Assignment

On
Bachelor of Business Administration.
Session 2022-2025

Theories of Selling

Under the Guidance of: Submitted by:

Prof Fatehman Kaur Taranjot Singh
Subject: Roll No.
Advertising and sales management 244089
 Theories of Selling
The theories of selling emphasizes on "what to do" and "how to do"
rather than "why". There are four theories of selling such as:

1."AIDAS" theory

2."Right set of circumstances" theory

3."Buying-formula" theory

4."Behavioural equation" theory.

"AIDAS" theory and "Right set of circumstances" theory is seller ori-

ented. "Buying-formula" theory is buyer oriented and "Behavioral equa-
tion" theory emphasizes the buyer's decision process but also takes the
sales person's influence process into account.
 Theories of Selling
(AIDAS Theory)

Here's a detailed explanation of the AIDAS theory:

What is AIDAS Theory?

AIDAS is an acronym that stands for Attention, Interest, Desire, Action,

and Satisfaction. It's a widely used sales theory that outlines the steps in-
volved in making a sale.
Breakdown of AIDAS:

1. Attention (A): Grab the customer's attention by highlighting the ben-

efits and unique features of the product or service. This stage is all about
creating awareness and generating interest.
Example: A salesperson uses a catchy headline or an eye-catching visual
to grab the customer's attention.

2. Interest (I): Generate interest in the product or service by providing

more information and answering questions. This stage is all about build-
ing curiosity and creating a sense of need.

Example: A salesperson provides a detailed demonstration of the prod-

uct or service, highlighting its features and benefits.

3. Desire (D): Create desire for the product or service by emphasizing

its value and how it can solve the customer's problems. This stage is all
about building enthusiasm and creating a sense of want.

Example: A salesperson uses storytelling techniques to show how the

product or service has helped other customers achieve their goals.
4. Action (A): Encourage the customer to take action by making a pur-
chase or committing to a sale. This stage is all about creating a sense of
urgency and overcoming objections.
Example: A salesperson uses a limited-time offer or a special promotion
to encourage the customer to make a purchase.

5. Satisfaction (S): Ensure customer satisfaction by providing excellent

customer service, addressing concerns, and building a long-term rela-
tionship. This stage is all about creating loyalty and generating repeat
business.
Example: A salesperson follows up with the customer after the sale to
ensure they are satisfied with their purchase and addresses any concerns
they may have.

Key Takeaways:
- AIDAS is a structured approach to selling that helps salespeople navi-
gate the sales process.
- Each stage of AIDAS builds on the previous one, creating a logical
flow of events.
- Understanding and applying the AIDAS theory can help salespeople
close more deals and build stronger relationships with customers.
Advantages of AIDAS Theory:
- Provides a clear and structured approach to selling
- Helps salespeople understand the customer's needs and wants
- Encourages salespeople to build relationships with customers
- Increases the chances of closing a sale

Limitations of AIDAS Theory:

- May not be effective in all sales situations

- Requires salespeople to have strong communication and interpersonal
skills
- May not account for external factors that can influence the sales
process.
 Theories of Selling
(“Right Set of Circumstances” Theory)

The "Right Set of Circumstances" Theory, also known as the "Right Set
of Conditions" Theory, proposes that a sale can only be made when the
right set of circumstances comes together. This theory suggests that a
salesperson must be able to identify and capitalize on the right set of cir-
cumstances to make a sale.

Key Components of the "Right Set of Circumstances" Theory:

1. Customer Needs: The customer must have a genuine need for the
product or service.
2. Product/Service Availability: The product or service must be available
and accessible to the customer.
3. Salesperson's Skills: The salesperson must have the necessary skills,
knowledge, and expertise to effectively communicate the value of the
product or service.
4. Customer's Financial Ability: The customer must have the financial
ability to purchase the product or service.
5. Timing: The timing of the sales pitch must be right, taking into ac-
count factors such as the customer's current priorities and budget.

How the "Right Set of Circumstances" Theory Works:

1. Identify Customer Needs: The salesperson must identify the cus-
tomer's needs and wants.
2. Assess Product/Service Availability: The salesperson must ensure that
the product or service is available and accessible to the customer.
3. Evaluate Salesperson's Skills: The salesperson must evaluate their
own skills and knowledge to ensure they can effectively communicate
the value of the product or service.
4. Assess Customer's Financial Ability: The salesperson must assess the
customer's financial ability to purchase the product or service.
5. Determine Timing: The salesperson must determine the right timing
for the sales pitch.

Advantages of the "Right Set of Circumstances" Theory:

1. Helps Salespeople Identify Opportunities: The theory helps salespeo-
ple identify opportunities and capitalize on them.
2. Encourages Salespeople to Be Proactive: The theory encourages
salespeople to be proactive and take control of the sales process.
3. Improves Sales Effectiveness: The theory improves sales effective-
ness by ensuring that salespeople are prepared and able to capitalize on
opportunities.

