Abstract
Relationship selling is a strategy of attracting suitable consumers and then establishing, sustaining, and strengthening relationships with them to achieve long-term satisfaction through mutually beneficial partnerships. For a firm to remain competitive over time, it must ensure its strategies are difficult for competitors to duplicate. Thus, relationship selling is leveraged as a tool for achieving sustainable competitive advantage. In today's competitive environment, customer relationships are expected; hence, the establishment and development of relationship metrics is not an anomaly within successful sales organizations. With product quality becoming a universal standard and no longer a major source of competitive advantage, firms are striving to escape the quagmire of the “commodity mentality” that has pervaded the market today. To differentiate themselves, a number of these companies are resorting to relationship selling. This chapter focuses on understanding relationship selling, its components, and processes, as well as how it contributes to sustainable competitive advantage.
TopIntroduction
The relationship between the buyer and the salesperson is a major component of many relationship marketing initiatives. This is especially true for services like insurance, stocks, and trusts, as well as many B2B scenarios where the salesman is a key component of the company's marketing plan. When long-term partnerships are desired, salespeople should approach the situation from a relationship-selling perspective. Relationship selling and negotiation concepts have traditionally been considered from a transactional perspective, to assist marketers in closing a specific deal with a customer (Kotler, 2014). Selling can also be approached from the perspective of a relationship. “The seller who understands how to create and manage great connections with major customers will have plenty of future sales from these consumers”(Kotler, 2014). Relationship selling is proven to be successful for a number of businesses utilizing it. For example, Dupont devotes a significant portion of its sales training to teaching its salespeople the value of forming customer relationships as well as the techniques for doing so (Dupont Turns Scientists into Salespeople, 1987).
Relationship selling is a vital component in firms' efforts to achieve organizational success based on customer satisfaction, loyalty, and profitable sales volume in today's highly competitive market (Guenzi & Paparoidamis 2009). Due the rise of partnership period, current changes in the buyer-seller relationship have a substantial impact on how relationship selling and sales management are handled (Todd et al., 2010). These significant changes have evolved into a new relationship sales paradigm, in which salespeople serve as partners and value providers for customers, as well as market analysts and planners. The fundamental goal of relationship orientation is to build a long-term, mutually beneficial, and profitable relationship based on trust. Using relationship selling strategies is one approach to set sales pitch distinct from competitors. A relationship-based sales technique can increase a company's success rate with new consumers while also assisting in the retention of existing customers leading firms to continually look beyond what they sell to concentrate on their consumers' needs and interests to create relationships with them. Relationship selling's long-term goal is to boost return on investment (ROI) by cultivating brand loyalty, which contributes to a better customer lifetime value (Dandis et al., 2021). Firms nurture and retain additional customers by spending more effort and time into investigating prospects and their requirements and giving value through a variety of interactions resulting in superior outcomes. Along with stressing performance indicators that indicate relationship selling performance, sales managers need also offer realistic tricks and tips that their teams may employ to alter engagement techniques towards a relationship- centric strategy. With today's market's heightened competitiveness and higher product and service complexity, a relationship strategy that prioritizes the lifetime customer is required (Munoz & Mallin, 2019).
Key Terms in this Chapter
Brand Loyalty: Customer's favourable emotions toward a brand and their commitment to choosing to buy a brand's goods or services on a regular basis, irrespective of competitive pressures.
Prospects: A possible customer who has been qualified by a firm premised on its business offerings as meeting specific requirements.
Innovation: The hands-on application of ideas that results in the development of novel products or services, or an enhancement in the provision of those goods or services.
Salesperson: Someone whose duty it is to sell goods or services.
Transactional Selling: The method of performing one-off, often impersonal sales in which the primary goal is to generate revenue.
Relationship Selling: A sales approach in which a salesperson prioritizes their relationship with customers above other considerations. They normally gain confidence by providing value and investing a significant amount of time with prospects prior to closing.