The Exchange Behaviour Framework

One of my favourite readings for my Product Development and Commercialization was the first chapter of the book Exchange Behavior in Selling and Sales Management by Peng Sheng, Aziz Guergachi. This publication goes over a framework made up of 8 fundamental building blocks for the successful operation of selling and sales management. I thought it would be worthwhile to write a post explaining this framework, as it encompasses the art of making sales in a comprehensive manner.

To start, the 1+7 building blocks detailed in it are:

1. Phases of Purchase Process (PPP)
2. Views on Criteria
3. Key Person and Core Opinion Leaders
4. Buying Points and Selling Points
5. Deliverability and Integrated Products
6. Appropriate Communicators and Networked Resources
7. Selling Status Indices
8. Dealing with Competition

The first building block outlines the 5 phases potential buyers go through when making a purchasing decision, and can apply to smaller purchases like a roll of toilet paper, to industrial equipment costing millions of dollars. First, the need must emerge, such through the recognition that equipment in a company must be updated for new products. Needs would be defined, as the criteria would be set for the purchase. Selective qualifying is the selection of potential sellers, based on the Views on Criteria (explained below). The pros and cons of each potential seller are evaluated, and a choice is made. After follow-up of the choice made, the knowledge base of the customer is expanded. If there is Default Value Behaviour set for a customer, then the selecting qualifying would be skipped.

The second building block is Key Persons and Core Opinion Leaders. Key Persons are the ones with the authority over money spending and product selection and play an important role in the purchasing process as detailed in the description on the first building block. Core Opinion Leaders

Views on Criteria can be broken down into the selecting points and selecting rationales for the customers, and is applied to the expressed and implied attitudes and beliefs of the customers. The selecting points are the specific characteristics of a product, while the selecting rationale is the rationale for that selecting points being appealing to a buyer. Both are necessary for the purchase.

Buying Points and Selling Points enable the motion for a purchase to be made, and are based on two important points about human psychology. First, human beings are selfish. The buying points of a purchase are what will make purchases to make life better and or easier for them. Secondly, human beings are social creatures. The selling points are what enables a buyer to justify the purchase to other people, which satisfies the social needs. Buying points and selling points may be distinct, or could even overlap or be identical.

Beyond the basic product, there are additional features which contribute to the buying and selling points of the product, and address any risks or uncertainties a buyer may have with the potential purchase. Hence, the fifth building block is the Integrated Product. An example would be the purchase of a puppy, and the concerns with training the puppy. The dog salesperson could include several weeks of dog training, to convince the buyer that the sale would be a worthwhile one.

The sixth building block is how the selling points and selling rationale are communicated to key people. In many cases, other salespersons will need to be brought in to communicate specific buying and selling points, such as more technical aspects. Networked resources are external, which can also help with this, and can include referral sales.

Selling Status Indices are used to judge the progress of a sale. There are three indices identified in the Exchange Behaviour framework. The relating status index gives an indication of the comfort level the key person has during the purchase process, ranging from the critical stage where the key person is silent, to the partner stage where the key person is willing to share relevant and even possibly confidential information. The attitude index gives an indication of the buyer’s attraction to the buying points, with the confidence index being the attitude toward the selling points.

Lastly, competition ties in all the factors for attaining a competitive advantage. The Exchange Behaviour framework specifically defines competition as being that which impedes sales. A competitive advantage could be achieved if the impedances to sales are understood.