The Most Valuable Time To Build Relationships With Customers: Post-Sale

Shelly Kramer

When it comes to customers, are marketers better served focusing on acquisition or retention? And what’s the proper balance of each?

Any marketer worth his or her salt knows that the most valuable customers, and your biggest source of business growth, lies with your current customers. As such, the most valuable time to build relationships with your customers is post-sale. Think about it: A current customer has already said yes. They already trust you. They trusted you enough to buy, anyway. Focusing on those customers post-sale is without question, the most important part of developing an ongoing relationship with them, and it’s not at all hard to do. Let’s explore.

The case for customer retention

When it comes to customer retention, marketers are historically short-sighted, as are their counterparts on the sales team. While acquisition has traditionally dominated retention as it relates to marketing strategy focus, in fact the statistical evidence points firmly towards a solid retention strategy as delivering the best ROI. The fact that we’re still talking about this amazes me: I remember learning this in my earliest days in marketing—in fact, it’s pretty much Marketing 101. Yet we still see sales teams chasing new customers and marketing teams equally focused on acquisition as well.

Consider the stats laid out in this infographic from Retention Science:

Retention-Science-Infographic

As you can see, existing customers are the veritable foundation upon which you should build your business. They have the potential to create more sales and make a greater contribution to profits, all at a lower cost to the business than what you will spend attracting new prospects. What’s not to like about that? And why the heck aren’t more marketers concentrating on customer retention strategies? Here are three things that might explain why:

  • It’s easier (and more exciting) for both sales teams and marketers to focus on drumming up new business.
  • A customer retention strategy takes time to produce returns and marketing departments (and sales teams) are under constant pressure to produce short-term results.
  • The return on investment for customers over the long-term is harder to measure than new customer sales and, therefore, harder to justify.

The importance of understanding your customer lifetime value (CLV)

For those who understand the value of retention (or who want to), embracing a customer lifetime value (CLV) mindset is key. CLV is a model that takes a long-term view of customers, estimating the value of future cash flows, and not just historical sales. It’s a complex subject that I’m not going to get into here in detail, but if you want to explore this more fully, I highly recommend you read Avinash Kaushik’s Guide to Calculating Customer Lifetime Value. I love his blog, and his big brain, and once you read this guide, I predict you’ll be likewise enamored. More importantly, thinking about CLV as he breaks it down will help you as you create your own customer retention strategies.

The point is that while the majority of companies see value in CLV as a concept, only a minority report that they are able to put it into action. According to an Econsultancy study more than three-quarters of companies (76 percent) considered CLV to be important, but less than half (42 percent) actually said that they were able to measure it. Worse still, just 11 percent said that they “strongly agree” that they could measure CLV, meaning that a mere one in every ten companies would appear to have fully grasped the concept.

CLV chart Graphic source: econsultancy.com

Customer retention strategies: How to build post-sale relationships

So if I’ve managed to convince you about the importance of this, please know that an effective customer retention strategy does not mean sending random email blasts to your new customers focused solely on generating interest and more sales. You need a communication strategy with this customer base that delivers ongoing value post-sale and continues to build trust and credibility. You don’t need to constantly be selling them, but you do need to be touching them on a regular basis so that you don’t become just another commodity. There are myriad things you can do, including:

  • Provide memorable customer service. That means empowering your front line staff (online or off) with real time customer information, so that questions can be answered and issues resolved without delay. You want to be proactive, rather than reactive, and build good relationships by meeting—even exceeding, where possible—customer expectations.
  • Listen and learn. Encouraging feedback from customers, both positive and negative, is a great way to understand their likes and dislikes, as well as their needs and wants. Monitoring reviews and social commentary on your brand can provide invaluable insights into what customers are looking for.
  • Everybody likes attention. Feature your customers, and their stories in your eNewsletter and/or by way of short video interviews that can live on both your website and your YouTube channel.
  • Reward loyalty. Build strong loyalty programs that reward ongoing business. Customers may like patronizing your business, but they’ll like you even more if you reward them from time to time for being a great customer. This is easy to do, and can be very cost effective, yet go a long way toward establishing strong relationships.
  • Remember that referrals are a gift. A referral from a satisfied customer is the best kind of gift—don’t take that for granted. Don’t forget to establish referral programs that reward customers for sending you business.
  • Pay attention, pay it forward. Find and follow your customers in social media channels. Share their stories, support their marketing efforts, introduce them to your other customers. Relationships are a two-way street, so remembering that, and putting that into action can go a long way toward building customer relationships that are long and mutually beneficial. Social media makes that easy.

How to not be a commodity: Educate them about your other offerings

Once you’ve got the relationship-building part under control and in process, know that you do need to continue to touch and educate your customers about the other things you do and sell and how you might serve them. As an example, we once had a customer who sold aluminum bleachers to schools and community centers. When I asked about what happened after the sale, our client said that the last contact with a customer was a “your product has shipped” email notification, and that was that.

