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Richard G. McFarland, PhD

Now more than ever, clients expect a uniquely tailored experience and product. For this reason, adaptive selling is widely advocated to improve sales performance, job satisfaction, and customer satisfaction with salespeople. Adaptive selling is one of the most important areas of marketing research to date and is consistent with customer-centric marketing concepts.

Stock image of senior asian couple meeting with realtor, who is showing them a piece of paperReal estate agents frequently act on adaptive theory techniques, such as adjusting their approach with clients based on feedback received, the sales situation, and the customer to whom the agent is selling. The purpose of this article is to build upon already utilized aspects of adaptive selling while increasing a real estate agent’s understanding of adaptive selling and providing recommendations to further hone these techniques.

About This Study

Adaptive selling is defined as “the altering of sales behaviors during a customer interaction or across customer interactions based on perceived information about the nature of the selling situation or differences in buyers.”1 Professor Barton Weitz and his colleagues completed the foundational research on adaptive selling theory and conceptualized the model at both macro and micro levels. Most research after this point was focused on macro-level adaptive selling. 

This research adds to previous research by, most importantly, providing guidelines on possible measurement strategies for micro-level adaptive selling. This study also provides examples of what actions should be categorized in each of Weitz’s five steps (ISTEA model) of micro-level selling and postulates research questions for further study and reviews ADAPTS (the five specific steps of the adaptive selling process) macro-level measuring dimensions.

Macro-Level Adaptive Selling

Macro-level adaptive selling research treats adaptive selling as a single construct focusing on the abstract nature of the theory and the role of knowledge to categorize situations and what to do in each situation. Macro-level adaptive selling is measured using the ADAPTS scale based on theoretical backgrounds, including knowledge structure theory and self-presentation/self-monitoring theory. Note that ADAPTS does not measure specific behaviors or whether adaptations were appropriate for the situation. Instead, ADAPTS measures the level of adaptive selling by a salesperson and answers the question of whether a salesperson is practicing adaptive selling. Adaptive selling can be improved on a macro level through training, motivation, and leadership.

To accurately review whether a real estate agent is using adaptive selling techniques at the macro level, we suggest measuring responses to the following five statements:

  • When I feel that my sales approach is not working, I can easily change to another approach.
  • I like to experiment with different sales approaches.
  • I am very flexible in the selling approach I use.
  • I can easily use a wide variety of selling approaches.
  • I try to understand how one customer differs from one another.

Micro-Level Adaptive Selling

In 1978, Weitz argued that to be a successful salesperson one must recognize and adapt to specific customer needs and buying situations. A salesperson’s ability to influence customers is related to his/her ability to perform the following activities: (1) develop impressions, (2) formulate strategies, (3) transmit messages, (4) evaluate responses to those messages, and (5) make appropriate adjustments. Breaking down adaptive selling into these five parts is extremely difficult and makes measuring the application of adaptive selling increasingly difficult.

Real Estate Implications

The micro-level adaptive selling ISTEA multi-stage model outlines the practice of adaptive selling as a dynamic process occurring over these five stages (see recommended reading for more specific measurement techniques):

Impression formation stage is the first step in micro-level adaptive selling and takes place when a seller first forms an impression of the customer (customer characteristics, their needs, purchasing goals, communication styles, and other situational factors) based on past experiences with the targeted customer. Research demonstrates that salespeople who share/imitate a customer’s communication style and read customer emotions are able to estimate customers’ needs and how important prices are to customers. They also can accurately assess the quality of the relationship as well as match relational activities to the closeness of the relationship, thus making them more effective.

At the impression strategy phase, a seller develops a communication strategy based on impressions created in the first stage. The most effective real estate agent can match specific categories of influence tactics to the communication style of the buyer. Often these agents have a a higher level of knowledge regarding different categories of tactics. Research also shows that the better a real estate agent is at putting themselves in the shoes of the individual to whom they are selling, the better they are able to predict how customers will respond to different strategies.

