Building Customer Relationships

 
As I’ve mentioned before, I subscribe to several marketing and sales-oriented newsletters. Some are better than others – like MarketingSherpa – but all have some useful information.

A new one to add to your list is RainToday.

A recent article by Andrew Sobel (www.andrewsobel.com) defines six levels of customer relationships and five strategies to progress to the highest level.

Much of marketing seems to be about finding and getting customers and we seem to forget that keeping is at least as important. An estimate that’s been thrown around for years is that it costs approximately eight times as much to get a new customer as it does to retain an existing one. So if you have limited marketing funds, you’d probably do well to spend a good part of it on keeping your customers.

Here’s a short outline of Mr. Sobel’s Relationshp Levels:

Pre-client:

Level 1 – Contact: You know people you’ve met once or twice over the years, but with whom you have no particular relationship.

Level 2 – Acquaintance: You’ve developed a relationship with people who’ve become more than contacts.

Client:

Level 3 – Expert for Hire: You’ve been hired for a specific job and these people have a positive opinion of you and the work you did.

Level 4 – Steady Supplier: You have an ongoing relationship with someone who gives you regular repeat business.

Level 5 – Trusted Advisor: You’ve developed a long-term relationship with someone who trusts you and your judgment.

Level 6 – Trusted Partner: You’re viewed as someone who is a long-term partner in the business, not just a vendor.

To reach the highest level, there are five growth strategies:

Relationship Expansion – building many relationships within the client’s organization.

Capabilities Expansion – showing your breadth by linking to your client’s agenda and working with them on broad business issues.

Relationship Management Intensity – becoming “focused and systematic about a broad set of relationship management activities.”

Team Leadership – creating a client relationship where the best professionals in your company aspire to work with those clients.

Client Account Planning – developing a dynamic process that evolves to meet the client’s needs.

Not all client relationships are going to reach Level Six. In fact, those relationships are like your best friends; you’re lucky if you have a few that stand the test of time. And, depending on your business type, you may not get past Level Three or Four.

The important thing to remember is that success in business is based on relationships. The better your client relationships, the more value you add and the more success you help them achieve, the more likely they are to stick with you, helping you to be successful as you help them.

Free Information: Is It Worth It?

 
In the course of my marketing research over the last several years, I’ve subscribed to a lot of e-newsletters and downloaded many white papers and reports, with mixed success.

My primary objective for doing this has been to gather as much useful information as possible without paying for it – after all, we’re working on a budget here! And that’s the challenge. Purveyors of business and marketing information are, essentially, consultants looking for new business who use information to attract your attention and create a desire for you to learn more about what they offer. I have no problem with that business model; it provides me with information and resources if I should need them in the future.

However, these organizations seem to fall into three main categories:

1. Those that use their newsletters solely to promote their “profit-generating” products and services.
2. Those that provide some free basic information as well as promoting their business.
3. Those that provide truly valuable, useful free information in addition to promoting their business.

For the most part, should you decide to get involved in gathering on-line content to help promote your business, you can ignore the first two. You’ll rapidly see that, while they occasionally have something useful, the majority of their contacts with you are purely promotional.

The third option offers much more potential. While you’ll find that their products and services can be quite expensive – at least for the small business owner – the quality of their free content is excellent. They seem to realize that what they give away is a reflection of what they have for sale; a lesson that seems to be lost on a large number of providers and one that we small business owners would do well to learn.

One of my all-time favorite providers, which I can recommend without hesitation, is Marketing Sherpa at:

www.marketingsherpa.com

I’ve received their e-newsletter for a couple years now and at least once a week, there’s something I can use – and it’s free. Someday, when I have more money, I’ll invest in their “for-profit” reports because I’m confident that, based on their free content, they’ll be worth every penny. For now though, it’s all I can do to keep up with the free material they provide!

Having Trouble Choosing the Right Business? Here’s Help.

 
What Business Should I Start? 7 steps to discovering the ideal business for you.
Rhonda Abrams
2004 The Planning Shop

In the course of starting my own business – and writing about it – I’ve realized there’s a lot I don’t know. I also feel that, in a sense, I’m writing an enormous, never-ending thesis about the whole thing, so I’ve been doing a lot of research to support my writing, which leads me to my latest book review.

