There has also been an increase in the total number of fixed lines within the UK, the total number has increased to £35.7 million during 2002. However, fixed telephony (calls and access) was stable at £13.1 billion, just under 40% of the end – user expenditure on telecom’s services. The majority of this growth was in the business market. The call volumes from fixed telephones grew by 18% during 2002, as there was an increase in dial – up Internet usage, whilst local call volumes was 18% lower within 2002.
The trends within the UK telecommunications industry has been influenced by external factors such as interest rates, inflation rates, unemployment and exchange rates.
An interest rate represents the price of borrowing money. UK interest rates have been left unchanged at 3.5% following the recent Bank of England rate – setting meeting in October 2003. This decision made by the bank was expected, as there has been a slight growth within the UK’s economy. A rise in interest rates will cause demand to fall, whilst a fall in interest rates will cause demand to rise. Businesses such as BT need a low interest rate environment in order for the business to survive/expand and maximize their sales within the telecommunications industry. The graph below shows the Bank of England base rate from July 2000 to October 2003, it shows that in July 2000 the base rate (this is the interest rate which the Bank of England charges banks when they need to borrow from it), was 6% and the continues to decline, as the present base rate is 3.5%.
An inflation rate is a sustained rise in prices, which is measured by Retail Prices Index (RPI). This looks at how the prices of a range of products, which people buy on a regular basis, change from month to month.
Within the UK, the inflation rates have decreased. RPI (Retail Index Price) and RPIX (Retail Prices Index excluding mortgage interest payments) inflation falls to 2.8%. The RPI inflation rate over the year to September 2003 was 2.8%, down from 2.9% in August. The Government’s target rate RPIX was also 2.8%, down from 2.9% in August. According to the internationally comparable measure of inflation, the UK’s HICP (Harmonised Index of Consumer Prices) inflation rate has been among the lowest in the European Union since the start of 2000. In a period of high inflation, rising prices are likely to affect everyone in one way or another. The impact of inflation on businesses such as BT can have many implications such as, the higher the rate of inflation, the harder it will be for BT to make plans for the future on how to maximize their sales. Inflation brings a variety of economic, social and business problems, which will intern cause, a rise in interest rates to slow it down. This will cause the economy to slow down. An increase in inflation rates will also affect the consumers buying decisions. Consumers will be more conscience about the amount they spend, as the prices of products and services have increased. The graph below shows the UK’s inflation rate between September 2001 to September 2003.
Unemployment has been counted by using the number of people who are claming benefit because they don’t have a job.
Within the UK, unemployment rates remains unchanged at 5.0%. Survey data for the three months ending in August showed a fall in the working age employment rate. Although there was no change in the unemployment rate, there was an increase in the average earnings. In September, the number of people claiming Jobseeker’s Allowance (the claiment count) was slightly lower. The labour market trend assessments this moth shows that the employment rate is levelling off, while the unemployment rate may still be falling slightly. The claimant count trend is also falling slightly. The growth in average earnings remains moderate. There was a rise of 13,000 full – time workers to 20.7 million, but a fall of 21,000 part – time workers to 7.2 million. When unemployment level is at a high level, the population as a whole has less money to spend, and this affects many firms and industries such as BT. As the population as a whole has less money to spend, BT will not be able to sell as much products and services as it did in the past. In order for BT to survive within the telecommunications industry, they would have to lower their prices to maintain their current market share and retain their customers. As BT is selling telecommunications products and services worldwide, they can raise additional capital, which will intern boost BT’s market share within the telecommunications industry and help to revitalize the UK’s economy, by opening more branches which will help to reduce unemployment rate within the UK. The graphs below show the unemployment rate from June 2001 – August 2003 and the working – age employment rate between June 2001 and August 2003.
The exchange rate is the rate at which one currency will exchange against other currencies. The exchange is important because it determines the price of UK goods abroad and the price of goods from abroad sold in the UK. A rise in exchange rates can have an unpleasant effect on the competitiveness of UK businesses such as BT. Businesses that sell their goods and services abroad will prefer the UK’s exchange rate to be low, as their products will be less expensive and more competitive. Whilst products form other foreign products such as Cable and Wireless products will be more expensive and less competitive.
