. An ethics ombudsperson: A. is also called a whistle-blower. B. writes the company's code of ethics. C. interacts with stakeholders on a daily basis. D. handles all negative publicity for an organization. E. officially assumes the role of corporate conscience. Answer: E Learning Objective: 03-05 Topic: Managing Sales Ethics Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: An ethics ombudsperson is an official given the responsibility of corporate conscience that hears and investigates ethics complaints and informs top management of potential ethics issues. 88. Jason Montgomery, a hospital administrator in Montana, lodged a complaint against the hospital owners when he was asked to keep two sets of accounting records so that the hospital could reduce its tax liability. Montgomery was engaged in: A. preconventional moral development. B. ethical declarations of wrongdoing. C. consensual reporting. D. whistle-blowing. E. reciprocity. Answer: D Learning Objective: 03-05 Topic: Managing Sales Ethics Blooms: UnderstandChapter 03 - Ethics First… Then Customer Relationships 3-35 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Ethics Level of Difficulty: Medium Explanation: Employee disclosure of illegal, immoral, or illegitimate practices on the employer’s part is called whistle-blowing. Montgomery was asked to participate in a potentially unethical accounting practice, so he reported the practice to authorities, which made him a whistle-blower. 89. An ethics committee is typically: A. composed of employees from all functional areas and managerial levels. B. a nonessential organization in multinational corporations. C. assigned the task of writing employee handbooks. D. responsible for disciplining wrongdoers. E. charged with eliminating ethical dilemmas. Answer: D Learning Objective: 03-05 Topic: Managing Sales Ethics Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: An ethics committee is a group of executives appointed to oversee company ethics. The committee provides rulings on questionable ethical issues. The ethics committee assumes responsibility for disciplining wrongdoers. This responsibility is essential if the organization is to directly influence employee behavior. 90. According to the text, modern corporations seek salespeople with all of the following characteristics EXCEPT: A. character B. integrity C. synergy D. values E. trust Answer: C Learning Objective: 03-06 Topic: Ethics in Business and Sales Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: Salespeople with integrity, trustworthiness, character, and values are sought after and needed in today’s business world. Being able to work well with others is important in sales but less desirable than the other four components.Chapter 03 - Ethics First… Then Customer Relationships 3-36 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Essay Questions 91. What factors shape a person’s belief system? Answer: Personality, religious background, family upbringing, personal experiences, and the situation faced are examples of factors shaping our core belief system. Learning Objective: 03-01 Topic: What Influences Ethical Behavior? Blooms: Understand AACSB: Ethics Level of Difficulty: Medium 92. What are some common ethical situations that occur between salespeople and customers? What control systems can an employer implement to create an ethical sales climate? Answer: Some common problems sales personnel face include bribes, misrepresentation, price discrimination, tie-in sales, exclusive dealership, reciprocity, and sales restrictions. Control systems must be established to determine whether salespeople give bribes, falsify reports, or pad expenses. Dismissal, demotion, suspension, reprimand, and withholding of sales commissions would be possible penalties for unethical sales practices. Learning Objective: 03-03 Topic: Ethics in Dealing with Customers Blooms: Analyze AACSB: Ethics Level of Difficulty: Hard 93. What are the three levels of moral development? At what level do most salespeople operate? Answer: The three levels of moral development are:  Preconventional  Conventional  Principled The majority of sales personnel operate at the conventional level. Learning Objective: 03-01 Topic: What Influences Ethical Behavior? Blooms: Understand AACSB: EthicsChapter 03 - Ethics First… Then Customer Relationships 3-37 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium 94. Define ethical behavior. Provide specific examples of ethical behavior. Answer: Ethical behavior refers to treating others fairly. Specifically, it refers to:  Being honest and truthful  Maintaining confidence and trust  Following the rules  Conducting yourself in a proper manner  Treating others fairly  Demonstrating loyalty to the company and to associates  Carrying your share of the work and responsibility with 100 percent effort Learning Objective: 03-02 Topic: Management’s Ethical Responsibilities Blooms: Understand AACSB: Ethics Level of Difficulty: Medium 95. What steps can a company take to ensure that it maintains an ethical environment? Answer: Managers must take active steps to ensure that the company stays on ethical ground. Management methods for helping organizations be more responsive include (1) top management taking the lead, (2) carefully selecting leaders, (3) establishing and following a code of ethics, (4) creating ethical structures, (5) formally encouraging whistle-blowing, (6) creating an ethical sales climate, and (7) establishing control systems. Learning Objective: 03-05 Topic: Managing Sales Ethics Blooms: Apply AACSB: Ethics Level of Difficulty: HardChapter 03 - Ethics First… Then Customer Relationships 3-38 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 96. If the concept of ethics is so easy to understand, why do ethical dilemmas occur so frequently? Answer: Ethics set standards as to what is good or bad in conduct and decision making. Because these ethical standards are not classified, disagreements about proper behavior often occur. An ethical dilemma arises in a situation when each alternative choice or behavior has some undesirable elements due to potentially negative ethical or personal consequences. Right or wrong cannot be clearly identified. Learning Objective: 03-02 Topic: Management’s Ethical Responsibilities Blooms: Apply AACSB: Ethics Level of Difficulty: Hard 97. Discuss "termination-at-will" as it relates to employee rights. Answer: In the early and mid twentieth century, the courts upheld the rights of a company to fire employees at will. However, in the 1980s, the decisions began to favor employees. Companies have been put on notice that they need to keep accurate records and keep the employee notified of where they stand regarding job performance. Justifiable reasons for dismissal include poor job performance, excessive absenteeism, unsafe conduct, and poor organizational citizenship. It is also advisable for companies to have an established grievance procedure to ensure that due process has been maintained. This is especially true when the employee is a member of a protected group, such as those protected by Title VII, the Rehabilitation Act, or the Vietnam Era Veterans Act. Learning Objective: 03-03 Topic: Ethics in Dealing with Salespeople Blooms: Understand AACSB: Ethics Level of Difficulty: Medium 98. (p. 87-88) Imagine you sell automobiles. Develop a statement that is clearly an example of puffery. Develop a statement that could be interpreted as misrepresentation. What conditions would make this assignment easier? Answer: Puffery refers to the opinions that salespeople make when calling on customers. The following statement is an example of this: (1) "Our company's products are widely regarded as the best." A misrepresentation occurs when a salesperson makes claims or promises of a factual nature regarding a product's inherent capabilities. Examples include the following: (1) "You can depend on this car for the next 20 years." (2) "You don't have to worry about maintenance with a well-made car like this one." Due to the nature of this question, student answers will vary. Learning Objective: 03-03 Topic: Ethics in Dealing with Customers Blooms: Apply AACSB: Ethics Level of Difficulty: HardChapter 03 - Ethics First… Then Customer Relationships 3-39 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 99. What is price discrimination? Which law protects customers from price discrimination? Answer: Price discrimination refers to selling the same quantity of the same product to different buyers at different prices. The Robinson-Patman Act protects customers from price discrimination. Learning Objective: 03-03 Topic: Ethics in Dealing with Customers Blooms: Understand AACSB: Ethics Level of Difficulty: Medium 100. What is a code of ethics? Describe the two types of codes of ethics. Answer: A code of ethics is a formal statement of the company's values concerning ethics and social issues. It states those values or behaviors that are expected and those that are not tolerated. The two types of codes of ethics are principle-based statements and policy-based statements. Principle-based statements are designed to affect corporate culture, define fundamental values, and contain general language about company responsibilities, quality of products, and treatment of employees. Policy-based statements generally outline the procedures to be used in specific ethical situations. These situations include marketing practice, conflicts of interest, observance of laws, proprietary information, political gifts, and equal opportunities. Learning Objective: 03-05 Topic: Managing Sales Ethics Blooms: Understand AACSB: Ethics Level of Difficulty: MediumChapter 04 - The Psychology of Selling: Why People Buy 4-1 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Chapter 04 The Psychology of Selling: Why People Buy Learning Objectives: 04-01 Explain the differences between a feature, an advantage, and a benefit. 04-02 Construct a SELL Sequence. 04-03 Know when and how to use a trial close. 04-04 Explain why people buy benefits rather than features or advantages. 04-05 Enumerate techniques for determining a customer’s needs. 04-06 List factors that influence the customer’s buying decision. 04-07 Show why buying is a choice decision. True / False Questions 1. Needs and wants are the motivational forces behind human behavior. Answer: True Learning Objective: 04-06 Topic: Psychological Influences on Buying Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Human beings are motivated by needs and wants. These needs and wants build up internally, which causes people to desire to buy a product. People’s needs result from a lack of something desirable. Wants are needs learned by the person. 2. Economic needs refer to the buyer's need to purchase the least expensive product available. Answer: False Learning Objective: 04-06 Topic: Psychological Influences on Buying Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Economic needs are the buyer’s need to purchase the most satisfying product for the money. Economic needs include price, quality (performance, dependability, durability), convenience of buying, and service.Chapter 04 - The Psychology of Selling: Why People Buy 4-2 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 3. People with strong economic needs will consider only price in a purchase situation. Answer: False Learning Objective: 04-06 Topic: Psychological Influences on Buying Blooms: Understand AACSB: Analytic Level of Difficulty: Remember Explanation: Economic needs are the buyer’s need to purchase the most satisfying product for the money. Economic needs include price, quality (performance, dependability, durability), convenience of buying, and service. 4. A Golden Rule Salesperson is helpful and honest with customers unless that means losing sales. Answer: False Learning Objective: 04-06 Topic: The Golden Rule: Benefits Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: The Golden Rule of Sales places customers before personal gain at all times. Customers want to trust salespeople, and being ethical can build strong customer relationships. 5. In the stimulus-response model of consumer behavior, information about why consumers do or do not buy is hidden in the black box. Answer: True Learning Objective: 04-06 Topic: Why People Buy—The Black Box Approach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The stimulus-response model assumes that prospects respond in a predictable way to a sales presentation. However, the buyer’s decision-making process is unknown and referred to as the black box.Chapter 04 - The Psychology of Selling: Why People Buy 4-3 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 6. A product benefit is the performance characteristic of a product that describes how it can be used or how it will help the buyer. Answer: False Learning Objective: 04-01 Topic: A FABulous Approach to Buyer Need Satisfaction Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A product advantage is the performance characteristic of a product that describes how it can be used or will help the buyer. A product benefit is a favorable result the buyer receives from the product because of a particular advantage that has the ability to satisfy a buyer’s need. 7. When a salesperson says, "This glue will form a stronger bond than any other glue on the market," the salesperson is providing a product feature. Answer: False Learning Objective: 04-01 Topic: A FABulous Approach to Buyer Need Satisfaction Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: The salesperson is providing a product advantage instead of a feature. A product feature is any physical characteristic of a product, such as size, price, and uses. A product advantage is the performance characteristic of a product, such as a strong bond, that will help the buyer. 8. The salesperson should answer the prospect's question of "What's in it for me?" with a product advantage. Answer: False Learning Objective: 04-01 Topic: A FABulous Approach to Buyer Need Satisfaction Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: The salesperson is being asked about a product’s benefits rather than performance characteristics, which are product advantages. The salesperson should explain how the product will help the customer relax or convey an image of success. 9. Four levels of need awareness have been identified—conscious, preconscious, postconscious, and unconscious. Answer: False Learning Objective: 04-06 Topic: Psychological Influences on Buying Blooms: Remember AACSB: AnalyticChapter 04 - The Psychology of Selling: Why People Buy 4-4 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: Three levels of need awareness have been identified—conscious, preconscious, and unconscious. 10. A salesperson should stress a product's benefits more than its features and advantages because the product's benefits are what the customer will buy. Answer: True Learning Objective: 04-01 Topic: A FABulous Approach to Buyer Need Satisfaction Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: People focus more on benefits than features and advantages. Benefits may be practical or psychological. 11. The initial task of a salesperson when first meeting a potential customer is to differentiate between important buying needs and needs of lesser or no importance. Answer: True Learning Objective: 04-01 Topic: How to Determine Important Buying Needs—A Key to Success Blooms: Understand AACSB: Analytic Level of Difficulty: Remember Explanation: Your initial task when first meeting the customer is to differentiate between important buying needs and needs of lesser or no importance. Buyers have both important needs and needs that are not major reasons for buying a product (relatively unimportant buying needs). Determine buyers’ important needs and concentrate on emphasizing product benefits that will satisfy those needs.. 12. The acronym L-O-C-A-T-E is useful for remembering how to handle a prospect's objections. Answer: False Learning Objective: 04-05 Topic: How to Determine Important Buying Needs—A Key to Success Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The LOCATE acronym is used to uncover a buyer’s needs. During the trial close, a salesperson addresses a prospect’s objections to a purchase. 13. The main purpose of the trial close is to induce feedback from the buyer. Answer: True Learning Objective: 04-03 Topic: The Trial Close—A Great Way to Uncover Needs and SELL Blooms: RememberChapter 04 - The Psychology of Selling: Why People Buy 4-5 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Easy Explanation: The trial close is when the salesperson checks the attitude of a prospect towards the sales presentation. It gives the salesperson a chance to overcome objections. 14. According to the SELL sequence, the first thing you should do in your sales presentation is to explain the advantages of your product. Answer: False Learning Objective: 04-0 Topic: SELL Sequence Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Showing advantages occurs after describing the features of the product. Benefits are then discussed by the salesperson. 15. The SELL sequence is a useful tool for remembering to incorporate a trial close during a sales presentation. Answer: True Learning Objective: 04-02 Topic: SELL Sequence Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: One way to remember to incorporate a trial close into your presentation is the SELL Sequence. Each letter of the word ―sell‖ stands for a sequence of things to do and say to stress benefits important to the customer. 16. In the SELL Sequence, the final step involves asking for feedback from the prospect and conducting a trial close. Answer: True Learning Objective: 04-02 Topic: SELL Sequence Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The last step of the SELL Sequence involves letting the customer talk. Salespeople ask the prospect questions and gather feedback, which is the same as conducting a trial close. 17. In a limited decision making situation, buyers are already in the habit of buying a specific product or brand. Answer: False Learning Objective: 04-06 Topic: You Can Classify Buying SituationsChapter 04 - The Psychology of Selling: Why People Buy 4-6 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Routine decision making involves the purchase of products based on habit. Limited decision making means that the buyer knows the general qualities of certain goods but is unfamiliar with a brand’s features or benefits. 18. The "S" in the SELL Sequence reminds the salesperson to show the benefits first. Answer: False Learning Objective: 04-02 Topic: SELL Sequence Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The ―S‖ in SELL is a reminder to show the features of the product. The salesperson then explains the advantages before leading into the benefits of the product 19. The easiest type of person to sell a product to is a buyer who is at the unconscious need level. Answer: False Learning Objective: 04-06 Topic: Psychological Influences on Buying Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Buyers at the conscious need level are the easiest ones to sell to because they know what products they want and understand their own needs. Prospects at the unconscious need level have to be drawn out by a salesperson because such people do not know what or why to make a purchase. 20. Security, comfort, self-preservation, and personal pleasure are common psychological needs of buyers. Answer: True Learning Objective: 04-05 Topic: How to Determine Important Buying Needs—A Key to Success Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: People make purchases to solve rational and emotional needs. Psychological needs, such as comfort, vanity, and pleasure, are common reasons for buying products. 21. According to the LOCATE acronym, it is helpful for a salesperson to ask co-workers or subordinates about a prospect’s needs. Answer: True Learning Objective: 04-05Chapter 04 - The Psychology of Selling: Why People Buy 4-7 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Topic: How to Determine Important Buying Needs—A Key to Success Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Salespeople need to talk to both the prospect and those who work with the prospect to determine buying needs. Asking an office manager’s assistant about the needs of the manager can provide useful information. 22. Claudia recently purchased a Toyota Camry and is concerned that she may have overpaid for the car. Claudia is experiencing emotional dissonance. Answer: False Learning Objective: 04-06 Topic: View Buyers as Decision Makers Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Claudia is experiencing purchase dissonance after the car’s purchase. Dissonance causes tension over whether the right decision was made in buying the product. Some people refer to this as buyer’s remorse. 23. A beneficial promotional device for a company is having its sales force help prospects and customers to evaluate products on the market. Answer: True Learning Objective: 04-06 Topic: View Buyers as Decision Makers Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A company has no better promotional device than having its sales force help prospects and customers to evaluate products on the market—and not merely their own products. The two-way communication between buyer and seller is exceptionally effective in providing the information needed to make the sale on the one hand, and to evaluate the product on the other. 24. Dissonance increases with the importance of the decision and the difficulty of choosing between products. Answer: True Learning Objective: 04-06 Topic: View Buyers as Decision Makers Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 04 - The Psychology of Selling: Why People Buy 4-8 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: The buyer can experience purchase dissonance after the product’s purchase. Dissonance causes tension over whether the right decision was made in buying the Product and increases with the importance of the decision and the difficulty of choosing between products 25. A salesperson can help buyers be satisfied with a product by continually reinforcing buyers' decisions and reminding buyers how well the product actually fulfills their needs. Answer: True Learning Objective: 03-06 Topic: View Buyers as Decision Makers Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Salespeople can help buyers overcome buyer’s remorse by showing them how to use the product and remind them how the product fulfills their needs. 26. Before developing a sales presentation, a salesperson should consider what psychological factors may influence the buyer's decision. Answer: True Learning Objective: 04-07 Topic: To Buy or Not to Buy—A Choice Decision Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Understanding the perceptions, attitudes, and beliefs of a prospect is helpful before developing a sales presentation. Salespeople who understand the mental factors that influence the buyer’s decision are more likely to make the sale. 27. The stimulus-response model of buyer behavior assumes a prospect will respond in some unpredictable manner to a sales presentation. Answer: False Learning Objective: 04-06 Topic: Why People Buy—The Black Box Approach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The stimulus-response model assumes that prospects respond in a predictable way to a sales presentation. However, the buyer’s decision-making process is unknown and internalized. 28. Buying situations play a role in a customer's decision-making process. Answer: True Learning Objective: 04-06 Topic: You Can Classify Buying Situations Blooms: RememberChapter 04 - The Psychology of Selling: Why People Buy 4-9 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Easy Explanation: The quickness and ease of deciding the product to buy typically depends on the buying situation. Purchasing a gallon of milk is an easier decision than purchasing an automobile. 29. A high-involvement type of purchase typically requires routine decision making. Answer: False Learning Objective: 04-06 Topic: You Can Classify Buying Situations Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Routine decision making occurs when buying low-involvement goods such as milk and soda. High-involvement occurs when purchasing cars and real estate. 30. The consumer buying decision process begins with buyers recognizing a need and ends with buyers collecting product information. Answer: False Learning Objective: 04-06 Topic: View Buyers as Decision Makers Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The first stage of the consumer buying decision process involves recognizing a need and then gathering product information. After a product has been purchased, the consumer experiences post-purchase behavior in the form of satisfaction or dissatisfaction. 31. At the unconscious need level, people do not know why they buy a product—only that they do buy. Answer: True Learning Objective: 04-06 Topic: Psychological Influences on Buying Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: At the unconscious need level, people do not know why they buy a product— only that they do buy. A person’s buying motives might have developed years earlier and may have been repressed. 32. A sales presentation that focuses primarily on product features is highly persuasive. Answer: False Learning Objective: 04-01 Topic: A FABulous Approach to Buyer Need Satisfaction Blooms: UnderstandChapter 04 - The Psychology of Selling: Why People Buy 4-10 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Medium Explanation: Product features alone are not very persuasive to consumers. A presentation should also discuss the advantages and benefits of a product. 33. The sale is made once the prospect states an intention to buy the product/service. Answer: False Learning Objective: 04-06 Topic: View Buyers as Decision Makers Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A sale is not made until a contract is signed or the buyer has given money to the seller. A prospect’s purchasing intentions may change as a result of the attitudes of others or uncontrollable circumstances. 34. The consumer buying decision process ends for the buyer once a product is purchased. Answer: False Learning Objective: 04-06 Topic: View Buyers as Decision Makers Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: For the buyer, the decision process continues after the purchase is made because they will feel either satisfied or dissatisfied. Salespeople should continue reinforcing the idea that the purchase was a good idea to reduce buyer’s remorse. 35. It is easier to sell to a stranger than to an existing customer, because former customers are high maintenance. Answer: False Learning Objective: 04-07 Topic: Satisfied Customers Are Easier to Sell To Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: It is easier to sell to a customer than to a stranger—especially a satisfied customer! That’s why building a relationship—keeping in touch after the sale—is so important to a salesperson’s success.Chapter 04 - The Psychology of Selling: Why People Buy 4-11 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Multiple Choice Questions 36. The black box is most closely associated with: A. the stimulus-response model. B. empathetic dispersion. C. product adoption. D. the SELL sequence. E. benefit selling. Answer: A Learning Objective: 04-06 Topic: Why People Buy—The Black Box Approach Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The black box is associated with the classic model of buyer behavior known as the stimulus–response model. 37. The process by which prospective buyers "internalize" or consider the information presented by the salesperson is referred to as a black box because: A. sales actions lead to buyer reactions. B. salespeople cannot read a buyer's mind. C. psychological needs outweigh social wants. D. for every stimulus, there must be a response. E. salespeople seem untrustworthy to most buyers. Answer: B Learning Objective: 04-06 Topic: Why People Buy—The Black Box Approach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A prospective buyer internalizes or considers sales presentation information and then makes a buying decision. This process of internalization is referred to as a black box because we cannot see into the buyer’s mind—meaning that the salesperson can apply the stimuli (a sales presentation) and observe the behavior of the prospect but cannot witness the prospect’s actual decision-making process. 38. People's _____ result from a lack of something desirable like food or drink. A. beliefs B. perceptions C. wants D. attitudes E. needs Answer: E Learning Objective: 04-06 Topic: Psychological Influences on BuyingChapter 04 - The Psychology of Selling: Why People Buy 4-12 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: People’s needs result from a lack of something desirable. Wants are needs learned by the person. 39. Brenda is hungry. She has learned to meet that need by seeking out the CiCi Pizza all-youcan-eat buffet. By preferring this type of eating opportunity, Brenda is satisfying a(n): A. belief. B. perception. C. want. D. attitude. E. opportunity Answer: C Learning Objective: 04-06 Topic: Psychological Influences on Buying Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: People’s needs result from a lack of something desirable. Wants are needs learned by the person. Brenda needs food but wants pizza instead of burgers. 40. The levels of need awareness in order from first to last are: A. conscious, self-conscious, and unconscious. B. conscious, preconscious, and subconscious. C. conscious, unconscious, and subconscious. D. conscious, preconscious, and unconscious. E. conscious, preconscious, and self-conscious. Answer: D Learning Objective: 04-06 Topic: Psychological Influences on Buying Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Three levels of need awareness have been identified—conscious, preconscious, and unconscious. Conscious is the first level followed by preconscious and unconscious. 41. Theo is in Target looking for a gift for his girlfriend. Theo is not sure of what he wants except in general terms. At what level of need awareness is Theo in? A. Conscious B. Preconscious C. Semiconscious D. Unconscious E. Intermediate Answer: BChapter 04 - The Psychology of Selling: Why People Buy 4-13 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Learning Objective: 04-06 Topic: Psychological Influences on Buying Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: At the preconscious need level, buyers may not be fully aware of their needs. They know what general type of product they want but may not wish to discuss it fully with a salesperson. 42. The easiest people to sell to are people at the _____ level of need awareness. A. conscious B. preconscious C. unconscious D. subconscious E. intermediate Answer: A Learning Objective: 04-06 Topic: Psychological Influences on Buying Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: At the conscious need level, buyers are fully aware of their needs. These are the easiest people to sell to because they know what products they want and are willing to talk about their needs. 43. When using the _____, a salesperson relates a product's benefits to the customers' needs using the product's features and advantages to support the claims made. A. trial close B. detail approach C. SELL analysis D. SWOT method E. FAB selling technique Answer: E Learning Objective: 04-01 Topic: A FABulous Approach to Buyer Need Satisfaction Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: In benefit selling, the salesperson relates a product’s benefits to the customer’s needs using the product’s features and advantages as support. This technique is often referred to as the FAB selling technique (Feature, Advantage, and Benefit).Chapter 04 - The Psychology of Selling: Why People Buy 4-14 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 44. A product advantage is defined as: A. any physical characteristic of a product. B. the performance characteristic of a product. C. a favorable result the buyer receives from use of the product. D. the characteristic that no product in the same category can provide. E. a particular advantage that has the ability to satisfy the buyer's need. Answer: B Learning Objective: 04-01 Topic: A FABulous Approach to Buyer Need Satisfaction Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A product advantage is the performance characteristic of a product that describes how it can be used or will help the buyer. A product feature is any physical characteristic of a product. A product benefit is a favorable result the buyer receives from the product. 45. Which of the following statements describes a product feature? A. "These table lamps are offered in either a silver or black finish." B. "Customers will be drawn into your store if you stock these utensils." C. "Consumers prefer our line of toothbrushes 2:l over competing brands." D. "This automatic pool cleaner will save you at least three hours a week." E. "This machine will copy on both sides of the pages instead of only one." Answer: A Learning Objective: 04-01 Topic: A FABulous Approach to Buyer Need Satisfaction Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A product feature is any physical characteristic of a product, such as color, size, and price. 46. When the salesperson discusses a product's _________, the salesperson is answering the question, "What is it?" A. features B. benefits C. advantages D. primary achievements E. performance characteristics Answer: A Learning Objective: 04-01 Topic: A FABulous Approach to Buyer Need Satisfaction Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 04 - The Psychology of Selling: Why People Buy 4-15 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: A product feature is any physical characteristic of a product. Descriptions of a product’s features answer the question, ―What is it?‖ 47. "Our product is the only one on the market that will remove 99 percent of all bacteria from the air" is an example of a(n): A. product feature. B. economic need. C. product advantage. D. achievement. E. product benefit. Answer: C Learning Objective: 04-01 Topic: A FABulous Approach to Buyer Need Satisfaction Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A product advantage is the performance characteristic of a product that describes how it can be used or will help the buyer. Removing bacteria is a performance characteristic that will help the buyer have a clean home. 48. Which of the following is most likely a want rather than a need? A. shelter B. water C. clothing D. spaghetti E. transportation Answer: D Learning Objective: 04-06 Topic: Psychological Influences on Buying Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: People’s needs result from a lack of something desirable. Wants are needs learned by the person. Food would be a need, but a specific type of food, such as spaghetti, is a want.Chapter 04 - The Psychology of Selling: Why People Buy 4-16 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 49. In what order are the feature, advantage, and benefit presented in the following statement? "This fishing trawler has a 10 percent greater capacity than boats of a similar size. It will save you at least $100 per fishing trip because it can carry more fish than other boats on the market." A. Advantage, feature, and benefit B. Feature, advantage, and benefit C. Advantage, benefit, and feature D. Feature, benefit, and advantage E. Benefit, advantage, and feature Answer: D Learning Objective: 04-01 Topic: A FABulous Approach to Buyer Need Satisfaction Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: The capacity of the boat is a feature or physical characteristic, and the savings it will bring a buyer are the benefit. The advantage of the boat is the fact that it can carry more fish than other boats. 50. In what order are the feature, advantage, and benefit presented in the following statement? "This television's solid-state design produces a more vivid picture, which will make your television viewing more enjoyable." A. Feature, benefit, and advantage B. Advantage, feature, and benefit C. Feature, advantage, and benefit D. Advantage, benefit, and feature E. Benefit, advantage, and feature Answer: C Learning Objective: 04-01 Topic: A FABulous Approach to Buyer Need Satisfaction Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: Solid-state design is the television’s feature, which provides customers with the advantage of a vivid picture. Consumers will benefit from having an enjoyable television viewing experience. 51. The acronym L-O-C-A-T-E is used to: A. remember the sequence of steps in benefit selling. B. list the steps needed to use stimulus-response selling. C. remember techniques for uncovering important buying needs. D. remind the seller to identify product features, advantages, and benefits. E. remember the six types of trial closes. Answer: CChapter 04 - The Psychology of Selling: Why People Buy 4-17 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Learning Objective: 04-05 Topic: How to Determine Important Buying Needs—A Key to Success Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The L-O-C-A-T-E method is used to determine the buying needs that are most important to a customer. Observing prospects and asking them questions are two methods for determining needs. 52. The _____ checks the pulse or attitude of your prospect toward the sales presentation. A. FAB demonstration B. response to the stimulus C. trial close D. post-approach E. black box Answer: C Learning Objective: 04-03 Topic: The Trial Close—A Great Way to Uncover Needs and SELL Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The trial close is one of the best-selling techniques to use in your sales presentation. It checks the pulse or attitude of your prospect toward the sales presentation. 53. The trial close allows the salesperson to determine whether: A. the prospect likes the features, advantages, or benefits of the product. B. the salesperson will meet the organization’s monthly sales quota. C. the salesperson should use one-way or two-way communication. D. the prospect has the purchasing power to buy the product. E. the prospect is in the conscious state of mind. Answer: A Learning Objective: 04-03 Topic: The Trial Close—A Great Way to Uncover Needs and SELL Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The trial close allows a salesperson to determine whether the prospect likes a product’s feature, advantage, or benefit. Prior to the presentation, the salesperson should have determined if the prospect has the purchasing power to buy the product.Chapter 04 - The Psychology of Selling: Why People Buy 4-18 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 54. During a sales presentation, it can be most effective when asking for an order to: A. discuss financing challenges. B. mention the prospect’s positive comments. C. outline the expected delivery schedule. D. prevent the prospect form asking questions. E. re-address the prospect’s negative comments. Answer: B Learning Objective: 04-03 Topic: The Trial Close—A Great Way to Uncover Needs and SELL Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Remember the prospect’s positive reactions and use them later to help overcome objections and in closing the sale. Generally, it is best to not discuss the negative again. 55. The _____ involves the showing of a product feature, explaining the advantage, leading into a benefit, and then letting the customer talk by asking a question about the benefit. A. multi-selling process B. AIDA model C. stimulus-response model D. SELL sequence E. perceptual mapping process Answer: D Learning Objective: 04-02 Topic: SELL Sequence Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: By using the SELL sequence, a salesperson can remember to show the feature, explain the advantage, lead into the benefit, and then let the customer talk by asking a question about the benefit (trial close). 56. Which of the following statements about economic needs is true? A. Economic needs are unimportant to most consumers. B. Economic needs are rarely considered during times of economic recession. C. Economic needs refer to the buyer's need to behave in an economically rational manner and buy the lowest priced item available. D. Economic needs refer to the buyer's need to purchase the most satisfying product for the money. E. A product priced higher than the competition's is doomed to failure because it satisfies no economic need. Answer: D Learning Objective: 04-06 Topic: Psychological Influences on Buying Blooms: UnderstandChapter 04 - The Psychology of Selling: Why People Buy 4-19 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Medium Explanation: Economic needs are the buyer’s need to purchase the most satisfying product for the money. Economic needs include price, quality (performance, dependability, durability), convenience of buying, and service. Most people consider the economic implications of all their purchases along with other reasons for buying. 57. The underlying component of a successful sales presentation is: A. differentiating between wants and needs. B. utilizing statistical information as support. C. identifying important product advantages. D. explaining product features clearly. E. determining the customer’s needs. Answer: E Learning Objective: 04-05 Topic: How to Determine Important Buying Needs—A Key to Success Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Selling is primarily about determining needs and skillfully relating your product’s benefits to show how its purchase will fulfill customers’ needs. 58. Which of the following would be the LEAST effective trial close question? A. How does that sound to you? B. Is this important to you? C. Does that answer your concern? D. What do you think? E. Are you ready to order? Answer: E Learning Objective: 04-03 Topic: The Trial Close—A Great Way to Uncover Needs and SELL Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The purpose of the trial close is to determine the prospect’s attitude and answer any objections. It is not the time to request an order. 59. Technology helps salespeople to: A. rely on fewer environmental signals. B. identify customer personality styles. C. implement frequent trial closes. D. view customers as decision makers. E. serve customers faster and better. Answer: E Learning Objective: 04-06Chapter 04 - The Psychology of Selling: Why People Buy 4-20 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Topic: Technology Provides Information Blooms: Remember AACSB: Technology Level of Difficulty: Easy Explanation: Smartphones, laptops, and tablets enable salespeople to respond to customers more quickly than in the past. Technology enables salespeople to monitor inventory and cost. 60. LeAnn, a salesperson for a Honda dealer, has spent the last 20 minutes with a customer who came to the showroom. LeAnn listened carefully to the customer and asked questions about the customer’s needs and interests. LeAnn has determined that the customer most likely needs a Honda Civic. What should LeAnn do next? A. Show the customer both a Honda Civic and a Honda Accord B. Discuss the number of Honda Civics on the road C. Share the history of Honda Civics D. Discuss the benefits of the Honda Civic E. Determine monthly costs for buying a Honda Civic Answer: D Learning Objective: 04-05 Topic: How to Determine Important Buying Needs—A Key to Success Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: Once you determine the major buying need, you are ready to relate the person’s needs to a product’s benefits, such as the features and benefits of Civics. Basically, this is what selling is all about—determining needs and skillfully relating your product’s benefits to show how its purchase will fulfill customers’ needs. 61. Erin has just walked into a local appliance store and told the salesperson, "I'd like to buy a side-by-side, stainless steel Whirlpool refrigerator. It needs to be at least 24 cubic feet and should have an exterior ice and water dispenser. What can you show me?" At what level of need awareness is Erin? A. Conscious B. Preconscious C. Postconscious D. Unconscious E. Subconscious Answer: A Learning Objective: 04-06 Topic: Psychological Influences on Buying Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: At the conscious need level, buyers are fully aware of their needs. These are the easiest people to sell to because they know what products they want and are willing to talk about their needs.Chapter 04 - The Psychology of Selling: Why People Buy 4-21 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 62. The statement, "With its 25 percent market share, this is the best-selling laser printer on the market today," is an example of a(n): A. product advantage. B. segmentation variable. C. product feature. D. market property. E. product benefit. Answer: A Learning Objective: 04-01 Topic: A FABulous Approach to Buyer Need Satisfaction Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Product advantages are performance characteristics, which in this case is that the printer is a top-seller. Product features are physical characteristics, like fast printing. 63. The statement "The new Maytag washer saves you time, work, and money," is an example of a(n): A. feature. B. segmentation variable. C. advantage. D. benefit. E. market trait. Answer: D Learning Objective: 04-01 Topic: A FABulous Approach to Buyer Need Satisfaction Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Product benefits are how a product helps the buyer, such as having more free time. Product advantages are performance characteristics, such as the ability to adjust the amount of water based on the load size. 64. It is important to emphasize benefits in a sales presentation to a prospective buyer because benefits: A. focus on the psychological reasons of a purchase. B. fulfill the buyer's needs and motives. C. fulfill the buyer’s economic wants. D. focus on rational reasons of a purchase. E. focus on emotional reasons for a purchase. Answer: B Learning Objective: 04-04 Topic: A FABulous Approach to Buyer Need Satisfaction Blooms: Understand AACSB: AnalyticChapter 04 - The Psychology of Selling: Why People Buy 4-22 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: People make purchases because of a product’s benefits more than about its features or advantages. Emphasizing benefits appeals to the customer’s personal motives. 65. The acronym L-O-C-A-T-E reminds us of several useful methods for uncovering a prospective buyer's needs. If prospects drop leading remarks like "I wish I had a television like this one," it pertains to: A. observing. B. listening. C. asking. D. learning. E. optimizing. Answer: B Learning Objective: 04-05 Topic: How to Determine Important Buying Needs—A Key to Success Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Prospects may drop leading remarks about their wants or needs, and it is important for a salesperson to listen and remember such comments. 66. All of the following are the appropriate times for a salesperson to use a trial close EXCEPT: A. after making a strong selling point in the presentation. B. immediately before moving to close the sale. C. immediately after closing the sale. D. after answering an objection. E. after the presentation. Answer: C Learning Objective: 04-03 Topic: The Trial Close—A Great Way to Uncover Needs and SELL Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A trial close is appropriate after making a strong point, after the presentation, after answering an objection, and before closing a sale. After the sale has been completed, there would be no point to a trial close.Chapter 04 - The Psychology of Selling: Why People Buy 4-23 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 67. Christine has just answered a prospect's question about some negative publicity her product received. To find out if her prospect has any more objections with which she should deal, Christine should: A. hand her catalog to the prospect. B. use the questions approach. C. begin her demonstration. D. implement a trial close. E. lead into a benefit. Answer: D Learning Objective: 04-03 Topic: The Trial Close—A Great Way to Uncover Needs and SELL Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: After a salesperson responds to a prospect’s objection, it is a good time to use a trial close. The trial close would help determine the prospect’s current opinion about the product. 68. According to the two Ls in the SELL Sequence, a salesperson should: A. lead into the benefits, and let the customer talk. B. limit the length of a sales presentation, and let visual aids do the talking. C. learn the prospect's personality type, and let the personality type guide the closing. D. limit the number of benefits discussed, and list features at the end of the presentation. E. locate the prospect's needs, and leave closing until the end of the sales presentation. Answer: A Learning Objective: 04-02 Topic: SELL Sequence Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Each letter of the word sell stands for a sequence of things to do and say to stress benefits important to the customer. By remembering the word sell, you remember to show the feature, explain the advantage, lead into the benefit, and then let the customer talk by asking a question about the benefit. 69. Which of the following is a false assumption made by many salespeople? A. Benefits are very important to buyers. B. Price is the only factor in a buying decision. C. Psychological factors influence buying decisions. D. Wants and needs motivate buying decisions. E. Unimportant benefits should be deemphasized. Answer: B Learning Objective: 04-06 Topic: Psychological Influences on Buying Blooms: UnderstandChapter 04 - The Psychology of Selling: Why People Buy 4-24 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Medium Explanation: Many salespeople mistakenly assume that people base their buying decision solely on price. This is not always correct. A higher product price relative to competing goods often can be offset by such factors as service, quality, better performance, friendliness of the salesperson, and convenience of purchase. 70. What is most needed when working with a prospect at the unconscious need level? A. Perceptive observations of the customer’s social class B. Skillful questioning to determine the customer’ needs C. Self-awareness modification to gain customer trust D. Highly detailed feature descriptions E. Multiple attempts at a trial closing Answer: B Learning Objective: 04-06 Topic: Psychological Influences on Buying Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: At the unconscious need level, a prospect doesn’t know what they want to buy, so the salesperson needs to determine the needs that are influential. Often, this is accomplished by skillful questioning to draw out prospective buyers’ unconscious needs. 71. What is the meaning of Elmer Wheeler’s statement, ―Sell the sizzle, not the steak‖? A. People buy for unknown emotional reasons. B. Most purchases are made habitually. C. People buy for economic benefit. D. Direct marketing is ineffective. E. Features outweigh advantages. Answer: A Learning Objective: 04-05 Topic: How to Determine Important Buying Needs—A Key to Success Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Wheeler is saying that people buy for reasons other than what the product will actually do or its price. They have both practical (rational) and psychological (emotional) reasons for buying.Chapter 04 - The Psychology of Selling: Why People Buy 4-25 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 72. If a customer makes routine purchase decisions when buying products from a salesperson, then it is especially important for the salesperson to: A. offer product financing. B. use product promotions. C. attempt a pre-trial close. D. keep the product in stock. E. provide competitive data. Answer: D Learning Objective: 04-06 Topic: You Can Classify Buying Situations Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: For a customer making a routine purchase decision, reinforce that this is the correct buying decision. It is important to have the product in stock. If you do not have it, the customer may go to another supplier. 73. Routine decision making is most likely involved when an individual purchases a _____. A. Gibson guitar B. Honda sedan C. Canon printer D. People magazine E. Golden Retriever puppy Answer: D Learning Objective: 04-06 Topic: You Can Classify Buying Situations Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Routine decision making occurs when people buy low-cost and low-involvement products, such as magazines. Higher involvement purchases, such as guitars, cars, printers, and puppies are likely to require more thought and consideration. 74. The city manager has to buy a replacement traffic signal with the same specifications as the other signals currently in use in the city. The manufacturer from which he purchased the last 12 signals has gone out of business and a new supplier has to be selected from a group of three possible companies. To make this purchase, the city manager will have to use _____ decision making. A. routine B. intensive C. limited D. extensive E. selective Answer: C Learning Objective: 04-06Chapter 04 - The Psychology of Selling: Why People Buy 4-26 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Topic: You Can Classify Buying Situations Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: When buyers are unfamiliar with a particular product brand, they seek more information when making a purchase decision. In this case, the city manager will need gather information about different brands of traffic lights. 75. Which of the following purchases would most likely involve extensive decision making? A. Scheduling an annual dentist appointment B. Buying a new towel rack for your bath C. Purchasing a birthday gift for a friend D. Renewing a magazine subscription E. Purchasing a condominium Answer: E Learning Objective: 04-06 Topic: You Can Classify Buying Situations Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Real estate decisions are costly, so they require extensive decision making. Making a doctor’s appointment or purchasing smaller priced items most likely involve routine or limited decision making. 76. According to the text, the steps of the buying decision process, in their correct order, are: A. need arousal, collection of information, alternative selection, purchase decision, and postpurchase evaluation. B. need arousal, alternative determination, information gathering, purchase decision, and purchase evaluation. C. need arousal, collection of information, information evaluation, purchase decision, and postpurchase behavior. D. need arousal, information collection, purchase, purchase evaluation, and repurchase. E. need arousal, purchase, purchase evaluation, postpurchase behavior, and repurchase. Answer: C Learning Objective: 04-06 Topic: View Buyers as Decision Makers Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Typically, the buying decision involves five basic steps. Buyers recognize a need, collect information provided by the salesperson, evaluate that information, decide to buy, and after the purchase determine whether they are satisfied. This sequence reveals that several events occur before and after the purchase, all of which the salesperson should consider.Chapter 04 - The Psychology of Selling: Why People Buy 4-27 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 77. During the _____ stage of the buying process, the individual often experiences the need for safety, self-actualization, or ego fulfillment. A. need arousal B. collection of information C. information evaluation D. purchase evaluation E. alternative selection Answer: A Learning Objective: 04-05 Topic: View Buyers as Decision Makers Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A buyer’s need may be triggered by the salesperson; this is called need arousal. Needs may be psychological, social, or economic and may include a need for safety, selfactualization, or ego fulfillment. 78. Which of the following is an example of a personal factor that influences consumer buying behaviors? A. Culture B. Friends C. Perception D. Gender E. Social class Answer: D Learning Objective: 04-06 Topic: View Buyers as Decision Makers Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Gender, age, and income are personal influences on buying behaviors. Culture, friends, and social class are social influences, and perception is a psychological influence. 79. Which of the following is an example of a social factor that could influence consumers' buying behaviors? A. Situation B. Past experiences C. Perception D. Income E. Family Answer: E Learning Objective: 04-06 Topic: View Buyers as Decision Makers Blooms: Remember AACSB: AnalyticChapter 04 - The Psychology of Selling: Why People Buy 4-28 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: Family is a social factor that influences consumer buying, while situation and income are personal influences. Past experiences and perceptions are psychological influences. 80. During the _____ phase of the buying decision process, the buyer rates her preferences among products she is considering. A. need arousal B. information collection C. information evaluation D. purchase evaluation E. alternative selection Answer: C Learning Objective: 04-06 Topic: View Buyers as Decision Makers Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: At the information evaluation stage, a person rates product preferences on factors like price, quality, and brand. After the evaluation, a purchase decision can be made. 81. Eli is excited because a prospect has just signed a purchasing agreement for the biggest sale Eli has made in his two-year sales career. Eli is obviously happy as he sits across the desk from his newest customer. What should Elli do now? A. Discuss the buyer's expectations concerning a delivery schedule of the product B. Stop talking about the product ordered and leave the customer's office C. Discuss the buyer's expectations for the product D. Discuss his company's payment expectations E. Invite the prospect out for a meal Answer: B Learning Objective: 04-06 Topic: View Buyers as Decision Makers Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: Many sales have been lost after a buyer has said, ―I will buy,‖ and the salesperson continues to talk. Additional information sometimes causes buyers to change their minds. It is important to finalize the sale as quickly as possible after the buyer makes a decision and then leave.Chapter 04 - The Psychology of Selling: Why People Buy 4-29 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 82. The owner of a catering company recently bought a new heavy-duty electric mixer. She had high expectations for the new mixer and paid "top dollar" to get the accessories on her mixer that she considered important. After owning the machine for two weeks, the caterer feels she has received even more benefits from the purchase of this mixer than she expected. Because of this result, the product can be said to have caused: A. prepurchase behavior. B. purchase satisfaction. C. service dissatisfaction. D. purchase dissonance. E. prepurchase evaluation. Answer: B Learning Objective: 04-06 Topic: View Buyers as Decision Makers Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Purchase satisfaction comes from receiving benefits expected, or greater than expected, from a product. If buyers’ experiences from the use of a product exceed expectations, they are satisfied, but if experiences are below expectations, customers are dissatisfied. 83. _____ is defined as the tension a buyer feels over whether he/she made the right decision in buying a product. A. Postpurchase evaluation B. Purchase satisfaction C. Purchase dissonance D. Purchase dissatisfaction E. Purchase evaluation Answer: C Learning Objective: 04-06 Topic: View Buyers as Decision Makers Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The buyer can experience purchase dissonance after the product’s purchase. Dissonance causes tension over whether the right decision was made in buying the product. Some people refer to this as buyer’s remorse.Chapter 04 - The Psychology of Selling: Why People Buy 4-30 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 84. Showing the buyer how to properly use the product and making realistic claims about the product are two ways to: A. reduce the buyer’s product satisfaction. B. lower the buyer's dissonance level. C. increase the buyer’s dissatisfaction. D. reduce routine decision making. E. discourage whistle-blowing. Answer: B Learning Objective: 04-06 Topic: View Buyers as Decision Makers Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Salespeople can reduce purchase dissonance by showing buyers how to use a product and making realistic rather than exaggerated claims about the product. Purchase dissonance causes tension over whether the right decision was made in buying the product. 85. Since salespeople help their prospects make the choice to buy or not buy a product, it is important for salespeople to understand: A. the various factors that can influence a buyer's decision. B. how to encourage customers to experience purchase dissonance. C. the material taught in advanced business psychology classes. D. all that is involved in the psychological processes a buyer goes through in making a decision. E. that selling to strangers is far easier than selling to known customers. Answer: A Learning Objective: 04-07 Topic: To Buy or Not to Buy—A Choice Decision Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Salespeople need to understand the different factors influencing the buying decision, but they do not have to be psychologists to do so. The average salesperson cannot know all that is involved in the psychological and practical processes that a buyer goes through in making a decision but salespeople can uncover the buyer’s specific needs.Chapter 04 - The Psychology of Selling: Why People Buy 4-31 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Stage Technologies Stage Technologies is a London-based company that supplies engineering solutions for the entertainment industry. It has helped the boy-band Westlife make a flying entrance onto stage and provided stage-rigging packages for the Princess cruise line. The company was established in 1994 after a couple of production designers decided that the automation of theater productions could be done more safely and more efficiently by using modular production rather than the old "build-as-needed" formula. The company installs wenches, stage lifts, and other equipment commonly used in stage productions. The equipment is designed so it can be operated from a single console without heavy lifting. Both opera companies and theaters see the benefit of such a system, but many are reluctant to buy because of perceived costs. Joseph Harris is the company's best salesperson. Harris is making a sales call on the manager of a theater that is planning to perform three plays this season that include complicated lifting, flying, and a working trapdoor. The manager is aware of the time, labor, and monetary costs involved in staging these productions and wishes there was an easier way to produce the three plays. 86. The theater manager is most likely at the: A. unconscious level and will be a difficult sell. B. preconscious level and will require a lengthy sales presentation. C. routine decision level and anxious about the purchase. D. conscious level and easy to sell to. E. routine decision level with few objections. Answer: D Learning Objective: 04-06 Topic: Psychological Influences on Buying Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The manager is fully aware of his needs and the products he wants. He should be easy to sell to if the salesperson can overcome cost and time concerns. 87. Harris should most likely use the acronym L-O-C-A-T-E to: A. explain the physical characteristics of the product. B. determine the manager’s personality type. C. uncover the important needs of the manager. D. create a bond between himself and the manager. E. deal with the manager’s price objections. Answer: C Learning Objective: 04-05 Topic: How to Determine Important Buying Needs—A Key to Success Blooms: Understand AACSB: AnalyticChapter 04 - The Psychology of Selling: Why People Buy 4-32 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: The L-O-C-A-T-E acronym serves as a reminder to uncover the most important buying needs of the customer. Harris should listen, observe, and ask questions to identify needs. 88. During the sales presentation, which of the following should most likely be emphasized to the theater manager? A. Benefits of the Stage Technologies system B. Safety features of the Stage Technologies wench C. Stage Technologies’ service record D. Uses for the Stage Technologies equipment E. Leasing arrangements of Stage Technologies Answer: A Learning Objective: 04-01 Topic: A FABulous Approach to Buyer Need Satisfaction Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: The salesperson will be more successful by stressing the benefits of the system more than the features and advantages. The manager is more interested in what the system will do for him and the theater. 89. During the sales presentation to the theater manager, Harris makes a strong selling point about the benefits of the Stage Technologies system. At that point, Harris should most likely: A. request a short break. B. re-address a negative objection. C. immediately move to close the sale. D. ask the manager his opinion about the system. E. continue moving forward with the presentation. Answer: D Learning Objective: 04-03 Topic: The Trial Close—A Great Way to Uncover Needs and SELL Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: A trial close is important to use after making a strong selling point. Harris would learn if the point had a positive effect on the manager and whether it was appropriate to start moving towards a close.Chapter 04 - The Psychology of Selling: Why People Buy 4-33 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 90. Buyer's remorse would most likely occur if: A. Harris used the SELL sequence for prospecting prior to the sales presentation. B. the customer tried to save money by buying fewer modules than needed. C. Harris used uniform delivery pricing. D. the customer had perceptual objections. E. Harris used too many trial closes. Answer: B Learning Objective: 04-06 Topic: View Buyers as Decision Makers Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Customers who purchase what they need are less likely to experience buyer’s remorse. Salespeople should ensure that the customer’s needs are met to avoid post-purchase dissonance. Essay Questions 91. Describe the three stages in the stimulus-response model of buyer behavior. Answer: The classic model of buyer behavior is called a stimulus- response model. The first stage is the stimulus, which is the sales presentation. Next is the black box, which indicates the buyer's hidden mental processes. The final stage is the response, which is either a sale or no sale. A stimulus (sales presentation) is applied, resulting in a response (purchase decision). This model assumes that prospects respond in some predictable manner to the sales presentation. Learning Objective: 04-06 Topic: Why People Buy—The Black Box Approach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 92. What are the three levels of need awareness? Define them. Answer: The three levels of need awareness are:  Conscious need level: Buyers are fully aware of their needs. These are the easiest people to sell to because they know what products they want and are willing to talk about their needs.  Preconscious need level: Buyers may not be fully aware of their needs. Needs may not be fully developed in the conscious mind. They know what general type of product they want but may not wish to discuss it fully.  Unconscious need level: People do not know why they buy a product—only that they do buy. When people say, "I really don't know what I want to buy," it may be true. Their buying motives might have developed years earlier and may have been repressed. Learning Objective: 04-06 Topic: Psychological Influences on Buying Blooms: UnderstandChapter 04 - The Psychology of Selling: Why People Buy 4-34 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Medium 93. Several methods are used to uncover the prospect's needs. These methods create the acronym L-O-C-A-T-E. Explain this acronym and how salespeople use it. Answer: Several methods are frequently used to uncover important needs. These methods create the acronym L-O-C-A-T-E:  Listen: Prospects may drop leading remarks like "I wish I had a television like this one."  Observe: Look at prospects; study their surroundings. Experienced salespeople can determine much about people by observing the way they dress or where they live and work.  Combine: A skillful salesperson may talk to others, listen to a prospect, probe with questions, make careful observations, and empathize—all in an effort to uncover the prospect's needs.  Ask questions: Questions often bring out needs that the prospect would not reveal or does not know. The salesperson asks, "Is a quiet ceiling fan important to you?" "Yes, it is," says the buyer. "If I could provide you with the quietest ceiling fan on the market, would you be interested?"  Talk to others: Ask others about a prospect's needs. For instance, ask an office manager's secretary about the manager's satisfaction with a copy machine.  Empathize: Look at the situation from the customer's point of view. Basically, this is what selling is all about—determining needs and skillfully relating your product's benefits to show how its purchase will fulfill customers' needs. Learning Objective: 04-05 Topic: How to Determine Important Buying Needs—A Key to Success Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 94. What is the purpose of a trial close? What are the best times during a sales presentation for a salesperson to use a trial close? Answer: The trial close is one of the best-selling techniques to use in your sales presentation. It checks the pulse or attitude of your prospect toward the sales presentation. The trial close should be used at these four important times:  After making a strong selling point.  After the presentation is over.  After answering an objection.  Immediately before you move to close the sale. The trial close allows you to determine whether the prospect likes your product's feature, advantage, or benefit; whether you have successfully answered the objection; whether any objections remain; and whether the prospect is ready for you to close the sale. It is a powerful technique to induce two-way communication (feedback) and participation from the prospect. Learning Objective: 04-03 Topic: The Trial Close—A Great Way to Uncover Needs and SELL Blooms: Apply AACSB: AnalyticChapter 04 - The Psychology of Selling: Why People Buy 4-35 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Hard 95. A newly hired salesperson has been told to use the SELL Sequence. What does this mean she should do? Answer: One way to remember to incorporate a trial close in any presentation is the SELL Sequence. The salesperson should remember to incorporate a trial close into her sales presentation, and this is easily done by using the SELL Sequence. The acronym refers to the following:  S - show features  E - explain advantages  L - lead into benefits  L - let customer talk Learning Objective: 04-02 Topic: SELL Sequence Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 96. Briefly describe the FAB selling technique. Show how a salesperson could use the FAB technique to sell a can of regular cola. Answer: The FAB selling technique presents a product's features, advantages, and benefits to a prospect. Students' examples will vary depending on their creativity. An acceptable answer would be: Good taste is a feature. An advantage would be how it quenches thirst. A benefit could be the energy produced as a result of the consumption of sugar and caffeine in the cola. Learning Objective: 04-01 Topic: A FABulous Approach to Buyer Need Satisfaction Blooms: Apply AACSB: Analytic Level of Difficulty: HardChapter 04 - The Psychology of Selling: Why People Buy 4-36 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 97. What are the three types of buying situations? Describe each. Answer: Purchase decisions can usually be classified as to the difficulty involved in deciding which product to buy. These are routine decision making, limited decision making, and extensive decision making.  Routine decision making: Many products are purchased repeatedly. People are in the habit of buying a particular product. They give little thought or time to the routine purchase; they fully realize the product's benefits.  Limited decision making: Moderate level of actual buyer involvement in the decision. Buyers know the general qualities of goods in the product class, but they are not familiar with each brand's features, advantages, and benefits.  Extensive decision making: Buyers seeking to purchase products such as insurance, a home, or an automobile are highly involved in making the buying decision. They may be unfamiliar with a specific brand or type of product and have difficulty in making the purchase decision. This kind of purchase requires more of an investment in time and money than the limited decision. Learning Objective: 04-06 Topic: You Can Classify Buying Situations Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 98. What is the value of technology in selling? Answer: Technology allows the salesperson to sell his buyer the right product, at the right price, in the quantity needed and to have it delivered in a timely manner. Technology provides information for customer decision making and service. With enormous amounts of data and sophisticated computer programs at their fingertips, salespeople can serve customers faster and better. Learning Objective: 04-06 Topic: Technology Provides Information Blooms: Understand AACSB: Technology Level of Difficulty: MediumChapter 04 - The Psychology of Selling: Why People Buy 4-37 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 99. What are the five stages of the consumer buying decision process? What forces and factors are influential to the buyer in each stage? Answer: Buyers, whether individuals or industrial purchasing agents, are constantly exposed to information about various products. Buyers recognize a need, collect information provided by the salesperson, evaluate that information, decide to buy, and after the purchase determine whether they are satisfied. This sequence reveals that several events occur before and after the purchase, all of which the salesperson should consider. Personal, psychological, and social forces also influence consumers' buying behavior. The five steps in this decision process are:  Need arousal  Collection of information  Information evaluation  Purchase decision  Postpurchase behavior Learning Objective: 04-07 Topic: View Buyers as Decision Makers Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 100. Why is it important to emphasize benefits to a prospective buyer? Answer: First, by emphasizing benefits customers can better understand if your product will satisfy their need(s). Your primary purpose is to help the person. Second, stressing benefits in your presentation, rather than features or advantages, will bring success. You will satisfy more people’s needs and thus your sales will increase. Learning Objective: 04-04 Topic: A FABulous Approach to Buyer Need Satisfaction Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 05 - Communication for Relationship Building: It's Not All Talk 5-1 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Chapter 05 Communication for Relationship Building: It's Not All Talk Learning Objectives: 05-01 Present and discuss the salesperson–buyer communication process. 05-02 Determine a person’s personality type. 05-03 Discuss and illustrate the importance of using nonverbal communication when selling. 05-04 Define and recognize acceptance, caution, and disagreement nonverbal signals. 05-05 Explain ways of developing persuasive communication. True / False Questions 1. In a normal two-person conversation, at least 60 percent of the social meaning is expressed verbally. Answer: False Learning Objective: 05-01 Topic: Communication: It Takes Two Blooms: Remember AACSB: Communication Level of Difficulty: Easy Explanation: In a normal two-person conversation, less than 35 percent of the social meaning utilizes verbal components. Much of the social meaning in a conversation is conveyed nonverbally. 2. The receiver is the person for whom communication is intended. Answer: True Learning Objective: 05-01 Topic: Communication: It Takes Two Blooms: Remember AACSB: Communication Level of Difficulty: Easy Explanation: The communication is sent from the source to the receiver. The message is encoded by the source and decoded by the receiver. 3. Social space, the area that is 2 to 3 feet around a person, is the area normally used for sales presentations. Answer: False Learning Objective: 05-03 Topic: Nonverbal Communication: Watch for It Blooms: Understand AACSB: AnalyticChapter 05 - Communication for Relationship Building: It's Not All Talk 5-2 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: The area that is 2 to 4 feet around an individual is considered personal space. Social space is 4 to 12 feet around someone and is the area normally used for sales presentations. 4. Entering a buyer's intimate space before the prospect is ready is endearing to the buyer and helps the salesperson close the sale. Answer: False Learning Objective: 05-03 Topic: Nonverbal Communication: Watch for It Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Entering a prospect’s intimate space can be socially unacceptable and offensive. The buyer may feel threatened or uncomfortable. 5. A desk is commonly used to maintain both personal space and social space between buyers and sellers. Answer: True Learning Objective: 05-03 Topic: Nonverbal Communication: Watch for It Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Barriers, such as a desk, often reduce the threat implied when someone enters another individual’s personal space. Social space is the area normally used for a sales presentation. Again, the buyer often uses a desk to maintain a distance of 4 feet or more between buyer and seller. 6. According to the text, sales representatives should dress in conservative business clothes to enhance their effectiveness in a sales situation. Answer: True Learning Objective: 05-03 Topic: Nonverbal Communication: Watch for It Blooms: Remember AACSB: Communication Level of Difficulty: Easy Explanation: Most experts assert that sales representatives should wear conservative, serious clothing that projects professionalism, just the right amount of authority, and a desire to please the customer. Sporty clothing is believed to accentuate sales aggressiveness, which can place a purchasing agent on the defensive and result in lost sales.Chapter 05 - Communication for Relationship Building: It's Not All Talk 5-3 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 7. The unspoken message in most companies is that freedom in dress may be a privilege of rank. Answer: True Learning Objective: 05-03 Topic: Nonverbal Communication: Watch for It Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: In most firms, it is unwise to dress too individualistically as such freedom of dress comes only through rank. Salespeople should dress professionally and conservatively in most cases. 8. A limp handshake signals aloofness, while a cold fish handshake indicates unfriendliness. Answer: True Learning Objective: 05-03 Topic: Nonverbal Communication: Watch for It Blooms: Remember AACSB: Communication Level of Difficulty: Easy Explanation: A loosely clasped, cold, or limp handshake is usually interpreted as indicating that someone is aloof and unwilling to become involved. This cold fish handshake is also perceived as unaffectionate and unfriendly. 9. General rules for a successful handshake include extending your hand first and not allowing the customer to initiate the gesture because it is a sign of salesperson weakness. Answer: False Learning Objective: 05-03 Topic: Nonverbal Communication: Watch for It Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: General rules for a successful handshake include extending your hand first—if Appropriate. Remember, however, a few people may be uncomfortable shaking hands with a stranger. At times, you may want to allow your customer to initiate the gesture. 10. Acceptance signals indicate that the buyer is favorably inclined toward the salesperson and the sales presentation. Answer: True Learning Objective: 05-03 Topic: Nonverbal Communication: Watch for It Blooms: Remember AACSB: CommunicationChapter 05 - Communication for Relationship Building: It's Not All Talk 5-4 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: Acceptance signals suggest that a buyer is at least willing to listen to a presentation. A smiling, relaxed prospect is sending favorable signals. 11. Facial expressions are the most reliable source of acceptance signals. Answer: False Learning Objective: 05-03 Topic: Nonverbal Communication: Watch for It Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Salespeople frequently rely only on facial expressions as indicators of acceptance. However, this practice may be misleading since buyers may consciously control their facial expressions. 12. The buyer projects caution signals with a body angle that leans toward the salesperson. Answer: False Learning Objective: 05-04 Topic: Nonverbal Communication: Watch for It Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Leaning towards someone is an acceptance signal. A posture of leaning away suggests the buyer is either neutral or skeptical about what the presenter is saying. 13. A salesperson can change caution signals into agreement signals by speeding up a planned presentation. Answer: False Learning Objective: 05-04 Topic: Nonverbal Communication: Watch for It Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Caution signals should be addressed by proceeding slowly with the presentation. Speeding up is likely to increase the level of confusion or disinterest for the buyer.Chapter 05 - Communication for Relationship Building: It's Not All Talk 5-5 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 14. When a salesperson receives disagreement signals, he should immediately stop his planned presentation and quickly adjust to the unplanned situation. Answer: True Learning Objective: 05-04 Topic: Nonverbal Communication: Watch for It Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Disagreement signals indicate that the seller needs to stop the planned presentation and make adjustments. Anger or hostility may develop if the presentation continues. 15. Disagreement signals should alert the salesperson that the prospect is either neutral to or skeptical of what is being said in the sales presentation. Answer: False Learning Objective: 05-04 Topic: Nonverbal Communication: Watch for It Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Caution signal indicate neutrality or skepticism from the buyer. Disagreement signals indicate that the seller needs to stop the planned presentation and make adjustments. 16. A salesperson who receives caution and disagreement signals should ask the prospect open-ended questions to encourage two-way communication. Answer: True Learning Objective: 05-04 Topic: Nonverbal Communication: Watch for It Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: A salesperson should handle disagreement and caution signals similarly − by using open-ended questions and projecting acceptance signals. Open-ended questions may encourage buyers to talk and express their attitudes and beliefs. 17. Salespeople should concentrate more on nonverbal cues that are part of a cluster or pattern rather than isolated gestures. Answer: True Learning Objective: 05-03 Topic: Nonverbal Communication: Watch for It Blooms: Understand AACSB: CommunicationChapter 05 - Communication for Relationship Building: It's Not All Talk 5-6 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: Salespeople should be cautious in interpreting an isolated gesture, such as assuming that little eye contact means the prospect is displeased with what you are saying. Instead, concentrate on nonverbal cues that are part of a cluster or pattern. 18. People can listen approximately twice as fast as they can talk. Answer: True Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Since people can listen (about 400 words per minute) roughly twice as fast as the average rate of speech, it is understandable that a person’s mind may wander while listening to a salesperson’s presentation or that the salesperson may tune out a prospect. 19. Even if a salesperson fails to notice the feedback signals being sent by a prospect, feedback has still occurred. Answer: False Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Feedback does not refer to any specific type of listening behavior by the buyer but rather to a recognizable response. If the salesperson fails to notice or respond to signals, such as a frown or a shake of the head, no feedback can occur, which means faulty or incomplete communication. 20. Self-concept theory asserts that buyers have four images: real self, self-image, ideal self, and looking-glass self. Answer: True Learning Objective: 05-02 Topic: The Buyer’s Personality Should Be Considered Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Self-concept theory asserts that buyers have four images including real self, selfimage, ideal self, and looking-glass self. A salesperson should try to understand the buyer’s self-concept.Chapter 05 - Communication for Relationship Building: It's Not All Talk 5-7 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 21. The ideal self is how people see themselves, and the looking-glass self refers to how people think others regard them. Answer: False Learning Objective: 05-02 Topic: The Buyer’s Personality Should Be Considered Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The ideal self is what people would like to be. Self-image is how people see themselves. The looking-glass self is how people think others regard them. 22. Successful salespeople are true to their own self-image and do not try to match their communication style with that of their prospect. Answer: False Learning Objective: 05-02 Topic: The Buyer’s Personality Should Be Considered Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: In order to be successful, most salespeople have to adapt their own personal style so that they can relate to buyers. Recognizing the personality of the buyer is the first step in making modifications to a presentation style. 23. Probing questions are intended to assess the buyer’s attitude about a sales presentation. Answer: True Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Questioning, sometimes called probing, allows the salesperson to determine the buyer’s attitude toward the sales presentation. Probing refers to gathering information and uncovering customer needs using one or more questions. 24. Empathy is evidenced by a salesperson's display of sincerity and interest in the buyer's situation. Answer: True Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: Remember AACSB: CommunicationChapter 05 - Communication for Relationship Building: It's Not All Talk 5-8 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: Empathy is the ability to identify and understand the other person’s feelings, ideas, and situation. Empathy is evidenced by a salesperson’s display of sincerity and interest in the buyer’s situation. 25. The "KISS" philosophy reminds a salesperson to keep the sales presentation simple. Answer: True Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: Remember AACSB: Communication Level of Difficulty: Easy Explanation: KISS stands for keep it simple, salesperson. Effective salespeople avoid being too technical during their sales presentations. 26. Hearing is the process of deriving meaning from sounds. Answer: False Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: Remember AACSB: Communication Level of Difficulty: Easy Explanation: Hearing refers to being able to detect sounds. Listening is deriving meaning from sounds that are heard. 27. A senser is a people-oriented individual who is sensitive to people’s needs. Answer: False Learning Objective: 05-02 Topic: Adaptive Selling Based on Buyer’s Personality Style Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A senser is an action-oriented person who deals with the world through his or her senses. A feeler is people-oriented and sensitive to the needs of others. 28. Salespeople should deal with sensers in a factual manner using graphs, models, and samples. Answer: True Learning Objective: 05-02 Topic: Adaptive Selling Based on Buyer’s Personality Style Blooms: Understand AACSB: CommunicationChapter 05 - Communication for Relationship Building: It's Not All Talk 5-9 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: When working with sensers, it is important to be brief and to the point. Graphs, models, and samples help the senser visualize a presentation. 29. Marginal listening is the most complex and final level of listening that involves high levels of concentration. Answer: False Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: Remember AACSB: Communication Level of Difficulty: Easy Explanation: Marginal listening, the first and lowest level, involves the least concentration, and typically listeners are easily distracted by their thoughts. Active listening involves the greatest amount of concentration. 30. When engaged in marginal listening, Andrew, the salesperson, focuses on the speaker’s words and tries to see the prospects' point of view. Answer: False Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: The active listener tries to see the other person’s point of view. Marginal listeners are easily distracted and do not concentrate on the message. 31. The evaluative listener tries to hear what another person says but makes little effort to understand the purpose of the message. Answer: True Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: Remember AACSB: Communication Level of Difficulty: EasyChapter 05 - Communication for Relationship Building: It's Not All Talk 5-10 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: An evaluative listener actively tries to hear what the prospect says but isn’t making an effort to understand the intent. Instead of accepting and trying to understand a prospect’s message, the evaluative listener categorizes the statement and concentrates on preparing a response. 32. An active listener refrains from evaluating the message and tries to see the other person's point of view. Answer: True Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: Remember AACSB: Communication Level of Difficulty: Easy Explanation: The active listener refrains from evaluating the message and tries to see the other person’s point of view. Attention is not only on the words spoken but also on the thoughts, feelings, and meaning conveyed. 33. Active listening is the easiest type of listening for a novice salesperson. Answer: False Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: Remember AACSB: Communication Level of Difficulty: Easy Explanation: Active listening is sometimes difficult to do, especially for the novice salesperson. The novice may continue to talk about a particular situation or problem. However, the salesperson must learn to listen. It is a key to sales success. 34. Untrained listeners typically retain 75% of a conversation. Answer: False Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: Remember AACSB: Communication Level of Difficulty: Easy Explanation: An untrained listener is likely to understand and retain only about 50 percent of a conversation. After 48 hours, the retention rate drops to 25 percent. 35. A salesperson’s persuasive abilities are improved with an enthusiastic attitude and effective proof statements. Answer: True Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: UnderstandChapter 05 - Communication for Relationship Building: It's Not All Talk 5-11 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Communication Level of Difficulty: Medium Explanation: Enthusiasm combined with proof statements greatly improves a salesperson’s persuasive ability. Proof statements are statements that substantiate the salesperson’s claims. Multiple Choice Questions 36. From a communications model perspective, the salesperson in a sales call is the: A. interpreter. B. dispatcher. C. receiver. D. source. E. decoder. Answer: D Learning Objective: 05-01 Topic: Communication: It Takes Two Blooms: Remember AACSB: Communication Level of Difficulty: Easy Explanation: The salesperson is the source of the communication. The prospect or buyer is the receiver. 37. You are creating the preparatory notes and slides for a sales presentation. This is a part of the _____ element in the basic communication model. A. encoding B. message C. receiver D. decoding E. feedback Answer: A Learning Objective: 05-01 Topic: Communication: It Takes Two Blooms: Remember AACSB: CommunicationChapter 05 - Communication for Relationship Building: It's Not All Talk 5-12 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: The encoding process is the salesperson’s conversion of ideas and concepts into the language and materials used in the sales presentation, such as notes and slides. 38. Which of the following is the LEAST likely communication method for building longterm relationships based on the Golden Rule of Selling? A. Asking questions periodically B. Assessing body language C. Listening carefully to others D. Making comments when needed E. Becoming multi-lingual Answer: E Learning Objective: 05-01 Topic: The Golden Rule: Communication Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Asking questions, watching non-verbals, listening, and talking as needed are secrets to successfully helping others in a sales situation. Use these secrets of effective communication for building long-term relationships based on the Golden Rule of Selling. 39. In a communication process, the information conveyed by the salesperson to the prospect in a sales presentation is known as the: A. source. B. message. C. transcription. D. source credibility. E. channel feedback tool. Answer: B Learning Objective: 05-01 Topic: Communication: It Takes Two Blooms: Remember AACSB: CommunicationChapter 05 - Communication for Relationship Building: It's Not All Talk 5-13 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: The information intended to be conveyed in a sales presentation is known as the message. The salesperson is the source of the message. 40. The MTI Precision Products salesperson made a sales call to a dentist and described MTI’s new drill as having "unbelievable cutting power" and being "perfectly balanced to reduce hand fatigue." With reference to the communication process, the description of the drill is the: A. transcription. B. feedback. C. source. D. message. E. noise. Answer: D Learning Objective: 05-01 Topic: Communication: It Takes Two Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: The information intended to be conveyed in a sales presentation, such as details about the drill, is known as the message. Noise refers to factors that distort communication, such as interruptions. 41. When you call on a prospect, your words, visual materials, and body language are all used to communicate with your prospect. With reference to the communication process, these are collectively known as: A. feedback generation B. encoding. C. the medium. D. decoding. E. the message. Answer: C Learning Objective: 05-01 Topic: Communication: It Takes Two Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Medium refers to the form of communication used in the sales presentation and discussion, such as words, visual materials, and body language.Chapter 05 - Communication for Relationship Building: It's Not All Talk 5-14 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 42. _____ is the reception and translation of information by the receiver. A. Feedback B. Communication design C. Encoding D. Medium optimization E. Decoding Answer: E Learning Objective: 05-01 Topic: Communication: It Takes Two Blooms: Remember AACSB: Communication Level of Difficulty: Easy Explanation: Decoding is the receiving and interpreting of information by the receiver. Encoding refers to the salesperson’s conversion of ideas into language and materials. 43. The receiver's reaction to the communication is transmitted to the sender through: A. a source response. B. feedback. C. noise. D. decoding. E. translators. Answer: B Learning Objective: 05-01 Topic: Communication: It Takes Two Blooms: Remember AACSB: Communication Level of Difficulty: Easy Explanation: Feedback is the receiver’s reaction to the communication as transmitted to the sender. This reaction may be verbal, nonverbal, or both. 44. The MTI Precision Products salesperson made a sales call to a dentist and described MTI’s new drill as having "unbelievable cutting power" and being "perfectly balanced to reduce hand fatigue." The dentist commented that he has never purchased an MTI drill because they seem overpriced and unreliable. In terms of the communication process, the dentist: A. provided feedback. B. encoded the message. C. created significant noise. D. decoded a nonverbal message. E. altered the communication channel. Answer: A Learning Objective: 05-01 Topic: Communication: It Takes Two Blooms: Understand AACSB: CommunicationChapter 05 - Communication for Relationship Building: It's Not All Talk 5-15 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: Feedback refers to the receiver’s reaction to the communication as transmitted to the sender. The dentist provided verbal feedback about the opinion he has of MTI drills. 45. The concept of _____ space refers to the area around the self into which a person will not allow another person without consent. A. territorial B. adjacent C. secured D. private E. controlled Answer: A Learning Objective: 05-03 Topic: Nonverbal Communication: Watch for It Blooms: Remember AACSB: Communication Level of Difficulty: Easy Explanation: The concept of territorial space refers to the area around the self that a person will not allow another person to enter without consent. Early 46. A distance of up to two feet around an individual is defined as: A. controlled space. B. low distance. C. close space. D. intimate space. E. adjacency. Answer: D Learning Objective: 05-03 Topic: Nonverbal Communication: Watch for It Blooms: Remember AACSB: Communication Level of Difficulty: Easy Explanation: Intimate space is a sensitive zone that is an arm’s length around a person. Territorial space is the area around a person that no one can enter without permission. 47. Jack Stewart sells ski equipment to retailers. On a recent sales call, a large fly kept buzzing around the room which prevented his prospect from listening to the sales presentation. In terms of the communication process, the fly was an example of: A. noise. B. a caution signal. C. negative feedback. D. a disagreement signal. E. an alternate communication channel. Answer: A Learning Objective: 05-01Chapter 05 - Communication for Relationship Building: It's Not All Talk 5-16 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Topic: Communication: It Takes Two Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Noise consists of any factors that distort communication between buyer and seller. Noise includes barriers to communication, such as culture, language, and interruptions. 48. If you enter into a new prospect's _____ space without his/her permission, the prospect may not only find your behavior socially unacceptable, but also possibly offensive. A. collective B. intimate C. social D. shared E. public space Answer: B Learning Objective: 05-03 Topic: Nonverbal Communication: Watch for It Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Intimate space of up to 2 feet is the most sensitive zone, and it is reserved for close friends and loved ones. To enter intimate space in the buyer–seller relationship, for some prospects, could be socially unacceptable—possibly offensive. 49. Identify the area that is normally used for a sales presentation. A. Communal space B. Intimate space C. Social space D. Personal space E. Public space Answer: C Learning Objective: 05-03 Topic: Nonverbal Communication: Watch for It Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Social space is the area normally used for a sales presentation. The buyer often uses a desk to maintain a distance of 4 feet or more between buyer and seller.Chapter 05 - Communication for Relationship Building: It's Not All Talk 5-17 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 50. The closest zone a stranger or business acquaintance is normally allowed to enter is called an individual’s _____ space. A. controlled B. intimate C. social D. public E. personal Answer: E Learning Objective: 05-03 Topic: Nonverbal Communication: Watch for It Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Personal space is usually as close as a stranger should be to another person. Public space is the usual distance between a teacher and students in a classroom. 51. A medical supplies salesperson walks into a hospital administrator's office. The administrator invites the salesperson to sit in a chair directly across the desk from her. Into which space zone is the salesperson being placed? A. Intimate B. Communal C. Social D. Personal E. Public Answer: c Learning Objective: 05-03 Topic: Nonverbal Communication: Watch for It Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Social space is usually a distance of 4 feet or more, which is approximately the distance across a desk. A chair beside a prospect’s desk would most likely be in personal space.Chapter 05 - Communication for Relationship Building: It's Not All Talk 5-18 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 52. In most offices, the salesperson sits directly across the desk from the prospect. This defensive barrier allows the prospect to control much of the conversation and remain safe from: A. space hijack. B. territory assault. C. space invasion. D. personal intrusion. E. information overload. Answer: C Learning Objective: 05-03 Topic: Nonverbal Communication: Watch for It Blooms: Remember AACSB: Communication Level of Difficulty: Easy Explanation: In most offices, the salesperson sits directly across the desk from the prospect. The prospect controls the space arrangement. This defensive barrier allows the prospect to control much of the conversation and remain safe from space invasion. 53. Assume that you are a male salesperson. What advice does the text give you about the length of your hair? A. Wear your hair long to show an optimistic outlook on life. B. Use hair styling products to maintain a stylish appearance. C. Wear your hair short to suggest a conservative, professional, and business-like approach. D. Wear your hair at a medium length to avoid offending prospects that prefer long or short hair. E. Consider the types of customers you will be calling on and select your hairstyle accordingly. Answer: B Learning Objective: 05-03 Topic: Nonverbal Communication: Watch for It Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Hairstyle traditionally has been important in evaluating personal appearance. Today’s salespeople must consider the type of customer they call on and adjust their hairstyles accordingly.Chapter 05 - Communication for Relationship Building: It's Not All Talk 5-19 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 54. According to the text, which of the following is a true statement regarding business attire? A. Clothes send a vocal message about the salesperson. B. Few major corporations still encourage conservative clothing. C. A salesperson’s wardrobe plays a significant factor in sales success. D. Sporty clothing and business casual are appropriate in most situations. E. Overly conservative clothing highlights a salesperson’s aggressiveness. Answer: C Learning Objective: 05-03 Topic: Nonverbal Communication: Watch for It Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Wardrobe has always been a major determinant of sales success, and today it is emphasized as never before. Conservative, serious clothing projects professionalism and just the right amount of authority, while sporty clothing is believed to accentuate sales aggressiveness 55. International protocol for handshaking dictates that it is appropriate to: A. avoid initiating handshakes if you are a woman. B. pull your hand away quickly in all cultures. C. give very brief, strong handshakes in Arab countries. D. shake hands three times with Japanese businesspersons. E. shake hands with everyone in the room in all cultures. Answer: E Learning Objective: 05-03 Topic: Nonverbal Communication: Watch for It Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: International protocol dictates that you shake hands with everyone in a room because omissions are considered a rejection. Women should initiate handshakes, and shake hands with other women and men. 56. Which of the following best describes Western and Eastern European handshakes? A. Reshake hands after a lunch or a short break B. Bow slightly while shaking hands with women C. Shake hands in a limp fashion for a longer duration D. Shake hands in a light and lingering fashion E. Shake hands with only the key person in a group Answer: A Learning Objective: 05-03 Topic: Nonverbal Communication: Watch for It Blooms: Understand AACSB: CommunicationChapter 05 - Communication for Relationship Building: It's Not All Talk 5-20 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: In Western and Eastern European cultures, it is appropriate to reshake hands whenever people are apart for even a short period of time, such as lunch. 57. Which of the following is an acceptance signal? A. Uncrossed legs B. Leaning backward C. Little eye contact D. Closed arms E. Closed hands Answer: A Learning Objective: 05-04 Topic: Nonverbal Communication: Watch for It Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Uncrossed legs are a sign of acceptance. Leaning backward, closed arms and hands, and minimal eye contact are signs of caution or disagreement. 58. When the buyer is leaning forward or upright, the buyer is projecting _____ signals. A. caution B. disagreement C. acceptance D. inhibitory E. instructive Answer: C Learning Objective: 05-04 Topic: Nonverbal Communication: Watch for It Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Acceptance signals indicate that your buyer is favorably inclined toward you and your presentation. Leaning forward and smiling are signs of acceptance. 59. Controlling space arrangement and using it as a defensive barrier allows the prospect to control much of the conversation and to remain safe from: A. space threats. B. territorial assailants. C. space invasions. D. territorial intruders. E. trespassers. Answer: c Learning Objective: 05-03 Topic: Nonverbal Communication: Watch for It Blooms: UnderstandChapter 05 - Communication for Relationship Building: It's Not All Talk 5-21 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Medium Explanation: The prospect controls the space arrangement to prevent space invasions. This defensive barrier allows the prospect to control much of the conversation and remain safe from territorial encroachment. 