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Creating Customer Loyalty

By: Bruce Hayne

The Holy Grail of marketing and customer engagement is loyalty. In consumer marketing, loyalty is often related more to the brand than the retail relationship, whereas in B2B business transactions, relationships and loyalty are more skewed towards the supplier than the brands they carry or services they offer.

This can be explained in part by the fact that in business, transactions are built on relationships, trust (over time), and ultimately loyalty as a reward of superior customer service. Many B2B relationships involve direct selling in which regular face-to-face visits and ongoing communications solidify a relationship that goes far beyond the actual products or services being provided.

Regular, ongoing contact is the key to developing these relationships. After all, out of sight is out of mind. Too often sales and marketing efforts are placed on new prospects and a flurry of communication is conducted before the initial sale, but quickly diminishes after the first sales transaction. Sales people are stretched with ever increasing targets and the goal of landing new business often supersedes the need for ongoing care of existing clients and the fostering of relationships.

In order to combat this tendency, many organizations put in place incentives and other inducements to create loyalty (often false loyalty) to keep customers coming back with reduced efforts by the sales force. These incentives can take the form of cash discounts for ongoing orders or stocking order plans, incentive trips and other rewards, but ultimately without the care and direct contact with the sales people, these incentives often fail to achieve their intended purpose. This, in turn, reduces profitability and goes against the real goal of creating a long-term relationship based on trust.

There is no substitute for building a strong supplier/client relationship through regular communications. Hoping that clients will simply call when they have a need is a dangerous strategy. The choice of communications vehicles and strategies can be as varied and innovative as your imagination allows. Becoming a source of practical and helpful information for your clients will help to build their trust and the relationship.
• Bring fresh perspectives and ideas to your clients
• Be willing to collaborate to solve problems (even unrelated to your product)
• Have real conversations and NEVER give a sales pitch
• Always be professional

Another way of engaging clients is to bring them into the decision-making process. If you are considering a new product or service offering, why not ask a few of your best ongoing clients to participate in a small focus group? As regular, ongoing purchasers of your products and services, who is better qualified to analyze a new product or service offering and provide honest feedback as to its value and market potential? Not only will you garner much needed feedback, you will also demonstrate to these select clients that their opinions and guidance are very valuable to your relationship.

This may all seem obvious, but there are still organizations that place so much emphasis on the development of new business leads (filling the pipeline) that they tend to ignore their largest growth potential in their existing client base. Think for a moment about your own clients. Probably, less than 20% of them are accounting for the vast majority of your business, while the other 80% represent the balance. If you could move even 30% of your infrequent accounts up to the status of your major clients, just think what that would do to your bottom line. The cost of sale of moving an existing client to a higher sales volume is significantly less than acquiring a brand new account, and strengthening the bond between supplier and client means it will be more difficult for a competitor to take that client away from you.

Loyalty does exist, but you have to earn it. No amount of incentives, trips, and freebies can take the place of building strong client-focused relationships based on simply providing outstanding service. Here’s to the Holy Grail!