Economist Milton Friedman once told the New York Times that a business’ sole purpose must be to generate profits for the shareholders. He believed that the economy would not support a company whose sole purpose was not looking after the bottom line. Further, he believed that any company choosing to pursue any means other than profit would ultimately fail. That was in 1970. Just one year later, Starbucks was born.
The Customer-Centric Business Approach
In the decades since, words like engagement, purpose, and customer experience have become a part of the business lexicon. The once profit-centered approach morphed into a business model that places the customer at the heart. And for the record, Milton Friedman, as insightful as he was on many other occasions, got it wrong. Companies that have chosen to put the customer experience ahead of the balance sheet, have not failed. With sheer magnetism, they attracted throngs of intensely loyal patrons —and yes, they profited.
Within the B2B market, the role of key account manager is essential. Not only are you charged with keeping the customer or client engaged and happy, but also growing business value for your organization. It is vital, then, that there is an effective flow of communication and opportunities for customer feedback. It is integral for the company to support the key account manager in this pivotal relationship. To achieve this, every party needs to understand how to cultivate successful B2B relationships.
Relationships Differentiate in a Competitive Market
Relationships become even more important in a competitive market where there is not a lot of room to differentiate. Customer relationships are perhaps the most important differentiator and have the power to slingshot you ahead of your competition.
Take Starbucks for example. They do not have the lowest priced coffee. They do not have the fastest service. Many would say Starbucks doesn’t even have the best-tasting coffee. Why, then, do we stand in line far too long, pay far too much, all for a mediocre latte? Simply because we enjoy the experience, we feel invested, and we have a relationship with the brand.
Starbucks found a way to differentiate by creating strong relationships. They call you by your first name, offer you a place to relax with plenty of comfortable seating, while perfectly curated music plays at just the right level in the background. In short, Starbucks is outstanding at making their customers feel special.
How B2B Relationships are Cultivated
In the B2B environment, it isn’t as easy as throwing around some perks. And while brand loyalty can exist, relationships tend to be more one-on-one and take more time to cultivate.
The primary way a key account manager can build relationships is through creating win-win scenarios for their customers. It truly is the Law of Reciprocity in action. By helping your client succeed in their career, you are cementing a lasting bond, while creating loyalty and value for your company. In other words, make them look good and they will keep letting you.
The Four Key Elements of B2B Relationships
One way to develop relationships in the B2B space is to establish yourself or your brand as an authority. The added value to the business relationship is tilted in your favor when you can provide knowledge and advice that is relevant, helpful, and accurate. To achieve this authority status and gain the client’s trust you need to activate these four elements of customer engagement:
- Confidence – They must know that they can depend on your company and the quality of the goods and services you provide. This extends to a personal level of confidence between the client and account manager.
- Integrity – The customer must believe that your company will always treat its clients fairly and that you will always do the right and honest thing.
- Pride – This reflects the degree to which the client feels their business is appreciated, and also the pride they feel from being associated with your company. This is where a little altruism goes a long way.
- Passion – This fosters a sense that your brand, product, service, or even team members are irreplaceable. The customer that feels passion is not only loyal to the company but is its biggest cheerleader.
How to Create Value Through VOC
Another way key account managers can facilitate relationships is through understanding precisely what their clients want and need. How do they use your product? Do they know how to use your product? By conducting initial and ongoing Voice of Customer (VOC) surveys, you are able to take a highly proactive and agile stance. Taking some time to understand your client, their company, and their customers, you can better anticipate the needs they will have down the road.
VOC is sometimes confused with Customer Satisfaction surveys. If you are unsure of the difference check out this article comparing and contrasting the two approaches. Briefly, VOC is a both proactive and reactive tool which captures data regarding your customer’s needs and expectations, as well as their ongoing satisfaction.
VOC can be helpful in determining the needs of your customer’s customers too. For example, you may conduct a set of insight interviews via social media, then extract the specific challenges and priorities of this secondary market. You can then integrate your findings into your positioning and pitch. Let this powerful data inform the way you promote the value of your product to your customers.
Top 5 B2B Relationship Killers
Taking the steps needed to establish a mutually beneficial relationship is the first step. Next, you have to be able to recognize the “red flags” and address those issues quickly. If you can avoid these five pitfalls, your B2B partnership is more likely to become a profitable long-term relationship.
Lack of Ownership When it Comes to Results
You can have the best B2B relationships in the world and still fail if one of you drops the ball and fails to take responsibility and make it right.
The Silo Effect
“What we’ve got here is a failure to communicate.” The Captain – Cool Hand Luke
Within your organization, cross-functional communication and collaboration should be the top priority.
The “Not my Client, Not my Problem” Mentality
It is important that this way of thinking is not allowed within the culture of your workplace. Replace it with an “every client is my client when they have a need” philosophy.
Disappointments are inevitable. This is less likely to happen when you take the initiative to properly educate customers about your products or services, train your team members in how to communicate that information and best handle customers’ needs, implement new features that add value, and update your processes and goals regularly. Look at sales as a cycle, never an end-to-end journey.
You Just Grew Apart
Every business partnership is made stronger when there are shared goals and objectives. Ensure that the relationship doesn’t lose steam by maintaining contact, clearly outlining goals and plans for the future, creating metrics for measuring success, and holding each other accountable.
Tips For Successful B2B Relationships
As we have discussed, B2B companies must cultivate their relationships with the business customer over time. In the B2B space, companies don’t necessarily buy from the brands they like and trust, rather people from within that business buy from people they like and trust. There’s no magic potion to make others like you, but it is not difficult as long as you make it a top priority.
Tip #1: Skip the Cookie-Cutter Approach
B2B companies typically have fewer, though larger, accounts. In this scenario, there is a greater need to connect with customers individually to better assess their pain points, needs, goals, and expectations. Marketers or sales teams should work side-by-side with key account managers to precisely understand the client, treating each customer as an individual.
Tip #2: The Relationship Doesn’t End With the Sale.
In B2B customers can be worth millions of dollars. The sales cycle is longer. Also, there tend to be longer gaps in between purchases. To be successful in maintaining a relationship, even strengthening it, key account managers have to reach out, educate, and serve the customers during these periods of waning activity.
This is a challenging prospect. Take the time to create an active customer management team tasked to create strategies to keep your customers engaged and thinking of you during these intervals. Strategies that include email, content marketing, and social media campaigns come into play here, but they cannot take the place of human interaction.
Tip #3: Help Customers Manage Their Business
As we touched on briefly, B2B companies can facilitate better relationships by providing their customers with solutions to their pressing business problems. This often extends beyond your area of service.
You may consider utilizing your company’s content marketing strategy here. Developing non-promotional content, designed to assist your customers in their growth or that offers helpful advice and insight, is an excellent way to stay connected and establish your role as a trusted adviser. To reiterate, this is not brand-centric content, it is content designed with the goal of serving your customer. This type of goodwill effort can have a positive impact on brand sentiment.
There are many CRM tools and resources available to help facilitate the intensive targeted marketing, sales, and outreach that are needed to be successful in this scenario. Technology has allowed for streamlining and automation of processes that were once too time-consuming to be considered practical.
B2B relationships are complex and time-consuming, but they also represent the single most important strategic advantage you have in a competitive marketplace. In business, anyone can come along and mimic your product, imitate your processes, duplicate your services, or even attempt to price you out of the market, but no one can break the bonds created by a mutually beneficial business relationship.
Curious to see how you can take your Key Account Management skills to the next level? Download this helpful ebook on how to create powerful engagement plans for your key accounts or sign up for a demo of Kapta.