60. Maria sells women's accessories. Her prospective buyer is smiling and eyeing the samples that Maria brought for the sales presentation. The prospect's legs are uncrossed, and her arms are relaxed. Maria should: A. use open-ended questions to determine the buyer's objections. B. stop her planned presentation and reduce sales pressure. C. attempt to close the sale without using the samples. D. continue as planned with the sales presentation. E. accept that the buyer is an unqualified prospect. Answer: D Learning Objective: 05-03 Topic: Nonverbal Communication: Watch for It Blooms: Apply AACSB: Communication Level of Difficulty: Hard Explanation: Acceptance signals like smiling and being relaxed indicate that the buyer is favorably inclined toward Maria and her products. Maria should continue as planned because the presentation is going well. 61. As you discuss your proposition with your potential buyer, you notice that she is leaning away from you and staring mostly at the paperweight she is fidgeting with. You are receiving _____ signals. A. rejection B. disagreement C. caution D. intimidation E. withdrawal Answer: C Learning Objective: 05-03 Topic: Nonverbal Communication: Watch for It Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Fidgeting with something and leaning away from a salesperson are caution signals. The salesperson needs to make adjustments to the sales presentation to gain the buyer’s attention.Chapter 05 - Communication for Relationship Building: It's Not All Talk 5-22 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 62. Salespeople should immediately stop the planned presentation and quickly adjust to the situation when they receive _____ signals. A. caution B. warning C. territorial D. watchfulness E. disagreement Answer: E Learning Objective: 05-04 Topic: Nonverbal Communication: Watch for It Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Disagreement signals tell you immediately to stop the planned presentation and quickly adjust to the situation. Disagreements, or red-light signals, indicate that you are dealing with a person becoming uninterested in your product. 63. Why is it important for a salesperson to be aware of caution signals? A. They indicate blocked communication. B. They usually lead to the next step, which is buyer acceptance. C. They signal the salesperson to speed up the sales presentation. D. They warn the salesperson to close the deal quickly before a competitor does. E. They tell the salesperson to respond with similar signals to proceed on an equal footing with the buyer. Answer: A Learning Objective: 05-04 Topic: Nonverbal Communication: Watch for It Blooms: Analyze AACSB: Analytic Level of Difficulty: Hard Explanation: Caution signals are important to recognize because they indicate blocked communication. Buyers’ perceptions, attitudes, and beliefs regarding a presentation may cause them to be skeptical, judgmental, or uninterested in the product. 64. All of the following can help change caution signals into acceptance signals EXCEPT: A. being positive and enthusiastic. B. changing the planned presentation. C. asking open-ended questions. D. carefully listening to the buyer's message. E. continuing with the presentation. Answer: E Learning Objective: 05-04 Topic: Nonverbal Communication: Watch for It Blooms: Understand AACSB: CommunicationChapter 05 - Communication for Relationship Building: It's Not All Talk 5-23 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: Caution signals can be addressed by adjusting the presentation, being positive, encouraging the buyer to talk, and listening carefully to the buyer. Continuing the presentation may lead to hostility. 65. Lee sells industrial-sized refrigeration units. Her prospective buyer's face looks tense, and his forehead is wrinkled. The buyer is avoiding looking at Lee's eyes and he has his arms crossed over his chest. Lee should: A. ask closed-ended questions. B. apologize for her intrusion and leave. C. let the buyer know that she is aware that something is bothering him. D. assume the buyer has reached the interest stage. E. continue her presentation with added pressure. Answer: C Learning Objective: 05-04 Topic: Nonverbal Communication: Watch for It Blooms: Apply AACSB: Communication Level of Difficulty: Hard Explanation: The salesperson should directly address the buyer about his concerns and reduce the pressure to communicate. Continuing the presentation or asking closed-ended questions will aggravate the situation. 66. Persuasion is defined as: A. a means of creating an immediate erosion of territorial space. B. a coercive motivational tool used to change public interests. C. the ability to change a person's belief, position, or course of action. D. an unethical tool for handling legitimate objections. E. the ability to create supply and demand. Answer: C Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 05 - Communication for Relationship Building: It's Not All Talk 5-24 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Persuasion means the ability to change a person’s belief, position, or course of action. The more effective you are at communicating, the greater your chances of being successful at persuasion. 67. According to the text, the two skills needed to be an effective sales communicator are: A. requesting and receiving persuasive signals. B. asking and answering open-ended questions. C. organizing and summarizing statistics. D. preparing and presenting information. E. encoding and decoding messages. Answer: E Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Good salespeople are able to encode and decode during sales presentations. Communicating effectively enables a salesperson to be persuasive. 68. During sales presentations, Tyrone, a computer salesperson, asks prospects various questions about previous experiences with other computers and their opinions about the quality and price of the computers he sells. Tyrone uses _____, a good tool of the successful salesperson. A. selective questioning B. problem solving C. targeting D. probing E. empathy Answer: D Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Questioning, sometimes called probing, allows the salesperson to determine the buyer’s attitude toward the sales presentation. Probing refers to gathering information and uncovering customer needs using one or more questions.Chapter 05 - Communication for Relationship Building: It's Not All Talk 5-25 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 69. The appliance salesperson asked the prospect, "What do you like best about the competitor's washing machines?" "Do you think you have ever paid too much for a new washer?" "Are you happy with how well your current washer cleans your clothes?" The salesperson, in this case, has used: A. probing. B. channeling. C. targeting. D. detail selling. E. empathizing. Answer: A Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Questioning, sometimes called probing, allows the salesperson to determine the buyer’s attitude toward the sales presentation. Probing refers to gathering information and uncovering customer needs using one or more questions. 70. Which term refers to gathering information and uncovering customer needs by using one or more questions? A. Channeling B. Probing C. Signaling D. Empathizing E. Interrogating Answer: B Learning Objective: 04-05 Topic: Master Persuasive Communication to Maintain Control Blooms: Remember AACSB: Communication Level of Difficulty: Easy Explanation: Questioning, sometimes called probing, allows the salesperson to determine the buyer’s attitude toward the sales presentation. Probing refers to gathering information and uncovering customer needs using one or more questions.Chapter 05 - Communication for Relationship Building: It's Not All Talk 5-26 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 71. Which of the following statements about feedback is most likely INCORRECT? A. In planning a presentation, it is impossible to predetermine when and what feedbackproducing questions to ask. B. If a salesperson fails to notice the feedback signals being sent by a prospect, no feedback occurred. C. It may be appropriate to use questions that obtain negative feedback. D. It may be appropriate to use questions that obtain positive feedback. E. Feedback can be verbal or nonverbal. Answer: A Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Many salespeople plan in advance to ask questions to buyers that will draw negative and positive feedback. Feedback only takes place if the salesperson notices and interprets verbal and nonverbal signals from the buyer. 72. According to the text, MCI salespeople plan questions to ask during sales presentations for the purpose of: A. assessing verbal and nonverbal feedback about MCI. B. requesting additional information about MCI products. C. gathering statistical information for MCI management. D. providing positive feedback about MCI products to buyers. E. determining how a prospect feels about an MCI competitor. Answer: E Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Questions by MCI salespeople were intended to draw negative responses from the customers concerning the relationship with their present supplier. They provided the MCI salespeople with a method of determining how the prospect felt about the competitor.Chapter 05 - Communication for Relationship Building: It's Not All Talk 5-27 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 73. In terms of the communication process, probing stimulates which of the following? A. Sending B. Decoding C. Receiving D. Feedback E. Channeling Answer: D Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: By interjecting into the presentation questions that require the customer to give a particular response, you can stimulate feedback. Probing allows the salesperson to determine the buyer’s attitude toward the sales presentation 74. _____ is the ability to identify and understand the other person's feelings, ideas, and situation. A. Persuasion B. Empathy C. Enthusiasm D. Conviction E. Affiliation Answer: B Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: Remember AACSB: Communication Level of Difficulty: Easy Explanation: Empathy is the ability to identify and understand the other person’s feelings, ideas, and situation. Empathy is evidenced by a salesperson’s display of sincerity and interest in the buyer’s situation. 75. The salesperson was using _____ in her sales presentation when she said, "I was so sorry to hear about the break-in at your warehouse. Is there any way that I can help you deal with this problem?" A. persuasion B. decoding C. a trial close D. signaling E. empathy Answer: E Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: UnderstandChapter 05 - Communication for Relationship Building: It's Not All Talk 5-28 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Communication Level of Difficulty: Medium Explanation: Empathy is the ability to identify and understand the other person’s feelings, ideas, and situation. Empathy is evidenced by a salesperson’s display of sincerity and interest in the buyer’s situation. 76. Empathy is defined as the ability to: A. adjust communication signals. B. recognize and respond to buyer feedback. C. identify and understand the other person's feelings. D. change a person's beliefs, position, or course of action. E. uncover customer needs by using one or more questions. Answer: C Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: Remember AACSB: Communication Level of Difficulty: Easy Explanation: Empathy is the ability to identify and understand the other person’s feelings, ideas, and situation. Empathy is evidenced by a salesperson’s display of sincerity and interest in the buyer’s situation. 77. The KISS rule advises a salesperson to: A. ask questions to generate feedback. B. maintain a simple presentation style. C. remember how important empathy is. D. offer persuasive and innovative solutions. E. listen closely to the buyer's initial responses. Answer: B Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: Remember AACSB: CommunicationChapter 05 - Communication for Relationship Building: It's Not All Talk 5-29 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: KISS stands for keep it simple, salesperson. Overly complex and highly technical presentation should be avoided when possible. 78. A flower distributor asked the Fresh Farms sales representative if the company had any red roses in stock. The sales representative listed six varieties of red roses and 27 varieties of reddish-pink roses that Fresh Farms had available. The sales representative most likely forgot to follow the: A. L-O-C-A-T-E rule. B. SELL sequence. C. Golden Rule. D. SWOT analysis. E. KISS rule. Answer: E Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: KISS stands for keep it simple, salesperson. Overly complex and highly detailed responses and presentations should be avoided when possible. 79. Imagine you sell radio advertising and you have just made a sales call at Leon Travel Agency. You notice that Mr. Leon's desk is messy and that his tie is loose. Mr. Leon seems energetic, assertive, and impatient, so you conclude that he is the _____ personality type. A. senser B. instigator C. intuitor D. feeler E. thinker Answer: A Learning Objective: 05-02 Topic: Adaptive Selling Based on Buyer’s Personality Style Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A senser personality tends to decisive, energetic, and impatient as well as unkempt. A feeler personality style is people oriented, spontaneous, and loyal. The thinker style of person places high value on logic, ideas, and systematic inquiry. An intuitor places high value on ideas, innovation, concepts, theory, and long-range thinking.Chapter 05 - Communication for Relationship Building: It's Not All Talk 5-30 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 80. Aaron enjoys spending time with customers, often makes spontaneous sales calls, and has a tendency to postpone writing reports. His desk is full of pictures of his many children and grandchildren. What personality type is Aaron? A. Senser B. Engineer C. Intuitor D. Feeler E. Thinker Answer: D Learning Objective: 05-02 Topic: Adaptive Selling Based on Buyer’s Personality Style Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A feeler personality style is people oriented, spontaneous, and sentimental. The thinker style of person places high value on logic, ideas, and systematic inquiry. An intuitor places high value on ideas, innovation, concepts, theory, and long-range thinking. 81. According to self-concept theory, which term refers to how people see themselves? A. Real self B. Self-image C. True self D. Ideal self E. Looking-glass self Answer: B Learning Objective: 05-02 Topic: The Buyer’s Personality Should Be Considered Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: People possess four images according to the self-concept theory. Self-image is how people view themselves, and real self is how people actually are. Ideal self is what people want to be, and looking-glass self is how people think others regard them. 82. Under _____ listening, listeners are easily distracted by their thoughts; the message is heard, but it does not sink in. A. dynamic B. subsidiary C. marginal D. evaluative E. active Answer: C Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: RememberChapter 05 - Communication for Relationship Building: It's Not All Talk 5-31 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Communication Level of Difficulty: Easy Explanation: Marginal listening, the first and lowest level, involves the least concentration, and typically listeners are easily distracted by their thoughts. Evaluative listening involves more concentration and attention to the speaker’s words. 83. John Hagen, a veteran appliance salesperson, is in an interview with a potential prospect. As the prospect talks about how more people are renting appliances rather than buying them, Hagen replies, "Really? That’s interesting. So how many refrigerators do you want to order?” Hagen is most likely engaged in _____ listening. A. marginal B. active C. evaluative D. routine E. borderline Answer: A Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Marginal listening, the first and lowest level, involves the least concentration. John hears the message from the prospect about appliance rentals, but the message doesn’t sink in and he moves forward with asking about the order. The prospect will most likely notice John’s lack of attention. 84. At the _____ level of listening, the listener actively tries to hear what the prospect says but does not make an effort to understand the intent. A. dynamic B. passive C. marginal D. active E. evaluative Answer: E Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: Remember AACSB: Communication Level of Difficulty: Easy Explanation: Evaluative listening involves some concentration and attention to the speaker’s words but the speaker fails to try to understand the intent of the message. Marginal listening, the first and lowest level, involves the least concentration.Chapter 05 - Communication for Relationship Building: It's Not All Talk 5-32 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 85. Joel recently attended a seminar on improving listening skills. Because of what he learned at the seminar, he is actively trying to hear what the prospect is saying. However, he is not making an effort to understand the prospect's intent. At what level is Joel listening? A. Evaluative B. Routine C. Dynamic D. Active E. Marginal Answer: A Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Evaluative listening involves some concentration and attention to the speaker’s words but the speaker fails to try to understand the intent of the message. Marginal listening, the first and lowest level, involves the least concentration. 86. When we are engaged in _____ listening, it is easy to become distracted by emotion-laden words. Instead of listening to the prospect, we may become obsessed with the offensive words and wonder what to do about them. A. marginal B. passive C. active D. evaluative E. routine Answer: D Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: Remember AACSB: Communication Level of Difficulty: Easy Explanation: Evaluative listening involves some concentration and attention to the speaker’s words but the speaker fails to try to understand the intent of the message. Marginal listening, the first and lowest level, involves the least concentration.Chapter 05 - Communication for Relationship Building: It's Not All Talk 5-33 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 87. As she listens to her customer, Denise refrains from evaluating the message and considers the customer's point of view. Denise is engaged in _____ listening. A. dynamic B. participative C. non-routine D. active E. responsive Answer: D Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: The active listener refrains from evaluating the message and tries to see the other person’s point of view. Attention is not only on the words spoken but also on the thoughts, feelings, and meaning conveyed. 88. Which of the following would LEAST likely improve a salesperson’s listening skills? A. Asking questions to clarify meaning B. Watching for nonverbal messages C. Projecting positive nonverbal signals D. Recognizing feelings and emotions E. Focusing on emotion-filled words Answer: E Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Improving listening skills can be accomplished by asking the speaker questions, observing nonverbal signs, giving positive nonverbal signals, and acknowledging the feelings of the speaker. Focusing on emotional words hinders the listening process. 89. Enthusiasm in sales is the ability to: A. express a desire for long-term relationships. B. show excitement toward a product or customer. C. turn disagreement signals into acceptance signals. D. understand the other person's feelings and situation. E. change a person's belief, position, or course of action. Answer: B Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 05 - Communication for Relationship Building: It's Not All Talk 5-34 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Being an enthusiastic person who radiates a positive attitude creates interest in other people. Customers want to feel that a salesperson is happy to see them. 90. Pharmaceutical companies often quote research studies performed by outstanding physicians at prestigious medical schools to validate claims of product benefits. This is an example of the use of: A. proof statements. B. image advertising. C. customer referrals. D. interactive advertising. E. reflective advertising. Answer: A Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: A proof statement is a document that supports a salesperson’s claims. Research studies and expert opinions serve as proof statements. Essay Questions 91. Define communication in a sales context and list the major elements in a basic communication model. Answer: Communication, in a sales context, is the act of transmitting verbal and nonverbal information and understanding between buyer and seller. The definition presents communication as an exchange process of sending and receiving messages. The basic communication model has eight elements: source, encoding process, message, medium, decoding process, receiver, feedback, and noise. Learning Objective: 05-01 Topic: Communication: It Takes Two Blooms: Understand AACSB: Communication Level of Difficulty: Medium 92. What are the five communication mediums that a buyer uses to send nonverbal signals? Why should salespeople recognize such signals? Answer: The five communication modes are body angle, facial expression, arm movement or position, hand movements or position, and leg position. Salespeople can determine through nonverbal signals whether a prospect in interested or not and make sales presentation adjustments accordingly. Learning Objective: 05-03 Topic: Nonverbal Communication: Watch for It Blooms: Analyze AACSB: CommunicationChapter 05 - Communication for Relationship Building: It's Not All Talk 5-35 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Hard 93. Explain the concept of territorial space. Why should salespeople be aware of the physical space between themselves and their prospects? Answer: Territorial space refers to the area around the self that a person will not allow another person to enter without consent. This idea has been applied to socially acceptable distances of space that human beings keep between themselves in certain situations. A person (buyer) has four main types of distance to consider—intimate (up to 2 feet); personal (2 to 4 feet); social (4 to 12 feet); and public (greater than 12 feet). Space considerations are important to salespeople because a violation of territorial space without customer consent may set off the customer's defense mechanisms and create a barrier to communication. Learning Objective: 05-03 Topic: Nonverbal Communication: Watch for It Blooms: Analyze AACSB: Analytic Level of Difficulty: Hard 94. Give three examples of probing questions that could be asked by someone selling new cars. Answer: Students' answers will vary based on their creativity. Examples include "What kind of car do you picture yourself driving?" "How do you plan to use the car?" "What kind of sacrifices are you willing to make so that your car will not add to pollution problems?" "What kinds of cars do your family and friends drive?" "What made you think you might want to own this model of car?" Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: Apply AACSB: Communication Level of Difficulty: Hard 95. What are caution signals? What are some examples of caution signals? Why is it important for a salesperson to recognize and adjust a presentation when a buyer is showing caution signals? Answer: Caution signals should alert you that buyers are either neutral or skeptical toward what you say. Caution signals are indicated by a person leaning away from you, a puzzled expression, crossed arms, and crossed legs. Caution signals indicate blocked communication. If caution signals are not handled properly, they can evolve into disagreement signals. Learning Objective: 05-04 Topic: Nonverbal Communication: Watch for It Blooms: Apply AACSB: Communication Level of Difficulty: HardChapter 05 - Communication for Relationship Building: It's Not All Talk 5-36 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 96. Discuss the dos and don'ts of handshakes in a business situation. Answer: Today, a handshake is considered a revealing gesture. A firm handshake is more intense and is indicative of greater liking and warmer feelings. A prolonged handshake is more intimate than a brief one, and it could cause the customer discomfort, especially in a sales call on a new prospect. A loosely clasped, cold, or limp handshake is usually interpreted as indicating that someone is aloof and unwilling to become involved. General rules for a successful handshake include extending your hand first. However, a few people may be uncomfortable shaking hands with a stranger and you may want to allow your customer to initiate the gesture. Maintain eye contact with the customer during the handshake, gripping the hand firmly. Learning Objective: 05-03 Topic: Nonverbal Communication: Watch for It Blooms: Understand AACSB: Communication Level of Difficulty: Medium 97. What is an acceptance signal? Provide a few examples of actions that could be acceptance signals. Answer: Acceptance signals indicate that your buyer is favorably inclined toward you and your presentation. These signals give you the green light to proceed. Body angle leaning forward or upright at attention, smiling and pleasant face, and relaxed and open arms are some of the common acceptance signals. Learning Objective: 05-04 Topic: Nonverbal Communication: Watch for It Blooms: Understand AACSB: Communication Level of Difficulty: Medium 98. What is the difference between hearing and listening? Why is it important for salespeople to do both? How can salespeople encourage buyers to listen? Answer: Hearing refers to being able to detect sounds. Listening is deriving meaning from sounds that are heard. Salespeople often believe that their job is to talk rather than to listen. If they both talk and listen, their persuasive powers increase. To keep the buyer listening, ask questions, get the buyer involved in the conversation, and show visual aids. Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: Analyze AACSB: Communication Level of Difficulty: HardChapter 05 - Communication for Relationship Building: It's Not All Talk 5-37 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 99. What are the characteristics of thinkers and feelers? How should a salesperson adapt a presentation for each type of person? Answer: A thinker places high value on logic, ideas, and systematic inquiry. Completely preplan your presentation with ample facts and supporting data and be precise. Present your material in an orderly and logical manner. In contrast, a feeler places high value on being people oriented and sensitive to people’s needs. The main point to include in your presentation is the impact your idea will have on people. The feeler likes to small talk with you, so engage in conversation and wait for this person’s cue to begin your presentation. Use emotional terms and deep the presentation on a personal note. Learning Objective: 05-02 Topic: Adaptive Selling Based on Buyer’s Personality Style Blooms: Apply AACSB: Communication Level of Difficulty: Hard 100. Briefly explain the three levels of listening. Answer: The three levels of listening are: marginal, evaluative, and active. These levels require various degrees of concentration by the listener. As you move from the first to the third level, the potential for understanding and clear communication increases.  Marginal listening is the first and lowest level. It involves the least concentration, and typically listeners are easily distracted by their thoughts. During periods of marginal listening, a listener exhibits blank stares, nervous mannerisms, and gestures that annoy the prospect and cause communication barriers.  Evaluative listening is the second level of listening, and requires more concentration and attention to the speaker's words. At this level, the listener actively tries to hear what the prospect says but isn't making an effort to understand the intent.  Active listening is the third and most effective level of listening. The active listener refrains from evaluating the message and tries to see the other person's point of view. Learning Objective: 05-05 Topic: Master Persuasive Communication to Maintain Control Blooms: Understand AACSB: Communication Level of Difficulty: MediumChapter 06 - Sales Knowledge: Customers, Products, Technologies 6-1 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Chapter 06 Sales Knowledge: Customers, Products, Technologies Learning Objectives: 06-01 Explain why it is so important to be knowledgeable. 06-02 Discuss the major body of knowledge needed for increased sales success. 06-03 Illustrate how to use this knowledge during the sales presentation. 06-04 Explain the main technologies used by salespeople. True / False Questions 1. Knowledge of selling is gained only through formal classes, which is why firms invest so heavily in employee training programs. Answer: False Learning Objective: 06-01 Topic: Sources of Sales Knowledge Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Like many professional careers, selling is a skill that is truly developed only through experience. Sales knowledge obtained through education, reading, formalized sales training, and word-of-mouth is helpful in enhancing overall sales ability, but actual experience is the critical source of sales knowledge. 2. According to the Golden Rule of Personal Selling, most customers do not care how much a salesperson knows about a product until the salesperson shows honesty and caring. Answer: True Learning Objective: 06-01 Topic: The Golden Rule: Knowledge Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: Placing the customer’s welfare before one’s own welfare is key to having a successful sales career according to the Golden Rule of Personal Selling. It is important to remember that people do not care how much you know until they know how much you care. 3. According to the text, salespeople who are product experts develop ethical, long-term relationships with customers. Answer: False Learning Objective: 06-01 Topic: The Golden Rule: Knowledge Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: It is important to remember that people do not care how much you know until they know how much you care. Ethical service builds customer relationships and is based on the truth.Chapter 06 - Sales Knowledge: Customers, Products, Technologies 6-2 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 4. Sales training is the effort put forth by an employer to provide the opportunity for the salesperson to receive job-related skills and knowledge that improve sales success. Answer: True Learning Objective: 06-01 Topic: Sources of Sales Knowledge Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Sales training is the effort an employer puts forth to provide the opportunity for the salesperson to receive job-related culture, skills, knowledge, and attitudes that result in improved performance in the selling environment. Successful companies thoroughly train new salespeople and maintain ongoing training programs for their experienced sales personnel. 5. National advertising is sometimes limited to the top 100 markets in order to provide more punch per ad dollar. Answer: True Learning Objective: 06-03 Topic: Advertising Aids Salespeople Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: National advertising is advertising designed to reach all users of the product, whether consumers or industrial buyers. In some cases, national advertisers may restrict their expenditures to the top 100 markets. Therefore, the advertiser gets more punch per ad dollar. 6. Cooperative advertising is paid for by retailers and designed to reach industrial buyers. Answer: False Learning Objective: 06-03 Topic: Advertising Aids Salespeople Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Cooperative, or co-op, advertising is advertising the retailer conducts with the cost paid for by the manufacturer or shared by the manufacturer and retailer. It is an attractive selling tool for the salesperson to give the buyer an advertising allowance to promote a firm’s goods. 7. Trade advertising is advertising the retailer conducts with the cost shared between manufacturer and retailer. Answer: False Learning Objective: 06-03 Topic: Advertising Aids Salespeople Blooms: Remember AACSB: AnalyticChapter 06 - Sales Knowledge: Customers, Products, Technologies 6-3 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: Trade advertising is undertaken by the manufacturer and directed toward the wholesaler or retailer. Cooperative advertising is advertising the retailer conducts with the cost paid for by the manufacturer or shared by the manufacturer and retailer. 8. Carla Piretti is a manager of a plant that processes recycled plastic and sells it to other companies. She recently saw an advertisement for a machine that would help her company reduce the cost of reclaiming the recycled plastic by 20 percent. This ad is an example of trade advertising. Answer: False Learning Objective: 06-03 Topic: Advertising Aids Salespeople Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The ad for a machine is a type of industrial advertising that is aimed at individuals and organizations that purchase products for use in manufacturing. 9. To reduce the amount of time that must be devoted to sales training, modern companies do not teach their salespeople about the company's history. Answer: False Learning Objective: 06-02 Topic: Know Your Company Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Knowledge of your firm’s development since its origin provides you with promotional material and builds your confidence in the company. Firms such as IBM still provide personnel with information about the company’s history and development. 10. Direct-mail advertising helps expose users to a product or remind them that the product is available to meet a specific need. Answer: True Learning Objective: 06-03 Topic: Advertising Aids Salespeople Blooms: Remember AACSB: AnalyticChapter 06 - Sales Knowledge: Customers, Products, Technologies 6-4 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: Direct-mail advertising is mailed directly to the consumer or industrial user; it is an effective method of exposing these users to a product or it reminds them that the product is available to meet a specific need. Often, trial samples or coupons accompany direct-mail advertising. 11. Monitoring advertising and sales promotion activities enables salespeople to include current data and prices into sales presentations. Answer: True Learning Objective: 06-03 Topic: Advertising Aids Salespeople Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Keeping abreast of your company’s advertising and sales promotion activities is a must. By incorporating these data into your sales presentation, you can provide customers with a world of information that they probably know little about and that can secure the sale. 12. One of the reasons companies advertise is because they hope to reduce cognitive dissonance over a purchase. Answer: True Learning Objective: 06-03 Topic: Advertising Aids Salespeople Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Firms advertise for many reasons including to reduce a buyer’s cognitive dissonance after a purchase. Firms want consumers to feel confident about the money they spend on products, and advertising helps facilitate this goal. 13. Industrial advertising has more specified channels of communication and a smaller number of potential customers, leading to lower advertising costs. Answer: True Learning Objective: 06-03 Topic: Advertising Aids Salespeople Blooms: Remember AACSB: AnalyticChapter 06 - Sales Knowledge: Customers, Products, Technologies 6-5 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: Because industrial advertising has more specified channels of communication (such as trade periodicals and trade shows) and a smaller number of potential customers, advertising costs tend to be lower. 14. With reference to sales promotion, POP stands for price-on-purchase. Answer: False Learning Objective: 06-02 Topic: Sales Promotion Generates Sales Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Point-of-purchase (POP) displays allow a product to be seen easily and purchased. A product POP display may include photographs, banners, drawings, coupons, counter displays, or floor stands. 15. Shelf facing refers to the number of individual products placed side-by-side on the shelf. Answer: True Learning Objective: 06-02 Topic: Sales Promotion Generates Sales Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Shelf facings are the number of individual products placed beside each other on the shelf. Shelf positioning can stimulate sales. 16. A primary obstacle faced by a salesperson who is trying to get shelf space for a new product is limited retail store space. Answer: True Learning Objective: 06-02 Topic: Sales Promotion Generates Sales Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The major obstacle faced when attempting to obtain shelf space for products is limited space. A retail store has a fixed amount of display space and thousands of products to stock. 17. A premium is an article of merchandise offered as an incentive to encourage the user to take some action. Answer: True Learning Objective: 06-03 Topic: Sales Promotion Generates Sales Blooms: Remember AACSB: AnalyticChapter 06 - Sales Knowledge: Customers, Products, Technologies 6-6 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: A premium is an article of merchandise offered as an incentive to the user to take some action. The premium may act as an incentive to buy, to sample the product, to come into the retail store, or to stir interest so the user requests further information. 18. Premiums are used solely to encourage customers to come into the retailer store. Answer: False Learning Objective: 06-03 Topic: Sales Promotion Generates Sales Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A premium is an article of merchandise offered as an incentive to the user to take some action. The premium may act as an incentive to buy, to sample the product, to come into the retail store, or to stir interest so the user requests further information. 19. The three major categories of premiums are sales force premiums, consumer premiums, and dealer premiums. Answer: False Learning Objective: 06-03 Topic: Sales Promotion Generates Sales Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Contests and sweepstakes, consumer premiums, and dealer premiums are the three types of premiums. Premiums encourage customers to sample products and visit retail stores. 20. Price refers to the value of a product that attracts the buyer to exchange something of value for the product. Answer: True Learning Objective: 06-03 Topic: What’s It Worth? Pricing Your Product Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Price refers to the value or worth of a product that attracts the buyer to exchange money or something of value for the product. A product has some want-satisfying attributes for which the prospect is willing to exchange something of value.Chapter 06 - Sales Knowledge: Customers, Products, Technologies 6-7 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 21. Many companies offer customers various types of discounts, which are usually developed at the business unit level by the firm's product managers. Answer: False Learning Objective: 06-03 Topic: What’s It Worth? Pricing Your Product Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Many companies offer customers various types of discounts from normal prices to entice them to buy. These discounts are usually developed at the corporate level by the firm’s marketing managers. 22. One method to obtain information on competitors is through advertisements. Answer: True Learning Objective: 06-02 Topic: Know Your Competition, Industry, and Economy Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Advertisements provide useful information about competitors. A salesperson learns about the features and prices of competing products for the purpose of making comparisons. 23. Monitoring advertising and sales promotion activities enables salespeople to include current data and prices into sales presentations. Answer: True Learning Objective: 06-03 Topic: Advertising Aids Salespeople Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Keeping abreast of your company’s advertising and sales promotion activities is a must. By incorporating these data into your sales presentation, you can provide customers with a world of information that they probably know little about and that can secure the sale.Chapter 06 - Sales Knowledge: Customers, Products, Technologies 6-8 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 24. Salespeople should familiarize themselves with the company's price, discount, and credit policies so that they can use them as a competitive advantage. Answer: True Learning Objective: 06-03 Topic: What’s It Worth? Pricing Your Product Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Discount information becomes an important part of the sales presentation. It is important for salespeople to familiarize themselves with the company’s price, discount, and credit policies so that they can use them as a competitive advantage and enhance their professional image with the buyer. 25. The personal computer is a valuable tool for increasing a salesperson's productivity and improving customer relationships. Answer: True Learning Objective: 06-04 Topic: Personal Computers and Selling Blooms: Understand AACSB: Technology Level of Difficulty: Medium Explanation: Sales personnel find PCs a valuable tool for increasing productivity within the sales force. Computerization provides a permanent lead file, improves customer relations due to more effective follow-ups, and leads to greater productivity. 26. Personal computers improve the number and quality of sales calls. Answer: True Learning Objective: 06-04 Topic: Personal Computers and Selling Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: With a PC, a salesperson can make more sales calls and improve the quality of sales calls because of the availability of information. 27. Sales force automation addresses three broad areas of functionality: personal productivity, communications, and order processing and customer service. Answer: True Learning Objective: 06-04 Topic: Knowledge of Technology Enhances Sales and Customer Service Blooms: Remember AACSB: AnalyticChapter 06 - Sales Knowledge: Customers, Products, Technologies 6-9 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: Sales force automation enables firms to enhance a salesperson’s productivity, improve communications, and facilitate order processing and customer service. 28. A salesperson with contact management software has a map file for routing each day's schedule. Answer: False Learning Objective: 06-04 Topic: Knowledge of Technology Enhances Sales and Customer Service Blooms: Remember AACSB: Technology Level of Difficulty: Easy Explanation: Contact management software is a listing of all the customer contacts that a salesperson makes in the course of conducting business. This file is like an electronic Rolodex and should include such information as the contact’s name, title, company, address, phone number, fax number, and e-mail address. 29. Electronic calendar management can result in improved time management. Answer: True Learning Objective: 06-04 Topic: Knowledge of Technology Enhances Sales and Customer Service Blooms: Technology AACSB: Analytic Level of Difficulty: Easy Explanation: As a salesperson, the most vulnerable asset you have to manage is time. Electronic calendar management, as a part of sales force automation, can make time management easier and less prone to errors or oversights. 30. A personal digital assistant (PDA) is a worldwide radio-navigation system formed from a constellation of satellites circling the earth and their ground stations. Answer: False Learning Objective: 06-04 Topic: Knowledge of Technology Enhances Sales and Customer Service Blooms: Remember AACSB: Technology Level of Difficulty: Easy Explanation: The PDA is a tiny, fully functional computer that works as an extension of a desktop or laptop computer. The GPS is a worldwide radio-navigation system formed from a constellation of satellites circling the earth and their ground stations.Chapter 06 - Sales Knowledge: Customers, Products, Technologies 6-10 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 31. Salespeople who use a mobile office are not as efficient as those who work out of a stable office. Answer: False Learning Objective: 06-04 Topic: Knowledge of Technology Enhances Sales and Customer Service Blooms: Remember AACSB: Technology Level of Difficulty: Easy Explanation: In their mobile offices, salespeople can stay in constant contact with their customers even when driving between cities or states. In some ways, a mobile office offers more efficiency than a typical office situation. 32. In sales, the need for netiquette mostly arises when using text messaging. Answer: False Learning Objective: 06-04 Topic: Technology Etiquette Blooms: Understand AACSB: Technology Level of Difficulty: Medium Explanation: Netiquette is the term used for etiquette on the Internet. In sales, the need for netiquette mostly arises when sending or distributing e-mail. 33. The rules of netiquette encourage the use of all capital letters in e-mails that need to be communicated quickly. Answer: False Learning Objective: 06-04 Topic: Technology Etiquette Blooms: Understand AACSB: Technology Level of Difficulty: Medium Explanation: Using all capital letters in an e-mail is the equivalent of shouting at the receiver, so normal capitalization rules should be followed. 34. When leaving a voice message, avoid stating your name or phone number more than once to save storage space on the user’s voice mail system. Answer: False Learning Objective: 06-04 Topic: Technology Etiquette Blooms: Understand AACSB: Technology Level of Difficulty: Medium Explanation: It is important to be courteous when leaving a voice message for someone else. You should say your name and phone number slowly at the beginning and ending of the message. This keeps the recipient from having to replay your message.Chapter 06 - Sales Knowledge: Customers, Products, Technologies 6-11 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 35. In office settings, a salesperson should not use speakerphones unless it is required for a meeting. Answer: True Learning Objective: 06-04 Topic: Technology Etiquette Blooms: Understand AACSB: Technology Level of Difficulty: Medium Explanation: It may be necessary to conduct a meeting over the telephone through a conference call. This should be the only reason a salesperson uses a speakerphone in an office setting. This prevents private information from being heard. Multiple Choice Questions 36. Salespeople need to have selling knowledge for all of the following reasons EXCEPT: A. increasing sales. B. building relationships with their customers. C. increasing the individual salesperson's self-confidence. D. building the buyer's confidence in the individual salesperson. E. increasing cognitive dissonance among customers and competitors. Answer: E Learning Objective: 06-01 Topic: Knowledge Builds Relationships Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Salespeople today must be knowledgeable to increase the salesperson’s selfconfidence, to build the buyer’s confidence in the salesperson, and to build relationships through truly caring about the needs of others. Knowledge is also necessary to build sales. 37. Which term refers to an employer’s effort to provide the opportunity for salespeople to learn about the job-related skills, knowledge, and attitudes that lead to sales success? A. Negotiation training B. Sales training C. Market positioning D. Contact management E. Job development Answer: B Learning Objective: 06-01 Topic: Sources of Sales Knowledge Blooms: Remember AACSB: AnalyticChapter 06 - Sales Knowledge: Customers, Products, Technologies 6-12 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: Sales training is the effort an employer puts forth to provide the opportunity for the salesperson to receive job-related culture, skills, knowledge, and attitudes that result in improved performance in the selling environment. 38. Which of the following statements about sales training is most likely true? A. Sales training ends when the salesperson actually begins the selling job. B. An understanding of sales training is only gained through the company's formal training program. C. Sales training is irrelevant once a salesperson receives the designation of "master sales representative." D. Sales knowledge gained from sales training benefits not only the salesperson and the company but also the customer. E. Periodic sales training is intended to keep salespeople humble and aware of their shortcomings. Answer: D Learning Objective: 06-01 Topic: Sources of Sales Knowledge Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Successful companies thoroughly train new salespeople and maintain ongoing training programs for their experienced sales personnel. Companies are interested in training primarily to increase sales volume, salesperson productivity, and profitability, and training is beneficial to all parties in a sales transaction. 39. A salesperson selling ________ to ________ would most likely need the most extensive product and company knowledge. A. skis; consumers B. jewelry; retailers C. televisions; consumers D. computers; small businesses E. rocket components; engineers Answer: E Learning Objective: 05-03 Topic: Know Your Company Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: In general, consumer-goods salespeople require less information about the technical nature of their products; however, selling high-technology products to highly knowledgeable industrial buyers requires extensive knowledge.Chapter 06 - Sales Knowledge: Customers, Products, Technologies 6-13 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 40. According to the text, salespeople need to have sales knowledge to: A. comply with state and federal Green River Ordinances. B. build the buyer's confidence in the salesperson. C. eliminate inequities in sales experience. D. more efficiently manage inventory. E. win their employers' confidence. Answer: B Learning Objective: 06-01 Topic: Knowledge Builds Relationships Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Salespeople today must be knowledgeable to increase the salesperson’s selfconfidence, to build the buyer’s confidence in the salesperson, and to build relationships through truly caring about the needs of others. 41. Which of the following pieces of information would be LEAST important for a salesperson to know about the product she sells? A. How the product performs B. How the product is selling in the market C. Specific features and benefits of the product D. Physical size and characteristics of the product E. Steps and safety precautions required to make the product Answer: E Learning Objective: 06-02 Topic: Know Your Product Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Salespeople need to be experts about the products they sell, which includes knowing performance and sales data as well as features and benefits. It is less important to know how a product is made. 42. Which information is the LEAST important for a salesperson to know about a channel member that sells the same products as the salesperson's employer? A. Distribution policies B. Product lines carried C. Pricing policies D. Purchase history E. Inventory methods Answer: E Learning Objective: 06-02 Topic: Know Your Resellers Blooms: Understand AACSB: AnalyticChapter 06 - Sales Knowledge: Customers, Products, Technologies 6-14 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: Salespeople should know the distribution and pricing policies of each channel member as well as the product lines carried. Information about past purchases would also be useful but inventory methods is less relevant. 43. Why do some businesses require that new salespeople work on the company’s assembly line? A. Develop empathy B. Gain product knowledge C. Analyze channel distribution D. Monitor customer service facilities E. Form relationships with co-workers Answer: B Learning Objective: 06-02 Topic: Know Your Product Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Many companies have their new salespeople work in the manufacturing plant or in the warehouse. This hands-on experience provides extensive product knowledge and may help in future selling. 44. _____ advertising is designed to reach all users of the products whether consumers or industrial buyers. A. Direct-mail B. Industrial C. Trade D. National E. Retail Answer: D Learning Objective: 06-03 Topic: Advertising Aids Salespeople Blooms: Remember AACSB: AnalyticChapter 06 - Sales Knowledge: Customers, Products, Technologies 6-15 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: National advertising is advertising designed to reach all users of the product, whether consumers or industrial buyers. These ads are shown across the country. 45. Dell Computers wants to reach all potential users of their products, both industrial buyers and final consumers. They would most likely use _____ advertising because it has the greatest reach. A. trade B. national C. industrial D. retail E. cooperative Answer: B Learning Objective: 06-03 Topic: Advertising Aids Salespeople Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: National advertising is advertising designed to reach all users of the product, whether consumers or industrial buyers. These ads are shown across the country. 46. Local supermarkets and department stores regularly advertise nationally distributed brand products. Which of the following advertisement types are they most likely to use? A. Retail advertising B. National advertising C. Cooperative advertising D. Trade advertising E. Industrial advertising Answer: A Learning Objective: 06-03 Topic: Advertising Aids Salespeople Blooms: Remember AACSB: Analytic Level of Difficulty: EasyChapter 06 - Sales Knowledge: Customers, Products, Technologies 6-16 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Retail advertising is used by a retailer to reach customers within its geographic trading area. Local supermarkets and department stores regularly advertise nationally distributed brand products. 47. An advertisement in a local newspaper for a locally-owned shoe store is an example of _____ advertising. A. industrial B. national C. trade D. retail E. co-op Answer: D Learning Objective: 06-03 Topic: Advertising Aids Salespeople Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Retail advertising is used by a retailer to reach customers within its geographic trading area. Trade ads are aimed at wholesalers. 48. Which of the following would most likely include a trial sample or request consumers to complete a questionnaire to receive a free product sample? A. Trade advertising B. Industrial advertising C. Cooperative advertising D. Retail advertising E. Direct-mail advertising Answer: E Learning Objective: 06-03 Topic: Advertising Aids Salespeople Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Direct-mail advertising is mailed directly to the consumer or industrial user; it is an effective method of exposing these users to a product or it reminds them that the product is available to meet a specific need. Often, trial samples or coupons accompany direct-mail advertising.Chapter 06 - Sales Knowledge: Customers, Products, Technologies 6-17 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 49. A veterinarian ran a local newspaper advertisement announcing it was the exclusive distributor of Hill brand gourmet pet food. The Hill salesperson reimbursed the veterinarian for the media cost. This is most likely an example of _____ advertising. A. industrial B. national C. trade D. dual E. co-op Answer: E Learning Objective: 06-03 Topic: Advertising Aids Salespeople Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Cooperative, or co-op, advertising is advertising the retailer conducts with the cost paid for by the manufacturer or shared by the manufacturer and retailer. Industrial ads are aimed at groups that purchase products for manufacturing. 50. Smith-Lockwood, a gift store, ran a half-page newspaper advertisement for Howard Miller brand clocks. Smith-Lockwood's Howard Miller supplier reimbursed the store's owner for the media cost. What type of advertising has most likely been used? A. Industrial B. National C. Trade D. Institutional E. Co-op Answer: E Learning Objective: 06-03 Topic: Advertising Aids Salespeople Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Cooperative, or co-op, advertising is advertising the retailer conducts with the cost paid for by the manufacturer or shared by the manufacturer and retailer. Industrial ads are aimed at groups that purchase products for manufacturing.Chapter 06 - Sales Knowledge: Customers, Products, Technologies 6-18 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 51. Advertising developed and paid for by manufacturers and directed toward wholesalers is most likely _____ advertising. A. industrial B. national C. trade D. retail E. co-op Answer: C Learning Objective: 06-03 Topic: Advertising Aids Salespeople Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Trade advertising is undertaken by the manufacturer and directed toward the wholesaler or retailer. Such advertisements appear in trade magazines serving only the wholesaler or retailer. 52. When the manufacturer of Western Riding Saddles advertises in a publication that is distributed only to operators of riding schools, it is an example of _____ advertising. A. industrial B. national C. retail D. trade E. pioneering Answer: D Learning Objective: 06-03 Topic: Advertising Aids Salespeople Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Trade advertising is undertaken by the manufacturer and directed toward the wholesaler or retailer. Such advertisements appear in trade publications serving only the wholesaler or retailer. 53. Advertising directed toward individuals who purchase products for use in manufacturing other products is called _____ advertising. A. industrial B. national C. trade D. manufacturers' E. installation Answer: A Learning Objective: 06-03 Topic: Advertising Aids Salespeople Blooms: RememberChapter 06 - Sales Knowledge: Customers, Products, Technologies 6-19 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Easy Explanation: Industrial advertising is aimed at individuals and organizations that purchase products used in manufacturing other products. General Electric may advertise small electric motors in magazines read by buyers employed by firms such as Whirlpool or Sears. 54. An advertisement for Carr Cabinet Doors that is directed to people in the woodworking industry ran in a publication called Custom Woodworking Business. The ad explained why Carr Cabinet Doors were the perfect finishing touch for any kind of cabinets. This manufacturer used _____ advertising to reach potential users of its doors. A. national B. industrial C. cooperative D. retail E. institutional Answer: B Learning Objective: 06-03 Topic: Advertising Aids Salespeople Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Industrial advertising is aimed at individuals and organizations that purchase products used in manufacturing other products. Carr is trying to sell its doors to people in the woodworking industry. 55. Companies advertise their products for all of the following reasons EXCEPT to: A. increase intermediary cooperation. B. educate potential customers about products. C. reduce buyers' cognitive dissonance about a purchase. D. develop leads for salespeople through mail-ins. E. presell products even before a salesperson's call. Answer: E Learning Objective: 06-03 Topic: Advertising Aids Salespeople Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 06 - Sales Knowledge: Customers, Products, Technologies 6-20 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Firms advertise to build cooperation with channel members, educate customers about products, reduce post-purchase cognitive dissonance, and develop leads. Ads may help create sales between a salesperson’s calls but not before. 56. Sheila Dunn is the author of a children's book. A retail bookstore chain has agreed to advertise Sheila’s book aggressively with lots of countertop literature racks, posters, banners, and life-size images of the characters from her book. All of these are examples of: A. trade sales promotion efforts. B. point-of-purchase displays. C. shelf positioning tools. D. shelf facing tactics. E. retailer premiums. Answer: B Learning Objective: 06-03 Topic: Sales Promotion Generates Sales Blooms: Understand AACSB: Sales Promotion Generates Sales Level of Difficulty: Medium Explanation: Point-of-purchase (POP) displays allow a product to be seen easily and purchased. A product POP display may include photographs, banners, drawings, counter displays, or floor stands. 57. Which of the following is an example of a consumer sales promotion? A. Special purchase prices B. Displays C. Dealer loader D. Retail coupons E. Trade discounts Answer: D Learning Objective: 06-03 Topic: Sales Promotion Generates Sales Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Consumer sales promotion includes free samples, consumer contests, coupons, and demonstrations to consumers. Trade sales promotion encourages resellers to purchase and aggressively sell a manufacturer’s products by offering incentives like sales contests, displays, special purchase prices, and free merchandise.Chapter 06 - Sales Knowledge: Customers, Products, Technologies 6-21 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 58. Which of the following is primarily a trade sales promotion? A. Free samples B. Consumer demonstrations C. Store coupons D. Sweepstakes E. Special purchase prices Answer: E Learning Objective: 06-03 Topic: Sales Promotion Generates Sales Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Trade sales promotion encourages resellers to purchase and aggressively sell a manufacturer’s products by offering incentives like sales contests, displays, special purchase prices, and free merchandise. Consumer sales promotion includes free samples, contests, coupons, and demonstrations to consumers. 59. A POP display would most likely be used by a retailer to: A. facilitate the SELL sequence in a sales presentation. B. develop long-term customer relationships. C. meet environmental requirements. D. attract customer attention. E. expand shelf space. Answer: B Learning Objective: 06-03 Topic: Sales Promotion Generates Sales Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Point-of-purchase displays allow a product to be seen easily and purchased. They catch the customer’s attention and make products easy to purchase, which results in increased product sales. 60. _____ refers to the physical placement of the product within the retail store. A. Inventory management B. Shelf positioning C. Suggestion selling D. Shelf facing E. Stock locating Answer: B Learning Objective: 06-03 Topic: Sales Promotion Generates Sales Blooms: Remember AACSB: AnalyticChapter 06 - Sales Knowledge: Customers, Products, Technologies 6-22 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: Shelf positioning refers to the physical placement of the product within the retailer’s store. Shelf facings are the number of individual products placed beside each other on the shelf. 61. Shelf facings are defined as the: A. number of products of a particular manufacturer in a retail outlet. B. number of individual POP displays placed within a retail store. C. physical placement of the product within the retail store. D. total number of products in a retail outlet. E. number of individual products placed beside each other on a retailer's shelf. Answer: E Learning Objective: 06-03 Topic: Sales Promotion Generates Sales Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Shelf facings are the number of individual products placed beside each other on the shelf. Shelf positioning refers to the physical placement of the product within the retailer’s store. 62. The major obstacle a salesperson faces when trying to get retailers to place new products on store shelves is: A. retailers' resistance to change. B. unclear product categories. C. negative publicity. D. poor self-regulation. E. limited shelf space. Answer: E Learning Objective: 06-03 Topic: Sales Promotion Generates Sales Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The major obstacle faced when attempting to obtain shelf space for products is limited space. A retail store has a fixed amount of display space and thousands of products to stock. You compete for shelf space with other salespeople and with the retailer’s brands.Chapter 06 - Sales Knowledge: Customers, Products, Technologies 6-23 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 63. A(n) _____ is an article of merchandise offered as an incentive to the user to take some action. A. premium B. POP display C. earned discount D. value adding product E. quantity discount allowance Answer: A Learning Objective: 06-03 Topic: Sales Promotion Generates Sales Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A premium is an article of merchandise offered as an incentive to the user to take some action. The premium may act as an incentive to buy, to sample the product, to come into the retail store, or to stir interest so the user requests further information. 64. Manufacturers are LEAST likely to use premiums for: A. getting prospects to request further information. B. boosting the future sales of fast moving products. C. getting customers to come into the retail store. D. persuading prospects to sample the product. E. introducing a new product. Answer: B Learning Objective: 06-03 Topic: Sales Promotion Generates Sales Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A premium may act as an incentive to buy, to sample the product, to come into the retail store, or to stir interest so the user requests further information. Premiums serve a number of purposes: to promote consumer sampling of a new product, to introduce a new product, to encourage point-of-purchase displays, and to boost sales of slow products.Chapter 06 - Sales Knowledge: Customers, Products, Technologies 6-24 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 65. Which term refers to the value or worth of a product that attracts the buyer to exchange money or something of value for the product? A. Price B. Promotion C. Depreciation D. Premium E. Gross margin Answer: A Learning Objective: 06-03 Topic: What’s It Worth? Pricing Your Product Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Price refers to the value or worth of a product that attracts the buyer to exchange money or something of value for the product. A product has some want-satisfying attributes for which the prospect is willing to exchange something of value. 66. Discounts on prices are usually determined by the firm's ____. A. chief executive officer B. marketing managers C. channel partners D. salespeople E. distributors Answer: B Learning Objective: 06-03 Topic: What’s It Worth? Pricing Your Product Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Many companies offer customers various types of discounts from normal prices to entice them to buy. These discounts are usually developed at the corporate level by the firm’s marketing managers. 67. Terrence sells office equipment and is asked by a prospect, "How does your product compare to the one I’m currently using?" To prepare for this question, Terrence should have: A. planned a trial close. B. examined the competition's ads. C. checked his firm's code of ethics. D. practiced question-avoidance techniques. E. talked to former employees of his competitors. Answer: B Learning Objective: 06-03 Topic: Know Your Competition, Industry, and Economy Blooms: UnderstandChapter 06 - Sales Knowledge: Customers, Products, Technologies 6-25 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Medium Explanation: A salesperson needs to be prepared to discuss product features, advantages, and benefits in comparison to other products and confidently show why the salesperson’s product will fulfill the buyer’s needs better than competing products. One method to obtain information on competitors is through advertisements. 68. To make the most efficient use of computers as sales tools, salespeople should use their personal computers to: A. play challenging games. B. make additional cold calls. C. help them avoid poor closings. D. improve their personal productivity. E. create personal blogs about selling. Answer: D Learning Objective: 06-04 Topic: Personal Computers and Selling Blooms: Remember AACSB: Technology Level of Difficulty: Easy Explanation: Computers enable salespeople to be more productive on the job. A computer helps salespeople manage sales leads and create customer files. 69. Which of the following provides a list of all the customers a salesperson meets in the course of conducting business? A. Contact management software B. Sales force automation system C. Electronic mail system D. Worksheet information system E. Global positioning system Answer: A Learning Objective: 06-04 Topic: Knowledge of Technology Enhances Sales and Customer Service Blooms: Remember AACSB: Technology Level of Difficulty: Easy Explanation: Contact management software is a listing of all the customer contacts that a salesperson makes in the course of conducting business.Chapter 06 - Sales Knowledge: Customers, Products, Technologies 6-26 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 70. Todd, a sales representative for a textbook publisher, knows the name and direct line of each client’s administrative assistant. Which type of software most likely helps Todd keep track of this information? A. GIS B. POP C. Inventory management D. Contact management E. Calendar management Answer: D Learning Objective: 06-04 Topic: Knowledge of Technology Enhances Sales and Customer Service Blooms: Remember AACSB: Technology Level of Difficulty: Easy Explanation: Contact management software is a listing of all the customer contacts that a salesperson makes in the course of conducting business. Todd can add the names and numbers of each customer’s assistant, which will be beneficial for making sales calls. 71. Which of the following is NOT a feature associated with electronic calendar management? A. Links scheduled events with accounts B. Assigns relative priorities to items listed C. Automatically checks for scheduling conflicts D. Reduces time management errors E. Includes product order history Answer: E Learning Objective: 06-04 Topic: Knowledge of Technology Enhances Sales and Customer Service Blooms: Understand AACSB: Technology Level of Difficulty: Medium Explanation: Order information would most likely be included in a contact management program. Electronic calendars can link events with contact information, prioritize events, and ensure that scheduling conflicts do not occur. 72. Which of the following would most likely remind a salesperson to send a thank-you letter to a sales prospect? A. Geographic information system B. Electronic Rolodex C. Sales force automation system D. Demographic information system E. Global positioning system Answer: C Learning Objective: 06-04Chapter 06 - Sales Knowledge: Customers, Products, Technologies 6-27 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Topic: Knowledge of Technology Enhances Sales and Customer Service Blooms: Understand AACSB: Technology Level of Difficulty: Medium Explanation: A sales force automation system begins working as soon as the initial meeting is entered into the system. A few simple commands tell it to remind you to send a thank-you letter and schedule a follow-up phone call. 73. A salesperson who used a(n) _____ would be able to track customer buying patterns. A. hashtag B. computerized atlas C. management information system D. shared worksheet platform E. geographic information system Answer: E Learning Objective: 06-04 Topic: Knowledge of Technology Enhances Sales and Customer Service Blooms: Remember AACSB: Technology Level of Difficulty: Easy Explanation: A geographic information system (GIS) allows salespeople to view and manipulate customer and/or prospect information on an electronic map. A GIS can also reveal customer buying patterns that otherwise may not be apparent. 74. Which of the following would most likely be used by a salesperson to make a sales presentation that includes product video clips? A. Outlook B. Windows C. Excel D. PowerPoint E. Internet Explorer Answer: D Learning Objective: 06-04 Topic: Knowledge of Technology Enhances Sales and Customer Service Blooms: Remember AACSB: Technology Level of Difficulty: Easy Explanation: Computer-based presentations can be a powerful presentation tool. PowerPoint presentations with short product video clips provide a means of creating a customized dynamic video and sound discussion of the product.Chapter 06 - Sales Knowledge: Customers, Products, Technologies 6-28 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 75. Salespeople use geographic information systems to: A. increase their sales quotas. B. acquire instant knowledge. C. create more efficient routing patterns. D. send text messages to customers and prospects E. stay in constant contact with their sales managers. Answer: C Learning Objective: 06-04 Topic: Knowledge of Technology Enhances Sales and Customer Service Blooms: Remember AACSB: Technology Level of Difficulty: Easy Explanation: A geographic information system allows salespeople to view and manipulate customer and/or prospect information on an electronic map. Salespeople can plan sales calls geographically and efficiently. 76. A salesperson would most likely use an iPod to: A. develop product knowledge and selling skills. B. search the Internet for a competitor’s product data. C. integrate video clips into PowerPoint presentations. D. organize client contact information. E. schedule customer meetings. Answer: A Learning Objective: 06-04 Topic: Knowledge of Technology Enhances Sales and Customer Service Blooms: Understand AACSB: Technology Level of Difficulty: Medium Explanation: Podcasts on an iPod are an excellent way to train salespeople on product knowledge and selling skills. They can provide coaching and practical advice at a moment’s notice. 77. Which of the following is a fully functional computer that works as an extension of a salesperson’s personal computer? A. MP3 B. POS C. GPS D. PDa E. GIS Answer: D Learning Objective: 06-04 Topic: Knowledge of Technology Enhances Sales and Customer Service Blooms: Remember AACSB: TechnologyChapter 06 - Sales Knowledge: Customers, Products, Technologies 6-29 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: The PDA, or personal digital assistant, is a tiny, fully functional computer that works as an extension of a desktop or laptop computer. 78. The Internet is best described as a: A. worldwide radio-navigation system. B. global positioning system. C. global network of computers. D. global network of satellites. E. geographic information system. Answer: C Learning Objective: 06-04 Topic: Sales: Internet and the World Wide Web Blooms: Understand AACSB: Technology Level of Difficulty: Medium Explanation: The Internet, often referred to as the Net, is a global network of computers. Similar in some ways to the telephone system, it reaches every country in the world. 79. Surfing the Internet primarily refers to: A. exploring sites found on the Web. B. creating links between Web sites. C. participating in online chat rooms. D. accessing the Internet on a PDA. E. purchasing a license for Internet access. Answer: A Learning Objective: 06-04 Topic: Sales: Internet and the World Wide Web Blooms: Remember AACSB: Technology Level of Difficulty: Easy Explanation: Surfing the Internet is actually exploring the different sites found on the World Wide Web. Links are what give the Web its name, and all of the links together form a web of information that spans the globe. 80. A car salesperson was selling a used car to Larry Travis when Larry said, "I really like this car, but I am not going to buy any car without knowing its history." The salesperson went to his computer, visited a Website called Car Fax and handed Travis a printout of the car's history. This incident best exemplifies how: A. point-of-purchase displays attract attention. B. technological changes have enhanced sales. C. transactional selling methods are utilized. D. long-term partnering relationships are formed. E. contact management software benefits salespeople. Answer: BChapter 06 - Sales Knowledge: Customers, Products, Technologies 6-30 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Learning Objective: 06-04 Topic: Global Technology Provides Service Blooms: Understand AACSB: Technology Level of Difficulty: Medium Explanation: Accessing information quickly can enhance sales. In this case, technology solved a sales problem and built the customer’s confidence in the salesperson and the product. 81. When communicating via e-mail messages, a salesperson should never: A. use friendly closings. B. write concisely. C. use salutations. D. use all capital letters. E. include subject headings. Answer: D Learning Objective: 06-04 Topic: Technology Etiquette Blooms: Understand AACSB: Technology Level of Difficulty: Medium Explanation: Brief messages that include friendly closings, salutations, and subject headings are considered appropriate. However, using all capital letters is equivalent to shouting. 82. Which of the following is an appropriate guideline to follow when communicating with a cell phone? A. Remember the person you are with should be the most important person for you to be communicating with B. Speak louder into a cell phone than you would in other types of phones C. Never ignore a cell phone call D. Avoid text messaging in public areas E. Always keep your phone in message mode Answer: A Learning Objective: 06-04 Topic: Technology Etiquette Blooms: Understand AACSB: Technology Level of Difficulty: Medium Explanation: Courteous salespeople focus on the people in front of them rather than the one on the telephone. If you are expecting important information from a colleague but need to be in a public area, switch your phone to message mode and ask them to send a text message to your phone.Chapter 06 - Sales Knowledge: Customers, Products, Technologies 6-31 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 83. The right time for a salesperson to use a speakerphone in an office setting is when he or she is: A. inputting data into a computer. B. participating in a conference call. C. part of a regional sales team. D. talking to someone in an office. E. talking to a key customer. Answer: B Learning Objective: 06-04 Topic: Technology Etiquette Blooms: Understand AACSB: Technology Level of Difficulty: Medium Explanation: It may be necessary to conduct a meeting over the telephone through a conference call. This should be the only reason a salesperson uses a speakerphone in an office setting. This prevents private information from being heard. 84. _____ is the standard amount charged to customers for a product. A. List price B. Transactional value C. Cost D. Contribution margin E. Net worth Answer: A Learning Objective: 06-02 Topic: Appendix: Types of Prices Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: List price is the standard price that is charged to customers. Net price is the price charged after discount allowances. 85. Posh Pets is a small retailer of decorative pet-related merchandise. The price charged by its suppliers after allowance for all discounts is the _____ price. A. discretionary B. zone C. list D. net E. marginal Answer: D Learning Objective: 06-02 Topic: App: Types of Prices Blooms: Understand AACSB: Appendix: Types of PricesChapter 06 - Sales Knowledge: Customers, Products, Technologies 6-32 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: Net price is the price charged after discount allowances. List price is the standard price that is charged to customers. 86. A manufacturer that bases its charge to customers on the customer’s location or the customer’s distance from the shipping point is using a(n) _____ price. A. geographic B. zone C. FOB destination D. net E. FOB shipping point Answer: B Learning Objective: 06-02 Topic: Appendix: Types of Prices Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Zone price is the price of a product based on the geographic location or zone of the customer. List price is the standard price that is charged to customers. Net price is the price charged after discount allowances. 87. A product is priced "FOB destination." This expression means: A. the shipping costs are negotiable. B. the buyer pays the shipping costs. C. the seller pays all shipping costs. D. the buyer and seller share the shipping costs. E. freight over a basic fee is paid at the destination. Answer: C Learning Objective: 06-02 Topic: Appendix: Types of Prices Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: FOB (free on board) destination means that the seller pays all shipping costs. With FOB shipping point, the buyer pays transportation charges on the goods. 88. Which of the following is a quantity discount that involves a one-time reduction in price? A. Cash discount B. Noncumulative quantity discount C. Trade discount D. Cumulative quantity discount E. Consumer discount Answer: B Learning Objective: 06-02 Topic: Appendix: Discounts Lower the PriceChapter 06 - Sales Knowledge: Customers, Products, Technologies 6-33 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A one-time price reduction is a noncumulative quantity discount. Cumulative quantity discounts are discounts the customer receives for buying a certain amount of a product over a stated period, such as one year. 89. If one case of Winston brand chocolate molds costs $10.00, but a single order for 10 cases costs a total of $94.00, it is most accurate to say that: A. the manufacturer's finance department made an error. B. the manufacturer offers a cash discount. C. the manufacturer offers a cumulative quantity discount. D. the manufacturer offers a noncumulative quantity discount. E. the manufacturer offers a trade discount. Answer: D Learning Objective: 06-02 Topic: Appendix: Discounts Lower the Price Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: A one-time price reduction, such as 10 cases for $94, is a noncumulative quantity discount. Cumulative quantity discounts are discounts the customer receives for buying a certain amount of a product over a stated period, such as one year. 90. Knight's Catering Service receives a May 19th invoice for $150 with terms of 3/10 net 30. If Knight’s pays the invoice on May 28, how much is due? A. $120.00 B. $145.50 C. $147.00 D. $150.00 E. $153.00 Answer: B Learning Objective: 06-02 Topic: Appendix: Discounts Lower the Price Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: Customers who pay bills within a set period of time may earn cash discounts. Knight’s saves $4.50 by paying within 10 days ($150 x 3% = $4.50).Chapter 06 - Sales Knowledge: Customers, Products, Technologies 6-34 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Essay Questions 91. How does the salesperson obtain the knowledge needed for selling? Answer: The knowledge for selling can be obtained in two ways. The first way is where the company provides some formal sales training that teaches information through preliminary sales program and sales meeting. The second way is where the salesperson learns by being on the job. Learning Objective: 06-01 Topic: Sources of Sales Knowledge Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 92. What is sales training? How long is the training period for a typical salesperson? Answer: Sales training is the effort an employer puts forth to provide the opportunity for the salesperson to receive job-related culture, skills, knowledge, and attitudes that result in improved performance in the selling environment. It is an ongoing process that should continue throughout a salesperson's career. Learning Objective: 06-01 Topic: Sources of Sales Knowledge Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 93. Why is knowledge about their company, buyer, and market important to salespeople? Answer: The three important reasons for a salesperson to have sales knowledge are to: (1) increase self-confidence, (2) build the buyer's confidence, and (3) build relationships. Learning Objective: 06-01 Topic: Knowledge Builds Relationships Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 94. How does a mobile office benefit a salesperson? Answer: In a mobile office salespeople can stay in constant contact with their customers even when driving between cities and states. When salespeople arrive at a prospect's office and the prospect cannot see them immediately, those with a mobile office can go outside to work until they are ready to be seen. The mobile office reduces wasted time. Learning Objective: 06-04 Topic: Knowledge of Technology Enhances Sales and Customer Service Blooms: Understand AACSB: Technology Level of Difficulty: MediumChapter 06 - Sales Knowledge: Customers, Products, Technologies 6-35 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 95. What aspects should you know about your product? How can you develop such knowledge? Answer: Product knowledge includes details such as performance data, physical size, and characteristics, how the product operates, special features, advantages and benefits, and how well the product is selling in the marketplace. Working in the manufacturing plan or warehouse helps develop product knowledge. Attending company sales meetings is also beneficial. Learning Objective: 06-02 Topic: Know Your Product Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 96. What sort of knowledge should you have about your resellers? Answer: Some important information you should have about your resellers is as follows: likes and dislikes of each channel member's customers; product lines and assortment each carries; time when each member sees salespeople; distribution, promotion and pricing policies; quantity of products each channel member has purchased in the past. Learning Objective: 06-02 Topic: Know Your Resellers Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 97. List and explain the six basic types of advertising programs that a company can use. Answer: The six basic types of advertising programs that a company can use are: (1) National advertising, (2) Retail advertising, (3) Cooperative advertising, (4) Trade advertising, (5) Industrial advertising and (6) Direct-mail advertising.  National advertising is designed to reach all users of the product, whether consumers or industrial buyers.  Retail advertising is used by a retailer to reach customers within its geographic trading area.  Cooperative advertising is conducted by the retailer with the cost paid for by the manufacturer.  Trade advertising is undertaken by the manufacturer and is directed towards the wholesaler or retailer.  Industrial advertising is aimed at individuals and organizations that purchase products used in manufacturing other products.  Direct-mail advertising an effective method of exposing the consumers or industrial users to a product as it reminds them that the product is available to meet a specific need. Learning Objective: 06-02 Topic: Advertising Aids Salespeople Blooms: Understand AACSB: AnalyticChapter 06 - Sales Knowledge: Customers, Products, Technologies 6-36 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium 98. Distinguish between shelf positioning and shelf facings. Answer: Shelf positioning refers to the physical placement of the product within the retailer's store. Whereas, shelf facings are the number of individual products placed beside each other on the shelf. Learning Objective: 06-03 Topic: Sales Promotion Generates Sales Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 99. How can a geographic information system make a salesperson more efficient? Answer: A geographic information system (GIS) allows a salesperson to view and manipulate customer and/or prospect information on an electronic map. This is extremely useful when he visits an area for the first time. It allows him to access and sort customer information directly from the contact-management data, plan sales calls geographically, and make the most efficient use of his time. Learning Objective: 06-04 Topic: Knowledge of Technology Enhances Sales and Customer Service Blooms: Understand AACSB: Technology Level of Difficulty: Medium 100. Briefly distinguish between the Internet and the World Wide Web. Answer: The Internet is a global network of computers. It is a worldwide, self-governed network connecting thousands of smaller networks, and millions of computers and people to megasources of information. Whereas, the World Wide Web is a part of the internet that houses ‘web sites' that provide texts, graphics, videos, and audio information on millions of topics. Learning Objective: 06-04 Topic: Sales: Internet and the World Wide Web Blooms: Understand AACSB: Technology Level of Difficulty: MediumChapter 07 - Prospecting – The Lifeblood of Selling 7-1 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Chapter 07 Prospecting – The Lifeblood of Selling Learning Objectives: 07-01 Define the sales process, and list and describe its 10 steps in the correct sequence. 07-02 State why it is important to prospect. 07-03 Describe the various prospecting methods. 07-04 Ask for a referral anywhere during the referral cycle. 07-05 Make an appointment with a prospect or customer in person or by telephone. True / False Questions 1. The sales process refers to a sequential series of actions by the salesperson that leads toward the customer taking a desired action and ends with a follow-up to ensure purchase satisfaction. Answer: True Learning Objective: 07-01 Topic: The Sales Process Has 10 Steps Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The sales process refers to a sequential series of actions by the salesperson that leads toward the prospect or customer taking a desired action and ends with a follow-up to ensure purchase satisfaction. This selling process involves 10 basic steps. 2. A guideline provided in the text states that a good sales process involves 40 percent followup, 20 percent preparation, and 40 percent presentation. Answer: False Learning Objective: 07-01 Topic: Steps before the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: One rule of thumb states that a good sales process involves 20 percent presentation, 40 percent preparation, and 40 percent follow-up, especially when selling large accounts.Chapter 07 - Prospecting – The Lifeblood of Selling 7-2 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 3. Success in selling requires minimal preparation before sales calls but a significant degree of work during calls. Answer: False Learning Objective: 07-01 Topic: Steps before the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: As in most professions, success in selling often requires as much or more preparation before and between calls than is involved in actually making the calls themselves. 4. Preapproach is the first step in the selling process. Answer: False Learning Objective: 07-01 Topic: The Sales Process Has 10 Steps Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Prospecting is the first step in the selling process. Preapproach and planning are components of the second step of the process. 5. The two reasons a salesperson must consistently look for new prospects are to increase sales and to replace customers that will be lost over time. Answer: True Learning Objective: 07-02 Topic: Prospecting—The Lifeblood of Selling Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Prospecting is ongoing because salespeople lose some customers over time, and these need to be replaced. Prospecting is also necessary to increase sales. 6. A prospect is a qualified business that has the potential to buy a salesperson’s product. Answer: True Learning Objective: 07-02 Topic: Prospecting—The Lifeblood of Selling Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A prospect is a qualified person or organization that has the potential to buy your good or service. Prospecting is an ongoing practice for most salespeople.Chapter 07 - Prospecting – The Lifeblood of Selling 7-3 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 7. "MAD" in prospecting is money, authority, and determination. Answer: False Learning Objective: 07-02 Topic: Prospecting—The Lifeblood of Selling Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: MAD in prospecting refers to money, authority, and desire. A salesperson needs to determine if an individual or organization is a qualified prospect which means they have the money, authority, and desire to buy. 8. The Leaking Bucket Customer concept illustrates how all leads and prospects are considered and filtered out before they become qualified prospects. Answer: False Learning Objective: 07-02 Topic: The Leaking Bucket Customer Concept Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The Leaking Bucket Customer Concept illustrates how new customers come into the top and leave through a hole in the bottom of the bucket. It is always easier to sell to a satisfied customer than an unsatisfied one or a prospect. The cost of acquiring a new customer is higher than keeping a present customer. 9. The salesperson who uses the cold canvass method of prospecting usually knows something about the prospect. Answer: False Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The cold canvass prospecting method is based on the law of averages and relies solely on the volume of cold calls made. There is generally no knowledge about the individual or business the salesperson calls on.Chapter 07 - Prospecting – The Lifeblood of Selling 7-4 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 10. The success of cold canvass prospecting method relies solely on volume of calls made. Answer: True Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The cold canvass prospecting method is based on the law of averages and relies solely on the volume of cold calls made. There is generally no knowledge about the individual or business the salesperson calls on. 11. In the two years Keith has been selling, he has built up a list of inactive accounts. He should now orphan these accounts and try to develop new prospects. Answer: False Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Orphaned customers are customers whose salesperson has left the company. Salespeople often leave their employers to take other jobs; when they do, their customers are orphaned. These orphans are great prospects. Keith should quickly contact such customers to begin developing relationships. 12. To be effective, the participants in a sales club should sell competing products. Answer: False Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Sales lead clubs consist of salespeople in related but noncompetitive fields. The group members share leads and prospecting tips. 13. An effective way to attract prospects without having to go out prospecting is to submit regular articles about your business to trade magazines, journals, and newspapers. Answer: True Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Remember AACSB: Analytic Level of Difficulty: EasyChapter 07 - Prospecting – The Lifeblood of Selling 7-5 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Submitting articles about your field or industry to journals, trade magazines, and newspapers is an effective prospecting method. By convincing an editor that you’re an expert in your field, you become one. Once prospects think of you as an expert, you’ll be the one they contact when they’re ready to buy. Thus, you attract prospects without having to go out prospecting. 14. For success at trade shows, memorize your sales pitch so that you get your message across succinctly. Answer: False Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: At a trade show, it is important to practice communicating two or three key points that get your message across succinctly. Get it down pat but don’t memorize your sales pitch to make it sound overly canned. 15. Trade shows are rarely worth the salesperson's time since there are only a few minutes to qualify leads and get the information necessary to conduct a sales call later. Answer: False Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Trade shows can be beneficial for salespeople. Although salesperson–buyer contact is usually brief, this type of gathering gives a salesperson extensive contact with a large number of potential buyers over a short time. 16. The center of influence prospecting method involves finding influential people who are willing to help a salesperson identify prospects. Answer: True Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Prospecting via the center of influence method involves finding and cultivating people in a community or territory who are willing to cooperate in helping to find prospects. They typically have a particular position that includes some form of influence over other people, as well as information that allows the salesperson to identify good prospects.Chapter 07 - Prospecting – The Lifeblood of Selling 7-6 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 17. Telephone prospecting is more expensive than the use of canvassing sales force for contacting a large number of prospects. Answer: False Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The use of telephone prospecting to contact a large number of prospects across a vast area is far less costly than use of a canvassing sales force. The telephone method allows for inexpensive interaction between a lead and a caller. 18. Telemarketing involves the use of trained personnel to conduct planned, measurable marketing activities directed at targeted groups of consumers. Answer: True Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Telemarketing is a marketing communication system using telecommunication technology and trained personnel to conduct planned, measurable marketing activities directed at targeted groups of consumers. 19. By focusing on meeting center-of-influence people, a salesperson can cultivate a network and increase referral business. Answer: True Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A salesperson should focus on meeting center-of-influence people to cultivate a network. These people have established a good reputation and have many valuable contacts. 20. The networking prospecting method is effective and reliable because people want to do business with people they know, like, and trust. Answer: True Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 07 - Prospecting – The Lifeblood of Selling 7-7 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Of the many ways to find new prospects, networking can be the most reliable and effective. People want to do business with, and refer business to, people they know, like, and trust. The days of the one-shot salesperson are over; the name of the game today is relationship building. 21. The primary goal of networking is to create as much exposure and free publicity for your product as possible. Answer: False Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Building a network is important, but cultivating that network brings sales. The key is positioning, not exposure. The 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. 22. Ninety-nine percent of your first conversation with a networking prospect should be about your products and services. Answer: False Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Ninety-nine percent of your first conversation with a networking prospect should be about his or her business. People want to talk about their business, not yours. 23. One of the guidelines for developing your own "best" prospecting method is to always call back on prospects who did not buy. Answer: True Learning Objective: 07-03 Topic: Prospecting Guidelines Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A salesperson should always call back on prospects who did not buy. With new products, do not restrict yourself to present customers only. A business may not have purchased your present products because they did not fit their present needs; however, your new product may be exactly what they need.Chapter 07 - Prospecting – The Lifeblood of Selling 7-8 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 24. Prospect pools generally include referrals and orphaned customers. Answer: True Learning Objective: 07-03 Topic: Prospecting Guidelines Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The prospect pool is a group of names gathered from various sources. Prospect pools usually include leads, referrals, orphans, and current customers. 25. Obtaining referrals is a continuous process for salespeople. Answer: True Learning Objective: 07-04 Topic: The Referral Cycle Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Obtaining referrals is a continuous process without beginning or end. The salesperson is always looking for the right opportunity to find a referral. 26. In a parallel referral sale, salespeople must sell the product as well as the after-sales service. Answer: False Learning Objective: 07-04 Topic: The Referral Cycle Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Salespeople must sell the product, plus sell the prospect on providing referrals. This is known as the parallel referral sale. Equal emphasis must be given to both the product sale and the referral sale. 27. The sales presentation provides salespeople with very little opportunity to influence a prospect. Answer: False Learning Objective: 07-04 Topic: The Referral Cycle Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: During the presentation you have the greatest opportunity to influence your prospect. It is important to understand that your prospect will scrutinize everything you say and do, whether it be through words, expressions, or body language. During this presentation you also must be conscious of presenting your desire to get referrals.Chapter 07 - Prospecting – The Lifeblood of Selling 7-9 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 28. The presentation phase of the referral cycle begins when you sit down with your prospects for a sales presentation. Answer: True Learning Objective: 07-04 Topic: The Referral Cycle Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The presentation phase of the referral cycle actually begins when you sit down with your prospects for the purpose of making a sales presentation. As smoothly as possible, you should make a conscious effort to mention the referring person. 29. The product delivery phase most likely represents the end of a relationship with a client if continued service is unnecessary. Answer: True Learning Objective: 07-04 Topic: The Referral Cycle Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: For many salespeople, the product delivery phase represents the end of the relationship with their clients. This occurs when the nature of the business does not require any additional service. 30. The most successful salespeople never experience call reluctance. Answer: False Learning Objective: 07-05 Topic: Call Reluctance Costs You Money! Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: All salespeople seem to have call reluctance from time to time. An estimated 40 percent of all salespeople suffer a career-threatening bout of call reluctance at some point. In its milder forms, call reluctance keeps countless salespeople from achieving their potential. 31. The practice of making an appointment before calling on a prospect shows respect toward the prospect. Answer: True Learning Objective: 07-05 Topic: Obtaining the Sales Interview Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 07 - Prospecting – The Lifeblood of Selling 7-10 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Appointment making is often associated with a serious, professional image and is sometimes taken as an outward gesture of respect toward a prospect. People are generally more receptive when they expect someone than when an unfamiliar salesperson pops in. 32. One excellent way for a salesperson to obtain an appointment with a prospect is to have a customer make the appointment for the salesperson. Answer: True Learning Objective: 07-05 Topic: Obtaining the Sales Interview Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Having a satisfied customer make an appointment for a salesperson is a common practice. The method frequently works and is fairly simple. 33. Successful use of the telephone in appointment scheduling requires a chatty message that hints of a desire to establish a long-term relationship with the prospect. Answer: False Learning Objective: 07-05 Topic: Obtaining the Sales Interview Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Successful use of the telephone in appointment scheduling requires an organized, clear message that captures interest quickly. The message should be brief and not chatty. 34. It is unwise and unethical to develop friends in the client's firm for the purpose of making a sale. Answer: False Learning Objective: 07-05 Topic: Obtaining the Sales Interview Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Successful salespeople know that people within the prospect’s firm often indirectly help in arranging an interview and influence buyers to purchase a product. The practice is appropriate and not considered unethical. 35. Respect, trust, time, and friendship are key elements in any salesperson's success. Answer: True Learning Objective: 07-05 Topic: Obtaining the Sales Interview Blooms: Remember AACSB: AnalyticChapter 07 - Prospecting – The Lifeblood of Selling 7-11 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: Respect, trust, and friendship are three key elements in any salesperson’s success. Exhibiting these qualities to prospects and customers is highly beneficial and may lead to more referrals. Multiple Choice Questions 36. _____ is defined as the series of sequential actions by a salesperson that leads toward the customer taking a desired action and ends with a follow-up to ensure purchase satisfaction. A. Sales presentation B. Referral cycle C. Sales process D. Networking cycle E. Prospecting process Answer: C Learning Objective: 07-01 Topic: The Sales Process Has 10 Steps Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The sales process refers to a sequential series of actions by the salesperson that leads toward the prospect or customer taking a desired action and ends with a follow-up to ensure purchase satisfaction. This selling process involves 10 basic steps. 37. Which of the following statements about the selling process is true? A. The selling process consists of ten basic steps. B. Some steps in the selling process occur simultaneously. C. Prospecting is the second step in the selling process. D. Preapproach planning is the third step in the selling process. E. Trial close is the last step of the selling process. Answer: A Learning Objective: 07-01 Topic: The Sales Process Has 10 Steps Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The selling process involves 10 different steps that occur sequentially. The first step is prospecting, and the third step is preapproach. Trial close occurs in the eighth step.Chapter 07 - Prospecting – The Lifeblood of Selling 7-12 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 38. According to the Golden Rule of Selling, referrals are gained by: A. encouraging customers to hear to what you are saying. B. demonstrating how much you want to succeed. C. demonstrating integrity with customers. D. following the 80/20 principle of selling. E. making sure every sale results in a purchase. Answer: C Learning Objective: 07-04 Topic: The Golden Rule: Prospecting Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: Being honest and ethical with customers is the basis of the Golden Rule of Selling. Referrals are earned by demonstrating your integrity, trustfulness, and character to the customer who eventually provides you the referral. 