For business to business professional services firms who want to create and keep profitable customers, increase customer loyalty, and get a greater return on investment
How business-to-Business Industrial and High-Tech Organizations create and keep profitable customers
From: Justin Hitt
Date:
March 10, 2010
This message is so important for technology or professional services firms, that it's posted here in DRAFT form. If you are a decision maker with a business to business firm who wants to create and keep profitable customers, it's imperative you read every word.
Do you want more from your sales and marketing efforts? Too often sales & marketing do so much about generating new business, they forget all about growing the business you already have.
If you want to retain and keep the hard earned customer you already have, there are three things you must do. These things aren't magic, they require some expertise, but once in place can help you gain a greater return on investment for your efforts.
Three Keys To Creating And Keeping Profitable Customers
Ignore the fallacy of market share, instead focus on share of customer. The massively profitable customers don't own all the market, not even 5% in many cases, but what they do have in common is that they own the loyalty of every customer they serve. You can't be all things to everyone, but you can be something specific to a focused target group of individual interested in purchasing what you offer.
Ask the "What else?" question backed by customer wants research. It's "know thy customer" on steroids, the customers you already serve have other desires they want fulfilled that aren't far from what you've done for other customer. Unlock what your customers are really buying, and unlock new doors of opportunity to your organization.
Implement a marketing system that continually cultivates decision makers to choose you over any other option available. When a customer says "Yes" to someone else, especially when they could have bought from you, then they say "No" to their relationship with you. This includes the slap in the face they give you when they decide to do nothing.
Will these three steps work if you have a one-shot sale? How about a complex solution with a long sales cycle? What about proof this simple method really works?
More proof customer retention can grow your top and bottom line
Existing customers are already qualified to purchase the solutions you offer. By engaging your organization, your existing customers have raised their hand as buyers of the specific things you offer, but what's next. Are there other solutions these customers will need right after your service to them? What about in years down the road? So many companies miss resale opportunities because they think the sales done once a solution is delivered.
The cost per sale on an existing customer is one-fifth that of a new customer. Since you already know who a customer is, you know the decision makers, you've approved their credit, you have an understanding of their business objectives, and you've done everything else necessary to find them -- you don't have to reinvest in these things for the next sale. Why is it then most business-to-business firms, especially those with technical and professional services don't follow up with auxiliary solutions to keep customer buying?
Satisfied customers have proven to themselves that your firm is good. No effort is required to convince a satisfied customer that you'll do a good job, the problem is having a system in place to discover other desires that turn customer into clients. With the right marketing system you can turn satisfied customers opinions of your firm from good to great, while generating additional revenue that make your marketing efforts virtually free.
Referrals cost one-half that of searching for unqualified prospects. Every satisfied customer knows others in similar industries willing and able to purchase the solutions you offer. Too often companies never ask for referrals, or even botch the whole experience, because they don't know how. What would your business look like if every customer referred just 2 new prospects that became customers this year?
Even with a one-time sale, or something with a long sales cycle, you can create repeat purchases that give you a larger share of customer. Customers that purchase year after year, who continually choose you over any other option available. In today's highly competitive business-to-business markets, customers have lots of choices.
How to get past the reasons customer don't buy even when they have many options
What else can your customers do rather than purchase from you? It's not just about handling objections, but helping your sales and marketing teams make your company the only choice for a solution.
Here are some of the obstacles you can overcome with the right marketing system ...
The choice to do nothing,
To purchase from someone else,
The multiple vendor choice,
Not the right provider,
Lack of funding or resources,
Not the right time,
Too many choices,
Not clear of the right choice,
Internal indecision,
Wrong decision maker,
Not the right options,
Right problem wrong priority,
Great solution for wrong problem,
No time for implementation,
Wrong time for implementation,
An in-house solution,
Solve small parts over time,
Existing service relationship,
Just sit down with your sales team, they have thousands of reasons (some legitimate, some excuses) prospective customers choose not to buy. This list is much smaller with a retention building program, but all the same, you can overcome these obstacles with the right marketing system.
