Relationships: connectedness, engagement, and stickiness
The digital era of self-service websites, lack of trust in corporates and lower barriers to entry allowing fierce competition has organisations questioning how they can improve customer loyalty, or even if brand loyalty is still a thing. Questions are raised such as:
- How do you attract new opportunities in such a noisy market?
- How do you keep track of key conversations across phone calls, face-to-face meetings, videoconferences, chatbots and other engagements?
- What metrics could be captured to identify where our engagement levels are sub-par, are lower than benchmarks or are changing over time?
- What actions create value for our clients, and which are being lost, wasted or annoying?
- Is our strength in acquisition or retention of new customers?
- Will our customers leave us tomorrow if a shiny new competitor arrives promising better service or a cheaper price?
- How can we more effectively forecast demand for our products and services?
- Everyone is busy, but who is the most efficient or most productive when building relationships?
- We have a long list of customers, but which are the most important?
Relationships are a familiar concept for us all in our personal lives, but they are also key to growing sales and increasing profitability.
It is critically important for all organisations to understand the health of their relationships.
Keep in mind that relationships exist between team members, managers, customers, suppliers, regulators and the variety of stakeholders that surround any organisation. But it’s more complex than that.
Transactions occur between businesses, yet relationships exist between people.
Who in your organisation has a relationship, of what type, with which people in a customer’s organisation? And how does the strength of the relationship match to the importance of the customer?
To answer these questions, it’s important to identify all the individuals in your business and your customers, and know which are connected. Secondly, consideration should be given to the type and frequency of engagement. Are all contacts made specifically about a particular product always purchased by a customer, or are there regulator interactions that help business development managers understand their customers’ businesses, allowing them to identify additional products to market to them?
By identifying the quantity, frequency and strength of relationships, a value can be calculated in terms of “relationship health”.
Analysing customer accounts in terms of value and product mix over time, can help you arrive at a value for individual customers. Some marketing teams refer to a common statistic of “customer lifetime value”, as one way of considering this.
Combine relationship strength with customer value, rate your organisation’s performance, and identify actions to improve these scores and you will be well on your way to leveraging relationships and building opportunities to grow your business.