39. After presentation, the next step in the selling process is: A. to determine objections. B. the referral cycle. C. to follow-up. D. the trial close. E. to meet objections. Answer: D Learning Objective: 07-01 Topic: The Sales Process Has 10 Steps Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The presentation is followed in order by a trial close, determining objections, meeting objections, and another trial close. 40. Which of the following occurs before the sales presentation? A. Trial close B. Determining objections C. Preapproach D. Follow-up E. Meeting objections Answer: C Learning Objective: 07-01 Topic: Steps before the Sales Presentation Blooms: Remember AACSB: Analytic Level of Difficulty: EasyChapter 07 - Prospecting – The Lifeblood of Selling 7-13 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Prior to a sales presentation, a salesperson must conduct a preapproach. Conducting a trial close, addressing objections, and engaging in follow-up occur after a sales presentation. 41. A qualified person or organization that has the potential to buy your goods or services is a: A. suspect. B. volunteer. C. lead. D. partner. E. prospect. Answer: E Learning Objective: 07-02 Topic: Prospecting—The Lifeblood of Selling Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A prospect is a qualified person or organization that has the potential to buy your good or service. The name of a person or organization that might be a prospect is referred to as a lead, which is also referred to as a suspect. 42. One of the reasons why a salesperson must constantly look for new prospects is to: A. fill-in otherwise unproductive parts of the day. B. gain additional sales presentation experience. C. fulfill corporate social responsibilities. D. prevent the loss of current customers. E. increase product and service sales. Answer: E Learning Objective: 07-02 Topic: Prospecting—The Lifeblood of Selling Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Prospecting is the lifeblood of sales because it identifies potential customers. A salesperson must look constantly for new prospects to increase sales and to replace customers that will be lost over time.Chapter 07 - Prospecting – The Lifeblood of Selling 7-14 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 43. _____ is the process of determining if a suspect is to become a prospect. A. Scheduling B. Networking C. Qualifying D. Routing E. Funneling Answer: C Learning Objective: 07-02 Topic: Prospecting—The Lifeblood of Selling Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The name of a person or organization that might be a prospect is referred to as a lead. A lead can also be referred to as a suspect, indicating that the person or organization is suspected of being a prospect. Once the lead has been qualified, it becomes a prospect. 44. Ann's attempt to open a restaurant failed, and she is now trying to sell furniture and equipment she purchased. She suspects that Handlemann's Deli may be a potential buyer for the furniture. Ann should now engage in the _____ process to determine if it is worth her time to convince Handelmann to buy. A. qualifying B. funneling C. networking D. routing E. leading Answer: A Learning Objective: 07-02 Topic: Prospecting—The Lifeblood of Selling Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Determining if a lead or a suspect will become a prospect is known as qualifying. Individuals are qualified prospects if they have the money, authority, and desire to buy.Chapter 07 - Prospecting – The Lifeblood of Selling 7-15 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 45. Rico's sales manager has told him that if he wants to quit wasting time making presentations to people who are not qualified, he should think "MAD." What was the sales manager trying to tell Rico? A. Rico should set up a "money accumulation determination" system for himself as a form of motivation. B. Rico can improve his presentations and make them more memorable if he "makes a demonstration" on each sales call. C. Rico can improve his success rate if he persuades customers that his products can "make a difference." D. Rico should qualify his prospects by determining if they have the ―money, authority, and desire‖ to buy. E. Rico must ―motivate‖ his customers to pay ―attention,‖ and use his sales presentations to create ―demand.‖ Answer: D Learning Objective: 07-02 Topic: Prospecting—The Lifeblood of Selling Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Determining if a lead or a suspect will become a prospect is known as qualifying which is a process that can be remembered using the word ―MAD.‖ Individuals are qualified prospects if they have the money, authority, and desire to buy. 46. The sales manager at OBC Office Supplies has determined that the office manager of Hoffman Realty has the money, desire, and authority to purchase a new copy machine. Hoffman Realty is best described as a: A. potential referral. B. qualified prospect. C. network prospect. D. qualified referral. E. network agent. Answer: B Learning Objective: 07-03 Topic: Prospecting—The Lifeblood of Selling Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Individuals are qualified prospects if they have the money, authority, and desire to buy. True prospects have the financial resources and the authority to make a purchase, although they may not yet realize a need.Chapter 07 - Prospecting – The Lifeblood of Selling 7-16 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 47. Which of the following statements holds true of e-prospecting? A. E-prospecting is less efficient than trade shows for finding prospects. B. E-prospecting is heavily dependent on qualified referrals. C. E-prospecting should only be used to sell nontechnical products. D. E-prospecting requires no monetary investment by salespeople. E. E-prospecting is a fast and easy way to find information. Answer: E Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Understand AACSB: Technology Level of Difficulty: Medium Explanation: E-prospecting offers a much faster and easier way to find information about prospects than most other methods. Some information can be accessed for free but others may require a fee. 48. Sonia Taylor has a collection of hand-tied fishing flies left to her by her great-grandfather. She has learned the fishing flies are valuable and would like to sell them. Sonia has used the Web to locate dealers of antique fishing gear who might be interested in purchasing the collection. Sonia has engaged in: A. data mining. B. e-prospecting. C. direct marketing. D. direct selling. E. networking. Answer: B Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Understand AACSB: Technology Level of Difficulty: Medium Explanation: The most recent advancement in prospecting is the use of the Internet to find potential buyers. This is called e-prospecting, and it is a fast and easy way to find information about individuals or businesses by using technology.Chapter 07 - Prospecting – The Lifeblood of Selling 7-17 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 49. What is the basis for cold canvassing? A. Law of averages B. Endless chain referral C. Center of influence D. Prospect pooling E. Parallel referrals Answer: A Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The cold canvass prospecting method is based on the law of averages. The salesperson contacts in person, by phone, and/or by mail as many leads as possible, recognizing that a certain percentage of people approached will buy. 50. Abel, a teenager, is trying to earn money by operating a dog walking service. Abel is knocking on the door of every dog owner within a six-block radius of his house and asking if the homeowner would like to use his service. Abel is using the _____ method of prospecting. A. public demonstration B. group C. referral D. cold canvass E. endless chain Answer: D Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: With the cold canvass prospecting method, a salesperson contacts in person, by phone, and/or by mail as many leads as possible. Abel probably realizes that a certain percentage of people he approaches will want his service.Chapter 07 - Prospecting – The Lifeblood of Selling 7-18 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 51. Danny is out of work, but he is very good at fixing things around the house. He has spent much of his time during the last week going door-to-door asking people who live in the area if they have any odd jobs for him. In terms of the selling process, Danny is engaged in: A. prospecting. B. identifying. C. referring. D. networking. E. direct marketing. Answer: A Learning Objective: 07-03 Topic: Prospecting—The Lifeblood of Selling Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: Danny is prospecting in the neighborhood by knocking on doors. Networking would require Danny to gather the contact information of influential people who might know where he could obtain work. 52. Lydia sells an exclusive range of cosmetic products. She makes door-to-door sales calls. At each house after a sale she asks the homeowner if they know anyone who would be interested in her products. What prospecting method does Lydia use? A. Center of influence B. Cold canvas C. Group D. Endless chain E. Observation Answer: D Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The endless chain referral method occurs when a satisfied customer refers a salesperson to an acquaintance. Such referrals can generate a steady stream of prospects.Chapter 07 - Prospecting – The Lifeblood of Selling 7-19 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 53. A salesperson successfully using the endless referral chain method of prospecting most likely: A. never leaves a sales call without at least two referrals. B. asks customers to set up future appointments with referrals. C. asks customers to become members of local sales lead clubs. D. receives customer referrals primarily from orphaned customers. E. spends time building relationships with customers to get future referrals. Answer: E Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The endless chain referral method occurs when a satisfied customer refers a salesperson to an acquaintance. The method requires a salesperson to build strong relationships with current customers to gain future referrals. 54. The two best sources of future sales are: A. customers and customer referrals. B. colleagues and centers of influence. C. customers and e-prospects. D. sales lead clubs and referrals. E. orphaned customers and current customers. Answer: A Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Customers and customer referrals are the two best sources of future sales, with repeat sales from customers being better.Chapter 07 - Prospecting – The Lifeblood of Selling 7-20 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 55. Langley sells truck bed liners guaranteed to last for 20 years. After every sale, Langley asks his customers for the names of several friends who might also be interested in protecting the beds of their trucks. He then calls on those people and also asks them for names. Langley is using the _____ method of prospecting. A. customer-oriented B. cold canvass C. orphaned customer D. endless chain referral E. sales lead club Answer: D Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The endless chain referral method occurs when a satisfied customer refers a salesperson to an acquaintance. Such referrals can generate a steady stream of prospects. 56. If Cary left her pharmaceutical sales job to take a management position in another company, her customers would become: A. suspects B. prospects. C. segments. D. orphans E. referrals. Answer: D Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Orphaned customers are customers whose salesperson has left the company. Salespeople often leave their employers to take other jobs; when they do, their customers are orphaned. 57. Kylie Lumberton was hired by a cosmetics company to replace a former employee. She did not know where to start looking for customers to start her sales. The ideal place for her to start would be: A. sales lead clubs. B. cold canvassing. C. orphaned customers. D. customer referrals. E. e-prospecting. Answer: C Learning Objective: 07-03Chapter 07 - Prospecting – The Lifeblood of Selling 7-21 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Topic: Prospecting Methods Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Orphaned customers are customers whose salesperson has left the company. Salespeople often leave their employers to take other jobs; when they do, their customers are orphaned. These orphans would be great prospects for Kylie. 58. An insurance salesperson would most likely join a sales lead club to: A. meet other insurance salespeople. B. avoid making parallel referral sales. C. share leads and prospecting tips. D. practice new sales presentations. E. evaluate sales procedures. Answer: C Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Sales lead clubs are formed to share leads and prospecting tips. Groups are usually made up of salespeople in related but noncompetitive fields. 59. In Kingston, a group of salespeople get together for breakfast on the first and third Tuesday of each month. The purpose of their meeting is to share leads and prospecting tips. The group charges quarterly dues of $65, and participants must sell noncompetitive products. This group is an example of a(n): A. prospect network. B. sales lead club. C. illegal pyramid scheme. D. orphan prospect club. E. list of prospects. Answer: B Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Sales lead clubs are formed to share leads and prospecting tips. Groups are usually made up of salespeople in related but noncompetitive fields.Chapter 07 - Prospecting – The Lifeblood of Selling 7-22 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 60. The members of a sales lead club: A. use the club primarily for socialization. B. sell products of the same category. C. sell competitive products. D. belong to noncompetitive fields. E. sell for the same corporation. Answer: D Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Sales lead clubs are formed to share leads and prospecting tips. Groups are usually made up of salespeople in related but noncompetitive fields. 61. Kenton is a busy insurance salesperson, yet twice a month he writes a column for the local newspaper in which he addresses issues concerning financial security. The most logical reason for such activity is to: A. motivate other insurance salespeople. B. protect his financial investments. C. support new stakeholders. D. create prospects. E. qualify prospects. Answer: D Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: By writing articles, Kenton is presenting himself as an insurance expert and marketing his name and business. He hopes that prospects will contact him when they are ready to buy insurance.Chapter 07 - Prospecting – The Lifeblood of Selling 7-23 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 62. Terrell, the marketing manager of Tekna Tools, is planning to attend the Anaheim Woodworking Trade Fair. Terrell will have a higher probability of success if he: A. memorizes his sales pitch. B. avoids the use of lead cards. C. sets up in an area with little foot traffic. D. acts assertively toward approaching passersby. E. refuses to accept any rejections from leads and prospects. Answer: D Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Terrell should be assertive with people walking by to garner interest in his products and engage potential customers in a conversation. Memorizing a pitch can seem canned, and it is important to be seen by others, which is why a high traffic area is important. 63. In order to serve more pet owners, East Rome Boarding Kennel seeks the assistance of area veterinarians in identifying people who are likely to need its services. This is an example of the _____ method of prospecting. A. cold canvass B. group C. public exhibition D. center of influence E. endless chain Answer: D Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Prospecting via the center of influence method involves finding and cultivating people in a community or territory who are willing to cooperate in helping to find prospects. Veterinarians are in contact with pet owners, so they would be beneficial to the kennel owners.Chapter 07 - Prospecting – The Lifeblood of Selling 7-24 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 64. Prospecting via the _____ method involves finding and cultivating people in a community who are willing to help a salesperson find prospects. A. cold canvass B. group C. public exhibition D. center of influence E. endless chain Answer: D Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Prospecting via the center of influence method involves finding and cultivating people in a community or territory who are willing to cooperate in helping to find prospects. They typically have a particular position that includes some form of influence over other people, as well as information that allows the salesperson to identify good prospects. 65. In cases where there are a large number of prospects for a product, a salesperson should most likely use: A. direct-mail prospecting. B. center of influence prospecting. C. sales lead club funneling. D. endless chain prospecting. E. cold canvass prospecting. Answer: A Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: In cases where there are a large number of prospects for a product, direct-mail prospecting is sometimes an effective way to contact individuals and businesses. 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 when compared to the cost of using salespeople.Chapter 07 - Prospecting – The Lifeblood of Selling 7-25 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 66. Which of the following prospecting methods is most similar to telephone prospecting in terms of its objective? A. Cold canvassing B. Endless chain of referrals C. Networking D. Direct-mail prospecting E. Observation Answer: D Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Like direct marketing, use of telephone prospecting to contact a large number of prospects across a vast area is far less costly than use of a canvassing sales force, though usually more costly than mail outs. 67. Which of the following statements about telephone prospecting is true? A. It is less expensive than direct-mail prospecting. B. It allows for quick qualification or rejection of a lead. C. It is good for targeting niche prospects. D. It is also called electronic canvassing. E. It is more costly than a canvassing sales force. Answer: B Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The telemarketer and lead interact on the phone in this prospecting method, which is more expensive than direct mail and less costly than a canvassing sales force. It is an efficient way to contact many prospects in a large area. 68. Last night while he was eating dinner, Leo got a phone call from a salesperson who wanted to know if he would be interested in subscribing to the local newspaper. The salesperson would best be described as a: A. endless chain prospect. B. center of influence. C. telemarketer. D. prospect. E. referral. Answer: C Learning Objective: 07-03 Topic: Prospecting Methods Blooms: UnderstandChapter 07 - Prospecting – The Lifeblood of Selling 7-26 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Medium Explanation: Telemarketing involves using trained telephone marketers, known as telemarketers, to call people who have been identified as a targeted group of potential consumers. Telemarketing is a prospecting method. 69. Elias does home repairs. On Sunday afternoons, he often drives in the community in which he lives looking for homes that need minor repairs and/or painting. Monday morning he calls those homeowners and offers his services. Elias is using the _____ method of prospecting. A. observation B. preapproach C. networking D. endless chain E. center of influence Answer: A Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A salesperson often can find prospects by constantly watching what is happening in the sales area—the observation method. Harry is making observations of the homes and then contacting those homeowners to see if they want his services. 70. Norman, the owner of CompuTex, recently installed computers at Harding Industries. Norman recommended that the Harding Industries office manager contact Computer Services, Inc. to schedule a computer training class for Harding's employees. This is an example of the _____ method of prospecting. A. observation B. preapproach C. endless chain D. center of influence E. networking Answer: E Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Networking refers to the process of making and using contacts. Computer Services benefits from Norman recommending their services to Harding Industries.Chapter 07 - Prospecting – The Lifeblood of Selling 7-27 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 71. The term given to making and using contacts for the purpose of prospecting is: A. observing. B. approaching. C. telemarketing. D. influencing. E. networking. Answer: E Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Salespeople are always on the lookout for customers. Everyone they meet may be a prospect, or that person may provide a name that could lead to a sale. The term given to making and using contacts is networking. 72. What is the most reliable and effective method for finding new prospects? A. Cold canvassing B. Direct mail C. Networking D. Telemarketing E. Observation Answer: C Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Of the many ways to find new prospects, networking can be the most reliable and effective. People want to do business with, and refer business to, people they know, like, and trust. 73. In order to cultivate a network, a salesperson should: A. focus on meeting center-of-influence people. B. use contact management software. C. create a customer MAD file. D. request on-the-job training. E. use the KISS principle. Answer: A Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 07 - Prospecting – The Lifeblood of Selling 7-28 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Meeting influential people at trade shows and other events is important to building a network because they can be good prospect sources. A salesperson should keep contacts organized using a contact management program. 74. Jon Querillian wants to create a network of prospects for his landscaping business. Which of the following would be the LEAST effective method? A. Sending thank-you notes to people who provide leads B. Focusing on meeting center-of-influence people C. Asking open-ended, feel-good types of questions D. Sending contacts monthly sales promotional items E. Sending contacts unflattering information about the competition Answer: E Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Sending thank-you notes and promotional information are effective ways to build a network but negative information about the competition would be unwelcome. Perry should focus on meeting influential people at trade shows and other events because they can be good prospect sources. 75. For you as a salesperson to find an optimal prospecting method, the text suggests you do all the following EXCEPT: A. always call back on prospects who did not buy. B. copy the prospecting methods of successful salespeople. C. concentrate on high-potential customers before low-potential customers. D. contact all prospects and current customers when you have a new product. E. customize a prospecting method that suits the needs of your individual firm. Answer: B Learning Objective: 07-03 Topic: Prospecting Guidelines Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: Customize or choose a prospecting method that fits the specific needs of your individual firm, but do not copy another company’s method. Reach out to high-potential customers before low-potential ones.Chapter 07 - Prospecting – The Lifeblood of Selling 7-29 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 76. Which term refers to a group of names of potential customers gathered from a variety of sources? A. Orphans B. Qualified prospect C. Prospect pool D. Customer canvass E. Leaking customer bucket Answer: C Learning Objective: 07-03 Topic: Prospecting Guidelines Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The prospect pool is a group of names gathered from various sources. Your source, for example, may be a mailing list, telephone book, referrals, orphans, or existing customers. 77. Within a salesperson's prospect pool, which group is the most important prospect for future sales? A. Leads B. Referrals C. Centers of influence D. Salesperson's customers E. Orphans Answer: D Learning Objective: 07-03 Topic: Prospecting Guidelines Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Current customers are the best source of future sales for a salesperson. However, leads, referrals, and orphans are also important in the prospect pool.Chapter 07 - Prospecting – The Lifeblood of Selling 7-30 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 78. Which of the following statements about referrals is true? A. Salespeople should work on obtaining referrals when they are not engaged in selling activities B. It would be inappropriate to try to enact the referral cycle during the sales presentation C. Salespeople must sell the product, plus sell the prospect on providing referrals D. All salespeople ask for customer referrals E. The referral cycle consists of three steps Answer: C Learning Objective: 07-04 Topic: The Referral Cycle Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: In addition to selling a product, salespeople must encourage customers to give them a referral. Salespeople can ask for a referral at any stage of the the four-step referral cycle. 79. Salespeople must sell the product, plus sell the prospect on providing referrals. This is known as the: A. endless chain method. B. canvassing method. C. parallel referral sale. D. cyclical method of referral. E. referral qualification. Answer: C Learning Objective: 07-04 Topic: The Referral Cycle Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Salespeople must sell the product, plus sell the prospect on providing referrals. This is known as the parallel referral sale. Equal emphasis must be given to both the product sale and the referral sale. 80. Which of the following is NOT an appropriate time to request a referral? A. Preapproach B. Sales presentation C. Product delivery stage D. Service and follow-up E. Trial close stage Answer: E Learning Objective: 07-04 Topic: The Referral Cycle Blooms: Understand AACSB: AnalyticChapter 07 - Prospecting – The Lifeblood of Selling 7-31 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: During the trial close of a presentation, a salesperson is assessing the attitude of the prospect about a product, which would not be an effective time to request a referral. The four stages of the referral cycle are preapproach, presentation, product delivery, and service and follow-up. 81. The _____ phase of the referral cycle provides a salesperson with ongoing opportunities to maintain contact with clients. A. service and follow up B. closing C. product delivery D. presentation E. preapproach Answer: A Learning Objective: 07-04 Topic: The Referral Cycle Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The service and follow-up phase of the referral cycle provides you with ongoing opportunities to maintain contact with your clients. Anytime that you have contact with your clients you encounter the possibility of getting more referrals. 82. Which term refers to the performance of any helpful or professional work or activity for a person, family, or organization? A. Customer satisfaction B. Value creation C. Customer service D. Market follow-up E. Service customization Answer: C Learning Objective: 07-04 Topic: The Referral Cycle Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Customer service is the performance of any helpful or professional work or activity for a person, family, or organization. The service and follow-up phase of the referral cycle provides you with ongoing opportunities to maintain contact with your clients.Chapter 07 - Prospecting – The Lifeblood of Selling 7-32 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 83. A salesperson has the greatest opportunity to influence a prospect: A. when prospecting. B. in the trial close. C. in the approach phase. D. when determining objections. E. during the presentation. Answer: E Learning Objective: 07-04 Topic: The Referral Cycle Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: During the presentation you have the greatest opportunity to influence your prospect. It is important to understand that your prospect will scrutinize everything you say and do, whether it be through words, expressions, or body language. 84. Daniel sells medical equipment, and he has been advised to contact the comptroller at the Cedar Bluff Public Hospital because the hospital plans on building and equipping 150 medical and dental offices in its new health care complex. Daniel has not yet made the sales call because he hates to be pushy. Daniel is experiencing: A. referral breakdown. B. sales hesitation. C. prospect aversion. D. call reluctance. E. lead negation. Answer: D Learning Objective: 07-05 Topic: Call Reluctance Costs You Money! Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Call reluctance refers to not wanting to contact a prospect or customer. This tendency is an occasional problem for many salespeople. 85. What is the first step in learning how to overcome call reluctance? A. Determine your personality type B. Avoid customers that refuse to buy C. Admit having a call reluctance problem D. Seek help for treating call reluctance issues E. Practice verbal and nonverbal communication Answer: C Learning Objective: 07-05 Topic: Call Reluctance Costs You Money! Blooms: Understand AACSB: AnalyticChapter 07 - Prospecting – The Lifeblood of Selling 7-33 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: You must admit you have call reluctance and that your call reluctance is keeping you from helping others and earning what you’re worth. For many salespeople, owning up to call reluctance is the most difficult part of combating it. 86. Because they are so busy, many executives have filtration systems to protect their time. In order to get through this system, you, as a professional salesperson, should do all of the following EXCEPT: A. not waste time waiting. B. develop friends in the prospect's firm. C. call at the right time on the right person. D. believe in yourself. E. follow the prospect. Answer: E Learning Objective: 07-05 Topic: Obtaining the Sales Interview Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Following a prospect would be invasive and inappropriate. However, it would be best to develop friends in the firm, be confident, and use your time wisely by calling on people in the firm who participate in the purchase decision. Innovative Installers Innovative Installers provides a variety of services related to office space and relocations including installation services. Innovative Installers is owned and operated by Mierzett Evans and his sister Glenda Heldris. The company uses a variety of marketing methods including a Web site, cold calls, and direct mail. Evans and Heldris believe the company could better communicate with potential customers who may not know of the company's existence.Chapter 07 - Prospecting – The Lifeblood of Selling 7-34 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 87. Evans and Heldris are expressing concern about: A. their preapproach. B. their choice of sales presentations. C. prospecting. D. handling objections. E. the entire sales process. Answer: C Learning Objective: 07-03 Topic: Planning a Prospecting Strategy Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Evans and Heldris are concerned about the prospecting strategies and methods used by the firm. A successful salesperson continually evaluates prospecting methods, comparing results and records with the mode of prospecting used in pursuit of a prospecting strategy that will result in the most effective contact rate. 88. The siblings use the corporate Web site to inform potential customers about the services their company offers. The Web address is included in all of the company's advertising. In other words, Evans and Heldris are using: A. e-prospecting. B. direct communication. C. direct sales. D. Internet dialoguing. E. cold sales. Answer: A Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Understand AACSB: Technology Level of Difficulty: Medium Explanation: Using the Internet to find potential buyers is known as e-prospecting. Eprospecting is a fast and easy way to find information about individuals and businesses. 89. When the company uses cold calling to find potential customers, it is basing its methodology on the: A. Sherman's Law of Referrals. B. laws of comparative advantage. C. the iceberg principle. D. the 80/20 rule. E. the law of averages. Answer: E Learning Objective: 07-03 Topic: Prospecting Methods Blooms: UnderstandChapter 07 - Prospecting – The Lifeblood of Selling 7-35 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Medium Explanation: The cold canvass prospecting method is based on the law of averages. For example, if past experience reveals that 1 person out of 10 will buy a product, then 50 sales calls could result in five sales. Thus, the salesperson contacts in person, by phone, and/or by mail as many leads as possible, recognizing that a certain percentage of people approached will buy. 90. To use direct mail successfully as a means of locating potential customers, the company must: A. have low postage costs. B. mail only to people who have MAD. C. have a large database of possible customers. D. have an in-house operation for printing and mailing. E. prequalify recipients before sending out advertisements. Answer: C Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: 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 when compared to the cost of using salespeople. The firm should have a large database of customers to contact for this to be beneficial. Essay Questions 91. What is the sales process? What are the steps in the selling process? Answer: The sales process refers to a sequential series of actions by the salesperson that leads toward the customer taking a desired action and ends with a follow-up to ensure purchase satisfaction. Although many factors may influence how a salesperson makes a presentation in any one situation, a logical, sequential series of actions exists that, if followed, can greatly increase the chances of making a sale. This selling process involves 10 basic steps as follows: Prospecting, preapproach, approach, presentation, trial close, determine objections, meet objections, trial close, close, and follow-up. Learning Objective: 07-01 Topic: The Sales Process Has 10 Steps Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 07 - Prospecting – The Lifeblood of Selling 7-36 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 92. What is a prospect? Why is prospecting important? What qualities determine whether or not a prospect is qualified? Answer: A prospect is a qualified person or organization that has the potential to buy your good or service. Prospecting is the lifeblood of sales because it identifies potential customers. As a salesperson, you can ask yourself three questions to determine if an individual or organization is a qualified prospect: 1. Does the prospect have the money to buy? 2. Does the prospect have the authority to buy? 3. Does the prospect have the desire to buy? Learning Objective: 07-02 Topic: Prospecting—The Lifeblood of Selling Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 93. What is the leaking bucket customer concept? What are its implications for salespeople? Answer: The "leaking bucket concept" suggests that new customers come and X percent of them leave per year. It is always easier to sell to a satisfied customer than an unsatisfied one or a prospect, considering the element that the cost of acquiring a new customer is higher than keeping a present customer. New customers come into the top and leave through a hole in the bottom of the bucket. This is why service and follow-up after the sale are so important to salespeople. Learning Objective: 07-02 Topic: The Leaking Bucket Customer Concept Blooms: Analyze AACSB: Analytic Level of Difficulty: Hard 94. How has technology changed the prospecting component of the sales process? How do modern salespeople use technology when prospecting? Answer: The most recent advancement in prospecting is the use of the Internet to find potential buyers. This is called e-prospecting, and it is a fast and easy way to find information about individuals or businesses by using technology. Finding information on the Internet about individuals can be very helpful to a salesperson. A search engine could also be used to find information on a person. For organizations, in today's e-driven world, most businesses have their own Web sites. On these sites, a salesperson can find useful information that can help him or her decide if the company is a potential buyer. Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Apply AACSB: Technology Level of Difficulty: HardChapter 07 - Prospecting – The Lifeblood of Selling 7-37 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 95. What is a parallel referral sale? How can a salesperson facilitate a parallel referral sale? Answer: In the parallel referral sale, salespeople sell the product to the prospect and sell the prospect on providing referrals at the same time. You must nurture a parallel referral sale from the time of the initial contact, such as when making an appointment. The referral sale should receive equal importance, effort, and emphasis as the product sale. Learning Objective: 07-04 Topic: The Referral Cycle Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 96. In a sales training class, Evan was told never to ask a current customer about anyone else who could use the products he sold. He was also told that referrals were important to his success as a salesperson. Explain to Evan how the two statements do not contradict each other. Answer: A referral is a person or organization recommended to you by someone who feels that person or organization can benefit from your product. Customer referrals are one of the two best sources for prospects. However, the salesperson should not ask, "Do you know anyone else who could use my products?" Rarely are clients eager to judge whether colleagues are prepared to make a purchase. Instead, Moore should ask whether his customer knows any other individuals or organizations that might benefit from him or his products. Learning Objective: 07-04 Topic: The Referral Cycle Blooms: Analyze AACSB: Analytic Level of Difficulty: Hard 97. Briefly describe the center of influence method of prospecting. Answer: Prospecting via the center of influence method involves finding and cultivating people in a community or territory who are willing to cooperate in helping find prospects. These people typically have a particular position that includes some form of influence over other people as well as information that allows the salesperson to identify good prospects. It is equally important to show your appreciation for this person's assistance as keeping such influential persons informed on the outcome of your contact with the prospect helps to secure future aid. Learning Objective: 07-03 Topic: Prospecting Methods Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 07 - Prospecting – The Lifeblood of Selling 7-38 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 98. Kendra is an inexperienced salesperson. What three criteria would help her determine the best prospecting method for each type of sales situation? Answer: Prospecting methods should be chosen in light of the major factors defining a particular selling situation. Generalizations can be made, however, regarding the criteria used in choosing an optimal prospecting method for a particular selling. The criteria being: 1. Customize or choose a prospecting method that fits the specific needs of your individual firm. Do not copy another company's method; however, it's all right to adapt someone's method. 2. Concentrate on high-potential customers first, leaving for later, prospects of lower potential. 3. Always call back on prospects who did not buy. With new products, do not restrict yourself to present customers only. A business may not have purchased your present products because they did not fit their present needs; however, your new product may be exactly what they need. Learning Objective: 07-03 Topic: Prospecting Guidelines Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 99. What are some good practices to follow when setting an appointment over the telephone? Answer: A few practices can aid in successfully making an appointment over the telephone: Write out what you want to say. Clearly identify yourself and your company. State the purpose of the call and state briefly how the person may profit from your interview. Prepare a brief sales message that focuses upon benefits rather than features. Do not present too much information, but just enough to stimulate interest. Do not take no for an answer. Be persistent, even if there is a negative response to the call. Ask for an interview so that you can further explain product benefits. Phrase your appointment request as a question, which gets the prospect to make a choice. Learning Objective: 07-05 Topic: Obtaining the Sales Interview Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 07 - Prospecting – The Lifeblood of Selling 7-39 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 100. What are the benefits of making an appointment? Answer: Appointments save time wasted traveling and waiting to see someone who is busy or absent. Taking an appointment looks professional and shows respect toward a prospect. It sets aside time for the buyer to listen to the sales presentation. A list of appointments helps the salesperson optimally allocate each day's selling time. From the salesperson's point of view, an appointment provides a time set aside for the buyer to listen to a sales presentation. This is important because adequate time to explain a proposition improves the chance of making the sale. In addition, a list of appointments aids a salesperson in optimally allocating each day's selling time. Appointments can be arranged by telephone or by contacting the prospect's office in person. Learning Objective: 07-05 Topic: Obtaining the Sales Interview Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Difficulty: MediumChapter 08 - Planning the Sales Call Is a Must 8-1 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Chapter 08 Planning the Sales Call Is a Must Learning Objectives: 08-01 Explain the importance of sales call planning. 08-02 List the four planning steps in order and understand them. 08-03 Develop a customer benefit plan. 08-04 Describe the prospect’s five mental steps in buying. True / False Questions 1. Purpose is a list of plans, goals, or objectives that differ from one sales call to another. Answer: False Learning Objective: 08-01 Topic: The Golden Rule: Planning Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Purpose is not a list of plans, goals, or objectives that differ from one sales call to another. Purpose is a constant truth that guides your business life and directs how you approach each sales call. 2. A plan is a method of achieving an end. Answer: True Learning Objective: 08-01 Topic: The Golden Rule: Planning Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A plan is a method of achieving an end. A plan involves what you want to accomplish and how you will do it. 3. A salesperson can have a successful sales call without making a sale. Answer: True Learning Objective: 08-01 Topic: The Golden Rule: Planning Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A sales call is successful if a customer is helped in some way by the salesperson, which may or may not involve making a sale.Chapter 08 - Planning the Sales Call Is a Must 8-2 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 4. According to the text, empathy and kindness are the primary bridges between buyer and seller. Answer: False Learning Objective: 08-01 Topic: The Golden Rule: Planning Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Truth and trust build a bridge between a buyer and a seller. Long-term buyerseller relationships rely on truth and trust. 5. Successful people have a tendency to make, implement, and evaluate plans. Answer: True Learning Objective: 08-01 Topic: The Golden Rule: Planning Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The difference between successful people and less successful people is that successful people plan, implement their plans, and evaluate the day’s sales results in order to know what to do tomorrow. Less successful people think about planning but seldom do it. 6. Planning is synonymous with the approach stage of the sales process. Answer: False Learning Objective: 08-01 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Planning is referred to as the preapproach stage of the sales process. Approach occurs after planning/preapproach. 7. The purpose of the strategic customer relationship between a salesperson and a customer is the joint pursuit of mutual goals. Answer: True Learning Objective: 08-01 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A strategic customer relationship is formed to pursue mutual goals together. Customer goals may involve reducing costs, which a sales organization seeks to increase sales and profits.Chapter 08 - Planning the Sales Call Is a Must 8-3 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 8. Mutual goals of customers and sales organizations include increasing sales and profits. Answer: True Learning Objective: 08-01 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Strategic goals for a customer typically include reducing costs and/or increasing productivity, sales, and profits. The sales organization has goals of increasing sales and profits. 9. The ability of a salesperson to provide a "standard" solution for all customers is critical today. Answer: False Learning Objective: 08-01 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The ability of a salesperson to tailor a ―custom‖ solution for each customer is critical today. The salesperson needs to use creative problem solving to identify the specific solution that meets each customer’s needs. 10. According to surveys, there has been a shift in recent years from collaborative relationships between sellers and buyers to more adversarial arrangements. Answer: False Learning Objective: 08-01 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Salespeople and customers say that a significant shift has occurred in their expectations of the outcome of sales agreements—from the adversarial win–lose to the more collaborative ―win–win‖ arrangement. To achieve a mutually beneficial agreement, salespeople and customers must work together to develop a common understanding of the issues and challenges at hand.Chapter 08 - Planning the Sales Call Is a Must 8-4 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 11. Nervousness is a normal component of giving sales presentations, and there is nothing that can be done to reduce it. Answer: False Learning Objective: 08-01 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: In giving a speech before a large group, most people are nervous. You can greatly reduce this nervousness and increase self-confidence by planning what to say and practicing your talk. 12. The better a salesperson is at creatively marshaling all available resources to address a customer's strategic needs, the stronger the customer relationship becomes. Answer: True Learning Objective: 08-01 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A salesperson who can creatively address the needs of a customer is likely to build a strong relationship with the customer. Today’s salespeople need to be creative problem solvers who have the ability to develop and combine nontraditional alternatives to meet the specific needs of the customer. 13. Planning can greatly reduce a salesperson’s nervousness before a sales presentation. Answer: True Learning Objective: 08-01 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: In giving a speech before a large group, most people are nervous. You can greatly reduce this nervousness and increase self-confidence by planning what to say and practicing your talk.Chapter 08 - Planning the Sales Call Is a Must 8-5 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 14. Planning a sales call reflects professionalism and generally increases sales. Answer: True Learning Objective: 08-01 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A planned sales call shows respect for the customer and a sense of professionalism, both of which can increase sales. 15. When planning a sales call, the customer profile should be developed first and then based on the customer profile, the sales call objectives should be determined. Answer: False Learning Objective: 08-02 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The first step in planning a sales call is determining the sales call objective. After the objective has been identified, a customer profile can be developed. 16. An effective salesperson should always prepare the sales presentation before developing the customer profile and benefits. Answer: False Learning Objective: 08-02 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The first step in planning a sales call is determining the sales call objective. After the objective has been identified, a customer profile can be developed. The salesperson should then develop and review customer benefits before developing the sales presentation. 17. The best possible sales call objective is to get an order because it reflects the salesperson's self-confidence and a specific goal. Answer: False Learning Objective: 08-02 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Although getting an order is a positive goal, it is not specific. Sales goals should specify the needs of the prospect and the most suitable product or service.Chapter 08 - Planning the Sales Call Is a Must 8-6 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 18. A SMART sales call objective is specific, measurable, actionable, reliable, and temporary. Answer: False Learning Objective: 08-02 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: SMART call objectives are specific, measurable, achievable, realistic, and timed. 19. The customer profile of a firm should tell a salesperson which competitors successfully do business with the firm. Answer: True Learning Objective: 08-02 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Customer profiles address questions related to purchasing policies and practices, as well as the history of the account, the buyer’s background, and what competitors have done business with the customer. 20. The sales call objective should be directly beneficial to the customer. Answer: True Learning Objective: 08-02 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A sales call objective should be specific, measurable, and beneficial to the customer. 21. To keep from creating a sales bias, a customer profile typically contains no information about a prospect's buying history. Answer: False Learning Objective: 08-02 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Customer profiles address questions related to purchasing policies and practices, as well as the buying history of the account, the buyer’s background, and what competitors have done business with the customer.Chapter 08 - Planning the Sales Call Is a Must 8-7 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 22. It is impractical to get information about a prospective buyer through personal contacts with the company. Answer: False Learning Objective: 08-02 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A customer profile can be developed by reviewing records on the company and through personal contacts that a salesperson may have in the firm. 23. The customer benefit plan contains the nucleus of the information used in a salesperson's sales presentation. Answer: True Learning Objective: 08-03 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Beginning with your sales call objectives and what you know about your prospect, you are ready to develop a customer benefit plan. The customer benefit plan contains the nucleus of the information used in your sales presentation; thus it should be developed to the best of your ability. 24. The main reason a prospect purchases your product is that its benefits fulfill certain needs or solve certain problems. Answer: True Learning Objective: 08-03 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Select the features, advantages, and benefits of your product to present to your prospect because these address the issue of why the buyer should purchase your product. Your product should fulfill certain needs or solve certain problems for the buyer.Chapter 08 - Planning the Sales Call Is a Must 8-8 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 25. When Bruce Compton selects the features and advantages of a product that he will present to a prospect, Bruce is working on step three of a customer benefit plan. Answer: False Learning Objective: 08-03 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The first step of developing a customer benefit plan requires the salesperson to select the features, advantages, and benefits of a product to present to a prospect. This addresses the issue of why the buyer should purchase your product. The third step of developing a customer benefit plan addresses price and profit aspects. 26. Value analysis is an example of a business proposition for an industrial product. Answer: True Learning Objective: 08-03 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A value analysis would be suitable when making a business proposition for an industrial product. Other topics to discuss include list price, shipping costs, and discounts. 27. A suggested purchase order should accompany your business proposition and marketing plan. Answer: True Learning Objective: 08-02 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A suggested purchase order based on a customer benefit plan should be included with a business proposition and marketing plan. The suggestion may include, depending on your product, such things as what to buy, how much to buy, what assortment to buy, and when to ship the product to the customer.Chapter 08 - Planning the Sales Call Is a Must 8-9 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 28. Before developing your presentation, you need to determine the prospect to call on and make an appointment. Answer: True Learning Objective: 08-02 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Before developing your presentation, you need to determine the prospect or customer to call on, make an appointment, and then plan the sales call. Once the prospect and objective have been identified, it’s time to plan out and prepare the sales presentation itself. 29. The last step in planning your sales call is to develop a marketing plan for the prospect. Answer: False Learning Objective: 08-02 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The final step is planning a sales call is developing and rehearsing the sales presentation. Developing a marketing plan would occur earlier in the process. 30. With reference to the prospect's five mental steps in buying, the first step is the desire to buy the product. Answer: False Learning Objective: 08-04 Topic: The Prospect’s Mental Steps Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The first mental step is capturing and maintaining the prospect’s attention. This step may be difficult because the prospect may be distracted or lacking interest. Desire is the third mental step in buying.Chapter 08 - Planning the Sales Call Is a Must 8-10 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 31. A salesperson knows that a prospect’s desire for a product is solidified when the potential buyer asks a question about price. Answer: False Learning Objective: 08-04 Topic: The Prospect’s Mental Steps Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Asking questions about a product is a normal component of communication during a sales presentation. However, asking a question about price does not guarantee that a prospect will make a purchase. 32. Closing the sale can be the easiest step in the sales presentation if the previous steps have been followed well. Answer: True Learning Objective: 08-04 Topic: The Prospect’s Mental Steps Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Closing the sale is the easiest step in the sales presentation when the steps leading up to that point have been implemented correctly. 33. The FAB formula helps a salesperson increase a prospect’s desire for a product. Answer: True Learning Objective: 08-04 Topic: The Prospect’s Mental Steps Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Using the FAB formula, strive to bring prospects from lukewarm interest to a boiling desire for your product. Desire is created when prospects express a wish or wanting for a product like yours.Chapter 08 - Planning the Sales Call Is a Must 8-11 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 34. When a salesperson has determined that a prospect is in the desire stage of the mental buying process, then the salesperson should attempt to close. Answer: False Learning Objective: 08-04 Topic: The Prospect’s Mental Steps Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Uncovering and answering the prospect’s questions and revealing and meeting or overcoming objections results in more intense desire. This desire is transformed into the conviction that your product can fulfill the prospect’s needs or solve problems. Once you have determined that the prospect is in the conviction stage, you are ready for the close. 35. The five mental steps of buying in order are attention, interest, desire, conviction, and purchase. Answer: True Learning Objective: 08-04 Topic: The Prospect’s Mental Steps Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Attention, interest, desire, conviction, and purchase are the five mental steps a prospect goes through when making buying decisions. Multiple Choice Questions 36. According to the Golden Rule of Selling, your primary purpose for any sales call should be to: A. determine who has the authority and the ability to be a buyer. B. create a long-term relationship with all prospects. C. meet and provide help to a prospect. D. sell a product to every prospect. E. qualify leads efficiently. Answer: C Learning Objective: 08-01 Topic: The Golden Rule: Planning Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 08 - Planning the Sales Call Is a Must 8-12 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: You are meeting with a prospect with the purpose of helping him or her. Your purpose, plan, and goal do not center on selling but helping. 37. During the _____ stage, the salesperson plans the sales presentation. A. preapproach B. trial close C. follow-up D. approach E. value analysis Answer: A Learning Objective: 08-01 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Once the prospect has been located, or the salesperson determines which customer to call on, the salesperson is ready to plan the sales call. Planning is often referred to as the preapproach. 38. _____ is often referred to as the preapproach. A. Presentation B. Trial close C. Planning D. Targeting E. Evaluation Answer: C Learning Objective: 08-01 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Planning is often referred to as the preapproach. Once the prospect has been located, or the salesperson determines which customer to call on, the salesperson is ready to plan the sales call.Chapter 08 - Planning the Sales Call Is a Must 8-13 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 39. Which term refers to a formal relationship between a salesperson and a customer for the purpose of pursuing mutual goals? A. Transactional relationship B. Exchange-oriented dependency C. Symbiotic relationship D. Strategic customer relationship E. Joint decision-making alliance Answer: D Learning Objective: 08-01 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The purpose of a strategic customer relationship is the joint pursuit of mutual goals. Strategic goals for a customer typically include reducing costs and/or increasing productivity, sales, and profits. The sales organization has goals of increasing sales and profits. 40. Nordstrom, the fashion retailer, is installing software in its 137 stores that will help the company gather customer preferences and product information. The software will assist the store's salespeople to understand each customer as a person with unique wants and needs. Nordstrom is helping its salespeople create _____ with the store's customers. A. transactional relationships B. exchange-oriented dependency C. symbiotic relationships D. strategic customer relationships E. joint decision-making alliances Answer: D Learning Objective: 08-01 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The purpose of a strategic customer relationship is the joint pursuit of mutual goals. The Nordstrom system will help salespeople understand and meet the needs of customers, so both the seller and the customer benefit.Chapter 08 - Planning the Sales Call Is a Must 8-14 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 41. A(n) _____ has the ability to develop and combine nontraditional alternatives to meet the specific needs of the customer. A. tactical partner B. creative problem solver C. quick decision-maker D. transactional partner E. exchange innovator Answer: B Learning Objective: 08-01 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Remember Understand AACSB: Analytic Level of Difficulty: Easy Medium Explanation: Today’s salespeople need to be creative problem solvers who have the ability to develop and combine nontraditional alternatives to meet the specific needs of the customer. The better a salesperson is at creatively marshaling all available resources to address a customer’s strategic needs, the stronger the customer relationship becomes. 42. Lev Knossos sells high tech equipment and software to companies in Greece. When he first started selling to Greek businesses, he was told that the Greek market lagged behind others in the use of technology. After conducting research, Knossos visited the Commercial Bank of Greece and explained how his products could create Web pages for the bank and facilitate banking transactions. By applying his product knowledge to solve a technology issue that he identified, Knossos took the role of: A. tactical partner. B. creative problem solver. C. low-involvement decision maker. D. transactional partner. E. exchange creator. Answer: b Learning Objective: 08-01 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Today’s salespeople need to be creative problem solvers who have the ability to develop and combine nontraditional alternatives to meet the specific needs of the customer. Knossos was able to identify a problem and explain the benefits of his creative solution to the bank.Chapter 08 - Planning the Sales Call Is a Must 8-15 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 43. Jack, an office supply salesperson, recently called on a customer who was trying to select photos to include in a catalog. The customer wanted to look at the 10 photos side-by-side for comparison, but his easel was too small and the cinderblock walls in the office would not hold tacks or tape. The customer explained that the situation was a regular issue for him. Jack obtained a roll of cork and a can of cork glue to convert an office wall into a giant bulletin board. In this instance, Jack acted as a(n): A. tactical partner. B. creative problem solver. C. low-involvement decision maker. D. transactional partner. E. exchange creator. Answer: B Learning Objective: 08-01 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Today’s salespeople need to be creative problem solvers who have the ability to develop and combine nontraditional alternatives to meet the specific needs of the customer. Jack was able to creatively marshal his resources to address a customer’s strategic needs, which most likely strengthened the customer relationship. 44. All of the following hold true of the customer relationship model EXCEPT: A. it requires consultative selling. B. a buyer's strategic needs are linked to a salesperson's creative solutions. C. the relationship is expected to be short-term. D. the relationship must be mutually beneficial for the buyer and the seller. E. both customers and sellers accomplish their goals. Answer: C Learning Objective: 08-01 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The customer relationship model brings together the main elements of consultative selling and shows that customers have strategic needs that salespeople must meet through creative solutions, which benefits both buyers and sellers. This results in the seller being able to sell the customer again and again and building a long-term relationship.Chapter 08 - Planning the Sales Call Is a Must 8-16 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 45. Which of the following is the most likely reason that salespeople plan their sales calls? A. Shortening the sales presentation B. Overcoming customer objections C. Establishing professionalism D. Utilizing new technologies E. Training new employees Answer: C Learning Objective: 08-01 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Numerous reasons for planning the sales call including the fact that planning reflects professionalism. Objections cannot be eliminated from a sales call, although planning may address many of them. 46. Aaron is nervous about going on his first sales call. Which of the following would be the best advice to give Aaron? A. "Ignore customer objections." B. "Focus only on the competition." C. "Carefully plan and rehearse the sales call." D. "Encourage the customer to buy the product even if it’s not needed.‖ E. "Schedule the length of each sales call to be no more than 30 minutes." Answer: C Learning Objective: 08-01 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Aaron could reduce his nervousness and increase self-confidence by planning and practicing the sales presentation. 47. A salesperson engaged in sales call planning should: A. create flexible sales call objectives. B. develop a customer benefit plan. C. conduct vendor analyses. D. join a sales lead club. E. use e-prospecting. Answer: B Learning Objective: 08-02 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Remember AACSB: Analytic Level of Difficulty: EasyChapter 08 - Planning the Sales Call Is a Must 8-17 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: A component of planning a sales call is to develop a customer benefit profile. The other steps include identifying call objectives, developing a customer profile, and creating a sales presentation. 48. The four components of sales call planning, in their correct order, are: A. customer profile, sales call objective, sales presentation, sales benefit. B. sales call objective, customer profile, customer benefit plan, and sales presentation. C. customer profile, sales call objective, customer benefit plan, and sales presentation. D. sales call objective, customer benefit plan, customer profile, and sales presentation. E. customer preapproach, customer profile, customer sales call objective, and sales presentation. Answer: B Learning Objective: 08-02 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The first step of sales call planning is identifying sales call objectives. Developing a customer profile, reviewing customer benefits, and creating a sales presentation are the next steps. 49. Which of the following is a component of sales call planning? A. Forecasting long-term sales and profits B. Analyzing vendors of the customer C. Developing the customer profile D. Perceptual mapping E. Market testing Answer: C Learning Objective: 08-02 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The first step of sales call planning is identifying sales call objectives. Developing a customer profile, reviewing customer benefits, and creating a sales presentation are the next steps. 50. Which term refers to the main purpose of a salesperson's contact with a prospect? A. Sales call objective B. Sales mission C. Organization profile D. Marketing goal E. Corporate mission Answer: A Learning Objective: 08-02Chapter 08 - Planning the Sales Call Is a Must 8-18 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The main purpose of contacting a prospect is known as the sales call objective. Identifying the objective is the first step in the sales call planning process. 51. Which of the following statements about sales call objectives is true? A. Sales call objectives should primarily benefit the salesperson. B. A sales call objective is only necessary when making formal presentations. C. A customer profile must be developed before making a sales call objective. D. The sales call objective is the main purpose of a salesperson's contact with a prospect. E. A sales call objective is usually too complex to modify once a sales call has developed. Answer: D Learning Objective: 08-02 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The main purpose of a sales call is the objective, which should benefit the customer rather than the salesperson. Such objectives are essential both for sales presentations and less formal visits with a customer. 52. A sales call objective: A. reduces the flexibility of the presentation. B. always needs elaborate planning. C. reduces the focus of a sales persons efforts. D. cannot be changed once fixed. E. needs to be as specific as possible. Answer: E Learning Objective: 08-02 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 08 - Planning the Sales Call Is a Must 8-19 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: The more specific the sales call objective, the better. Sales call objectives can be modified if it is not appropriate. 53. Garth sells spray booths for repainting vehicles to shops that repair wrecked vehicles. The spray booths are used for painting cars and trucks and come in a variety of sizes. The spray booths are used to contain the paint and to protect the car surface while the paint is drying. When Garth called on Elwood Body Shop, his _____ was to sell the body shop owner one of his company's taller spray booths designed for trucks. A. selling proposition B. marketing plan C. sales call objective D. FAB plan E. customer profile goal Answer: C Learning Objective: 08-02 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The main purpose of contacting a prospect is known as the sales call objective. Identifying the objective is the first step in the sales call planning process. Garth’s objective was to sell spray booths. 54. What is most likely needed in order to develop a customer benefit plan? A. Rehearsed preapproach B. Industry practicees C. Customer profile D. Client referrals E. Marketing strategy Answer: C Learning Objective: 08-02 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A sales objective and a customer profile are needed before a salesperson can develop a customer benefit plan. These are components of preapproach. 55. Which of the following statements is most likely true? A. Selling is a highly complex process. B. Selling is easy to do on a consistent basis. C. A sales call must move systematically toward a sale. D. Selling begins with negating a precall sales objective. E. Elaborate planning is necessary before making a sales call. Answer: CChapter 08 - Planning the Sales Call Is a Must 8-20 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Learning Objective: 08-02 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: By definition, a sales call must move systematically toward a sale, but it doesn’t necessarily involve elaborate planning. Selling is not complex, but it is difficult to be successful consistently. 56. Monty sells safety equipment to law enforcement agencies. Before calling on the Humphrey Sheriff's Department, he decided that he wanted to get an order for eight new bulletproof vests from the sheriff before he left the office. In terms of the acronym SMART, Monty's objective: A. had a targeted rate of return. B. was specific. C. was to put customer service first. D. was flexible. E. had reasonable attention to detail. Answer: B Learning Objective: 08-02 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Monty’s goal to sell eight vests before leaving is very specific and detailed. 57. In a SMART sales call objective, the "A" and "M" refer to the fact that the objective should be: A. accurate and maximized. B. achievable and minimum possible. C. actionable and motivating. D. achievable and measurable. E. accurate and motivating. Answer: D Learning Objective: 08-02 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: SMART sales call objectives are specific, measurable, achievable, realistic, and timed.Chapter 08 - Planning the Sales Call Is a Must 8-21 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 58. In a SMART sales call objective, the "T" refers to the fact that the objective should: A. be timed. B. have a technical-orientation. C. be tested. D. have a targeted rate of return. E. describe trade areas. Answer: A Learning Objective: 08-02 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: SMART sales call objectives are specific, measurable, achievable, realistic, and timed. The salesperson should identify when the objective will be accomplished. 59. Avi sells paint to shops that repair wrecked vehicles. When Avi called on Elwood Body Shop, he wanted to sell the body shop owner six cases of his company's base coating paint. In terms of the acronym SMART, Avi's objective: A. could not be measured. B. was not readily achievable. C. did not have a valid order size. D. was missing the time component. E. met all call objective requirements. Answer: D Learning Objective: 08-02 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: SMART sales call objectives are specific, measurable, achievable, realistic, and timed. Avi’s objective failed to identify when the goal of selling six cases would be accomplished. 60. Sasha sells how-to books and is going on a sales call to a local bookstore. Sasha knows the purchasing policies of the store, the person responsible for buying decisions, and the financial terms required by the store. Such information can be found in Sasha’s: A. sales call objective. B. marketing plan. C. competitive portfolio. D. customer profile. E. business proposition. Answer: D Learning Objective: 08-02 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: UnderstandChapter 08 - Planning the Sales Call Is a Must 8-22 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Medium Explanation: A customer profile sheet should include as much relevant information as possible regarding the firm, the buyer, and the individuals who influence the buying decision to properly develop a customized presentation. 61. Barry sells mailing lists for a direct marketing company. He is interested in selling a mailing list to the publisher of a magazine devoted to new electronic products. Barry has learned he will not be able to close the sale until he has met the publisher's circulation vice president. This sort of information would be found in the _____ Barry created. A. sales call objective B. marketing plan C. competitive portfolio D. customer profile sheet E. strategic business proposition Answer: D Learning Objective: 08-02 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A customer profile sheet should include as much relevant information as possible regarding the firm, the buyer, and the individuals who influence the buying decision to properly develop a customized presentation. 62. A _____ would answer questions such as "What is the buyer's background?" and "What are the company's purchasing policies?" A. sales call objective B. company's marketing plan C. competitive portfolio D. customer profile E. business proposition Answer: D Learning Objective: 08-02 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Remember AACSB: Analytic Level of Difficulty: EasyChapter 08 - Planning the Sales Call Is a Must 8-23 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: A customer profile sheet should include as much relevant information as possible regarding the firm, the buyer, and the individuals who influence the buying decision to properly develop a customized presentation. It should cover the buyer’s background and company policies. 63. What is the primary purpose of developing a customer profile sheet? A. Understanding the structure of the company's buying center B. Identifying the best strategy to use in a sales call C. Narrowing the objective of the sales call D. Using visual aids in a sales presentation E. Developing rapport with the prospect Answer: B Learning Objective: 08-02 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Analyze AACSB: Analytic Level of Difficulty: Hard Explanation: A customer profile sheet can be a guide for determining the appropriate strategy to use in contacting each customer. The salesperson should review as much relevant information as possible regarding the firm, the buyer, and individuals who influence buying decisions in order to develop a customized presentation. 64. The salesperson’s _____ contains the central information provided in the sales presentation. A. customer benefit plan B. sales call objective C. customer profile D. marketing plan E. business proposition Answer: A Learning Objective: 08-03 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The customer benefit plan contains the nucleus of the information used in your sales presentation and includes the features, advantages, and benefits of your product. 65. What is the first step in developing a customer benefit plan? A. Establishing a marketing plan B. Creating a detailed customer profile C. Selecting a suggested purchase order for a prospect D. Developing a business proposition that includes a value analysis E. Choosing the features, advantages, and benefits to present to a prospect Answer: EChapter 08 - Planning the Sales Call Is a Must 8-24 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Learning Objective: 08-03 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The first step in creating a customer benefit plan is selecting the features, advantages, and benefits of your product to present to your prospect. Developing a market plan, a business proposition, and a suggested purchase order are the next three steps in the process. 66. What is the second step in developing a customer benefit plan? A. Identifying benefits B. Creating a marketing plan C. Establishing a sales call objective D. Developing a business proposition E. Customizing a purchase order plan Answer: B Learning Objective: 08-03 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The second step in developing a customer benefit plan is to create a marketing plan. The third step is developing a business proposition, and the fourth is developing a suggested purchase order. 67. Which component of a customer benefit plan most likely includes price, percent markup, and ROI? A. Customized marketing plan B. Business proposition C. Sales call objective D. Customer profile E. Purchase order Answer: B Learning Objective: 08-03 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 08 - Planning the Sales Call Is a Must 8-25 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: The third step in developing a customer benefit plan involves creating a business proposition. This component includes items such as price, percent markup, forecasted profit per square foot of shelf space, return on investment, and payment plan. 68. The first three steps involved in developing the customer benefit plan, in their correct order, are: A. developing marketing plan, selecting FAB, and developing business proposition. B. developing benefits, developing business proposition, and developing marketing plan. C. developing marketing plan, developing business proposition, and closing the sale. D. selecting FAB, developing marketing plan, and developing business proposition. E. developing business proposition, developing marketing plan, and closing the sale. Answer: D Learning Objective: 08-03 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The first step in creating a customer benefit plan is selecting the features, advantages, and benefits of your product to present to your prospect. Developing a market plan, a business proposition, and a suggested purchase order are the next three steps in the process. 69. A marketing plan for a retailer should most likely include how to: A. identify benefits. B. utilize the SELL sequence. C. promote a specific product. D. evaluate return on investment. E. present a customer needs analysis. Answer: C Learning Objective: 08-03 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: An effective marketing plan includes suggestions on how a retailer should ―promote‖ the product through displays, advertising, proper shelf space and positioning, and pricing.Chapter 08 - Planning the Sales Call Is a Must 8-26 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 70. Tatum is a sales representative a gourmet cookware manufacturer. Tatum’s marketing plan for a store that would be a logical retail outlet for her products should include: A. how ultimate consumers should correctly dispose of old kitchen tools. B. how the retailer can adopt and facilitate the role of end-user. C. how the reseller will promote the cookware once purchased. D. the business proposition which the retailer will adhere to. E. a purchase order based on a seller benefit plan. Answer: C Learning Objective: 08-03 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: An effective marketing plan includes suggestions on how a retailer should promote the product through displays, advertising, proper shelf space and positioning, and pricing. 71. What is the final step in developing a customer benefit plan? A. Performing a value analysis that identifies ROI B. Assessing the prospect’s attitude with a trial close C. Creating an individualized sales call objective D. Developing a suggested purchase order E. Presenting a marketing plan Answer: D Learning Objective: 08-03 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The last step in the process is developing a suggested purchase order based on a customer benefit plan. A proper presentation of your customer needs analysis and your product’s ability to fulfill these needs, along with a satisfactory business proposition and marketing plan, allows you to justify to the prospect what product and/or how much to purchase.Chapter 08 - Planning the Sales Call Is a Must 8-27 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 72. A marketing plan created for an end-user most likely addresses: A. the business proposition. B. forecasted profit and ROI. C. how the product can be used. D. how a reseller will sell the product once purchased. E. the promotional options available for selling the product. Answer: C Learning Objective: 08-03 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: For an end user of the product, such as the company that buys your manufacturing equipment, computer, or photocopier, develop a program showing how your product is most effectively used or coordinated with existing equipment. 73. Annette sells store fixtures such as clothing racks, wall shelving, and storage units. In developing her _____ for a prospect, Annette uses the square footage of the prospect’s retail store to predict profit as well as return on investment if her fixtures are purchased. A. sales call objective B. marketing call C. customer profile D. FAB E. business proposition Answer: E Learning Objective: 08-03 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A business proposition includes items such as price, percent markup, forecasted profit per square foot of shelf space, return on investment, and payment plan.Chapter 08 - Planning the Sales Call Is a Must 8-28 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 74. Which of the following is an example of a topic discussed in the business proposition segment of a sales presentation for a reseller? A. Demonstrations B. Guarantees C. Maintenance/service D. Value analysis E. Discounts Answer: E Learning Objective: 08-03 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Discounts, markup, profit, and list price are topics addressed in the business proposition for resellers. A value analysis would be in a business proposition to end users. 75. A suggested purchase order would most likely include all of the following information about a product EXCEPT: A. type. B. quantity. C. assortment. D. promotion ideas. E. shipment details. Answer: D Learning Objective: 08-03 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The last step in creating a customer benefit plan is developing a suggested purchase order. This suggestion may include, depending on the product, such things as what to buy, how much to buy, what assortment to buy, and when to ship the product to the customer. Promotion ideas would be included in a marketing plan. 76. Which of the following would most likely occur in the approach phase of a sales presentation? A. Describing features, advantages, and benefits B. Asking for the prospect’s business C. Explaining product usage D. Building rapport E. Reselling Answer: D Learning Objective: 08-03 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: UnderstandChapter 08 - Planning the Sales Call Is a Must 8-29 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Medium Explanation: During the approach phase of a sales presentation, a salesperson would build rapport with the prospect and then transition into the sales presentation. During the presentation, the salesperson would discuss product features and usage and eventually ask for the business. 77. The _____ can be used to move prospects from mild interest to strong desire for a product. A. interactive method B. SELL sequence C. business proposition D. FAB formula E. action enhancement method Answer: D Learning Objective: 08-04 Topic: The Prospect’s Mental Steps Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A salesperson can use the FAB formula to bring prospects from lukewarm interest to a boiling desire for a product. Desire is created when prospects express a wish or wanting for a product like yours. 78. A salesperson's prospects go through several mental steps in deciding whether to buy or not to buy the product. Select these steps in their correct order. A. Interest, attention, desire, purchase, action. B. Interest, desire, attention, conviction, purchase. C. Attention, interest, desire, conviction, purchase. D. Desire, attention, interest, conviction, purchase, action. E. Attention, conviction, interest, desire, action, purchase. Answer: C Learning Objective: 08-04 Topic: The Prospect’s Mental Steps Blooms: Remember AACSB: Analytic Level of Difficulty: EasyChapter 08 - Planning the Sales Call Is a Must 8-30 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: The first mental step of buying is the attention phase. Interest, desire, conviction, and purchase are the next four steps in order. 79. As a salesperson for a restaurant equipment supplier, you have decided to call on Frederick Hawkins, the owner of Fred's House of Pancakes. If Frederick decides to discuss your products then he is most likely in the ________ stage of the buying decision. A. attention B. conviction C. purchase D. interest E. desire Answer: D Learning Objective: 08-04 Topic: The Prospect’s Mental Steps Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Prospects enter the interest stage if they listen to and enter into a discussion with you. If Frederick expressed a wish to have a product like the one being discussed, then Frederick would be in the desire stage. 80. A prospect goes through five mental steps, all of which lead to the purchase decision. The approach stage of the selling process should: A. move the prospect to the conviction stage. B. attract customer attention and interest. C. make the customer desire the product. D. get the customer to take some action. E. handle initial objections. Answer: B Learning Objective: 08-04 Topic: The Prospect’s Mental Steps Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 08 - Planning the Sales Call Is a Must 8-31 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Grabbing customer attention is an element of the approach phase of a sales presentation and also the first mental step in the buyer’s purchasing decision. A salesperson must first capture the attention of the prospect so that the prospect will listen to the sales presentation. 81. In which of the mental steps does the prospect decide he should buy from you because there are no remaining doubts in his mind? A. Conviction B. Acceptance C. Desire D. Purchase E. Action Answer: A Learning Objective: 08-04 Topic: The Prospect’s Mental Steps Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Conviction is established when no doubts remain about purchasing the product from you. Desire is created when prospects express a wish or wanting for a product like yours, but doubts may still exist. 82. Gene sells ski clothing and is meeting with the retail buyer for a large ski resort. When the prospect says, "I've seen enough, Gene. There is no doubt in my mind that your company will provide our resort with the best quality ski clothes for the money," the prospect has reached the mental step called: A. action. B. interest. C. conviction. D. desire. E. purchase. Answer: C Learning Objective: 08-04 Topic: The Prospect’s Mental Steps Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Conviction is established when no doubts remain about purchasing the product from you. Desire is created when prospects express a wish or wanting for a product such as yours, but doubts may still exist.Chapter 08 - Planning the Sales Call Is a Must 8-32 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 83. Daniella sells furniture. After demonstrating her product and answering the customer's questions, Daniella asked the customer how many chairs he thought he could sell. The customer responded with, "Three dozen. How soon can you deliver?" Which mental step has the customer reached? A. Awareness B. Desire C. Attention D. Action E. Interest Answer: D Learning Objective: 08-04 Topic: The Prospect’s Mental Steps Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The prospect is convinced to buy the furniture and wants three dozen chairs delivered soon, so he has reached the action phase. Desire is created when prospects express a wish or wanting for a product such as yours, but doubts may still exist. 84. Adrian, who has just met his prospect, begins by telling an interesting story about the last customer who bought his product and benefited by it immediately. The prospect is initially interested but growing impatient. What should Adrian do? A. Discuss the ROI potential of the product B. Ask the prospect about his current needs C. Ask the prospect for additional referrals D. Tell another story about a satisfied client E. Ask the prospect to buy the product Answer: B Learning Objective: 08-04 Topic: The Prospect’s Mental Steps Blooms: Apply AACSB: Analytic Level of Difficulty: HardChapter 08 - Planning the Sales Call Is a Must 8-33 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Prospects enter the interest stage if they listen to and enter into a discussion with you. Before Adrian’s prospect loses more interest, Adrian should quickly strive to link his product’s benefits to the prospects’ needs. If this link is completed, prospects usually express a desire for the product. 85. In which of the prospect's mental steps would interruptions be most difficult for a salesperson to overcome? A. Interest B. Action C. Conviction D. Attention E. Desire Answer: D Learning Objective: 08-04 Topic: The Prospect’s Mental Steps Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The first mental step of buying is the attention phase. This step may be difficult at times for salespeople because of distractions, pressing demands on the prospect’s time, or lack of interest. Clearwater Hampers Clearwater Hampers is a small British company that sells luxury food and drink gifts in various combinations in picnic hampers. Corporate customers, both in the United Kingdom and abroad, are important to the business. Clearwater has had several orders for more than a quarter of a million dollars. According to the company's leading salesperson, Peter Austin, "We have lots of repeat corporate customers as a result of the importance we place on getting the hampers out on time and filled with the right products." 86. The fact that Clearwater Hampers has repeat corporate customers indicates that it most likely creates _____ with its customers. A. transactional relationships B. exchange-oriented dependencies C. symbiotic relationships D. strategic relationships E. joint decision-making alliances Answer: D Learning Objective: 08-01 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 08 - Planning the Sales Call Is a Must 8-34 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: A strategic relationship is a formal relationship between buyers and sellers in which both benefit. The customer reaches his or her goal, as does the seller. This results in the seller being able to sell the customer again and again and again—building a long-term relationship. 87. A corporate customer wanted to give similar Clearwater hampers to its customers who come from a variety of different ethnic backgrounds. The cultures of some clients disapprove of eating pork and drinking alcoholic beverages. This unique request would require Clearwater to act as a _____ so that each individual gift was culturally appropriate. A. tactical partner B. creative problem solver C. low-involvement decision maker D. transactional partner E. exchange creator Answer: B Learning Objective: 08-01 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Clearwater needs to tailor a custom solution for the customer to ensure that each recipient of a hamper receives one that is culturally appropriate. Clearwater’s salespeople need to be creative problem solvers who have the ability to develop and combine nontraditional alternatives to meet the specific needs of the customer. 88. In planning a preapproach for a multinational corporation, Peter Austin should first: A. consider the types of gifts used in the industry in which the prospect operates. B. develop customer features, advantages, and benefits. C. determine a sales call objective. D. conduct a vendor analysis. E. identify the buying center. Answer: C Learning Objective: 08-02 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The sales call objective is the main purpose of a salesperson’s contact with a prospect or customer, and it is the first decision Peter should make.Chapter 08 - Planning the Sales Call Is a Must 8-35 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 89. A _____ would provide Peter Austin with information about who makes the buying decisions for a prospective corporate customer, the buyer's background, and what kind of credit and delivery terms the account requires. A. customer profile B. FAB formula C. customer benefit plan D. value analysis E. SWOT analysis Answer: A Learning Objective: 08-02 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A customer profile includes information about the buyer’s history, any financial considerations of the account, and the individuals involved in making buying decisions. 90. Corporations in the _____ stage of the buying process would most likely have a strong belief that no other company provides better gifts than Clearwater Hampers. A. interest B. closing C. conviction D. benefit E. attention Answer: C Learning Objective: 08-04 Topic: The Prospect’s Mental Steps Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Conviction is established when no doubts remain about purchasing the product from Clearwater. Once the prospect is convinced, the salesperson should ask the prospect to make a purchase.Chapter 08 - Planning the Sales Call Is a Must 8-36 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Essay Questions 91. How do experienced salespeople guide the customer in the direction of a preplanned outcome? Provide examples of statements or questions that might accomplish this goal. Answer: Experienced salespeople guide the customer in the direction of a preplanned outcome with such simple questions as these: If we can meet the spec, can you set up a trial? How soon will the vice president be available to make a decision? Can you schedule a demonstration before the end of the month? Learning Objective: 08-02 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Apply AACSB: Analytic Level of Difficulty: Hard 92. What is the gap between sellers and buyers? How can the gap be bridged? Answer: Many people do not trust salespeople. There is a trust gap between seller and buyer. When the salesperson establishes trust by basing all his dealings on truth, the gap is bridged. Only through truth can trust be supported to bridge the gap between people—seller and buyer. Truth that is without distortion due to personal feelings or prejudices is the center pole supporting trust. Remove truth and the bridge collapses. There can be no long-term relationships between two parties without trust based upon truth. One lie, one misrepresentation, can lead to separation, even divorce between seller and buyer. Learning Objective: 08-01 Topic: The Golden Rule: Planning Blooms: Apply AACSB: Ethics Level of Difficulty: Hard 93. What skills and knowledge do salespeople need to be effective strategic problem solvers? Answer: They are able to uncover and understand the customer's strategic needs by gaining an in-depth knowledge of the customer's organization. They develop solutions that demonstrate a creative approach to addressing the customer's strategic needs in the most efficient and effective manner possible. They arrive at a mutually beneficial agreement. These key terms— strategic needs, creative solutions, and mutually beneficial agreements—are critical to strategic problem solving. Learning Objective: 08-01 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 08 - Planning the Sales Call Is a Must 8-37 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 94. Comment on the following statement: "Today's salespeople need to be creative problemsolvers." Answer: Today's salespeople need to be creative problem solvers to creatively marshal all available resources to address a customer's specific strategic needs. The ability to tailor a custom solution is critical. The salesperson needs to use creative problem solving to identify the specific solutions, which meet each customer's needs. Instead of one product, the salesperson often must create the solution from a combination of goods and services. The better the salesperson is at creative problem solving, the stronger the customer relationship becomes. Learning Objective: 08-01 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Analyze AACSB: Analytic Level of Difficulty: Hard 95. What is the customer relationship model? What are the implications of the model on salespeople? Answer: The customer relationship model brings together the main elements of consultative selling. It shows that customers have strategic needs that salespeople must meet through creative solutions. In doing so, both buyer and seller benefit. The customer reaches his or her goal, as does the seller. This results in the seller being able to sell the customer again and again and again—building a long-term relationship. Strategic customer sales planning is extremely important to the success of today’s salespeople. Learning Objective: 08-01 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Analyze AACSB: Analytic Level of Difficulty: Hard 96. List four reasons why a salesperson should carefully plan his/her sales call. Answer: Planning the sales call is the key to success. Salespeople say there are numerous reasons for planning the sales call, and four of the most frequently mentioned reasons are (1) planning aids in building confidence; (2) it develops an atmosphere of goodwill between the buyer and seller; (3) it reflects professionalism; and (4) it generally increases sales because the salesperson understands the buyer's needs. Learning Objective: 08-01 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 08 - Planning the Sales Call Is a Must 8-38 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 97. What are the four steps of sales call planning? Answer: The four components of sales call planning or preapproach are: (1) determining the sales call objective; (2) developing or reviewing the customer profile; (3) developing a customer benefit plan; and (4) developing the individual sales presentation based on the sales call objective, customer profile, and customer benefit plan. Learning Objective: 08-02 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 98. According to the text, when setting sales call objectives, the salesperson should think SMART. What do the letters in this acronym advice the salesperson to do? Answer: A SMART call objective consists of: S = have SPECIFIC objectives M = have MEASURABLE objectives A = have ACHIEVABLE objectives R = have REALISTIC objectives T = have TIMED objectives Learning Objective: 08-02 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Remember AACSB: Analytic Level of Difficulty: Easy 99. What are the four steps involved in creating a customer benefit plan? Answer: The customer benefit plan contains the nucleus of the information used in your sales presentation; thus, it should be developed to the best of your ability. Remember to consider the Golden Rule in your customer benefit plan by incorporating this four-step process: (1) Select the features, advantages, and benefits of your product to present to your prospect. (2) Develop your marketing plan. (3) Develop your business proposition. (4) Develop a suggested purchase order based on a customer benefit plan. Learning Objective: 08-03 Topic: Strategic Customer Sales Planning—The Preapproach Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 08 - Planning the Sales Call Is a Must 8-39 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 100. What are the mental steps that lead to a purchase decision from a prospect? As a salesperson, which one do you think would be the most difficult and which one would be the easiest? Why? Answer: The five steps are attention, interest, desire, conviction, and purchase. The most difficult is gaining the prospect’s attention because of distractions, pressing demands on the prospect’s time, or lack of interest. If each of the preceding steps has been implemented correctly, closing the sale is the easiest step in the sales presentation. Learning Objective: 08-04 Topic: The Prospect’s Mental Steps Blooms: Apply AACSB: Analytic Level of Difficulty: HardChapter 09 - Carefully Select Which Sales Presentation Method to Use 9-1 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Chapter 09 Carefully Select Which Sales Presentation Method to Use Learning Objectives: 09-01 State why you first select a sales presentation method and then select the approach. 09-02 Describe the different sales presentation methods, know their differences, and know the appropriate situation for using a particular method. 09-03 Better understand how to give a presentation to a group of prospects. 09-04 Understand why negotiations can be an important part of the presentation. 09-05 Be able to discuss the structure and contents of a sales presentation based on the parallel dimensions of selling. True / False Questions 1. According to the Golden Rule of Selling, the heart of the sales presentation is the salesperson's approach to the customer or prospect. Answer: False Learning Objective: 09-01 Topic: The Golden Rule: Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The heart of the sales presentation is the discussion of the product, marketing plan, and business proposition. The question is, ―To whom is the presentation being given?‖ Once this question is answered, the salesperson can choose the type of sales presentation method best suited to the prospect or customer. 2. According to the Golden Rule of Selling, the honesty of your sales presentation will convince people that you can be trusted. Answer: True Learning Objective: 09-01 Topic: The Golden Rule: Presentation Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: Honesty during a sales presentation conveys to a prospect that the salesperson can be trusted, which bridges the gap between buyer and seller. 3. The basic difference in the four sales presentation methods is the type of product being sold. Answer: False Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 09 - Carefully Select Which Sales Presentation Method to Use 9-2 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: The basic difference in the four methods is the percentage of the conversation controlled by the salesperson. In the more structured memorized and formula selling techniques, the salesperson normally has a monopoly on the conversation, whereas the less structured methods allow for greater buyer–seller interaction; both parties participate equally in the conversation. 4. A sales presentation involves a persuasive explanation of a business proposition. Answer: True Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The sales presentation involves a persuasive vocal and visual explanation of a business proposition. 5. Partnering selling generally is more structured, whereas transactional selling requires a more customized presentation. Answer: False Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Transactional selling generally is more structured, whereas partnering requires a more customized presentation, with relationship selling typically somewhere in between. 6. The third step in the sales process is the first step in sales presentation. Answer: True Learning Objective: 09-01 Topic: The Golden Rule: Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The approach is both the third step in the sales process and the first step in the sales presentation. The sales presentation is the fourth step in the sales process and the second step in the sales presentation process.Chapter 09 - Carefully Select Which Sales Presentation Method to Use 9-3 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 7. In the memorized sales presentation, the salesperson takes time initially to understand the prospect's needs. Answer: False Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The salesperson does 80 to 90 percent of the talking during a memorized sales presentation and only occasionally allows the prospect to respond to predetermined questions. The salesperson does not attempt to determine the prospect’s needs during the interview, but gives the same canned sales talk to all prospects. 8. The memorized sales presentation is effective when the product is technical. Answer: False Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The memorized method is impractical to use when selling technical products that require prospect input and discussion. In this method, the salesperson dominates the discussion. 