What they weren’t taking into consideration is that their clients largely found them online, and once the sale was over, they risked being forgotten by customers who might not remember where they purchased. Those same customers, however, might also need things like gym flooring, soccer goals, basketball goals and nets, or pool equipment. But they weren’t staying in touch in any way at all with those customers after their initial purchase, nor were they making any effort to let those customers know other ways they could be of service, thus making those other sales largely impossible. We changed that, and guess what? They sold more stuff as a result.

Whatever tools and tactics you use to develop a retention strategy, it should be built around one clear goal: Building a post-sale relationship with every single customer is the key to business growth and profitability. Court new customers for sure, but don’t ever lose sight of how valuable your existing customer base is. And make sure your marketing efforts are designed to keep those existing customers top-of-mind.

What loyalty and retention strategies do you employ for your business or for your clients? What do you have to add to the list above? I’d love to hear what’s working for you and any lessons you’ve learned along the way.

 

This article was originally seen on The MarketingScope.

The post The Most Valuable Time to Build Relationships With Customers: Post-Sale appeared first on Millennial CEO.

Photo Credit: Polycart via Compfight cc

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Five Goals For Small Business Owners For 2018

Aaron Solomon

Once you’ve wrapped up 2017, you should be hitting the ground running in 2018 for continued success. Here are five goals every small business owner should set for themselves in 2018.

Analyze 2017

While 2017 is over, don’t let it be forgotten. Review how your business performed and what drove revenue. Also pay attention to what didn’t work as well as you’d have liked and allocate your budgets and efforts accordingly. Learn from your successes and failures and use this information to set yourself up for success in 2018!

Increase your customer loyalty

In 2018, all of your competitors will (or should be) trying to take your customers. You should ensure that you have a plan in place for keeping them. Retailers may want to consider a loyalty points program or special promotions targeted at your existing customer base. Even if your business is not retail oriented, take the time to make sure your customers know that they are valued and that there is a benefit to staying with you.

Focus on your employees

A healthy business needs a competent, well-performing workforce. Take steps to not only retain your top performers, but attract top new talent. If you have staff that are not meeting expectations, coach them to improve performance or, if necessary, considering managing them out of your organization. Don’t let staffing hold you back!

Improve your social media marketing

Each passing year, social media marketing is more and more important for driving sales and ensuring success. If you don’t have a social media presence and marketing strategy, make it part of your goals for 2018 to get one started. If you already have one, make sure you’re taking the proper steps to improve it based on your 2017 performance.

Plan for expansion

A good mindset to have is that if you’re not growing, you’re falling behind. Your most threatening competitors will be working hard to grow their businesses, so don’t let them outpace you. Big or small, prioritize developing and executing a growth plan for 2018 to improve your market position!

For more tips on running your small business, visit the SAP Anywhere Customer Success Blog.

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About Aaron Solomon

Aaron Solomon is the head of Training and Content Development for SAP Anywhere. With a dedicated history in knowledge management and consulting, he is driven to provide quality information to customers and help them understand how best to grow their businesses. His areas of expertise include e-commerce management, data analysis, and leveraging technology to improve efficiency.

Adapting To The Digital Sales Revolution

Arif Johari

Is social selling at a tipping point?

“That magic moment when an idea, trend, or social behaviour crosses a threshold, tips, spreads like wildfire.” – Malcolm Gladwell

Social selling is impacting how sales and marketing teams collaborate, accelerate business, and engage customers. With the technology that supports social selling constantly changing, do the behaviours that make a great social seller need to change too?

The modern buyer requires a modern seller

Charlene Li, principal analyst at Altimeter, wrote in the report, The Transformation of Selling: How Digital Enables Seamless Selling: “Selling must transform because the ways customers buy have changed.”

Forrester’s Mary Shea put it this way in B2B Buyers Make The Case For Better Marketing And Sales Alignment: “Your buyers want contextual interactions with both human and digital assets across a holistic but non-linear journey. They want their experiences with salespeople to be high value or frictionless.”

Sales and marketing reps will be obsolete in two years if they do not adapt

Changing times begets a need for a change in behavior. Look at what email did for communications, the computer took away from the typewriter, CRM did for the world of customer service and sales force automation (SFA) for sales.

Sales and marketing professionals must be aligned with a common understanding of the current buyer’s needs. We must meet the buyer in their digitally connected, socially engaged, mobile-attached, and video-hungry preferences. Today’s buyer wants to talk only with professionals who can add demonstrable value.

Myth: Digital selling is the same as social selling

Incorrect. Social is a component of digital.

Digital selling is understanding how to align the mindset, skillset, and toolset to engage, connect, and grow a relationship through any digital platform—social, video, email, messaging, etc.