How some customers are worth more than others, and some are worth nothing at all
Some of the customer you serve today aren't worth your time, effort, or even waste resources you could be using to grow your business. You know who they are, they pay late, they are difficult to work with, and frankly, you can live without them. Reasons why some customers are worth more:
Profitable customers are easy to pick out in a crowd. From your existing customer base, identify 20 characteristics of your profitable customers. A huge mistake business-to-business firms make is assuming that what their competitors pursue is what they should. What's profitable for your competitors isn't necessary profitable for you.
You can invest more in pursuing profitable customers. Simple mathematics will tell you can afford to invest a little more when you can guarantee greater profits. But most organizations aren't aware of simple measures pertaining to the cost of sales per customer -- instead they lump everything into a rapid growing cost of goods sold.
About 20% of your customers generate 180% of your profits. (See #5) When was the last time you looked at where your profits are really coming? For most business-to-business firms selling even complex solutions, a few customers create the profits necessary to keep you in operations. But what if you could find more like the 20%?
The only measure of a successful business is residual profits. Profits are what is left over after you've paid all the bills, but too many organization worry only about generating revenue. That's why well meaning mangers focus efforts on new business instead of growing the book of business they already have. (A balance is necessary.)
Some customers actually cost you money every year. It's true, some of your customers are draining your coffers dry, actually sucking resources out of your business even though they generate revenue. These customers waste your time, ruin staff productivity, and you are worse off for having them. What if you could fire unprofitable customers?
What I really help you do is turn customers into loyal clients. Clients are decision makers who purchase from you in a way that is beneficial to them, and profitable to you. Clients return, refer others with similar needs, and are great to work with.
Why it's important to turn customers into clients
Clients choose a relationship with your organization. You've already lost sales to competitors who have turned customers into clients, any company who builds relationships over transactions have buyers with white-knuckle loyalty that you'll will prevent you from ever making them let go. (But you can persuade them.)
A client is more loyal to your approach. Repeat purchase customers already understands general business processes, knows how you solve problems, has channels to ask questions, and is familiar with the results you create. Familiarity and acceptance with the way you do business contributes to loyalty.
Clients are familiar with your employees. Customers who have purchased from you over time know you service professionals, accounting team, fulfillment staff, and managers assigned to their project. People like to do business with people they know.
It costs less to serve clients. When it costs less to do something, a business tends to make more profits. With clients costing less than customers to serve (because clients make are repeat buyers) you can reward them in ways that increases loyalty.
Clients are in the habit of buying from you. Most people don't like change, this isn't any different in the business-to-business world. Turning customers into clients makes buying from you the logical habit that if continued will create desired (and predictable) results year after year.
Customers will come and go, but the loyalty cultivated in a client relationship is forever. You can get to this point with most of the customers you already have, plus understand how to identify prospective customers more likely to become clients.
But how? If you follow some simple methods I've shared over more than a decade with technical and professional services firms around the world -- it's not easy, but it can be that simple.
What Business to Business professional services firms do to create measurable results and more profitable Customers guaranteed
I've shared some important points that ever business-to-business executive should consider. Now this is the part where you decide what you are going to do to improve your situation. You wouldn't have read this far if you weren't interested in creating and keeping more profitable customers.
It's only fair to tell you that I've served many happy business-to-business executives, helping them create and keep more customers. And if you have the right attitude, and are qualified, I may be able to create the results you desire for your organization.
The next step is to request an initial consultation about building profitable business relationships, plus details on how to create and keep profitable customers. Just complete this form, and my staff will mail an information kit absolutely free to qualified individuals. (A $97 dollar value) ...
Print out and reread this letter. It was critical I got this letter to you now, rather than waiting till I had more time to make it perfect. If you don't take action now to request more information, at least explore this site for more strategies and tips on building profitable business relationships.
Ps. Do you want measurable results you can take to the bank? I can't stress the importance of at least requesting more information, but if you aren't serious about more profitable customer relationships, I can understand. (More than 75% of new businesses fail in their first 5 years.) You may think you're doing fine, but you know as well as I that you wouldn't of read this far if things were just right. It's easy to get started, click here to request a paid consultation.