9. A disadvantage of the memorized sales presentation is that it moves very slowly in most cases. Answer: False Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The memorized sales presentation proceeds quickly through the sales presentation to the close, requiring the salesperson to close or ask for the order several times, which may be interpreted by the prospect as high-pressure selling.Chapter 09 - Carefully Select Which Sales Presentation Method to Use 9-4 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 10. The memorized presentation is also called the persuasive selling presentation. Answer: False Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The formula presentation, often referred to as the persuasive selling presentation, is akin to the memorized method. However, the salesperson follows a less structured, general outline in making a presentation, allowing more flexibility and less direction. 11. The formula sales presentation is based on the assumption that similar prospects in similar situations can be approached with similar presentations. Answer: True Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The formula presentation is based on the assumption that similar prospects in similar situations can be approached with similar presentations. However, for the formula method to apply, the salesperson must first know something about the prospective buyer. 12. In the formula sales presentation, the prospect generally controls the conversation during the sales talk, especially at the beginning. Answer: False Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The salesperson rather than the prospect generally controls the conversation during the sales talk, especially at the beginning. 13. The formula presentation method is more structured compared to the canned sales presentation method. Answer: False Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 09 - Carefully Select Which Sales Presentation Method to Use 9-5 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: The formula presentation is similar to the memorized method. However, with the formula method, the salesperson follows a less structured, general outline in making a presentation, allowing more flexibility and less direction. 14. The formula selling approach is appropriate for straight rebuy situations, especially when selling consumer goods. Answer: True Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Straight rebuy situations, especially with consumer goods, lend themselves to the formula presentation method. Many prospects or customers buy because they are familiar with the salesperson’s company. 15. A disadvantage of the formula sales presentation is that its format often prevents information from being logically presented. Answer: False Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The formula sales method ensures that all information is presented logically. The method obtains its name from the salesperson using the attention, interest, desire, and action (AIDA) procedure of developing and giving the sales presentation. 16. In terms of the 10-step productive retail sales call developed by SmithKline Beecham Products, the presentation step includes answering questions and handling objections. Answer: False Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: SmithKline Beecham Products, a consumer goods manufacturer, has developed a sequence, or formula, for its salespeople to follow. The company refers to it as the 10-step productive retail sales call. Answering questions and handling objections are part of the close step not the presentation step.Chapter 09 - Carefully Select Which Sales Presentation Method to Use 9-6 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 17. The need-satisfaction sales presentation is highly structured. Answer: False Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The need-satisfaction presentation is different from the memorized and the formalized approach; it is designed as a flexible, interactive sales presentation. It is the most challenging and creative form of selling. 18. The need-satisfaction format is appropriate for selling industrial and technical goods. Answer: True Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The need-satisfaction format is especially suited to the sale of industrial and technical goods with stringent specifications and high price tags. 19. In the need-satisfaction sales presentation, the first 50 to 60 percent of the conversation time is referred to as the need awareness phase. Answer: False Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The first 50 to 60 percent of conversation time is referred to as the needdevelopment phase. This time is devoted to a discussion of the buyer’s needs.Chapter 09 - Carefully Select Which Sales Presentation Method to Use 9-7 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 20. The customer does most of the talking in the approach and presentation stages of the needsatisfaction method. Answer: True Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: During the approach and presentation stages of the need-satisfaction method, the customer dominates the conversation. The salesperson talks more in the closing stage. 21. The problem-solution sales presentation consists of six steps. It begins when the salesperson and the prospect agree on the problems that the buyer wants solved. Answer: False Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The problem-solution presentation involves six steps. However, the first step is convincing the prospect to allow the salesperson to conduct the analysis. The salesperson and prospect agree on the problem to solve in the third step. 22. The problem-solution method is best suited for selling insurance and similar financial products. Answer: True Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: In selling highly complex or technical products such as insurance, industrial equipment, accounting systems, office equipment, and computers, salespeople often are required to make several sales calls to develop a detailed analysis of a prospect’s needs. For this reason, the problem-solution method is best.Chapter 09 - Carefully Select Which Sales Presentation Method to Use 9-8 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 23. The problem-solution presentation method is structured in nature. Answer: False Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The problem–solution presentation is a flexible, customized approach involving an in-depth study of a prospect’s needs, and it requires a well-planned presentation. 24. The problem-solution sales presentation rarely requires multiple calls. Answer: False Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: When using the problem-solution presentation method, a salesperson always makes multiple calls to the buyer due to the complexity of the product, the negotiations, and the buyer’s needs. 25. When delivering a group presentation, the salesperson will find it necessary to be less structured when dealing with larger groups than when dealing with smaller groups. Answer: False Learning Objective: 09-03 Topic: The Group Presentation Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: The larger the group, the more structured your presentation. It would not work if everyone jumped in with feedback and ideas simultaneously, so a semblance of order has to be arranged. 26. When selling to a group, it is necessary to modify the ten step selling process by omitting the trial close step. Answer: False Learning Objective: 09-03 Topic: The Group Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: When selling to a group, the trial close remains part of the selling process. It is important to gather feedback from the group by asking questions.Chapter 09 - Carefully Select Which Sales Presentation Method to Use 9-9 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 27. Developing a proposal document that can serve as a script during the presentation is a part of the group presentation preparation. Answer: False Learning Objective: 09-03 Topic: The Group Presentation Blooms: Remember AACSB: Communication Level of Difficulty: Easy Explanation: During your presentation, do not read from the document. It is not the presentation; it is strictly a resource of facts to give your prospect after a decision is made. 28. For a group sales presentation, prices should be included in an appendix of the proposal document. Answer: False Learning Objective: 09-03 Topic: The Group Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The best way to present a proposal document is without prices because some people will go directly to the prices without reading through the document. In addition, prices tend to prejudice non–decision makers, who should not be concerned with prices. 29. Salespeople should always give a benefit summary at the conclusion of a group sales presentation. Answer: True Learning Objective: 09-03 Topic: The Group Presentation Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: At the end, summarize your proposal by giving a benefits summary: ―Here is what you will get if you accept my proposal.‖ Talk about how the benefits will address their specific problems. 30. Not all styles of sales presentation require the salesperson to be prepared to negotiate. Answer: False Learning Objective: 09-04 Topic: Negotiating So Everyone Wins Blooms: Remember AACSB: AnalyticChapter 09 - Carefully Select Which Sales Presentation Method to Use 9-10 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: No matter what type of presentation method you use, or whether you talk to one person or a group of people, you should always be prepared to negotiate. 31. The first discussion point in a sales presentation should address the features, advantages, and benefits that the prospect desires. Answer: True Learning Objective: 09-05 Topic: The Parallel Dimensions of Selling Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Discussing the features, advantages, and benefits of a product is the first action to take in a sales presentation according to the parallel dimensions of selling. 32. The number one asset of a strong negotiator is preparation. Answer: True Learning Objective: 09-04 Topic: Negotiating So Everyone Wins Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The key to strong negotiations is preparation. Review the competition as well as previous sales to the business. 33. The training usage phases progress from natural to awkward to conscious. Answer: False Learning Objective: 09-05 Topic: Practice and Time Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Many salespeople feel awkward at first. In the second phase of training usage, the salesperson consciously uses the training more and more, slowly becoming better at its application on the job. In the third phase of training usage, the new techniques become a natural part of the day-to-day job. 34. The key to selling and negotiating is to always seek a win-win solution in which both buyer and seller are happy. Answer: True Learning Objective: 09-04 Topic: Negotiating So Everyone Wins Blooms: Remember AACSB: AnalyticChapter 09 - Carefully Select Which Sales Presentation Method to Use 9-11 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: The successful resolution of a negotiation starts with a commitment to do business together. It is then necessary for both parties to maintain common interests and resolve any conflicts cooperatively. The key to selling and negotiating is to always seek a win–win solution for buyers and sellers. 35. The decision-making criteria revolve around usually three levels of desire: must have, should have, and would be nice to have. Answer: True Learning Objective: 09-04 Topic: Negotiating So Everyone Wins Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Every purchase is made with decision-making criteria in mind, either consciously or subconsciously. Find out what they are for your prospect and the prospect’s company. Within those criteria, there are usually three levels of desire: must have, should have, and would be nice to have. Be clear about these levels and how they create limits for negotiations. Multiple Choice Questions 36. By definition, the _____ clearly and completely explains all aspects of a salesperson's proposition as it relates to a buyer's needs. A. preapproach B. display premise C. sales presentation D. trial close E. benefit close Answer: C Learning Objective: 09-01 Topic: The Golden Rule: Presentation Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: According to the text, an effective sales presentation completely and clearly explains all aspects of a salesperson’s proposition as it relates to a buyer’s needs. 37. Why should a salesperson first select a sales presentation method and then the approach? A. The sales presentation method is unimportant. B. The sales approach is the last step in a sales presentation. C. The salesperson can integrate trial closes into the approach. D. The sales presentation method determines how to open the presentation. E. A good sales presentation can compensate for a poor sales approach method. Answer: DChapter 09 - Carefully Select Which Sales Presentation Method to Use 9-12 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Learning Objective: 09-01 Topic: Select the Presentation Method, Then the Approach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Once you select the presentation method for a specific prospect or customer, it is time to determine how to open or begin the sales presentation. The sales opener, or approach, as shown is the first major step in the sales presentation. 38. _____ occurs when the salesperson brings company resource people to discuss a major problem or opportunity. A. Educational selling B. Need-satisfaction selling C. Seminar selling D. Conference selling E. Empowerment selling Answer: D Learning Objective: 09-02 Topic: Sales Presentation Strategy Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Conference selling involves the salesperson bringing company resource people to discuss a major problem or opportunity. With seminar selling, a company team conducts an educational seminar for the customer company about state-of-the-art developments. 39. What is the primary factor that differentiates the four sales presentation methods? A. Type of customer B. Number of decision-makers C. Type and cost of product or service D. Measurability of the sales call objective E. Amount of communication controlled by the salesperson Answer: E Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The basic difference in the four methods is the percentage of the conversation controlled by the salesperson. More interaction occurs in less structured methods, but in all cases, the salesperson talks more during closing since that is when the salesperson is trying to make a sale.Chapter 09 - Carefully Select Which Sales Presentation Method to Use 9-13 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 40. The salesperson typically monopolizes the conversation during _____ and _____ sales presentations. A. memorized; formula B. transactional; memorized C. memorized; need-satisfaction D. modified rebuy; straight rebuy E. memorized; stimulus-response Answer: A Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: In the more structured memorized and formula selling techniques, the salesperson normally has a monopoly on the conversation, whereas the less structured methods allow for greater buyer–seller interaction; both parties participate equally in the conversation. 41. Anna Reyes has selected a selling technique in which she has more control over the conversation between buyer and seller than with any other sales presentation method. What technique is Anna most likely using? A. Professional B. Memorized C. Need-satisfaction D. Barrier E. Problem-solution Answer: B Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Memorized selling is the most structured type because the salesperson gives a canned speech and little interaction occurs. Need-satisfaction and problem-solution methods encourage more interaction with the buyer.Chapter 09 - Carefully Select Which Sales Presentation Method to Use 9-14 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 42. When compared to other types of sales presentations, memorized selling is the: A. least structured. B. most interactive. C. least used in telemarketing. D. most used in technical sales. E. most structured. Answer: E Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Memorized selling is the most structured type because the salesperson gives a canned speech and little interaction occurs. Formula selling is slightly less structured than memorized. 43. Donna is planning her first Pampered Chef party during which she will try to sell the company’s cooking utensils and gadgets. Donna is new to sales and feels nervous about the sales presentation. Which of the following methods would be best for Donna? A. Formula B. Memorized C. Customized D. Problem-solution E. Need-satisfaction Answer: B Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: The memorized approach is best when the product is simple, time is limited, and the salesperson is inexperienced. Having a memorized presentation will most likely give Donna some confidence and reduce her nervousness. 44. Which of the following is a semi-structure method of sales presentation? A. Seminar B. Formula C. Memorized D. Need-satisfaction E. Problem-solution Answer: B Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Remember AACSB: AnalyticChapter 09 - Carefully Select Which Sales Presentation Method to Use 9-15 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: The salesperson follows a semi-structured, general outline in making a presentation, allowing more flexibility and less direction than the highly structured memorized method. 45. Which of the following is an advantage of using a memorized sales presentation? A. It ensures that the company's salespeople provide the same information to all customers. B. It has a problem solving orientation that ensures customized benefits. C. It is flexible and adapts readily to long or short presentation times. D. It keeps prospect participation at a minimum. E. It can be used for highly technical products. Answer: A Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: All salespeople present the same information in the same way, which is beneficial. However, the method offers little customer participation and presents benefits that may not be important to all customers. 46. Which of the following is a disadvantage of the memorized sales presentation? A. The difficulty involved in preparing and using the memorized sales presentation often frightens inexperienced salespeople. B. The memorized sales presentation presents features, advantages, and benefits that may not be important to the buyer. C. Salespeople are often disorganized when they use the memorized sales presentation. D. The memorized sales presentation is not effective when selling time is short. E. The memorized sales presentation includes too much prospect participation. Answer: B Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The memorized method offers little customer participation and presents benefits that may or may not be important to all customers. However, the method boosts the confidence of new salespeople and is best when time is limited.Chapter 09 - Carefully Select Which Sales Presentation Method to Use 9-16 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 47. Which of the following is characteristic of the memorized sales presentation? A. Requires prior contact with buyer B. Perceived as high pressure selling C. Used for multi-day presentations D. Lacks structure and organization E. Opens with questions to prospect Answer: B Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The memorized method is often perceived as a high-pressure sales approach. No prior contact with the buyer is necessary for the brief, structured presentation. 48. The formula presentation is often referred to as the _____ presentation. A. modified rebuy B. memorized C. persuasive selling D. transactional E. need-development Answer: C Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The formula presentation, often referred to as the persuasive selling presentation, is similar to the memorized method but less structured. 49. Which presentation method is based on the assumption that similar prospects in similar situations can be approached with similar presentations? A. Persuasive selling B. Problem-solution C. Need-satisfaction D. Relationship E. AIDA Answer: A Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Remember AACSB: AnalyticChapter 09 - Carefully Select Which Sales Presentation Method to Use 9-17 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: The formula presentation, often referred to as the persuasive selling presentation, is akin to the memorized method: It is based on the assumption that similar prospects in similar situations can be approached with similar presentations. 50. Which of these statements about formula presentations is true? A. The formula presentation is based on the SPIN procedure of developing and giving the sales presentation. B. New-task buying situations are a good time to use the formula presentation method. C. An advantage of the formula presentation is that it is most adaptable to complex selling situations. D. Customers get the greatest amount of talking time at the beginning of the formula sales presentation. E. To successfully use the formula sales presentation method, the salesperson must have previously identified the prospect's needs and wants. Answer: E Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Formula selling is effective for calling on customers who currently buy and for prospects about whose operations the salesperson has learned a great deal. The method involves the use of the AIDA procedure and is not very useful for complex selling situations. 51. The AIDA procedure is most closely related to the _____ method of sales presentation. A. persuasive selling B. problem-solution C. need-satisfaction D. straight rebuy E. memorized Answer: A Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The formula selling approach, which is also known as the persuasive selling presentation, obtains its name from the salesperson using the attention, interest, desire, and action (AIDA) procedure of developing and giving the sales presentation.Chapter 09 - Carefully Select Which Sales Presentation Method to Use 9-18 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 52. In the formula selling method, customer talking time peaks during: A. the approach stage. B. prospecting. C. the presentation stage. D. negotiation and close. E. preapproach. Answer: C Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: During the presentation stage of a formula sales presentation, customer talking time is at its greatest. The salesperson talks more during the approach and close stages. 53. Which of the following statements describes an advantage associated with the formula sales presentation? A. It reduces anxiety and nervousness for new salespeople. B. It requires little prospect participation or interaction. C. It is best for selling technical products that require prospect input. D. It ensures that all sales information is presented logically. E. It is effective when the selling time is very brief. Answer: D Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The formula sales presentation approach is flexible enough to allow prospect input and participation but structured enough so that information flows logically. 54. Which statement about the formula sales presentation is INCORRECT? A. The formula sales presentation is based on the AIDA procedure of developing and giving the sales presentation. B. Modified rebuy situations are a good time to use the formula sales presentation method. C. The formula sales presentation is the best method to use when the prospect allows a few minutes for the presentation. D. The customer has the largest amount of talking time during the latter half of the presentation phase of the formula sales presentation. E. To successfully use the formula sales presentation method, the salesperson must have previously identified the prospect's needs and wants. Answer: C Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One CarefullyChapter 09 - Carefully Select Which Sales Presentation Method to Use 9-19 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The memorized method is best when only a few minutes are available, but the formula method typically requires a half-hour. The method is based on the AIDA procedure and is best in rebuy situations with familiar customers. 55. Which of the following is the problem associated with using the formula sales approach without knowing customers' needs? A. It will reduce the buyer-seller interaction and make the job difficult for the salesperson. B. The customer will raise objections only at the closing stage and complicate the sale. C. The salesperson cannot implement any trial closes with confidence. D. The customer may not respond to the salesperson’s questions. E. Customer objections may arise early in the presentation. Answer: E Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The formula presentation method allows for smooth handling of anticipated questions and objections. However, if the salesperson does not know a customer’s needs and uses a planned presentation, the customer will probably raise objections early in the presentation. 56. The _____ presentation is the most challenging and creative form of selling because it is designed to be interactive. A. formula B. stimulus-response C. need-satisfaction D. straight-rebuy E. problem-solution Answer: C Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The need-satisfaction presentation is different from the memorized and the formalized approach; it is designed as a flexible, interactive sales presentation. It is the most challenging and creative form of selling.Chapter 09 - Carefully Select Which Sales Presentation Method to Use 9-20 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 57. At the beginning of a presentation, a salesperson asks a catalog retailer, "What type of inventory management software would you like your company to use?" The salesperson is most likely starting a _____ presentation. A. transactional B. stimulus-response C. formula D. persuasive selling E. need-satisfaction Answer: E Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A salesperson typically starts a need-satisfaction presentation with a probing question such as ―What type of software would you like to use?‖ This opening starts a discussion of the prospect’s needs and also gives the salesperson an opportunity to determine whether any of the products being offered might be beneficial. 58. The need-satisfaction sales presentation has several phases. Which of the following presents those phases in the correct order? A. Need perception, need-comprehension, and need-satisfaction B. Need-realization, need-utilization, and need-development C. Need-utilization, need-fulfillment, and need-satisfaction D. Need-development, need-awareness, and need-fulfillment E. Need-comprehension, need-development, and need-satisfaction Answer: D Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The need-satisfaction approach moves from need-development, to needawareness, and then to need-fulfillment. 59. Which of the following is a major difference between the need-satisfaction method and the formula sales method? A. The formula sales method opens with questions to the prospect unlike the need-satisfaction method. B. The need-satisfaction method is better for repeat buyers than the formula approach. C. The need-satisfaction method is more flexible than the formula selling technique. D. The formula sales approach is less structured than the need-satisfaction approach. E. The formula method is more interactive than the need-satisfaction method. Answer: CChapter 09 - Carefully Select Which Sales Presentation Method to Use 9-21 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The need-satisfaction method is a flexible and creative sales presentation method that involves opening with questions to the prospect. The formula approach is more structured than the need-satisfaction method. 60. In a need-satisfaction presentation, the maximum amount of time is spent in the _____ phase. A. need-fulfillment B. need-awareness C. need-utilization D. need-development E. need-diffusion Answer: D Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Approximately 50 to 60 percent of conversation time is devoted to a discussion of the buyer’s needs. This discussion occurs in the need development phase. 61. During the _____ phase of the need-satisfaction sales presentation, the salesperson begins to take control of the conversation by restating the prospect's needs to clarify the situation. A. need-fulfillment B. need-awareness C. need-utilization D. need-feedback E. need-diffusion Answer: B Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Once aware of the prospect’s needs (the need-awareness phase), the salesperson begins to take control of the conversation by restating the prospect’s needs to clarify the situation. During the last stage of the presentation, the need-fulfillment (or need-satisfaction) phase, the salesperson shows how the product will satisfy mutual needs.Chapter 09 - Carefully Select Which Sales Presentation Method to Use 9-22 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 62. Gulf Technology manufactures platforms for deep sea oil rigs. Costs for the platforms can exceed $1 million. Which sales approach would a Gulf Technology salesperson most likely use? A. Persuasive selling B. Need-satisfaction C. Response-stimulus D. AIDA selling E. Participative Answer: B Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The need-satisfaction format is especially suited to the sale of industrial and technical goods with stringent specifications and high price tags. 63. The salesperson is using a need-satisfaction presentation. During the _____ phase, the salesperson will show how the product being sold will satisfy mutual needs. A. need-fulfillment B. need-awareness C. need-utilization D. need-development E. need-diffusion Answer: A Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: During the last stage of the presentation, the need-fulfillment (or need-satisfaction) phase, the salesperson shows how the product will satisfy mutual needs. The first part of the conversation is referred to as the need-development phase. 64. What is the most likely reason that some salespeople dislike the need-satisfaction sales presentation approach? A. The salesperson must give the prospect some control of the selling situation. B. The method is impractical for selling highly technical products. C. The salesperson must present unimportant benefits to the buyer. D. The approach requires the salesperson to close too quickly. E. The method allows very little prospect participation. Answer: A Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One CarefullyChapter 09 - Carefully Select Which Sales Presentation Method to Use 9-23 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Some salespeople are uncomfortable with the need-satisfaction approach because they feel less in control of the selling situation than with a canned or formula presentation. The first half of the presentation is turned over to the prospect to discuss needs, which can be uncomfortable to some salespeople. 65. Why is it best to exclude price from a proposal document created for a group presentation? A. Fees and charges will create group confusion. B. Prices charged by competitors are hard to obtain. C. Fluctuations in the economy prevent pricing accuracy. D. Shipping and handling fees are difficult to estimate. E. Price rather than the document will become the focus. Answer: E Learning Objective: 09-03 Topic: The Group Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The best way to present a proposal document is without prices. Some people will go directly to the prices without reading through the document. 66. Elisha Levi believes that a flexible, customized approach to selling is best when dealing with highly complex products. She typically performs an in-depth study of the prospect's needs before creating a well-planned presentation. Levi obviously favors the _____ presentation method. A. memorized B. stimulus response C. problem-solution D. need-satisfaction E. formula Answer: C Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: AnalyticChapter 09 - Carefully Select Which Sales Presentation Method to Use 9-24 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: The problem–solution presentation is a flexible, customized approach involving an in-depth study of a prospect’s needs, and it requires a well-planned presentation. The method is best for complex products and negotiations. 67. Which of the following products would most likely require a problem-solution sales presentation? A. Automobiles B. Cosmetics C. Corporate insurance D. Personal computers E. Home sound system Answer: C Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: Complex products or services, like corporate-wide insurance, require the problem-solution method. The need-satisfaction method would be best for surround sound systems in the home. 68. When selling highly complex or technical products, such as industrial equipment or accounting systems, salespeople often are required to make several sales calls to develop a detailed analysis of a prospect's needs. What kind of sales presentation would such a selling situation require? A. Technical-selling B. Persuasive selling C. Stimulus response D. Need-satisfaction E. Problem-solution Answer: E Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The problem–solution presentation is a flexible, customized approach involving an in-depth study of a prospect’s needs, and it requires a well-planned presentation. The method is best for complex products such as industrial equipment or accounting systems.Chapter 09 - Carefully Select Which Sales Presentation Method to Use 9-25 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 69. During the typical first step of the problem-solution presentation, a salesperson should: A. prepare the sales presentation based on previously gathered customer knowledge. B. convince the prospect to allow an analysis of the prospect's problem. C. reach a mutual agreement with the prospect on the nature of the problem. D. prepare a written problem-solution proposal for the prospect. E. show how the product will satisfy mutual needs. Answer: B Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The first step of the problem-solution method is convincing the prospect to allow the salesperson to conduct an analysis. After making an analysis, both parties agree on the problem and determine that the buyer wants a solution. A proposal is developed and then plans are made for a sales presentation. 70. Which of the following methods of sales presentation is more likely to be used when it is necessary to present the proposal to a group of individuals? A. Formula B. Memorized C. Problem-solution D. Influential E. Persuasive Answer: C Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Often, the problem–solution presentation is used when it is necessary to present the proposal to a group of individuals. The problem–solution presentation is a flexible, customized approach involving an in-depth study of a prospect’s needs, and it requires a wellplanned presentation. 71. The typical last step of the problem-solution sales presentation is to: A. make the sales presentation. B. propose follow-up activities. C. analyze the prospect's problem. D. prepare a written solution for the prospect's problem. E. agree with the prospect on the specific problem to address. Answer: A Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: RememberChapter 09 - Carefully Select Which Sales Presentation Method to Use 9-26 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Easy Explanation: The final step for the problem-solution approach is making the actual sales presentation. Prior to the presentation, the salesperson analyzed the problem and developed a proposal. 72. Robert, a sales representative for JBR International, is giving a group sales presentation. Robert has gone through the opening steps of establishing the credibility of JBR. What should Robert most likely do next? A. Provide an overview of the firm’s growth B. Use visual aids to discuss proposal specifics C. Discuss the price for implementing the proposal D. Gather input about the criteria for making a purchase E. Summarize the short-term and long-term benefits of the product Answer: D Learning Objective: 09-03 Topic: The Group Presentation Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: After establishing the credibility of your company by discussing its history and qualifications, involve the group in the presentation. The first thing to do is go around the room asking for everyone’s input into the decision-making criteria for making the purchase. 73. In the beginning of a group sales presentation, a salesperson should: A. explain how the FAB formula will be used in the presentation. B. provide every member of the group with a customer profile. C. give quality assurances and qualifications. D. ignore the group's behavioral style. E. summarize the marketing plan. Answer: C Learning Objective: 09-03 Topic: The Group Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Providing the group with the seller’s qualifications is important because it establishes credibility and shows company pride. The salesperson does not need to discuss the FAB formal or provide customer profiles.Chapter 09 - Carefully Select Which Sales Presentation Method to Use 9-27 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 74. Assuming that you are a salesperson making a group sales presentation, which of these statements is most likely true? A. The larger the group, the less structured your presentation must be. B. Avoid talking to any members of the group prior to the presentation. C. Establish your credibility in the early stage of the presentation. D. Prepare a written proposal document that includes prices. E. Omit trial closes from your presentation. Answer: C Learning Objective: 09-03 Topic: The Group Presentation Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: It is important for a salesperson to establish credibility before moving into the heart of the presentation. The group needs to feel that the seller is competent and experienced. 75. All of the following should be included in a proposal document EXCEPT: A. testimonials. B. data and statistics. C. product prices. D. criteria for success. E. solutions to specific problems. Answer: C Learning Objective: 09-03 Topic: The Group Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The proposal document should include customer testimonials, data, success criteria, and solutions to problems. It is best not to include prices to avoid price being the focus. 76. At the end of a group sales presentation, the salesperson should provide prospects with a(n): A. proposal document. B. summary of benefits. C. order form. D. service contract. E. price list. Answer: B Learning Objective: 09-03 Topic: The Group Presentation Blooms: Remember AACSB: AnalyticChapter 09 - Carefully Select Which Sales Presentation Method to Use 9-28 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: At the end of a sales presentation, summarize your proposal by giving a benefits summary. Talk about how the benefits will address their specific problems. 77. The most inexperienced negotiators use the _____ mode of negotiating. A. cooperative B. attitudinal C. competitive D. organizational E. personal Answer: C Learning Objective: 09-04 Topic: Negotiating So Everyone Wins Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: There are cooperative, competitive, attitudinal, organizational, and personal modes of negotiating. Most inexperienced negotiators operate in the competitive mode because they mistakenly think the shrewd businessperson is one who wins at the other’s expense. 78. What is the key to being a strong negotiator? A. Service B. Preparation C. Extroversion D. Good product features E. Oral communication skills Answer: B Learning Objective: 09-04 Topic: Negotiating So Everyone Wins Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The number one asset of a strong negotiator is preparation. During the planning phase, after completing a competition analysis, you know how your company compares with the competition for price, service, quality, reputation, and so on. This knowledge is important at negotiation time.Chapter 09 - Carefully Select Which Sales Presentation Method to Use 9-29 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 79. The four phases of negotiation are: A. planning, meeting, studying, and proposing. B. attention, interest, desire, and action. C. interest, desire, conviction, and buying. D. planning, proposing, reciprocating, and closing. E. planning, studying, sampling, and closing. Answer: A Learning Objective: 09-04 Topic: Negotiating So Everyone Wins Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Negotiation consists of four phases: planning, meeting with the prospect, studying the prospect’s business, and making a proposal. 80. All of the following would be potential bargaining chips for a salesperson during negotiations EXCEPT: A. price flexibility. B. training availability. C. extra services to offer. D. optional equipment to provide. E. products available from competitors. Answer: E Learning Objective: 09-04 Topic: Negotiating So Everyone Wins Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: During your preparation, review the various bargaining chips available to you, such as flexibility in price and items, training options, and extra services or equipment. The negotiation is about your product rather than the competitor’s. 81. A salesperson’s chosen presentation method and approach technique should most likely be based on which of the following? A. Delivery schedule B. Product and prospect C. Customer preference D. Interest and demand E. Group behavior Answer: B Learning Objective: 09-01 Topic: The Sales Presentation and Techniques Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 09 - Carefully Select Which Sales Presentation Method to Use 9-30 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Create a presentation that adapts to the buyer’s personality style. Choose your presentation method and then select your approach technique. This is based on your product and knowledge of the person and of the organization. 82. The key to selling and negotiating is seeking to: A. identify gatekeepers. B. create a win-win situation. C. provide all product information. D. generate profitable, one-time sales. E. understand significant group behaviors. Answer: B Learning Objective: 09-04 Topic: Negotiating So Everyone Wins Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The key to selling and negotiating is to always seek a win–win solution in which both buyer and seller are happy. The successful resolution of a negotiation starts with a commitment to do business together. It is then necessary for both parties to maintain common interests and resolve any conflicts cooperatively. 83. During the approach, it is best if a salesperson does all of the following EXCEPT: A. takes notes. B. makes eye contact. C. sits in the public space. D. provides a business card. E. uses the prospect’s name. Answer: C Learning Objective: 09-05 Topic: The Sales Presentation and Techniques Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: If possible, the salesperson should sit in the buyer’s personal space to observe nonverbal communication signals. Public space would be too far away. 84. The parallel dimensions of selling enable salespeople to: A. negotiate with new customers. B. compare sales presentation methods. C. adhere to the Golden Rule of Selling. D. create sales where there is no customer need. E. understand the interactions between each component. Answer: E Learning Objective: 09-05 Topic: The Parallel Dimensions of SellingChapter 09 - Carefully Select Which Sales Presentation Method to Use 9-31 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Top-performing salespeople use the parallel dimensions of selling to plan, create, and execute their presentations. The three dimensions of selling—discussion sequence, selling process, and buyer’s mental steps—interact, often at the same time, to form a specific sales presentation. 85. Which of the following correctly represent the discussion sequence in a sales presentation? A. Product discussion, presentation of marketing plan, explanation of business proposal, purchase suggestion, trial close, close, follow up. B. Approach, product discussion, marketing plan presentation, meeting objections, purchase suggestion. C. Approach, product discussion, marketing plan presentation, explain business proposal, meeting objections, purchase suggestion. D. Product discussion, presentation of marketing plan, explanation of business proposal, close. E. Attention, interest, desire, conviction, action. Answer: D Learning Objective: 09-05 Topic: The Parallel Dimensions of Selling Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The discussion sequence consists of discussing the product, presenting the marketing plan, explaining the business proposition, and closing. 86. If a prospect chooses not to purchase a salesperson’s product, the salesperson should most likely: A. leave quickly. B. ask the reasons why. C. attempt to re-negotiate. D. revise the marketing plan. E. request additional referrals. Answer: B Learning Objective: 09-05 Topic: The Sales Presentation and Techniques Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Should the person not buy, do not take it personally. Try to discover why before leaving. This helps you prepare for your return visit. However, chances are the reason for not buying will come out in your presentation.Chapter 09 - Carefully Select Which Sales Presentation Method to Use 9-32 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Stage Technologies Stage Technologies is a London-based company that supplies engineering solutions for the entertainment industry. The company installs winches, stage lifts, and other equipment commonly used in stage productions. The equipment is designed so it can be operated from a single console without awkward or heavy lifting. Both opera companies and theaters see the benefit of such a system, but many are reluctant to buy because of perceived costs. John Hastie and Mark Ager, the company's best salespeople, must design sales presentations that address these concerns. 87. Hastie and Ager would most likely use the formula presentation approach when: A. working with a prospect who has limited time. B. selling to a veteran stage production manager. C. making a proposal to a committee. D. dealing with a rebuy situation. E. negotiating with a manager. Answer: D Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: Straight rebuy situations lend themselves to the formula sales method. Many prospects or customers buy because they are familiar with the salesperson’s company. 88. Imagine Hastie walked into a prospect's office and asked, "How would you like to increase rehearsal time and ensure long-term cost savings?" From this opening line, you can assume that Hastie is most likely using a ____ presentation. A. persuasive selling B. logical reasoning C. need-satisfaction D. price/value E. formula Answer: C Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: AnalyticChapter 09 - Carefully Select Which Sales Presentation Method to Use 9-33 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: The need-satisfaction sales presentation method typically begins with questions to the prospect. The opening starts a discussion of the prospect’s needs. 89. What types of sales presentations would you expect Hastie and Ager to use for new customers? A. Need-satisfaction and problem-solution B. Memorized and need-fulfillment C. Need-fulfillment and need-development D. Formula and problem-solution E. Persuasive selling and need-satisfaction Answer: A Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Since the systems that the firm sells are technical and complex in nature, the need-satisfaction and problem-solution sales methods would be best, especially for new customers. The salespeople could use the formula approach for repeat customers. 90. Ager and Hastie are presenting a proposal to a theater group. People in attendance include various accountants, actors, and producers. The sales presentation should include all of the following EXCEPT a(n): A. statement regarding the firm’s guarantees. B. list of theaters the company has equipped. C. history of the company and its mission. D. list of the firm’s safety credentials. E. price list for basic systems. Answer: E Learning Objective: 09-03 Topic: The Group Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Price should not be included in a group proposal because some members of the group may ignore the presentation and focus only on cost. In most cases, some members of the group may not have authority in purchasing decisions.Chapter 09 - Carefully Select Which Sales Presentation Method to Use 9-34 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Essay Questions 91. What are the two assumptions on which a memorized presentation is based? Answer: The memorized presentation is based on either of two assumptions: that a prospect's needs can be stimulated by direct exposure to the product, via the sales presentation, or that these needs have already been stimulated because the prospect has made the effort to seek out the product. Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 92. Comment on the following statement: "No matter what the situation, the need-satisfaction presentation is always the most effective." Answer: This statement is incorrect. The situation determines which sales presentation is the best method to use. The need-satisfaction method is most appropriate when you must gather information from the prospect. Memorized presentation method can be used when time is short and the product is simple. Formula selling is effective in repeat purchases or when you know or have already determined the needs of the prospect. Finally, the problem–solution presentation is excellent for selling high-cost technical products or services, and especially for system selling involving several sales calls and a business proposition. Learning Objective: 09-03 Topic: Sales Presentation Methods—Select One Carefully Blooms: Analyze AACSB: Analytic Level of Difficulty: Hard 93. What should a salesperson do if a prospect decides to not purchase a product or service? Answer: Should the person not buy, do not take it personally. Try to discover why before leaving. This helps you prepare for your return visit. However, chances are the reason for not buying will come out in your presentation. Act as a professional. Leave the door open for a return visit. You might conclude by asking the prospect for permission to come back at a future date before thanking the prospect and leaving. Learning Objective: 09-05 Topic: The Sales Presentation and Techniques Blooms: Analyze AACSB: Analytic Level of Difficulty: HardChapter 09 - Carefully Select Which Sales Presentation Method to Use 9-35 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 94. What are three advantages of using a memorized sales presentation? Answer: The advantages associated with the use of memorized sales presentation are: (1) It ensures that the salesperson gives a well-planned presentation and that all of the company's salespeople discuss the same information. (2) It both aids and lends confidence to the inexperienced salesperson. (3) It is effective when selling time is short, as in door-to-door or telephone selling. (4) It is effective when the product is nontechnical—such as books, cooking utensils, and cosmetics. Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 95. Discuss what a salesperson should review and analyze during the planning phase of negotiation. Answer: Before you make a proposal to a client, search your company’s sales records to find any reports of previous sales to your prospect or similar businesses. If these records documented the successes and failures of negotiating, you will learn from other salespeople’s experience. You should also examine what is valuable to businesses in the prospect’s industry, such as service, price, training, discounts, or implementation. During your preparation, review the various bargaining chips available to you. These might include extra services, price flexibility, negotiable fees, optional equipment, and free training. Some of the questions to answer include these: Learning Objective: 09-04 Topic: Negotiating So Everyone Wins Blooms: Apply AACSB: Analytic Level of Difficulty: Hard 96. What are the three stages of the need-satisfaction sales presentation? Explain each stage. Answer: The need-satisfaction presentation is different from the memorized and the formalized approach; it is designed as a flexible, interactive sales presentation. It is the most challenging and creative form of selling. The three stages involved in this type of sales presentation are: (1) Need-development, (2) Need-awareness, and (3) Need-fulfillment. The first 50 to 60 percent of conversation time (referred to as the need-development phase) is devoted to a discussion of the buyer's needs. Once aware of the prospect's needs (the need-awareness phase), the salesperson begins to take control of the conversation by restating the prospect's needs to clarify the situation. During the last stage of the presentation, the need-fulfillment (or need-satisfaction) phase, the salesperson shows how the product will satisfy mutual needs. Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: UnderstandChapter 09 - Carefully Select Which Sales Presentation Method to Use 9-36 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Medium 97. What are the steps involved in the problem-solution approach to selling? Answer: The six steps in the problem-solution approach are: (1) Convince the prospect to allow the salesperson to conduct the analysis. (2) Make the actual analysis. (3) Agree on the problem and determine the buyer wants to solve it. (4) Prepare the proposal for a solution to the prospect's problem. (5) Prepare the sales presentation. (6) Make the sales presentation. Learning Objective: 09-02 Topic: Sales Presentation Methods—Select One Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 98. Pierre LaSaunt needs to make a proposal to a group of engineers. Why has his sales manager instructed him to omit prices from the proposal document? Answer: Some people will go directly to the prices without reading the proposal. Furthermore, prices tend to prejudice non-decision makers—who should not be concerned with prices. The third reason is politics. Say the engineers have not received a raise lately and they learn the company is going to spend $3 million on this purchase. In this instance, prices could cause animosity. Learning Objective: 09-03 Topic: The Group Presentation Blooms: Analyze AACSB: Analytic Level of Difficulty: Hard 99. Carmen sells women's sportswear. She is experienced in making sales presentations to groups of two to four buyers. Carmen’s sales manager has told her to prepare a presentation for a group of 30 department store buyers. Does Carmen need to make any changes to her typical sales presentation when addressing the larger group? Why or why not? Answer: Yes, she needs to change her presentation. The structure used for the larger group presentation must be much less flexible than the one used for the smaller groups. It would result in chaos if all the participants were allowed to give feedback simultaneously. She needs to plan a question-and-answer period as a part of her presentation. The ideal situation is to talk with most or all of the decision makers involved during the analysis phase. That way, they will have contributed to determining what is needed. The points you discuss will hit on thoughts they have expressed regarding the problems at hand. Learning Objective: 09-03 Topic: The Group Presentation Blooms: Apply AACSB: AnalyticChapter 09 - Carefully Select Which Sales Presentation Method to Use 9-37 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Hard 100. Discuss the various phases of negotiation. Answer: The various phases of negotiation are: (1) Planning: The number one asset of a strong negotiator is preparation. During the planning phase, after completing a competition analysis, you know how your company compares with the competition for price, service, quality, reputation, and so on. (2) Meeting: When you meet a prospect, you start building the relationship by proving you are someone who is credible, trustworthy, and, it is hoped, the type of person your prospect likes to do business with. If you are all these things, you will eliminate tension from the relationship and thereby ease the negotiation process. (3) Studying: During this phase, you must find out what other competitors' products or services your prospect is considering. This gives insight into what they are looking for and willing to pay. (4) Proposing: Proposing is another phase that indirectly affects subsequent negotiations. What you do in the presentation sets the stage for what may come later. During your presentation, tie features and advantages to benefits and emphasize unique benefits. In this way, your product or service and company are positioned above the competition. Learning Objective: 09-04 Topic: Negotiating So Everyone Wins Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 10 - Begin Your Presentation Strategically 10-1 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Chapter 10 Begin Your Presentation Strategically Learning Objectives: 10-01 Explain the importance of using an approach and provide examples of approaches. 10-02 Illustrate why the approach should have a theme that is related to the presentation and the prospect’s important buying motives. What is an example? 10-03 Present four types of questioning techniques for use throughout the presentation, and give an example of each technique. 10-04 Understand the importance of being flexible in your approach. True / False Questions 1. According to the Golden Rule of Selling, salespeople should begin their sales presentation knowing the key customer benefits that will be discussed. Answer: True Learning Objective: 010-01 Topic: The Golden Rule: The Beginning Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: Salespeople should begin their sales presentations knowing the key benefits to be discussed and having a reasonable idea of what to suggest that the prospect or customer buy to solve his or her needs. Salespeople should understand the customer’s needs in order to suggest solutions. 2. The beginning of the sales presentation is called the preapproach. Answer: False Learning Objective: 10-01 Topic: The Golden Rule: The Beginning Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The beginning of the sales presentation is known as the approach rather than the preapproach, which is the planning that occurs prior to the approach. 3. For salespeople, the approach refers to the time when they first see the buyer to when they begin to discuss the product. Answer: True Learning Objective: 10-01 Topic: What Is the Approach? Blooms: Remember AACSB: Analytic Level of Difficulty: EasyChapter 10 - Begin Your Presentation Strategically 10-2 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: For salespeople, the approach refers to the time from when they first see the buyer to when they begin to discuss the product. The approach could last seconds or minutes. 4. One of the ways a salesperson earns the right to the prospect's attention is by exhibiting specific product knowledge. Answer: True Learning Objective: 10-01 Topic: The Right to Approach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A salesperson earns the right to a prospect’s attention by showing product knowledge, being helpful, and expressing a sincere desire to solve a prospect’s problem. 5. Building rapport quickly with new customers is facilitated through the steps of creative imagery. Answer: False Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Successful salespeople use a relaxation and concentration technique called creative imagery that allows them to better cope with stress. The salesperson envisions the worst that can happen. Then preparation is made to react to it and even accept it if need be. 6. A technique called creative imagery allows salespeople to better cope with stress. Answer: True Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Successful salespeople use a relaxation and concentration technique called creative imagery that allows them to better cope with stress. The salesperson envisions the worst that can happen. Then preparation is made to react to it and even accept it if need be. 7. According to research, buyer's reaction to the salesperson in the early minutes of the sales presentation is less important than an effective closing. Answer: False Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 10 - Begin Your Presentation Strategically 10-3 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: A buyer’s reactions to the salesperson in the early minutes of the sales presentation are critical to a successful sale. This short period is so important that it is treated as an individual step in selling, referred to as the approach. Part of any approach is the prospect’s first impression of you. 8. A prospect’s initial impression about a salesperson is primarily based on the salesperson’s appearance and attitude. Answer: True Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The first impression is centered on the image projected by your (1) appearance and (2) attitude. Therefore, salespeople should strive to make favorable first impressions. 9. For making a favorable first impression, the salesperson should apologize for taking the prospect's time. Answer: False Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The author recommends that salespeople avoid apologizing for taking the time of prospects. An apology suggests that the prospect’s time will be wasted, which sets a negative tone. 10. The last part of most sales calls is "small talk" which aids in building rapport between the salesperson and the prospect. Answer: False Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: ―Small talk‖ typically occurs at the beginning of a sales call not the end to build rapport with the prospect.Chapter 10 - Begin Your Presentation Strategically 10-4 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 11. The demonstration approach is appropriate for door-to-door salespeople who use the memorized sales presentation method. Answer: True Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Demonstrations are used with memorized and formula presentation methods. Door-to-door salespeople typically use the memorized method. 12. In general, using statements or demonstrations in the approach is more effective than asking a prospect questions. Answer: False Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Because people buy to fulfill needs or solve problems, the use of questions in your approach is preferable to statements or demonstrations. Questions allow you to uncover needs, whereas statements and demonstrations are appropriate when you assume knowledge of the prospect’s needs. 13. A salesman opens his presentation by saying "Hi, Mr. Johnson. I am Grover Forbes from Pearson Chemicals." The salesman is using the showmanship approach. Answer: False Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The introductory approach is the most common and the least powerful because it does little to capture the prospect’s attention and interest. It opens with the salesperson’s name and business. The showmanship approach involves doing something unusual to catch the prospect’s attention and interest. 14. In the referral approach, a salesperson mentions the name of a mutual acquaintance. Answer: True Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Remember AACSB: Analytic Level of Difficulty: EasyChapter 10 - Begin Your Presentation Strategically 10-5 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: The use of another person’s name, the referral approach, is effective if the prospect respects that person; it is important to remember, however, that the referral approach can have a negative effect if the prospect does not like the person you refer to. 15. The complimentary approach is the most common and the least powerful because it does little to capture the prospect's attention and interest. Answer: False Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The introductory approach is the most common and the least powerful because it does little to capture the prospect’s attention and interest. If the complimentary approach is sincere, it is an effective beginning to a sales interview because everyone appreciates a compliment. 16. The introductory approach involves distributing free samples and novelty items. Answer: False Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A premium approach often involves distributing free samples and novelty items. With the introductory approach, a salesperson provides his or her name and company. 17. A salesperson using the product approach would hand his/her product to the prospect and ask, "What do you think of that?" Answer: False Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: In the product approach, the salesperson places the product on the counter or hands it to the customer, saying nothing. The salesperson waits for the prospect to begin the conversation. 18. Demonstration openings are effective because the prospect is encouraged to participate in the discussion with the salesperson. Answer: True Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: UnderstandChapter 10 - Begin Your Presentation Strategically 10-6 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Medium Explanation: Openings that use demonstrations and drama are especially effective because of their ability to force the prospect into participating in the interview. 19. The showmanship approach involves doing something unusual to catch the prospect's attention and interest. Answer: True Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The showmanship approach involves doing something unusual to catch the prospect’s attention and interest. The method involves the use of a demonstration. 20. The customer benefit approach begins with a question that implies the product will help the prospect. Answer: True Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Using the customer benefit approach, the salesperson asks a question that implies the product will benefit the prospect; A customer benefit approach can also be implemented through the use of a direct statement of product benefits. 21. Benefit statements are useful in situations where you do not know the prospect's critical needs and when you have sufficient time to make a presentation. Answer: False Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Benefit statements are useful in situations in which you know the prospect’s critical needs and have a short time to make your presentation. 22. The opinion approach is recommended for new salespeople. Answer: True Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Remember AACSB: AnalyticChapter 10 - Begin Your Presentation Strategically 10-7 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: The opinion approach is especially good for the new salesperson because it shows that you value the buyer’s opinion. Opinion questioning also shows that you will not challenge a potential buyer’s expertise by spouting a memorized pitch. 23. The opinion approach challenges a potential buyer's expertise by spouting a memorized pitch. Answer: False Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The opinion approach implies that you value the buyer’s opinion. Opinion questioning also shows that you will not challenge a potential buyer’s expertise by spouting a memorized pitch. 24. The shock approach uses a surprising demonstration. Answer: False Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The shock approach uses a question designed to make the prospect think seriously about a subject related to the salesperson’s product. 25. By using the SPIN approach, salespeople hope to gain a prospect’s permission to analyze a problem. Answer: False Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The multiple questions in the SPIN approach force the prospect to immediately participate in the sales interview and quickly develop two-way communication. Carefully listening to the prospect’s needs helps the salesperson to determine what features, advantages, and benefits to use in the sales presentation. The method is not used to gain permission to conduct an analysis.Chapter 10 - Begin Your Presentation Strategically 10-8 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 26. A salesperson is using the SPIN approach. The prospect states a specific need after the salesperson asks the problem question. The salesperson should move directly into the presentation. Answer: False Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: If the prospect should state a specific need after your situation or problem questions, do not move directly into your sales presentation. Continue with the next two steps to increase your chances of making the sale. A prospect may sometimes not appreciate all the ramifications of a problem. 27. The situation question used in the SPIN approach must always be asked last. Answer: False Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: S-P-I questions do not have to be asked in order, and you can ask more than one of each type. The need-payoff question, however, is always last. 28. A salesperson using the SPIN approach should regularly mention the product during the discussion. Answer: False Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The product is not mentioned in the SPIN approach. This allows you to develop the prospect’s need without revealing exactly what you are selling. 29. When asking a question, the salesperson should know or anticipate the answer for the question. Answer: True Learning Objective: 10-03 Topic: Using Questions Results in Sales Success Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 10 - Begin Your Presentation Strategically 10-9 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: When using questions in selling, you need to know or anticipate the answer you want for a question. Once you know the desired answer, you can develop the question. This procedure can be used to request information you do not have and to confirm information you already know. 30. While using a nondirective question as an approach method, the salesperson should begin the discussion with an open-ended question. Answer: True Learning Objective: 10-03 Topic: Using Questions Results in Sales Success Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: To open up two-way communication, the salesperson can use an open-ended or nondirective question by beginning the question with one of six words: who, what, where, when, how, or why. 31. A salesperson asks a prospect, "Who will be the primary user for the camera?" The salesperson is using a direct question. Answer: False Learning Objective: 10-03 Topic: Using Questions Results in Sales Success Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: An open-ended or nondirective question begins a question with one of six words: who, what, where, when, how, or why. Direct questions may begin with words such as do or are, which generate yes or no responses. 32. A salesperson who overcomes a prospect’s indifference early in a sales call has a greater chance of making a sale. Answer: True Learning Objective: 10-04 Topic: Is the Prospect Still Not Listening? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: If you can overcome preoccupation or indifference in the early minutes of your interview by quickly capturing the prospect’s attention and interest, the probability of your making a sale will greatly improve. This is why the approach is so important to the success of a sales call.Chapter 10 - Begin Your Presentation Strategically 10-10 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 33. Probes help salespeople develop two-way communication with prospects. Answer: True Learning Objective: 10-03 Topic: Using Questions Results in Sales Success Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Asking questions, sometimes called probes, is an excellent technique for obtaining information from the prospect, developing two-way communication, and increasing prospect participation. 34. After asking a prospect a question, a salesperson should remain silent and wait for an answer. Answer: True Learning Objective: 10-03 Topic: Using Questions Results in Sales Success Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: When asking questions, a salesperson should pause or wait to allow the prospect time to respond. A salesperson must allow the prospect time to consider the question, and hope for a response. 35. A direct negative-no question is highly effective for creating interest with prospects. Answer: False Learning Objective: 10-03 Topic: Using Questions Results in Sales Success Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Never phrase the direct question as a direct negative–no question. A direct negative–no question is any question that can be answered in a manner that cuts you off completely.Chapter 10 - Begin Your Presentation Strategically 10-11 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Multiple Choice Questions 36. Which of the following is a stage in the selling process during which a salesperson meets, greets, and establishes rapport with the prospect? A. Qualifying B. Data mining C. Preapproach D. Leading E. Approach Answer: E Learning Objective: 10-01 Topic: What Is the Approach? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: For salespeople, the approach refers to the time from when they first see the buyer to when they begin to discuss the product. The approach could last seconds or minutes depending upon the time it takes to meet, greet, and build rapport. 37. According to the text, as a salesperson, you will most likely earn the right to a prospect's time and serious attention by: A. working for a large, reputable organization. B. exhibiting specific product knowledge. C. ignoring sales presentation interruptions. D. being on time for all appointments. E. using creative imagery. Answer: B Learning Objective: 10-01 Topic: The Right to Approach Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Showing product or service knowledge is likely to gain the attention of a prospect. Although working for a reputable firm and being prompt are important, knowledge helps a salesperson gain the attention of a customer. 38. Creative imagery is a: A. presentation method that replaces a demonstration when selling over the telephone. B. presentation technique that replaces a demonstration when selling a service. C. technique used by salespeople that allows them to better cope with stress. D. manner of selecting clothing that ensures a good first impression. E. presentation technique that employs the use of technology. Answer: C Learning Objective: 10-01 Topic: The Approach—Opening the Sales PresentationChapter 10 - Begin Your Presentation Strategically 10-12 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Successful salespeople have learned a relaxation and concentration technique called creative imagery that allows them to better cope with stress. The salesperson envisions the worst that can happen. Then preparation is made to react to it and even accept it if need be. 39. During the approach, a Golden Rule salesperson should: A. implement creative imagery. B. use the showmanship approach. C. eliminate distractions for the prospect. D. focus on the needs of the prospect. E. ask the prospect direct questions. Answer: D Learning Objective: 10-01 Topic: The Golden Rule: The Beginning Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: A Golden Rule salesperson should help the customer even if that means no sale occurs. In order to help, the salesperson must understand the prospect’s needs to suggest solutions. 40. The three categories into which approach techniques can be grouped are: A. participative, standard, and benefit. B. compliment, referral, and participative. C. question, participative, and controlled. D. statement, demonstration, and question. E. question, compliment, and benefit. Answer: D Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Approach techniques are grouped into three general categories: (1) opening with a statement; (2) opening with a demonstration; and (3) opening with one or more questions.Chapter 10 - Begin Your Presentation Strategically 10-13 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 41. What is an objective of both the statement and demonstration approach? A. Capture the prospect's attention B. Remind the prospect of product features C. Determine the prospect's personality type D. Close the sale quickly E. Make a favorable first impression Answer: A Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Both the statement and demonstration approach techniques have three basic objectives: to capture the prospect’s attention; to stimulate the prospect’s interest; and to provide a transition into the sales presentation. 42. Which of the following statements about approach techniques and presentation methods is most likely true? A. The benefit technique is used only with the formula sales method. B. The showmanship technique does not always include a demonstration. C. The approach technique should be chosen before the sales presentation method. D. The statement approach technique is effective with any sales presentation method. E. The need-satisfaction sales presentation method should always use the questions approach technique. Answer: E Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Using questions in a sales approach is feasible with any of the four presentation methods, whereas statements and demonstrations typically are reserved for either the memorized or formula sales presentation methods. Because of their customer-oriented nature, the need-satisfaction and problem–solution sales presentation methods always employ questions at the outset. 43. The _____ approach is considered weak because it fails to capture the prospect's attention and interest. A. referral B. introductory C. premium D. complimentary E. product Answer: B Learning Objective: 10-01Chapter 10 - Begin Your Presentation Strategically 10-14 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Topic: The Approach—Opening the Sales Presentation Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The introductory approach is the most common and the least powerful because it does little to capture the prospect’s attention and interest. It opens with the salesperson’s name and business. 44. Which of the following is an example of the introductory approach? A. "Mr. Lawrence, you certainly sell a lot of perennials to landscaping companies." B. "Good afternoon. Does your company need a secure local area network?" C. "Hello, Mr. Ariana at Country Stay Inn told me you might be interested in my company's new line of mildew-proof shower curtains." D. "Here, Ms. Li, try one of my company's throat lozenges." E. "Hello, Ms. Rosenberg, my name is Sashmi Patel, representing the Pearce Chemical Company." Answer: E Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: The introductory approach opens with the salesperson’s name and business. The other approaches mention the prospect’s business, the salesperson’s product, or a potential need, so they are not introductory approaches. 45. A salesperson walked into the wholesale floral center and said, "Ms. Ruiz, in my job I visit a lot of nurseries, and I believe you grow the most beautiful flowers I have ever seen." This is an example of the _____ approach. A. introductory B. complimentary C. referral D. demonstration E. product Answer: B Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Communication Level of Difficulty: MediumChapter 10 - Begin Your Presentation Strategically 10-15 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: The salesperson is complimenting Ms. Ruiz’s nursery and using the complimentary approach. If the complimentary approach is sincere, it is an effective beginning to a sales interview 46. The _____ approach involves mentioning the name of a person known to both the buyer and seller. A. curiosity B. question C. referral D. demonstration E. introductory Answer: C Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The use of another person’s name, the referral approach, is effective if the prospect respects that person; it is important to remember, however, that the referral approach can have a negative effect if the prospect does not like the person you refer to. 47. Petra Lamar approached her prospect with the following words, "Hello, Dr. Keeler, Willa Fox with the County General Hospital suggested that I contact you concerning our new MRI scanner." What type of approach statement was Petra Lamar using? A. Introductory B. Referral C. Premium D. Complimentary E. Product Answer: B Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Petra is mentioning a mutual acquaintance in hopes of engaging the prospect in a conversation. This method is known as the referral approach.Chapter 10 - Begin Your Presentation Strategically 10-16 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 48. Becca likes to introduce the 100 percent organic fruit juice her company has just begun to manufacture by giving retail store managers a small sample bottle to take home and try. Becca is using the _____ approach. A. sales promotion B. product C. showmanship D. customer benefit E. premium Answer: E Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Becca is giving away free samples, so she is using the premium approach. A premium approach is effective because everyone likes to receive something free. 49. When the salesperson for Thymes Unlimited walked into the office of the department store buyer, she laid a sample of the company's newest line of hand-blown glass candleholders in front of the buyer and said nothing as she waited for the buyer to comment on the candleholder. This salesperson used the _____ approach. A. showmanship B. silent benefit C. shock D. product E. curiosity Answer: D Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: In the product approach, the salesperson places the product on the counter or hands it to the customer, saying nothing. The salesperson waits for the prospect to begin the conversation. The premium approach involves giving away free samples or gifts. 50. The product approach works best with: A. brand name items. B. generic products. C. straight rebuy situations. D. high-tech business products. E. new and unique products. Answer: E Learning Objective: 10-01 Topic: The Approach—Opening the Sales PresentationChapter 10 - Begin Your Presentation Strategically 10-17 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The product approach is useful if the product is new, unique, or colorful, or if it is an existing product that has changed noticeably. 51. Which of the following would most likely benefit a salesperson? A. Empathize with the prospect and ask personal questions. B. Use only questions for which you can anticipate the answer. C. Use more open ended questions and less close ended questions. D. Ask a redirecting question when your prospect waits to respond. E. Do not repeat or summarize what the prospect has just said. Answer: B Learning Objective: 10-03 Topic: Using Questions Results in Sales Success Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Salespeople should use only questions that they can anticipate the answer to otherwise the salesperson may end up in an awkward position. Asking personal questions is unprofessional, and the number of open and closed questions depends on the situation. 52. To illustrate the benefits of the Dixie Chopper brand lawn mowers to professional landscapers, the salesperson asks prospects to participate in a mowing race. Even if the competing mower has a wider cutting area, the Dixie Chopper always wins because it is the only lawn mower that can travel fifteen miles per hour. What approach does the Dixie Chopper salesperson use? A. Referral B. Premium C. Complimentary D. Showmanship E. Product Answer: D Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The showmanship approach involves doing something unusual to catch the prospect’s attention and interest; this should be done carefully so that the approach does not backfire, which can happen if the demonstration does not work or is so flamboyant that it is inappropriate for the situation.Chapter 10 - Begin Your Presentation Strategically 10-18 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 53. To illustrate how fire-retardant his company's children clothing was, the salesperson took a pair of toddler-sized pajamas, placed them in the department store buyer's trashcan and set them on fire. Unfortunately, the buyer's plastic trashcan was not fire-resistant. The resulting fire damaged the buyer's carpeting and desk. This explains: A. why the curiosity approach should not be used except on rare occasions. B. how the showmanship approach can be inappropriate or fail. C. why question approaches are used with such frequency. D. why pre-approaches are important to sales success. E. why customer benefit approaches are complex. Answer: B Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Analyze AACSB: Analytic Level of Difficulty: Hard Explanation: The showmanship approach involves doing something unusual to catch the prospect’s attention and interest; this should be done carefully so that the approach does not backfire, which can happen if the demonstration does not work or causes damage. 54. "Do you know that you could save almost $100 if you purchase your airplane tickets through Global Vision Travel Agency?" asked the travel agent to the young couple planning their honeymoon trip to Europe. What kind of an approach was the travel agent using? A. Product B. Customer benefit C. Premium D. Demonstration E. Complimentary Answer: B Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A customer benefit approach statement is constructed to anticipate the buyer’s response. Using this approach, the salesperson asks a question that implies the product will benefit the prospect.Chapter 10 - Begin Your Presentation Strategically 10-19 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 55. The equipment salesperson asked the professional landscaper, "Did you know the Red Max brand backpack blower can save you time and money because it is the most powerful blower on the market and because it features an extra-large fuel tank?" What kind of an approach was the salesperson using? A. Product B. Customer benefit C. Premium D. Demonstration E. Complimentary Answer: B Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A customer benefit approach statement is constructed to anticipate the buyer’s response. Using this approach, the salesperson asks a question that implies the product will benefit the prospect. 56. The customer benefit approach is most useful when the salesperson: A. knows the prospect's critical needs. B. calls on a new, unfamiliar prospect. C. develops a lengthy sales presentation. D. sells a complex, technical product. E. sells newly redesigned products. Answer: A Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Benefit statements are useful in situations in which you know the prospect’s or customer’s critical needs and have a short time to make your presentation. 57. "Do you know why you should be using synthetic motor oil in your new Lexus?" the service manager asked Henri Wilton when he brought his new car to the Lexus dealership for a routine servicing. What type of approach is the service manager using? A. Product B. Opinion C. Curiosity D. SPIN E. Customer benefit Answer: C Learning Objective: 10-01Chapter 10 - Begin Your Presentation Strategically 10-20 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The curiosity approach involves the salesperson asking a question or doing something to make the prospect curious about a product or service. 58. Rubin is making a sales call on McHenry Heating and Air Conditioning tomorrow. This afternoon, he sent a bunch of balloons and a note to the firm's buyer that said, "Did you know tomorrow is your lucky day?" What type of approach is used by Rubin? A. Curiosity B. Product C. Opinion D. SPIN E. Customer benefit Answer: A Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The curiosity approach involves the salesperson asking a question or doing something to make the prospect curious about a product or service. The salesperson hopes to increase the interest of the prospect and make a sale. 59. Arvin Hampton begins his approach by saying, "I'm new at selling home safety equipment, so I was wondering if you could tell me the most commonly purchased items?" Hampton is using the _____ approach. A. curiosity B. product C. showmanship D. premium E. opinion Answer: E Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 10 - Begin Your Presentation Strategically 10-21 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: The opinion approach is especially good for the new salesperson like Mariah because it shows that you value the buyer’s opinion. Opinion questions may reveal previously unexplored opportunities for a product to meet even more of the prospect’s needs. 60. A salesperson asks the prospect," What do you think about our new line of products?" Which approach is being used? A. Product B. Opinion C. Curiosity D. SPIN E. Customer benefit Answer: B Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The opinion approach involves asking for the thoughts of the prospect. Opinion questions may reveal previously unexplored opportunities for a product to meet even more of the prospect’s needs. 61. Which of the following types of approaches is especially good for a new salesperson? A. Product B. Showmanship C. Complementary D. SPIN E. Opinion Answer: E Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The opinion approach is especially good for the new salesperson because it shows that you value the buyer’s opinion. Opinion questioning also shows that you will not challenge a potential buyer’s expertise by spouting a memorized pitch.Chapter 10 - Begin Your Presentation Strategically 10-22 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 62. If a salesperson for a security company were to walk into a prospect's office and say, "According to a recent FBI study, 10 percent of your employees have stolen something tangible from your company," she would be using the _____ approach. A. curiosity B. testimonial C. shock D. proof statement E. scare-tactic Answer: C Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The shock approach uses a question designed to make the prospect think seriously about a subject related to the salesperson’s product. 63. Which of the following types of approaches is most likely to be misinterpreted as highpressure selling? A. Opinion B. Referral C. Introductory D. Complimentary E. Shock Answer: E Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The shock approach must be used carefully because some prospects may feel you are merely trying to pressure them into a purchase by making alarming remarks. 64. All of the following are benefits of the opinion approach EXCEPT: A. revealing unexplored product opportunities. B. helping new salespeople to engage prospects. C. using technology to show product applications. D. encouraging prospects to discuss their needs. E. showing appreciation for a prospect’s expertise. Answer: C Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: AnalyticChapter 10 - Begin Your Presentation Strategically 10-23 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: The opinion approach is especially good for the new salesperson because it shows that you value the buyer’s opinion. Opinion questioning also shows that you will not challenge a potential buyer’s expertise by spouting a memorized pitch. Additionally, opinion questions may reveal previously unexplored opportunities for your product to meet even more of the prospect’s needs, but technology is not necessarily involved. 65. Which of the following is an example of a situation question that might be used in the SPIN approach? A. "Does your computer seem really slow when compared to the one your neighbor owns?" B. "Are you happy with how your present oven prepares your food?" C. "How many children under the age of 10 live in your apartment building?" D. "Have your secretaries ever complained about the speed of your copier machine?" E. "What was your first reaction when your son was diagnosed with asthma?" Answer: C Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: Situation questions ask about the prospect’s general situation as it relates to your product. The salesperson first asks a situation question that helps provide a general understanding of the buyer’s needs, such as the number of children in an apartment building. 66. Which of the following is an example of a problem question that might be used in the SPIN approach? A. "How many brands of cereal does your convenience store sell?" B. "Has your business outgrown your current facility?‖ C. "Do you eat out with your family very often?" D. "Do you like to go to NASCAR races?" E. "How many accountants do you employ?" Answer: B Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: Problem questions ask about specific problems, dissatisfactions, or difficulties the prospect perceives relative to your situation question. Problem questions are asked early in the presentation to bring out the needs or problems of the prospect. Your goal is to have the prospect admit, ―Yes, I do have a problem.‖Chapter 10 - Begin Your Presentation Strategically 10-24 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 67. Which of the following statements about problem questions in the multiple-question approach is true? A. The questions seek to identify general problems. B. The goal is for the prospect to admit having a problem. C. The problem questions are asked first in the sequence. D. It is unnecessary to separate unimportant problems from important problems. E. The salesperson moves directly to the presentation after identifying a specific problem. Answer: E Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Problem questions are asked early in the presentation to bring out the needs or problems of the prospect. The goal is to have the prospect admit having a problem. However, once the salesperson identifies the problem, it is better to continue with the next two steps to rather than move into the presentation. 68. An automobile dealer asks a couple visiting the car lot, "Since the birth of the triplets, don't you find it difficult to wedge three car seats and all the baby paraphernalia into your old Toyota?" What type of question is he using? A. Beneficial B. Implication C. Need D. Strategic E. Product Answer: B Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Implication questions ask about the implications of the prospect’s problems or how a problem affects various related operational aspects of a home, life, or business. 69. The way a salesperson phrases the need-payoff question when using the SPIN approach is similar to phrasing in the _____ approach. A. customer benefit B. opinion C. referral D. curiosity E. product Answer: A Learning Objective: 10-01 Topic: The Approach—Opening the Sales PresentationChapter 10 - Begin Your Presentation Strategically 10-25 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Phrasing the need-payoff question is the same as opening with a benefit statement. However, in using the SPIN approach, the prospect defines the need. If the prospect responds positively to the need-payoff questions, you know this is an important need. 70. A prospect responds positively to the need-payoff question in the SPIN approach. What should the salesperson do next? A. Request a purchase B. Ask direct questions C. Provide statistical data D. Move into a sales presentation E. Ask additional ―problem‖ questions Answer: D Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: Once the prospect responds positively to a need-payoff question, the salesperson has identified an explicit and important need. The salesperson is then ready to move into a brief sales presentation. 71. If a prospect responds negatively to a need-payoff question in the SPIN approach, the salesperson should: A. ask direct questions. B. go directly into the presentation. C. use a trial close to gather feedback. D. begin demonstration of the product. E. start over with problem, implication, and need-payoff questions. Answer: E Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: If the prospect responds positively to the need-payoff questions, the salesperson knows this is an important (explicit) need. However, a negative response may require the salesperson to repeat the P-I-N questions to fully develop all of the prospect’s important needs.Chapter 10 - Begin Your Presentation Strategically 10-26 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 72. A salesperson should use probes to: A. obtain information from the prospect. B. control the motivation of the prospect. C. maintain one-way communication. D. limit prospect participation. E. create a buyer-seller chain of command. Answer: A Learning Objective: 10-03 Topic: Using Questions Results in Sales Success Blooms: Remember AACSB: Communication Level of Difficulty: Easy Explanation: Asking questions, sometimes called probes, is an excellent technique for (1) obtaining information from the prospect, (2) developing two-way communication, and (3) increasing prospect participation. 73. When using questions in the selling process, a salesperson should most likely: A. use primarily direct questions. B. be assertive, forceful, and positive. C. be able to anticipate the answers. D. concentrate on a product's advantages. E. accept that most prospects expect discounts. Answer: C Learning Objective: 10-03 Topic: Using Questions Results in Sales Success Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: When using questions in selling, you need to know or anticipate the answer you want for a question. Once you know the desired answer, you can develop the question. This procedure can be used to request information you do not have and to confirm information you already know.Chapter 10 - Begin Your Presentation Strategically 10-27 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 74. The implication and need-payoff questions used in SPIN are examples of ____ questions. A. redirect B. participative C. rephrasing D. stimulus-response E. direct Answer: E Learning Objective: 10-03 Topic: Using Questions Results in Sales Success Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The implication and need-payoff questions used in SPIN are examples of direct questions used for the approach. The direct question, or closed-ended question, can be answered with very few words. 75. Meaghan asked the florist, "Are the refrigeration costs for your fresh-cut flowers too high?" This is an example of a _____ question. A. redirect B. direct C. nondirective D. rephrasing E. participative Answer: B Learning Objective: 10-03 Topic: Using Questions Results in Sales Success Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The direct question, or closed-ended question, can be answered with very few words. A simple yes or no answers most direct questions, such as this one. 76. Gina asked the customer, "Do you need a purse to go with these new shoes you just bought?" This is an example of a _____ question. A. nondirective B. redirect C. participative D. direct E. rephrasing Answer: D Learning Objective: 10-03 Topic: Using Questions Results in Sales Success Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 10 - Begin Your Presentation Strategically 10-28 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: The direct question, or closed-ended question, can be answered with very few words. A simple yes or no answers most direct questions, such as this one. 77. Which of the following questions is an example of a direct question? A. "Would you like to try a free sample today?‖ B. "How will you use this forged steel trowel?" C. "Why do you need an additional monitor?‖ D. "What features do you need in a phone?" E. "Where will you use this security light?" Answer: A Learning Objective: 10-03 Topic: Using Questions Results in Sales Success Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The direct question, or closed-ended question, can be answered with very few words. A simple yes or no answers most direct questions. 78. "How often would you use a garage door opener?" is an example of a _____ question. A. direct B. redirect C. rephrasing D. participative E. nondirective Answer: E Learning Objective: 10-03 Topic: Using Questions Results in Sales Success Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: To open up two-way communication, the salesperson can use an open-ended or nondirective question by beginning the question with one of six words: who, what, where, when, how, or why. 79. Another name for a nondirective question is a(n) _____ question. A. participative B. open-ended C. reciprocal D. stimulus-response E. problem-solution Answer: B Learning Objective: 10-03 Topic: Using Questions Results in Sales Success Blooms: Remember AACSB: AnalyticChapter 10 - Begin Your Presentation Strategically 10-29 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: Nondirective and open-ended question are the same. Such questions open up two-way communication between buyer and seller. 80. Which of the following statements is true about a nondirective question? A. Most nondirective questions are closed ended. B. A nondirective question usually begins with do or are. C. Nondirective questions are used to find points of agreement D. A nondirective question clarifies a prospect’s previous statement. E. One word questions can sometimes be used as nondirective questions. Answer: E Learning Objective: 10-03 Topic: Using Questions Results in Sales Success Blooms: Understand AACSB: Level of Difficulty: Medium Explanation: One-word questions such as Oh? or Really? can be useful in some situations and may prompt the customer to continue talking. Nondirective questions are open-ended and usually include who, what, where, when, how, or why. 81. Which of the following is the best example of a nondirective question? A. "Do you prefer the napkins to be 100 percent cotton or a cotton-polyester blend?" B. "Did I understand you to say that your family has never taken a vacation?" C. "Would you agree that the Lexus is one of the best cars on the road today?" D. "What features are you interested in adding to your swimming pool?" E. "Will you want your new refrigerator delivered Monday or Tuesday?" Answer: D Learning Objective: 10-03 Topic: Using Questions Results in Sales Success Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: To open up two-way communication, the salesperson can use an open-ended or nondirective question by beginning the question with one of six words: who, what, where, when, how, or why.Chapter 10 - Begin Your Presentation Strategically 10-30 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 82. "You're saying that automobile quality and service are less important to you than price?" is an example a _____ question. A. direct B. rephrasing C. redirect D. nondirective E. product-specific Answer: B Learning Objective: 10-03 Topic: Using Questions Results in Sales Success Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Rephrasing questions are asked when the prospect makes an unclear comment or statement. This form of restatement allows you to clarify meaning and determine the prospect’s needs. 83. The primary purpose of asking a rephrasing question is to: A. probe for the prospect’s objections. B. identify the prospect’s concern. C. encourage free discussion. D. clarify the prospect’s meaning. E. emphasize an area of agreement. Answer: D Learning Objective: 10-03 Topic: Using Questions Results in Sales Success Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Rephrasing questions are primarily asked when the salesperson does not understand a prospect’s comment or statement. Such questions enable the seller to clarify the buyer’s needs and concerns. 84. If you walk into your prospect's office and she says "I'm sorry, but there's no use in our talking. I'm satisfied with my current suppliers. Thanks for coming by." You should use a _____ question to move the conversation from the negative ground to a more positive condition. A. direct B. nondirective C. rephrasing D. directional E. redirect Answer: E Learning Objective: 10-03 Topic: Using Questions Results in Sales SuccessChapter 10 - Begin Your Presentation Strategically 10-31 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: When a salesperson is immediately given a negative response from a buyer, the salesperson should redirect the conversation to selling points that both buyer and seller agree with. Using a redirect question moves the conversation from a negative position to a positive or neutral one while reestablishing communication between two people. 85. When Monty asked the prospect for her order, she responded, "I've listened to your presentation, and I'm still not convinced your brand of paint is superior to the one we currently use. Thanks but no thanks." Monty should use a _____ question to point the prospect back to the areas of the sales presentation when the prospect agreed with his statements. A. direct B. nondirective C. redirect D. directional E. rephrasing Answer: C Learning Objective: 10-03 Topic: Using Questions Results in Sales Success Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Using a redirect question moves the conversation from a negative position to a positive or neutral one while reestablishing communication between two people. The ability to redirect a seemingly terminated conversation through a well-placed question may impress the prospect simply by showing that you are not a run-of-the-mill order-taker, but a professional salesperson who sincerely believes in the beneficial qualities of your product. Clearwater Hampers Clearwater Hampers is a small British company that sells luxury food and drink in various combinations in picnic hampers. Food and wine are seen as classic, fail-safe gifts in a market where present-buying is increasingly tricky. Corporate customers, both in the United Kingdom and abroad, are important to the business. Clearwater has had several orders for more than a quarter of a million dollars. The company's leading salesperson, Peter Austin, is preparing the approach he will use during his first sales call on the CEO of Diamonite, a company that specializes in designing, manufacturing, and installing aircraft interiors for executives and heads of state.Chapter 10 - Begin Your Presentation Strategically 10-32 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 86. "Hi, I'm Peter Austin from Clearwater Hampers. How would you like to give your clients a unique gift that will clearly demonstrate your gratitude for their business?" Austin’s question suggests that he is using the _____ approach. A. interrogatory B. showmanship C. premium D. customer benefit E. FAB Answer: D Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Using this approach, the salesperson asks a question that implies the product will benefit the prospect. This approach requires anticipating the buyer’s response. 87. Austin would most likely use creative imagery to: A. establish seller empathy. B. cope with pre-call stress. C. incorporate dramatic visual aids. D. facilitate two-way communication. E. develop synergy with the prospect. Answer: B Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Successful salespeople have learned a relaxation and concentration technique called creative imagery that allows them to better cope with stress. The salesperson envisions the worst that can happen and prepares an appropriate reaction. 