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Chapter Five — Strategic Prospecting

and Preparing for Sales Dialogue

Exercises
1. Why is prospecting an important activity for salespeople?

Prospecting is an important activity because it is the primary means of growing revenue and guarding
against the effects of customer turnover. While it’s possible to increase revenue by raising prices, in most
cases the most effective way to increase revenue and grow market share is to acquire new customers.
Next, given that customer turnover is inevitable, prospecting allows salespeople to keep new customers
coming in to replace those that are lost. While it is possible and even desirable to grow business with
existing customers, it is unlikely that such growth could ever be great enough to make up for business
lost to turnover.

2. What should be the objectives of strategic prospecting?

The primary objective of strategic prospecting is to identify, qualify, and prioritize sales opportunities.
Strategic prospecting should involve the use of criteria that help the salesperson separate prospects who
are more likely to buy from prospects who are less likely to buy. In addition, strategic prospecting should

Answers and Discussions for Instructor’s Guide to accompany SELL, Second Canadian edition, Ingram/Shannahan 5-1
Copyright © 2016 by Nelson Education Ltd.
 have continuous improvement as a secondary objective. In other words, the salesperson should always
be looking for ways to improve the prospecting process.

3. Why is prospecting difficult for some salespeople?

Prospecting is difficult for some salespeople because it is a process filled with rejection. This is
problematic to some salespeople for a couple of reasons. First, many salespeople fear (or at least don’t
like) rejection. Second, because it is filled with rejection, many salespeople may feel that prospecting is an
inefficient use of their time. In either (or both) case(s) salespeople will find prospecting difficult because
they will not allocate resources necessary for making this process more effective.

4. What are the disadvantages of cold canvassing prospecting methods?

The primary disadvantages of prospecting are that it is inefficient and can have a detrimental impact on
the image of the salesperson. Cold canvassing is inefficient because of the low success rate. Salespeople
engaged in cold canvassing generally know little to nothing about the prospects, and therefore do not
have time to qualify them before calling them. The result is that salespeople may spend a great deal of
time calling on prospects who do not meet the qualifying criteria.

Cold canvassing can be detrimental to the image of salespeople because cold calls are unannounced. The
potential prospects may feel as though the salesperson is inconsiderate because he or she did not call to
make an appointment. In addition, the potential prospects may perceive the salesperson as unorganized
because the salesperson has little to no information about the buyer and did not make an appointment.

5. What are the basic criteria used to qualify leads as sales prospects?

Qualified sales prospects are leads who

• Can benefit from the sales offering

• Have the financial wherewithal to make the purchase, whether it is with cash, credit, or barter
capacity
• Plays an important role in the purchase decision process

6. What approaches can be used to prioritize sales prospects?

One approach is to create an ideal customer profile and then prioritize prospects based on their relative
match to the ideal. A second approach is to identify one or more criteria with which to evaluate and rank
prospects.

When prioritizing, salespeople may choose to rank prospects individually or in groups (e.g., A, B, and C
categories of prospects).

7. What are the major components of a strategic prospecting plan?

The major components of a strategic prospecting plan are

Answers and Discussions for Instructor’s Guide to accompany SELL, Second Canadian edition, Ingram/Shannahan 5-2
Copyright © 2016 by Nelson Education Ltd.
 • A method for establishing and tracking goals
• A system for allocating an appropriate amount of time to prospecting
• A method of tracking leads and prospects through the sales pipeline, and the relative costs associated
with acquiring the leads
• A method for evaluating the prospecting process
• A method for keeping the salesperson’s knowledge (competitor, customers, product) up-to-date

8. What types of information should salespeople gather to prepare for sales dialogue?

The salesperson should collect information about the prospect and the prospect’s organization. With
respect to the prospect, the salesperson should at least know (and how to pronounce correctly) the
prospect’s name and the prospect’s title. As the sales process progresses, the salesperson can learn
additional information about the prospect (e.g., hobbies, interests, and so forth), including the prospect’s
risk tolerance. The salesperson should also gather information about the prospect’s organization,
including the type of organization, the industry, the marketing channels in which it operates, their
competitors, and their customers.