These four external factor all have an effect on the business and the customers decision, especially unemployment and inflation rates. Unemployment and inflation rates are economic problems that have consequences for a large number of individuals and organization. Inflation tends to rise when the economy is booming and unemployment is falling, similarly, during recession, inflation is often falling and unemployment rising. However, a rise in inflation rates will also encourage a rise within interest rates. A rise in interest rates will attract an increase in the capital flow of within the economy, as foreign investors will switch from other currencies to sterling accounts, which pay high rates of interest. This means that the exchange rate will then rise and UK exports will be more expensive whilst imports will be less expensive. The ideal economic position for a business such as BT to survive within the telecommunications industry is for the UK to have a low rate of inflation, a steady rate of economic growth, low employment and a stable exchange rate.
Customers are the most important factor for nay organization to survive within its chosen industry. Without any customers a business will not be able to survive within its chosen industry. Customers are often exposed to various experiences and influences, which will affect their behaviour and decision when purchasing a product or service. There are certain factors, which influence the consumers’ buyer behaviour when purchasing a product or service. Consumer buyer behaviour is defined as: ‘The acts of individuals directly involved in obtaining and using goods and services, including the decision processes that precede and determine these acts.’
These are the different types of influences, which affect the consumer buyer behaviour: Cultural and Social Influences, Social Class, Reference Groups and the consumer as an individual as an individual. All these influences have a different effect on consumers’ buyer behaviour such as:
Cultural and Social Influences are been defined as culture shapes and influences ones behaviour. Culture is a state of manners, taste and intellectual development, that has been passed down through generations. In simpler terms culture is ‘learned’ behaviour that is passed down over time and is reinforced in our daily lives through the family unit and educational and religious institutions. Cultural influences concern unwritten laws about what is socially acceptable or appropriate in a given society.
Social class is a well-known social influence. Social class is used as one of the main theory used in market research, to identify consumer behaviour. Social class is an indicator of lifestyle and its existence portrays a strong influence on individual consumers.
Reference groups also play a more intimate role in influencing consumers. This is a group of people whose standards of behaviour influence a person’s attitude, opinions and values. In general people tend to imitate and seek form those closest to them. Reference groups can be small such a family group, or large such as within an organization. The smaller and intimate a reference group, the stronger its influence is likely to be.
The consumer as an individual may be one of the weakest influences, when influencing a consumer’s buyer behaviour. A wider environment where behaviour is influenced by cultural and social structures are much stronger influences. From the wider environment a person’s personality also develops that influences the decision of a consumer.
All these factors explained above all affect the decision of any consumer when purchasing a product or service. Within the UK, BT provides telecommunications goods and services to 20 million businesses and residential customers with more than 29 million exchange lines, as well as providing network services to other licensed operators. They also provide services to multi – site corporate and government customers in all key commercial centres of Europe, North America and Asia.
BT and its four main groups, BT Retail, BT Wholesale, BT Global Services and BT Openworld sells BT telecommunications goods and services to a wide range of customers within the UK and other parts of the world.
BT Retail provides telecommunications goods and services to residential and business customers and also to other BT businesses such as BT Wholesale. Residential customers will have a different influence from a business customer. A residential customer’s decision when purchasing a BT product or service e.g. social class and reference groups will influence Broadband. As these groups play a very important part in influencing consumers. Whilst a business who is a BT customer, will purchase a product or service which is more essential to the business rather than the individual. Therefore the business will be influenced by the price of the product, which has been offered to them.
BT Wholesale provides comprehensive network services within the UK to more than 500 communication companies and other BT businesses such as BT Global Services. The customers of BT Wholesale decision on whether or not to purchase their products or services will be influenced by the price of the product or services will be influenced by the price of the product or service, which is offered by BT to the business.
BT Global Services provides goods and services to customers worldwide. As this section of BT’s group provides goods and services on a worldwide scale, social class, reference groups and the price of the product will influence their customers’ decision. All these factors will affect the decision of the customers and a number of other factors including competition. As BT will be selling their product and services on a much larger scale, consumers will be very conscience about what they will be purchasing, as BT’s name may not be well established within the international telecommunications market.
BT Openworld provides Internet services to more then 1.7 million customers and businesses within the UK. The customers buying decision will be influenced by reference groups whilst, the business customer’s decision will be influenced by the price of the product or service provided by the company and its competitors.