88. What type of approach will Austin be using if he enters the CEO's office and says, "Good morning. I'm Peter Austin from Clearwater Hampers." A. Situational B. Introductory C. Self-effacing D. Neutral E. Curiosity Answer: B Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Remember AACSB: AnalyticChapter 10 - Begin Your Presentation Strategically 10-33 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: The introductory approach involves salespeople stating their name and firm. It is the least effective type of approach because it fails to generate interest from the buyer. 89. Austin enters the CEO's office with a small basket of cheese, wine caviar, and other luxury food items for the CEO to enjoy later. What type of an approach is Austin using? A. Premium B. Curiosity C. Complementary D. Action E. SPIN Answer: A Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A premium approach is being used by Austin because he is giving the CEO a small gift. The approach is effective because everyone likes to receive something free. 90. To use questions effectively in his approach, Austin most likely needs to: A. create reciprocity. B. steer clear of any preconceived answers. C. anticipate the answers of the questions. D. remove all distractions from the immediate environment. E. agree to everything the prospect says. Answer: C Learning Objective: 10-03 Topic: Using Questions Results in Sales Success Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: When using questions in selling, you need to know or anticipate the answer you want for a question. Once you know the desired answer, you can develop the question.Chapter 10 - Begin Your Presentation Strategically 10-34 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Essay Questions 91. In the sales process, what is the approach? What occurs during the approach? What is the significance of this step in the sales process? Answer: The approach is the third stage of the selling process. Approach refers to the time from when the salesperson first sees the buyer to when they begin to discuss the product. The approach could last seconds or minutes depending upon the time needed to meet, greet, build rapport and implement one of the approach techniques. Many sales trainers feel that it can be the most important step toward helping customers solve their needs through buying your products. If the approach is unsuccessful, you may never get the opportunity to give your product presentation. Learning Objective: 10-01 Topic: What Is the Approach? Blooms: Analyze AACSB: Analytic Level of Difficulty: Hard 92. Give as many suggestions as you can for making a good first impression. Answer: Wear suitable and conservative business clothes. Be neat in dress and grooming. Refrain from smoking, chewing gum, or drinking in the prospect's office. Keep an erect posture to project confidence. Leave all unnecessary materials outside the office. If possible, sit down—even asking to if not offered. Be enthusiastic and positive. Smile and do not apologize for taking the prospect's time. Do not imply that you were just passing by or that the call was not planned. Maintain eye contact. Give a firm handshake. Make sure you can pronounce your prospect's name, and any other names of people you are introduced to—use their names in the conversation. Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Communication Level of Difficulty: Medium 93. What are the three general categories of approach techniques? What is the relationship between the approach technique and the sales presentation method? Answer: The three general categories are (1) opening with a statement, (2) opening with a demonstration and (3) opening with a question. Your choice of approach technique depends on which of the four sales presentation methods you have selected based on your situation and sales presentation plan. Learning Objective: 10-02 Topic: The Approach—Opening the Sales Presentation Blooms: Analyze AACSB: Analytic Level of Difficulty: HardChapter 10 - Begin Your Presentation Strategically 10-35 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 94. You have decided to open your sales presentation with either a demonstration or a statement. List what three basic objectives you should hope to accomplish with the technique you choose. Answer: Both the statement and demonstration approach techniques have three basic objectives: (1) To capture the attention of the prospect, (2) to stimulate the prospect's interest, and (3) to provide a transition into the sales presentation. Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 95. Describe the four statement approaches frequently used by salespeople. Answer: Four statement approaches frequently used are (1) the introductory approach, (2) the complimentary approach, (3) the referral approach, and (4) the premium approach. The introductory approach is the most common and the least powerful because it does little to capture the prospect's attention and interest. Everyone likes a compliment. If the complimentary approach is sincere, it is an effective beginning to a sales interview. The use of another person's name, the referral approach, is effective if the prospect respects that person; it is important to remember, however, that the referral approach can have a negative effect if the prospect does not like the person you referred. A premium approach is effective because everyone likes to receive something free. When appropriate, use free samples and novelty items in a premium approach. Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 96. Why is it effective to open a presentation with a demonstration? Describe two demonstration methods used by salespeople. Answer: Openings that use demonstrations and drama are especially effective because of their ability to force the prospect into participating in the interview. In the product approach, the salesperson places the product on the counter or hands it to the customer, saying nothing. The salesperson waits for the prospect to begin the conversation. The product approach is useful if the product is new, unique, or colorful, or if it is an existing product that has changed noticeably. The showmanship approach involves doing something unusual to catch the prospect's attention and interest; this should be done carefully so that the approach does not backfire, which can happen if the demonstration does not work or is so flamboyant that it is inappropriate for the situation. Learning Objective: 10-01 Topic: The Approach—Opening the Sales PresentationChapter 10 - Begin Your Presentation Strategically 10-36 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Blooms: Analyze AACSB: Communication Level of Difficulty: Hard 97. Opening a presentation with questions is common among salespeople. Briefly describe three questioning approaches. Answer: (1) Customer Benefit Approach: Using this approach, the salesperson asks a question that implies the product will benefit the prospect; if it is their initial meeting, the salesperson can include both his (her) and the company's name. (2) Curiosity Approach: The salesperson asks a question or does something to make the prospect curious about the product or service. (3) Opinion Approach: People are usually flattered when asked their opinion on a subject. Most prospects are happy to discuss their needs if asked correctly. The opinion approach is especially good for the new salesperson because it shows that you value the buyer's opinion. Opinion questioning also shows that you will not challenge a potential buyer's expertise by spouting a memorized pitch. Additionally, opinion questions may reveal previously unexplored opportunities for your product to meet even more of the prospect's needs. (4) Shock Approach: As its title implies, the shock approach uses a question designed to make the prospect think seriously about a subject related to the salesperson's product. (5) Multiple-Question Approach (SPIN): A relatively new method of using multiple questions is the multiple-question approach (SPIN), which involves using a series of four types of questions in a specific sequence. SPIN stands for Situation, Problem, Implication, and Needpayoff questions. Learning Objective: 10-03 Topic: Using Questions Results in Sales Success Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 98. Why is the product not mentioned in the SPIN approach? Answer: In the SPIN approach, the product is not mentioned, as it allows you to develop the prospect's needs before disclosing what you are selling. When a salesperson first walks into the buyer's office and says, "I want to talk about Product X," the chances of a negative response greatly increase because the buyer does not perceive a need for the product. SPIN questions allow you to better determine the buyer's needs before starting the presentation. Learning Objective: 10-03 Topic: Using Questions Results in Sales Success Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 10 - Begin Your Presentation Strategically 10-37 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 99. Why would a salesperson use probes in an approach? Answer: Probes, sometimes called questions, are an excellent technique for (1) obtaining information from the prospect, (2) developing two-way communication, and (3) increasing prospect participation. Learning Objective: 10-03 Topic: Using Questions Results in Sales Success Blooms: Understand AACSB: Communication Level of Difficulty: Medium 100. Why would a salesperson use an opinion approach? Answer: The opinion approach is especially good for the new salesperson because it shows that he or she values the buyer's opinion. Opinion questioning also shows that the salesperson will not challenge a potential buyer's expertise by spouting a memorized pitch. In addition, opinion questions can reveal previously unexplored opportunities for the salesperson's products to meet even more of the prospect's needs. Learning Objective: 10-01 Topic: The Approach—Opening the Sales Presentation Blooms: Analyze AACSB: Communication Level of Difficulty: HardChapter 11 - Elements of a Great Sales Presentation 11-1 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Chapter 11 Elements of a Great Sales Presentation Learning Objectives: 11-01 Discuss the purpose and essential steps of the sales presentation. 11-02 Give examples of the six sales presentation mix elements. 11-03 Describe difficulties that may arise during the sales presentation and explain how to handle them. 11-04 State how to handle discussion of the competition. 11-05 Explain the need to properly diagnose the prospect’s personality to determine the design of the sales presentation. True / False Questions 1. According to the Golden Rule of Selling, a salesperson who uses puffery in a sales presentation is more likely to make a sale than the one who does not. Answer: False Learning Objective: 11-01 Topic: The Golden Rule: Presentation Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: Truthfully showing and telling about your product shows you are a person with integrity and character who is focused on unselfishly helping this person. Should there be a hint of exaggeration or puffery, the buyer may not buy. 2. The main purpose of a sales presentation is to overcome objections. Answer: False Learning Objective: 11-01 Topic: The Purpose of the Presentation Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The main goal of your presentation is to provide information to the prospect. This information includes the discussion of your product, marketing plan, and business proposition. Overcoming objections may occur, but it is not the primary purpose. 3. In a sales situation, a prospect enters the conviction stage when he is convinced that the product is not only the best but also that the salesperson who is promoting the product is the best source to buy from. Answer: True Learning Objective: 11-01 Topic: The Purpose of the Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 11 - Elements of a Great Sales Presentation 11-2 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: You must convince the buyer not only that your product is the best but also that you are the best source to buy from. When this occurs, your prospect has moved into the conviction stage of the mental buying process. 4. Presentation is a continuation of the sales approach. Answer: True Learning Objective: 11-01 Topic: The Purpose of the Presentation Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The presentation is a continuation of the approach. The purpose of the presentation is to provide knowledge via the features, advantages, and benefits of your product, marketing plan, and business proposal. 5. A marketing plan explains what the customer will receive in return for buying the product or service. Answer: False Learning Objective: 11-01 Topic: Three Essential Steps within the Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: For wholesalers and retailers, the marketing plan is the suggestion on how they should resell the product. For end users, it is the suggestion on how they can use the product. 6. Although salespeople sell different products in different ways, the elements of the sales presentation mix should be used in an equal proportion. Answer: False Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Salespeople sell different products in different ways, but all salespeople use six classes of presentation elements to some degree in their presentations to provide meaningful information to the customer. These elements are called the presentation mix, and they are not necessarily used in equal amounts. 7. According to the text, the six elements of the sales presentation mix are product, participation, proof, visuals aids, persuasive communication, and demonstration. Answer: False Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: RememberChapter 11 - Elements of a Great Sales Presentation 11-3 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Easy Explanation: The sales presentation mix consists of six components: participation, proof, visual aids, dramatization, demonstration, and persuasive communication. 8. During a sales presentation, it is best to begin with the FAB sequence, then present the business proposition, and next the marketing plan. Answer: False Learning Objective: 11-01 Topic: Three Essential Steps within the Presentation Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The first step of the presentation should address the FABS of a product. Next, the salesperson should present the marketing plan followed by the business proposition. 9. Logical reasoning is an effective persuasive technique especially when selling complicated proposals. Answer: True Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The application of logic through reasoning is an effective persuasive technique that appeals to prospects’ common sense by requiring them to think about the proposition and to compare alternative solutions to problems. It can create excellent results when applied to selling computers, heavy equipment, communication systems and complex proposals. 10. Logical reasoning involves a presentation constructed around three parts: an overview, a major premise, and a trial close. Answer: False Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Logical reasoning involves a presentation constructed around three parts: a major premise, a minor premise, and a conclusion.Chapter 11 - Elements of a Great Sales Presentation 11-4 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 11. A salesperson says to a prospect, "Just imagine how this equipment will look and operate in your store. Your employees will perform much better, and they will thank you." This statement is an example of a suggestive proposition. Answer: False Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The statement exemplifies an autosuggestion, which attempts to have prospects imagine using and benefitting from the product. A suggestive proposition implies that the prospect should act now. 12. A public relations firm is trying to convince a former President of the U.S. that he needs their services. When the publicist says, "We currently are handling public relations for the royal family of Monaco, Prince Andrew of Great Britain, and Colin Powell," the public relations firm is using a prestige suggestion. Answer: True Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Prestige suggestions ask the prospect to visualize using products that famous people, companies, or persons the prospect trusts use. 13. A salesperson using a direct suggestion on a prospect might begin by saying, "Mr. and Mrs. Smith, just imagine never having to worry about money after your retirement." Answer: False Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Autosuggestion attempts to have prospects imagine using the product, such as in this case. The direct suggestion is used widely by professional salespeople in all industries because it does not “tell” but suggests buying, which does not offend the buyer. 14. A textbook salesperson says, "Instructors at Harvard and Yale really like this new approach." The salesperson is using a suggestive proposition. Answer: False Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Understand AACSB: AnalyticChapter 11 - Elements of a Great Sales Presentation 11-5 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: Suggestive propositions imply that the prospect should act now, which is not the case in this example. Prestige suggestions ask the prospect to visualize using products that famous people or organizations, such as Harvard, use. 15. Television commercials use autosuggestion frequently. Answer: True Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Autosuggestion attempts to have prospects imagine themselves using the product. The method is often used by TV advertisers. 16. A salesperson is likely to harm sales by personalizing relationships with customers. Answer: False Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: When salespeople show customers that they care about their best interests, sales have a tendency to improve. Such a relationship lets customers know they can trust the salesperson. 17. If prospects are allowed to hold your catalog, price list, or brochure during a presentation, it will increase the probability of sale. Answer: False Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Be sure to control the visual aids and any materials you use in the presentation. New salespeople often make the mistake of handing prospects their catalog, price list, or brochures showing several products. When buyers are looking through these items, chances are that they are not listening, which may lead to lost sales.Chapter 11 - Elements of a Great Sales Presentation 11-6 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 18. A simile is a direct comparison using "like" or "as." Answer: True Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A simile is a direct comparison statement using the word like or as: A poorly manicured lawn is like a bad haircut. 19. It is important for the salesperson using familiar terminology and buzzwords to speak in a formal tone to convey its importance. Answer: False Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: A salesperson should remember to talk the prospect’s language by using familiar terminology and buzzwords in a conversational tone. 20. In order to make the sale, it is not recommended that prospects participate in the sales presentation. Answer: False Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A major part of the presentation involves techniques for motivating the prospect to participate in the presentation, which is important in making a sale. Four ways to induce participation are questions, product use, visuals, and demonstrations. 21. Radio commercials are the best idea development tool for the dramatization of a product. Answer: False Learning Objective: 11-02 Topic: Dramatization Improves Your Chances Blooms: Remember AACSB: Analytic Level of Difficulty: EasyChapter 11 - Elements of a Great Sales Presentation 11-7 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: One of the best methods of developing ideas for the dramatization of a product is to watch television commercials. Products are presented using visuals, many products are demonstrated, and most products are dramatized. 22. The sales presentation should include elements that appeal to the prospect’s five senses. Answer: True Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: By letting prospects use the product, you can appeal to their senses: sight, sound, touch, smell, and taste. The presentation should be developed with appeals to the senses, since people often buy because of emotional needs and the senses are keys to developing emotional appeals. 23. Examples of proofs include past sales figures, independent research results, and testimonials. Answer: True Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Several useful proof techniques are the customer’s past sales figures, the guarantee, testimonials, company proof results, and independent research results. 24. Although they are useful with final consumers, testimonials from satisfied customers mean little to professional buyers, who think such "proof" is usually faked. Answer: False Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Testimonials in the presentation as proof of the product’s features, advantages, and benefits are an excellent method to build trust and confidence. Professional buyers are impressed by testimonials from prominent people, experts, and satisfied customers about a product’s features, advantages, and benefits.Chapter 11 - Elements of a Great Sales Presentation 11-8 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 25. Company-generated data usually has greater credibility than proof furnished by reputable sources outside the company. Answer: False Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Proof furnished by reputable sources outside the company usually has more credibility than company-generated data. Pharmaceutical salespeople frequently tell physicians about medical research findings on their products published in leading medical journals by medical research authorities. 26. Visuals integrated into sales presentations increase retention and reduce misunderstandings. Answer: True Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Visuals are most effective when you believe in them and have woven them into your sales presentation message. Use them to increase retention, reinforce the message, reduce misunderstanding, and create a unique and lasting impression. 27. When a prospect receives a personal phone call during a sales presentation, the salesperson should offer to leave the room. Answer: True Learning Objective: 11-03 Topic: Be Prepared for Presentation Difficulties Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: If a prospect receives a phone call during a presentation, the salesperson should determine if the discussion is personal or confidential. If so, by gesture or voice the salesperson should offer to leave the room—this is always appreciated by the prospect 28. Pictures, models, videotapes, films, or slides are the best alternatives if a demonstration is not feasible. Answer: True Learning Objective: 11-02 Topic: Demonstrations Prove It Blooms: Remember AACSB: Analytic Level of Difficulty: EasyChapter 11 - Elements of a Great Sales Presentation 11-9 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: It is best to show the product, if possible, and have the prospect use it. If this is not feasible, then pictures, models, videotapes, films, or slides are the best alternatives. 29. Demonstrations are appropriate for every sales presentation. Answer: False Learning Objective: 11-02 Topic: Demonstrations Prove It Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Demonstrations are appropriate for some but not all sales presentations. Not all products lend themselves to a demonstration. 30. To maintain the spontaneity of presentation, professional salespeople do not rehearse the presentation. Answer: False Learning Objective: 11-02 Topic: Demonstrations Prove It Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Rehearsing by practicing in front of a mirror, on a tape recorder, and/or on videotape is important to the success of using visual aids, dramatics, and demonstrations. Once you are ready to make the presentation, begin using it with less important prospects. This allows you time to refine the presentation before contacting more important accounts. 31. Before using a demonstration in a sales presentation, a salesperson should determine the probability that his or her demonstration will backfire. Answer: True Learning Objective: 11-02 Topic: Demonstrations Prove It Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Before giving a demonstration, a salesperson needs to determine the probability of a demonstration’s success and failure. Planning and organization improve the likelihood of success.Chapter 11 - Elements of a Great Sales Presentation 11-10 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 32. Audience, objective, structure, and visual aids are considerations in the sales presentation goal model. Answer: True Learning Objective: 11-01 Topic: The Sales Presentation Goal Model Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The sales presentation goal model consists of six questions to ask when creating a sales presentation. Questions address the salesperson’s objective, audience, staging, and visual aids. 33. It is common for interruptions to occur during a sales presentation. Answer: True Learning Objective: 11-03 Topic: Be Prepared for Presentation Difficulties Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Interruptions occur during presentations, and the salesperson needs to be prepared to deal with them. The salesperson should wait patiently to regain the prospect’s attention and then briefly restate the selling points. 34. A salesperson should refer to the competition at length during the approach and more briefly in trial closings. Answer: False Learning Objective: 11-04 Topic: Be Prepared for Presentation Difficulties Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: It is recommended that salespeople do not refer to a competitor unless absolutely necessary; acknowledge a competitor only briefly; and make a detailed comparison of their product and the competition’s product. Competition should not be mentioned during approach or trial close.Chapter 11 - Elements of a Great Sales Presentation 11-11 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 35. Industrial products salespeople are likely to make detailed comparisons to their competition and to stress customer service and product guarantees. Answer: True Learning Objective: 11-04 Topic: Be Prepared for Presentation Difficulties Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: At times, it is appropriate to make a detailed comparison of your product to a competing one, especially for industrial products. If products are similar, emphasize your company’s service, guarantees, and what you do personally for customers. Multiple Choice Questions 36. According to the Golden Rule of Selling, which of the following is essential for building a true relationship between the buyer and seller? A. Organized presentations B. Value pricing C. Qualified salespeople D. Continuous interaction E. Ethical service Answer: E Learning Objective: 11-01 Topic: The Golden Rule: Presentation Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: Providing ethical service is the key to a strong buyer-seller relationship. Truthfully showing and telling about your product shows you are a person with integrity and character who is focused on unselfishly helping this person.Chapter 11 - Elements of a Great Sales Presentation 11-12 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 37. The main goal of a sales presentation is to: A. provide information to the prospect. B. make a permanent impression on the prospect. C. help in closing the sale. D. reduce customer objections. E. ensure that the approach is positive. Answer: A Learning Objective: 11-01 Topic: The Purpose of the Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The main goal of your presentation is to provide information to the prospect. Once you have given your presentation, the person is in a much better position to know if your product should be purchased. 38. Which of the following lists the five purposes of the sales presentation? A. Desire, attitude, knowledge, beliefs, and attention B. Knowledge, beliefs, desire, attitude, and conviction C. Attitude, opinion, desire, beliefs, and action D. Attention, desire, opinion, conviction, and sale. E. Proof, action, opinion, conviction, and desire. Answer: B Learning Objective: 11-01 Topic: The Purpose of the Presentation Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The five purposes of a sales presentation are providing knowledge, developing positive personal beliefs about a product, triggering desire for the product, developing a positive attitude about the products, and building conviction to buy the product. 39. A salesperson should ask a prospect to buy only when the prospect reaches the _____ stage of the mental buying process. A. knowledge B. conviction C. belief D. desire E. need Answer: B Learning Objective: 11-01 Topic: The Purpose of the Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 11 - Elements of a Great Sales Presentation 11-13 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: You must move the prospect into the conviction stage before a sale is made. So hold off asking the prospect to buy until the conviction stage. Otherwise, this usually results in objections, failure to listen to your whole story, and fewer sales. 40. According to the text, what are the three essential steps within the sales presentation, in the correct order? A. Price, marketing plan, and FAB B. FAB, business proposition, and marketing plan C. Marketing plan, FAB, and business proposition D. Business proposition, FAB, and marketing plan E. FAB, marketing plan, and business proposition Answer: E Learning Objective: 11-01 Topic: Three Essential Steps within the Presentation Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The first step of any sales presentation is discussing the features, advantages, and benefits of the product. The second step is presenting the marketing plan, and the third step is explaining the business proposition. 41. The _____ refers to the elements the salesperson assembles to make sales to prospects and customers. A. business proposition B. sales presentation mix C. positioning strategy D. sales activities guide E. marketing mix Answer: B Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The sales presentation mix refers to the elements the salesperson assembles to sell to prospects and customers. While all elements should be part of the presentation, it is up to the individual to determine how much each element is emphasized.Chapter 11 - Elements of a Great Sales Presentation 11-14 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 42. One of the elements of the sales presentation mix is: A. creativity. B. product. C. proof. D. knowledge. E. probes. Answer: C Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The six components of the salesperson’s presentation mix include proof, visual aids, dramatization, demonstration, persuasive communication, and participation. 43. Logical reasoning is best described as a: A. persuasive sales technique that uses suggestions to encourage prospects to buy. B. method that uses a major premise, a minor premise, and a conclusion. C. method for personalizing the relationship between the buyer and the seller. D. tool that integrates visual aids, technology, and dramatization. E. diplomatic way of persuading a prospect to listen closely. Answer: B Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Logical reasoning involves a presentation constructed around three parts: a major premise, a minor premise, and a conclusion. 44. Which term refers to combining a question with a discussion of a product’s FABs? A. SWOT analysis B. Marketing mix C. SELL sequence D. Sales presentation mix E. Product dramatization Answer: C Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: When a question is coupled with discussing a product’s feature, advantage, and benefit, it forms the SELL Sequence. The SELL Sequence is an effective form of persuasive communication.Chapter 11 - Elements of a Great Sales Presentation 11-15 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 45. The salesperson should decide which element(s) of the presentation mix to emphasize in a particular presentation based primarily on: A. sales call objective, customer profile, and customer benefit plan. B. product newness, number of customers, and inventory levels. C. competitor activity, current inventory levels, and bonus plans. D. persuasive communication, competitor activity, and financial objectives. E. financial objectives, marketing plan, and diversification strategy. Answer: A Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: All elements of the sales presentation mix should be part of the presentation, but it is up to the individual to determine how much each element is emphasized. This determination is primarily based on the sales call objective, customer profile, and customer benefit plan. 46. A salesperson is LEAST likely to use visuals during a sales presentation to: A. reduce misunderstanding. B. increase prospect retention. C. exhibit professionalism. D. create a lasting impression. E. identify customer objections. Answer: E Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Visuals are primarily used in presentations to increase retention, show professionalism, reinforce a message, and create a unique and lasting impression. The trial close rather than visuals helps identify customer objections.Chapter 11 - Elements of a Great Sales Presentation 11-16 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 47. In a sales presentation, visual aids are important to sales success because customers are more likely to: A. request warranties. B. limit interruptions. C. retain details they hear. D. respond to direct questions. E. remember information that they see. Answer: E Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: People retain approximately 10 percent of what they hear but 50 percent of what they see. Consequently, you have five times the chance of making a lasting impression with an illustrated sales presentation than with words alone. 48. A(n) _____ type of suggestion implies that the prospect should act immediately. A. suggestive proposition B. countersuggestion C. autosuggestion D. prestige suggestion E. indirect suggestion Answer: A Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Suggestive propositions imply that the prospect should act now, such as, “Shouldn’t you go ahead and buy now before the price goes up next month?” Prospects often like to postpone their buying decisions, so the suggestive approach can help overcome this problem. 49. "Shouldn't you go ahead and buy now before the price increases next month?" is an example of a(n): A. autosuggestion. B. countersuggestion. C. suggestive proposition. D. indirect suggestion. E. prestige suggestion. Answer: C Learning Objective: 11-02 Topic: The Sales Presentation MixChapter 11 - Elements of a Great Sales Presentation 11-17 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Suggestive propositions imply that the prospect should act now, such as, “Shouldn’t you go ahead and buy now before the price goes up next month?” Prospects often like to postpone their buying decisions, so the suggestive approach can help overcome this problem. 50. "Since you anticipate using our braking system with your current machine, I suggest you buy now before we perform a planned retooling of our existing system. We know our current braking system is compatible with your machines, but I cannot promise the new design will be." This is an example of a(n): A. prestige suggestion. B. suggestive proposition. C. autosuggestion. D. countersuggestion. E. relational suggestion. Answer: B Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Suggestive propositions imply that the prospect should act now. Prospects often like to postpone their buying decisions, so the suggestive approach can help overcome this problem. 51. Lightener & Company designs restaurant interiors. When talking to a prospective customer, one of its salespeople says, "I sense that you really like the scheme we have developed for the waiting area, but you don't want to rush into making a decision. I must tell you that this wall covering is a limited edition and will not be available after the first of the month." This is an example of a(n): A. suggestive proposition. B. prestige suggestion. C. direct suggestion. D. autosuggestion. E. countersuggestion. Answer: A Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 11 - Elements of a Great Sales Presentation 11-18 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Suggestive propositions imply that the prospect should act now before prices increase or the item is no longer available. 52. _____ ask the prospect to visualize using products that famous people or companies use. A. Suggestive propositions B. Prestige suggestions C. Direct suggestions D. Autosuggestions E. Image suggestions Answer: B Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A prestige suggestion associates a product with people or organizations that the prospect trusts or admires. 53. "Eight of the top ten universities in the country are using this textbook." This type of suggestion is an example of a(n): A. suggestive proposition. B. direct suggestion. C. prestige suggestion. D. autosuggestion. E. indirect suggestion. Answer: C Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Prestige suggestions ask the prospect to visualize using products that famous people, companies, or persons the prospect trusts use. If the best universities use the textbook, then the prospect should use it as well.Chapter 11 - Elements of a Great Sales Presentation 11-19 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 54. "You ought to buy that scarf. It is just like the one I saw actress Julia Roberts wearing when she visited the Metropolitan Museum." The salesperson is making a(n): A. ideal-self suggestion. B. autosuggestion. C. countersuggestion. D. prestige suggestion. E. direct suggestion. Answer: D Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Prestige suggestions ask the prospect to visualize using a product that a famous person, such as Julia Roberts, uses. 55. A salesperson told one of his prospects, "Many of the Fortune 500 manufacturers are using our products. This elite group of manufacturers finds that the equipment helps increase their profits, sales, and market share." This is an example of a(n): A. ideal-self suggestion. B. prestige suggestion. C. direct suggestion. D. autosuggestion. E. suggestive proposition. Answer: B Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Prestige suggestions ask the prospect to visualize using products that famous people, companies, or persons the prospect trusts use. If the best firms use the product, then the prospect should use it as well. 56. _____ attempts to have prospects imagine using the product themselves. A. Suggestive proposition B. Prestige suggestion C. Empathetic suggestion D. Autosuggestion E. Countersuggestion Answer: D Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Remember AACSB: AnalyticChapter 11 - Elements of a Great Sales Presentation 11-20 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: An autosuggestion encourages a prospect to envision using the product themselves. TV commercials often use this method. 57. "Just picture how excited your daughter will be when you buy her this new convertible," is an example of a(n): A. suggestive proposition. B. prestige suggestion. C. direct suggestion. D. image suggestion. E. autosuggestion. Answer: E Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Autosuggestion attempts to have prospects imagine using the product themselves. The salesperson visualizes the product, saying, “Just imagine how this equipment will look and operate in your store.” 58. "Can you visualize how excited your family will be when you tell them you have purchased this Disneyland vacation package?" The salesperson is making a(n): A. autosuggestion. B. prestige suggestion. C. direct suggestion. D. suggestive proposition. E. empathetic suggestion. Answer: A Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Autosuggestion attempts to have prospects imagine purchasing and using the product themselves. The prospect is encouraged to visualize a vacation at Disneyland and the pleasure that would bring. 59. Which type of suggestion method seeks to create doubt about a competitor’s products? A. Suggestive proposition B. Empathic suggestion C. Manipulative suggestion D. Autosuggestion E. Indirect suggestion Answer: EChapter 11 - Elements of a Great Sales Presentation 11-21 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The indirect suggestion is used at times for some prospects when it is best to be indirect in suggesting a recommended course of action. Indirect suggestions help instill in prospects’ minds factors such as doubt about a competitor’s products or desire for your product. 60. Direct suggestions are commonly used by professional salespeople because they are: A. empathetic. B. conclusive. C. inoffensive. D. impersonal. E. logical. Answer: C Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The direct suggestion is used widely by professional salespeople in all industries because it does not “tell” but suggests buying, which does not offend the buyer.Chapter 11 - Elements of a Great Sales Presentation 11-22 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 61. "Based on your needs, I suggest you buy the model 1000 copier." The salesperson is making a(n): A. countersuggestion. B. prestige suggestion. C. autosuggestion. D. direct suggestion. E. indirect suggestion. Answer: D Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The direct suggestion is used widely by professional salespeople in all industries because it does not “tell” but suggests buying, which does not offend the buyer. Such a suggestion might state: “Based on our survey of your needs, I suggest you purchase Product X.” 62. What is considered the best visual aid to use during a sales presentation? A. Sample ads B. Product videos C. Customer testimonials D. The actual product E. The product manual Answer: D Learning Objective: 11-02 Topic: Visual Aids Help Tell the Story Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The best visual aid is the actual product. Sample ads, videos, testimonials, and manuals are less effective types of visual aids.Chapter 11 - Elements of a Great Sales Presentation 11-23 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 63. Which of the following statements about using dramatics in a sales presentation is most likely true? A. Using dramatic demonstrations fails to set a salesperson apart from the majority of other salespeople. B. A salesperson's own uncertainty about the use of dramatics increases the positive impact on the prospect. C. A theatrical movie showing the history of the company is an example of dramatization. D. Dramatics should be incorporated into all sales presentations due to their success rate. E. Television commercials are a source of ideas for dramatizations. Answer: E Learning Objective: 11-02 Topic: Dramatization Improves Your Chances Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: One of the best methods of developing ideas for the dramatization of a product is to watch television commercials. Products are presented using visuals, many products are demonstrated, and most products are dramatized. 64. As the pet storeowner was explaining her idea for a promotion, the salesperson asked, "Should you buy three or four cases of dog treats for your "Pamper Your Pet" promotion?" This is an example of a(n): A. counter offer. B. autosuggestion. C. prestige suggestion. D. manipulative suggestion. E. indirect suggestion. Answer: E Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The indirect suggestion is used at times for some prospects when it is best to be indirect in suggesting a recommended course of action, such as buying 3 or 4 cases of dog treats. Indirect suggestions help instill in prospects’ minds desire for your product.Chapter 11 - Elements of a Great Sales Presentation 11-24 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 65. The dairy salesman asked the store purchasing agent, "Do you think you'll need 10 or 12 pallets of ice cream for your "Summer Buster" sales promotion?" This is an example of a(n): A. indirect suggestion. B. autosuggestion. C. prestige suggestion. D. manipulative suggestion. E. counter offer. Answer: A Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The salesperson is using indirect suggestion by asking the customer about the size of the order. Indirect suggestions help instill in prospects’ minds desire for a product. 66. Which type of suggestion is intended to evoke an opposite response from the prospect? A. Countersuggestion B. Autosuggestion C. Prestige suggestion D. Manipulative suggestion E. Indirect suggestion Answer: A Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The countersuggestion evokes an opposite response from the prospect: “Do you really want such a high-quality product?” Often, the buyer will begin expanding on why a high-quality product is needed. This is an especially effective technique to include in the presentation if you have already determined that the prospect wants a high-quality product. 67. The real estate agent asked the young parents, "Do you really want to live so close to an elementary school?" This is an example of a(n): A. suggestive proposition. B. prestige suggestion. C. direct suggestion. D. autosuggestion. E. countersuggestion. Answer: E Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: UnderstandChapter 11 - Elements of a Great Sales Presentation 11-25 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Medium Explanation: The countersuggestion is an especially effective technique to include in the presentation if you have already determined that the prospect wants a high-quality product. For parents of young children, a home near a school would most likely be desirable. 68. Which of the following is NOT a valid reason for using dramatics in the sales presentation? A. To provide a clear explanation of the product B. To create two-way communications C. To capture the prospect's interest D. To increase the salesperson's persuasive powers E. To create a powerful proof technique Answer: E Learning Objective: 11-02 Topic: Dramatization Improves Your Chances Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Dramatics can be an effective tool in a sales presentation. Dramatizations explain a product, create two-way communication, capture interest, and increase persuasive abilities. However, dramatizations are not proof statements. 69. What response is most likely expected from a prospect when a salesperson uses a counter suggestion such as, "Do you really want an SUV with all of these extra features?” A. "I really don’t need all of these extras. We should look at less expensive SUVs." B. "Yes, this model has lots of features that aren't available on other SUVs." C. "Okay. Show me some other SUVs which are better than this." D. "Okay. What kind of SUV would you recommend we buy?" E. “We should consider an SUV with fewer features.” Answer: B Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: The salesperson most likely knows that the prospect wants a high quality SUV. The countersuggestion is an especially effective technique to include in the presentation if you have already determined that the prospect wants a high-quality product. Often, the buyer will begin expanding on why a high-quality product is needed.Chapter 11 - Elements of a Great Sales Presentation 11-26 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 70. According to the text, a salesperson can make sales presentations more persuasive through all of the following methods EXCEPT: A. personalizing customer relationships. B. making the sales presentation fun. C. building trust through honesty. D. controlling the sales presentation. E. referring often to the competition. Answer: E Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A sales presentation is more persuasive when the relationship with the customer is personalized and based on trust and honesty. The salesperson should control the presentation but also make it fun. However, the salesperson should avoid discussing the competition if possible. 71. What should the salesperson do if the prospect angrily challenges the veracity of the claims made about the product? A. Provide a countersuggestion quickly B. Stop the presentation immediately C. Defend the claims aggressively D. Correct the prospect politely E. Act diplomatically Answer: E Learning Objective: 11-03 Topic: The Sales Presentation Mix Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: The salesperson has to be a diplomat in cases in which tempers rise and prospects are wrong but feel they are correct and will not change their opinions. Retreat may be the best option; otherwise, you risk destroying the relationship. If you challenge the prospect, you could win the battle only to lose the war. 72. Which of the following is considered the best nonverbal selling technique? A. Erect posture B. Firm handshake C. Pleasant smile D. Frequent eye contact E. Stylish appearance Answer: C Learning Objective: 11-02 Topic: The Sales Presentation MixChapter 11 - Elements of a Great Sales Presentation 11-27 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Blooms: Remember AACSB: Communication Level of Difficulty: Easy Explanation: The best nonverbal selling technique is the smile. As a sales manager once said, “It’s often not what you say but how you say it, and you can say almost anything to anyone if you do it with a smile.” 73. A salesperson says, "Castrol GTX protects your car engine. It's like having a dust cover for your engine." The salesperson is using a(n): A. simile. B. analogy. C. metaphor. D. parable. E. image. Answer: B Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The analogy compares two different situations that have something in common such as an oil filter and a dust filter. 74. Which of the following refers to a brief story used to illustrate a point and to compare something familiar to something unfamiliar? A. Metaphor B. Simile C. Analogy D. Parable E. Imagery Answer: D Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A parable is a brief story used to illustrate a point. Parables compare something familiar to something unfamiliar.Chapter 11 - Elements of a Great Sales Presentation 11-28 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 75. When two situations have something in common, they can be effectively compared by using a(n): A. metaphor. B. simile. C. analogy. D. parable. E. imagery. Answer: C Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Remember AACSB: Communication Level of Difficulty: Easy Explanation: The analogy compares two different situations that have something in common such as a sun screen on a house and a shade tree in front of a window. 76. A Bounty paper towel salesperson shows a prospect how quickly the towel absorbs spilled coffee. This is an example of: A. demonstration. B. analogy marketing. C. excessive dramatization. D. indirect suggestion. E. direct suggestion. Answer: A Learning Objective: 11-02 Topic: Demonstrations Prove It Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The salesperson is using a demonstration to convince a prospect that Bounty towels are absorbent. 77. Demonstrations, dramatics, and visual aids in sales presentation are most likely used for all of the following reasons EXCEPT: A. comparing competitor’s products. B. creating two-way communication. C. engaging the prospect through participation. D. capturing the prospect's attention and interest. E. allowing the prospect to set the stage for closing the sale. Answer: A Learning Objective: 11-02 Topic: Demonstrations Prove It Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 11 - Elements of a Great Sales Presentation 11-29 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Visual aids, dramatics, and demonstrations are important to the salesperson’s success in selling a prospect. The reasons to use them include wanting to capture attention and interest, create two-way communication, involve the prospect through participation, and increase a salesperson’s persuasive powers. 78. Which of the following is typically used to explain how something works? A. Metaphor B. Simile C. Alliteration D. Parable E. Anagram Answer: D Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Similes and metaphors are typically used to describe something while analogies and parables are typically used to explain how something works. 79. Which of the following is most likely true about proof statements? A. Survey results from magazines are invalid proof statements. B. Proof statements can substantiate a salesperson’s product claims. C. Past sales records are weak proof statements and infrequently used. D. Company proof results are the most credible type of proof statements. E. Proof statements encourage two-way communication with customers. Answer: B Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: By incorporating proof statements into the presentation, the salesperson can increase the prospect’s confidence and trust that product claims are accurate. Proof furnished by reputable sources outside the company usually has more credibility than companygenerated data.Chapter 11 - Elements of a Great Sales Presentation 11-30 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 80. Which type of proof statement would be best for a salesperson trying to convince a current customer to place a larger order? A. Research results from independent studies B. Past sales figures of the buyer C. Guarantees and warranties D. Customer testimonials E. Proof results of the seller Answer: B Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: Salespersons frequently use customers’ past sales proof statements when contacting present customers. Customers keep records of their past purchases from each of their suppliers; the salesperson can use these to suggest what quantities of each product to purchase. 81. To show the strength of a plastic pallet, the salesperson asked a group of prospects to step into the parking lot and watch as he drove his car across a pallet. He then got out of the car and asked a prospect to examine the pallet for cracks or breaks. This theatrical presentation of a product's feature is called: A. dramatization. B. analogy marketing. C. countersuggestion. D. prestige proof statement. E. autosuggestion. Answer: A Learning Objective: 11-02 Topic: Dramatization Improves Your Chances Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Dramatics refers to talking or presenting the product in a striking, showy, or extravagant manner. Thus, sales expertise can involve dramatization or a theatrical presentation of products, such as driving over pallets to exhibit the strength of the plastic. 82. Which of the following statements about the use of demonstrations in sales presentations is true? A. Rehearsed demonstrations bore prospects. B. Industrial product presentations require demonstrations. C. Demonstrations should be appropriate and appear natural. D. Demonstrations do not backfire when a product is well-made. E. Effective demonstrations involve complex products for end users. Answer: CChapter 11 - Elements of a Great Sales Presentation 11-31 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Learning Objective: 11-02 Topic: Demonstrations Prove It Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Demonstrations should be appropriate and well-rehearsed to be effective. Demonstrations are not required for certain products, and they do not have to be complicated. 83. Which of the following questions is part of the sales presentation goal model? A. How will you introduce yourself and the firm? B. What suggestion technique will be suitable? C. What features and benefits will you emphasize? D. How will you design and display visual aids? E. What approach method would be appropriate? Answer: D Learning Objective: 11-02 Topic: The Sales Presentation Goal Model Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The sales presentation goal model consists of six questions that are intended to help determine which sales presentation mix elements to use. Questions relate to visual aids, audience, and presentation structure. 84. To have an effective demonstration in a sales presentation, you, as the salesperson, should: A. conduct unrehearsed and natural demonstrations. B. develop an all-purpose demonstration for most selling situations. C. encourage prospect participation in the demonstration. D. require the prospect to perform a complex task. E. attempt trial closes before the demonstration. Answer: C Learning Objective: 11-02 Topic: Demonstrations Prove It Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Effective demonstrations encourage the prospect to participate in simple tasks or answer questions. Demonstrations should be practiced and should be specific for each selling situation.Chapter 11 - Elements of a Great Sales Presentation 11-32 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 85. Which of the following is an example of a guideline to follow when using visual aids, dramatics, and demonstrations? A. Let the presentation come naturally; do not rehearse. B. Avoid trial closes during a demonstration. C. Make your sales objectives simple, clear, and straightforward. D. Maintain control by discouraging prospect participation. E. Use a memorized sales presentation to ensure that no FAB is omitted. Answer: C Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Presentations should be rehearsed but not memorized, and sales objectives should be clear. Trial closes during demonstrations are appropriate, and demonstrations benefit from customer participation. 86. Lena Getz has just finished demonstrating the durability of her company's upholstery fabric. To find out if this feature is important to her prospect, she should: A. use a trial close. B. hand a catalog to the prospect. C. use a probing question. D. use the questions approach. E. lead into a benefit. Answer: A Learning Objective: 11-02 Topic: Demonstrations Prove It Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Lena should incorporate trial closes (questions) after showing or demonstrating a major feature, advantage, or benefit to determine if the prospect believes the presentation and considers it important. 87. What is the primary purpose of the sales presentation goal model? A. Minimizing unfavorable features B. Maintaining two-way communication C. Choosing the best marketing mix components to stress D. Capturing the prospect's attention during a sales presentation E. Determining which elements of the sales presentation mix to use Answer: E Learning Objective: 11-02 Topic: The Sales Presentation Goal Model Blooms: Understand AACSB: AnalyticChapter 11 - Elements of a Great Sales Presentation 11-33 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: The sales presentation goal model consists of six questions that are intended to help determine which sales presentation mix elements to use. Questions relate to the objective, audience, and presentation structure. 88. You are a salesperson for a manufacturer of neonatal incubators. While you are making the presentation, your prospect, a hospital administrator, receives a telephone call. What should you do if you determine this is a personal call? A. Insist the hospital administrator ignore the call since this is your appointed time. B. Look over the material you previously covered and prepare a written summary. C. Politely request for the attention of the prospect. D. Remain quiet and wait for the prospect to finish talking. E. Offer to leave the room. Answer: E Learning Objective: 11-03 Topic: Be Prepared for Presentation Difficulties Blooms: Remember AACSB: Communication Level of Difficulty: Easy Explanation: If the call is personal, then the salesperson should respect the customer’s privacy and leave the room. If the call is business-related, it would be acceptable to wait quietly for the conversation to finish. 89. Imagine that you are trying to sell baby furniture to a daycare owner. You are in the midst of your presentation when one of your prospect's employees enters the room to talk about a sick child. After a 10-minute conversation, the employee leaves. The daycare owner turns to you and says, "Now what were we discussing?" You should: A. briefly restate the selling points in which the daycare owner was most interested. B. continue with the rest of the presentation after some small talk. C. continue the presentation from where you stopped. D. offer to reschedule your appointment. E. start your presentation from scratch. Answer: A Learning Objective: 11-03 Topic: Be Prepared for Presentation Difficulties Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: After an interruption it is best to restate the last important points that were discussed before proceeding as planned. Starting from the beginning are rescheduling would be a waste of time.Chapter 11 - Elements of a Great Sales Presentation 11-34 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 90. Which of the following statements is true about how you, as a salesperson, should cope with the competition during a sales presentation? A. It is impossible to develop a sales presentation without specifically referring to the competition. B. Comments about the competition should be based on information gathered from other salespeople. C. When selling industrial products, avoid making detailed comparisons with a competitor. D. Ignore customer comments and questions about a competitor's product. E. Negative comments about a competitive product may insult the prospect. Answer: E Learning Objective: 11-04 Topic: Be Prepared for Presentation Difficulties Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A prospect may have loyalties with a competitor, so negative comments should be avoided. Discussing the competition depends on the situation, but it should be based on fact rather than rumor. Salespeople of industrial products are likely to make detailed comparisons with the competition. Essay Questions 91. What is logical reasoning? Provide an example to illustrate your answer. Answer: Logical reasoning is an effective persuasive technique that appeals to prospects' common sense by requiring them to think about the proposition and to compare alternative solutions to problems. Logical reasoning involves a presentation constructed around three parts: a major premise, a minor premise and a conclusion. 1. Major premise: All manufacturers wish to reduce costs and increase efficiency. 2. Minor premise: My equipment will reduce your costs and increase your efficiency. 3. Conclusion: Therefore, you should buy my equipment. Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Apply AACSB: Analytic Level of Difficulty: Hard 92. What is the purpose of the presentation? Answer: It provides knowledge via the features, advantages, and benefits of your product, marketing plan, and proposal. It allows the buyer to develop positive personal beliefs about your product. These beliefs result in desire (or need) for your product. The presentation helps turn the need into a positive attitude toward your product so that the buyer feels that your product is the best to fill his need and that you are the best person to supply that product. When this is accomplished, the buyer will have a conviction, and the sale will close. Learning Objective: 11-01Chapter 11 - Elements of a Great Sales Presentation 11-35 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Topic: The Purpose of the Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 93. Describe three types of suggestions used by salespeople. Provide an example of each to illustrate your answer. Answer: Suggestions can be used effectively to persuade prospects. The skilled use of suggestions can arouse attention, interest, desire, conviction, and action. There are six types of suggestions and they are used for different situations. Suggestive propositions imply that the prospect should act now, such as, "Shouldn't you go ahead and buy now before the price goes up next month?" This suggestion can be used if the prospect is delaying the decision. Prestige suggestions ask the prospect to visualize using products that famous people, companies, or persons the prospect trusts use, such as "The American President uses this product." Autosuggestion attempts to have prospects imagine themselves using the product. These are generally used in television advertisements. The direct suggestion directly suggests the prospect to buy a product. It can be used for directly suggesting the prospect to buy a product without offending him/her. It does not tell or request the prospect to buy instead it suggests to buy. The indirect suggestion is used at times for some prospects when it is best to be indirect in suggesting a recommended course of action. Indirect suggestions help instill in prospects' minds factors such as doubt about a competitor's products or desire for your product. The counter suggestion evokes an opposite response from the prospect: "Do you really want this high quality product?" This is effective if you have already determined that the prospect wants a high-quality product. Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Apply AACSB: Analytic Level of Difficulty: HardChapter 11 - Elements of a Great Sales Presentation 11-36 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 94. What are the three essential steps of sales presentation? Answer:The three essential steps in a sales presentation are: (1) Fully discuss the features, advantages, and benefits of the product. (2) Present your marketing plan. For wholesalers and retailers, this is your suggestion on how they should resell the product. For end users, it is your suggestion on how they can use the product. (3) Explain your business proposition. This step relates the value of your product to its cost. It should be discussed last, since you always want to present your product's benefits and marketing plan relative to your product's price. Learning Objective: 11-01 Topic: Three Essential Steps within the Presentation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 95. Differentiate between similes, metaphors, analogies, and parables. How do salespeople use these communication tools? Answer: Communication tools such as similes, metaphors, analogies, and parables can be used in the sales presentation. A simile is a direct comparison statement using the word like or as. A metaphor is an implied comparison that uses a contrasting word or phrase to evoke a vivid image. The analogy compares two different situations that have something in common. A parable is a brief story used to illustrate a point. Words are communication tools. Similes, metaphors, analogies, and parables are effective methods of gaining prospects’ attention and capturing their interest in a proposal. Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Analyze AACSB: Communication Level of Difficulty: Hard 96. What are proof statements? Why do salespeople often use proof statements? Answer: Proof statements are a means of proving that the product’s benefits and the salesperson’s proposals are legitimate. Because salespeople often have a reputation for exaggeration, at times prospects are skeptical of the salesperson’s claims. By incorporating proof statements into the presentation, the salesperson can increase the prospect’s confidence and trust that product claims are accurate. Several useful proof techniques are the customer’s past sales figures, the guarantee, testimonials, company proof results, and independent research results. Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 11 - Elements of a Great Sales Presentation 11-37 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 97. List any six visual aids commonly used in sales presentations. Answer: Some common visuals are: (1) The product, (2) charts and graphics illustrating product features and advantages, (3) photographs and videos of the product and its uses, (4) product models, (5) sales manuals and product catalogs, (6) order forms, (7) letters of testimony, (8) a copy of the guarantee, (9) flip boards and posters, (10) sample advertisements, and (11) equipment such as slides and computers. Learning Objective: 11-02 Topic: Visual Aids Help Tell the Story Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 98. Imagine that you are talking to the owner of a motel chain about buying furniture from your company. His secretary comes in and asks him to sign some papers immediately. He takes about ten minutes to read over the papers before he signs them. What should you as the professional salesperson do? Answer: Wait quietly and patiently until you have regained the prospect's full attention. Restart your presentation by briefly restating the selling points you have already mentioned. Do something to increase the prospect's participation in the presentation. If interest is regained, move deeper into your presentation. Learning Objective: 11-03 Topic: Be Prepared for Presentation Difficulties Blooms: Apply AACSB: Analytic Level of Difficulty: Hard 99. What are four ways to involve a prospect in a demonstration? Answer: The four ways of involving a prospect in a demonstration are: (1) letting the prospect do something simple, (2) letting the prospect work an important feature, (3) letting the prospect do something routine, and (4) letting the prospect answer questions during the presentation. Learning Objective: 11-02 Topic: The Sales Presentation Mix Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 11 - Elements of a Great Sales Presentation 11-38 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 100. What are three reasons for using visuals aids, dramatics, and demonstrations during sales presentations? Answer: Visual aids, dramatics, and demonstrations are important to the salesperson's success in selling to a prospect. The reasons to use them include wanting to (1) capture attention and interest, (2) create two-way communication, (3) involve the prospect through participation, (4) afford a more complete and clear explanation of products, and (5) help obtain positive commitments regarding a product's single feature, advantage, or benefit. Learning Objective: 11-02 Topic: Demonstrations Prove It Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 12 - Welcome Your Prospect's Objections 12-1 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Chapter 12 Welcome Your Prospect's Objections Learning Objectives: 12-01 Explain why you should welcome a prospect’s objections. 12-02 Describe what to do when objections arise. 12-03 Discuss seven basic points to consider in meeting a prospect’s objections. 12-04 Explain six major categories of prospect objections, and give an example of how to handle each of them. 12-05 Present, illustrate, and use in your presentation several techniques for meeting prospect objections. 12-06 Describe what to do after meeting an objection. True / False Questions 1. Sales objections should be welcomed. Answer: True Learning Objective: 12-01 Topic: Welcome Objections! Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: When a prospect first gives an objection, smile, because that’s when you start earning your salary. An objection indicates the prospect is interested. 2. According to the Golden Rule of Selling, the salesperson should always leave immediately when a prospect says "No, I do not need your product." Answer: False Learning Objective: 12-01 Topic: The Golden Rule: Objections Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: Whether or not a salesperson should leave after being rejected depends on whether the prospect is correct about not needing the product and what the purpose of the sales call is.Chapter 12 - Welcome Your Prospect's Objections 12-2 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 3. A salesperson should be prepared to respond to a prospect's objection at any time during the presentation. Answer: True Learning Objective: 12-01 Topic: Objections and the Sales Process Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Objections can occur at any time during a presentation, and salespeople need to be prepared to handle them appropriately. 4. In planning for objections, a salesperson should focus exclusively on the reasons why a prospect should buy. Answer: False Learning Objective: 12-03 Topic: Basic Points to Consider in Meeting Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Plan for objections that your presentation might raise. Consider not only the reasons that prospects should buy but why they should not buy. Structure your presentation to minimize the disadvantages of your product. 5. To forestall means to discuss objections as soon as they are raised. Answer: False Learning Objective: 12-03 Topic: Basic Points to Consider in Meeting Objections Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Forestalling the objection has the salesperson discussing an objection before the prospect raises it. It often is better to forestall or discuss objections before they arise. The sales presentation can be developed to address anticipated objections directly.Chapter 12 - Welcome Your Prospect's Objections 12-3 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 6. Do not deny objections even if they are based on incorrect information. Answer: False Learning Objective: 12-03 Topic: Basic Points to Consider in Meeting Objections Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: At times, the prospect may raise objections based on incorrect information. Politely deny false objections. 7. The salesperson should postpone all of the prospect’s objections to the end of sales presentation to maintain control of the presentation. Answer: False Learning Objective: 12-03 Topic: Basic Points to Consider in Meeting Objections Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: At times, situations arise in which it is best to postpone your answer to an objection. However, it is best to meet objections as they arise; postponement may cause a negative mental picture or reaction. 8. Sometimes, prospects appear to be making objections when they are actually requesting more information. Answer: True Learning Objective: 12-03 Topic: Basic Points to Consider in Meeting Objections Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: It is important to listen to prospects because many times what appears to be an objection is actually a request for additional information. A prospect who wants more information may be in the conviction stage.Chapter 12 - Welcome Your Prospect's Objections 12-4 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 9. Opposition or resistance to the information provided by a salesperson is called a sales objection. Answer: True Learning Objective: 12-01 Topic: What Are Objections? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Opposition or resistance to information or to the salesperson’s request is labeled a sales objection. Welcome sales objections because they indicate prospect interest and help determine what stage the prospect has reached in the buying cycle—attention, interest, desire, conviction, or readiness to close. 10. Negotiation refers to reaching an agreement that is mutually satisfactory to both buyer and seller. Answer: True Learning Objective: 12-03 Topic: Basic Points to Consider in Meeting Objections Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Often, conditions stated by the prospect are overcome through negotiation between buyer and seller. Negotiation refers to reaching an agreement mutually satisfactory to both buyer and seller. 11. A hopeless objection is one that cannot be solved or answered by the salesperson. Answer: True Learning Objective: 12-03 Topic: Basic Points to Consider in Meeting Objections Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A hopeless objection is one that cannot be solved or answered, such as I already have one, I’m bankrupt, and I’d like to buy your life insurance, but the doctor gives me only 30 days to live. Hopeless objections cannot be overcome.Chapter 12 - Welcome Your Prospect's Objections 12-5 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 12. The Quaker Oats salesperson should most likely be ready for the stalling type of objection when selling a new cereal to retail buyers. Answer: True Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: One of the toughest stalls to overcome arises in selling a new consumer product. Retail buyers are reluctant to stock consumer goods that customers have not yet asked for, even new goods produced by large, established consumer product manufacturers, such as Quaker Oats. 13. A salesperson’s objective in dealing with a stall is to help prospects evaluate the reasons for and against buying now. Answer: True Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Your goal in dealing with a stall is to help prospects realistically examine reasons for and against buying now. If you are absolutely sure it is not in their best interest to buy now, tell them so. 14. Prospects seldom use the no-need objection because it is rude. Answer: False Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The no-need objection is used widely because it politely gets rid of the salesperson. While not always a valid objection, the no-need response strongly implies the end of a sales call.Chapter 12 - Welcome Your Prospect's Objections 12-6 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 15. A prospect says "I’ll think it over." This can be treated as a no-need objection. Answer: False Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: “I’ll think it over” is an example of a stalling objection. “It sounds interesting, but I’m not interested right now” is an example of a no-need objection. 16. "Your competitor's product is better” This is an example of source objection. Answer: False Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A product objection occurs when a customer claims a competing product is better. A source objection occurs when the customer dislikes the salesperson or the company. 17. A salesperson has a greater chance of sales success by offering the lowest price. Answer: False Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Many salespeople think that offering the lowest price gives them a greater chance of sales success. Generally, this is not the case. You might even state that your product is not the least expensive one available because of its benefits and advantages and the satisfaction it provides. Once you convey this concept to your buyer, price becomes a secondary factor that usually can be handled successfully. 18. The price/value formula helps a salesperson respond to a customer’s price objection. Answer: True Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The price/value formula is not the answer to “Your price is too high.” It is only a description of the buyer’s thinking process and an explanation of why the so-called price objection is heard so often. It tells us what we must do to answer the price objection.Chapter 12 - Welcome Your Prospect's Objections 12-7 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 19. A prospect says, "I cannot afford a $500 monthly car payment." A salesperson should feel confident that the prospect is setting a condition. Answer: False Learning Objective: 12-03 Topic: Basic Points to Consider in Meeting Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The salesperson cannot tell yet if the prospect is setting a condition or making an objection. If the prospect said he only earns $800 a month, then the prospect has clearly set a condition. 20. Usually, handling a source objection requires calling on the prospect routinely over a period to break this resistance barrier. Answer: True Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Source objections relate loyalty to a present supplier or salesperson. Also, the prospect may not like you or your company. Handling a source objection requires calling on the prospect routinely over a period because it takes time to break this resistance barrier. 21. A salesperson should never dodge an objection. Answer: False Learning Objective: 12-05 Topic: Techniques for Meeting Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The dodge is an objection-handling technique that can be used by itself or in combination with other techniques. You would use the dodge only once in a presentation. 22. The dodge method of handling an objection involves turning a prospect's objection into a reason to buy. Answer: False Learning Objective: 12-05 Topic: Techniques for Meeting Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: It is called the dodge because the salesperson neither denies, answers, nor ignores the objection, but simply temporarily dodges it. The salesperson may say, “Before you decide to buy…” in order to transition to a positive communication with the prospect.Chapter 12 - Welcome Your Prospect's Objections 12-8 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 23. Most objections can be easily rephrased into questions. Answer: True Learning Objective: 12-05 Topic: Techniques for Meeting Objections Blooms: Remember AACSB: Communication Level of Difficulty: Easy Explanation: Since it is easier to answer a question than to overcome an objection, counter an objection with a rephrasing question when you can do so naturally. Most objections are easily rephrased. 24. A prospect says, "I don't like your color choices." The salesperson responds, "Before you decide to buy, let me tell you about our credit plan." This salesperson is using a boomerang technique. Answer: False Learning Objective: 12-05 Topic: Techniques for Meeting Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The boomerang method converts an objection into a benefit. The salesperson in this scenario is using the dodge method. 25. "I would prefer to buy a used SUV rather than the new models you are selling." This is an example of product objection. Answer: True Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The customer is objecting to the product by stating a preference for used models rather than the new one being sold.Chapter 12 - Welcome Your Prospect's Objections 12-9 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 26. Price is the primary objection to postpone if you have not had the opportunity to discuss product benefits. Answer: True Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Normally, respond to the objection immediately except when a price objection is raised. Price is the primary objection to postpone if you have not had the opportunity to discuss product benefits. If you have discussed the product fully, then respond to the price objection immediately. 27. Conditions and hopeless objections cannot be handled by negotiation. Answer: False Learning Objective: 12-03 Topic: Basic Points to Consider in Meeting Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Often, conditions stated by the prospect are overcome through negotiation between buyer and seller. Negotiation refers to reaching an agreement mutually satisfactory to both buyer and seller. 28. A salesperson told a prospect, "I agree. Our price is a little higher, but so is our quality. Are you interested in saving $1,200 a year on maintenance?" This statement is an example of indirect denial. Answer: True Learning Objective: 12-05 Topic: Techniques for Meeting Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The indirect denial begins with an agreement or an acknowledgment of the prospect’s position: Yes, but; I agree; and, I appreciate how you feel. These phrases allow the salesperson to tactfully respond to the objection. 29. The difference between the direct and indirect denial is that the latter is more tactful and courteous. Answer: True Learning Objective: 12-05 Topic: Techniques for Meeting Objections Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 12 - Welcome Your Prospect's Objections 12-10 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: An indirect denial is different from a direct denial in that it initially appears as an agreement with the customer’s objection, but then moves into a denial of the fundamental issue in the objection. The difference between the direct denial and the indirect denial is that the indirect denial is softer, more tactful, and more courteous. 30. The indirect denial begins with an agreement or an acknowledgment of the prospect's position. Answer: True Learning Objective: 12-05 Topic: Techniques for Meeting Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: An indirect denial initially appears as an agreement with the customer’s objection, but then moves into a denial of the fundamental issue in the objection. The indirect denial is tactful and courteous. 31. The compensation method of handling objections is also known as the boomerang method. Answer: False Learning Objective: 12-05 Topic: Techniques for Meeting Objections Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The boomerang and compensation methods are different ways to handle objections. The boomerang method involves convincing a prospect that an objection is a benefit. The compensation method involves showing how a product has benefits that justify any negative aspects. 32. The compensation method is effective in handling a valid objection. Answer: True Learning Objective: 12-05 Topic: Techniques for Meeting Objections Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Sometimes a prospect’s objection is valid and calls for the compensation method. Several reasons for buying must exist to justify or compensate for a negative aspect of making a purchase.Chapter 12 - Welcome Your Prospect's Objections 12-11 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 33. A proof statement can be used when letting a third party respond to an objection. Answer: True Learning Objective: 12-05 Topic: Techniques for Meeting Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: An effective technique for responding to an objection is to answer it by giving a third-party answer and using someone else’s experience as your proof of testimony. Salespeople use a wide range of proof statements today, such as testimonials and independent studies. 34. After responding to an objection, the salesperson should immediately ask for the order. Answer: False Learning Objective: 12-06 Topic: After Meeting the Objection—What to Do? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: After meeting an objection at any time during the interview, you need to know if you have overcome the objection. So, after responding to the objection, use a trial close to determine if you have overcome the objection. Requesting an order should not occur until it has been confirmed that the objection was overcome. 35. If you are 100 percent sure that you cannot overcome the objection and that the prospect will not buy, it is better to leave the prospect's office without asking for an order. Answer: False Learning Objective: 12-06 Topic: After Meeting the Objection—What to Do? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: If you are 100 percent sure that you cannot overcome the objection and that the prospect will not buy, go ahead and close. Always ask for the order because the prospect may surprise you and make a purchase.Chapter 12 - Welcome Your Prospect's Objections 12-12 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Multiple Choice Questions 36. Which of the following statements is NOT a reason that explains why a salesperson should welcome prospect objections? A. Objections show the prospect is interested in the presentation. B. Objections help the salesperson know what stage in the buying cycle the prospect has reached. C. Most customer objections are raised at the closing stages of a sales presentation. D. Objections show the prospect wants to know about the salesperson's offer. E. Some customers raise objections because they want and need more information. Answer: C Learning Objective: 12-01 Topic: Objections and the Sales Process Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Objections occur at any time during the sales process not just during closing. Objections indicate a prospect is interested and may need additional information about a product. 37. What should a salesperson do after finishing the sales presentation? A. Use a trial close to determine the prospect’s attitude B. Wait for a positive response from the buyer C. Ask the prospect for a purchase order D. Request a summary from the prospect E. Present multiple proof statements Answer: A Learning Objective: 12-01 Topic: Objections and the Sales Process Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Experienced, successful salespeople have learned to address objections during the presentation. After the presentation, they use a trial close to determine the prospect’s attitude toward the product and if it is time to close.Chapter 12 - Welcome Your Prospect's Objections 12-13 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 38. Which term refers to opposition or resistance by the prospect to information or to the salesperson's request? A. Sales condition B. Arbitration C. Negotiation D. Trial close E. Sales objection Answer: E Learning Objective: 12-01 Topic: What Are Objections? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Opposition or resistance to information or to the salesperson’s request is labeled a sales objection. Sales objections indicate prospect interest and help determine what stage the prospect has reached in the buying cycle. 39. _____ refers to the salesperson discussing an objection before a prospect has the opportunity to ask about it. A. Anticipating B. Obstructing C. Dodging D. Forestalling E. Negotiation Answer: D Learning Objective: 12-03 Topic: Basic Points to Consider in Meeting Objections Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Forestalling the objection has the salesperson discussing an objection before the prospect raises it. It often is better to forestall or discuss objections before they arise.Chapter 12 - Welcome Your Prospect's Objections 12-14 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 40. Lowell is anticipating an objection from his prospect concerning the quality of the adhesives his company sells. He plans to weave into the early part of his presentation information about the product's recent "best buy" rating from a consumer information magazine before the prospect can bring up the quality issue. Which of the following methods is used by Lowell for meeting this objection? A. Indirect denial B. Postponing C. Objection preemption D. Forestalling E. Objection dodging Answer: D Learning Objective: 12-03 Topic: Basic Points to Consider in Meeting Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Lowell is using forestalling. Forestalling the objection has the salesperson discussing an objection before the prospect raises it. It often is better to forestall or discuss objections before they arise. 41. Early in his presentation, before the maintenance supervisor even mentioned cost, Andrew said, "You're going to notice our wax is higher priced because of the extra ingredients that make it last 50 percent longer between applications than ordinary wax." Andrew is using: A. indirect denial. B. forestalling. C. objection preemption. D. postponing. E. objection dodging. Answer: B Learning Objective: 12-03 Topic: Basic Points to Consider in Meeting Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Andrew is using forestalling to address a likely objection. Forestalling the objection has the salesperson discussing an objection before the prospect raises it. It often is better to forestall or discuss objections before they arise.Chapter 12 - Welcome Your Prospect's Objections 12-15 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 42. When an objection turns into a condition of sale, it most likely means that: A. the prospect does not like the guarantee provided with the product. B. the prospect does not have decision-making authority. C. if the salesperson meets the prospect's request, the prospect will buy. D. the prospect does not like the payment terms offered. E. the objection is true and cannot be overcome by the salesperson. Answer: C Learning Objective: 12-03 Topic: Basic Points to Consider in Meeting Objections Blooms: Analyze AACSB: Analytic Level of Difficulty: Hard Explanation: At times, prospects may raise an objection that turns into a condition of the sale. They are saying, “If you can meet my request, I’ll buy,” or “Under certain conditions, I will buy from you.” If you sense that the objection is a condition, quickly determine if you can help the prospect meet it. If you cannot, close the interview politely. 43. When the prospect said, "I know that your company usually ships in batches of six dozen cases, but I don't have room to store that much merchandise." The salesperson must first: A. try to negotiate with the customer to make a sale. B. determine if the prospect is setting a condition. C. smoke out the hidden and hopeless objections. D. use a dodge to create interest in the prospect. E. determine if the objection is major or minor. Answer: B Learning Objective: 12-03 Topic: Basic Points to Consider in Meeting Objections Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: The salesperson first needs to determine if the prospect’s objection is a hopeless objection, a condition of sale, or a true objection. If it is a true objection, then the salesperson should determine if it is major or minor.Chapter 12 - Welcome Your Prospect's Objections 12-16 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 44. _____ refers to reaching an agreement that is mutually satisfactory to both buyer and seller. A. Collaboration B. Strategic allying C. Negotiation D. Partnering E. Teamwork Answer: C Learning Objective: 12-03 Topic: Basic Points to Consider in Meeting Objections Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Negotiation refers to reaching an agreement mutually satisfactory to both buyer and seller. Often, conditions stated by the prospect are overcome through negotiation between buyer and seller. 45. The two broad categories of objections are ____, which can never be solved and ____, which can be answered. A. potential; actual B. hopeless; answerable C. superficial; actual D. feigned; real E. generic; specialized Answer: B Learning Objective: 12-03 Topic: Basic Points to Consider in Meeting Objections Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: There are two broad categories of objections: hopeless and true. A hopeless objection is one that cannot be solved or answered. The true objection can be answered. 46. Which of the following is an example of a practical objection? A. Resistance to spending money B. Dislikes making decisions C. Delivery schedule issues D. Negative image of a salesperson E. Predetermined beliefs Answer: C Learning Objective: 12-03 Topic: Basic Points to Consider in Meeting Objections Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 12 - Welcome Your Prospect's Objections 12-17 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Practical objections include delivery schedules and price. Psychological objections include resistance to spending money and predetermined beliefs. 47. What are the two types of answerable objections? A. Pragmatic and conditional B. Practical and impractical C. Direct and indirect D. Major and minor E. Objective and subjective Answer: D Learning Objective: 12-03 Topic: Basic Points to Consider in Meeting Objections Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Major and minor objections are the two main types of true objections that are answerable. Major and minor objections can be either practical or psychological. 48. A practical objection is considered as a(n) _____ objection. A. covert B. superficial C. psychological D. physiological E. overt Answer: E Learning Objective: 12-03 Topic: Basic Points to Consider in Meeting Objections Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Objections, minor or major, can be practical (overt) objections or psychological (hidden) objections in nature. 49. A psychological objection is considered as a(n) _____ objection. A. covert B. hidden C. superficial D. physiological E. overt Answer: B Learning Objective: 12-03 Topic: Basic Points to Consider in Meeting Objections Blooms: Remember AACSB: Analytic Level of Difficulty: EasyChapter 12 - Welcome Your Prospect's Objections 12-18 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Objections, minor or major, can be practical (overt) objections or psychological (hidden) objections in nature. 50. Prospects who ask trivial, unimportant questions or conceal their feelings beneath a veil of silence most likely have _____ objections. A. product B. hidden C. hopeless D. superficial E. source Answer: B Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Hidden objections occur when a prospect does not consciously know what their real objections to a product are. 51. What is the salesperson's best course of action when dealing with a hidden objection? A. Using a trial close B. Ignoring the objection C. Forestalling until the closing statements D. Trying to uncover the objection with questions E. Countering the objection with a proof statement Answer: D Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A salesperson faced with hidden objections should try to get the buyer to reveal the real objection. The salesperson can ask questions and make observations to smoke out the real objection.Chapter 12 - Welcome Your Prospect's Objections 12-19 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 52. An objections such as "I'll think it over," is simply a smoke screen designed to get rid of a salesperson. This objection is an example of a _____ objection. A. source B. product C. stalling D. no-need E. money Answer: C Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Stalling objections are used by prospects to get rid of salespeople. The prospect claims to be busy or unable to make a decision. 53. Which of the following is the best example of a stalling objection? A. "Your price is too high for the quality." B. "Your competitor makes a more efficient refrigeration unit." C. "You've got to do better than that with the price and financing." D. "Sounds good! I'll need to clear it with my boss before I can make a purchase." E. "I think you have a great product, but at this moment we don't need a new security system." Answer: D Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Stalling objections are used to make a salesperson leave. A prospect that claims a decision will be made later or by someone else is stalling. 54. Assume the prospect says, "I really like the ergonomic design of the office furniture you are selling, but I need to ask my boss about it before I buy." According to the text, which of the following would NOT be an appropriate response for the salesperson to make? A. "What are some of the issues you want to talk to him about?" B. "Did you need to ask about financing or get his approval to buy?" C. "Good! I'll call you later in the day." D. "If it was up to you, would you buy now?" E. "If you had the authority, you would go ahead with the purchase, wouldn't you?" Answer: C Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Apply AACSB: Communication Level of Difficulty: HardChapter 12 - Welcome Your Prospect's Objections 12-20 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: The salesperson should ask a question when faced with a stalling objection rather than saying he will call back later in the day. Questions might uncover the real objections to making the purchase. 55. Janette Hue sells vending machines. Her goal when dealing with a stalling objection is to: A. outline disadvantages of the competition’s product or service. B. help the prospect examine reasons for and against buying now. C. provide the prospect with helpful visual aids and brochures. D. make the prospect mad enough to take some kind of action. E. prevent the prospect from making a hasty decision. Answer: B Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Her goal in dealing with a stall is to help prospects realistically examine reasons for and against buying now. Discussing the competition or providing brochures is distracting and not productive. 56. Assume that a salesperson has asked a prospect to buy three cases of coffee, and the prospect responds with a stalling objection. The salesperson should then: A. present the benefits of purchasing now. B. close again and test the reaction. C. use a trial close. D. agree and leave. E. restart the presentation. Answer: A Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: The salesperson should not be satisfied with a stall or false objection. It is best to mention the benefits of the purchase. A trial close would most likely result in more objections and a firm denial.Chapter 12 - Welcome Your Prospect's Objections 12-21 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 57. The _____ objection is used widely because it politely gets rid of the salesperson. A. hidden B. product C. no-need D. stalling E. money Answer: C Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The no-need objection is used often as a polite way to get rid of a salesperson. The method shuts down many salespeople and ends the sales call. 58. As the restaurant equipment salesperson finished his basic presentation, his prospect said, "Sounds good. I really like what you had to say, and I know you have a good product, but I'm not interested now. Our present product works well. We will stay with it." Standing up to conclude the interview, the prospect says, "Thank you for coming by." What kind of objection is the salesperson experiencing? A. Hidden objection B. Source objection C. Money objection D. No-need objection E. Product objection Answer: D Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A no-need objection occurs when the prospect says what the currently have is fine and other product are not necessary. It is used often as a polite way to get rid of a salesperson. 59. Which of the following statements about the no-need objection is most likely true? A. Some salespeople actually encourage their prospects to make this kind of an objection because their sales presentation is poor. B. Once the no-need objection is expressed the salesperson should stop the presentation and try a close. C. No-need objections relate directly to the product. D. No-need objections are typically handled through forestalling. E. Such objections are rarely used because it is a rude way to get rid of a salesperson. Answer: AChapter 12 - Welcome Your Prospect's Objections 12-22 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: No-need objections are often caused by poor selling skills, and they are often used as a polite way to get rid of a salesperson. A no-need objection should lead the salesperson to ask more questions. 60. When a salesperson selling a table saw asked for the sale, the prospect responded, "I'm happy with the saw I'm now using." The prospect is using a _____ objection. A. hidden B. conditional C. stalling D. no-need E. money Answer: D Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The prospect’s current table saw is fine, and a new one is unneeded, which is a no-need objection. It is used often as a polite way to get rid of a salesperson. 61. Which among the following is the best example of a no-need objection? A. "I have to think this over before I buy." B. "I plan to wait until fall before I buy a new car." C. "I am pleased with the performance of the car I have now." D. "I can't afford a new car at this time." E. "I want to buy from a more established car dealer." Answer: C Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A prospect who is satisfied with their current car has no need for a new one. An objection about price or dealership relates to a money or source objection.Chapter 12 - Welcome Your Prospect's Objections 12-23 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 62. Which among the following is the best example of a money objection? A. "I cannot really afford to purchase a new car right now because I just moved.” B. "I only buy from veteran salespeople who can carry through on their promises." C. "I really like these figurines, but I can't stock them in this store without consulting the owner." D. "I'm sorry, but we have plenty of cleaning supplies and won't be ordering any more until the first of the year." E. "I'm satisfied with the brand of pet products we are stocking now." Answer: A Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The money objection encompasses several forms of economic excuses: I have no money, I don’t have that much money, It costs too much, or Your price is too high. These objections are simple for the buyer to say. 63. Which formula best describes the relationship among price, cost, and value? A. Cost/Price = Value B. Price/Value = Cost C. Value/Price = Cost D. Cost/Value = Price E. Price*Cost = Value Answer: B Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Cost is calculated by dividing price by value. Value is what the prospect sees the product doing for them and/or their company. 64. Which of the following statements about the price/value formula is true? A. The price/value formula is used to deal with product objections. B. Value within the price/value formula does not change. C. Price refers to the total package of benefits. D. Price divided by value equals cost. E. The buyer is concerned only with price. Answer: D Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Understand AACSB: AnalyticChapter 12 - Welcome Your Prospect's Objections 12-24 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: Cost is calculated by dividing price by value. Value is what the prospect sees the product doing for them and/or their company. Value is the solution you provide to the buyer’s problems with a money objection. 65. The prospect says, "I like your company's accounting software package, but our employees just don't have the time to learn a new system." This is an example of a _____ objection. A. stalling B. conditional C. money D. product E. source Answer: D Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A product objection occurs when a buyer worries about the risks associated with purchasing and using an unknown product. The buyer may be using a competing product with satisfaction. 66. The price/value formula teaches the professional salesperson to: A. smoke out stalling objections. B. meet a price objection by increasing the perceived value of a product. C. to handle objections in a specific order from hidden to price objections. D. equate price and cost to potential buyers. E. overcome objections as they arise. Answer: B Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: In the price/value formula, the value is what the prospect sees the product doing for them and/or their company. Value is the total package of benefits you have built for the prospect. Value is the solution you provide to the buyer’s problems with the price of a product.Chapter 12 - Welcome Your Prospect's Objections 12-25 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 67. "The copier we have still makes great copies," says your prospect. Which major category of objection are you experiencing? A. Stalling B. Money C. Hidden D. Product E. Source Answer: D Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The prospect is happy with his current equipment and gives a product objection. You might counter the objection with testimonials, research, or warranty information. 