Question

Selling to a prospect is not the same as selling to a long-term established customer. Using real-life examples, compare five (5) distinctions between transactional selling and key account management to illustrate their differences.

Answer 1

Answer 1) Well selling a product to a prospect customer is way more difficult than selling to an old established customer, because old customer is the one who is already aware about the company and its offering. So let’s talk about 5 differences between selling a product to these two target segments:

1) Personal Selling is totally different: When selling a product to a prospect as he/she is a new customer so a lot of persuasive power is required, salesman have to do a lot of hard work so as to impress these customers because these customer are new and don’t know about the quality of product and do a sale to them whereas when selling a product to existing customer it is very easy because that customer has already purchased your product and knows about quality of your product.

2) Advertisement and Sales Promotion: Prospect customer can only be sold product when he/she is interested and interest comes from knowing the benefits of the product. So with help of advertising and promotion benefits can be told to these set of customers while for existing customer such promotion and advertisement at high scale is not required.

3) Building Trust: For new and potential customers it becomes very important to make them believe in the product and company, gaining trust is very much required for the company so as to make prospect customers feel comfortable whereas for old customer that trust is already build.

4) Customized offers: For new customers the offers and discount are usually more than the existing customers so as to break their relation from their old company. This is an extra expense for the company.

5) Company expense: Company expense of potential customers is more than as compared to existing customers because for new customer a lot of promotion is required, a lot of money is wasted in doing research, advertisement, offers and discounts etc.