A consumers’ buyer behaviour is influenced by many factors such as social class, but minority of the time it up to the consumer’s own decision whether or not to purchase a product or service.
Competition within any industry has many advantages and disadvantages. Advantages include customers can benefit as they would get to chose the best value for the lowest prices. The main disadvantage is that many companies may go out of business whilst others will gain control of their chosen market.
Within the telecommunications industry, BT has a significant market share for fixed network calls and provision calls. Competition has dilapidated BT’s market share, as it continues to increase within the telecommunications industry. As competition continues to increase BT’ market share, continues to decline. This means that the prices are much lower for consumers, whilst BT is usually its market share and customers. In order for BT to remain in business they should keep up with their competitors and keep up with the everyday needs of their customers.
The process of purchasing a product or service is not as simple as it might appear. A consumer does not usually make a purchase without thinking carefully about his or her requirements. Wherever there is a choice, decisions are made and these are influenced by complex motives such as the price of the product, the customers’ income, age distribution, competition within the industry and advertisement.
The most important factor that influences a customer to purchase a product is the price. When a customer is purchasing a product or service the is very essential as want to get the best value for their money. BT makes sure that the price of their products and services are reasonable, for all their different types of customers. BT offers a different price plan for all their customers, so that they can meet the needs of their potential and existing customers. They also so make sure that they sell their products and services at a lower price than their competitors, so that they can make a profit.
Income is also an important factor, which influences the customers’ decision when purchasing a product or service. The more the income people have, the easier it is for them to purchase a product or service. The amount of income people have to spend on goods is known as their disposable income (their pay minus taxes and other essential deductions). On average income tend to rise over time, and this will lead to a general increase in the demand for goods. An increase in income for individual (e.g. BT customers) will mean that more money will be spent on better goods/services. So, BT will introduce new sales strategies so that they can attract new customers and will also encourage their existing customers to spend more.
Age is also an important factor for many products, as it only appeals to some age group more than others. Businesses need to be keenly aware of changes taking place in the numbers in different age segments, so they can know where there best opportunities lie. For example, BT has launched a new product BT Broadband. This product attracts potential and existing customers that use the Internet on a regular basis.
Advertisement is one of the most effective ways of attracting potential and existing customers. Producers and sellers will often seek to manipulate demands through advertising and other promotional techniques. For BT, advertising is an important cost of production, because it has helped the business tremendously when advertising their new product BT Broadband. The advertisement has helped BT to gain many new customers and has slowly helped them to regain a firm hold within the telecommunications market.
The demand for products, which have close substitutes, will often be strongly influenced by the price of other substitutes. This would be the case for BT, as there is a wide range of telecommunications companies within the UK e.g. Ntl and Telewest, which offer similar services and products as BT. The rate of competition will be difficult as every company within the telecommunications industry will be competing to be leaders of the telecommunications industry and most importantly to be first choice for potential and existing customers.
These five main factors, the price of the product, competition within the industry, the customer’s income, advertisement and age distribution, all influence the demand for a product. In order for BT to retain their current market share within the telecommunications industry they need to meet the demands of their customers.
An organisations’ buyer behaviour is much different from a consumers’ buyer behaviour. A consumer’s buyer behaviour when buying a product is more concerned with luxury rather than it been essential. However, an industrial purchaser cannot afford the luxury of impulse buying. They are employed to make purchases for a specific reason. The major difference between consumer and organizational buying decision is that the concluding decision usually involves a group. Individuals within the group all have different roles in the purchasing process, this is known as the Decision Making Unit (DMU).
Within the DMU, there are several people within the group, which influences the organisation’s decision these include:
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Users: These are the people who work with or use the product and may involved in product specification.
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Buyers: They have the authority to sign orders and make purchases. Their main role is supplier negotiation and selection.
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Deciders: These are the people who make the buying decision.
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Influencers: They can affect the buying decision in different ways e.g. technical people may have helped in some way to develop the product specification.
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Gatekeepers: They control the flow of information to and from people who buy form the company.
Organisational buyers’ roles vary widely according the complexity, size and structure of the company. There are certain factors, which influence the organizational buyer such as press advertising, direct mail, sales literature, demonstrations etc. Within an organizational market, buyers and sellers do communicate through media, but rely profoundly on personal communication. Organizational buyers work to maintain the satisfaction for the company’s ‘physical’ needs.