68. Which of the following is an example of a source objection that a salesperson for a small publishing company might hear from a bookstore owner? A. "I only deal with large, well-established publishing companies." B. "Your books are priced too high." C. "I don't take risks with books by new authors." D. "I am satisfied with the amount of stock I currently have.” E. "I'm too busy to talk to you now." Answer: A Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Source objections relate loyalty to a present supplier or salesperson. Also, the prospect may not like you or your company. 69. _____ objections relate loyalty to a present supplier or salesperson. A. Source B. Distribution C. Reseller D. Channel E. No-need Answer: A Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Remember AACSB: Analytic Level of Difficulty: EasyChapter 12 - Welcome Your Prospect's Objections 12-26 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Source objections relate loyalty to a present supplier or salesperson. Also, the prospect may not like you or your company. 70. The prospect says, "Your company has only been in business for two years. I like to buy from established companies." The prospect is using a _____ objection. A. stalling B. covert C. no-need D. hidden E. source Answer: E Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The prospect has given a source objection. Source objections relate loyalty to a present supplier or salesperson. 71. Alex sells veterinarian supplies. He has developed a close relationship with his customers. Which type of objection is Alex LEAST likely to hear when he tries to get one of his veterinarian customers to purchase a new type of flea and tick shampoo? A. No-need B. Money C. Source D. Stalling E. Product Answer: C Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Source objections occur when a buyer is loyal to a salesperson and does not want to make a change. Alex would not receive a source objection from current customers, although he might receive a non-need, money, stalling, or product objection.Chapter 12 - Welcome Your Prospect's Objections 12-27 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 72. Which of the following is the best example of a source objection? A. "I want to buy from a more established car dealer." B. "I prefer to buy a used car." C. "I am happy with the vehicle I am currently driving." D. "I cannot afford a large monthly payment." E. "I'll get back to you later after my wife and I have decided which car we like." Answer: A Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Source objections are based on loyalty to a present supplier or a dislike for another company. The prospect wants a car but not from this particular car dealer. 73. When the prospect asked, "Will I get a 2-year service warranty on this heating system?" The salesperson responded, "Before you decide to buy, let me tell you about how this new timer will save you money." What method was the salesperson using to meet the prospect’s objection? A. Boomerang B. Rephrase C. Compensation D. Forestall E. Dodge Answer: E Learning Objective: 12-05 Topic: Techniques for Meeting Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: With the dodge technique, the salesperson neither denies, answers, nor ignores an objection. The salesperson uses the phrase, “Before you decide to buy….”Chapter 12 - Welcome Your Prospect's Objections 12-28 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 74. The prospect asked, "Does this display case come with its own lighting system?" The salesperson responded with, "Before you decide to buy, notice how the doors to the case can be easily secured against tampering." What method was the salesperson using to meet this objection? A. Boomerang B. Rephrase the objection as a question C. Dodge D. Forestall E. Compensation Answer: C Learning Objective: 12-05 Topic: Techniques for Meeting Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: With the dodge technique, the salesperson neither denies, answers, nor ignores an objection. The salesperson uses a phrase like, “Before you decide to buy…” or “Let me tell you about….” 75. The prospect says, "Your price is two percent higher than your competitor's." The salesperson responds, "What you're saying is you want to get the best product for your money—right?" The salesperson is using which technique for meeting objections? A. Boomerang B. Rephrase C. Compensation D. Counterbalance E. Dodge Answer: B Learning Objective: 12-05 Topic: Techniques for Meeting Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The salesperson is rephrasing the objection into a question. The salesperson acknowledges the viewpoint and the rephrases. 76. A prospect tells a salesperson, “I’m not interested in the type of products that you sell.” The salesperson responds with, “Why?” The salesperson has used the ________ approach for meeting objections. A. pass up B. dodge C. denial D. postpone E. boomerang Answer: A Learning Objective: 12-05Chapter 12 - Welcome Your Prospect's Objections 12-29 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Topic: Techniques for Meeting Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: When a salesperson responds by asking why a prospect is not interested in the product, the salesperson is using the pass up approach to ignore the objection and move into a sales presentation. 77. The "Feel-Felt-Found" technique for meeting an objection is a variation of the _____ method. A. rephrasing B. boomerang C. compensation D. forestalling E. direct denial Answer: A Learning Objective: 12-05 Topic: Techniques for Meeting Objections Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A variation of rephrasing an objection as a question is the Feel- Felt- Found method. In this method, the salesperson first acknowledges the prospect’s viewpoint, saying, “John, I understand how you feel. Bill at XYZ store felt the same way, but he found, after reviewing our total program of products and services, that he would profit by buying now.” 78. Which of the following is a positive method for dealing with price issues during the business proposition phase? A. The product costs $5,000. B. Your rate will be only prime plus two. C. You can pay the total price over a series of months. D. How much would you like to pay us every month? E. We'll take off $6,000 to trade in your used car. Answer: B Learning Objective: 12-05 Topic: Techniques for Meeting Objections Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Using words like only and investment make price more positive and tolerable for prospects. The terminology softens the facts and figures.Chapter 12 - Welcome Your Prospect's Objections 12-30 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 79. You are working at your part-time job in a hardware store near a campus. A customer in the paint department complains that the new tops on the paint thinner seem hard to remove. You reply, "Yes, they are. They're designed that way so that children can't get into the thinner." You have just used the _____ technique. A. boomerang B. compensation C. pass up D. direct denial E. forestalling Answer: A Learning Objective: 12-05 Topic: Techniques for Meeting Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: By convincing the prospect that an objection is a benefit, you have turned the buyer immediately in favor of your product. This is the heart of the boomerang method. 80. Which method aids a salesperson to turn an objection into a reason to buy? A. Boomerang B. Postpone C. Deny D. Compensation E. Forestall Answer: A Learning Objective: 12-05 Topic: Techniques for Meeting Objections Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: By convincing the prospect that an objection is a benefit, you have turned the buyer immediately in favor of your product. This is the heart of the boomerang method.Chapter 12 - Welcome Your Prospect's Objections 12-31 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 81. You are calling the purchase manager of a hotel to sell a hydro seeder for their garden. The buyer tells you, "I know that your spray arms get rusted easily." You know that the spray arms are made up of stainless steel and will not get rusted easily. Which technique is best suited in handling this objection? A. Dodging B. Boomerang C. Questioning D. Direct denial E. Indirect Denial Answer: D Learning Objective: 12-05 Topic: Techniques for Meeting Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The salesperson is facing an objection that is incomplete or incorrect. The salesperson should acknowledge the prospect’s viewpoint; then answer the question by providing the complete or correct facts. A direct denial based on facts, logic, and politeness can effectively overcome the objection. 82. Assume the salesperson for a janitorial service completes the sales presentation and asks for the order. The prospect says, "No, I'm not ready to buy now. Try me again later next month." Which of the following techniques for handling objections should the salesperson use? A. Boomerang B. Five-question sequence C. Direct denial D. FAB sequence E. Indirect denial Answer: B Learning Objective: 12-05 Topic: Techniques for Meeting Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The salesperson needs to quickly determine why a prospect won’t buy. The fivequestion sequence helps overcome objections in such situations.Chapter 12 - Welcome Your Prospect's Objections 12-32 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 83. The prospect tells the realtor, "I like the ranch-style house a lot, but I can get more space in the one the other real estate agent showed me and the price is $2,000 less." The salesperson replies, "Yes, but this house is about ten years newer, has more modern appliances, and is better insulated." What method is being used to handle this objection? A. Direct denial B. Anticipation C. Boomerang D. Forestalling E. Indirect denial Answer: E Learning Objective: 12-05 Topic: Techniques for Meeting Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: “Yes, but” indicates that the realtor is using an indirect denial. An indirect denial is different from a direct denial in that it initially appears as an agreement with the customer’s objection but then moves into a denial of the fundamental issue in the objection. 84. Jessica sells exercise equipment to health clubs and similar facilities. During a sales call, her prospect says, "Our clients are quite happy with the results they are getting from the use of our current equipment." This is an example of a _____ objection. A. stalling B. dodging C. hidden D. product E. process Answer: D Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The prospect has given a product objection. A product objection occurs when a buyer worries about the risks associated with purchasing and using an unknown product. The buyer is using a competing product with satisfaction.Chapter 12 - Welcome Your Prospect's Objections 12-33 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 85. According to the text, tact is particularly crucial in using the _____ technique for handling objections to avoid offending the prospect. A. pass over B. rephrasing C. direct denial D. pre-emptive E. indirect denial Answer: C Learning Objective: 12-05 Topic: Techniques for Meeting Objections Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Tact is critical in using a direct denial. A sarcastic or arrogant response can alienate a prospect. However, a direct denial based on facts, logic, and politeness can effectively overcome the objection. 86. The counterbalance method of dealing with objections is also known as the _____ method. A. price B. compensation C. trade-off D. reciprocal E. return-on-investment Answer: B Learning Objective: 12-05 Topic: Techniques for Meeting Objections Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The compensation method is also known as the counterbalance method.Chapter 12 - Welcome Your Prospect's Objections 12-34 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 87. When the prospect's objection is valid, it calls for: A. the boomerang method. B. the compensation method. C. the direct denial method. D. the indirect denial method. E. rephrasing of the objection. Answer: B Learning Objective: 12-05 Topic: Techniques for Meeting Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Sometimes a prospect’s objection is valid and calls for the compensation method Several reasons for buying must exist to justify or compensate for a negative aspect of making a purchase. 88. An effective way to respond to some objections is to use someone else's experience as proof. This technique is called the: A. jury of executive opinion method. B. outside reference technique. C. third-party answer technique. D. boomerang method. E. counterbalance method. Answer: C Learning Objective: 12-05 Topic: Techniques for Meeting Objections Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: An effective technique for responding to an objection is to answer it by giving a third-party answer and using someone else’s experience as your proof of testimony. Salespeople use a wide range of proof statements today, such as testimonials and statistics. 89. After dealing with a prospect's objection, the very next thing the professional salesperson should do is to: A. apply the FAB sequence. B. use the 5-question sequence. C. return to the SELL sequence. D. conduct a trial close. E. continue the presentation. Answer: D Learning Objective: 12-06 Topic: After Meeting the Objection—What to Do? Blooms: Remember AACSB: AnalyticChapter 12 - Welcome Your Prospect's Objections 12-35 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: After meeting an objection at any time during the interview, you need to know if you have overcome the objection. This can be determined through a trial close. 90. Which of the following is NOT an example of what a pharmaceutical salesperson should say immediately after dealing with a prospect's objection? A. "Shall I write up your order now?" B. "Wasn't that what you wanted to hear?" C. "Have I adequately clarified our credit policies?" D. "That solves that inventory problem, doesn't it?" E. "With that issue of product safety settled, don't you think that we can go ahead?" Answer: A Learning Objective: 12-06 Topic: After Meeting the Objection—What to Do? Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: After handling an objection at any time during the interview, you need to know if you have overcome the objection. This can be determined through a trial close like “Have I adequately clarified our credit policies?” Essay Questions 91. Why should salespeople welcome sales objections? Answer: Sales objections must be welcomed because they show the prospect is interested and help determine what stage the prospect has reached in the buying cycle-attention, interest, desire, conviction, or action. Learning Objective: 12-01 Topic: Welcome Objections! Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 92. Why is it important to handle objections as they arise? Answer: The prospect might stop listening until you address the objection, or feel that you are trying to hide something, or that you also know it is a real problem, or that you cannot answer it, or that you are not interested in the prospect's problems with the product. Learning Objective: 12-03 Topic: Basic Points to Consider in Meeting Objections Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 12 - Welcome Your Prospect's Objections 12-36 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 93. Why is it important to listen to the whole objection? Answer: The prospect will think that something is wrong if you jump in too hard and too fast. He will feel pushed and uneasy. You also might not really hear his objection and start to answer a different one. Further, it is irritating to the prospect to be interrupted. Learning Objective: 12-03 Topic: Basic Points to Consider in Meeting Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 94. Christopher Wright, a salesman of 3S Computers, is preparing for a very important sales call and needs to be prepared for customer objections. What are the general guidelines that Christopher should review regarding how to handle objections? Answer: Christopher should do the following to meet the objections. (1) Plan for the objections. (2) Anticipate and forestall objections. (3) Handle objections as they arise. (4) Be positive. (5) Listen and understand the objections. (6) Meet the objections. Learning Objective: 12-03 Topic: Basic Points to Consider in Meeting Objections Blooms: Understand AACSB: Communication Level of Difficulty: Medium 95. When the Nova Chemicals salesperson walked into the office of a company that uses chemicals in its manufacture of plastic molds, the buyer looked up and said, "I'm too busy to see any salesperson today." What type of objection did the buyer use? How should the salesperson respond? Answer: The buyer used a stalling objection. The salesperson should respond by determining if the prospect is telling the truth or is using a stalling objection to get rid of him. Additionally, he could enquire as to what would be the best time for them to meet. Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Apply AACSB: Analytic Level of Difficulty: HardChapter 12 - Welcome Your Prospect's Objections 12-37 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 96. How can salespeople use technology when responding to objections? Answer: Providing buyers the necessary information to make a decision can frequently overcome objections. Data stored in handheld computers or laptops, or obtained using a telephone modem or satellite transmission, can provide information to overcome buyers’ objections. Computers can be used to show buyers their past purchases of products, project future sales, and check on available products and shipment schedules. Technology can be incorporated easily into most, if not all, of the techniques for meeting objections. Anytime you need to provide information to buyers, you can create a technological method of presenting data in an accurate and dramatic manner. Learning Objective: 12-02 Topic: Technology Can Effectively Help Respond to Objections! Blooms: Apply AACSB: Technology Level of Difficulty: Hard 97. How should a professional salesperson handle a source objection? Answer: The source objection usually requires calling on the prospect routinely over a period of time. It takes time to break down this resistance barrier. Get to know the prospect and the prospect's needs. Show true interest in the prospect. Do not try to get all of the prospect's business at once—go for a small order the first time. Learning Objective: 12-04 Topic: Six Major Categories of Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 98. Give examples of practical and psychological objections. Answer: Practical objections include price, product is not needed, product has an overstock and delivery schedules. Psychological objections include resistance to spend money, resistance to domination, predetermined beliefs, negative image of salespeople and dislike for making buying decisions. Learning Objective: 12-03 Topic: Basic Points to Consider in Meeting Objections Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 12 - Welcome Your Prospect's Objections 12-38 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 99. Why is postponing an objection necessary sometimes? Answer: Postponing an objection is not failing to answer it. Postponing is done when the prospect skips ahead of you in a presentation. But if you think that the presentation will eventually handle this objection to your prospect's satisfaction, and that the prospect is willing to wait until later in the presentation, you can politely postpone the objection. You must deal with it tactfully, letting the prospect know that it will be dealt with shortly. This leaves you in control of the presentation. Learning Objective: 12-05 Topic: Techniques for Meeting Objections Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 100. Briefly describe how a salesperson would use the boomerang method to handle a prospect’s objections. Answer: The boomerang method turns an objection into a reason to buy. Boomeranging an objection requires good timing and quick thinking. Experience in a particular selling field, knowledge of your prospect's needs, a positive attitude, and a willingness to stand up to the objection are necessary attributes for successful use of this technique. Example of the boomerang technique: Handling the container, the prospect said: Prospect: They look nice, but I don't like them as well as my others. The tops seem hard to remove. Salesperson: Yes, they are hard to remove. We designed them so that children couldn't get into the medicine. Isn't that a great safety measure? Learning Objective: 12-05 Topic: Techniques for Meeting Objections Blooms: Apply AACSB: Analytic Level of Difficulty: HardChapter 13 - Closing Begins the Relationship 13-1 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Chapter 13 Closing Begins the Relationship Learning Objectives: 13-01 Explain when to close. 13-02 Describe what to do if your prospect asks for more information, gives an objection, or says no when you ask for the order. 13-03 Explain why you must prepare to close more than once. 13-04 Discuss the 12 keys to a successful close. 13-05 Present, illustrate, and use several techniques for closing the sale in your presentation. 13-06 Construct a multiple-close sequence. True / False Questions 1. According to the Golden Rule, a salesperson should not close the sale if the product is not suitable for the customer. Answer: True Learning Objective: 13-01 Topic: The Golden Rule: Closing Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: The Golden Rule salesperson wants to know if a product fulfills the prospect‟s need or solves problem. In closing, it is extremely important to think about the purpose of the sales call—unselfish service to the other person. 2. Closing is the process of helping people make decisions that will benefit them. Answer: True Learning Objective: 13-01 Topic: When Should I Pop the Question? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Closing is the process of helping people make a decision that will benefit them. You help people make the decision by asking them to buy. 3. Salespeople should not attempt to close a sale before completing the sales presentation. Answer: False Learning Objective: 13-01 Topic: When Should I Pop the Question? Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 13 - Closing Begins the Relationship 13-2 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Closing is appropriate when the prospect is ready, which may be as early as the approach stage. However, in most cases, close occurs after the presentation. 4. A buying signal refers to anything the prospect says or does to indicate a readiness to buy. Answer: True Learning Objective: 13-01 Topic: Reading Buying Signals Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A buying signal refers to anything that prospects say or do indicating they are ready to buy. Buying signals hint that prospects are in the conviction stage of the buying process. 5. You are calling on a new prospect. During the sales call, the prospect carefully scrutinizes the sample product that you have given him. This is an example of a buying signal. Answer: True Learning Objective: 13-02 Topic: Reading Buying Signals Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: When a prospect carefully scrutinizes your product or seems to contemplate the purchase, this may be an indirect request for prompting and a buying signal. 6. A prospect that becomes increasingly anxious during a sales presentation is sending a buying signal. Answer: False Learning Objective: 13-02 Topic: Reading Buying Signals Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Once the prospect decides to purchase a product, the pressure of the buying situation is eliminated. A state of visible anxiety changes to relaxation because the customer believes that the salesperson is a friend; however, a prospect becoming more anxious is not ready to buy.Chapter 13 - Closing Begins the Relationship 13-3 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 7. A retail salesman explains the features of a television. After listening to the salesman, the prospect asks, "How much is it?" This question is clearly an objection. Answer: False Learning Objective: 13-02 Topic: Reading Buying Signals Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Asking questions may be a buying signal in some cases. The salesman should ask a question to determine the prospect‟s thoughts. If the prospect answers positively, there is probably a high degree of interest. 8. A salesperson should attempt a close only once. To do otherwise makes the prospect think the salesperson is pushy. Answer: False Learning Objective: 13-03 Topic: What Makes a Good Closer? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The successful salesperson does not stop with the prospect‟s first no but attempts multiple closes. If a customer says no, the salesperson should determine the nature of the objection and then return to the presentation. 9. It is appropriate to use a trial close after discussing information relative to overcoming the objection. Answer: True Learning Objective: 13-02 Topic: What Makes a Good Closer? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: After discussing information relative to overcoming the objection, a salesperson should use a trial close to determine if the objection has been overcome and if there are other objections.Chapter 13 - Closing Begins the Relationship 13-4 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 10. A salesperson should ask for the order and remain silent until the buyer responds. Answer: True Learning Objective: 13-01 Topic: What Makes a Good Closer? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: No matter when or how you close, remember that when you ask for the order, it is important to be silent. Do not say a word. If you say something—anything—you increase the probability of losing the sale. 11. Three closes is the maximum number of closes for any given sales presentation. Answer: False Learning Objective: 13-03 Topic: How Many Times Should You Close? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Three closes is a minimum for successful salespeople. Three to five wellexecuted closes should not offend a prospect, but more than five may become bothersome. 12. If you find your prospect is in a bad or hostile mood, it is usually a good idea to avoid trying to close. Answer: False Learning Objective: 13-02 Topic: Closing under Fire Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: To close more sales effectively, never take the first no from the prospect to mean an absolute refusal to buy. You must be able to ask a prospect who may be in a bad mood or even hostile toward you to buy. 13. Successful salespeople ask the closing question and then briefly summarize the product‟s benefits. Answer: False Learning Objective: 13-01 Topic: What Makes a Good Closer? Blooms: Remember AACSB: Communication Level of Difficulty: Easy Explanation: Good closers are able to wait silently for a response from the prospect after asking for an order. Talking while waiting for a response is likely to trigger a lost sale.Chapter 13 - Closing Begins the Relationship 13-5 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 14. According to the text, closing the sale should be the hardest part of the presentation. Answer: False Learning Objective: 13-01 Topic: Difficulties with Closing Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Closing the sale is the easiest part of the presentation. It is a natural wrap-up to your sales presentation because you solidify details of the purchase agreement. However, salespeople sometimes have difficulty closing the sale. 15. The salesperson should not slow down a presentation even if the prospect is a slow thinker. Answer: False Learning Objective: 13-04 Topic: Essentials of Closing Sales Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Closings should be tailored to each prospect. A slow thinking or indecisive prospect may require a salesperson to slow down the presentation or answer more questions. 16. The alternative-choice close allows prospects to choose between buying and not buying the product from the salesperson. Answer: False Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The alternative choice does not give prospects a choice of buying or not buying, but asks which one or how many items they want to buy. 17. "Will you need one box of nails or two to go with those roofing shingles?" is an example of an alternative-choice close. Answer: True Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The alternative choice does not give prospects a choice of buying or not buying, but asks which one or how many items they want to buy. The salesperson is asking if one or two boxes of nails is needed.Chapter 13 - Closing Begins the Relationship 13-6 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 18. Robert, a pharmaceutical sales representative, is calling on the purchasing executive of a hospital for the first time. The assumptive closing technique is best suited for this sales call. Answer: False Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: With the assumptive close, the salesperson assumes the prospect will buy because the customer and salesperson have done business together many times in the past. If Robert is making a first-time sales call, the assumptive closing technique would be inappropriate. 19. The summary of benefits close is extremely useful if it targets a specific prospect's personality. Answer: False Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The compliment close is effective when targeting the personality of a prospect. By complimenting prospects, they listen and respond favorably to a sales presentation. The summary of benefits close highlights the prospect‟s favorite aspects of a sales presentation. 20. The compliment close is particularly effective when you are calling on a prospect who has a big ego. Answer: True Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The compliment close is especially effective when you talk with a prospect who is a self-styled expert, who has a big ego, or who is in a bad mood. Would-be experts and egotistical prospects value their own opinions. By complimenting them, they listen and respond favorably to your presentation. 21. Some prospects view the continuous-yes close as an insult to their intelligence. Answer: True Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Understand AACSB: AnalyticChapter 13 - Closing Begins the Relationship 13-7 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: In the continuous-yes close, the salesperson develops a series of benefit questions that the prospect must answer. Suspicious prospects may view a continuous-yes close as trickery or as an insult to their intelligence rather than aiding a purchase decision. 22. The minor-points close is similar to the balance-sheet close. Answer: False Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The minor-points close is similar to the alternative-choice close. Both methods involve giving the buyer a choice between two options. 23. The statement, "I'll place that order for six pallets of potting soil right now," is an example of an unethical close. Answer: False Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: With the assumptive close, the salesperson assumes the prospect will buy. Statements can be made such as “I‟ll call your order in tonight” or “I‟ll have this shipped to you tomorrow.” If the prospect does not say anything, assume the suggested order has been accepted. Such a closing method would be unethical if the prospect indicated that the order was unwanted. 24. The T-account close is also called the minor-points close. Answer: False Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The T-account close is based on the process that people use when they make a decision. Some sales trainers refer to it as the Benjamin Franklin close but not the minorpoints close.Chapter 13 - Closing Begins the Relationship 13-8 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 25. A T-account close is based on the process that people use when they make a decision by weighing the pros against the cons. Answer: True Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The T-account close is based on the process that people use when they make a decision using pros and cons. 26. The salesperson who tells the prospect, "Since the cost of this line of plastic utensils will increase next week, can I place your order for the product today?" is using the standing-roomonly close. Answer: True Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The standing-room-only close motivates prospects to act immediately. The salesperson tells a prospect that failing to act now may lead to being unable to buy in the future. 27. When using the T-account close, some salespeople discuss the reasons not to buy first, followed by the reasons to buy. Answer: True Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Some salespeople recommend that the columns of the T-account be reversed so that the Not to Act column is on the left and the To Act column is on the right. This allows the salesperson to discuss the reasons not to buy first, followed by the reasons to buy, ending the presentation on the positive side. 28. A standing-room-only close is used to persuade an indecisive prospect to make a decision sooner rather than later. Answer: True Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Remember AACSB: AnalyticChapter 13 - Closing Begins the Relationship 13-9 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: The standing-room-only close motivates prospects to act immediately. The salesperson tells a prospect that failing to act now may lead to being unable to buy in the future. 29. In most cases, the technology close confuses and bores prospects. . Answer: False Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Understand AACSB: Technology Level of Difficulty: Medium Explanation: The technology close involves using a computer to show the prospect graphs and charts of past purchases and sales trends. The use of technology usually impresses buyers. 30. "I can defer the billing until the end of the month instead of a discount. Would you be happy with this arrangement?" This is an example of a negotiation close. Answer: True Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The purpose of a good sales negotiation close is not to haggle over who gets the larger slice of pie, but to find ways for everyone to have a fair deal. Both the buyer and the seller should win, as in this example. 31. The use of a multiple-close sequence increases the probability of losing a sale. Answer: False Learning Objective: 13-06 Topic: Prepare a Multiple-Close Sequence Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The use of a multiple-close sequence, combined with methods to overcome objections, enhances your chance of making a sale.Chapter 13 - Closing Begins the Relationship 13-10 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 32. A T-account close is suitable if the buyer has a predetermined belief that the competitor's product is needed. Answer: True Learning Objective: 13-05 Topic: Close Based on the Situation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: If a buyer has a predetermined belief that a competitor‟s product is needed, then the salesperson could use the T-account approach to show how a product‟s benefits are greater than a competitor‟s product. 33. Using too many closed-ended questions can result in an unsuccessful sales call. Answer: True Learning Objective: 13-05 Topic: Research Reinforces These Sales Success Strategies Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A salesperson who asks too many closed-end questions fails to give the prospect enough time to talk. As a result, the customer is alienated and the sales call fails. 34. Research shows that the summary of benefits close is the most powerful way to close a sales call. Answer: True Learning Objective: 13-05 Topic: Research Reinforces These Sales Success Strategies Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The most powerful way to close a sales call involves a summary of benefits that interest the customer. Three out of four calls that included this closing technique in Radick‟s study were successful.Chapter 13 - Closing Begins the Relationship 13-11 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 35. Before making a close, a salesperson should put away all visual aids since they will distract the prospect. Answer: False Learning Objective: 13-05 Topic: The Business Proposition and the Close Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The use of the visual aid works well in discussing the business proposition and when closing, so visual aids should not be put away. Multiple Choice Questions 36. A salesperson should attempt the close when the: A. prospect is at the „desire' stage of the mental buying process. B. prospect is ready. C. salesperson is ready. D. salesperson has handled an objection successfully. E. sales presentation is complete. Answer: B Learning Objective: 13-01 Topic: When Should I Pop the Question? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A close should be attempted when the prospect is ready, which is when the prospect is in the conviction stage of the mental buying process. A buyer can enter the conviction stage at any time during the sales presentation. 37. The prospect is likely to be in the _____ stage of the mental buying process when ready for a close. A. attention B. interest C. desire D. conviction E. action Answer: D Learning Objective: 13-01 Topic: When Should I Pop the Question? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A close should be attempted when the prospect is ready, which is when the prospect is in the conviction stage of the mental buying process. A buyer can enter the conviction stage at any time during the sales presentation.Chapter 13 - Closing Begins the Relationship 13-12 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 38. If your experience as a salesperson is typical, your close will most often take place: A. directly after the presentation. B. directly after the follow-up. C. soon before the preapproach. D. soon after the preapproach. E. soon after buying signals have been eliminated. Answer: A Learning Objective: 13-01 Topic: When Should I Pop the Question? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A salesperson might ask someone to buy as early as the approach stage or as late as another day, but most often the close comes after the presentation. The ability to read a prospect‟s buying signals correctly helps a salesperson decide when and how to close a sale. 39. While working with a customer at your weekend job in a furniture store, you notice the customer is closely examining a set of patio furniture. From your study of professional selling, you know that the customer is: A. prospecting. B. trying to be left alone. C. sending a buying signal. D. attempting to make a trial close. E. showing objections to the product. Answer: C Learning Objective: 13-01 Topic: Reading Buying Signals Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: By inspecting the furniture, the customer is giving nonverbal buying signals. Attempting a trial close would be the next step for the salesperson. 40. During a sales call, a prospect was in a state of visible anxiety during the early stages of the sales presentation. However, towards the end of the presentation, the prospect became friendly and appeared relaxed. This description indicates that: A. the buyer has hidden objections that need to be uncovered. B. a stronger relationship has to be established before close. C. the buyer wants to buy the product but at a later stage. D. the buyer expects a significant discount. E. the buyer is ready for a close. Answer: E Learning Objective: 13-01 Topic: Reading Buying SignalsChapter 13 - Closing Begins the Relationship 13-13 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Once the prospect decides to purchase a product, the pressure of the buying situation is eliminated. A state of visible anxiety changes to relaxation because your new customer believes that you are a friend. 41. After the pharmaceutical salesperson asks for the order, the very next thing he should do is to: A. describe the options from which the buyer may choose. B. place his order pad on the counter and open it to a new page. C. remain silent and wait for the prospect to respond. D. offer the prospect an extra inducement to buy now. E. confirm the size of his commission. Answer: C Learning Objective: 13-01 Topic: What Makes a Good Closer? Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: After requesting an order, a salesperson should remain quiet and allow the customer to think. The salesperson must put the prospect in a position of having to make a decision, speak first, and respond to the close. 42. Assume that a salesperson asks a prospect to buy, and surprisingly, the prospect agrees. What should the salesperson do now? A. Discuss additional benefits B. Be totally silent and remain still C. Leave the office as soon as possible D. Ask the customer for a future order E. Use a trial close to seek additional sales Answer: C Learning Objective: 13-01 Topic: What Makes a Good Closer? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: After receiving an order, the salesperson should leave the office. Continuing to talk or asking for more orders may irritate the customer and lead to losing the sale.Chapter 13 - Closing Begins the Relationship 13-14 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 43. As a general rule, you, as a salesperson, after receiving an order should leave the customer's office as soon as possible to avoid talking yourself out of the order. According to the text, it is not necessary for you to follow this rule if: A. you are explaining how to use the product correctly for health and safety reasons. B. you are asking the customer for the names of other potential prospects. C. you are describing the full benefits of the customer‟s purchase. D. the prospect buys before sooner than you expected. E. the product is technologically complex. Answer: B Learning Objective: 13-01 Topic: What Makes a Good Closer? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Talking too much can stop the sale after the prospect has said yes, so it is best for the salesperson to leave right away in most cases. An exception would be if the salesperson asks the customer for names of other prospects. Once this is done, it is best to take the order and move on. 44. To become a truly professional salesperson, you must be able to close under fire. The expression "close under fire" means to: A. shift the burden of obtaining proof to the prospect. B. ignore the prospect's objections and ask for the order anyway. C. sell to customers before they reach the conviction stage of buying. D. ask for the order even when the prospect is hostile or in a bad mood. E. ask the prospect to increase an order even when additional products are unnecessary. Answer: D Learning Objective: 13-02 Topic: Closing under Fire Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A professional salesperson must be able to close under fire. In other words, you must be able to ask a prospect who may be in a bad mood or even hostile toward you to buy. 45. Mark is the salesperson of a large FMCG company. You are calling on the purchase agent of a restaurant to inform him about a new promotional offer and to ask for an order of 100 cases. When Mark enters the customer's place, he realizes that the customer is in a bad mood. How should Mark most likely respond to this situation? A. Inform the agent about the promotion but do not request an order. B. Ask for a rescheduled appointment and call on the agent later. C. Attempt to close only once and leave if the prospect refuses. D. Calmly get out of the scene to avoid possible conflicts. E. Present the offer and ask for the order as usual. Answer: E Learning Objective: 13-02Chapter 13 - Closing Begins the Relationship 13-15 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Topic: Closing under Fire Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A professional salesperson must be able to ask a prospect who may be in a bad mood or even hostile toward you to buy. Multiple attempts to close are appropriate even when the prospect is in a bad mood. 46. Which of the following is most likely true about a trial close? A. A thwarted trial close means a sale will not occur. B. Use a trial close during but not after a presentation. C. Attempt a trial close after overcoming each objection. D. A trial close is unnecessary when strong buying signals are given. E. A trial close asks for a smaller quantity order compared to the real close. Answer: C Learning Objective: 13-04 Topic: Essentials of Closing Sales Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The salesperson should try a trial close after overcoming each objection that occurs during and after a presentation. Even with strong buying signals, a salesperson needs to make a trial close, and multiple trial closes are commonly required. 47. You are selling skiwear to the manager of a large ski resort. The manager has agreed to order ten down-filled jackets. After finalizing the sale, you should: A. spend some more time with the client to build a trusting relationship. B. explain the terms and conditions of the sale again. C. use a trial close to try to get additional sales. D. collect the order and leave. E. invite the client to lunch. Answer: D Learning Objective: 13-01 Topic: What Makes a Good Closer? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: After receiving an order, a salesperson should leave the office. Continuing to talk about the sale or asking for more orders may irritate the customer.Chapter 13 - Closing Begins the Relationship 13-16 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 48. Which of the following statements about the alternative-choice close is most likely true? A. The alternative-choice close does not give the customer the opportunity to have a preference. B. The alternative-choice close provides a choice between something and nothing. C. The alternative-choice close assumes that the customer does not have a desire to buy. D. The alternative-choice close assumes that the customer will only buy if tricked into believing a need exists for the product. E. The alternative-choice close does not give the prospect a choice of buying or not buying. Answer: E Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The alternative choice does not give prospects a choice of buying or not buying, but asks which one or how many items they want to buy. It says, “You are going to buy, so let‟s settle the details on what you will purchase.” Buying nothing at all is not an option. 49. A salesperson asks a prospect, "Would you prefer the freezer be on the top or bottom of the refrigerator?" This is an example of the _____ close. A. summary-of-benefits B. alternative-choice C. T-account D. assumptive E. standing-room-only Answer: B Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The alternative choice does not give prospects a choice of buying or not buying, but asks which one or how many items they want to buy. The salesperson thinks the prospect will buy the refrigerator and is trying to settle the details about the location of the freezer. 50. Which of the following is an example of alternative-choice closing technique? A. I‟ll send you three cases of wine tomorrow. B. Would you prefer orange flavor or lemon flavor? C. This product has many advantages, so why not buy it? D. Our offer will not last for long, so you have to act quickly. E. I would give you a discount if you bought both of these today. Answer: B Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: UnderstandChapter 13 - Closing Begins the Relationship 13-17 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Medium Explanation: The alternative choice does not give prospects a choice of buying or not buying, but asks which one or how many items they want to buy. The salesperson thinks the prospect will make a purchase and is trying to settle the details about the flavor. 51. "Which do you want—the flexible goggles or the rubber frame goggles?" This is an example of a(n) _____ close? A. Assumptive B. Standing-room-only C. Alternative-choice D. Technology E. Continuous-agreement Answer: C Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Understand AACSB: Prepare Several Closing Techniques Level of Difficulty: Medium Explanation: The alternative choice does not give prospects a choice of buying or not buying, but asks which one or how many items they want to buy. The salesperson thinks the prospect will buy goggles but the details of the goggles still need to be determined. 52. Even though the prospect had not yet agreed to buy, the salesperson said, "I'll make sure the carpeting is delivered to your house this Saturday." What type of close has the salesperson used? A. Assumptive B. Standing-room-only C. Alternative-choice D. Summary E. Continuous-agreement Answer: A Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: With the assumptive close, the salesperson assumes the prospect will buy. Statements can be made such as “I‟ll have this delivered to you tomorrow.” If the prospect does not say anything, assume the suggested order has been accepted.Chapter 13 - Closing Begins the Relationship 13-18 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 53. A salesperson calls one of his regular customers and says, "I'll call your order in this afternoon." This is an example of the _____ close. A. compliment B. alternative-choice C. minor-points D. assumptive E. standing-room-only Answer: D Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The salesperson assumes the prospect will buy when using an assumptive close. If the prospect does not disagree to an order being called in, then the close is successful. 54. The compliment close is most effective when the prospect is: A. a previous customer. B. a friend or relative. C. greedy. D. nervous. E. hostile. Answer: E Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The compliment close is especially effective with a prospect who is a self-styled expert or who is egotistical or hostile. A greedy customer who wants a deal is less likely to be persuaded with compliments.Chapter 13 - Closing Begins the Relationship 13-19 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 55. Chavez told his customer, "I realize your degree in chemistry makes you the expert on insecticides, but I suggest that you try my company's new line of organic insecticides. Other dealers have had great success with this line, and I know this product would make your store the best in the town." What type of a close was Chavez using? A. Standing-room-only B. Compliment C. Minor-points D. Assumptive E. Negotiation Answer: B Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Chavez is using the compliment close, which is especially effective when you talk with a prospect who is a self-styled expert. By complimenting the prospect, Warren hopes the prospect will listen and respond favorably to the presentation. 56. Miles sells greenhouse equipment. When meeting with Ray Dover, Miles said, "I talked to the owner of Tarpon Gardens today, and she said you have the best selection of roses of any grower in this area. I think my products can help you maintain healthy bushes with less work." What type of close did Miles use? A. Negotiation B. Assumptive C. Compliment D. Summary-of-benefits E. Minor-points Answer: C Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Miles is using a compliment to encourage Ray to listen to the sales presentation. If the compliment is sincere it may improve the chances of making a sale.Chapter 13 - Closing Begins the Relationship 13-20 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 57. After the prospect indicates that she likes the product, the salesperson asks, "You like the fit, the color, and how these glasses darken, right? I think you should buy a few of these." This is an example of the _____ close. A. summary-of-benefits B. alternative-choice C. minor-points D. assumptive E. assertive Answer: A Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The salesperson is using the summary-of-benefits close and highlighting the main features, advantages, and benefits of interest for the prospect. Summarize these benefits in a positive manner so that the prospect agrees with what you say; then ask for the order. 58. "You like the rotating handles, blade length, and weight of these pruning shears, right?" The salesperson is using the _____ close. A. compliment B. alternative-choice C. minor-points D. summary-of-benefits E. assumptive Answer: D Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The salesperson is using the summary-of-benefits close and highlighting the main features, advantages, and benefits of interest for the prospect. Benefits should be presented in a positive manner so that the prospect agrees and makes a purchase.Chapter 13 - Closing Begins the Relationship 13-21 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 59. A salesperson can easily adapt FAB statements and the SELL Sequence to make a(n) _____ close. A. alternative-choice B. assumptive C. summary-of-benefits D. minor-points E. direct Answer: C Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The summary-of-benefits close uses the features, advantages, and benefits (FAB) of the presentation to make the sale. The basic steps of the summary close are to determine the key product benefits that interest the prospect during the presentation, summarize these benefits, and make a proposal. 60. The _____ close requires the salesperson to ask the prospect a series of benefit questions. A. assumptive B. Ben Franklin C. negotiation D. continuous-yes E. minor-points Answer: D Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The continuous-yes close is like the summary close. However, instead of summarizing product benefits, the salesperson develops a series of benefit questions that the prospect must answer. 61. The questions in the continuous-yes close should be: A. open-ended to assess the prospect‟s needs. B. designed to generate negative responses. C. included in a brief product questionnaire. D. based on the weakness of the competition. E. based on benefits of the specific product. Answer: E Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Remember AACSB: AnalyticChapter 13 - Closing Begins the Relationship 13-22 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: The questions in a continuous-yes close are closed-end questions related to the product‟s benefits. The questions are intended to generate positive responses from the prospect. 62. Which of the following is most likely true regarding the summary-of-benefits close? A. It is infrequently used by salespeople. B. It aims at a specific prospect's personality. C. It cannot be used easily as it involves a complex process. D. The SELL sequence and FAB statements can be utilized. E. It is not a straightforward method to close an industrial sale. Answer: D Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The summary-of-benefits close is used by many people and involves a three-step process that integrates the SELL sequence and FAB statements of a sales presentation. 63. Even though Tristan and Adela had not placed their order, the salesperson asked the couple, "Would you prefer delivery of this dishwasher Thursday or Saturday?" This type of question is an example of a(n) _____ close. A. compliment B. assumptive C. minor-points D. alternative-choice E. modified T-account Answer: C Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 13 - Closing Begins the Relationship 13-23 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: The minor-points close is similar to the alternative-choice close, but the alternative-choice close asks the prospect to make a choice between two products, such as the Model X or Model Y dishwasher. The minor-points close asks the prospect to make a lowrisk decision on a minor, such as delivery date. 64. Which of the following statements is the best example of a minor-point close? A. "I'll have that new mattress delivered to your house on Wednesday." B. "Do you want those pillows in maroon or ebony?" C. "So you really like the fabric color and texture as well as the shape and size of that sofa?" D. "Your appreciation of that lamp just confirms my opinion of your impeccable tastes." E. "I am not sure if I have your shoe size. Would you want a pair if I have them in stock?" Answer: B Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The minor-points close asks the prospect to make a low-risk decision on a minor element, such as color or size. Since making big decisions can be difficult, the salesperson hopes that making minor decisions will lead to a sale. 65. "Would you prefer the 16-inch or the 20-inch hedge clippers?" This statement is an example of _____ close. A. T-account B. Forestalling C. Assumptive D. Minor-points E. Double-yes Answer: D Learning Objective: 13-05 Topic: Analytic Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The minor-points close asks the prospect to make a low-risk decision on a minor aspect, such as the size of the hedge clippers. By encouraging the prospect to make a simple decision, the salesperson hopes to prompt the customer to make a buying decision.Chapter 13 - Closing Begins the Relationship 13-24 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 66. Like the alternative-choice close, the _____ close asks the prospect to select between options. A. continuous-yes B. forestalling C. minor-points D. assumptive E. compliment Answer: C Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The minor-points close is similar to the alternative-choice close. Both methods involve giving the buyer a choice between two options. 67. What is the main similarity between the minor-points close and the alternate-choice close? A. Buyers are hostile. B. Risk factors are high. C. Buyers are typically decisive. D. Features and benefits are summarized. E. Buyers must decide between two options. Answer: E Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Both methods involve giving the buyer a choice between two options. The alternative-choice close asks the prospect to make a choice between two products, which represents a high-risk decision to some people. However, the minor-points close asks the prospect to make a low-risk decision on a minor element.Chapter 13 - Closing Begins the Relationship 13-25 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 68. When the salesperson helps her prospect make a two-column list with reasons in favor of buying on one side and reasons against buying on the other, she is using the _____ close. A. summary-of-benefits B. alternative-choice C. minor-points D. assumptive E. T-account Answer: E Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The salesperson is using the T-account close. This is the process a customer uses in making a buying decision, weighing the cons against the pros. 69. The car salesperson says to the prospect, "I have written down all the reasons why you should buy the new Ford Expedition. I think this might convince you that this is the car for your family." The car salesperson is using a(n) _____ close. A. summary-of-benefits B. continuous-yes C. minor-points D. T-account E. modified T-account Answer: E Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Some salespeople modify the T-account close by only listing reasons to act in one column. They do not want to remind the prospect of any negative reasons not to buy as they attempt to close the sale. This is similar to the continuous-yes close. The only difference is that the product benefits are written on a piece of paper. 70. When compared to the T-account close, the modified T-account close: A. uses debits and credits columns. B. is similar to the continuous-yes close. C. deals with the reasons for not buying. D. can only be created by the prospect. E. is similar to the summary-of-benefits close. Answer: B Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: RememberChapter 13 - Closing Begins the Relationship 13-26 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Easy Explanation: The T-account close lists both the pros and cons of buying, but the modified Taccount only lists reasons to buy. This is similar to the continuous-yes close. The only difference is that the product benefits are written on a piece of paper. 71. Amanda is a B2B salesperson. She believes that the modified balance sheet close is best suited to sell her products. Amanda would most likely avoid: A. openly listing the benefits of her products to prospects. B. reminding the prospect of negative product attributes. C. using technological aids for her presentations. D. group presentations involving multiple buyers. E. describing technical specifications of products. Answer: B Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The T-account close lists both the pros and cons of buying, but the modified Taccount only lists reasons to buy. Amanda would avoid reminding prospects of negative aspects of buying. 72. Which type of close is intended to motivate a prospect to act immediately? A. Compliment B. Summary-of-benefits C. Alternative-choice D. Standing-room-only E. Balance-Sheet Answer: D Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A salesperson can motivate indecisive prospects to act immediately by using the standing-room-only close. The salesperson suggests that if they don‟t act now they may not be able to buy in the future.Chapter 13 - Closing Begins the Relationship 13-27 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 73. When talking to a prospect, a salesperson says, "I'm not sure if we have any more of those tires to fit your car. Would you want them if we have some in stock?" The salesperson is using a(n) _____ close. A. probability B. assumptive C. minor-points D. standing-room-only E. balance-sheet Answer: D Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The salesperson uses the standing-room-only close to encourage the prospect to make a quick decision. The salesperson implies that if the prospect doesn‟t act now there may not be availability later. 74. Which of the following is the best example of the standing-room-only close? A. "I have made 5 packets for you and I will ship them soon?" B. "Will you want the merchandise delivered on Friday or Monday?" C. "We have only one more digital camera in stock, and we won't be receiving more until next month." D. "The color of that suit looks beautiful with your skin tone, and the way it is cut really shows off your figure." E. "These specific features make this computer monitor an absolute necessity for you." Answer: C Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A salesperson can motivate indecisive prospects to act immediately by using the standing-room-only close. The salesperson suggests that the camera is in low supply, so failing to buy one now will mean a significant delay.Chapter 13 - Closing Begins the Relationship 13-28 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 75. Cassandra works for a manufacturer of cedar closet systems. As she negotiates with a buyer for Home Depot, Cassandra says, "The recent drought in Maine may seriously limit our ability to meet your needs for cedar products in the future." Cassandra is using a(n) _____ close. A. probability B. standing-room-only C. minor-points D. assumptive E. balance-sheet Answer: B Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Cassandra is using the standing-room-only close to motivate the Home Depot buyer to buy the systems now. She suggests that if the buyer doesn‟t act now the closet systems may not be available in the future. 76. According to the text, which close is especially useful as a secondary or backup close? A. T-account B. Compliment C. Alternative-choice D. Assumptive E. Minor-points Answer: A Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: While the T-close can be used anytime, it is especially useful as a secondary or backup close. When a salesperson openly states an objection or reason not to buy, then the objection often becomes minor or disappears.Chapter 13 - Closing Begins the Relationship 13-29 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 77. The salesperson has just asked the prospect to order three cases of pet flea collars, and his prospect says, "I want to think it over." Which close is recommended for this situation? A. Probability B. Modified balance-sheet C. Minor-points D. Assumptive E. Balance-sheet Answer: A Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: When prospects say they want to think it over, it is probably because they don‟t fully understand what bothers them about closing a sale. The probability close permits prospects to focus on their real objections. Once the salesperson has a real objection, it can be converted into a persuasive sales argument. 78. The _____ close permits the prospect to focus on identifying their real objections to making a purchase. A. assumptive B. balance-sheet C. standing-room-only D. probability E. minor-points Answer: D Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The probability close permits your prospects to focus on their real objections. Once you have a real objection, convert that objection with a persuasive sales argument. 79. The salesperson says, "Would you be willing to accept a limited 2-year warranty that only covers parts and not labor?" This is likely to be a _____ close. A. negotiation B. continuous-yes C. summary-of-benefits D. T-account E. technology Answer: A Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: UnderstandChapter 13 - Closing Begins the Relationship 13-30 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Medium Explanation: The salesperson is using the negotiation close to reach a win-win solution. The salesperson would make a sale and the buyer would receive a fair warranty. 80. The purpose of the negotiation close is to: A. overcome a prospect's objections that you are unable to answer directly. B. make the prospect think haggling has led to the lowest price available. C. determine who gets the better end of the deal. D. get the prospect to reveal hidden objections. E. find ways for both parties to have a fair deal. Answer: E Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The purpose of a good sales negotiation close is not to haggle over who gets the larger slice of pie, but to find ways for everyone to have a fair deal. Both the buyer and the seller should win. 81. The salesperson was selling the couple a garden tub for their new bathroom. He said, "The water jets, large capacity, and marble finish are wonderful features, wouldn‟t you agree?” When this first close failed, he asked, "Will you want to use clear or white caulk to install your new tub?" The couple did not answer this question. The salesperson then began making a two-column list with reasons for and against buying. The salesperson used a: A. presumptive close. B. dyadic close based on the SELL Sequence. C. multiple distribution technique. D. multiple-close sequence. E. probability close. Answer: D Learning Objective: 13-06 Topic: Prepare a Multiple-Close Sequence Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The salesperson used a multiple-close sequence. He started with a summary-ofbenefits closed and then tried a minor-points close. When those both failed, he tried the Taccount method.Chapter 13 - Closing Begins the Relationship 13-31 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 82. According to the text, which closing technique is effective in all situations? A. Assumptive B. Probability C. Continuous-yes D. Minor-points E. Standing-room-only Answer: B Learning Objective: 13-05 Topic: Close Based on the Situation Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The probability and negotiation close techniques apply to all situations according to the text. Assumptive is best with friends, and continuous-yes is best with indecisive or hostile prospects. 83. During a sales call, you realize that the customer is greedy. Which of the following closing techniques is best suited to handle this customer? A. Standing-room-only B. Assumptive C. Minor points D. Alternative close E. Summary Answer: A Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A greedy customer who really wants a good deal is most likely to respond to a standing-room-only close. Such people would probably not make a buying decision due to an assumptive, minor-points, or summary close. 84. Which of the following closing techniques is LEAST preferred when calling on an indecisive customer? A. Summary-of-benefits B. Probability C. Negotiation D. Assumptive E. Standing-room-only Answer: D Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: UnderstandChapter 13 - Closing Begins the Relationship 13-32 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Medium Explanation: A salesperson facing an indecisive prospect would be most successful using the summary-of-benefits, probability, negotiation, or standing-room-only close. However, an indecisive prospect is less likely to respond to an assumptive close. 85. James is calling on an important prospect. He realizes that the customer has predetermined beliefs about the services of his company. Which closing method would me most appropriate? A. T-account B. Minor-points C. Continuous-yes D. Compliment E. Alternative-choice Answer: A Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The T-account method would be best when a customer has predetermined beliefs. Such prospects would be less responsive to the minor-points, continuous-yes, compliment, or alternative-choice methods. 86. There are six common mistakes that prevent a salesperson from making a successful sales call. Which of the following is NOT one of those mistakes? A. Asking too many questions; making the prospect do too much talking. B. Over controlling the call; asking too many closed-end questions. C. Not responding to customer needs with benefits. D. Not recognizing needs; giving benefits prematurely. E. Making weak closing statements; not recognizing when or how to close. Answer: A Learning Objective: 13-01 Topic: Research Reinforces These Sales Success Strategies Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Salespeople tend to not ask enough questions or ask too many closed-end questions which prevents them from fully understanding a prospect‟s needs. Weak closing statements are also a common problem.Chapter 13 - Closing Begins the Relationship 13-33 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 87. Which of the following is a common mistake that prevents a salesperson from making a successful sales call? A. Expecting the prospect to take an active role in the presentation B. Making overly assertive closing statements C. Not recognizing when or how to close D. Asking too many open-ended questions E. Being too accommodating to the prospect Answer: C Learning Objective: 13-01 Topic: Research Reinforces These Sales Success Strategies Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Research shows that salespeople fail to know when and how to close the sale. They have a tendency to make weak closing statements as well. 88. As a salesperson, you need to know that the business proposition: A. should never be used during the sales presentation. B. is a weak selling tool that should be added in an appendix. C. should be used only if the prospect has multiple objections. D. should follow the discussion of the product's FABs and marketing plan. E. typically does not help you close the sale. Answer: D Learning Objective: 13-05 Topic: The Business Proposition and the Close Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The product‟s FAB s and marketing plan justify your suggested order and are presented first in the sales presentation. The business proposition is the third step within the presentation and very important to closing the sale. 89. To become a successful professional salesperson, you should do all of the following EXCEPT: A. asking questions to gather information. B. recognizing how the benefits of the product satisfy the customer's needs. C. establishing a balanced dialogue with customers. D. using a benefit summary and action plan requiring commitment when closing. E. trying to maximize profits and benefits only for your company. Answer: E Learning Objective: 13-01 Topic: Keys to Improved Selling Blooms: Understand AACSB: AnalyticChapter 13 - Closing Begins the Relationship 13-34 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: Asking questions, matching benefits to needs, and establishing dialogue with customers are skills of successful salespeople. Ethical salespeople try to help their customers rather than help themselves. 90. When the salesperson has done the best he can and still is unable to close the sale, he should: A. remove that prospect from the sales call list. B. categorize that prospect as an orphan. C. try to re-qualify the prospect. D. thank the customer for the opportunity. E. stop calling the customer. Answer: D Learning Objective: 13-02 Topic: When You Do Not Make the Sale Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The salesperson should thank the prospect for the time and opportunity. It‟s important to leave the door open for future sales. Essay Questions 91. What should the Golden Rule salesperson do when it is obvious that a product is not what the buyer really needs? Answer: Unlike the traditional salesperson, who will sell it to the buyer even if he/she does not need it, a Golden Rule salesperson should place the buyer's interest first and may suggest to the buyer that the product may not suit his/her needs. The Golden Rule salesperson should refrain from engaging in unethical sales practice. This is extremely important in building a long-term business relationship. Learning Objective: 13-01 Topic: The Golden Rule: Closing Blooms: Understand AACSB: Ethics Level of Difficulty: Medium 92. What is a buying signal? Give two examples. Answer: A buying signal refers to anything that prospects say or do to indicate they are ready to buy. Students' examples will vary. Some examples include (1) asking questions, (2) asking another person's opinion, (3) relaxing and becoming friendly with the salesperson, (4) pulling out a purchase order form, and (5) carefully examining the merchandise. Learning Objective: 13-01 Topic: Reading Buying Signals Blooms: UnderstandChapter 13 - Closing Begins the Relationship 13-35 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Communication Level of Difficulty: Medium 93. How can today‟s salespeople integrate technology into the close? Answer: A salesperson could use Power Point or other software to facilitate closing a sale. A laptop or tablet would enable the salesperson to easily show a prospect graphs and bar charts with past purchases and sales trends as well as purchase suggestions and possible payment schedules. A technology close is very impressive to buyers. The exact use of technology in closing a sale depends on the product and customer. Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Apply AACSB: Technology Level of Difficulty: Hard 94. According to the text, what are the basic reasons that salespeople face difficulties in closing sales? Answer: There are three basic reasons why salespeople find it difficult to close the sale: (1) Sometimes salespeople are not confident in their ability to close; this lack of confidence may be the result of a previous failure to make a sale. (2) Salespeople often determine that the prospect does not need the quantity or type of merchandise, so they do not ask for the order. (3) The salesperson may not have worked hard enough in developing a customer profile and customer benefit plan—resulting in a poor presentation. Learning Objective: 13-01 Topic: Difficulties with Closing Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 95. Give an example of how a Girl Scout can use an alternative-choice close to sell Girl Scout cookies. Answer: Students' answers will vary depending on their creativity. Possible answers include: "Do you prefer the Thin Mints or the Shortbread cookies?" or "Do you want 3 or 4 boxes of Thin Mints?" In whatever example provided, the answer should indicate that the prospect does not have a choice of buying or not buying. Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Apply AACSB: Analytic Level of Difficulty: HardChapter 13 - Closing Begins the Relationship 13-36 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 96. When would a salesperson find the compliment close to be the most appropriate close? Answer: The compliment close is especially effective when you talk with a prospect who is a self-styled expert, who has a big ego, or who is in a bad mood. This type of close is also effective on prospects with low self-esteem or those who find it difficult to arrive at a decision. Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 97. What is an assumptive close? When can it be used? Answer: With the assumptive close, the salesperson assumes that the prospect will buy and makes a statement regarding the purchase. The salesperson may say, "I will ship the order by tomorrow." This can be used when the salesperson has earned the trust of the buyer to an extent of ordering for him. It can be used if the buyer is friend or if the salesperson has called on the prospect for a long time. Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Apply AACSB: Analytic Level of Difficulty: Hard 98. Briefly describe the purpose and steps of the exit technique. Answer: The exit technique is used when a sale is not made. The salesperson should use the exit technique by saying, “Mr. Smith, would you do one thing for your company? Would you please think about what we discussed? Please look over this material and the price sheet. I know (product name) is needed by your organization. Please call me if you have any questions. Would it be all right, Mr. Smith, if I come by in a month or so to see what you think about (product name)?” Thank the prospect for the opportunity, shake hands, and leave in a positive and friendly manner. Learning Objective: 13-02 Topic: When You Do Not Make the Sale Blooms: Apply AACSB: Analytic Level of Difficulty: Hard 99. How does the modified T-account close differ from the T-account close? Answer: In the T-account close, the sales person lists out the reasons for buying as-well-as not buying. In the modified T-account close, the salesperson does not list any reasons for not buying. Learning Objective: 13-05 Topic: Prepare Several Closing Techniques Blooms: Understand AACSB: AnalyticChapter 13 - Closing Begins the Relationship 13-37 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium 100. Why is it recommended that a salesperson remain quiet after asking for an order? Answer: It is important to be silent after asking for an order. By asking for an order you have put the prospect in a position to make a decision and speak first. By saying anything after the close, the prospect will not be under pressure to make a decision. This may also allow the prospect enough time to take a negative decision. Learning Objective: 13-04 Topic: What Makes a Good Closer? Blooms: Understand AACSB: Communication Level of Difficulty: MediumChapter 14 - Service and Follow-Up for Customer Retention 14-1 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Chapter 14 Service and Follow-Up for Customer Retention Learning Objectives: 14-01 State why service and follow-up are important to increasing sales. 14-02 Build friendships. 14-03 Discuss how follow-up and service result in account penetration and improved sales. 14-04 List the eight steps involved in increasing sales to your customer. 14-05 Explain the importance of properly handling customers’ returned goods requests and complaints in a professional manner. True / False Questions 1. According to the author, many people are unsuccessful in sales because they do not have the ability to put their own needs before anyone else's interests. Answer: False Learning Objective: 14-01 Topic: The Golden Rule: Service Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: The fact is many people do not make it in sales because they do not have the ability to put someone’s interests before their own needs for money, power, and influence. All they want to do is make the sale and move on to the next conquest. 2. The Golden Rule of Selling supports the belief that service and follow-up after the sale show that the salesperson really cares about customers. Answer: True Learning Objective: 14-01 Topic: The Golden Rule: Service Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: A Golden Rule salesperson puts customers first. Providing service and follow-up after the sale is a sign of caring and integrity. 3. According to the text, wisdom and knowledge are synonyms. Answer: False Learning Objective: 14-01 Topic: The Importance of Service and Follow-Up Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: There is a difference between knowledge (having these facts) and wisdom (applying these facts to taking care of customers). We may amass knowledge, but without wisdom, our knowledge is useless.Chapter 14 - Service and Follow-Up for Customer Retention 14-2 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 4. Closing ends the relationship between a salesperson and a customer. Answer: False Learning Objective: 14-01 Topic: The Golden Rule: Service Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Closing begins the relationship with your customer. Service and follow-up after the sale show you truly care. 5. Follow-up refers to maintaining contact with a customer in order to evaluate the effectiveness of the product and the satisfaction of the customer. Answer: True Learning Objective: 14-01 Topic: The Importance of Service and Follow-Up Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Follow up involves maintaining contact with a customer (or prospect) in order to evaluate the effectiveness of the product. The customer’s satisfaction determines whether or not the product is effective. 6. Caring for people is the beginning of sales wisdom. Answer: True Learning Objective: 14-01 Topic: The Importance of Service and Follow-Up Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Caring for people is the beginning of sales wisdom. The purpose of this book is to teach people how to attain wisdom in order to do what is right and just and fair.Chapter 14 - Service and Follow-Up for Customer Retention 14-3 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 7. After a sale has been made, there is no need for the salesperson to maintain relations with the customer. Answer: False Learning Objective: 14-01 Topic: The Importance of Service and Follow-Up Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Follow up involves maintaining contact with a customer (or prospect) in order to evaluate the effectiveness of the product. By remaining in contact with a customer, a salesperson shows caring and begins forming a long-term relationship. 8. A salesperson gains wisdom by trusting others and learning from mistakes. Answer: True Learning Objective: 14-01 Topic: The Importance of Service and Follow-Up Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: In sales, one gains wisdom through a constant process of growing. First, we must trust and honor people. Then, we must learn from our errors and recover. 9. A business friendship differs significantly from a personal friendship. Answer: False Learning Objective: 14-02 Topic: Building a Long-Term Business Friendship Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The relationship between a salesperson and a client that revolves around business related issues is referred to as a business friendship. A good business friendship is a relationship much like any of your personal friendships. 10. A buyer and seller who are at the first stage of business friendship are called acquaintances. Answer: True Learning Objective: 14-02 Topic: Building a Long-Term Business Friendship Blooms: Remember AACSB: Analytic Level of Difficulty: EasyChapter 14 - Service and Follow-Up for Customer Retention 14-4 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Acquaintances are people whose names you know, whom you see occasionally, and whom you may know little about even if you’ve known them for a long time. In the business world, as well as in one’s personal life, acquaintances are viewed as having low levels of wisdom and trust. 11. Acquaintances experience low levels of wisdom and trust. Answer: True Learning Objective: 14-02 Topic: Building a Long-Term Business Friendship Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Trust and wisdom both increase with time in any relationship. Acquaintances have the lowest levels of trust and wisdom and intimate friends the greatest. 12. The third level of relationships, intimate friends, applies to personal relationships but not business relationships. Answer: False Learning Objective: 14-02 Topic: Building a Long-Term Business Friendship Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: There are three levels of relationships with both business and personal friends: acquaintances, friends, and intimate friends. 13. The steps involved in developing a friendship are self-appraisal, acknowledgement, attending, and talking. Answer: False Learning Objective: 14-02 Topic: Building a Long-Term Business Friendship Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The steps involved in developing a friendship are self-disclosure, acknowledgement, attending, and talking. 14. In a relationship, trust increases and wisdom decreases over time. Answer: False Learning Objective: 14-02 Topic: Building a Long-Term Business Friendship Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 14 - Service and Follow-Up for Customer Retention 14-5 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Trust and wisdom both increase with time in any relationship. Acquaintances have the lowest levels of trust and wisdom and intimate friends the greatest. 15. According to the text, one of the easiest things a salesperson can do is to care about customers. Answer: False Learning Objective: 14-01 Topic: The Importance of Service and Follow-Up Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Caring for a customer is difficult and inconvenient; however, caring builds longterm relationships with customers. 16. According to the text, the most important ingredient in building a lasting friendship is perseverance. Answer: False Learning Objective: 14-02 Topic: Building a Long-Term Business Friendship Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The most important ingredients in building a lasting friendship are truly caring for the other person and placing their interests before your interests. Friendship is based on their needs, not on your needs and not necessarily on perseverance. 17. After Helen, a realtor, closes a sale on a house, she usually calls her customers the following week to find out if they are pleased with their new home. This is an example of transaction selling. Answer: False Learning Objective: 14-01 Topic: Relationship Marketing and Customer Retention Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Transaction selling occurs when the salesperson sells to customers and does not contact them again. Helen is involved in relationship selling because after the purchase she contacts customers to find out if they are satisfied with the home. 18. The three levels of customer relationship selling are transformation selling, relationship selling, and partnering. Answer: False Learning Objective: 14-01 Topic: Relationship Marketing and Customer Retention Blooms: RememberChapter 14 - Service and Follow-Up for Customer Retention 14-6 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Easy Explanation: Transaction selling, relationship selling, and partnering are the three levels of customer relationship marketing. 19. Partnering refers to working continually to improve the customer's operations, sales, and profits. Answer: True Learning Objective: 14-01 Topic: Relationship Marketing and Customer Retention Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Partnering occurs when the seller works continually to improve the customer’s operations, sales, and profits. 20. Relationship marketing involves using promotions and service to create customer loyalty. Answer: True Learning Objective: 14-01 Topic: Relationship Marketing and Customer Retention Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Relationship marketing is the creation of customer loyalty and retention. Organizations use combinations of products, prices, distribution, promotions, and service to achieve this goal. Relationship marketing is based on the idea that important customers need continuous attention. 21. An organization using relationship marketing to facilitate quick, one-time sales. Answer: False Learning Objective: 14-01 Topic: Relationship Marketing and Customer Retention Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Relationship marketing involves creating customer loyalty rather than generating one-time sales. Organizations use combinations of products, prices, distribution, promotions, and service to achieve this goal. Relationship marketing is based on the idea that important customers need continuous attention. 22. If a salesperson sells to customers and does not contact them again, it is known as relationship selling. Answer: False Learning Objective: 14-01 Topic: Relationship Marketing and Customer RetentionChapter 14 - Service and Follow-Up for Customer Retention 14-7 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Transaction selling occurs when the salesperson sells to customers and does not contact them again. Relationship selling involves contacting customers after a purchase to find out if the customer is satisfied and has future needs. 23. Customer service refers to the activities and programs the seller provides to make the relationship satisfying for the customer. Answer: True Learning Objective: 14-01 Topic: The Product and Its Service Component Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Customer service refers to the activities and programs the seller provides to make the relationship satisfying for the customer. The activities and programs add value to the customer’s relationship with the seller. 24. Service quality is not determined by customer expectations but on organizational metrics. Answer: False Learning Objective: 14-01 Topic: The Product and Its Service Component Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The quality of service an organization and its salespeople provide must be based on its customers’ expectations. Customer expectations frequently are based on information the salesperson provides, past experiences, word of mouth, and personal needs. 25. Satisfied customers help salespeople make new sales. Answer: True Learning Objective: 14-01 Topic: Customer Satisfaction and Retention Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Satisfaction can result in a customer so loyal that it is very difficult for another seller to get the business. Thus, customer retention and customer satisfaction are critical to a salesperson’s long run success.Chapter 14 - Service and Follow-Up for Customer Retention 14-8 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 26. An effective salesperson converts follow-up and service situations into sales. Answer: True Learning Objective: 14-03 Topic: Turn Follow-Up and Service into a Sale Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: High-performing salespeople can convert follow-up and service situations into sales. Follow-up and service help satisfy the needs of his customers which makes them more likely to buy. 27. The ability to work and contact people throughout the account, discussing your products, is known as account penetration. Answer: True Learning Objective: 14-03 Topic: Account Penetration Is a Secret to Success Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The ability to work and contact people throughout the account, discussing your products, is referred to as account penetration. Successful penetration of an account allows you to properly service that account by uncovering its needs and problems. 28. The more a salesperson penetrates an account the greater the chances of maximizing sales within the account. Answer: True Learning Objective: 14-03 Topic: Account Penetration Is a Secret to Success Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: As a general rule, the greater your account penetration, the greater your chances of maximizing sales within the account. Earning the privilege to move around the account freely allows you to better uncover prospect needs and to discuss your products with people throughout the firm. 29. According to the text, nothing destroys a relationship with a customer faster than not following through on promises. Answer: True Learning Objective: 14-03 Topic: Service Can Keep Your Customers Blooms: Remember AACSB: Analytic Level of Difficulty: EasyChapter 14 - Service and Follow-Up for Customer Retention 14-9 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Nothing destroys a relationship with a customer faster than not following through on promises. Professional buyers do not tolerate promises made and subsequently broken. 30. The most productive number of calls to make on an account is reached when additional calls do not lead to additional sales. Answer: True Learning Objective: 14-03 Topic: Service Can Keep Your Customers Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The most productive number of calls is reached at the point at which additional calls do not increase sales to the customer. This relationship of sales volume to sales calls is referred to as the response function of the customer to the salesperson’s calls. 31. By sending greeting cards, the salesperson shows his appreciation for the customer's business. Answer: True Learning Objective: 14-03 Topic: Service Can Keep Your Customers Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Sending holiday or birthday cards to customers expresses appreciation. Customers contribute to a salesperson’s success, so appreciation should be given in return. 32. If a salesperson learns that a customer has been lost to a competitor, it is best to visit the customer and assert that a serious mistake has been made. Answer: False Learning Objective: 14-05 Topic: You Lose a Customer—Keep on Trucking Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: If you have lost the customer to a competitor completely, let the customer know you have appreciated past business, that you still value the customer’s friendship, and that you are still friendly. Remember to assure this lost account that you are ready to earn future business.Chapter 14 - Service and Follow-Up for Customer Retention 14-10 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 33. If merchandise that has been sold in the past is unusable, the salesperson should not return the merchandise at it would result in loss. Answer: False Learning Objective: 14-05 Topic: Returned Goods Make You a Hero Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: One of the best ways to help customers is through careful examination of merchandise you have sold in the past to see if it is old, out-of-date, or unsalable due to damage. If any of these conditions exist, the salesperson should cheerfully return the merchandise following the company’s returned goods policies. 34. To be viewed as professionals and respected by customers, salespeople should join worthwhile organizations such as the Lions Club or the Chamber of Commerce. Answer: True Learning Objective: 14-01 Topic: Build a Professional Reputation Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: To be considered professionals, salespeople are often active in community affairs. Salespeople become active in public schools and join worthwhile organizations such as the Lions Club, the Chamber of Commerce, environmental organizations, and so forth. 35. A salesperson should entertain both prospects and current customers regularly to ensure customer satisfaction. Answer: False Learning Objective: 14-01 Topic: Do’s and Don’ts for Business Salespeople Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A salesperson should entertain selectively. A salesperson’s time and expense account are investments that cannot be spent on all prospects and customers.Chapter 14 - Service and Follow-Up for Customer Retention 14-11 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Multiple Choice Questions 36. The most important activity for ensuring repeat sales is: A. understanding the prospect's product line. B. prospecting on a regular basis. C. getting multiple referrals. D. expanding the sales territory. E. providing follow-up and service. Answer: E Learning Objective: 14-01 Topic: The Importance of Service and Follow-Up Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Follow-up and service to customers is the salesperson’s most important activity for future sales. Getting referrals and understanding the prospects needs are important but providing service is essential 37. According to the text, many people do not make it in sales because they are unable to: A. identify a customer's needs very quickly. B. place someone's interests before their own. C. predict the long-term sales outcome. D. ensure future sales from a customer. E. obtain loyal customers. Answer: B Learning Objective: 14-01 Topic: The Golden Rule: Service Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: Many people do not make it in sales because they do not have the ability to put someone’s interests before their own needs for money, power, and influence. All they want to do is make the sale and move on to the next conquest. 38. Which term refers to maintaining contact with a customer in order to evaluate the effectiveness of the product and the satisfaction of the customer? A. Internalization B. Resale C. Follow-up D. Sales penetration E. Transaction selling Answer: C Learning Objective: 14-01 Topic: The Importance of Service and Follow-Up Blooms: RememberChapter 14 - Service and Follow-Up for Customer Retention 14-12 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Easy Explanation: Follow up involves maintaining contact with a customer (or prospect) in order to evaluate the effectiveness of the product. Follow-up involves handling complaints and conducting surveys but not asking for a buying decision. 39. Sales wisdom comes from: A. the realization that the purpose of sales is to help people. B. an understanding of the importance of account penetration. C. the belief that the customer is always right. D. the development of business networks. E. increased contact with one's customers. Answer: A Learning Objective: 14-01 Topic: The Importance of Service and Follow-Up Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: In sales, one gains wisdom through a constant process of growing. First, we must trust and honor people. Second, we must realize that our purpose is to help people. 40. Which of the following statements about wisdom and knowledge is true? A. Wisdom means having all the facts needed to make sales. B. Knowledge is only acquired through experiential learning. C. Knowledge refers to the possession of facts. D. Knowledge refers to the usage of facts. E. Wisdom and knowledge are the same. Answer: C Learning Objective: 14-01 Topic: The Importance of Service and Follow-Up Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: There is a vast difference between knowledge (having facts) and wisdom (applying facts to taking care of customers). We may amass knowledge, but without wisdom, our knowledge is useless.Chapter 14 - Service and Follow-Up for Customer Retention 14-13 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 41. According to the text, the development of a strong relationship between the salesperson and the prospect begins: A. with the follow-up. B. when the salesperson analyzes the customer's needs. C. when the first order is placed. D. when all objections have been handled. E. when the customer is presented with product benefits. Answer: B Learning Objective: 14-01 Topic: The Importance of Service and Follow-Up Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A relationship between buyer and seller first begins when the salesperson analyzes the needs of the customer. Follow-up, order placement, and the sales presentation occur later in the selling process. 42. If a salesperson sincerely wants to establish a caring relationship with a potential key account, the salesperson should: A. view the selling process as continuous. B. engage in transaction selling activities. C. assume the selling process has an end. D. internalize the buyer's organizational culture. E. engage in relationship transformation selling. Answer: A Learning Objective: 14-01 Blooms: Understand Topic: The Importance of Service and Follow-Up AACSB: Analytic Level of Difficulty: Medium Explanation: Analyzing needs, presenting product benefits, gaining commitment, and providing service are the four stages of a caring relationship in sales. The process is a continuous cycle when implemented effectively.Chapter 14 - Service and Follow-Up for Customer Retention 14-14 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 43. Which of the following terms best describes the relationship between a salesperson and a client that revolves around business-related issues? A. Marketing relationship B. Transactional relationship C. Business friendship D. Reciprocal relationship E. Partnering opportunity Answer: C Learning Objective: 14-02 Topic: Building a Long-Term Business Friendship Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The relationship between a salesperson and a client that revolves around business related issues is referred to as a business friendship. A good business friendship is a relationship much like any of your personal friendships. 44. The first level of relationship in a business friendship is that of: A. intimate friends. B. friends. C. companions. D. acquaintances. E. adversaries. Answer: D Learning Objective: 14-02 Topic: Building a Long-Term Business Friendship Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Usually we have one of three levels of relationships with both business and personal friends: acquaintances, friends, and intimate friends. Acquaintances are the first level of any relationship. 45. The third level of relationship in a business friendship is: A. intimate friends. B. strategic alliances. C. joint ventures. D. reciprocal alliances. E. companionship. Answer: A Learning Objective: 14-02 Topic: Building a Long-Term Business Friendship Blooms: Remember AACSB: Analytic Level of Difficulty: EasyChapter 14 - Service and Follow-Up for Customer Retention 14-15 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: The third level of a business friendship is intimate friends. In the customer– seller relationship, personal interests of each other and their families have top priority. 46. Stephen, a senior salesperson of a software firm, is calling on an acquaintance, the CEO of a manufacturing firm. During the sales call, Stephen should most likely avoid: A. mentioning his family life. B. summarizing the CEOs comments. C. making eye contact with the CEO. D. invalidating the CEO’s opinions. E. exhibiting knowledge of his product. Answer: D Learning Objective: 14-02 Topic: Building a Long-Term Business Friendship Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: Developing a friendship involves sharing some personal information, acknowledging the buyer’s ideas, and making eye contact. Showing product knowledge is effective for any salesperson, but invalidating a client’s ideas is likely to be taken poorly. 47. Attending to a customer involves: A. repeating what he/she says. B. invalidating what he/she says. C. changing the client's mind on an issue. D. engaging in high pressure selling. E. paying attention to him/her. Answer: E Learning Objective: 14-02 Topic: Building a Long-Term Business Friendship Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Attending involves paying attention to your client. Your eyes, ears, body, and thought should all be focused on them and what they are saying. Make eye contact to show your client that you are really listening to what he or she has to say.Chapter 14 - Service and Follow-Up for Customer Retention 14-16 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 48. A good relationship with the client can be maintained if the: A. client takes full control. B. client outdoes the salesperson. C. salesperson outdoes the client. D. salesperson changes the client's mind on issues. E. roles and expectations of each person are defined. Answer: E Learning Objective: 14-02 Topic: Building a Long-Term Business Friendship Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A good relationship needs structure to survive. Define your and your business friend’s responsibilities, expectations, and roles at the outset and follow them accordingly. One-upmanship and controlling tendencies have a negative effect on relationships. 49. If a salesperson sells to customers and does not contact them again, the salesperson is involved in: A. transaction selling. B. transformational selling. C. relationship selling. D. partnering. E. solution selling. Answer: A Learning Objective: 14-01 Topic: Relationship Marketing and Customer Retention Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Transaction selling is the lowest and most basic level that involves a salesperson selling to customers and never contacting them again. 50. Sam Utley drives to a local convenience store to purchase milk. The store that sells milk to Utley most likely engages in_____ selling. A. benefit B. relationship C. partnership D. transformational E. transaction Answer: E Learning Objective: 14-02 Topic: Relationship Marketing and Customer Retention Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 14 - Service and Follow-Up for Customer Retention 14-17 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Transaction selling is the lowest and most basic level that involves a salesperson to sell to customers and never contact them again. A convenience store would probably not contact Utley to determine his satisfaction with the milk he purchased. 51. What is the most basic level of customer relationship marketing? A. Transaction selling B. Relationship selling C. Account selling D. Networking E. Partnering Answer: A Learning Objective: 14-02 Topic: Relationship Marketing and Customer Retention Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Customer relationship marketing consists of three levels: transaction selling, relationship selling, and partnering. Transaction selling is the lowest and most basic level that involves a salesperson selling to customers and never contacting them again. 