Stock image of female agent on the phone with a computer and notepad in front of herA real estate agent in the transmission stage delivers the message. This stage focuses on the message that is communicated and how it is communicated, such as language used, tone, pronouns, types of evidence presented, communication medium, etc. Note that communication must be bidirectional (face-to-face, video conference, telephone, texting, etc.) for the adaptive selling technique to be relevant. Persuasive communication falls into three categories including rational, emotional, and coercive tactics. Research suggests a real estate agent will be more successful if they are able to match their communication style to the buyer. Storytelling also has the potential to heighten the attention of buyers and better relate the real estate agent to said buyer.

Evaluation occurs when a real estate agent observes the customer’s reaction (to the message that was just transmitted) and asks for the opinions of the customer. An agent can engage in passive observation or active listening and questioning throughout the evaluation. Those who are better at reading the emotions of buyers are better at adaptive selling, as observation provides valuable information regarding the effectiveness of the strategy implemented by the seller. Research stresses the importance of active listening to improve one’s ability to evaluate buyer response more accurately. Taking it one step further, real estate agents should aim to utilize empathetic listening—striving to understand the thoughts and emotions underlying buyer responses.

The final step of the ISTEA model is the adjustment stage. Based on the evaluation, real estate agents then update the impression of a buyer, pivot strategy formulation, update the message OR make no changes. The adjustment stage is simply the output of the evaluation stage. Research suggests having a learning orientation will increase the success of a real estate agent within the adjustment stage.

Conclusion

As the real estate landscape continues to evolve, the need for adaptive selling will increase as customers require more and more personalized purchasing experiences. The adoption of adaptive selling techniques has great benefits for both buyers and sellers as it improves sales performance, job satisfaction, and customer satisfaction. This research suggests several areas for further research, specifically within micro-level adaptive selling, so it will be essential for real estate agents to remain flexible and ready to learn as continued research pinpoints potential for improvement in selling techniques.

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Recommended Reading

McFarland, Richard (2019), “A Conceptual Framework of Macrolevel and Microlevel Adaptive Selling Theory, Setting a Research Agenda, and Suggested Measurement Strategies,” Journal of Personal Selling & Sales Management, 39(3), 207-221.

This research was awarded the 2020 James M. Comer Award for Best Contribution to Selling and Sales Management Theory in the Journal of Personal Selling and Sales Management.

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Reference

  1. Weitz, Barton A., Harish Sujan, and Mita Sujan (1986), “Knowledge, Motivation, and Adaptive Behavior: A Framework for Improving Selling Effectiveness.” Journal of Marketing, 50(4),174-191.

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About the Author

Richard G. McFarland, PhD
Professor of Marketing, ESSEC Business School (France) 

Dr. Richard G. McFarland (PhD – Georgia Institute of Technology) is on the permanent faculty as a Full Professor of Marketing at ESSEC Business School in Paris, France. Previously, he was a tenured faculty member at West Virginia University and at Kansas State University where he held the L. L. McAninch Endowed Chair of Business Administration. His research and teaching interests focus on inter-organizational relationship and marketing strategies. More specifically, his research focuses on the role of institutions in driving marketing channels relationships and behaviors; influence tactics and persuasion in personal selling and business-to-business contexts; building trust and trust recovery in business-to-business relationships; and the role of emotional intelligence within sales organizations. His research has appeared in a number of leading journals, including Journal of MarketingJournal of Marketing ResearchJournal of the Academy of Marketing ScienceJournal of Personal Selling & Sales Management, and Marketing Letters. He also serves on the editorial review boards of the Journal of Retailing, and the Journal of Personal Selling & Sales Management where he was twice awarded the best reviewer of the year award.

Dr. McFarland has won numerous awards for his research and teaching, including the Ralph Reitz award for the single best teacher of the year in the Business College at Kansas State University, the best single researcher award in the Business College at Kansas State University on two occasions, The Louis Stern Award in 2016 for the most long-term, impactful research in inter-organizational research, the 2020 James M. Comer Award for best contributions to selling & sales management theory, among other awards.

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