Task 4 – e3
Every organisation will need to acquire, use and change factors of production in order to produce goods or provide services. The factors of production are the inputs that an organisation uses. These factors must be combined in the most efficient way for the organisation to achieve its objectives. To do this, the business has to carry out a range of functions. Within a typical organization there are six functional areas; Finance Department, Production Department, Human Resource Department, Marketing and Sales Department, Administration Department and The Research and Development Department.
Within a business that sells a product or service, a strategy is necessary when developing a new or existing product. However, to come up with this strategy, the organisation needs to consult its marketing and sales department. Marketing is involved with satisfying the customers’ needs at the right price. It means researching what the customer wants, and investigating how the business can satisfy that need. Selling, on the other, involves persuading the customer to buy the products the business has already produced.
Within a business the sales function will co-ordinate the selling programme, using a variety of techniques i.e. travelling sales representative, telephone sales, mail shots and a follow-up schedule. Within the marketing and sales department, a sales person is often employed to sell complex industrial equipment. Today, it is more usual for a sales person to visit the customer, rather than the other way round. A sales person knows the market; keeps in touch with the customers and make suggestions that help to result in new sales opportunities.
Within BT, the primary role of a sales person is to make sales to modern marketing orientated sales persons. One of the main responsibilities of a sales person is to convert a potential customer into an actual customer. This is done through a mixture of:
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Good product knowledge: When selling a BT product or service to a potential or existing customer, the sales person has to have knowledgeable understanding of the product or service offered by BT. This makes it much easier to sell a product or service of high quality and value for money. If a BT sales person has insufficient knowledge about a BT product or service, which they are trying to sell to an existing or potential customer, they can lose a customer. So having a basic knowledge about a product or service is important to a BT sales person, as it influences the buying decision of the customer.
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A sincere interest in the customers’ particular needs: People are more willing to purchase a product or service if the sales person is friendly, approachable, lively and interested in them. When BT sales person is introducing a new product to an existing or potential customer, the following skills are required to they intend to sell a product.
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Servicing: The salesperson within BT, provides services to customer’s i.e. technical advice, after – sale service etc. These services, which have been provided by the BT sales person has enabled BT to increase the number of satisfied customer. The table below shows the results for the last three months of the 2003 financial year amongst BT Retail customers, who are satisfied with the overall provision of the services or service repair done which was carried out by BT;
The table above is an excellent example of how the BT sales person, has helped the customers with their technical problems. These results will enable the sales person to analyse customer preferences and requirements, which will then enable the sales person to use the information to forecast what information is vital to marketing planning.
The skills and qualities which are required by a typical sales person, when they are selling a product or service, good product knowledge, excellent communication skills, a persuasive manner and a sincere interest in the customer’s particular needs i.e. excellent quality. Customers are more tempted to purchase a product or service if the sales person is friendly, approachable, lively, interested in them, hard-working and knowledgeable. This gives the customers confidence in the sales person’s judgement and advice about a specific product or service. The sales person at BT has to have all the following skills and qualities listed above including self-confidence. The skills and qualities stated above are required by the BT sales person, especially self-confidence, as it enables the fellow members of staff to have confidence in the sales person and the product. It is also much easier if the BT sales person has the following skills as it id much easier to sell a BT product or service at a high quality and value for money, better than the competitors within the telecommunications industry.
Every employee has a formal job role, which determines the jobs, and tasks which they are expected to perform. The content of a job is usually specified in a job description. This outlines basic information about the job itself and/or the role of the employee. A job description is, therefore, only a guideline. A ‘typical’ sales person is difficult to define. However, the job itself, and the person most suited for the job, can vary according to the product or service being sold. A typical outline of a job description for a sales person will include the following requirements:
- Age and marital status
- Interest/hobbies
- Education
- Previous employment and experience
- Location
- References
All the above criteria’s, which have been stated above, are essential during the recruitment for a new sales person.
During the recruitment of a new member of staff i.e. a new salesperson, a CV must be sent in by the interested in the job, in order for them to obtain a job placement. Their CV must therefore provide the company with the following information:
- A well-structured piece with relevant information about yourself, which can be read quickly.