What Business Should I Start? 7 steps to discovering the ideal business for you. by Rhonda Abrams is an excellent, hands-on guide to making the right decisions about choosing your business. It’s full of good common sense, helpful aptitude tests, worksheets, and references. If you’re struggling with choosing the right business for your personality and particular situation, What Business Should I Start? will help you make the right choice.

Great Books to Help You Build Your Business

 
I’ve been remiss lately in adding to my list of reading recommendations, so here’s a quick rundown of three books that I’ve found to be informative and helpful:

The Publicity Handbook
David R. Yale
McGraw-Hill
2001

The Publicity Handbook is an excellent general introduction to public relations. Since it was first written published in 2001, much has changed with regard to PR and the Internet, but it does contain valuable content on using the Internet for PR. It thoroughly covers all the basics from planning and working with the media to the new tools and audiences now accessible using the Internet. It also contains an extensive list of sources and services for publicists. 

PR 2.0 New Media, New Tools, New Audiences
Deidre Breakenridge
Pearson Education, Inc.
2008

PR 2.0 focuses only on how “Web 2.0″ has added to the publicist’s arsenal of tools to reach their audience. It covers PR resources that are now available as a result of the latest wave of Internet tools – often referred to as Web 2.0 – as well has how to use them, from interactive newsrooms on your website to social networking and RSS. In fact, it was PR 2.0 that prompted my earlier blog on RSS and how to use it. From a technical standpoint, PR 2.0 offers lots of excellent ideas for what to do, but doesn’t go into a lot of detail about “how to do.” Still, an excellent resource for what’s new in PR on the web. Of course, these new tools are applicable to all your marketing and advertising plans, not just PR.

The One-Day Marketing Plan (Second Edition)
Roman G. Hiebling Jr. and Scott W. Cooper
NTC Business Books
1999

First, one small complaint about The One-Day Marketing Plan: to call it that is a bald-faced lie. It’s 316 pages long for heaven sake! You can’t even read it in one day, let along create a marketing plan with it that quickly. That said, it is crammed full of useful information on developing your marketing plan. This book plumbs the depths of what it really takes to create a comprehensive plan. If you plan to follow the book in detail, you should hire a full-time marketing director to do it; there’s just no other way to accomplish everything. However, you can back off from a lot of the in-depth planning and research, adapt it to your own business needs and time constraints, create an excellent plan, and still be miles ahead of your competition. It’s a terrific resource that will serve you well for many years as your business grows.

They say that knowledge is power. If you can set aside just 30 minutes a day to read one of the many business books available, you’ll quickly be able to take advantage of tools and techniques that will ensure your business stands out from the crowd.

The need for consistency drives our behavior and willingness to commit

 
Chapter 3 of Influence by Robert B. Cialdini looks at our need for commitment and consistency.

Most people have a strong need to be perceived as consistent in their attitudes, behavior, beliefs, etc. According to psychologists, this need is reinforced because 1) society values a high degree of personal consistency, 2) consistent behavior is generally beneficial in daily life by providing a convenient shortcut in dealing with complex issues.

Inconsistent people are unpredictable and often frightening – you never know what they’re going to do. Most of us don’t want to be perceived that way. We want to be liked and accepted, so we conform our behavior to our peers. If you ever want to see this principle in action, behave in a way that’s inconsistent for the group you’re with and watch the response.

Coming from an artistic background, I may be a little closer to the eccentric end of the spectrum than many people and I really enjoy throwing out a curve ball occasionally, just to see what happens – wicked, I know, but so much fun!

I also wonder how a strong adherence to consistency works with the concept of learning from one’s mistakes. The need for consistency would lead us to conclude that, unless an action has strong negative consequences, we will continue to do the wrong thing just because it’s what we’ve always done.

This behavior is reinforced by the second reason as well. If it’s an easy solution to a complex problem, we’ll probably continue doing it, even if it isn’t the best solution.

I’d like to think that we grow and learn from our experiences, but my hopes aren’t high, given the social and personal pressure exerted on us to be consistent.

Where this fits into the marketing scheme of things – if you haven’t guessed already – is that once a small initial commitment has been obtained from someone, it is much easier to keep them moving forward towards the ends you want to achieve. As long as your requests reinforce their need for consistent behavior, most people willingly agree to them.

This is true whether you’re marketing a product or service, questioning a witness or presenting an argument to a jury.