“Nothing is more noble, nothing more venerable, than loyalty.” – Cicero
In the financial services world that I have been working for almost a decade, I have noticed that many organisations strive to achieve profitable growth, higher customer retention, and greater loyalty. Yet many companies struggle to attain those types of results. As a matter of fact, loyalty and engagement remain the top challenges this year for sales leaders.
It’s an issue companies are addressing, however. Based on a Loyalty 360 magazine survey, 64% of companies have a department whose primary focus is on client retention/loyalty, and 31% plan to develop a client retention/loyalty department. This is good news, and the trend is heading in the right direction with 95% of organizations having a department focused on client retention and loyalty in the next year.
I guess an easy way to start that journey is to follow these three steps in a systematic manner :
Marketing in the B2B world greatly differs from marketing in the B2C world, mostly by the sheer number of customers. B2C companies have thousands, sometimes even millions, of customers, while B2B companies have a vital few. The Pareto Principle, or the 80/20 rule, best describes a B2B company: 20% of customers generate 80% of revenue.
Unlike B2C companies that depend on frequent buyer programs to track client loyalty, B2B companies must apply a different approach to engagement and loyalty by targeting three distinct levels in top client organizations: decision maker, influencer, and user.
However, we find organizations often spend disproportionately at the user and influencer levels. A recent assessment conducted by Geehan Group for a client, found 75% of the client’s marketing spend was at the user level, and 25% was at the influencer level. They didn’t invest in decision makers, and that contributed to their low customer retention rates.
The key to creating a level of intimacy and loyalty with decision makers is through your engagement with them. You want to establish the relationship, deepen the relationship, and leverage the relationship.
In the B2B world the best way to establish relationships with decision makers is to form an advisory council. It should include approximately the top 5 of your clients at a decision-maker level. We have tried that couple of years ago with the Sovereign wealth funds in the Middle East, and the initiative created some very tangible results at enterprise level.
Once your decision makers start providing market insight on your advisory council, you can take a sub-set of them to focus on deepening that relationship through an executive sponsor program/account-based innovation. This is a great way to have a one-on-one relationship with your most important clients. When you focus on solving their problems, it is amazing how you can achieve breakthrough co-innovation that can be replicated with your other clients. The loyalty increases.
The hard work that has been put into cultivating stronger client relationships with decision makers can now be realized. Based on how you have engaged them through advisory councils (Step 1) and with a smaller group of decision makers in executive sponsor program/account-based innovation (Step 2), you have earned true advocates at the decision-maker level. These executives will now speak on your behalf at executive summits and round tables, co-author white papers, and give testimonials.
When you focus on the right kind of engagement with decision makers you will achieve tangible results. Selecting the right clients and level are important initial steps toward developing loyal clients. Add to that client engagement, and you will achieve loyalty and retention that will propel your business to a new level. Out of your experience what are the first three steps to develop strategic relationships?
Boris Grozev is a seasoned fintech executive. Entrepreneur by heart Boris has helped number of businesses to create and implement business development and product strategies. His advisory work in Emerging and Frontier markets has promoted culture and technology change, fostered innovation and lead to tangible results. He invests in variety of asset classes. Boris is a fast learner, whose leadership abilities, ambition, stamina, passion to succeed and attitude naturally spread to others helping to achieve common goals.