The strength of the relationships with your most valued customers enables you to predict and to sustain the performance of your business.
Statistics from Gartner Group reveal that 80% of a company’s future revenue will come from just 20% of its existing customers. Customer retention costs are much lower than acquisition costs and retaining customers contributes to revenue growth, improved profitability and high-value referrals. I refer to this segment of customers as your most valued customers.
The premise of Scale Your Sales is to help sales leaders understand the driver of customer satisfaction and connection and to educate key account sales professional on how to build stronger connected relationships with their most valued customers.
Why: Strong connected relationships Increases and Profitability and the Lifetime Value of Customers
According to the CEO of Urban Ladder, a satisfied customer will contribute up to 2.6 times more revenue as compared to an unsatisfied customer. Satisfaction builds a positive relationship that will accelerate revenue from your most valued customers. The lifetime value of a customer is a benefit that comes from establishing significant trusted relationships and high customer satisfaction.
It is not good enough to just satisfy your customers, but you must understand that people buy on emotion and only then justify their decision with logic. Communicating with emotional drivers is essential in engaging and developing a trusted connected relationship.
Not only this, when companies connect with customers’ emotions, the payoff can be huge. Given the opportunity to create real value, companies must pursue emotionally connected relationships with forensic zeal and an applied strategy.
“For most, building connections is more guesswork than science. Research by Scott Magids, Alan Zorfas, Daniel Leemon shows that it’s possible to rigorously measure and strategically target the feelings that drive customers’ behaviour. Referred to as ‘emotional motivators’: these motivators provide a gauge of the customers’ future intentions, better than any other measure, including brand awareness and customer satisfaction.”
Although brands may be liked or trusted, most fail to align themselves with the emotions that drive their customers’ most profitable behaviours.
- being unconnected to
- being highly satisfied to
- perceiving brand differentiation to being fully connected.
Fully connected customers are 52% more valuable. The analysis shows that moving customers from highly satisfied to fully connected can have three times the return of moving customers from unconnected to highly satisfied. Moreover, the highest returns come from focusing on customers who are already fully connected to your brand and maximising the value by attracting more of these most valued customers to your brand.
Relevant communication builds a trusted relationship. The relationship builds trust, and trust increases the revenue opportunities.
- Relevant and insightful communication builds the relationships.
Communication builds relationships; if your customer is looking to purchase anything of significant value, the relationship must come first. Building B2B relationships is like dating, slow and steady communication to identify personalised emotional drivers and to discover shared values.
- Test-drive the relationships to build trust.
Most relationships build consciously and cautiously. It is human nature to give a little bit of trust and then expect the receiver to earn more trust. Allow your customers to test drive the product and experience and offer no barriers to them trying before they buy. As the experience grows so does the trusted relationship, if the experience remains emotionally positive.
- Trust increases recommendations and purchasing value and volume.
The more a buyer or influencer trusts you, the more the person will want to buy from you. Always do what you say (and more), do it when you said you would or earlier, you will be ahead of your competitors and building trust and credibility.
Modelling the financial impact of building emotional connections with customers at each step on the way from unconnected to fully connected. Research analysis showed “that although fully connected customers constituted just 22% of customers in a category, they accounted for 37% of revenue and they spent, on average, twice as much annually as highly satisfied customers.”
Scale Your Sales system helps you to measure and monitor relationship connectedness with your most valued customer segments. Gallup has a customer engagement metric, to see how well your salespeople are engaging your clients. Another approach is the Net Promoter Score; I often use the net promoter questions informally to solicit feedback.
Enhancing emotional connection is a viable growth strategy to attract fully connected customers from competitors and transform satisfied customers into fully connected ones. Here are three ways of focus to build emotionally connected relationships with your most valued customers: