We have seen in earlier discussions that a key to success is protecting your customers from the competition. Looking after your existing customers means that targets are more easily achieved and profitability is generally higher.
We have talked about how important it is to focus on the relationship between your company as a supplier and your customer who is already buying from you. In many instances, it seems that companies may be dependent upon a single relationship – the one between the salesperson and the client but retaining business is so much more than just one relationship.
Recognise these scenarios?
The sales guy who tells everyone how they had great relationships with their contacts and on the day that they left the company lots of customers changed suppliers.
The one where you find out one day that your contact had very little influence and somebody higher up the chain of command decided to buy from somebody else.
BAD, BAD, BAD. When true, these scenarios just show that the suppliers weren’t protecting their prize possessions —the existing customers— and probably needed the wake-up call. Let’s take a look at how to avoid losing customers by covering every angle to protect them.
STEP 1: BRICK WALLING — Understanding the BUYING MOTIVE
The first thing to understand is why a client is using your company. This is critical as you then need to ensure that you take responsibility for keeping them up to date with changes that may affect them or promote new features of your business that may impact them. It is all too easy just to take their business for granted and then a competitor arrives, highlights a competitive advantage that you could also manage and they swoop away with YOUR business.
“Some years ago, I was managing a sales team and we were nothing short of brilliant at updating our proposal to win new clients. Every time we added a new service, feature or value add we would add it to the proposal options to ensure we always wowed a new prospect. And it worked. What we forgot, however, was to update our existing customers with the same vigour on all our wonderful new developments and capabilities. We lost customers for nearly two years because of this.”
So, remember to ensure that you know about their Buying Motives and keep them top of mind when interacting with the client.
STEP 2: BRICK WALLING — understanding and developing your CONTACTS
This is a big one:
- Who are your contacts within the organisation?
- Are your relationships strong enough with all key individual?
- How strong does your relationship need to be?
Let’s first split contacts into the 3 types most commonly used when looking at client organisation and look at understanding what their role is.
The Decision Maker:
As the title suggests, they are crucial, you MUST have a relationship with them. In some cases, there may be more than one but normally you will find out who is key to be in contact with and have a contact plan in place for them all. Do they need to be your regular contact? This depends as often you may have regular ongoing relationships with others in the organisation. Obviously, if your primary relationship is with the decision maker then you will always have the best opportunity to influence him. If not, you must work out how to build a relationship with him that will ensure that you have his ear. You should have a clear strategy for meeting and influencing the Decision Maker as often as you can so to avoid the once a year or for a contract renegotiation meetings only scenario.
The first thing you need to do with these contacts is to understand the extent of their influence. It may not be easy to accurately access but keep asking questions and you will get there over time. The reason why I say this is that I have known Influencers that are often almost never heard from or about, but where the Decision Maker in the organisation agrees with anything they say. On the other hand, some contacts will position themselves as strong influencers who in reality have very little impact. You need to continually assess and reassess your network of contacts spending as much time as necessary as they are often your regular contact.
Is the User important? Generally, very important. In some instances, they can be the decision maker too and very often they are influencers. But even if they just use the product or service that your company provides, they can make your life very difficult as they often tend to do more complaining that singing your praises.
Then why is this not your regular contact? Well in most organisations it is very likely that they should be in regular contact with another party within your organisation. Either an operational contact, Customer Service or an Accounting person, however, you need to know them as well. Your relationship with them needs to be to the point where if they have an issue with something or somebody within your company they will come to you and not escalate internally.
How many contacts should we have within customer organisations? The answer is that again you need to work this out for yourselves, but the more contacts you have between your two organisations then the better it probably is. If you can cover all bases with contacts across the organisation and up and down the decision-making hierarchy, then you will be in good shape.
One thing that I need to reemphasize here is that is easy to settle into a habit of contacting only the people you know and are comfortable with, but you should always ask yourself “is it the easy thing to do or the right thing to do”. It is more of a challenge to get to know more people in your client companies but in the end, it is key in protecting your customers.
STEP 3: BRICK WALLING – Providing appropriate HOSPITALITY
In today’s business world, hospitality can be taken the wrong way and every company needs to be sensitive what is appropriate of not as it will differ greatly from company to company. However, it is undeniable that if you can connect with your contact, outside of a working environment, in an appropriate way, then it can greatly assist your business relationship. The objective should be very clear.
It is about appreciating their custom but it is about getting to know your contacts a little better which is part of human nature. Understanding each other better has a two-way benefit both for the buyers and the suppliers.
There are many options for hospitality but make sure you know your contact and it is something they will enjoy. Golf Days are always successful but your contact may not like golf. Getting a quick bite to eat is always a good and costs effective approach to hospitality. Alternatively, holding a working session or information gathering day where lunch is included is something to consider.
