Our guest author today is Michael Boyette. He is the executive editor of the Rapid
Learning Institute Selling Essentials e-learning site and editor of the
Top Sales Dog Blog. Contact Michael via email
or connect via Twitter
It’s a universal rule of business that you must keep your
customers satisfied to keep them around. But here’s another truth: satisfaction
isn’t enough. Satisfied buyers switch all the time. In fact, one study found
that 50 percent of “satisfied” customers are predisposed to switching
suppliers.
Here’s the problem: It’s hard to create a competitive
advantage with satisfaction alone. Buyers expect it from every supplier.
And given half a chance, hungry competitors will do everything they can to
appear more responsive, helpful and easy to do business with than you.
There is another driver of customer loyalty: the pain your
customer would feel if they were to STOP doing business with you. Research
suggests that when it comes to customer retention, these “switching costs” have
twice as much influence as satisfaction.
For some types of products and services, switching costs are
naturally high: A company uses a certain customer-relationship management
system; if it switches to another system it will lose critical data. An airline
has the only flight to Toledo on Wednesday mornings, which is when you really
need to fly to Toledo. In other businesses — such as office supplies or
commodity materials — the cost of switching tends to be low.
As a salesperson, you don’t have much influence over these
built-in switching costs.
But there are switching costs that you can influence:
the ones embedded in your relationships with your customer.
The Entanglement Strategy
Every salesperson works to create great relationships with
their customers, of course. But relational switching costs involve more than
getting your customer to like you. The key to customer loyalty is to create
“entangled relationships” that add value and become difficult for your buyer to
unravel.
Here are two ways to build satisfaction and loyalty through
entanglement:
#1 Create more decision makers
Buyers often claim to be the sole decision maker. That can
be a good thing. It’s easier to get a decision when you only have one person to
convince. But if your buyer changes jobs, moves on or just decides she likes
another vendor better, you’re out of luck.
On the other hand, multiple decision makers favor the
incumbent. When, for example, you have five decision makers on the buying
committee, your account is often more secure because it can be difficult to
change the status quo.
Your goal: Once you win the account and become the
incumbent, seek opportunities to create more decision makers – and be
sure that all of them have a stake in keeping you around.
Find out who else in the organization has a stake in your
product or service. Ask to meet with them to find out how they benefit from
what you sell. Answer their questions and be sure they know who you are and
what you do. By doing so, you’re ensuring that the buyer’s decision has the
support of the team. But you’re also getting other stakeholders entangled in
the purchase decision. If the buyer is ever tempted to bring in another
supplier, they may stop and think. “I’d better see what the people on the team
have to say.”
#2 Training
Everybody knows that training is a pain in the neck.
Managers are never happy about pulling people away from their jobs to learn a
new product or service.
Conventional wisdom suggests that you downplay the need for
training. Make it seem as easy as possible to get things started.
The entanglement approach suggests that you make a big deal
out of training. “Without proper training, you won’t get the full value of what
you’ve bought.”
Offer to take care of both initial training and refresher
courses. Offer to train each and every group affected by your product or
service – production, marketing, customer service, sales, etc.
Work hard to make sure your training is valuable and don’t
hesitate to ask your customer’s people to work hard too. The time and effort
they invest becomes yet another entanglement. If they later decide to switch
suppliers, most of the value would be lost – and everyone would have to get
trained again.
Entangling yourself into your customer’s
business requires planning and hard work. It doesn’t just happen. You have to
look for opportunities to add value and integrate yourself and your product or
service into your customer’s everyday life. In the long run, the deeper and
more entangled your roots, the greater your customer’s switching costs, and the
lower your chances of losing a high-value account.
RainMakers & Sales Rock Stars 