- Details of your key skills e.g. ICT skills (Microsoft Excel).
- A summary of your relevant experiences e.g. previous employment i.e. Safeways
- A summary of relevant achievements e.g. GCSE’s
- A positive and realistic summary of your potential value to the company and your acquired job i.e. I have experience working in customer service, therefore I can deal with customer’s problems and quires effectively.
- Education i.e. school you attended.
- Any other information, which is likely to support your application i.e. whilst at university I worked within a team, which designed, implemented and managed an office automation project in association with a local company.
The requirements stated above applies to any job, which a person is applying for within BT.
Task 7 – e5
Within a business that sells a product or service, a strategy is necessary when developing a new or existing product. However, to come up with this strategy, the organisation needs to consult its marketing and sales department. Marketing is involved with satisfying the customers’ needs at the right price. It means researching what the customer wants, and investigating how the business can satisfy that need. Selling, on the other, involves persuading the customer to buy the products the business has already produced.
The general plan used for all sales interviews is called the ‘sales sequence’. It should be flexible and capable of being adapted to suit individual situations. The general sales sequence is a guide, and this format is adapted to suit individuals’ situations. The general sales sequence is a guide, and professional salespeople adopt this format. Listening skills are vital so that a salesperson can interpret verbal and non-verbal clues and adjust the message and approach to fit the requirements of the particular situation. The following format is a general plan for this sequence:
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Preparation: planning of individual interviews.
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The approach: the way the salesperson meets and greets the customers.
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The presentation and/or demonstration: normally the central part of the sales interview and an appropriate time for the salesperson to emphasise product benefits.
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Negotiation: deciding delivery dates, price, credit terms, etc.
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Closing: the final bringing together of what has been discussed and agreed, and the time when a possible order can be discussed and agreed, and the time when a possible order can be discussed.
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Follow-up: an important element of good customer relations is an efficient after-sales service that is not merely technical support, but part of customer relations management (CRM), also referred to as Key Account Management (KAM) that is company-wide.
Preparation
Whether the organisation is profit motivated or income maximising, its relationship with its customers/clients must be such that, the company will keep attracting new and existing customers. Moreover, if a BT salesperson is planning to sell a product or service i.e. BT Broadband to a BT customer, the salesperson must have a general and personal knowledge about existing customer, so that they can retain existing customers whilst attracting new customers. In order to so this, a BT salesperson must consider the following points:
- Company knowledge – This includes familiarity with the company’s systems, procedures, price, terms and policy on complaints and returned goods. A BT salesperson is required to know sufficient knowledge about the company, as impressions of the organisation may actually begin with stories in the press or television, which might influence the decision of the customer. Therefore the BT salesperson needs to be updated on a regular basis, e.g. BT may extend credit terms, and therefore it is important that the BT salesperson knows about this immediately.
- Product knowledge - This includes information about the company’s existing and new products. This means that the BT salesperson’s knowledge of BT’s product range, or main aims are crucial. The BT salesperson needs to give reasons why BT’s product offers more of the benefits they seek, because making exaggerated claims can lead to customer dissatisfaction. For example. BT Broadband high-speed connection enables users to access websites, download music, and watch movies etc. whilst you speak on the telephone all faster than before. This information can be misleading to customers, as there are no statistics and evidence to back-up the information, which has been stated.
- Market knowledge – This is an understanding of the general state of the market including, new developments in the market and between competitors. A BT salesperson will need to know sufficient information about the current state of BTs position within the telecommunications market and also the competitors within the telecommunications market. This information is necessary, as it enable the salesperson to learn about the BT’s competitors and the products and services which are been offered by the other telecommunications companies so the develop new strategies to attract new and existing customers. For example, BT Broadband is BT’s latest service offered by BT. With sufficient knowledge about the company’s new product, the salesperson can develop a sales strategy with their sales team, which will enable BT to attract new customers.
- Customer knowledge - This is need about the size of the company, affiliation to other companies, their bargaining power and markets they serve.
- Buyer knowledge - This is needed at a personal level, which may include knowledge of the buyer’s family circumstances – perhaps picked up at the last sales interview e.g. at the buyer’s wedding anniversary that can provide a caring personal touch. Customer family details and special interests are useful. This provides good background information that can be used to break the ice.