52. Bo Hardigan is a salesperson at Caesar's Boating Extravaganza. He uses his free time in the store to telephone people who have purchased equipment from him recently to determine if they are satisfied and have future needs. This is an example of _____ selling. A. benefit B. relationship C. partnership D. transformational E. transaction Answer: B Learning Objective: 14-01 Topic: Relationship Marketing and Customer Retention Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Bo is engaged in relationship selling because he is reaching out to customers to determine their satisfaction with purchases. Transaction selling is the lowest and most basic level that involves a salesperson selling to customers and never contacting them again.Chapter 14 - Service and Follow-Up for Customer Retention 14-18 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 53. When a seller works continually to improve customers' operations, sales, and profits it is known as ____. A. benefit selling B. alliance selling C. partnering D. relationship selling E. transaction selling Answer: C Learning Objective: 14-01 Topic: Relationship Marketing and Customer Retention Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A salesperson engaged in partnering with a customer is working constantly to improve the customer’s operations, sales, and profits. Transaction selling involves no postsale follow-up from the salesperson. 54. _____ marketing is based on the idea that important customers require constant attention. A. Transaction B. Relationship C. Quality D. Transformational E. Partnership Answer: B Learning Objective: 14-02 Topic: Relationship Marketing and Customer Retention Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Relationship marketing is the creation of customer loyalty and retention and based on the idea that important customers need attention. Organizations use combinations of products, prices, distribution, promotions, and service to retain customers. 55. _____ refers to the activities and programs provided by the seller to make the relationship satisfying for the customer. A. Customer service B. Skimming C. Transaction selling D. Customized marketing E. Direct marketing Answer: A Learning Objective: 14-03 Topic: The Product and Its Service Component Blooms: Remember AACSB: AnalyticChapter 14 - Service and Follow-Up for Customer Retention 14-19 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: Customer service refers to the activities and programs the seller provides to make the relationship satisfying for the customer. The activities and programs add value to the customer’s relationship with the seller. 56. Customer satisfaction refers to: A. the total shopping experience. B. a feeling towards the purchase. C. an expectation about the product. D. activities intended to retain buyers. E. marketing experiences prior to purchase. Answer: B Learning Objective: 14-03 Topic: Customer Satisfaction and Retention Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Customer satisfaction refers to feelings toward the purchase. Perceived purchase satisfaction reflects the customer’s feelings about any differences between what is expected and actual experiences with the purchase. 57. Perceived purchase satisfaction is: A. the salesperson's product perception. B. a positive feeling towards the product. C. based on actual product performance and customer service. D. the difference between product expectation and actual experience. E. the expected satisfaction level of a product at a particular design stage. Answer: D Learning Objective: 14-03 Topic: Customer Satisfaction and Retention Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Perceived purchase satisfaction reflects the customer’s feelings about any differences between what is expected and actual experiences with the purchase.Chapter 14 - Service and Follow-Up for Customer Retention 14-20 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 58. Rick Lee, a milk deliveryman in New York, delivers dairy products to 200 customers weekly. The quality of the service Rick provides to his customers is based on customer expectations. All of the following determine the expectations of Rick’s customers EXCEPT: A. customer needs for fresh milk delivered weekly. B. customer experiences with milk from a grocery store. C. Rick’s ability to provide the anticipated dairy products. D. word-of-mouth comments about Rick’s product and service. E. changing shifts in demand for local produce and dairy products. Answer: E Learning Objective: 14-03 Topic: The Product and its Service Component Blooms: Analyze AACSB: Analytic Level of Difficulty: Hard Explanation: The quality of service an organization and its salespeople provide must be based on its customers’ expectations. The expectations of Rick’s customers are mostly based on information the salesperson provides, past experiences, word of mouth, and personal needs. Shifting demand is less relevant to customer expectations. 59. Peter is a salesman of Turner Associates, a machine tool manufacturer. During his routine visit to a customer's house, Peter finds out that the customer has a fresh requirement for two lathe machines. According to the text, Peter should move back to the _____ stage in relationship selling for the new machines. A. approach B. presentation C. trial close D. close E. preapproach Answer: E Learning Objective: 14-04 Topic: So, How Does Service Increase Your Sales? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Since Peter needs to sell a new product for which he had not planned, he should go back to the preapproach and planning stage of the sales process. Peter needs to develop a presentation for lathe machines.Chapter 14 - Service and Follow-Up for Customer Retention 14-21 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 60. What are the elements of the circular relationship in managing a sales call? A. Preapproach, presentation, and close B. Approach, presentation, and close C. Planning, implementation, and documentation D. Planning, implementation, and evaluation E. Presentation, close, and follow up Answer: D Learning Objective: 14-04 Topic: So, How Does Service Increase Your Sales? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Planning, implementation, and evaluation are the components of the circular relationship. Salespeople are continually planning, implementing, and evaluating their purpose, plans, and success for contacting each customer. 61. You have completed the sales call and are no longer with the client. What should be your immediate next step? A. Meet with your sales lead club B. Identify the competition C. Evaluate the sales call D. Contact new referrals E. Plan a follow-up call Answer: C Learning Objective: 14-04 Topic: So, How Does Service Increase Your Sales? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Planning, implementation, and evaluation are the components of the circular relationship. After a salesperson has planned and implemented a sales call, the next step is to evaluate it. 62. Successful account penetration: A. requires a salesperson to develop a third-level business friendship with members of the buying center. B. makes gatekeepers and influencers nonessential members of the buying center. C. leads to greater chance of maximizing sales within the account. D. can only occur with new-task buying. E. relies on team selling. Answer: C Learning Objective: 14-03 Topic: Account Penetration Is a Secret to Success Blooms: Understand AACSB: AnalyticChapter 14 - Service and Follow-Up for Customer Retention 14-22 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: The ability to work and contact people throughout the account, discussing your products, is referred to as account penetration. As a general rule, the greater your account penetration, the greater your chances of maximizing sales within the account. 63. _____ refers to a salesperson's ability to work and contact people throughout an account, to discuss a product. A. Order taking B. Sales power C. Account accessibility D. Customer satisfaction E. Account penetration Answer: E Learning Objective: 14-03 Topic: Account Penetration Is a Secret to Success Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The ability to work and contact people throughout the account, discussing your products, is referred to as account penetration. Successful penetration of an account allows you to properly service that account by uncovering its needs and problems. 64. Which of the following measures is NOT used to determine how well a salesperson has penetrated an account? A. Number of referrals earned from the account B. Product distribution within the account C. Sales growth in the account D. Advertising activity E. Allotted shelf space Answer: A Learning Objective: 14-03 Topic: Account Penetration Is a Secret to Success Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Account penetration is determined by product distribution, sales growth, advertising and display activity, and shelf space. The number of referrals earned is irrelevant to account penetration.Chapter 14 - Service and Follow-Up for Customer Retention 14-23 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 65. In general, the greater your account penetration, ____. A. the greater your chances of maximizing sales within the account. B. the greater your ability to control the customer and future sales. C. the greater your ability to overcome customer objections. D. the lower the possibility of relationship selling. E. the lower the possibility of a repeat purchase. Answer: A Learning Objective: 14-03 Topic: Account Penetration Is a Secret to Success Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The ability to work and contact people throughout the account, discussing your products, is referred to as account penetration. As a general rule, the greater your account penetration, the greater your chances of maximizing sales within the account. 66. A photocopier salesperson is trying to determine how often he should call on a new account in order to provide proper service. He most likely has to consider all of the following EXCEPT: A. present and potential sales. B. servicing needs of purchased products. C. number of product lines sold to the account. D. number of orders expected annually from the account. E. the necessity and cost of overnight travel to visit the account. Answer: E Learning Objective: 14-03 Topic: Service Can Keep Your Customers Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The salesperson determines the frequency of calls based on present and future sales, servicing requirements, and the number of product lines sold. The need and expense of travel is less relevant to the decision to provide customer service.Chapter 14 - Service and Follow-Up for Customer Retention 14-24 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 67. According to the text, nothing destroys a relationship with a customer faster than: A. not selecting the appropriate method of sales presentation. B. not accurately identifying a customer's needs. C. not achieving sufficient account penetration. D. not offering the lowest prices. E. not following through on promises. Answer: E Learning Objective: 14-03 Topic: Service Can Keep Your Customers Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Nothing destroys a relationship with a customer faster than not following through on promises. Professional buyers do not tolerate promises made and subsequently broken. 68. A salesperson should consider _____ when determining how often to call on an account. A. present and potential sales to the account B. the gender and age of the customer C. number of employees in the organization D. the account's mission statement E. the company's revenue figures for the previous year Answer: A Learning Objective: 14-03 Topic: Service Can Keep Your Customers Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The salesperson determines the frequency of calls based on present and future sales, servicing requirements, and the number of product lines sold. Factors about the organization are less relevant to the decision.Chapter 14 - Service and Follow-Up for Customer Retention 14-25 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 69. The most productive number of sales calls to make to a customer has been reached when: A. demand equals supply. B. additional calls do not result in additional sales. C. marginal cost equals marginal revenue. D. the salesperson works five full days per week. E. the total cost of sales calls equals the value of business from that customer. Answer: B Learning Objective: 14-03 Topic: Service Can Keep Your Customers Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A salesperson should invest sales time in direct proportion to the actual or potential sales represented by each account. The most productive number of calls is reached at the point at which additional calls do not increase sales to the customer. This relationship of sales volume to sales calls is referred to as the response function of the customer to the salesperson’s calls. 70. When determining how frequently to call a customer, a salesperson should primarily base the decision on the relationship between sales volume and sales calls, which is known as the: A. prospecting component. B. sales investment factor. C. account penetration. D. response function. E. opportunity cost. Answer: D Learning Objective: 14-03 Topic: Service Can Keep Your Customers Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A salesperson should invest sales time in direct proportion to the actual or potential sales represented by each account. The most productive number of calls is reached at the point at which additional calls do not increase sales to the customer. This relationship of sales volume to sales calls is referred to as the response function of the customer to the salesperson’s calls.Chapter 14 - Service and Follow-Up for Customer Retention 14-26 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 71. Charles Landon sells software to large manufacturing firms. He strives to convert prospects into customers. After customers have purchased from Charles, what is the LEAST likely action he should take if he wants to ensure future sales? A. Keeping service promises B. Increasing account penetration C. Contacting the account regularly D. Asking about the prices offered by competitors E. Providing the customer with problem-solving ideas Answer: D Learning Objective: 14-03 Topic: Service Can Keep Your Customers Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: Charles should uphold his promises, focus on account penetration, contact the account regularly, and offer problem-solving suggestions. It would be unprofessional for Charles to try to find out the prices of a competitor. 72. To show how much he appreciates the business of a regular customer, Claude, a software salesperson, should do all of the following EXCEPT: A. send information about problems with competing products. B. call the customer when he solves a problem for the customer. C. send greeting cards for birthdays and other special occasions. D. write congratulatory notes to customers who receive awards. E. e-mail information to customers about relevant product modifications. Answer: A Learning Objective: 14-03 Topic: Service Can Keep Your Customers Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Claude should show appreciation by contacting customers when he solves a problem, sending cards and notes, and e-mailing information related to product changes.IT would be unprofessional of Claude to send the client negative information about a competitor.Chapter 14 - Service and Follow-Up for Customer Retention 14-27 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 73. Ben is a salesperson for a company that manufactures gardening equipment. Why does Ben most likely insist on mailing his retail customers, birthday, holiday, and special occasion cards containing seed packs? A. To encode his message of service B. To show his appreciation of his customers C. To create word-of-mouth advertising D. To express non-verbal communication E. To meet customers’ supply needs Answer: B Learning Objective: 14-03 Topic: Service Can Keep Your Customers Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Ben sends cards with seed packets to express appreciation to his customers. Ben’s customers contribute to his success, so he is showing gratitude for their business. 74. After losing a client to a competitor, a salesperson should most likely strive to: A. call the customer every day to schedule a sales presentation. B. criticize competitors during a meeting with the customer. C. request an arbitrator to negotiate a new contract. D. determine the reason for losing the account. E. categorize the client as an orphan account. Answer: D Learning Objective: 14-04 Topic: You Lose a Customer—Keep on Trucking Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A salesperson who loses an account should contact the buyer and friends within the account to determine why the customer dropped the account. Criticizing the competitor is unprofessional.Chapter 14 - Service and Follow-Up for Customer Retention 14-28 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 75. Monica, an electrical parts salesperson, lost one of her big accounts to a competitor. It would be appropriate for Monica to respond in all of the following ways EXCEPT by: A. visiting the customer quickly and finding out why the change was made. B. expressing appreciation to the customer for past business transactions. C. pointing out the flaws and high prices of competing products. D. treating the former customer as a prospect by making calls. E. communicating an interest in meeting future needs. Answer: C Learning Objective: 14-04 Topic: You Lose a Customer—Keep on Trucking Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The salesperson should find out why she lost the account and show appreciation for past business without being rude. At this point, the salesperson should treat the customer like a prospect and try to win the business back. 76. Which of the following is NOT a reason why a customer might be dissatisfied with a product? A. Product was not delivered by the specified date. B. Product delivered was different from the one ordered. C. The product performed an additional, unadvertised function. D. Customer believed the product could perform a function that it cannot. E. Discounts offered by the salesperson were not given by the manufacturer. Answer: C Learning Objective: 14-05 Topic: Handle Complaints Fairly Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Products are typically returned because the wrong product was delivered or delivery was late. It would be a benefit for a customer if a product included additional features. 77. When is a customer most likely to make a complaint? A. The product has been backordered. B. The product has more features than expected. C. The customer received a larger discount than expected. D. The product quality is better than expected. E. The product arrived on the date specified in the contract. Answer: A Learning Objective: 14-05 Topic: Handle Complaints Fairly Blooms: Remember AACSB: Analytic Level of Difficulty: EasyChapter 14 - Service and Follow-Up for Customer Retention 14-29 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: A customer would most likely complain if product was backordered. Products with unexpected features or that are delivered on time will most likely not cause complaints. 78. It is said that "The customer is always right." But according to the text the customer is wrong when: A. demanding fast delivery of a product. B. requesting a refund for damaged goods. C. lodging an unfounded complaint. D. asking for a manufacturer’s discount. E. requesting terms that harm the seller. Answer: E Learning Objective: 14-05 Topic: Is the Customer Always Right? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A customer is dishonest and not right when trying to gain terms that harm the seller and benefit the buyer. In most cases the customer is always right, such as wanting fast delivery, a refund for damaged goods, or a discount. Sometimes a customer makes an honest complaint that is incorrect, at which time the salesperson should make a fair settlement to avoid losing an account. 79. As a salesperson, part of your job in handling a customer complaint is to do all of the following EXCEPT: A. obtaining relevant information from the customer. B. expressing sincere regret for the customer’s problem. C. handling the complaint quickly and efficiently. D. following up to make sure the customer is satisfied. E. pointing out the poor service offered by competitors. Answer: E Learning Objective: 14-05 Topic: Is the Customer Always Right? Blooms: Remember AACSB: Communication Level of Difficulty: Easy Explanation: When handling complaints a salesperson should gather information from the customer, express regret, handle the complaint quickly, and follow up with the client. Highlighting problems with the competition will not resolve the problem.Chapter 14 - Service and Follow-Up for Customer Retention 14-30 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 80. Rick Lee delivers milk, eggs, cottage cheese and orange juice to 200 regular customers weekly. Imagine that after he made a predawn delivery, a dog spilled the milk and broke the eggs. When the customer calls to complain, Lee should: A. blame the dog. B. ignore the complaint. C. replace the food quickly. D. call local animal control. E. refer the customer to another dairy firm. Answer: C Learning Objective: 14-05 Topic: Is the Customer Always Right? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Rick should handle the complaint quickly by providing a new supply of milk and making sure the customer is satisfied. Blaming others or dropping the customer is unprofessional. 81. According to the text, why should salespeople dress in armor? A. To deal with rejection B. To handle customer complaints C. To create an open, friendly environment D. To deal with the ethical dilemmas that occur in sales E. To increase account response rates and customer referrals Answer: D Learning Objective: 14-05 Topic: Is the Customer Always Right? Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: Each day before leaving for work, the salesperson should prepare to meet a few unethical and dishonest people. This requires a person to have tough skin, even armor.Chapter 14 - Service and Follow-Up for Customer Retention 14-31 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 82. A salesperson who is a true professional: A. keeps customers informed about competitors. B. leave beliefs and morals out of business dealings. C. speaks well of others, including the competition. D. knows when to use high pressure techniques on prospects. E. knows that finding new customers is more important than servicing current ones. Answer: C Learning Objective: 14-04 Topic: Build a Professional Reputation Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: A professional salesperson speaks well of others, does not discuss the competition, and is honest and moral. High pressure tactics are viewed negatively. 83. A survey of purchasing agents shows that they believe it is most important for salespeople to: A. refuse to accept "no" as an answer. B. conduct regular service calls. C. make unplanned cold calls. D. avoid dramatics in sales presentations. E. keep customers informed about competitors. Answer: B Learning Objective: 14-01 Topic: Do’s and Don’ts for Business Salespeople Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: Surveys indicate that salespeople are expected to make regular service calls and be knowledgeable about the industry and products. However, it is unprofessional for a salesperson to talk about the competition. 84. All of the following are the most important traits purchasing agents find in their top salespeople EXCEPT: A. willingness to find out the prices of the competition. B. thoroughness and follow-through after the sale. C. willingness to go bat for the buyer within the supplier's firm. D. knowledge of the firm's product line. E. preparation of sales calls. Answer: A Learning Objective: 14-01 Topic: Do’s and Don’ts for Business Salespeople Blooms: Understand AACSB: Ethics Level of Difficulty: MediumChapter 14 - Service and Follow-Up for Customer Retention 14-32 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Following up on a sale, going to bat for the buyer, showing knowledge of the product, and preparing for sales calls are important qualities in salespeople. However, it is unethical and unprofessional to try to gather information about a competitor’s prices. 85. In any type of sales, salespeople should most likely remember to: A. avoid seeking customers because customers find sellers. B. use highly structured, memorized sales presentations. C. ask people during approach to buy their products. D. spend all their time helping existing customers. E. provide follow-up and service after the sale. Answer: E Learning Objective: 14-01 Topic: The Path to Sales Success: Seek, Knock, Ask, Serve Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: In any sales it is important to seek customers to serve and you will find them; knock and people will open their doors; ask and people will buy; provide service after the sale and customers will buy again. 86. Which of the following is one of the seven deadly sins of business selling? A. Overplanning a sales call B. Demonstrating the product too often C. Promising more than can be delivered D. Failing to provide the lowest prices in the industry E. Exhibiting a lack of knowledge about the competition Answer: C Learning Objective: 14-01 Topic: Do’s and Don’ts for Business Salespeople Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Unlimited optimism is considered a deadly sin of selling. Honesty is preferred to the hallmark of the good news bearers who promise anything to get an order. Never promise more than you can deliver.Chapter 14 - Service and Follow-Up for Customer Retention 14-33 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 87. A salesperson should most likely refuse to handle a complaint if the: A. customer is wrong. B. customer is being dishonest. C. customer complaint is about discounts. D. customer says that the product delivered is unsalable. E. customer complains that the quality of the product is low. Answer: B Learning Objective: 14-05 Topic: Returned Goods Make You a Hero Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Customer complaints should be addressed even when the customer may be incorrect to avoid losing the customer. However, a salesperson is less likely to give a dishonest customer the benefit of the doubt. 88. In your position as an electronics salesperson, one of your retailers tells you to take back some unsalable goods. You are not sure if the customer's claim is honest or not. You do not want to make the retailer unhappy as he brings you good business. How do you tackle this situation? A. Ask the customer to avoid being dishonest. B. Apologize to the customer and inform him that you are not sure of his claim. C. Give the benefit of doubt to the customer and return the goods. D. Never return the goods if you are not sure that the customer's claim is true. E. Return half the merchandise if the customer is correct. Answer: C Learning Objective: 14-05 Topic: Is the Customer Always Right? Blooms: Understand AACSB: Ethics Level of Difficulty: Medium Explanation: In most cases, it is best to give the customer the benefit of the doubt to avoid losing future business. If the salesperson was sure that the customer was being dishonest, then it would be appropriate not to make the return.Chapter 14 - Service and Follow-Up for Customer Retention 14-34 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 89. A salesperson for aquarium equipment walks into the office of a prospect unannounced. He then engages in a small talk with the prospect. According to the text, this is an example of: A. poor planning. B. wasting time. C. professional conduct. D. pushiness. E. limited optimism. Answer: B Learning Objective: 14-01 Topic: Do’s and Don’ts for Business Salespeople Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Unannounced sales visits are a nuisance to customers. When salespeople start droning on about golf or grandchildren, more time is wasted. 90. Selling requires three Fs. What are they? A. FAB, fluctuations, and forecasts B. Forecasts, FAB, and finances C. Faith, focus, and follow-through D. Fundamentals, features, and follow-up E. Fundamentals, forecasts, and focus Answer: C Learning Objective: 14-01 Topic: The Path to Sales Success: Seek, Knock, Ask, Serve Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Selling takes faith, focus, and follow-through—the three Fs. Never give up. Always continue to seek more knowledge, patience, wisdom, caring, and understanding of others’ situations. Focus on caring for others’ needs.Chapter 14 - Service and Follow-Up for Customer Retention 14-35 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Essay Questions 91. Explain how customer service increases sales for a salesperson. What are some examples of providing excellent customer service? Answer: The salesperson increases sales by obtaining new customers and selling more products to present customers. The best method for obtaining new customers is often customer referrals. Customers provide referrals when they are satisfied with the salesperson. Excellent customer service involves staying in touch with a customer, responding to customer needs promptly, and showing appreciation. Learning Objective: 14-04 Topic: So, How Does Service Increase Your Sales? Blooms: Analyze AACSB: Analytic Level of Difficulty: Hard 92. What is the difference between wisdom and knowledge? How does a salesperson acquire sales wisdom? Answer: The text says there is a vast difference between wisdom and knowledge. Knowledge is having the facts. Wisdom is knowing how to apply facts to situations. Wisdom is acquired by learning to trust and honor people; realizing that your purpose is to help people; making a lifelong series of right choices and avoid moral pitfalls; and learning from your mistakes and recovering. Learning Objective: 14-01 Topic: The Importance of Service and Follow-Up Blooms: Analyze AACSB: Analytic Level of Difficulty: Hard 93. Identify and define the three levels of business friendship. Answer: The three levels of friendship in a business are: (1 ) Acquaintances: These are people whose names the salesperson knows, sees occasionally and whom they know little about even if they have known them for a long time. (2) Friends: These are the people with whom the salesperson spends time with and share common interests and/or hobbies. (3) Intimate friends: They are the people the salesperson knows on a deeper level. Learning Objective: 14-02 Topic: Building a Long-Term Business Friendship Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 14 - Service and Follow-Up for Customer Retention 14-36 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 94. Identify and define the three levels of customer relationship marketing. Answer: The three levels of customer relationship marketing are: (1) Transaction selling: The salesperson sells to customer and does not contact them again. (2) Relationship selling: After the sales, the salesperson finds out if the customer is satisfied and has future needs. (3) Partnering: The salesperson works continuously to improve the customer's operations, sales, and profits. Learning Objective: 14-02 Topic: Relationship Marketing and Customer Retention Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 95. What is account penetration? What determines a salesperson's level of account penetration? Answer: The ability to work with and contact people throughout the account, to discuss the product is referred to as account penetration. A salesperson's level of account penetration is determined in the following four ways: (1) the total and major-brand sales growth in an account, (2) the distribution of the number of the products in a product line, (3) the level of cooperation the salesperson has obtained with the customer, and freedom to visit people in the account, and (4) the salesperson's reputation as the authority on his/her type of merchandise for the buyer. Learning Objective: 14-03 Topic: Account Penetration Is a Secret to Success Blooms: Analyze AACSB: Analytic Level of Difficulty: HardChapter 14 - Service and Follow-Up for Customer Retention 14-37 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 96. When does a salesperson achieve the most productive number of sales calls? Answer: The most productive number of calls is reached at the point at which additional calls to the customer do not increase sales. This relationship between the number of sales calls and sales volume is referred to as the response function of the customer to the salesperson's calls. Learning Objective: 14-04 Topic: Service Can Keep Your Customers Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 97. How can you show your appreciation to customers? Answer: You can show your appreciation to regular customers by telephoning whenever you think of or see something that can solve one of their problems, mailing clippings that may be of interest to them, writing congratulatory notes to those who have been elected to office or promoted or given awards, sending newspaper clippings about the customer's family (marriages, births, and activities), sending holiday or special-occasion cards, sending annual birthday cards, preparing and sending quarterly newsletters which keeps them informed on important matters, faxing and/or e-mailing information to prospects and buyers, etc. Learning Objective: 14-04 Topic: Service Can Keep Your Customers Blooms: Understand AACSB: Communication Level of Difficulty: Medium 98. What can you as a salesperson do to win back a valuable account that has been taken by a competitor? Answer: The four things which will help a salesperson to win back an account that has been lost to a competitor are: (1) Visit and investigate to determine why the customer did not buy from you. (2) Be professional. Tell the customer you value his/her past business and friendship and are ready to earn future business. (3) Do not be unfriendly. Never criticize your competitor's product. (4) Keep calling. Treat a former customer like a prospect. Learning Objective: 14-05 Topic: You Lose a Customer-Keep on Trucking Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 14 - Service and Follow-Up for Customer Retention 14-38 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 99. What procedures can be used to solve customer complaints? Answer: To solve customer complaints, a salesperson should obtain as much relevant information from the client as possible, express sincere regret for the problem, display a service attitude, review the record to make sure the product was received, etc. If the customer is right, the salesperson should quickly and cheerfully handle the complaint. Finally, he should follow up and make sure the customer is satisfied. Learning Objective: 14-05 Topic: Is the Customer Always Right? Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 100. What are the "seven deadly sins" of selling? Answer: The "seven deadly sins" of selling are: 1) Lack of product knowledge, 2) time wasting 3) poor planning, 4) pushiness, 5) lack of dependability, 6) unprofessional conduct, and 7) unlimited optimism. Learning Objective: 14-01 Topic: Do’s and Don’t’s for Business Salespeople Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 15 - Time, Territory, and Self-Management: Keys to Success 15-1 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Chapter 15 Time, Territory, and Self-Management: Keys to Success Learning Objectives: 15-01 Discuss the importance of the sales territory. 15-02 Explain the major elements involved in managing the sales territory. 15-03 Explain why salespeople need to segment their accounts by size. 15-04 Calculate a salesperson’s break-even point per day, hour, and year. True / False Questions 1. According to the Golden Rule, how you spend your time greatly influences your level of sales success. Answer: True Learning Objective: 15-01 Topic: The Golden Rule: Time Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: How you spend your time determines your life. It greatly influences the level of your success in sales—and school. Time encompasses the time spent with customers and your life activities. 2. A sales account refers to a limited geographical area assigned to a salesperson. Answer: False Learning Objective: 15-01 Topic: Customers Form Sales Territories Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A sales territory comprises a group of customers or a geographic area assigned to a salesperson. Firms use sales territories to establish each salesperson’s responsibilities and to improve customer relations.Chapter 15 - Time, Territory, and Self-Management: Keys to Success 15-2 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 3. Sales territories can be used to obtain thorough coverage of the market. Answer: True Learning Objective: 15-01 Topic: Customers Form Sales Territories Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Firms use sales territories to obtain a thorough coverage of a market. With proper coverage of territories, a company will reach the sales potential of its markets. 4. Salespeople act as business managers for their territories. Answer: True Learning Objective: 15-01 Topic: Customers Form Sales Territories Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Salespeople act as business managers for their territories. They are responsible for maintaining and generating sales volume. 5. Developing and using sales territories allows management to match salespeople to customer's needs in a better way. Answer: True Learning Objective: 15-01 Topic: Customers Form Sales Territories Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Salespeople are hired and trained to meet the requirements of the customers in a territory. Often, the more similar the customer and the salesperson, the more likely the sales effort will succeed. 6. One major disadvantage of having sales territories is the duplication of efforts by salespeople in the same area. Answer: False Learning Objective: 15-01 Topic: Customers Form Sales Territories Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Sales territories are designed to avoid duplicating efforts so that two salespeople do not travel in the same area. Such benefits as fewer travel miles and fewer overnight trips, plus regular contact with productive customers by the same salesperson, can improve the firm’s sales-to-cost ratio.Chapter 15 - Time, Territory, and Self-Management: Keys to Success 15-3 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 7. The formation of sales territories can help increase sales, but it frequently leads to increased selling costs. Answer: False Learning Objective: 15-01 Topic: Customers Form Sales Territories Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Sales territories are designed to avoid duplicating efforts so that two salespeople do not travel in the same area. Such benefits as fewer travel miles and fewer overnight trips, plus regular contact with productive customers by the same salesperson, can improve the firm’s sales-to-cost ratio. 8. Segmenting the market into territories can be very effective in industries like insurance and retail. Answer: False Learning Objective: 15-01 Topic: Customers Form Sales Territories Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: In spite of advantages, there are disadvantages to developing sales territories for some companies, such as in the real estate and insurance industries. 9. For the salesperson, time and territory management is a continuous process of planning, executing, and evaluating the sales and service provided to customers. Answer: True Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Time and territory management (TTM) is a continuous process of planning, executing, and evaluating the sales and service provided to customers. By completing each of the seven key elements involved in time and TTM, the salesperson ensures that the customers will be provided excellent service.Chapter 15 - Time, Territory, and Self-Management: Keys to Success 15-4 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 10. All companies segment their markets into sales territories. Answer: False Learning Objective: 15-01 Topic: Customers Form Sales Territories Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Not all firms divide markets into sales territories. In spite of many advantages to sales territories, there are disadvantages to developing sales territories for some companies, such as in the real estate and insurance industries. 11. It is the job of the sales manager to set quotas and develop territorial sales plans for reaching the quota; it is the salesperson's job to fulfill that sales quota. Answer: False Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A salesperson is responsible for generating sales in a territory based on its sales potential. The salesperson’s manager typically establishes the total sales quota that each salesperson is expected to reach, but the salesperson develops territorial sales plans. 12. The process of applying and designing selling strategies equally to different accounts is known as a differentiated selling approach. Answer: False Learning Objective: 15-03 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: With the undifferentiated selling approach, salespeople use a single selling approach for all accounts. 13. A market with homogeneous needs and characteristics would best be suited for an undifferentiated market approach. Answer: True Learning Objective: 15-03 Topic: Elements of Time and Territory Management Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 15 - Time, Territory, and Self-Management: Keys to Success 15-5 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Salespeople whose accounts have homogeneous needs and characteristics may find the undifferentiated selling approach useful. The basic assumption underlying this approach is that the account needs for a specific product or group of products are similar. 14. The 80/20 principle is a time management concept that favors a salesperson putting 80 percent of his or her time on planning and 20 percent on selling. Answer: False Learning Objective: 15-03 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: There are few extra-large or large accounts, but they often account for 80 percent of a company’s profitable sales even though they represent only 20 percent of total accounts. This is known as the eighty/twenty principle. 15. The process of applying different selling strategies to different customers and prospects is known as the account segmentation approach. Answer: True Learning Objective: 15-03 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Salespeople using the account segmentation approach recognize that their territories contain accounts with heterogeneous needs and differing characteristics that require different selling strategies. Consequently, they develop sales objectives based on overall sales and sales of each product for each customer and prospect. 16. The majority of sales force resources should be invested in key accounts. Answer: True Learning Objective: 15-03 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The bulk of sales force resources (such as personnel, time, samples, and entertainment expenses) should be invested in the key accounts, and the needs of these large accounts should receive top priority.Chapter 15 - Time, Territory, and Self-Management: Keys to Success 15-6 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 17. It is wise to use the account segmentation approach in a market with heterogeneous needs. Answer: True Learning Objective: 15-03 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Salespeople using the account segmentation approach recognize that their territories contain accounts with heterogeneous needs and differing characteristics that require different selling strategies. 18. Territory time allocation is the time spent by the salesperson calling on accounts excluding the traveling time. Answer: False Learning Objective: 15-03 Topic: Elements of Time and Territory Management Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Time allocation is the time spent by the salesperson traveling around the territory and calling on accounts. The allocation includes the time it takes to travel between customers 19. Multivariable account segmentation means using multiple salespeople to call on a few accounts. Answer: False Learning Objective: 15-03 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Multivariable account segmentation means using more than one criterion to characterize the organization’s accounts. Sales organizations use segmentation because they sell to several markets and use many channel members in these markets.Chapter 15 - Time, Territory, and Self-Management: Keys to Success 15-7 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 20. One of the basic factors to consider in territory-time allocation is non-selling time. Answer: True Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Time allocation is the time spent by the salesperson traveling around the territory and calling on accounts. Factors to consider in time allocation include the number of accounts in the territory, travel time around the territory, and nonselling time. 21. The difference between cost of goods sold and sales is called the gross profit on sales revenue. Answer: True Learning Objective: 15-04 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The difference between cost of goods sold and sales is the gross profit on sales revenue. Gross profit should be large enough to cover selling expenses. 22. Break-even volume per hour = Cost per hour/Gross profit percentage Answer: True Learning Objective: 15-04 Topic: Elements of Time and Territory Management Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Break-even analysis is a quantitative technique for determining the level of sales at which total revenues equal total costs. Break-even volume per hour is calculated by dividing cost per hour by gross profit percentage. 23. The break-even point for a territory for a month is $1,000. If the salesperson generates $1,000 of profit the territory's direct costs are covered. Answer: False Learning Objective: 15-04 Topic: Elements of Time and Territory Management Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: Break-even point is calculated by dividing a salesperson’s fixed costs by gross profit percentage. Break-even analysis determines how much sales volume a salesperson must generate to meet costs in a territory. The difference between cost of goods sold and sales is the gross profit on sales revenue. If profit equals $1,000 then the direct costs are met.Chapter 15 - Time, Territory, and Self-Management: Keys to Success 15-8 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 24. Before making a sales call, the salesperson should first qualify an account, which means the account should meet the firm's credit standards. Answer: False Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Salespeople must be sure that their prospects are qualified to make the purchase decision, and they must determine whether sales to these accounts are large enough to allow for an adequate return on time invested. Qualified does not relate to credit standards. 25. A professional salesperson should study product materials during the waiting time at the customer's office. Answer: True Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Top salespeople work while waiting: studying material about their products, completing call reports, or organizing material for the sales presentation 26. Scheduling refers to establishing the total revenue to be generated from each sales territory. Answer: False Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Scheduling refers to establishing a fixed time (day and hour) for visiting a customer’s business.Chapter 15 - Time, Territory, and Self-Management: Keys to Success 15-9 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 27. Routing refers to the travel pattern the salesperson uses in working a territory. Answer: True Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Routing is the travel pattern used in working a territory. Some sales organizations prefer to determine the formal path or route that their salespeople travel when covering their territory. 28. A formal route enables the organization to establish communication between management and the sales force in terms of the location and activities of individual salespeople. Answer: True Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Formal route designs enable the company to (1) improve territory coverage; (2) minimize wasted time; and (3) establish communication between management and the sales force in terms of the location and activities of individual salespeople. 29. Research indicates that a business lunch almost always leads directly to a quick sale. Answer: True Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Results of one study show that the business lunch does not lead directly to a sale, but to the buyer and seller knowing each other better, which builds confidence and trust. In turn, this may lead to sales in the long run. 30. Technology such as GPS is useful for locating customers and planning routes. Answer: True Learning Objective: 15-02 Topic: In-Vehicle Technology Blooms: Remember AACSB: Technology Level of Difficulty: Easy Explanation: A GPS system can be used to locate customers, restaurants, and local businesses and help with planning efficient routes.Chapter 15 - Time, Territory, and Self-Management: Keys to Success 15-10 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 31. A salesperson leaves early from home and drives to the far end of her territory before making the first call. Then she works her way back so that she ends up near home at the end of the day. This is called the straight-line method of routing sales calls. Answer: True Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: If most accounts are in a straight line from your home, leave early and drive to the far end of your territory before making your first call, then work your way back so that you end up near home at the end of the day, which is called the straight-line method 32. Satisfying the service needs of accounts by telephone is not recommended for salespeople despite in cost reductions. Answer: False Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The increasing cost of a personal sales call and the increasing amount of time spent traveling to make personal calls are reasons for the efficient territory manager to look to the telephone as a territory coverage tool. With field sales costs still rising and no end in sight, more companies are developing telephone sales and marketing campaigns to supplement personal selling efforts. 33. The three basic routing patterns used by salespeople are straight-line, cloverleaf, and major-city. Answer: True Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The straight-line, cloverleaf, and major-city are the three basic routing patterns used by salespeople.Chapter 15 - Time, Territory, and Self-Management: Keys to Success 15-11 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 34. Territorial evaluations use quantitative quotas or goals instead of qualitative quotas to determine the performance of individual territories. Answer: False Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Territorial evaluation is the establishment of performance standards for the individual territory in the form of qualitative and quantitative quotas or goals. Actual performance is compared to these goals for evaluation purposes. 35. Experts recommend that salespeople limit themselves to no more than two routes per day to make sure enough time is spent with each customer. Answer: False Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: There is no right number of sections or routes for all salespersons. It depends on the size of your territory, the geographic layout of your area, and the call frequencies you want to establish. Multiple Choice Questions 36. Many companies concentrate on improving the way their salespeople manage their time and territories because: A. the cost of direct selling is rapidly decreasing. B. the time available for face-to-face customer contact is increasing. C. there is reduced emphasis on profitability. D. time is always limited. E. they want to increase the salesperson’s responsibilities. Answer: D Learning Objective: 15-01 Topic: The Golden Rule: Time Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Since time is limited, firms focus on maximizing their salespeople’s time. Time and territory management enables firms to cover the market effectively and efficiently.Chapter 15 - Time, Territory, and Self-Management: Keys to Success 15-12 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 37. A(n) _____ comprises a group of customers or a geographical area assigned to a salesperson. A. market development area B. undifferentiated account C. sales territory D. market segment E. business domain Answer: C Learning Objective: 15-02 Topic: Customers Form Sales Territories Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A sales territory comprises a group of customers or a geographic area assigned to a salesperson. The territory may or may not have geographic boundaries. 38. Which of the following statements about sales territories is INCORRECT? A. A sales territory contains present customers. B. Geographic boundaries define a sales territory. C. Firms use sales territories to evaluate performance. D. A sales territory typically contains potential customers. E. A sales territory comprises a geographic area assigned to a salesperson. Answer: B Learning Objective: 15-01 Topic: Customers Form Sales Territories Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A sales territory comprises a group of current and potential customers or a geographic area assigned to a salesperson. The territory may or may not have geographic boundaries. Territories help firms evaluate sales performance.Chapter 15 - Time, Territory, and Self-Management: Keys to Success 15-13 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 39. A company most likely forms sales territories to: A. sell a complex product. B. obtain thorough market coverage. C. operate fully in a monopolistic market. D. use an undifferentiated selling approach. E. control its credit rating more effectively. Answer: B Learning Objective: 15-01 Topic: Customers Form Sales Territories Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Companies establish sales territories to cover a market thoroughly, establish responsibilities, avoid duplicating work, create good relationships with customers, and meet sales goals. Territories are irrelevant to credit ratings. 40. For a salesperson, time and territory management: A. is the process of defining homogeneous customer segments. B. is most relevant during periods of economic recession. C. is useful only when selling homogeneous products. D. is a continuous process of planning, executing, and evaluating sales. E. requires an efficient and effective customer service manager. Answer: D Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: For the salesperson, time and territory management is a continuous process of planning, executing, and evaluating the sales and service provided to customers. By completing each of the seven key elements involved in time and territory management the salesperson ensures customers will be provided excellent serviceChapter 15 - Time, Territory, and Self-Management: Keys to Success 15-14 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 41. The first step of time and territory management is: A. setting quotas. B. seeking referrals. C. scheduling calls. D. planning travel routes. E. engaging in prospecting. Answer: A Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Setting sales goals or quotas is the first step of time and territory management. Scheduling and routing occur later in the process. 42. Sutton Powell studies the sales potential of present and potential customers in her territory in order to estimate each account's potential and to make the best use of her time. This process is called: A. customer sales planning. B. route reporting. C. territory-time allocation. D. account analysis. E. trend assessment. Answer: D Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Account analysis refers to identifying accounts and their varying levels of sales potential. 43. After conducting an account analysis in the time and territory management process, salespeople should: A. set account objectives and sales quotas. B. manage scheduling and routing. C. conduct customer sales planning. D. evaluate customers and accounts. E. conduct territory evaluations. Answer: A Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 15 - Time, Territory, and Self-Management: Keys to Success 15-15 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: After an account analysis has been completed, the salesperson should set account objectives and sales quotas. Customer sales planning, scheduling, routing, and territory and customer evaluations are conducted later in the process. 44. The two general approaches to _____ for salespeople are undifferentiated selling and account segmentation. A. customer sales planning B. route reporting C. territory-time allocation D. quota regression analysis E. account analysis Answer: E Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Two general approaches to account analysis —identifying accounts and their varying levels of sales potential—are the undifferentiated selling approach and the account segmentation approach. 45. According to the text, the general approaches to account analysis for salespeople are _____ and ______ A. personal selling; group selling. B. undifferentiated selling; account segmentation. C. mass marketing; target marketing. D. integrated selling; aggregated selling. E. mass customization; personalization. Answer: B Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Two general approaches to account analysis —identifying accounts and their varying levels of sales potential—are the undifferentiated selling approach and the account segmentation approach.Chapter 15 - Time, Territory, and Self-Management: Keys to Success 15-16 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 46. The undifferentiated selling approach is used when the: A. target market is homogeneous. B. company is selling only in the home market. C. company has a complex product line. D. salespeople are highly experienced and skilled. E. company is a new entrant in the market. Answer: A Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: An organization may see the accounts in its market as similar. When this happens and selling strategies are designed and applied equally to all accounts, the salesperson uses an undifferentiated selling approach. 47. Which selling approach would most likely involve a salesperson using the same selling strategy for all customers? A. Homogeneous selling B. Heterogeneous selling C. Account segmentation D. TTM segmentation E. Undifferentiated selling Answer: E Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: With the undifferentiated selling approach, a salesperson may use the same sales presentation in selling an entire product line. The salesperson feels he or she can satisfy most customers with a single selling strategy because the accounts in the market are similar. 48. Which of the following statements about undifferentiated selling is most likely true? A. The undifferentiated selling approach is only useful if customers are heterogeneous. B. Many door-to-door salespeople use the undifferentiated approach. C. The undifferentiated selling approach allows salespeople to devote time to customers in proportion to the customer's potential value. D. The undifferentiated selling approach allows salespeople to streamline their pre-call preparation and thus is growing in popularity. E. Undifferentiated selling cannot be used in conjunction with a stimulus-response presentation. Answer: B Learning Objective: 15-02 Topic: Elements of Time and Territory ManagementChapter 15 - Time, Territory, and Self-Management: Keys to Success 15-17 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: With the undifferentiated selling approach the salesperson feels he or she can satisfy most customers with a single selling strategy. Many door-to-door salespeople use the same selling strategies with each person they contact (a stimulus–response sales presentation). 49. Stephen started a new company which manufactures vacuum cleaners. He hired four salespeople and decided to use the door-to-door selling technique to sell his products. Which selling approach will most likely be used by the salespeople? A. Account segmentation B. Undifferentiated C. Customized D. Specific E. Unstructured Answer: B Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Most door-to-door salespeople use the same selling strategies with each person they contact, which means they use the undifferentiated selling approach. Stephen must feel that he can satisfy most customers with a single selling strategy.Chapter 15 - Time, Territory, and Self-Management: Keys to Success 15-18 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 50. Salespeople using the _____ approach recognize their territories contain accounts with heterogeneous needs and differing characteristics that require different selling strategies. A. account segmentation B. market diversification C. undifferentiated selling approach D. territorial development E. market penetration Answer: A Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Salespeople using the account segmentation approach recognize that their territories contain accounts with heterogeneous needs and differing characteristics that require different selling strategies. Consequently, they develop sales objectives based on overall sales and sales of each product for each customer and prospect. 51. When a salesperson refers to her key accounts, she is talking about her _____ accounts. A. orphaned B. homogeneous C. extra-large D. governmental E. undifferentiated Answer: C Learning Objective: 15-03 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Key accounts are the extra-large accounts in a sales territory. These accounts are target customers because they are highly profitable. 52. Sales managers use the ELMS system to: A. identify demographic characteristics so that customer needs match sales goals. B. evaluate salespeople during annual performance appraisals. C. match the personalities of salespeople and customers. D. create the most efficient travel routes for salespeople. E. categorize accounts in terms of profitability. Answer: E Learning Objective: 15-03 Topic: Elements of Time and Territory Management Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 15 - Time, Territory, and Self-Management: Keys to Success 15-19 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Accounts are classified broadly by salespeople in the account segmentation approach. Categories or types of accounts are defined in terms such as extra-large (key), large, medium, and small, which we refer to as the ELMS system. 53. Which of the following is a method used to define accounts in terms of their size? A. OAKS B. KISS C. FAB D. ELMS E. SELL Answer: D Learning Objective: 15-03 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Categories or types of accounts are defined by size in terms such as extra-large (key), large, medium, and small, which we refer to as the ELMS system. 54. The use of the ELMS system is most closely related to the: A. 50-50 method. B. 80/20 principle. C. SELL sequence D. FAB closing. E. KISS selling process. Answer: B Learning Objective: 15-03 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The 80/20 principle is most relevant to the ELMS system of designating accounts by size. The 80/20 principle asserts that large accounts are the reason for 80 percent of a company’s profitable sales even though they represent only 20 percent of total accounts. 55. The 80/20 principles can be used to explain why salespeople use: A. the ELMS system to segment accounts in their sales territories. B. trial closes a minimum of three times per sales call. C. three different types of routing patterns. D. waiting time for non-selling activities. E. mobile offices and technological tools. Answer: A Learning Objective: 15-03 Topic: Elements of Time and Territory Management Blooms: UnderstandChapter 15 - Time, Territory, and Self-Management: Keys to Success 15-20 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Medium Explanation: The 80/20 principle is most relevant to the ELMS system of designating accounts by size. The 80/20 principle asserts that large accounts are the reason for 80 percent of a company’s profitable sales even though they represent only 20 percent of total accounts. 56. The 80/20 principle: A. is a territorial management concept that favors a salesperson putting 80 percent of his time on planning and 20 percent on action. B. refers to the fact that eighty salespeople require twenty sales managers to keep the appropriate 1-to-4 ratio of supervisors to employees. C. indicates that no matter how hard a salesperson tries, 80 percent of the customer's potential business ends up going to competitors. D. is a territorial management concept that favors a salesperson putting 80 percent of her time on action and 20 percent on planning. E. refers to the idea that 20 percent of a firm's customers account for 80 percent of a firm’s profitability. Answer: E Learning Objective: 15-03 Topic: Elements of Time and Territory Management Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The 80/20 principle is most relevant to the ELMS system of designating accounts by size. The 80/20 principle asserts that large accounts are the reason for 80 percent of a company’s profitable sales even though they represent only 20 percent of total accounts. 57. According to the text, when a company directs its sales force members to use multiple selling strategies, this means salespeople are expected to: A. split commissions if a buyer's purchasing office is in one salesperson's territory and the retail outlet is the territory of another salesperson. B. have several sales approaches planned so that if their first sales attempt is unsuccessful, they can shift to an alternate approach without delay. C. develop different sales approaches for the different products in the company's product line. D. invest the bulk of their time and resources in the key accounts in their territories. E. develop one form of presentation for existing accounts and another for prospects. Answer: D Learning Objective: 15-03 Topic: Elements of Time and Territory Management Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The bulk of sales force resources (such as personnel, time, samples, and entertainment expenses) should be invested in the key accounts, and the needs of these largeChapter 15 - Time, Territory, and Self-Management: Keys to Success 15-21 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. accounts should receive top priority. Therefore, salespeople use multiple selling strategies. 58. _____ means using more than one criterion to characterize an organization's accounts. A. Parallel account integration B. Multiple positioning C. Multivariable account segmentation D. Operational integration E. Horizontal integration Answer: C Learning Objective: 15-03 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Multivariable account segmentation means using more than one criterion to characterize the organization’s accounts. Sales organizations use segmentation because they sell to several markets and use many channel members in these markets. 59. Dividing accounts on the basis of the types of accounts and sales volume would be an example of: A. multivariable account segmentation. B. market integration. C. parallel account management. D. territory-aggregate management. E. double positioning. Answer: A Learning Objective: 15-03 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Multivariable account segmentation means using more than one criterion to characterize the organization’s accounts. Sales organizations use segmentation because they sell to several markets and use many channel members in these markets. Furthermore, they may emphasize different products, product sizes, or product lines to different channel members in various markets.Chapter 15 - Time, Territory, and Self-Management: Keys to Success 15-22 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 60. Hana Cho sells gas-powered generators. She finds it useful to divide the accounts in her territory on the basis of whether they sell at wholesale or retail as well as according to their potential sales volume. Cho is using: A. dual operational integration. B. multivariable account segmentation. C. parallel account integration. D. territory-aggregate management. E. double positioning. Answer: B Learning Objective: 15-03 Topic: Elements of Time and Territory Management Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Cho is using multivariable account segmentation, which involves using more than one criterion to characterize the organization’s accounts. The type of market, environment, account sales potential, and sales volume are major variables for segmenting accounts. 61. The J&L Grocery Distribution Company characterizes its customers according to their yearly sales potential and whether the account is a retailer, wholesaler, or government agency. This approach to segmentation is called: A. undifferentiated selling. B. double-positioning. C. multivariable account segmentation. D. parallel account segregation. E. total territory management. Answer: C Learning Objective: 15-03 Topic: Elements of Time and Territory Management Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The firm is using multivariable account segmentation, which uses more than one criterion to characterize the organization’s accounts. The type of market, environment, account sales potential, and sales volume are major variables for segmenting accounts.Chapter 15 - Time, Territory, and Self-Management: Keys to Success 15-23 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 62. "To increase the product assortment purchased by current customers by two percent during the next three months," is an example of a(n): A. market quota. B. derived demand. C. account objective. D. future product quotient. E. net product forecast. Answer: C Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Increasing the assortment of products purchased by two percent is an account objective. Other objectives might be increasing product distribution to prospects in the territory or increasing the number of sales calls. 63. James Lambert is an assistant territory sales manager at Cellcom, a leading wireless service provider in Europe. James manages the salespeople in a small city in France. There are many players in the wireless service provider market, and it is becoming increasingly difficult to position the company as unique. What can James do to position Cellcom as a unique company, when compared to its competitors? A. Reduce the call rates by half. B. Increase the mass media advertising of Cellcom. C. Instruct salespeople to spend more time on each sales call. D. Ask salespeople to discuss the weakness of competition in every sales call. E. Substantially reduce the salespeople's visits to the small accounts and increase the visits to key accounts. Answer: C Learning Objective: 15-03 Topic: Elements of Time and Territory Management Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: James should strive to create the image that Cellcom is uniquely better than the competition. One way to accomplish this is to spend more time on each sales call and to make more total sales calls during the year, thus providing a problem-solving approach to servicing accounts.Chapter 15 - Time, Territory, and Self-Management: Keys to Success 15-24 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 64. According to the text, which of the following is one of the seven basic factors to be considered in the allocation of a salesperson's time? A. Nonselling time B. Product price C. Total revenue of the company D. Number of competitors E. Estimated sales volume Answer: A Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Time allocation is the time spent by the salesperson traveling around the territory and calling on accounts. There are seven basic factors to consider in time allocation including nonselling time, the number of accounts in the territory, and the number of sales calls made on customers. 65. Which of the following is NOT one of the seven basic factors to consider in the allocation of a salesperson's time? A. Frequency of customer sales calls B. Return on time invested C. Nonselling time D. Compensation E. Travel time Answer: D Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: There are seven basic factors to consider in time allocation including frequency of calls, return on time invested, nonselling time, and travel time around the territory. Compensation is not a factor to consider.Chapter 15 - Time, Territory, and Self-Management: Keys to Success 15-25 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 66. Madison works for a weed killer manufacturing company. The products have only been available in a concentrated liquid form, but now the firm is introducing a pre-mixed version that should be easier for consumers to use. Madison will most likely increase the frequency of sales calls because: A. the available supply is limited and costly. B. there is no competition within the sales territory. C. demand is low for his company's older products. D. customers are less likely to buy products from the competition. E. his company has increased the number of product lines available. Answer: E Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Analyze AACSB: Analytic Level of Difficulty: Hard Explanation: Madison will increase the frequency of calls because there has been an increase in the number of product lines sold. Madison needs to make customers aware of the new product. 67. A salesperson invests time in direct proportion to the actual or potential sales that the account represents. This relationship of sales volume to sales calls is the: A. sales response function. B. break-even function. C. time allocation coefficient. D. territory coefficient. E. alternate correlation. Answer: A Learning Objective: 15-04 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Typically, the salesperson invests sales time in direct proportion to the actual or potential sales that the account represents. The most productive number of calls is reached at the point at which additional calls do not increase sales. This relationship of sales volume to sales calls is the sales response function of the customer to the salesperson’s calls.Chapter 15 - Time, Territory, and Self-Management: Keys to Success 15-26 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 68. The difference between sales and _____ is the gross profit on sales revenue. A. fixed costs B. variable costs C. cost of goods sold D. total productive hours E. average annual expenses Answer: C Learning Objective: 15-04 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The difference between cost of goods sold and sales is the gross profit on sales revenue. Gross profit should be large enough to cover selling expenses. 69. _____ is a quantitative technique for determining the level of sales at which total revenues equal total costs. A. Sales response function B. Equilibrium analysis C. Variable cost analysis D. Break-even analysis E. ELMS function Answer: D Learning Objective: 15-04 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Break-even analysis is a quantitative technique for determining the level of sales at which total revenues equal total costs. Break-even analysis determines how much sales volume a salesperson must generate to meet costs in a territory. 70. A territory's break-even point can be computed in terms of dollars by dividing the _____ with gross profit percentage. A. salesperson's sales revenue B. gross sales C. total sales D. salesperson's fixed costs E. salesperson's total work hours Answer: D Learning Objective: 15-04 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: AnalyticChapter 15 - Time, Territory, and Self-Management: Keys to Success 15-27 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: The break-even point is calculated by dividing the salesperson’s fixed costs by gross profit percentage. 71. Based on the following data, calculate the breakeven point in dollars: Sales = $400,000 Gross Profit = $100,000 Transportation = $8,000 Cost of Goods Sold = $280,000 Expenses = $10,000 Salary = $40,000 A. $96,667 B. $133,333 C. $166,000 D. $232,000 E. Cannot be calculated with the information provided Answer: D Learning Objective: 15-04 Topic: Elements of Time and Territory Management Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: Gross profit percentage = Gross profit/sales = $100,000/$400,000 = 25% BEP = Fixed costs/gross profit % = $58,000/25% = $232,000 72. Based on the following data, calculate the breakeven point. Sales = $500,000 Transportation = $10,000 Gross Profit = $200,000 Lodging and Meals = $8,000 Salary = $37,000 Other expenses = $5,000Chapter 15 - Time, Territory, and Self-Management: Keys to Success 15-28 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. A. $150,000 B. $130,000 C. $100,0003 D. $86,667 E. Cannot be calculated with the information given Answer: A Learning Objective: 15-04 Topic: Elements of Time and Territory Management Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: Gross profit percentage = Gross profit/sales = $200,000/$500,000 = 40% BEP = Fixed costs/gross profit % = $60,000/40% = $150,000 73. Meredith Jacoby sells floral supplies. Her annual sales equal $450,000. Her total fixed costs annually equal $75,000.The cost of goods sold annually is $335,000. Calculate her gross profit percentage. A. 11.9% B. 20.3% C. 25.6% D. 34.3% E. Cannot be determined from information given Answer: C Learning Objective: 15-04 Topic: Elements of Time and Territory Management Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: Gross profit = annual sales – cost of goods sold = $450,000 - $335,000 = $115,000 Gross profit percentage = Gross profit/sales = $115,000/$450,000 = 25.6%Chapter 15 - Time, Territory, and Self-Management: Keys to Success 15-29 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 74. Ryan Hester sells building supplies. His annual sales equal $450,000. His total fixed costs annually equal $75,000. The cost of goods sold annually is $335,000. Ryan’s break-even point in terms of total sales is approximately: A. $198,000 B. $218,600 C. $224,000 D. $293.000 E. $315,200 Answer: D Learning Objective: 15-04 Topic: Elements of Time and Territory Management Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: Gross profit = annual sales – cost of goods sold = $450,000 - $335,000 = $115,000 Gross profit percentage = Gross profit/sales = $115,000/$450,000 = 25.6% BEP = Fixed costs/gross profit % = $75,000/25.6% = $292,968.75 75. Mario Jimenez sells electrical supplies. His annual sales equal $450,000. His total fixed costs annually equal $75,000. The cost of goods sold annually is $335,000. Mario works an average of 240 days a year and 8 hours each day. Mario makes an average of five sales calls per day. Mario’s break-even volume per hour is approximately: A. $119.00 B. $153.00 C. $171.00 D. $256.00 E. $392.00 Answer: B Learning Objective: 15-04 Topic: Elements of Time and Territory Management Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: Gross profit = annual sales – cost of goods sold = $450,000 - $335,000 = $115,000 Gross profit percentage = Gross profit/sales = $115,000/$450,000 = 25.6% BEP = Fixed costs/gross profit % = $75,000/25.6% = $292,968.75 Hours worked per year = 240 x 8 = 1,920 hours Mack’s cost per hour = $75,000/1,920 = $39.06 Break-even volume per hour = cost per hour/gross profit % = $39.06/25.6% = $152.58Chapter 15 - Time, Territory, and Self-Management: Keys to Success 15-30 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 76. Which of the following can be used to calculate the costs and revenues of sales territories? A. ELMS system B. Break-even analysis C. Multivariate territorial analysis D. Keystoning E. SWOT analysis Answer: B Learning Objective: 15-04 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The break-even analysis shows that a sales territory is a cost- and revenuegenerating profit center. Therefore, priorities must be established on account calls to maximize territory profits. 77. According to the suggestions in the text, daily planning by the salesperson would be LEAST likely to include: A. determination of the time to contact the customer. B. analysis of territorial gains and losses. C. selection of the next day's prospects. D. organization of facts and figures. E. preparation of sales presentation materials. Answer: B Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Daily planning starts the night before, as the salesperson selects the next day’s prospects, determines the time to contact the customer, organizes facts and data, and prepares sales presentation materials. Monthly rather than daily planning might include an analysis of territory profits and losses. 78. Which of the following rules should a salesperson adopt in order to have more productive lunch periods? A. Monitor the time to avoid monopolizing too much of the buyer's day. B. Have an alcoholic drink only if the client makes the suggestion. C. Conduct part of the sales presentation during lunch using a laptop. D. When lunching alone, use the time to read something relaxing. E. Offer to purchase the customer a lunchtime cocktail or dessert. Answer: A Learning Objective: 15-02Chapter 15 - Time, Territory, and Self-Management: Keys to Success 15-31 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Topic: Elements of Time and Territory Management Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: During a business lunch, salespeople must keep an eye on the clock and not monopolize too much of the buyer’s time. They should not have a lunchtime cocktail, which may make the salesperson less alert and may be against company policy. A salesperson’s lunch is time to review activities and further plan the afternoon. 79. Which of the following would be a good rule for salespeople to follow in handling their paperwork? A. Avoid paperwork so that more time is available for sales presentations. B. Politely interrupt a sales interview to get paperwork finished. C. Finish paperwork during non-selling times and evenings. D. Manage paperwork on a once-a-month basis. E. Handle paperwork throughout the day. Answer: C Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Effective salespeople do paperwork during nonselling times; evenings are best. Many companies note these records and reports in performance evaluations of salespeople, and the salesperson should keep them current rather than once a month. 80. As a sales rep for Healthtex, Linda plans her activities for the next week; she establishes a fixed day and time to visit each customer's place of business. She is engaged in the process of: A. account grouping. B. routing. C. customer allocation. D. accounts mapping. E. scheduling. Answer: E Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Understand AACSB: AnalyticChapter 15 - Time, Territory, and Self-Management: Keys to Success 15-32 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: Scheduling refers to establishing a fixed time (day and hour) for visiting a customer’s business. Routing is the travel pattern used in working a territory. 81. _____ refers to establishing a fixed time for visiting a customer's business. A. Operational segmentation B. Scheduling C. Customer allocation D. Account grouping E. Routing Answer: B Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Scheduling refers to establishing a fixed time (day and hour) for visiting a customer’s business. Routing is the travel pattern used in working a territory. 82. Establishing a travel pattern to be used in working a territory is called: A. account grouping. B. account time allocation. C. customer sales planning. D. routing. E. scheduling. Answer: D Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Routing is the travel pattern used in working a territory. Scheduling refers to establishing a fixed time (day and hour) for visiting a customer’s business. 83. Companies most likely give their salespeople strict formal route plans in order to: A. increase the flexibility of operations. B. improve territory coverage. C. promote the individual's planning experience. D. minimize the size of each territory. E. ensure that salespeople use the straight-line routing pattern. Answer: B Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: AnalyticChapter 15 - Time, Territory, and Self-Management: Keys to Success 15-33 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: Strict formal route designs enable the company to improve territory coverage; minimize wasted time; and establish communication between management and the sales force in terms of the location and activities of individual salespeople. 84. Which of the following statements about routing reports is true? A. A routing report is usually filed monthly and submitted to the manager. B. Companies usually require route reports even if no overnight travel is involved. C. Salespeople are seldom asked to specify times and accounts on routing reports. D. Routing reports allow sales managers to know where salespeople are located. E. Most companies allow very little latitude for salespeople in routing. Answer: D Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Routing reports, which are filed weekly, help a manager keep track of a salesperson. If no overnight travel is necessary to cover a territory, the company may not require any route reports because the salesperson can be contacted at home in the evening. 85. The most critical factor to be considered when setting up a sales route is: A. number of miles traveled. B. traffic signals in the route. C. fuel consumption. D. sales experience. E. travel time. Answer: E Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The critical factor is travel time—not miles. In some cases, by using major nonstop highways, your miles may increase but your total travel time may decrease.Chapter 15 - Time, Territory, and Self-Management: Keys to Success 15-34 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 86. Michael delivers pesticides to farmers' cooperatives. When planning his daily routing pattern, Michael prefers to start with the customers who are at the far end of the territory and work his way back to his company's office. Which routing pattern would most likely allow Michael to do this? A. Rectangular pattern B. Straight-line pattern C. Leapfrog pattern D. Major-city pattern E. Perpendicular pattern Answer: B Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The straight-line method involves starting with the customer at the greatest distance from the office or home and working backwards so that the finishing point is the office or home. 87. Which of the following statements about using the telephone for territory coverage is most likely TRUE? A. The telephone is inappropriate for handling complaints. B. Prospecting over the telephone is ineffective and time consuming. C. Large accounts should primarily be handled and serviced by telephone. D. Phone calls can replace some personal visits to geographically distant accounts. E. Telephone sales have replaced personal selling efforts because of time and cost savings. Answer: D Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Understand AACSB: Communication Level of Difficulty: Medium Explanation: Telephone calls are useful for addressing complaints, prospecting, and handling distant customers. More companies are developing telephone sales and marketing campaigns to supplement personal selling efforts but not replace personal selling.Chapter 15 - Time, Territory, and Self-Management: Keys to Success 15-35 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 88. Territorial evaluation is the establishment of _____ for the individual territory in the form of qualitative and quantitative quotas or goals. A. ELMS standards B. break-even point C. time limits D. key accounts E. performance standards Answer: E Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Territorial evaluation is the establishment of performance standards for the individual territory in the form of qualitative and quantitative quotas or goals. Actual performance is compared to these goals for evaluation purposes. 89. During a(n) salesperson’s ____, the salesperson’s actual performance is compared with the preset performance standards for the sales territory. A. territorial evaluation B. MBO review C. break-even analysis D. ELMS review E. market audit Answer: A Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Territorial evaluation is the establishment of performance standards for the individual territory in the form of qualitative and quantitative quotas or goals. Actual performance is compared to these goals for evaluation purposes. 90. Which of the following statements is most likely true about territorial evaluation? A. In territorial evaluation, actual performance is evaluated separately from goals. B. Territorial evaluation monitors the time interval between multiple sales calls. C. Qualitative quotas and performance are not considered in territorial evaluation. D. Territorial evaluation establishes performance standards in the form of quotas or goals. E. During the evaluation, managers reports are considered instead of individual salespeople's reports. Answer: D Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: RememberChapter 15 - Time, Territory, and Self-Management: Keys to Success 15-36 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Easy Explanation: Territorial evaluation is the establishment of performance standards for the individual territory in the form of qualitative and quantitative quotas or goals. Actual performance is compared to these goals for evaluation purposes. Essay Questions 91. What is a sales territory? What are the major reasons for forming sales territories? Answer: A sales territory comprises a group of customers or a geographic area assigned to a salesperson. The territory may or may not have geographic boundaries. Typically, however, a salesperson is assigned to a geographic area containing present and potential customers. Companies develop sales territories for the following reasons. (1) For obtaining thorough coverage of the market. (2) For establishing each salesperson's responsibilities. (3) For evaluating the performance of salespeople. (4) For improving customer relations. (5) For reducing sales expense. (6) For allowing better matching of salesperson to customer's needs. Learning Objective: 15-01 Topic: Customers Form Sales Territories Blooms: Analyze AACSB: Analytic Level of Difficulty: Hard 92. Why is the development of sales territories inefficient for some companies? Answer: Some companies choose not to develop sales territories because: (1) Salespeople may be more motivated if they are not restricted by a particular territory. (2) The company may be too small to be concerned with segmenting the market into sales territories. (3) Management may not want to take the time or have the know-how for territory development. (4) Personal friendships may be the bases for attracting customers. Learning Objective: 15-01 Topic: Customers Form Sales Territories Blooms: Analyze AACSB: AnalyticChapter 15 - Time, Territory, and Self-Management: Keys to Success 15-37 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Hard 93. List and explain the two general approaches to account analysis. Answer: The two general approaches to account analysis are: (1) Undifferentiated selling approach and (2) account segmentation approach. The undifferentiated selling approach is used when an organization sees that the accounts in its market are similar. Here selling strategies are designed and applied equally to all accounts. The account segmentation approach is used when salespeople recognize that their territories contain accounts with heterogeneous needs and differing characteristics that require different selling strategies. Here sales objectives are developed based on overall sales and sales for each product for each product and prospect. Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 94. What is the relationship between the ELMS system and the 80/20 principle? Answer: The ELMS system defines accounts in terms of extra large, large, medium, and small. The 80/20 principle explains that these extra large accounts typically represent 80 percent of a company's profitable sales and only 20 percent of total accounts. Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Analyze AACSB: Analytic Level of Difficulty: Hard 95. Explain multivariable account segmentation. Answer: Multivariable account segmentation means using more than one criterion to characterize the organization's accounts. Sales organizations use segmentation because they sell to several markets and use many channel members in these markets. The emphasis can be given to different products, product sizes, or product lines to different channel members in various markets. Learning Objective: 15-03 Topic: Elements of Time and Territory Management Blooms: Understand AACSB: AnalyticChapter 15 - Time, Territory, and Self-Management: Keys to Success 15-38 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium 96. What are the basic factors a salesperson must consider when allocating time within territories? Answer: Some of the basic factors a salesperson must consider while allocating time within territories are: (1) Number of accounts in the territory, (2) number of sales calls made on a customer, (3) time required for each sales call, (4) frequency of customer sales calls, (5) travel time around the territory, (6) non-selling time, and (7) return on time invested. Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 97. Lawrence sells lockers like those found in airports, bus stations, exercise centers, and schools. His fixed selling costs are $25,000 annually. His annual sales are $350,000 and the annual cost of the lockers he sells equals $215,000. Calculate his gross profit in percentage and his break-even point. Answer: His gross profit in percentage is ($350,000 - $215,000)/$350,000 = 38.57 percent. His break-even equals $25,000/0.3857 = $64817.21 Learning Objective: 15-04 Topic: Elements of Time and Territory Management Blooms: Apply AACSB: Analytic Level of Difficulty: Hard 98. How can a salesperson use break-even analysis as a time management tool? Answer: Break-even analysis is a quantitative technique for determining the level of sales at which total revenues equal total costs. Salespeople can use break-even analysis to determine how much sales volume a salesperson must generate in terms of territories and in terms of hours to meet costs in a territory. Learning Objective: 15-04 Topic: Elements of Time and Territory Management Blooms: Apply AACSB: Analytic Level of Difficulty: Hard 99. What commonly causes the frequency of sales calls made by a salesperson to increase? Answer: The following things generally cause an increase in the frequency of calls made by the salesperson. (1) An increase in sales and/or potential sales, (2) an increase in number of orders placed in a year, (3) an increase in number of product lines sold, and (4) an increase in complexity, servicing, and redesigning requirements of product. Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: UnderstandChapter 15 - Time, Territory, and Self-Management: Keys to Success 15-39 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Medium 100. Ruth sells bathroom fixtures. She believes that if she can get a customer she is calling on to go out to lunch with her, she will close the sale. What do you think about Ruth's assumption? Answer: Salespeople often take people to lunch. However, study results show that the business lunch does not lead directly to a sale, but to the buyer and seller can know each other better, which builds confidence and trust. This may lead to sales in the long run. Learning Objective: 15-02 Topic: Elements of Time and Territory Management Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 16 - Planning, Staffing, and Training Successful Salespeople 16-1 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Chapter 16 Planning, Staffing, and Training Successful Salespeople Learning Objectives: 16-01 Discuss the relationship between a firm‟s marketing plan, sales force, and the sales force‟s budget. 16-02 Describe the organization of a sales force. 06-03 Explain the two major elements involved in staffing the sales force—personnel planning and employment planning. 16-04 Discuss what is involved in training the sales force. True / False Questions 1. Most sales managers focus on completing assigned tasks in an attempt to earn large commissions, but most salespeople focus on long-term objectives and organizational goals. Answer: False Learning Objective: 16-01 Topic: Transition from Salesperson to Sales Manager Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Most salespeople are largely concerned with doing a good job at their assigned tasks and planning how to get ahead. Managers, however, must keep the big picture in mind. They make plans and decisions by considering their impact on the goals and well-being of the group (sales district) and the organization as a whole. 2. The move from salesperson to manager involves several predictable stages, including mobilization, which is when they feel motivated to move more quickly than is sometimes good for them and the company. Answer: False Learning Objective: 16-01 Topic: Transition from Salesperson to Sales Manager Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Immobilization is the first phase of moving from salesperson to manager. In this phase, the person feels overwhelmed by the changes he or she is facing. 3. Steven Howard feels overwhelmed by his new job as a district sales manager. This is the first stage of transformation for someone who has just been promoted from salesperson to sales manager. Answer: True Learning Objective: 16-01 Topic: Transition from Salesperson to Sales Manager Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 16 - Planning, Staffing, and Training Successful Salespeople 16-2 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Steven is experiencing immobilization, the first phase of moving from salesperson to manager. In this phase, the person feels overwhelmed by the changes he or she is facing. 4. During the „searching for meanings' stage in the transformational process to managerial job, the person's concern shifts to trying to understand both how and why things are different now. Answer: True Learning Objective: 16-01 Topic: Transition from Salesperson to Sales Manager Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The sixth phase of transitioning from salesperson to manager involves searching for meanings. The person‟s concern shifts to trying to understand both how and why things are different now. 5. A new manager will be heavily supported by his subordinates and other managers to make the initial adjustments to his new role. Answer: False Learning Objective: 16-01 Topic: Transition from Salesperson to Sales Manager Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Companies generally expect new managers to step into the job and function effectively and immediately. This expectation exists even though many organizations offer them little help or support. 6. A manager's salary is usually related to the number of salespeople being supervised. Answer: True Learning Objective: 16-01 Topic: What Is the Salary for Management? Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A sales manager‟s salary is usually related to the following: annual sales volume of units managed and the number of salespeople supervised. 7. The attainment of sales force goals in an effective manner is called sales management. Answer: True Learning Objective: 16-02 Topic: Overview of the Job Blooms: Remember AACSB: AnalyticChapter 16 - Planning, Staffing, and Training Successful Salespeople 16-3 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: Sales management is the attainment of sales force goals in an effective and efficient manner through planning, staffing, training, directing, and evaluating organizational resources. 8. The management function of directing is concerned with establishing a broad outline of goals; policies; and procedures that will result in accomplishing the firm's objectives. Answer: False Learning Objective: 16-02 Topic: Sales Management Functions Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Directing involves dealing with people positively and persuasively from a leadership position regarding motivation and compensation. Planning involves establishing a broad outline for goals, policies, and procedures that will accomplish the objectives of the organization. 9. First-line managers spend less time directing the performance of the sales force than higher-level managers. Answer: False Learning Objective: 16-02 Topic: Sales Management Functions Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: First-line managers, such as district sales managers who hire salespeople, spend more time directing salespeople than higher level managers. In comparison, top level sales managers spend more time planning and organizing. 10. Typically, sales goals are set slightly lower than sales forecasts. Answer: False Learning Objective: 16-02 Topic: Sales Force Planning Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Typically, sales goals are slightly higher than sales forecasts. Once plans have evolved into sales forecasts, the company develops its sales budgets.Chapter 16 - Planning, Staffing, and Training Successful Salespeople 16-4 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 11. The sales force budget is the amount of money available or assigned to a sales manager for a period of time, usually one month. Answer: False Learning Objective: 16-01 Topic: Sales Force Planning Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The sales force budget is the amount of money available or assigned for a definite period, usually one year. It is based on estimates of expenditures during that time and proposals for financing the budget. 12. Organizational design is the formal, coordinated process of communication, authority, and responsibility for sales groups and individuals. Answer: True Learning Objective: 16-02 Topic: Sales Force Planning Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Organizational design refers to the formal, coordinated process of communication, authority, and responsibility for sales groups and individuals. An effectively designed sales organization is one in which its framework enables the organization to serve its customers. 13. Organizational structure refers to the varying relationships among jobs within the organization. Answer: False Learning Objective: 16-02 Topic: Sales Force Planning Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Organizational structure is the relatively fixed, formally defined relationship among jobs within the organization. Structure is reflected in a company‟s organizational chart.Chapter 16 - Planning, Staffing, and Training Successful Salespeople 16-5 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 14. Sales force staffing is the process of matching the right people to the right jobs and placing them in the right sales territory. Answer: True Learning Objective: 16-03 Topic: Staffing: Having the Right People to Sell Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Staffing refers to activities undertaken to attract, hire, and maintain effective sales force personnel within an organization. The staffing process involves determining how many people to hire, whom to hire, selection—matching these people to the right sales jobs— and placing them in the right sales territory. 15. Job specifications are formal, written statements describing the nature, requirements, and responsibilities of a specific sales position. Answer: False Learning Objective: 16-03 Topic: Staffing: Having the Right People to Sell Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Job descriptions are formal, written statements describing the nature, requirements, and responsibilities of a specific sales position. Job specifications convert job descriptions into the people qualifications the organization feels are necessary for successful job performance. 16. Job descriptions include education, specific aptitudes, personality type, and experience that the organization feels are necessary for successful job performance. Answer: False Learning Objective: 16-03 Topic: Staffing: Having the Right People to Sell Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Job specifications identify the people qualifications (e.g., abilities, behavior, education, and skills) the organization feels are necessary for successful job performance. Job descriptions are formal, written statements describing the nature, requirements, and responsibilities of a specific sales position.Chapter 16 - Planning, Staffing, and Training Successful Salespeople 16-6 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 17. Employment planning refers to the allocation of sales staff to various territories and districts. Answer: False Learning Objective: 16-03 Topic: Staffing: Having the Right People to Sell Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Employment planning refers to the recruitment and selection of applicants for sales jobs. 18. Multicultural organizations typically suffer from higher levels of prejudice, discrimination, and intergroup conflict than organizations that follow cultural consistency. Answer: False Learning Objective: 16-03 Topic: Staffing: Having the Right People to Sell Blooms: Remember AACSB: Diversity Level of Difficulty: Easy Explanation: Multicultural organizations fully integrate gender, racial, and minority group members both formally and informally. The multicultural organization is marked by an absence of prejudice and discrimination and by low levels of intergroup conflict. 19. College recruiting is an expensive process but a major source of high-quality applicants. Answer: True Learning Objective: 16-03 Topic: Staffing: Having the Right People to Sell Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: College recruiting, although an expensive process, is a major source of highquality applicants. Many companies work hard to get top students into their interviews. 20. Caring, joy, harmony, patience, kindness, moral ethics, faithful, fair, and self-controlled are the nine characteristics of a Golden Rule salesperson. Answer: True Learning Objective: 16-01 Topic: The Golden Rule: Management Blooms: Remember AACSB: Ethics Level of Difficulty: EasyChapter 16 - Planning, Staffing, and Training Successful Salespeople 16-7 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: The manager who cares, likes people, is good to work with, and is patient, kind, and morally ethical is certainly someone who will be faithful in taking care of salespeople and customers. This leader will be fair to all, treating them according to what is the right thing to do. Finally, the leader must be able to control emotions, passions, and desires when leading people to higher sales levels. These nine characteristics comprise the Golden Rule of Sales Management of unselfishly treating salespeople as you would like to be treated; placing their interest first. 21. Physical tests and reference checks are examples of employee selection tools. Answer: True Learning Objective: 16-03 Topic: Staffing: Having the Right People to Sell Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Employment references and physical examinations are two additional steps used to gather information on an applicant. Reference checks and exams are considered selection tools. 