Not only do they contribute a lot to your bottom line but they also influence others in the industry. They are a source of additional sales and if we lose them to a competitor then our growth can grind to a halt. Customer focused companies therefore seek to ‘lock in’ their key accounts. They not only strive to retain them but to maximise the revenue from them. This is a key part of the ‘Keep’ element of ‘Find, Win, Keep’.
So what can you do to exploit your key customers? How can we ‘lock them in?’ In our experience high growth businesses invariably practice all of the following:
they build a network of relationships with their key customers, they don’t just leave the relationship with a key account to one individual, the sales executive for that account, instead they involve the owner, technical staff and others such that they are not dependent on one individual and that relationship with another individual (the Purchasing Executive), in particular the customer focused business hones in on the various categories of ‘buyer’ that exist in many key accounts, namely the users, the techies and the cheque signatories, all are important, all have an influence, nearly always they can veto a purchase, find out who performs these functions – then get to know them
they ‘burrow’, the customer focused business will look to identify other customers within the customer’s organisation, other divisions, other departments, Head Office, the holding company, sister companies – all may have a need for your services, see if you can get an introduction – selling to such people is a lot easier than selling to ‘cold’ prospects
they ask for referrals, they ask for advice on who else might need their products, again it’s an easy way to unearth new prospects – and it makes the customer feel good, we all like it when people ask for our advice, they obviously value our opinions and see us as something of an expert
they look for ways to make it hard for customers to change suppliers, the jargon is ‘increased switching costs’, the more you are involved with the customer, for instance with their product development, and the more you know and understand them, then the more they stand to lose if they look to replace you with say a cheaper supplier, look for ways to ‘lock them in’
Big companies often have an unfortunate habit – they make simple things complex. This includes buying goods and services from suppliers. The customer focused company however is a determined animal – it will build strong and profitable relationships with major purchasers. All great entrepreneurs do this.
Blog written by Winning Pitch, who are a lead delivery partner for the Excelerator Consortium that manages the Business Wales Accelerated Growth Programme.