Approach
The way the salesperson approaches a prospective customer is a basic skill. To evaluate a situation quickly and judge the mood and personality of the prospect are valuable skills. Some pointers are:
- First impressions are important and the salesperson should be prepared, alert and well groomed in the context of not dressing or behaving in an extreme manner.
- The opening of the sales interview should be pleasant and businesslike. This is important if it is the first interview. In such a situation, opening remarks are critical as this is where first impressions are gained.
- Business at hand should be discussed as soon as possible to avoid wasting selling and prospecting time, but clearly the salesperson is regulated by the buyer.
- Relevant questions should be asked as well as actively listening to answers.
- If a further appointment is made, this should be asked as well s actively listening to answers.
The presentation and /or demonstration
This stage depends on good foundations. The salesperson should have a clear idea of the buyer’s requirements and have established the level of explanation required. During a sales presentation/demonstration, the role of the salesperson is to communicate specific benefits of interest to a potential customer about a specific product or service. Products or services have many features, and ‘customers buy benefits, not features’. Therefore, a salesperson should examine the needs of the potential customers and target them, during the presentation.
During a sales presentation/demonstration, a BT salesperson should examine the product or service range, listing the major selling points for each product or service, e.g. Bt Broadband. The presentation will include the following details about broadband:
- Customers can talk and surf at the same time on the same line.
- Customers can instantly access the Internet whenever they like.
- Customers can stay in touch at all times.
- Customers can send and receive attachments more easily via e-mail.
- Customers can view web content up to ten times faster than before.
The points stated above are important selling points about BT Broadband. These points will enable the salesperson to identify the needs of the customers during the presentation stage, so that they can be targeted during the presentation.
A good sales presentation can help a salesperson overcome objections. If the sales presentation is carried out on an interactive basis, the salesperson may even find it advantageous to encourage objectives, in the knowledge that they can be dealt with adequately. In order for a gain a sale, he/she should refer to the needs of the customers in the relation to the product or service, at a level of technicality that the presentation/demonstration can be readily understood.
Negotiation
Sales negotiation is a process of presentation, evaluation, counter-proposal and concession, concerning two parties who wish to bring about an agreement that is acceptable to both parties. The seller typically makes a sales presentation/demonstration, which will outline the price, credit, and delivery etc. of the specified product or service. The buyer will therefore evaluate these points, to see if they meet their requirements.
During a sales negotiation between a BT salesperson and a customer about a specific product or service, i.e. BT Broadband. The salesperson provides the customer with clear and accurate information, which must be evident in the form of the product brochures and helpful, well-informed staff. The information will also include details, if a customer requires a refund on the product/service, or goods need exchanging, help is been provided by BT Customer Service with minimum fuss. The customer will then consider the offer and make a decision. Moreover, each party has an optimal result in mind, but concedes that the achievement of this goal is rarely possible and they must be prepared to compromise.
Closing
The objective of selling is to obtain an order, therefore closing techniques should be understood as well as when and under what circumstances each is applicable. These techniques can ensure that a decision to but does not get reversed at the last moment. These techniques includes:
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Basic Close is when the salesperson identifies buying signals from the prospects and starts to fill in order forms. If there are no objectives, a sale is achieved.
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Alternative Choice is a trail close technique. When the salesperson has received buying signals from the prospect, an attempt is made to close the deal by offering the customer an alternative choice.
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Firms who offer new equipments free for a ‘trail period’ often use The Puppy Dog technique. It is then hoped that the customer will get used to having the product and at the end of the trail there may be resistance to return it, as well as the potential for more orders.
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Summary Questions is used when the salesperson experiences resistance. The main cause of resistance is been discovered through elimination, e.g.
‘Is it the price?’ ‘No!’
‘Is it the colour?’ ‘No!’
Each time the customer says ‘No’, a potential cause of resistance has been
Eliminated. This allows the salesperson to concentrate on the most important area of
Resistance.
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Similar Situation is best illustrated by an example of s salesperson selling security devices. Upon meeting resistance, the salesperson could point to a similar situation: ‘The Henry family in Meadowbrook said exactly the same as you. They thought it was expensive and wanted more time to think. One week later they were burgled!’ This technique can be powerful in influencing a customer’s decision, especially if related to an analogy.
