Do you know how to leverage personal assets and the assets of your company to "competitor proof" your customer relationships? To build enduring connections with customers requires two distinct skills, focused on two distinct relationships.
The importance of "little r" relationships
The first type of relationship is based on interpersonal connections between members of a sales team and members of a buying team. These relationships might be thought of as "little r" connections. They are founded on a sales team's ability to demonstrate that they are trustworthy, competent and credible as a business consultant and advisor.
Across time, profitable transactions and repeated demonstrations of customer focus forge strong personal relationships that become a valued business asset to individual buyers. They know they are assured of reliability, lowered personal risk, and avoidance of the "hassle" of trying out new suppliers. They also know they can count on their trusted representative to protect their interests, respond quickly to help meet special needs, and offer reliable business results.
Customers become highly averse to risking the loss of these payoffs, and are inclined to resist offers of discounts and price cuts from competing vendors. Even when individual contacts are restrained by budget cuts or other internal issues, they will remember and return to doing business with people they know and trust.
Even one or two little r relationships have value, but the real relationship benefit occurs when your sales team develops a whole network of connections with the right people in the customer's organisation. With a wide range of contacts who view members of your sales team as a trusted business partner, inside information will be shared, and contacts step-up as champions, advocates, and coaches. You will receive advance notice of opportunities and get critical "heads-up" notices when potential decisions could adversely affect a sale.
On the flip side, if these relationships are weak, or have been allowed to erode through neglect or sub-par performance, they offer no protection against competitive encroachment. In the worst cases, where deadlines have been missed, customer concerns left unaddressed, or there have been delays in responding to problems, a poor relationship can actually open the door to competitors. And once gone, the business is usually gone for good.
It may seem elementary, but to build extraordinary little r relationships, it's critical to ensure your sales team know how to:
- Establish professional credibility
- Build trust
- Demonstrate the value of a relationship with every customer, on every call
- Exercise a high level of skill in identifying the right people to contact
- Be fully engaged and capable of carrying out "due diligence" in learning about each customer's personal and business concerns and issues
The importance of "Big R" relationships
As important as little r relationships are, they can be vulnerable to promotions, re-organisations, and downsizing, changes in policies, structure, how decisions are made and budget allocations.
An even more powerful and compelling relationship is the one that exists at the level of business-to-business - a different type of bond we can call "Big R". A Big R relationship transcends ties with individuals. Big R connections are based on business benefits that are highly valued because they are aligned with the customer's corporate business strategy, goals, and critical success factors.
For example, a company that provides its customers with complex high-tech solutions may be very concerned about the research and development direction and technical capabilities of the supplier of a critical component of their offering.
Though not every customer has the potential for developing a Big R relationship, your sales team needs to know how to identify these highly valuable customers, assess their potential, and position and establish the Big R relationship. This requires business acumen and gathering both internal and external information. Specifically, they must develop the capabilities needed to:
- Fully understand the customer's solutions
- Analyse the customer's marketplace and business strategy
- Gain a clear understanding of the customer's business processes
- Verify and articulate the customer's long-term goals and the priorities driving decision-making from the top of the organisation
The next step is to know how to create alignment between the way these select customers are doing business and the way your company does business with them. Once this alignment is solidly in place, it will take much more than the offer of a 10% discount or a better financing deal to break a Big R connection.
The bottom line
Every company is looking for an edge or advantage that will open the doors to new business and serve as a protection against erosion of market share. Some are focused on renewed attempts to differentiate a product offering, some are talking about "building the brand", while others struggle to price-cut their way to a better revenue stream and higher profitability. These strategies can't work for every company - only one can truly be the lowest-cost provider in its category, and few can achieve sustainable differentiation.
On the other hand, strong and enduring relationships are not dependent on product features others can duplicate, or price cuts that can actually hurt the seller's bottom line. Rather, both little r and Big R relationships offer a unique competitive advantage by delivering real business value deriving from the relationship itself rather than from a product or a price.
The ability of a sales team to leverage interpersonal connections and corporate business alignment becomes the best and most reliable resource for maintaining current market share and driving growth.