Limitations of the "Right Set of Circumstances" Theory:

1. Overemphasis on Circumstances: The theory may overemphasize the
importance of circumstances and underestimate the role of salesperson's
skills and abilities.
2. Difficulty in Identifying Right Circumstances: It may be difficult for
salespeople to identify the right set of circumstances, especially in com-
plex sales situations.
3. Limited Control Over Circumstances: Salespeople may have limited
control over circumstances, such as customer needs and financial ability.
 Theories of Selling
(“Buying Formula” Theory)

The "Buying Formula" Theory, also known as the "Buying Decision

Formula", proposes that a customer's buying decision is influenced by a
combination of factors. The theory suggests that a salesperson can in-
crease the chances of making a sale by understanding and addressing
these factors.

Key Components of the "Buying Formula" Theory:

1. Needs: The customer's needs and wants.
2. Wants: The customer's desires and preferences.
3. Expectations: The customer's expectations from the product or ser-
vice.
4. Motivation: The customer's motivation to buy.
5. Ability: The customer's ability to buy.
The Buying Formula:
The Buying Formula is: Buying = (Needs + Wants + Expectations) x
(Motivation + Ability)
How the "Buying Formula" Theory Works:
1. Identify Customer Needs: The salesperson must identify the cus-
tomer's needs and wants.
2. Understand Customer Expectations: The salesperson must understand
the customer's expectations from the product or service.
3. Assess Customer Motivation: The salesperson must assess the cus-
tomer's motivation to buy.
4. Evaluate Customer Ability: The salesperson must evaluate the cus-
tomer's ability to buy.
5. Tailor Sales Approach: The salesperson must tailor their sales ap-
proach to address the customer's needs, wants, expectations, motivation,
and ability.

Advantages of the "Buying Formula" Theory:

1. Helps Salespeople Understand Customer Behavior: The theory helps
salespeople understand customer behavior and decision-making pro-
cesses.
2. Improves Sales Effectiveness: The theory improves sales effective-
ness by providing a structured approach to selling.
3. Enhances Customer Satisfaction: The theory enhances customer satis-
faction by ensuring that salespeople address customer needs and expec-
tations.
Limitations of the "Buying Formula" Theory:
1. Overemphasis on Customer Factors: The theory may overemphasize
the importance of customer factors and underestimate the role of sales-
person's skills and abilities.
2. Difficulty in Measuring Customer Factors: It may be difficult for
salespeople to measure customer factors such as motivation and ability.
3. Limited Control Over Customer Factors: Salespeople may have lim-
ited control over customer factors such as needs, wants, and expecta-
tions.
 Theories of Selling
(Behavioral equation" Theory)
The "Behavioral Equation" Theory, also known as the "Behavioral For-
mula", proposes that a customer's behavior is influenced by a combina-
tion of factors. The theory suggests that a salesperson can increase the
chances of making a sale by understanding and addressing these factors.

Key Components of the "Behavioral Equation" Theory:

1. Motivation (M): The customer's motivation to buy, driven by their
needs, wants, and desires.
2. Ability (A): The customer's ability to buy, influenced by factors such
as financial resources, authority, and access to information.
3. Environment (E): The external factors that influence the customer's
behavior, such as social norms, cultural values, and physical surround-
ings.

The Behavioral Equation:

The Behavioral Equation is: Behavior = Motivation x Ability x Environ-
ment
How the "Behavioural Equation" Theory Works:
1. Identify Customer Motivation: The salesperson must identify the cus-
tomer's motivation to buy, driven by their needs, wants, and desires.
2. Assess Customer Ability: The salesperson must assess the customer's
ability to buy, influenced by factors such as financial resources, author-
ity, and access to information.
3. Evaluate Environmental Factors: The salesperson must evaluate the
external factors that influence the customer's behaviour, such as social
norms, cultural values, and physical surroundings.
4. Tailor Sales Approach: The salesperson must tailor their sales ap-
proach to address the customer's motivation, ability, and environmental
factors.

Advantages of the "Behavioural Equation" Theory:

1. Helps Salespeople Understand Customer Behaviour: The theory helps
salespeople understand customer behaviour and decision-making pro-
cesses.
2. Improves Sales Effectiveness: The theory improves sales effective-
ness by providing a structured approach to selling.
3. Enhances Customer Satisfaction: The theory enhances customer satis-
faction by ensuring that salespeople address customer needs and expec-
tations.
Limitations of the "Behavioural Equation" Theory:
1. Overemphasis on Customer Factors: The theory may overemphasize
the importance of customer factors and underestimate the role of sales-
person's skills and abilities.
2. Difficulty in Measuring Customer Factors: It may be difficult for
salespeople to measure customer factors such as motivation and ability.
3. Limited Control Over Customer Factors: Salespeople may have lim-
ited control over customer factors such as environmental influences.