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The famous Marketing Guru, Theodore Levitt, once stressed that, 'Rather than merely making money, the purpose of an organization, is to create and keep a customer.' And, therein lies a challenge.
Ask any sales person & he will share the thrill he feels on winning a customer and the despair on losing one. The pain of loss is even more felt when you lose an order after months of painstaking discussions when it seemed that you would win the deal.
So, what does it take to win a customer? The question seems simple enough but the reality is that many factors come into play in converting a prospect into a customer. It all starts with understanding the needs of the customer, we know; what is not sufficiently recognized is that customers have both 'obvious' & 'latent' needs. It takes a skillful sales person to know how to discover the 'latent' needs, which often are the real triggers to making a sale. And, during the course of the sales process, the sales conversation will potentially uncover multiple attitudes of the prospect or customer, ranging from indifference to scepticism to perhaps a series of objections that prevent acquiescence to the sales proposal. This sequence applies - with variations of course - whether one is involved in a simple one-on-one retail sale to a multiple-level complex institutional sale spread over months/years.
Navigating through these treacherous waters, a professional sales person woos and wins a customer with much effort. The focus now turns to retaining the customer. Once again, it sounds simple enough: deliver your commitments! So, is that the secret to retaining a client for life?
However, it is not so easy. The proverbial slip between the cup and the lip is a reality in most sales situation! From the customer changing his mind about his preference to snafus at the sales person's delivery-end, there are many variables that combine to make this bridge of relationship very tenuous.
Be that as it may, what really works in navigating through the mine-field of relationships is a commitment generated on the basis of trust built on a bedrock of integrity. Paradoxically, while 'Trust' is difficult to define it is easily explained through personal experiences. In their path-breaking work, 'Clients for Life', authors Dr. Jagdish Sheth and Andrew Sobel explored the element of Trust at length and captured the essence through a formula:
Trust = Integrity x Competence, divided by Risk.
They went on to state that 'your clients' perception of each factor in the equation will raise or lower the trust they place on you.
In a world where Trust is much sought after but sparsely available, we find firms doing their best to win allegiance to their brand from customers. Compounding the challenge is the heavy thrust on quick returns on investment and generating profits now through short-term measures. Whether it is Volkswagen destroying its carefully nurtured long-cherished reputation or the Airlines business exploiting the tragedy of stranded flyers in flood-hit Chennai through price-gouging techniques, the methods employed to get quick results violently collides with the principles for generating long-term customer loyalty. Alas, when will some firms learn that the bridge of trust with customers is built on a daily basis and not through the medium of a high-pitch advertising campaign fueled by marketing Dollars!
These are times when one needs to return to business basics. Doing so, one can revisit a number of management truisms. Here's a good one to begin with:
'Good customers are an asset which, when well managed and served, will return a handsome lifetime income stream for the company.'
As the year draws to a close, these are wise words from Philip Kotler to reflect on to ensure that your clients in 2015 remain your clients in the changing world as we enter 2016!
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