During the closing stage of a sales process, a BT salesperson usually uses the ‘The Puppy Dog technique’, for a product such as broadband, otherwise the salesperson would use another technique depending on the product or service, i.e. Summary Questions are usually used by a BT salesperson, when they are trying to persuade a customer over the telephone usually about updating their current price plan. The puppy dog technique would be the most effective closing technique when selling broadband to a potential customer, as it enables the customer to experience the product first hand and will therefore feel more confident in their decision to purchase the product. These techniques are not exhaustive, but a BT salesperson is required to know which one to use in a given situation.
Follow-up
Follow-up service is an essential element of customer service in any type of organisation. It is part of a salesperson’s task to provide information and advice after the sale. This might involve persuading the customer to take out a service contract and provide information about service centres.
When selling broadband, BT must ensure adequate back-up services to cover things such as spare parts, servicing, technical advice, replacements of faulty equipments etc. Any business, which does not offer after-sales services will quickly lose out to competition.
In order for BT to be able to respond to a constantly changing environment, the company must collect information on which it can base its decisions on. Market research does not produce answers during a decision-making process, market research can only produce information that may assist the company during their decision-making process. Market research are now been more widely used by many more organisation over the last years as:
- Markets have become larger, with national replacing local markets and European-wide markets replacing national ones as the basis on which products are launched. Larger markets mean greater risk, which can be reduced by having greater access to information. Within the telecommunications market, there has been an increase in the number of competitors. Therefore market research will be essential for BT as it assists and enables the company to plan how to retain their current hold within the telecommunications industry.
- In some cases, technology and the development of economics of scale has increased the threshold at which a new product can be launched into a market; for example, the launch of BT Broadband was nationwide, due to advertisement over the Internet, which attracted customers to purchase the product.
- The environment in which a company operates is changing operates is changing at an increasing rapid rate.
There are two basic types of basis market research which is usually carried out by companies, secondary or desk research, and primary or field research.
When BT is carrying out market research, they would normally start with secondary research, so that they can identify the current trends within the telecommunication market. Information can be obtained for market research from the website .
Secondary research is data, which has been collected by someone else for a purpose and has been used by another person for another purpose, other than what the data was originally collected for, e.g. annual company report, government statistics. BT normally starts with secondary research rather than primary research, as it is information which already and will provide the BT with information about the current trends within the telecommunications market and their competitors.
The benefits of BT using secondary research are that, the cost is relatively low and it saves time, as the data already exists. Secondary research is also one of the easiest ways to monitor changes occurring within the telecommunications market over a period of time e.g. government sources such as the Office of National Statistics (ONS). The main advantage is that secondary research is available from more than one source i.e. libraries or the Internet, which gives the researcher a bigger sample size. There are also disadvantages when using secondary data such as some of the data available may be out dated. Secondary data does not reveal individual values, beliefs, or reason that may affect current trends within a market e.g. The current trend within the mobile industry. Another main disadvantage is that it is difficult to determine how reliable the data is, as the can be made up.
If secondary research does not yield sufficient information for BT’s market research, the company must then turn to the relatively expensive primary data collection. Primary research is data that doesn’t already exist and is sometimes referred to a field research. BT’s often undertakes primary research market researchers, as it is first hand information and will provide the researchers with the precise information, which they require about a specific product or service. However, there are disadvantages when acquiring the precise information about a product or service, as primary research takes more time than secondary research and less people are more willing to participate, when primary research is been carried out. Moreover, the type of market research that is been carried out by BT’s Research and Development Department solely depends on the type of product or service, which is to be launched by the company.
Task 9
In any society, the complex interrelation between legally responsible parties such as people and companies need to be regulated. Therefore legal matters, which affect the business and other organisations, should be considered an essential part of the political environment. Legal constraints are essential to an individual and within an organisation, as they:
- Permit individuals to engage in lawful activities without apprehension or molestation by others.
- They restrict unlawful or otherwise disturbing individuals and behaviour.
- They constrain individuals to comply with legally required activities, such as the payment of taxes.