9. How can salespeople use electronic networking as a prospecting method?

Salespeople can use electronic or social networking to enhance prospecting in a variety of ways. First,
social networking sites (e.g., LinkedIn and Plaxo) can help salespeople identify prospects, either directly
or through referrals. Second, salespeople can use social networking to learn about the prospect and the
prospect’s organization, either from the prospect’s social networking page, or from other members of the
social network who are familiar with the prospect.

10. What company sources can be used for prospecting?

Many organizations provide a variety of ways to help salespeople generate leads and identify sales
prospects. Those sources include company records, advertising inquiries, inbound telemarketing,
outbound telemarketing, trade shows, and seminars.

Video Exercise
1. Comment on the information that Lisa has collected on this potential customer before this first
meeting.

In addition to knowing the customer’s name, Lisa learned a couple of key pieces of information prior to
the meeting. First, she learned that the company is developing a new interactive racing game to be
released during the holiday season. This information is useful because the new product release carries
with it the need for additional security. Lisa also learned that the company is planning an expansion.
Again, this information suggests a need for additional security. Finally, Lisa determined the name of the
security system provider that Mark’s company is currently using. This allowed her the opportunity to
conduct a preliminary analysis of how her product compares with the product Mark is currently using.

Answers and Discussions for Instructor’s Guide to accompany SELL, Second Canadian edition, Ingram/Shannahan 5-3
Copyright © 2016 by Nelson Education Ltd.
2. Would it be appropriate for Lisa to ask for a referral after this first call? Why or why not?

Some students may believe it’s okay to ask for a referral after this call. However, Mark doesn’t really
know Lisa, and she hasn’t had the opportunity to demonstrate any real ability to add value. Consequently,
Mark is unlikely to provide Lisa any referrals and would likely perceive her asking as inappropriate.

Chapter 5 Continuing Case

Questions

1. What is Brenda doing wrong? What would you recommend Brenda do to improve her prospecting
efforts?

First, Brenda needs to develop a strategic prospecting plan that incorporates the elements discussed in
the text. Next she needs to assess her lead generation methods and qualifying criteria. It’s likely that she
is not getting good leads, and it is also likely that she is not doing a good job qualifying leads. Finally, I
would recommend Brenda work on generating referrals from her current satisfied customer base. Using
referrals is much more effective and efficient than cold calling.

2. Explain the strategic prospecting process to Brenda and discuss how she can implement it.

Students answers will vary but should include the elements of the strategic prospecting process,
including

• A method for establishing and tracking goals

• A system for allocating an appropriate amount of time to prospecting
• A method of tracking leads and prospects through the sales pipeline, and the relative costs associated
with acquiring the leads
• A method for evaluating the prospecting process
• A method for keeping the salesperson’s knowledge (competitor, customers, product) up-to-date

3. What secondary lead sources would you recommend Brenda use to identify the best attorneys,
architects, accountants, and medical professionals as prospects?

There are a variety of secondary lead sources available to Brenda. The first is the phone book (yellow
pages). This will give her a list of the various attorneys, architects, accountants, and medical professionals
along with basic contact information. She could also use Hoover’s, the NAICS Website, and other Web-
based lead search tools such as SalesGenie.com.

4. What specific types of information should Brenda obtain before contacting a qualified prospect?

At the very least, Brenda should know the name and title of the lead she is hoping to contact. She should
learn something about the prospect’s organization, including markets they serve, competitors, and any

Answers and Discussions for Instructor’s Guide to accompany SELL, Second Canadian edition, Ingram/Shannahan 5-4
Copyright © 2016 by Nelson Education Ltd.
 current external forces that may be affecting their business. She can use this information to help gain
access to the lead.

Answers and Discussions for Instructor’s Guide to accompany SELL, Second Canadian edition, Ingram/Shannahan 5-5
Copyright © 2016 by Nelson Education Ltd.