22. The letter of application should be based on the sound psychological principle of reinforcement, that is, it should contain most of the information presented in the resume without providing any additional information. Answer: False Learning Objective: 16-03 Topic: Staffing: Having the Right People to Sell Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The application letter introduces the applicant to the prospective employer. It should not totally rehash the information in the résumé. 23. If the recruiter has set a time for notifying the applicant of a decision and if that time has passed, a follow-up letter or call is appropriate. Answer: True Learning Objective: 16-03 Topic: Staffing: Having the Right People to Sell Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A letter immediately following the interview is not always necessary. However, if the recruiter has set a time for notifying the applicant of a decision and if that time has passed, a follow-up letter or call is appropriate.Chapter 16 - Planning, Staffing, and Training Successful Salespeople 16-8 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 24. Even the most successful salespeople are not exempted from sales training. Answer: True Learning Objective: 16-04 Topic: Training the Sales Force Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Successful companies thoroughly train new salespeople and have ongoing training programs for experienced sales personnel, in which even the most successful salespeople participate. Basically, sales training changes or reinforces behavior to make salespeople more efficient in achieving job goals. 25. Discussion, role playing, and on-the-job training are the three primary training methods. Answer: True Learning Objective: 16-04 Topic: Training the Sales Force Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The three basic training methods are discussion, role playing, and on-the-job training. 26. Role-playing typically involves analyzing a sales situation rather than acting out selling situations. Answer: False Learning Objective: 16-04 Topic: Training the Sales Force Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: In role playing, the trainee acts out the sale of a product or service to a hypothetical buyer. Often the trainee‟s presentation is videotaped and replayed for critique by a group, the trainee, and the trainer. 27. After defining a sales problem during a role-playing activity, a sales trainee is asked to establish the situation by describing the largest potential account and its buyer. Answer: True Learning Objective: 16-04 Topic: Training the Sales Force Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 16 - Planning, Staffing, and Training Successful Salespeople 16-9 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: In a role-playing exercise, the first step is to define the sales problem. Next, the trainee establishes the situation by thinking about, and then describing, the largest potential account and its buyer. 28. Salespeople from all geographical areas served by the company can participate in centralized training. Answer: True Learning Objective: 16-04 Topic: Training the Sales Force Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Training at a central location is primarily intended for instruction of salespeople from all geographical areas served by the company. Programs typically are held at or close to the home office/manufacturing plant, in a large city, or at a resort. Centralized training programs supplement the basic training done by sales personnel in the field. 29. On-the-job training includes observation and curbside counseling by the sales manager. Thus, the salesperson gets immediate feedback. Answer: True Learning Objective: 16-04 Topic: Training the Sales Force Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: On-the-job training includes observation and curbside counseling by the sales manager. This way, the salesperson gets immediate feedback. When the manager and salesperson leave the customer‟s office, the manager can critique the sales presentation. 30. A major weakness of decentralized training is that the costs associated with it are extremely high. Answer: False Learning Objective: 16-04 Topic: Training the Sales Force Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: There are numerous advantages to decentralized training. For one thing, costs are usually lower. For example, if a branch office is used as the training site, travel costs are less. The sessions are typically shorter, saving on motel and meal expenditures.Chapter 16 - Planning, Staffing, and Training Successful Salespeople 16-10 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 31. Centralized training programs usually involve low-quality facilities and dated equipment, which is why they are infrequently used by sales organizations. Answer: False Learning Objective: 16-04 Topic: Training the Sales Force Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Centralized training programs usually involve excellent facilities and equipment, such as classrooms, videotapes, closed circuit television, and sales laboratories designed for role playing. 32. The duties of a sales training manager rarely include organization, coordination, or scheduling of the training. Answer: False Learning Objective: 16-04 Topic: Training the Sales Force Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: One of the duties of a training manager is to organize, coordinate, and schedule the training of employees. 33. Senior sales representatives and regional sales managers are the primary trainers of the sales force. Answer: True Learning Objective: 16-04 Topic: Training the Sales Force Training the Sales Force Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Senior sales representatives and district and regional sales managers are the primary trainers of the sales force. These people bring to the training program years of sales experience that help the trainee relate quickly to the instructor and the material.Chapter 16 - Planning, Staffing, and Training Successful Salespeople 16-11 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 34. A company should choose a senior salesperson as a trainer on the basis of sales ability and effective teaching skills. Answer: True Learning Objective: 16-04 Topic: Training the Sales Force Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A company should choose a senior salesperson as a trainer not only on the basis of sales ability but also because of effective teaching skills. People with both sales and teaching abilities can usually be found, but management must seek them out. 35. Small firms rarely use outside sales trainers because it is more cost effective for them to maintain an internal training staff. Answer: False Learning Objective: 16-04 Topic: Training the Sales Force Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Smaller firms may rely heavily on outside trainers. This practice affords them the training without the cost of maintaining a training staff. Multiple Choice Questions 36. Which of the following statements is most likely true about the changes that occur when a person is promoted from a salesperson to a manager? A. The time spent on actual sales and customer work increases dramatically. B. The salesperson's primary concern becomes meeting the organization's goals. C. Personal satisfaction comes from the work rather than watching others succeed. D. Developing additional technical skills for complex accounts becomes time consuming. E. Attracting global accounts and developing greater proficiency in selling are new tasks. Answer: B Learning Objective: 16-01 Topic: Transition from Salesperson to Sales Manager Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 16 - Planning, Staffing, and Training Successful Salespeople 16-12 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Most salespeople are largely concerned with doing a good job at their assigned tasks and planning how to get ahead. Managers, however, must keep the big picture in mind. They make plans and decisions by considering their impact on the goals and well-being of the group (sales district) and the organization as a whole. 37. One of Hillcrest Manufacturing Company's most successful salespersons was promoted to a sales management position three weeks ago, and he is still feeling overwhelmed by all the changes he is facing. This new manager is experiencing which stage of the transition from subordinate to boss? A. Immobilization B. Incompetence C. Denial D. Depression E. Searching for meanings Answer: A Learning Objective: 16-01 Topic: Transition from Salesperson to Sales Manager Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Immobilization occurs when the person feels overwhelmed by the changes he or she is facing. 38. A successful salesperson was recently promoted to a sales management position, and she is becoming painfully aware of the magnitude of the changes she must make in her habits, customs, and relationships. What stage of the transition from subordinate to boss is she experiencing? A. Immobilization B. Depression C. Acceptance of reality D. Minimizing change E. Searching for meanings Answer: B Learning Objective: 16-01 Topic: Transition from Salesperson to Sales Manager Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Depression is the third phase of transition. Awareness sets in regarding the magnitude of the changes that must be made in one‟s habits, customs, and relationships.Chapter 16 - Planning, Staffing, and Training Successful Salespeople 16-13 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 39. A person promoted from a selling position to a sales management position goes through a series of phases, the first of which is: A. denial of change. B. testing behaviors. C. evaluation. D. searching for meanings. E. immobilization. Answer: E Learning Objective: 16-01 Topic: Transition from Salesperson to Sales Manager Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Immobilization occurs when the person feels overwhelmed by the changes he or she is facing. It is the first phase of being promoted. 40. When a salesperson is promoted to sales manager, that individual goes through the transition from thinking and acting like a subordinate to thinking and acting like a supervisor. Which of the following is one of the phases involved in that transition? A. Incompetence B. Defiance C. Depression D. Inquisition E. Externalization Answer: C Learning Objective: 16-01 Topic: Transition from Salesperson to Sales Manager Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The seven phases of transition are immobilization, minimizing, depression, acceptance of reality, testing, searching for meaning, and internalization.Chapter 16 - Planning, Staffing, and Training Successful Salespeople 16-14 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 41. All of the following are characteristics of the Golden Rule of Sales Management EXCEPT: A. kindness B. patience C. collaboration D. self-control E. fairness Answer: C Learning Objective: 16-01 Topic: The Golden Rule: Management Blooms: Remember AACSB: Ethics Level of Difficulty: Easy Explanation: Nine characteristics comprise the Golden Rule of Sales Management of unselfishly treating salespeople as you would like to be treated. These qualities include caring, joy, harmony, patience, kindness, moral ethics, faithfulness, fairness, and self-control. 42. A newly appointed sales manager goes through a series of phases in learning to think and act like a boss. The last phase in such a process is called: A. image reversal. B. search for meanings. C. mobilization. D. internalization. E. reciprocity. Answer: D Learning Objective: 16-01 Topic: Transition from Salesperson to Sales Manager Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Internalization is the final phase. At this stage, the person incorporates the new meanings into his or her behavior 43. Which of the following is a major problem commonly experienced by salespeople who are promoted to management positions? A. Lack of sales knowledge B. Too much peer support C. Lack of enthusiasm D. Conflicts due to sales knowledge E. Expectation to perform immediately Answer: E Learning Objective: 16-01 Topic: Transition from Salesperson to Sales Manager Blooms: Understand AACSB: AnalyticChapter 16 - Planning, Staffing, and Training Successful Salespeople 16-15 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: Companies generally expect new managers to step into the job and function effectively and immediately. This expectation exists even though many organizations offer them little help or support. 44. A sales manager who has a learning attitude: A. seeks help when needed. B. engages in autonomous supervision. C. expects subordinates to make mistakes. D. engages in limited sales training programs. E. has highly optimistic expectations of employees. Answer: A Learning Objective: 16-01 Topic: Transition from Salesperson to Sales Manager Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: One key to making a successful transition into management is for the new manager to have a learning attitude: being willing to learn, change, adapt, and seek help when needed. Managers with this attitude find the going much smoother than those who expect things to remain relatively unchanged. 45. _____ refers to efficiently and effectively reaching sales force goals by planning, staffing, training, directing, and evaluating organizational resources. A. Performance optimization B. Sales management C. Sales forecasting D. Resource mobilization E. Sales training Answer: B Learning Objective: 16-02 Topic: Overview of the Job Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Sales management is the attainment of sales force goals in an effective and efficient manner through planning, staffing, training, directing, and evaluating organizational resources. Sales managers work with and through individuals and groups in the company, in the sales force, and outside the firm to accomplish their goals.Chapter 16 - Planning, Staffing, and Training Successful Salespeople 16-16 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 46. Which of the following is the main goal of a sales manager? A. Achieving desired level of sales volume, profits, and growth B. Engaging in long-term strategic demand forecasting C. Recruiting the best people available for sales jobs D. Developing job descriptions for filling positions E. Identifying high-volume sales organizations Answer: A Learning Objective: 16-02 Topic: Overview of the Job Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The sales manager‟s main goal is to achieve the levels of sales volume, profits, and sales growth desired by higher levels of management. The factor underlying a manager‟s success in achieving this goal is the ability to influence the behavior of all parties involved. 47. _____ is defined as the management function of establishing a broad outline for goals, policies, and procedures that will accomplish the objectives of the organization. A. Planning B. Evaluating C. Training D. Directing E. Staffing Answer: A Learning Objective: 16-03 Topic: Sales Management Functions Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Planning refers to establishing a broad outline for goals, policies, and procedures that will accomplish the objectives of the organization. This function includes forecasting, developing budgets, and establishing the organizational design and structure.Chapter 16 - Planning, Staffing, and Training Successful Salespeople 16-17 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 48. Which sales manager function involves dealing positively and persuasively with people from a leadership position? A. Training B. Organizing C. Staffing D. Directing E. Evaluating Answer: D Learning Objective: 16-03 Topic: Sales Management Functions Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Directing is the management function that involves dealing with people positively and persuasively from a leadership position regarding motivation and compensation. 49. Which of the following is defined as comparing actual performance to planned performance and determining whether corrective action is needed? A. Training B. Organizing C. Performance forecast D. Directing E. Evaluating Answer: E Learning Objective: 16-03 Topic: Sales Management Functions Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Evaluating is the management function that involves comparing actual performance to planned performance goals. Evaluation helps determine whether to take corrective action if goals are not achieved, or to continue using the same methods if goals are met.Chapter 16 - Planning, Staffing, and Training Successful Salespeople 16-18 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 50. Which of the following helps predict a firm's future revenues when planning the company's marketing and sales force activities? A. Employee appraisal B. Organizational design C. HR optimization D. Sales force optimization E. Sales forecasting Answer: E Learning Objective: 16-03 Topic: Sales Force Planning Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Sales forecasting is one method used to predict a firm‟s future revenues when planning the company‟s marketing and sales force activities. Since customer satisfaction is the purpose of every business, the forecast of customer needs is of primary importance. Forecasting is an integral part of planning that contributes to overall organizational effectiveness. 51. The sales force budget is most likely based on estimates of: A. industry sales. B. sales forecasts. C. long-term staffing needs. D. training costs and functions. E. labor market supply expectations. Answer: B Learning Objective: 16-01 Topic: Sales Force Planning Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The sales force budget is the amount of money available or assigned for a definite period, usually one year. It is based on estimates of expenditures during that time and proposals for financing the budget. Thus, the budget depends on the sales forecast and the amount of revenue expected to be generated for the organization during that period. 52. Which statement about sales force budgeting is most likely true? A. The sales force budget is the amount of money available for an unspecified time period. B. Portions of the overall sales force budget may be reassigned to lower level managers. C. Sales force budgets are typically set for one month periods to allow flexibility. D. Revenue projections have no influence on sales force budgets. E. Companies should base budgets on subjective judgments. Answer: B Learning Objective: 16-01 Topic: Sales Force PlanningChapter 16 - Planning, Staffing, and Training Successful Salespeople 16-19 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The budget for the sales force is a valuable resource that the sales manager reassigns among lower level managers. The sales force budget is the amount of money available for a definite period, usually one year. It is based on objective estimates of expenditures during that time and proposals for financing the budget. 53. Which of the following would most likely be considered an operating cost for a sales force when determining a sales budget? A. Variable production costs B. Advertising costs C. Product samples D. Development fees E. Product distribution costs Answer: C Learning Objective: 16-01 Topic: Sales Force Planning Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Product samples, selling aids, travel, and compensation are operating costs. 54. _____ refers to the formal, coordinated process of communication, authority, and responsibility for sales groups and individuals. A. Functional organization B. Organizational acculturation C. Formal organization D. Organizational design E. Organizational structure Answer: D Learning Objective: 16-02 Topic: Sales Force Planning Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Organizational design refers to the formal, coordinated process of communication, authority, and responsibility for sales groups and individuals. An effectively designed sales organization is one in which its framework enables the organization to serve its customers.Chapter 16 - Planning, Staffing, and Training Successful Salespeople 16-20 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 55. Organizational design refers to the: A. company's organizational chart. B. type of organizational culture selected by a company. C. flexibly defined relationships among jobs within an organization. D. authority for staffing, directing, training, and evaluating subordinates. E. coordinated process of communication, authority, and responsibility for sales groups. Answer: E Learning Objective: 16-02 Topic: Sales Force Planning Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Organizational design refers to the formal, coordinated process of communication, authority, and responsibility for sales groups and individuals. An effectively designed sales organization is one in which its framework enables the organization to serve its customers. 56. A company's structure is reflected in its: A. routing map. B. PERT chart. C. organizational chart. D. structural inventory. E. SWOT matrix. Answer: C Learning Objective: 16-02 Topic: Sales Force Planning Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Organizational structure is the relatively fixed, formally defined relationship among jobs within the organization. Structure is reflected in a company‟s organizational chart. Many companies organize on the basis of some combination of function, geography, product, or customer design.Chapter 16 - Planning, Staffing, and Training Successful Salespeople 16-21 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 57. The relatively fixed, formally defined relationship among jobs within an organization is called its organizational: A. evaluation. B. function. C. description. D. design. E. structure. Answer: E Learning Objective: 16-02 Topic: Sales Force Planning Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Organizational structure is the relatively fixed, formally defined relationship among jobs within the organization. Structure is reflected in a company‟s organizational chart. Many companies organize on the basis of some combination of function, geography, product, or customer design. 58. A manager who is participating in a college job fair to locate potential applicants for his company's entry-level sales positions is engaged in: A. job forecasting. B. job analysis. C. directing. D. staffing. E. organizational design. Answer: D Learning Objective: 16-03 Topic: Staffing: Having the Right People to Sell Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Staffing refers to activities undertaken to attract, hire, and maintain effective sales force personnel within an organization. Staffing may occur at a job fair on a college campus. 59. The most important ingredient in developing a successful sales force is having: A. the right people. B. a sizeable budget. C. a vertical organizational structure. D. a massive advertising campaign. E. a premium product to sell. Answer: A Learning Objective: 16-03 Topic: Staffing: Having the Right People to Sell Blooms: Remember AACSB: AnalyticChapter 16 - Planning, Staffing, and Training Successful Salespeople 16-22 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: People are the most important ingredient in developing a successful sales force. 60. _____ is the definition of a sales position in terms of specific roles or activities to be performed, and the determination of the personal qualifications suitable for the job. A. Job forecast B. Task alteration C. Job formulation D. Job analysis E. Job reengineering Answer: D Learning Objective: 16-04 Topic: Staffing: Having the Right People to Sell Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A job analysis is the definition of a sales position in terms of specific roles or activities to be performed, and the determination of personal qualifications suitable for the job. 61. Which of the following typically links salespeople to the rest of the company? A. HR manager B. Regional sales manager C. District manager D. Technical manager E. National sales manager Answer: C Learning Objective: 16-02 Topic: Being a First-Line Sales Manager Is a Challenging Job Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The district sales manager is the link between the salespeople and the manager‟s immediate boss—the regional sales manager. Thus, to be effective in the job, the district manager must be effective in managing salespeople and influencing the boss. 62. Which of the following is a formal, written statement describing the nature, requirements, and responsibilities of a specific sales position? A. Job evaluation B. Job design C. Job rotation D. Job specification E. Job description Answer: E Learning Objective: 16-03Chapter 16 - Planning, Staffing, and Training Successful Salespeople 16-23 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Topic: Staffing: Having the Right People to Sell Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Job descriptions are formal, written statements describing the nature, requirements, and responsibilities (e.g., sales volume, territory, product line, customers, and supervisory duties) of a specific sales position. They officially establish what the salesperson will do, how it will be done, and why these duties are important, as well as indicate the salary range for the position. 63. The sales manager for Humphrey Electronics is preparing a written statement that describes what a salesperson is expected to do, how he/she will do it, why these duties are important, and the salary range for the position. The document the manager is working on is called a job: A. analysis. B. description. C. evaluation. D. posting. E. metric. Answer: B Learning Objective: 16-03 Topic: Staffing: Having the Right People to Sell Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Job descriptions are formal, written statements describing the nature, requirements, and responsibilities (e.g., sales volume, territory, product line, customers, and supervisory duties) of a specific sales position. They officially establish what the salesperson will do, how it will be done, and why these duties are important, as well as indicate the salary range for the position. 64. _____ converts the job description into the people qualifications the organization feels are necessary for successful performance of the job. A. Strategic HR plan B. Job design C. Job rotation D. Job specification E. Job regulation Answer: D Learning Objective: 16-03 Topic: Staffing: Having the Right People to Sell Blooms: Remember AACSB: Analytic Level of Difficulty: EasyChapter 16 - Planning, Staffing, and Training Successful Salespeople 16-24 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Job specifications convert job descriptions into the people qualifications (e.g., abilities, behavior, education, and skills) the organization feels are necessary for successful job performance. 65. The first step in the breakdown approach of determining appropriate sales force size is to: A. determine the size of sales territories. B. determine the number of sales territories. C. forecast sales and determine sales potentials. D. determine organizational sales volume. E. forecast sales volume for each key account. Answer: C Learning Objective: 16-03 Topic: Staffing: Having the Right People to Sell Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Forecasting sales and determining sales potentials are the tasks involved in the first step of the breakdown approach. The firm forecasts sales for its total market and each geographic region. Sales potentials also are considered. 66. Which of the following is identified as a characteristic of a successful salesperson? A. Passive B. Reactive C. Compliant D. Energetic E. Cautious Answer: D Learning Objective: 16-03 Topic: Staffing: Having the Right People to Sell Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A successful salesperson should be energetic, likable, hard-working, and competitive. 67. _____ is defined as the recruitment and selection of applicants for sales jobs. A. Employment planning B. Motivational directing C. Sales forecasting D. Corporate leading E. People planning Answer: A Learning Objective: 16-03 Topic: Staffing: Having the Right People to Sell Blooms: RememberChapter 16 - Planning, Staffing, and Training Successful Salespeople 16-25 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Easy Explanation: Employment planning refers to the recruitment and selection of applicants for sales jobs. Recruitment begins with the initiation of a search 68. Which government agency has the greatest influence on sales force staffing? A. EEOC B. ADA C. DOL D. BBB E. BLS Answer: A Learning Objective: 16-03 Topic: Staffing: Having the Right People to Sell Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Although a number of federal agencies are involved, the Equal Employment Opportunity Commission (EEOC) is the principal government agency responsible for monitoring discriminatory practices. As such, the EEOC has a major influence on sales force staffing. 69. What do the EEOC and the ADA have in common? A. Both are established to eliminate gender discrimination outside work premises. B. Both are responsible for eliminating discriminatory practices at work. C. Both make sure organizations hire adequate numbers of people. D. Neither has the real authority to curb recruitment violations. E. Both are responsible for reducing unemployment. Answer: B Learning Objective: 16-03 Topic: Staffing: Having the Right People to Sell Blooms: Analyze AACSB: Analytic Level of Difficulty: Hard Explanation: The Equal Employment Opportunity Commission (EEOC) is the principal government agency responsible for monitoring discriminatory practices. A law influencing sales hiring is the Americans with Disabilities Act (ADA), which defines a disability as a physical or mental impairment that substantially limits one or more major life activities.Chapter 16 - Planning, Staffing, and Training Successful Salespeople 16-26 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 70. A court would most likely rule in favor of an employer charged with employment discrimination if the employment decision was based on a(n): A. unrelated employment practice. B. non-limiting physical disability. C. bona fide occupational qualification. D. compensation for reverse discrimination. E. regulation against an underrepresented minority group. Answer: C Learning Objective: 16-03 Topic: Staffing: Having the Right People to Sell Blooms: Analyze AACSB: Analytic Level of Difficulty: Hard Explanation: Remember that what might be labeled discrimination is allowed if an employer can show that a given action is “reasonably necessary to the operation of that particular business or enterprise” and that the employment decision is based on a “bona fide occupational qualification.” 71. Which of the following is most likely to be a bona fide occupational qualification for a job which involves moving heavy furniture? A. Ethnic background B. Religious affiliation C. Physical ability D. Educational background E. National origin Answer: C Learning Objective: 16-03 Topic: Staffing: Having the Right People to Sell Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Physical strength and ability are a bona fide occupational qualification for a job as a furniture mover. 72. A company is hiring bathroom attendants. The company would NOT be discriminating if it hires employees on the basis of ____________. A. age B. ethnicity C. religion D. gender E. national origin Answer: D Learning Objective: 16-03 Topic: Staffing: Having the Right People to Sell Blooms: UnderstandChapter 16 - Planning, Staffing, and Training Successful Salespeople 16-27 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Medium Explanation: Gender is a legitimate qualification in a job for a bathroom attendant. However, age, ethnicity, religion, and national origin are not requirements for the job. 73. To capitalize on the benefits and minimize the costs of a diverse work force, organizations should most likely strive to become: A. matrix structures. B. team-driven. C. parallel organizations. D. participative units. E. multicultural. Answer: E Learning Objective: 16-03 Topic: Staffing: Having the Right People to Sell Blooms: Remember AACSB: Diversity Level of Difficulty: Easy Explanation: To capitalize on the benefits and minimize the costs of a diverse workforce, organizations can strive to become multicultural. This term refers to the degree to which an organization values cultural diversity and is willing to utilize and encourage it. 74. A(n) _____ organization values and encourages cultural diversity. A. centralized B. multicultural C. decentralized D. counter-cultured E. international Answer: B Learning Objective: 16-03 Topic: Staffing: Having the Right People to Sell Blooms: Remember AACSB: Diversity Level of Difficulty: Easy Explanation: Multicultural refers to the degree to which an organization values cultural diversity and is willing to utilize and encourage it. 75. According to the text, a(n) _____ organization lacks prejudice and discrimination, and it creates an environment in which all members can contribute to their maximum potential. A. natural B. green C. multicultural D. individualistic E. flexible Answer: CChapter 16 - Planning, Staffing, and Training Successful Salespeople 16-28 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Learning Objective: 16-03 Topic: Staffing: Having the Right People to Sell Blooms: Remember AACSB: Diversity Level of Difficulty: Easy Explanation: The multicultural organization is marked by an absence of prejudice and discrimination and by low levels of intergroup conflict. Such an organization creates an environment in which all members can contribute to their maximum potential; thus, the advantages of diversity are fully realized. 76. Which of the following is the best definition of recruitment? A. Selecting and compensating candidates for specific job positions B. Posting advertisements to locate competent job applicants C. Searching for, finding, and interviewing people for a job D. Identifying the necessary tools for employee selection E. Designing assessments to compare job applicants Answer: C Learning Objective: 16-03 Topic: Staffing: Having the Right People to Sell Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Recruitment involves searching for, finding, and interviewing people for the job. Recruitment of salespeople takes the proper recruiters, budget, and amount of time to attract and hire quality individuals. Recruiting is typically the responsibility of the sales manager rather than the personnel department. 77. The most common tool used in hiring is: A. intelligence tests. B. in-depth interviews. C. detailed examinations. D. application forms. E. social networking. Answer: D Learning Objective: 16-03 Topic: Staffing: Having the Right People to Sell Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The application form is the most common tool used in hiring. Data collected include, such information as education, work experience, and physical and personal characteristics.Chapter 16 - Planning, Staffing, and Training Successful Salespeople 16-29 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 78. What is a drawback of personal interviews? A. Highly expensive B. Potentially subjective C. Too time consuming D. Overly fact-based E. Frequently discriminatory Answer: B Learning Objective: 16-03 Topic: Staffing: Having the Right People to Sell Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The personal interview is an important part of the selection process. Although it is a good method for obtaining factual information, it is often too subjective; however, it remains the most popular tool used by managers in building a sales force. 79. Julian is writing an application letter for a job as an IT specialist. What should Julian mention in the first sentence of the letter? A. The position he seeks B. His major achievements C. His desire for an interview D. The college degree he holds E. His interest in the company Answer: A Learning Objective: 16-03 Topic: Staffing: Having the Right People to Sell Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The application letter introduces the applicant to the prospective employer. The letter should begin by mentioning the job for which the person is applying. In the next paragraph, the applicant states reasons for interest in the position and the company. 80. If you, the job applicant, are invited for a second interview, it is safe to assume that: A. you are virtually guaranteed a job. B. the employer seeks a diverse staff. C. you met the minimum job qualifications. D. your resume lacked enough information. E. the interviewers are doubtful about hiring you. Answer: C Learning Objective: 16-03 Topic: Staffing: Having the Right People to Sell Blooms: Understand AACSB: AnalyticChapter 16 - Planning, Staffing, and Training Successful Salespeople 16-30 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: People who meet the minimum job qualifications in the initial interview are asked back for several in-depth interviews and often work with salespeople for a day in the field. 81. _____ enables a salesperson to acquire job-related concepts, rules, and skills that will improve sales performance. A. Orientation B. Job analysis C. Sales training D. Diversity training E. Environmental assessment Answer: C Learning Objective: 16-04 Topic: Training the Sales Force Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Sales training is the effort put forth by an employer to provide the opportunity for the salesperson to acquire job-related attitudes, concepts, rules, and skills that result in improved performance in the selling environment. 82. A primary goal of sales training is to: A. reduce development costs. B. increase productivity. C. raise turnover levels. D. promote diversity. E. eliminate feedback. Answer: C Learning Objective: 16-04 Topic: Training the Sales Force Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Companies are interested in training primarily to increase sales, productivity, and profits. Training can help reduce turnover and generate feedback. 83. The three basic forms of training are: A. brainstorming, role playing, and focus groups. B. discussion, role playing, and on-the-job training. C. case studies, curbside counseling, and discussion groups. D. discussion groups, on-the-job training, and lectures. E. videotaping, lectures, and case studies. Answer: B Learning Objective: 16-04Chapter 16 - Planning, Staffing, and Training Successful Salespeople 16-31 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Topic: Training the Sales Force Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The three basic training methods are discussion, role playing, and on-the-job training. 84. Which approach to sales training would most likely include case studies? A. Lecturing B. Role playing C. Discussion D. Discovery E. Practical Answer: C Learning Objective: 16-04 Topic: Training the Sales Force Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The discussion approach to sales training can be used in several ways, including case studies and/or discussion groups. Case studies are usually included in pre-session assignments. 85. In a sales training program, new recruits were asked to sell insurance to a hypothetical prospect. Which basic training method was most likely being used? A. Case extrapolation B. On-the-job training C. Role playing D. Discussion E. Classroom counseling Answer: C Learning Objective: 16-04 Topic: Training the Sales Force Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: In role playing, the trainee acts out the sale of a product or service to a hypothetical buyer. Often the trainee‟s presentation is videotaped and replayed for critique by a group, the trainee, and the trainer.Chapter 16 - Planning, Staffing, and Training Successful Salespeople 16-32 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 86. During the _____ part of the role playing procedure, the trainee is asked to think about, and then describe, the largest potential account and its buyer? A. 'critique the participants' B. 'act-out the buyer' C. 'establish the situation' D. 'brief the participants' E. 'cast the characters' Answer: C Learning Objective: 16-04 Topic: Training the Sales Force Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Role playing generally involves six steps When establishing the situation, the trainee is asked to think about, and then describe, the largest potential account and its buyer. 87. A centralized training program would most likely: A. facilitate the growth of a multicultural organization. B. be less costly than decentralized training. C. supplement basic field training. D. involve online lectures. E. encourage team selling. Answer: C Learning Objective: 16-04 Topic: Training the Sales Force Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Centralized training programs supplement the basic training done by sales personnel in the field. Decentralized training is less costly than centralized. 88. Last month, Westover Chemical salespeople from across the country gathered at the firm‟s home office to receive training on the firm‟s new line of slow-release weed killers. The facility has numerous classrooms and sales laboratories. The meeting is most likely an example of: A. centralized training. B. classroom counseling. C. active socialization. D. decentralized selling. E. operational training Answer: A Learning Objective: 16-04 Topic: Training the Sales Force Blooms: Understand AACSB: AnalyticChapter 16 - Planning, Staffing, and Training Successful Salespeople 16-33 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: Centralized training programs usually involve excellent facilities and equipment, such as classrooms, videotapes, closed circuit television, and sales laboratories designed for role playing. Because they are away from home, they can concentrate on learning. 89. Which of the following is a disadvantage of decentralized training? A. Travel costs are higher compared to centralized training. B. Decentralized training involves very high fixed costs. C. Branch managers are not always capable trainers. D. Sessions are typically very time-consuming. E. The format is overly structured. Answer: C Learning Objective: 16-04 Topic: Training the Sales Force Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A potential major weakness in decentralized training is that a branch manager may not be an able trainer, which can hurt salespeople. Centralized training is more expensive than decentralized training due to the cost of travel, meals, and facilities. 90. When choosing a sales manager to serve as a sales trainer, a firm should most likely seek an individual with a successful sales record and: A. an ability to manipulate situations. B. sufficient knowledge of marketing. C. a business and finance background. D. effective teaching skills. E. a relevant college degree. Answer: D Learning Objective: 16-04 Topic: Training the Sales Force Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The trainer must be an effective salesperson and a competent teacher. A company should choose a senior salesperson as a trainer not only on the basis of sales ability but also because of effective teaching skills.Chapter 16 - Planning, Staffing, and Training Successful Salespeople 16-34 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Essay Questions 91. What changes occur when a salesperson is promoted to sales manager? Answer: Some observable changes include having a private office, new title, secretary, and a new supervisor. The perspective changes because the organizational goals take priority. His main satisfaction lies in helping others succeed. Finally, his job skill requirements change because he needs to emphasize on his operational, relationship and interpersonal skills. Learning Objective: 16-01 Topic: Transition from Salesperson to Sales Manager Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 92. List the seven phases of transition from a salesperson to a sales manager. Answer: The seven phases of transition from a salesperson to a sales manager are: immobilization, minimization of change, depression, acceptance of reality, testing, searching for meaning, and internalization. Learning Objective: 16-01 Topic: Transition from Salesperson to Sales Manager Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 93. What common problems do new managers frequently face? What attitudes and qualities help new sales managers overcome these difficulties? Answer: One of the biggest problems the new managers face is the lack of preparation for the job. Additionally, the companies generally expect them to step into the job and function effectively immediately. Finally, they find that they have no immediate peer group to support them when needed. A new manager can overcome these problems by having a learning attitude and realistic expectations. Learning Objective: 16-01 Topic: Transition from Salesperson to Sales Manager Blooms: Analyze AACSB: Analytic Level of Difficulty: Hard 94. What are the major factors that determine managerial salary? What is a sales manager's primary goal? Answer: Managerial salaries are typically related to annual sales volume of units managed, number of salespeople supervised, length of experience in sales, and annual sales volume of the firm. The sales manager's primary goal is to achieve the levels of sales volume, profit, and sales growth desired by higher levels of management. Learning Objective: 16-01 Topic: What Is the Salary for Management? Blooms: UnderstandChapter 16 - Planning, Staffing, and Training Successful Salespeople 16-35 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Medium 95. What is involved in the planning function of management? Answer: Planning is the first function of the sales manager which involves establishing a broad outline for goals, policies, and procedures that will accomplish the goals of the organization, including forecasting and developing budgets, plus establishing the organizational design and structure. Learning Objective: 16-03 Topic: Sales Management Functions Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 96. What is the difference between organizational design and organizational structure? Answer: Organizational design refers to the formal, coordinated process of communication, authority, and responsibility for sales groups and individuals. Organizational structure is the relatively fixed, formally defined relationship among jobs within the organization. Learning Objective: 16-03 Topic: Sales Force Planning Blooms: Analyze AACSB: Analytic Level of Difficulty: Hard 97. As a future salesperson, what characteristics would enable you to be most successful? Which characteristics do you have or not have? Answer: A good salesperson must be people-oriented and should have the empathy and ego drive for a sales job. Also making the list are: high energy levels, high self-confidence, need for material things, hardworking, requiring little supervision, high perseverance, competitive, good physical appearance, likable, self-disciplined, intelligent, and achievement oriented, with good communication skills. Learning Objective: 16-03 Topic: Staffing: Having the Right People to Sell Blooms: Apply AACSB: Analytic Level of Difficulty: Hard 98. How does recruitment differ from selection? Answer: Recruitment involves searching for, finding, and interviewing people for the job. Whereas, selection refers to the process of determining if the person is right for the company and vice versa. Learning Objective: 16-03 Topic: Staffing: Having the Right People to Sell Blooms: Understand AACSB: AnalyticChapter 16 - Planning, Staffing, and Training Successful Salespeople 16-36 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium 99. Briefly explain the three basic training methods. Answer: The first method is the discussion method. The discussion approach to sales training can be used in several ways, including case studies and/or discussion groups. The second method is role playing. In role playing, the trainee acts out the sale of a product or service to a hypothetical buyer. The third method of training is on-the-job training. New salespeople may accompany their managers and observe sales calls to get trained. Learning Objective: 16-04 Topic: Training the Sales Force Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 100. Differentiate between centralized training and decentralized training. Answer: Centralized training programs usually involve excellent facilities and equipment such as classrooms, videotapes, closed circuit television, and sales laboratories designed for role playing. Trainees get to know each other and corporate executives. Because they are away from home, salespeople can concentrate on learning. Training content can be standardized so that the entire sales force has a common body of knowledge. Costs of decentralized training are usually lower than centralized training as they are conducted close to home. Unlike centralized training the sessions are usually shorter. A potential major weakness in decentralized training is that a branch manager may not be an able trainer, which can hurt salespeople. On the other hand, centralized training is expensive due to the cost of travel, meals, and facilities. Learning Objective: 16-04 Topic: Training the Sales Force Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-1 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Chapter 17 Motivation, Compensation, Leadership, and Evaluation of Salespeople Learning Objectives: 17-01 Present and discuss the five elements of the motivation mix. 17-02 Explain the basic methods of compensating salespeople. 17-03 Review three approaches to leadership and suggest leadership techniques for improving the sales manager’s effectiveness. 17-04 Discuss why salespeople must be evaluated, who should evaluate them, when they should be evaluated, what performance criteria should be evaluated, and how evaluations should be conducted. True / False Questions 1. The two levels of motivation that sales managers are concerned with are the motivation of the individual salesperson and the motivation of the entire sales force. Answer: True Learning Objective: 17-01 Topic: Motivation of the Sales Force Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Sales managers are concerned with motivating salespeople at two levels. The first is the motivation of the individual salesperson and the second is the motivation of the entire sales force. 2. Achievement awards are special financial incentives used to motivate salespeople. Answer: False Learning Objective: 17-01 Topic: The Motivation Mix: Choose Your Ingredients Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Achievement awards are nonfinancial incentives used to motivate salespeople. Special financial incentives include contests, bonuses, and trips. 3. Praise, recognition, and challenging work assignments are classified as non-financial rewards. Answer: True Learning Objective: 17-01 Topic: The Motivation Mix: Choose Your Ingredients Carefully Blooms: Remember AACSB: Analytic Level of Difficulty: EasyChapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-2 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Awards, praise, recognition, and challenging assignments are non-financial motivational tools. 4. Under the straight salary compensation plan, a salesperson's pay is directly related to sales performance. Answer: False Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: With the straight salary plan, a salesperson is paid a specific dollar amount at regular intervals, which ensures a consistent income. In theory, pay is independent of sales performance in the short run (a month, three months). However, if performance is low for a prolonged period, the company can take corrective action to improve sales or replace the salesperson. 5. According to the text, it is critical that sales managers be driven by integrity, trust, and morality because they have a significant impact on the compensation and careers of salespeople. Answer: True Learning Objective: 17-01 Topic: The Golden Rule: Management Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: If any person in an organization needs integrity, trust, and good moral character, it is a sales manager. The sales leader impacts the lives of his or her salespeople and their families. The sales manager determines people’s salary raises, promotions, and if they keep their jobs. 6. Under the straight salary compensation plan, management is able to project compensation expenses several years in advance. Answer: True Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: With a straight salary compensation plan, management can project compensation expenses for several years in the future because sales costs are relatively fixed. This can make salary budgeting much more accurate.Chapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-3 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 7. A drawback of the straight salary compensation plan is the lack of direct monetary incentive. Answer: True Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The major disadvantage of the straight salary plan is the lack of direct monetary incentive. The salesperson who meets certain job goals is rewarded by an increase in salary. However, salary adjustments are usually made at specified intervals and not always based on specific performance. 8. A straight salary compensation plan tends to increase work norms within the sales group. Answer: False Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A straight salary plan can lower work norms within the sales group. Salespeople often perceive that they are in competition with other salespeople and not with their firm’s competitors because their performance is compared with other salespeople in their sales district. They may want to do only an average job and meet or not greatly exceed sales quotas. This arrangement can thus favor the less productive salespeople. 9. Under the straight salary compensation plan, salary is distributed in proportion to the sales made. Answer: False Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: With the straight salary plan, a salesperson is paid a specific dollar amount at regular intervals, which ensures a consistent income. Pay is independent of sales performance. 10. A straight salary plan can increase sales expenses because the salary does not vary directly with the sales. Answer: True Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-4 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: The straight salary play can lead to an increase in sales expenses rather than an increase in selling efforts. Salaries do not decrease when sales are low as with straight commission plans. 11. A straight salary compensation plan can be effectively used to curtail salespeople from concentrating on easy-to-sell products. Answer: False Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A problem of using a straight salary compensation plan is that salespeople may overemphasize products that are easiest to sell, especially if this allows them to meet their sales quota. 12. Under the progressive commission plan, commission rates increase as the sales increase. Answer: True Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: With a progressive commission plan, commission percentages increase as sales increase. For example, a 10 percent commission may be paid on the first $100,000 of sales and 12 percent on sales over that amount in the same year. A person who sold $300,000 would receive $34,000 in commission [($100,000 × 0.10) + ($200,000 × 0.12) = $34,000]. 13. With a regressive commission plan, commission rates decrease as total sales increase. Answer: True Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: With regressive plans, commission rates decrease as sales increase, such as paying 12 percent on the first $100,000 and 10 percent on sales over that amount. The regressive system is used to help place an upper limit on a salesperson’s earnings to encourage top producers to accept management positions if they want to increase their earnings beyond the level attainable in a sales job.Chapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-5 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 14. The use of regressive compensation plans would discourage top performing salespeople from accepting management positions. Answer: False Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The regressive system is used to help place an upper limit on a salesperson’s earnings to encourage top producers to accept management positions if they want to increase their earnings beyond the level attainable in a sales job. 15. A major disadvantage associated with drawing accounts is that the amount given to salespeople is not based on the individual needs of the salesperson. Answer: False Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The drawing account combines the incentive of a commission plan with the security of a fixed income. The firm establishes a monetary account for each salesperson. The amount may be based on the individual needs of the salesperson; a base level set by the company; or a base level that considers the individual salesperson’s needs, background, and selling potential. 16. Although it is difficult to administer the straight commission plan, many organizations prefer to use this plan because selling costs are kept in proportion to sales. Answer: False Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Many organizations prefer to use the commission plan because it is simple to administer and selling costs are kept in proportion to sales. 17. Salespeople under a straight commission plan are frequently reluctant to split territories after building rapport with customers. Answer: True Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-6 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Under the straight commission plan, salespeople are much more reluctant to split territories or move from their present territory to another territory. They may have spent time building a rapport with their customers and do not want to relinquish it. 18. Handling returned goods and bad debts is a greater administrative problem for firms that pay salespeople using a commission plan than for firms that pay straight salaries. Answer: True Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Firms that pay salespeople through commissions face administrative issues when it comes to customers with debt problems or returns. A salesperson may have sold a product to a customer who is unable to pay or goes bankrupt. If the salesperson is not directly responsible for the extension of credit to accounts, most firms will not withdraw a commission. The same is true for sales returns. 19. A salesperson working under a combination salary plan receives both a base salary and a commission or bonus. Answer: True Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Under a combination salary plan, a proportion of the salesperson’s total pay is guaranteed while some of it can come from commissions. The most commonly used percentage split is 80 percent base salary and 20 percent incentive. 20. A bonus is a financial reward given in addition to what is usually earned over an extended period of time. Answer: True Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A bonus is something given in addition to what the salesperson usually earns. Typically, it is money earned over an extended period, such as one year.Chapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-7 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 21. Sales contests serve as incentives to achieve long-term sales goals, but they typically lead to high levels of absenteeism and turnover. Answer: False Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Sales contests are special sales programs offering salespeople incentives to achieve short-term sales goals. Occasionally, contests may run for as long as a year; examples include the insurance or real estate industry’s million dollar club. Many sales managers feel that these contests, as well as bonuses, can increase the team spirit of their sales groups, interest in the job, and job satisfaction and can discourage absenteeism and turnover. 22. According to the text, more firms use incentive travel programs than merchandise awards to motivate salespeople. Answer: False Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Industry typically spends 78 percent on merchandise awards and 22 percent on incentive travel programs. 23. The task behavioral form of leadership is characterized by two-way communication. Answer: False Learning Objective: 17-03 Topic: Leadership Is Important to Success Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Relationship behavior is people oriented. It involves the extent to which the leader uses two-way communication, not one-way as in task behavior. 24. The relationship form of leadership can include activities such as listening, providing clarification, and giving positive feedback. Answer: True Learning Objective: 17-03 Topic: Leadership Is Important to Success Blooms: Remember AACSB: Analytic Level of Difficulty: EasyChapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-8 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Relationship behavior involves the extent to which the leader uses two-way communication. It includes listening, providing clarification, getting to know the individual’s motives and goals, and giving positive feedback to help reinforce such things as a person’s self-image, confidence, and ego. 25. The ‘tells' leadership style has both high task orientation and low relationship behavior. Answer: True Learning Objective: 17-03 Topic: Leadership Is Important to Success Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A telling leadership style is characterized by above-average levels of task behavior and below-average levels of relationship behavior. 26. In a participating leadership style, the sales manager makes all decisions for the salesperson. Answer: False Learning Objective: 17-03 Topic: Leadership Is Important to Success Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The sales manager makes all decisions in the telling leadership style. In the participating leadership style, the sales manager and salesperson make decisions together. 27. The persuasive style of leadership is characterized by above-average levels of task and relationship behavior. Answer: True Learning Objective: 17-03 Topic: Leadership Is Important to Success Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A persuading leadership style is characterized by above-average amounts of both task and relationship behavior. The sales manager makes the decision; however, the salesperson’s cooperation is sought by explaining what needs to be done and then persuading the salesperson to carry out the decision.Chapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-9 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 28. An organization's salespeople are experiencing declining sales due to the introduction of a competitor's new product. Participative leadership is best suited in this situation. Answer: False Learning Objective: 17-03 Topic: Leadership Is Important to Success Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: When salespeople are experiencing declining sales due to the introduction of a competitor’s new product, the participative style would not be suitable. The salespeople need more direction so the persuading or telling style would be better in this situation. 29. A delegating leadership style is characterized by below-average levels of both task behavior and relationship behavior. Answer: True Learning Objective: 17-03 Topic: Leadership Is Important to Success Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A delegating leadership style is characterized by below-average levels of both task behavior and relationship behavior. The delegating type of leadership provides little direction, low levels of personal contact, and little supportive behavior. 30. Coaching refers training a salesperson in the home office and rarely involves a manager accompanying a salesperson on a sales call. Answer: False Learning Objective: 17-03 Topic: Leadership Is Important to Success Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Coaching refers to training someone on the job intensively through instruction, demonstration, and practice. The main element of a coaching session is the joint sales callChapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-10 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 31. The main evaluator of a salesperson should be the salesperson's immediate supervisor. Answer: True Learning Objective: 17-04 Topic: Performance Evaluations Let People Know Where They Stand Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The primary evaluator should be the salesperson’s immediate superior because this person has direct knowledge about sales performance. The manager has actually worked with the salesperson. 32. Salespeople should receive evaluations at the end of every performance cycle. Answer: True Learning Objective: 17-04 Topic: Performance Evaluations Let People Know Where They Stand Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Salespeople should be evaluated at the end of each performance cycle. A performance cycle is a period related to specific product goals and/or job activities. 33. Each salesperson at a firm should receive at least one formal evaluation every year. Answer: True Learning Objective: 17-04 Topic: Performance Evaluations Let People Know Where They Stand Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Periodic performance evaluations provide the input for semiannual and/or annual performance evaluations. A minimum of one formal evaluation should be completed yearly for each salesperson. 34. A salesperson's ability to overcome objections is an example of quantitative criteria. Answer: False Learning Objective: 17-04 Topic: Performance Evaluations Let People Know Where They Stand Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The ability to overcome objections is an example of qualitative criteria. Quantitative criteria include gross profit and number of sales calls.Chapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-11 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 35. Immediate supervisors typically establish procedures for who will do the evaluation and how it will be done. Answer: False Learning Objective: 17-04 Topic: Performance Evaluations Let People Know Where They Stand Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Typically, the company sets up procedures for who will do the evaluation and how it will be done. The performance criteria for evaluation have been decided and materials, such as evaluation forms, are available. Multiple Choice Questions 36. Which term refers to the arousal, intensity, direction, and persistence of effort directed toward job tasks over time? A. Enrichment B. Direction C. Motivation D. Influence E. Simulative response Answer: C Learning Objective: 17-01 Topic: Motivation of the Sales Force Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Motivation is the arousal, intensity, direction, and persistence of effort directed toward job tasks over a period. The sales manager strives to increase the motivation of salespeople toward performing their job activities at a high level through the development of a motivation mix. 37. The motivation mix consists of all of the following components EXCEPT: A. management control procedures. B. special financial incentives. C. nonfinancial rewards. D. leadership techniques. E. hygiene factors. Answer: E Learning Objective: 17-01 Topic: The Motivation Mix: Choose Your Ingredients Carefully Blooms: Remember AACSB: Analytic Level of Difficulty: EasyChapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-12 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: The motivation mix consists of the basic compensation plan, management control procedures, leadership techniques, nonfinancial rewards, and special financial incentives. Hygiene factors are not a component. 38. Praise and recognition are part of the _____ element of a sales manager's motivation mix. A. basic compensation plan B. special financial incentives C. synergistic techniques D. nonfinancial rewards E. management control procedures Answer: D Learning Objective: 17-01 Topic: The Motivation Mix: Choose Your Ingredients Carefully Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Nonfinancial rewards include challenging work assignments, praise, and recognition. 39. Performance evaluation is a part of the _____ element of a sales manager's motivation mix. A. basic compensation plan B. special financial incentives C. synergistic techniques D. nonfinancial rewards E. management control procedures Answer: E Learning Objective: 17-01 Topic: The Motivation Mix: Choose Your Ingredients Carefully Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Management control procedures include sales quotas, reports, and performance evaluations.Chapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-13 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 40. Robin, a pharmaceutical sales representative, was recently given a key account. She is excited about the challenging assignment. Robin’s sales manager is most likely motivating Robin with a: A. nonfinancial reward. B. achievement award. C. salary increase. D. commission. E. fringe benefit. Answer: A Learning Objective: 17-01 Topic: The Motivation Mix: Choose Your Ingredients Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Nonfinancial rewards include challenging work assignments, praise, and recognition. Robin’s manager is motivating her with a challenging and important account. 41. For most salespeople, which of the following provides the greatest motivation? A. Sales achievement awards B. Co-worker recognition C. National sales meetings D. Positive evaluations E. Financial rewards Answer: E Learning Objective: 17-01 Topic: The Motivation Mix: Choose Your Ingredients Carefully Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Money is a primary tool for motivating salespeople. Awards, recognition, and good evaluations are important but less critical for most salespeople. 42. Sales performance is rewarded in three fundamental ways. They are: A. drawing accounts, bonuses, and fixed salaries. B. commission, salaries, and nonfinancial awards. C. financial compensation, bonuses, and national awards. D. extrinsic rewards, intrinsic rewards, and special group memberships. E. direct financial rewards, career advancement, and nonfinancial compensation. Answer: D Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Remember AACSB: Analytic Level of Difficulty: EasyChapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-14 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Sales performance can be rewarded in three fundamental ways: direct financial rewards, such as merit salary increases and bonuses; career advancement; and nonfinancial compensation such as recognition dinners and small gifts. 43. Which of the following statements about compensation for salespeople is most likely true? A. Compensation refers only to monetary motivational tools. B. A sales reward system is the only means of motivating salespeople. C. Studies show that nonfinancial compensation fails to motivate salespeople. D. Straight salary plans are complex to implement and provide minimal motivation. E. Money is a powerful performance motivator if used with the right compensation plan. Answer: E Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Money can be an extremely powerful performance motivator if used with the right compensation program. Of all compensation plans, the straight salary plan is the simplest. Compensation refers to both financial and nonfinancial rewards. 44. Which of the following compensation plans is considered the simplest? A. Straight commission B. Structured combination C. Straight salary D. Drawing account E. Performance bonus Answer: C Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Of all compensation plans, the straight salary plan is the simplest. 45. From a salesperson's point of view, which of the following describes an advantage inherent in a straight salary compensation plan? A. The plan facilitates team selling. B. The plan gives salespeople financial security. C. The plan minimizes the financial burden on employers. D. The plan clearly links high performance with compensation. E. The plan typically increases work norms within the sales group. Answer: B Learning Objective: 17-02 Topic: Compensation Is More Than MoneyChapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-15 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The straight salary plan provides the sense of security that a person may require for effective selling because it ensures a regular income. 46. A straight salary plan: A. increases the work norms within a sales group. B. includes all monetary and non-monetary incentives. C. encourages friendly competition among salespeople. D. makes it difficult for a firm to take corrective actions. E. enables a company to direct salespeople to important activities. Answer: E Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Salespeople can be directed toward tasks the company believes are important much more easily than if they were on a straight commission plan. Management can direct selling duties that may not immediately result in sales, such as contacting nonproductive accounts or routinely calling on customers who purchase the company’s products from a distribution center or wholesaler outside the territory. 47. From management's point of view, which of the following describes an advantage inherent in a straight salary compensation plan? A. Selling costs are kept in proportion to sales. B. Salespeople are less resistant to reassignments of accounts. C. Salespeople are highly motivated and employee turnover decreases. D. A straight salary plan increases the work norms within the sales group. E. Straight salary plans foster the development of highly productive salespeople. Answer: B Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Understand AACSB: AnalyticChapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-16 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Medium Explanation: With a straight salary compensation plan, management usually finds less resistance to reassignments of accounts and personnel transfers with this arrangement. 48. Which compensation plan most likely discourages the use of high-pressure selling techniques? A. Straight commission B. Salary and commission C. Structured commission D. Straight salary E. Salary and bonus Answer: D Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: With the straight salary plan, salespeople are less likely to use high-pressure tactics. They are unlikely to overload customers with merchandise that may bring rewards to the salesperson, but may not be best for the buyer or the company. 49. Which of the following statements describes a disadvantage inherent in the straight salary compensation plan? A. The straight salary plan causes the salesperson to experience uncertainty and insecurity of payment. B. The plan makes it difficult for an organization to take corrective action to improve sales if the performance of the salesperson is low for a prolonged period. C. A lack of incentive may cause efficient, high-performing salespeople to change jobs. D. Directing salespeople toward tasks the company believes are important becomes difficult. E. Management cannot project future compensation expenses of the sales force. Answer: C Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-17 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: The major disadvantage is the lack of direct monetary incentive. Often, everyone is given the same salary increase or there is little difference in the pay adjustments that the higher performers and the lower performers receive. This lack of incentive may cause better salespeople to change jobs. 50. In an effort to overcome the problems typically associated with the straight salary compensation plans, many companies: A. ask salespeople to resort to high-pressure selling tactics. B. reduce the number of accounts assigned to salespeople. C. employ only college graduates as sales representatives. D. increase the number of sales managers. E. eliminate all commissions. Answer: D Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Many companies increase the number of sales managers to offset problems associated with straight salary compensation plans. Each manager has fewer salespeople to supervise, helping to ensure that each salesperson works at maximum capacity. However, this approach usually results in an increase in sales expenses rather than a selling effort. 51. The _____ plan is a complete incentive compensation plan. A. structured commission B. salary and commission C. straight commission D. straight salary E. salary and bonus Answer: C Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The straight commission plan is a complete incentive compensation plan. If you do not sell anything, you do not earn anything. There are two basic types of commission plans: straight commission and draw against commission.Chapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-18 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 52. The two basic types of commission plans are straight commission and: A. non-financial commission. B. draw against commission. C. quota-based commission. D. experience-based commission. E. performance bonuses. Answer: B Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The straight commission plan is a complete incentive compensation plan. There are two basic types of commission plans: straight commission and draw against commission. 53. The commission rate increases as the salesperson sells an increasing amount of product. This is called a(n) _____ commission plan. A. linear B. parabolic C. regressive D. progressive E. curvilinear Answer: D Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: When the commission rate increases, it is a progressive commission plan. For example, a 10 percent commission may be paid on the first $100,000 of sales and 12 percent on sales over that amount in the same year. 54. Which of the following statements about progressive commission plan is most likely true? A. Salespeople are given an increased number of territories based on annual performance. B. A salesperson must call on more accounts each week until saturation is reached. C. A salesperson's commission rate increases as total sales increase. D. Salespeople earn a fixed salary plus additional annual bonuses. E. A salesperson is rewarded for increasing nonselling activities. Answer: C Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-19 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: When the commission rate increases as total sales increase, a progressive commission plan is being used. For example, a 10 percent commission may be paid on the first $100,000 of sales and 12 percent on sales over that amount in the same year. 55. The commission rates of sales decreases as the sales increase. This is an example of the _____ commission plan. A. progressive B. regressive C. parabolic D. negative E. curvilinear Answer: B Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Some companies use a regressive plan, in which commission rates decrease as sales increase, such as paying 12 percent on the first $100,000 and 10 percent on sales over that amount. 56. With a regressive compensation plan, a: A. salesperson's commission rate decreases as total sales increase. B. salesperson calls on more accounts each week until reaching saturation. C. salesperson’s territory is increased exponentially as total sales increase. D. salesperson earns a base amount plus bonuses for meeting superlative goals. E. salesperson is financially disciplined for spending too much time on nonselling activities. Answer: A Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Some companies use a regressive plan, in which commission rates decrease as sales increase, such as paying 12 percent on the first $100,000 and 10 percent on sales over that amount. 57. Kia Lang's pay plan reduces her commission as her sales increase. She receives a 10 percent commission on the first $250,000 and 6 percent on sales over that amount. For sales of $500,000, she would receive 5 percent. This is an example of a _____ plan. A. linear B. integrated C. conservative D. reinforcement E. regressiveChapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-20 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Answer: E Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Kia’s firm uses a regressive plan, in which commission rates decrease as sales increase. 58. An organization would most likely use a regressive commission plan to: A. reward newly-hired salespeople during training periods. B. motivate the highest-performing salespeople. C. encourage top sales performers to be managers. D. decrease fixed costs of maintaining the sales force. E. maintain a drawing account for customer returns. Answer: C Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The regressive system is used to help place an upper limit on a salesperson’s earnings to encourage top producers to accept management positions if they want to increase their earnings beyond the level attainable in a sales job. In some companies, a top salesperson can earn more than a boss, and even more than the president of the company. 59. Louise Hunt receives $250 per week in anticipation of the commissions she is expected to earn in the coming week. This payment is called a(n) ____. A. draw against commission B. award advancing C. judgmental incentive D. progressive payment E. regressive payment Answer: A Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Remember AACSB: AnalyticChapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-21 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Level of Difficulty: Easy Explanation: Louise is given a draw against commissions. Drawing accounts combine the incentive of a commission plan with the security of a fixed income. 60. The _____ combines the incentive of a commission plan with the security of a fixed income. A. regressive account B. drawing account C. performance bonus D. group incentive E. progressive incentive Answer: B Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The drawing account combines the incentive of a commission plan with the security of a fixed income. The firm establishes a monetary account for each salesperson based on the individual needs of the salesperson; a base level set by the company; or a base level that considers the individual salesperson’s needs, background, and selling potential. 61. Which of the following is an advantage of the straight commission plan? A. Typically, loyalty towards the company among the sales force is very high. B. The plan provides a maximum incentive and the opportunity to earn top money. C. It provides a sense of security and certainty of earning to salespeople. D. Salespeople are discouraged from using high-pressure selling tactics. E. Turnover in the sales force tends to be low with this plan. Answer: B Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Many sales managers believe that the commission plan provides maximum incentive for salespeople. However, financial security for salespeople is low and turnover is high. 62. Which of the following statements about a commission plan is most likely true? A. Employee loyalty to the firm increases. B. Selling costs are kept in proportion to sales. C. Recruiting costs are significantly decreased. D. Salespeople strive to complete nonselling tasks. E. Team selling and territory splitting are encouraged. Answer: BChapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-22 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Many organizations prefer to use the commission plan because selling costs are kept in proportion to sales. However, such plans tend to lower employee loyalty, increase turnover, and increase recruiting costs. Nonselling tasks do not pay, so salespeople are less likely to complete them, and salespeople do not want to split profitable territories. 63. Which of the following is a disadvantage of straight commission plans? A. The plans are only suitable for companies with large sales budgets. B. The plans trigger high selling costs even without significant sales. C. Such plans cannot be administered easily by most firms. D. Salespeople conduct too much customer service. E. Salespeople are reluctant to change territories. Answer: E Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Under the straight commission plan, salespeople are much more reluctant to split territories or move from their present territory to another territory. They may have spent time building a rapport with their customers and do not want to relinquish it.Chapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-23 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 64. Ben, a computer systems salesperson, is compensated by his firm with a drawing account plan. At the beginning of each month, Ben receives $1,000. This month, Ben’s sales resulted in commissions of $2,500. What will most likely occur as a result? A. Ben will receive an additional $3,500 from the firm. B. Ben will receive an additional $2,500 from the firm. C. Ben will receive an additional $1,500 from the firm. D. Ben will pay the firm $1,500. E. Ben will pay the firm $1,000. Answer: C Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Analyze AACSB: Analytic Level of Difficulty: Hard Explanation: The drawing account combines the incentive of a commission plan with the security of a fixed income. Ben draws $1,000 each month against his commissions for the month. Because his commissions were $2,500, the firm owes him an additional $1,500. 65. Under a _____ plan, a proportion of the salesperson's total pay is guaranteed while some of it can come from commissions. A. straight salary B. straight commission C. combination salary D. drawing account E. operational incentive Answer: C Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: With a combination salary plan, a proportion of the salesperson’s total pay is guaranteed while some of it can come from commissions. The most commonly used percentage split is 80 percent base salary and 20 percent incentive. 66. Morgan-Hunt Agency, a financial investment company, pays $300 to each of its salespersons as a year-end bonus, regardless of productivity. This is an example of a(n): A. nonperformance bonus. B. drawing account plan. C. advance commission. D. team-selling bonus. E. across-the-board bonus. Answer: E Learning Objective: 17-02 Topic: Compensation Is More Than MoneyChapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-24 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The across-the-board bonus is given at one time to all salespeople, regardless of their productivity. An equal sum of money may be paid to each salesperson, or the bonus may be based on current salary and tenure with the organization. 67. Performance bonuses are typically categorized by either: A. tenure or job performance compensation levels. B. long-term or short-term recommendations. C. pre- or post-performance job evaluations. D. individual or group rewards. E. fixed or flexible rates. Answer: D Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: One type of bonus is related to performance. Numerous bonus plans of this type can be devised, but they fall into two general categories according to whether they are awarded on an individual or group basis. 68. Which term refers to special sales programs offering salespeople incentives to achieve short-term sales goals? A. Fringe benefits B. Sales contests C. Performance bonuses D. Compensation awards E. Organizational bonuses Answer: B Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Remember AACSB: Analytic Level of Difficulty: EasyChapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-25 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: Sales contests are special sales programs offering salespeople incentives to achieve short-term sales goals. The incentives may include items that indicate recognition of achievement (e.g., certificates, cash, merchandise, or travel). 69. _____ is a process by which the sales manager uses both task and relationship behaviors to influence the activities of salespeople. A. Motivation B. Engagement C. Enrichment D. Leadership E. Evaluation Answer: D Learning Objective: 17-03 Topic: Leadership Is Important to Success Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Leadership is the process by which the sales manager attempts to influence the activities of salespeople through guidance by direction and example. Successful leaders exhibit both task and relationship behavior in different situations. 70. A manager characterized by a high level of task behavior: A. gives a generous amount of feedback to reinforce positive behavior. B. closely supervises the individual or group to make sure the job is done. C. exhibits a democratic attitude toward motivation. D. uses two-way communication frequently. E. prefers a flatter organizational structure. Answer: B Learning Objective: 17-03 Topic: Leadership Is Important to Success Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Task behavior involves the leader in describing the duties and responsibilities of an individual or group. This includes telling people what to do, how to do it, when to do it, where to do it, and who is to do it. In addition, the person is closely supervised to make sure the job is done correctly. Relationship behavior is people oriented.Chapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-26 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 71. Your new boss gives very detailed instructions and closely watches your progress. This shows your boss's: A. motivation mix. B. qualitative performance factor. C. task behavior. D. participative leadership style. E. relationship behavior. Answer: C Learning Objective: 17-03 Topic: Leadership Is Important to Success Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Task behavior involves telling people what to do, how to do it, when to do it, where to do it, and who is to do it. In addition, subordinates are closely supervised to make jobs are done correctly. 72. _____ involves the extent to which a leader listens, provides clarification, and gives positive feedback. A. Autonomous leadership B. Task behavior C. Centralization D. Relationship behavior E. Directive behavior Answer: D Learning Objective: 17-03 Topic: Leadership Is Important to Success Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: Relationship behavior involves the extent to which the leader uses two-way communication, not one-way as in task behavior. It includes listening, providing clarification, getting to know the individual’s motives and goals, and giving positive feedback to help reinforce such things as a person’s self-image, confidence, and ego. 73. All of the following are relationship behaviors EXCEPT: A. providing clarification. B. giving positive feedback. C. providing useful guidance. D. giving appropriate encouragement. E. describing organizational responsibilities. Answer: E Learning Objective: 17-0 Topic: Leadership Is Important to Success Blooms: UnderstandChapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-27 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Medium Explanation: Relationship behavior involves the extent to which the leader uses two-way communication, not one-way as in task behavior. It includes listening, providing clarification, getting to know the individual’s motives and goals, and giving positive feedback to help reinforce such things as a person’s self-image, confidence, and ego. 74. Rachel, an experienced sales representative, was told by her sales manager how to develop a sales presentation. Rachel’s manager is most likely following a _____ leadership style. A. telling B. persuading C. participating D. complying E. delegating Answer: A Learning Objective: 17-03 Topic: Leadership Is Important to Success Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A telling leadership style is characterized by above-average levels of task behavior and below-average levels of relationship behavior. Rachel’s boss told her how to develop a sales presentation. 75. Phil, an inexperienced salesperson, is nervous about his ability to close a sale. What type of leadership style would be most appropriate for Phil’s supervisor to use? A. Supporting B. Telling C. Delegating D. Persuading E. Participating Answer: B Learning Objective: 17-03 Topic: Leadership Is Important to Success Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-28 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: A telling leadership style is characterized by above-average levels of task behavior and below-average levels of relationship behavior. The telling style is appropriate to use when a new salesperson is unsure of how to perform a task, such as closing a sale. 76. Which of the following leadership styles is characterized by high task behavior and low relationship behavior? A. Telling B. Complying C. Participating D. Surmising E. Delegating Answer: A Learning Objective: 17-03 Topic: Leadership Is Important to Success Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A telling leadership style is characterized by above-average levels of task behavior and below-average levels of relationship behavior. A persuading leadership style is characterized by above-average amounts of both task and relationship behavior. 77. What two components should determine the best leadership style to use? A. Product and situation B. Salesperson and situation C. Salesperson and compensation plan D. Organization and product complexity E. Compensation plan and organizational culture Answer: B Learning Objective: 17-03 Topic: Leadership Is Important to Success Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A sales manager should choose a leadership style based on the salesperson and the situation.Chapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-29 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 78. Beth, an experienced salesperson, has recently been given a key account. Beth is motivated to perform a good job but is having trouble effectively carrying out her responsibilities. Beth is having a meeting with her sales manager to address the issue. Which leadership style should Beth’s manager most likely use? A. Persuading B. Telling C. Consulting D. Delegating E. Participating Answer: A Learning Objective: 17-03 Topic: Leadership Is Important to Success Blooms: Apply AACSB: Analytic Level of Difficulty: Hard Explanation: A persuading leadership style, characterized by above-average amounts of both task and relationship behavior, would be best in this situation. Beth’s sales manager should make decisions but gain Beth’s cooperation by explaining what needs to be done and persuading Beth to carry out the decision. 79. A sales manager who uses the persuading leadership style most likely: A. shares all decision-making authority. B. makes decisions without discussion. C. makes and discusses most decisions. D. seeks mutually created decisions. E. offers no decision-making direction. Answer: C Learning Objective: 17-03 Topic: Leadership Is Important to Success Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: A persuading leadership style is characterized by above-average amounts of both task and relationship behavior. The sales manager makes the decision; however, the salesperson’s cooperation is sought by explaining what needs to be done and then persuading the salesperson to carry out the decision. 80. Which leadership style is characterized by low task behavior and high relationship behavior? A. Telling B. Persuading C. Complying D. Participating E. Delegating Answer: DChapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-30 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Learning Objective: 17-03 Topic: Leadership Is Important to Success Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A participating leadership style is characterized by above-average levels of relationship behavior and below-average levels of task behavior. 81. In an organization, the salespeople and the sales manager decide things together. Which of the following leadership styles is being used here? A. Telling B. Persuading C. Participating D. Complying E. Delegating Answer: C Learning Objective: 17-03 Topic: Leadership Is Important to Success Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A participating leadership style is characterized by above-average levels of relationship behavior and below-average levels of task behavior. In such situations, the salesperson and manager make decisions together. 82. The _____ style of leadership is characterized by low task behavior and low relationship behavior. A. telling B. persuading C. participating D. complying E. delegating Answer: E Learning Objective: 17-03 Topic: Leadership Is Important to Success Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: A delegating leadership style is characterized by below-average levels of both task behavior and relationship behavior. The delegating type of leadership provides little direction, low levels of personal contact, and little supportive behavior.Chapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-31 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 83. A sales manager should most likely use a _____ style of leadership if the sales force contains highly motivated, seasoned salespeople who strive to be top performers. A. persuading B. telling C. consulting D. delegating E. empathizing Answer: D Learning Objective: 17-03 Topic: Leadership Is Important to Success Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The delegating style is best when salespeople are high-performing, seasoned veterans who are highly motivated to be top performers. The sales manager lets a salesperson do the job with little direction. 84. What is a characteristic of the delegating leadership style? A. Clear direction B. Constant support C. Frequent feedback D. One-way communication E. Minimal personal contact Answer: E Learning Objective: 17-03 Topic: Leadership Is Important to Success Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: The delegating type of leadership provides little direction, low levels of personal contact, and little supportive behavior. 85. A joint sales call is best described as a: A. coaching technique. B. form of cold calling. C. component of team selling. D. tool for dividing sales territories. E. technique used to share commissions. Answer: A Learning Objective: 17-04 Topic: Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-32 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Explanation: A joint sales call, which is a main element of coaching, occurs when a manager accompanies a person on a sales call. By observing what went on face-to-face with customers, the manager can discuss strengths and opportunities to improve immediately after the sales call. 86. The primary evaluator of a salesperson's performance should most likely be: A. a trained evaluator from outside the firm. B. a member of the human resource department. C. the salesperson's immediate supervisor. D. the salesperson's peers. E. a union representative. Answer: C Learning Objective: 17-04 Topic: Performance Evaluations Let People Know Where They Stand Blooms: Remember AACSB: Analytic Level of Difficulty: Easy Explanation: The primary evaluator should be the salesperson’s immediate superior because this person has direct knowledge about sales performance. The manager has actually worked with the salesperson. 87. What is the LEAST likely purpose of a management control system? A. establishing performance goals. B. implementing new technologies. C. comparing goals to accomplishments. D. providing rewards based on achievements. E. determining penalties for inadequate performance. Answer: B Learning Objective: 17-04 Topic: Performance Evaluations Let People Know Where They Stand Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: At the end of each performance period, such as the end of the year, the manager evaluates each salesperson’s performance. This creates a management control system that establishes performance goals, evaluates the salesperson’s accomplishments compared to those goals, and then rewards or penalizes the individual based on the performance level.Chapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-33 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 88. Which of the following is an example of a quantitative performance criterion used to evaluate a salesperson's performance? A. Listening skills B. Use of time C. Product knowledge D. Quality orientation E. New customers obtained Answer: E Learning Objective: 17-04 Topic: Performance Evaluations Let People Know Where They Stand Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Quantitative performance criteria are best for effectively evaluating performance. This category represents end results or bottom-line objective data, such as new customers obtained. Listening skills, time usage, and product knowledge are qualitative criteria. 89. Which of the following is an example of a qualitative performance criterion used to evaluate a salespeople's performance? A. Sales volume B. Gross profit achieved C. Product knowledge D. Market share E. New customers obtained Answer: C Learning Objective: 17-04 Topic: Performance Evaluations Let People Know Where They Stand Blooms: Understand AACSB: Analytic Level of Difficulty: Medium Explanation: Many organizations use qualitative performance criteria because they represent the salesperson’s major job activities, such as product knowledge and selling skills. Sales volume, gross profits, market share, and new customers obtained are quantitative criteria. 90. The last step in the process of evaluating a salesperson is to: A. develop mutually agreed-on objectives. B. summarize the total performance evaluation. C. finalize the performance evaluation. D. formalize the evaluation and objectives. E. summarize major sales management issues. Answer: D Learning Objective: 17-04 Topic: Performance Evaluations Let People Know Where They Stand Blooms: RememberChapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-34 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. AACSB: Analytic Level of Difficulty: Easy Explanation: In the last step of the performance evaluation process, the manager should write a letter to the salesperson restating the results of the performance evaluation and the objectives. A copy is sent to the manager’s superior to go into the salesperson’s permanent personnel file. Essay Questions 91. List the five broad classes of factors in the motivation mix. Answer: The five broad classes of motivation mix are: (1) The basic compensation plan, (2) special financial incentives, (3) nonfinancial rewards, (4) leadership techniques, and (5) management control procedures. Learning Objective: 17-01 Topic: The Motivation Mix: Choose Your Ingredients Carefully Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 92. What is straight salary compensation plan? What are the disadvantages associated with the straight salary compensation plan? Answer: Of all compensation plans, the straight salary plan is the simplest. The salesperson is paid a specific dollar amount at regular intervals, usually weekly, semimonthly, or monthly. The major disadvantage associated with this plan is the lack of direct monetary incentive. The straight salary plan can lower work norms within the sales group. Furthermore, it does not distribute the salary in proportion to sales made. Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Analyze AACSB: Analytic Level of Difficulty: Hard 93. What are the three basic elements of the straight commission plan? Answer: The three basic elements of the straight commission plan are: (1) Relate pay directly to a performance unit. (2) Attach a percentage rate of commission to the unit. (3) Establish levels at which commissions begin or change. Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-35 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 94. Describe a regressive commission plan. When would a company use a regressive commission plan? Answer: With a regressive commission plan, commission rates decrease as sales increase. It is used to help place an upper limit on a salesperson's earnings to encourage top producers to accept management positions if they want to increase their earnings beyond the level attainable in a sales job. Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Analyze AACSB: Analytic Level of Difficulty: Hard 95. Why do companies select the straight commission plan? Answer: Many organizations prefer to use the commission plan because it is simple to administer and selling costs are kept in proportion to sales. This is important to a new firm that cannot afford to pay a portion of its salespeople a salary if they are not profitably productive, or during an economic recession that could cause sales costs to severely affect profits. The firm with limited capital can hire as many salespeople as needed and have no salary costs until sales are made. Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Analyze AACSB: Analytic Level of Difficulty: Hard 96. What are the advantages of using a combination salary plan? Answer: Under a combination salary plan, a proportion of the salesperson's total pay is guaranteed while some of it comes from commissions. The advantages of using this plan is that it: (1) motivates the sales force, (2) attracts and holds good people, and (3) can be used to direct the sales force effort in a profitable direction. Learning Objective: 17-02 Topic: Compensation Is More Than Money Blooms: Understand AACSB: Analytic Level of Difficulty: MediumChapter 17 - Motivation, Compensation, Leadership, and Evaluation of Salespeople 17-36 © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 97. What are the two forms of behaviors that leaders can use to influence salespeople? Answer: The two forms of behaviors that leaders can use to influence salespeople are task behavior and relationship behavior. The task behavior involves the leader in describing the duties and responsibilities of an individual or group. The relationship behavior involves the extent to which the leader uses two-way communication. Learning Objective: 17-03 Topic: Leadership Is Important to Success Blooms: Understand AACSB: Analytic Level of Difficulty: Medium 98. Briefly describe the various leadership styles. Answer: The various leadership styles are: (1) Telling, (2) persuading, (3) participating, and (4) delegating. A telling leadership style is characterized by above-average levels of task behavior and below-average levels of relationship behavior. A persuading leadership style is characterized by above average amounts of both task and relationship behavior. A participating style is characterized by below-average levels of task behavior and aboveaverage levels of relationship behavior. A delegating leadership style is characterized by below-average levels of both task and relationship behavior. Learning Objective: 17-03 Topic: Leadership Is Important to Success Blooms: Analyze AACSB: Analytic Level of Difficulty: Hard 99. Who should be the primary evaluator of a salesperson's performance? Why? Answer: The salesperson's immediate superior should be the primary evaluator because this person actually works with the salesperson and has direct knowledge about his (sales) performance. Learning Objective: 17-04 Topic: Performance Evaluations Let People Know Where They Stand Blooms: Understand AACSB: Analytic [Show More]

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