Consumer law is first and foremost designed to protect the interests of consumers of products and services against the unfair actions of business, in making transactions. The following laws affect the sales of goods and services within BT. These include:
- Sales of Goods Act 1979
- Supply of Goods Act 1973
- Data Protection Act 1984
- Supply of Goods and Services Act 1982
- Sales and Supply of Goods Act 1994
Sales of Goods Act 1979
In England and Wales the sales of goods is governed by the Sale of Goods Act 1979 (as amended by the Sale and Supply of Goods Act 1994 and the Sale of Goods (Amendment) Act 1995 ("SGA 1979"). This act is a contract by which the seller transfers or agrees to transfer the property in goods to the buyer for a money consideration, called the price. This Act protects consumers by imposing restrictions upon the contracts of sale used by sellers. This Act imposes three conditions of sale upon all sellers including BT. These conditions states:
- That the goods sold must match the description of the goods presented to the consumer.
- That the goods supplied must be of ‘satisfactory quality’.
- That the goods supplied must be fit for purpose indicated to the consumer by the seller.
When a good or service is being sold, there are certain requirements, which the customer and retailer i.e. BT must comply with. These include:
Retailer’s (BT’s) Requirements
- To transfer the possession of goods to the customer, by delivering the goods or services according to the terms of the contract, i.e. At a Bt’s retail outlet at a reasonable time.
- Retailers are required to sell satisfactory quality goods, which are suitable for the purpose that they were purchased for.
- Retailers are required to sell goods, which correspond with their description or the sample used.
Consumer Requirements
If the seller fails to comply with the requirements of the Act, either those expressly stated or implied by law, the consumer would have a right to an alternative. The alternatives available are outlined below. These have been provided by a commercial guarantee or warranties. These regulations have are implied in all consumer contracts and the sellers may not exempt themselves from any of these regulations.
- The consumer has the right to terminate and reject contract.
- The consumer has the right not to purchase the goods if they are damaged.
Therefore, if the telecommunications goods sold by BT, are not of merchantable quality, as described in the Act, Bt has failed to discharge their side of the contract, thus releasing the buyer from obligation.
Supply of Goods Act 1973
The Act makes provisions regarding hire purchase, letting and sale agreements. It also makes provisions regarding the description of goods to be sold and the responsibilities of suppliers in this area. The quality and fitness of goods sold, related to their purpose is also addressed. The exclusion of implied terms and conditions is dealt with and special provisions are made regarding conditional sale agreements.
Data Protection Act 1984
This Act was passed to prevent the misuse of personal data and to it causing harm to individuals. The Act only applies to ‘automatically process information’, not to information that is held and processed manually. Data users such as BT, have to be registered as a data user. By supplying information about the types of data held, their purpose, where they are obtained and to whom they will be disclosed.
The Data Protection Registrar maintains the register of data users, promotes compliance with data protection principles, considers complaints about breaches of the principles and, where necessary, prosecutes offenders.
The Data Protection Act affects businesses and individuals within BT, in a number of both positive and negative ways. On a positive note, the Data Protection Act encourages businesses such as BT, to hold accurate information in which may then be sold to other organisations thus, providing a potential source of income. On the other hand, meeting the needs of the Act is expensive, e.g. the costs of employing a data protection officer to monitor and control the data input system and the time taken to oversee any additions, deletions and use of the information.
Supply of Goods and Services Act 1982
In this Act in its application to England and Wales and Northern Ireland a “contract for the transfer of goods” means a contract under which one person transfers or agrees to transfer to another the property in goods, other than an excepted contract. This means that the consumers of services e.g. house and car repair have the same rights as consumers of goods.
Sale and Supply of Goods Act 1994
Definitions of quality made under the Sale of Goods Act 1979 are strengthened and clarified to be brought into closer line with European legislation. Hire purchase agreements and the leasing of goods are also covered. Fresh provision is made for the right of partial rejection by the consumer and with regard to the opportunity to examine the goods before a contract is finalised. The concept of acceptance is more clearly defined than under previous legislation, to the advantage of the consumer.
This Act is to amend the law relating to the sale of goods. When a BT telecommunications good e.g. mobile phone is being sold to a customer. BT has to make provision as to the terms to be implied in certain agreements for the transfer of property in or the hire of goods, in hire-purchase agreements and on the exchange of goods for trading stamps and as to the remedies for breach of the terms of such agreements and for connected purposes.
