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Out of Sight, Out of Luck

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As managers, we don’t tolerate employees who “phone it in.” But, have we set up our systems to be so automated and low-touch that customers experience our companies as “phoning it in?” If so, we’re creating opportunities for competitors who know to balance efficient production-related systems with effective customer-facing processes. In this case study, a customer who is happy with his main supplier follows the path of least resistance and gives discretionary orders to a competing supplier who shows up regularly and asks for business.

This is one in a series of case studies highlighting “Key Questions and Course-correcting Quotes” taken from 20 years of B2B customer insight projects. All names are fictitious, but the situations are real. Case studies paint a picture of how important it is to learn what your B2B customers think–but aren’t saying. These are real-world examples of how soliciting and acting on customer feedback has helped companies hold onto customers longer, grow relationships bigger and pick up new business faster.

Case Study: Happy Customer Buys From Competitor

Key Question (asked of a purchasing manager–the vendor’s chief contact in this 5-figure relationship):

“Is ‘RemoteVendor’ showing an appropriate amount of interest in their relationship with you?”

Course-correcting Quote:

Purchasing Manager: “RemoteVendor is located hundreds of miles away. They have to realize my local guy is in here every other week. He gets my discretionary business. He earns it by maintaining a relationship with us. I’ve never actually met anyone from RemoteVendor.”

My Client’s Quandary:

This customer was full of compliments about “RemoteVendor’s” product quality, responsiveness, reliability, competitiveness and professionalism. On the surface, that’s all RemoteVendor expected to learn: How happy are our customers with our business practices? When the conversation evolved into a discussion about where the gaps were, this customer pointed out that, by prioritizing efficiency, the vendor had sacrificed all vestiges of customer intimacy. Customers notice when vendors work to cultivate a relationship, or fail to.

By contrast, a sales rep from a smaller, local supplier made a priority of checking in regularly to pick up what business he could. He was also positioning himself to take over this account if for any reason the customer became disillusioned with the existing vendor. The attentive salesperson was certainly going to get an RFP if the customer ever decided to put the business out to bid.

Conclusion:

This is another example of how vendors leave money on the table. This customer probably knew RemoteVendor could fill his discretionary orders, but the local supplier showed up and asked for the business. It’s hard for someone to look you in the eye and turn you down.

At some level we all know the following rules of thumb are true: The order of effectiveness in building and maintaining relationships with B2B customers and prospects is (from least to most):

  • Electronic newsletters and mass e-mails.
  • Paper newsletters.
  • Customized paper mail.
  • Customized e-mails.
  • Phone calls.
  • Face-to-face contact.

Caveat: Every person has a preference. Ask each customer or prospect how they prefer that you keep in touch. All some need or want is a periodic e-mail newsletter to keep you top of mind. Others want you to call or e-mail them every couple of weeks. Ask, don’t guess.

Cuts to expense budgets can range from travel to IT upgrades to head count. Cuts in head count squeeze your remaining staff. At some point, cuts to expenses start damaging the customer experience and begin to cost you revenue. When efficiencies start diminishing effectiveness, STOP CUTTING unless you’re intentionally trying to find a “new normal” revenue size that can be sustained by your smaller operational budget.

Keep in mind, your customers might be running lean organizations, too, meaning they take the path of least resistance when they can. If you can’t visit them, call and talk with your customers frequently. Cultivate relationships. Ask for more business.

Take heart: If you have prospects whose main supplier is out of the area, you might be able to get a foot in the door by offering to take on small projects. Just showing up regularly might help you displace a remote competitor. Let “out of sight, out of luck” work in your favor!

I categorize projects as assessments, investigations, treasure hunts or rescue missions. This project was an assessment. The client’s question was “Are our customers satisfied with us?” The answer was “Yes, and you’re missing out on easy business by forgetting customers are people first.”

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Source by Ann Amati

Keys Success

Written by Keys Success

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