REAL CASE STUDY
This type of business relationship hospitality is acceptable to most organisations and can be promoted as a company activity. For example, one sales organisation that I worked with held regular client focus group/information sharing sessions each month and the sales team had a quota of customers to attend. The client would come to the office, see the operational side of the business and then we would be taken out for dinner and a continuation of the discussions. It was always a fun evening and our clients seemed to enjoy themselves.
Two years after starting the evenings I sat down with my boss and we looked at the cost of putting on these evenings. It was a lot and we were not sure what return we were getting from the investment so decided to look at data relating to clients that had attended. The results were very surprising – in our very competitive business, where the attrition rate runs at 18%, we hadn’t a single client from the 200 who had attended. In addition, we looked at year on year revenue growth for the clients that had attended in Year 1 and saw that in an economy where industry was growing by 3% these clients had increased year on year spend by over 8%.
Obviously based on these outcomes, we continued the events and increased the sales team’s quota for client attendance to 4 per month.
STEP 4: BRICK WALLING – know and anticipate the threat from your COMPETITORS
You must know your competitor, their strengths and understand where they are at within your client. A competitor who has an existing relationship with your client must be considered a big threat to you. If they are doing their job well, it should mean they are visiting them, wining and dining them and will always have one eye on taking your business. You must stay closer than ever to these clients.
If business at your client is shared with a competitor, then there is a clear opportunity for you to win more business. This will be covered in a later blog ‘Selling to an Existing Customer’, but beware it offers the same opportunity to your competitor.
I would always find an opportunity in a client visit to ask my contact the question ‘Any idea what our competitors are up to?’. You may feel this question requires a strong relationship although I never thought I did. It came out very easily and it was quite surprising how many of my contacts were happy to provide me with a mail out, a proposal or some general information on the competitor sales person or company. What concerned me more was when my contact said they had heard from my competition then but were quite secretive on what was discussed. I would know to keep closer to these contacts for the short term.
Never put down your competitor, but if you know them well enough you can always build your business around your strengths over the competitor. Here is a good example of what I mean:
REAL CASE STUDY
I was completing a coaching program for the sale managers of an organisation and we were discussing renewing for the next year. There was a new GM who I had met briefly but my contact had told me he was looking at another coach that he had used before and they gave me his name. I knew that my competitor was a great coach but had never been in sales, and the contract was for sales people. Therefore, I asked them if they could complete a questionnaire for me so that I could fully understand their next year’s requirements. In the questionnaire, I asked many questions about what the coach needed: sales experience and what the impact of not having sales experience would be. I did enough to make sure they considered having sales experience as an essential requirement.
I never had another discussion with them after the questionnaire. I just received the contract renewal by email a week later.
STEP 5: BRICK WALLING – make sure that you KEEP IN REGULAR CONTACT
We have touched on this briefly when we spoke about the contacts you should have within your customers. However, it is so important that I wanted it to be a brick walling step of its own – it is critical that you keep in regular contact with all your clients. Don’t only see them when there is a problem or issue and if they say they don’t need to be seen, FIND A REASON TO SEE THEM.
HERE IS A QUICK STORY FROM WHEN I WAS A YOUNG SALES EXECUTIVE
Many, many years ago, I received an internal promotion from a customer service role to a field sales executive. I was great at looking after clients but had absolutely no selling experience. When I first met my client base, my immediate reaction was to ensure they were well looked after as that was my background and instinct
The company I was working for had launched a new product that was not in line with their core offering and therefore customers were having lots of issues as it was confusing for us and our clients. I found myself spending a lot of time fixing problems but at the same time, I was building relationships. I needed to be on top of every customer as our competition knew about our issues and were all over our client base.
On contacting one of my clients, he told me that there was no point in my visiting as they were completely happy with everything and that I should save my time. They would let me know if they needed anything so I thought great, a happy customer and less work on my part.
However, 7 months later I had lost my first account. It wasn’t any of the customers that were facing issues and being hounded by the competiton, but it was the one client who said they didn’t need to see me. They did not get hounded by the competitor either, it was just some rates that were randomly faxed through to them one day. They saw these rates and sent me a letter saying that they had a better offer and were moving their account.
Now I learned a lot from this. Firstly, they did not value the service, they must have thought that as they don’t have any issues all suppliers in this industry must be the same. Secondly, they found it easy to part company as there was no relationship in place. I had made it easy for them to move away.
I have learned a very important and simple thing from this and many other experiences to do with customer contact. What I encourage all of you to do is to ensure that you have a call cycle whereby you visit your clients according to a schedule, whether they have asked for the meeting or not, on a regular basis. And stick to it. You must find creative ways of getting meetings scheduled, you must be persistent. You must be very organised. For example, if you feel that your relationship would suffer at a particular client if you didn’t visit every 2 months then ensure you have a set up that will remind you and find a reason to go and see them. It works.
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