“Social does not take the place of a handshake, but it turns a handshake into a hug.” – Brian Fanzo

How to adapt to the digital sales revolution through a social approach

1. Update your LinkedIn profile from a resume to a resource

The more value you can bring to your audience, the more likely that they will become fans, referral partners, and clients.

The litmus test: Does your profile get your buyers excited to take your call? If the answer is yes, then your profile is working for you and your customers!

2. Recognize that Twitter and LinkedIn are like peanut butter and jelly: perfect together

If LinkedIn is your primary social media platform, don’t ignore the power of Twitter.

Add your LinkedIn URL to your Twitter profile. When you have a new targeted follower, start a conversation and invite them to connect with you on LinkedIn.

If your profile is positioned correctly, they will learn much more about you as a thought leader and you can begin to move them forward in the buyer’s journey.

3. Schedule time every single day to work on LinkedIn prospecting.

Treat that time as if you were with a client.

Don’t let your prospecting time get interrupted – it’s the number-one thing you can do to get in front of new clients.

Social selling has become such a hot topic that Coffee-Break with Game Changers is dedicating an entire series to exploring its various facets and promoting best practices for salespeople. To listen to other shows in this series, visit the SAP Radio area of the SAP News Center.

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Arif Johari

About Arif Johari

He is a Communications lead, Digital Marketing generalist, and Social Selling advocate. He trains marketing and sales employees to become experts in Social Selling so that they’d leverage social media as a leads-generation tool. He is responsible for executing innovative marketing strategies to increase engagement in social media, customer community, and landing pages through content, events, and A/B testing. He is passionate in making the work processes of the marketing and sales team more efficient, so that they can generate more revenue in a shorter time.

Human Skills for the Digital Future

Dan Wellers and Kai Goerlich

Technology Evolves.
So Must We.


Technology replacing human effort is as old as the first stone axe, and so is the disruption it creates.
Thanks to deep learning and other advances in AI, machine learning is catching up to the human mind faster than expected.
How do we maintain our value in a world in which AI can perform many high-value tasks?


Uniquely Human Abilities

AI is excellent at automating routine knowledge work and generating new insights from existing data — but humans know what they don’t know.

We’re driven to explore, try new and risky things, and make a difference.
 
 
 
We deduce the existence of information we don’t yet know about.
 
 
 
We imagine radical new business models, products, and opportunities.
 
 
 
We have creativity, imagination, humor, ethics, persistence, and critical thinking.


There’s Nothing Soft About “Soft Skills”

To stay ahead of AI in an increasingly automated world, we need to start cultivating our most human abilities on a societal level. There’s nothing soft about these skills, and we can’t afford to leave them to chance.

We must revamp how and what we teach to nurture the critical skills of passion, curiosity, imagination, creativity, critical thinking, and persistence. In the era of AI, no one will be able to thrive without these abilities, and most people will need help acquiring and improving them.

Anything artificial intelligence does has to fit into a human-centered value system that takes our unique abilities into account. While we help AI get more powerful, we need to get better at being human.


Download the executive brief Human Skills for the Digital Future.


Read the full article The Human Factor in an AI Future.


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About Dan Wellers

Dan Wellers is founder and leader of Digital Futures at SAP, a strategic insights and thought leadership discipline that explores how digital technologies drive exponential change in business and society.

Kai Goerlich

About Kai Goerlich

Kai Goerlich is the Chief Futurist at SAP Innovation Center network His specialties include Competitive Intelligence, Market Intelligence, Corporate Foresight, Trends, Futuring and ideation.

Share your thoughts with Kai on Twitter @KaiGoe.heif Futu

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Finance And HR: Friends Or Foes? Shifting To A Collaborative Mindset

Richard McLean

Part 1 in the 3-part “Finance and HR Collaboration” series

In my last blog, I challenged you to think of collaboration as the next killer app, citing a recent study by Oxford Economics sponsored by SAP. The study clearly explains how corporate performance improves when finance actively engages in collaboration with other business functions.

As a case in point, consider finance and HR. Both are being called on to work more collaboratively with each other – and the broader business – to help achieve a shared vision for the company. In most organizations, both have undergone a transformation to extend beyond operational tasks and adopt a more strategic focus, opening the door to more collaboration. As such, both have assumed three very important roles in the company – business partner, change agent, and steward. In this post, I’ll illustrate how collaboration can enable HR and finance to be more effective business partners.

Making the transition to focus on broader business objectives

My colleague Renata Janini Dohmen, senior vice president of HR for SAP Asia Pacific Japan, credits a changing mindset for both finance and HR as key to enabling the transition away from our traditional roles to be more collaborative. She says, “For a long time, people in HR and finance were seen as opponents. HR was focused on employees and how to motivate, encourage, and cheer on the workforce. Finance looked at the numbers and was a lot more cautious and possibly more skeptical in terms of making an investment. Today, both areas have made the transition to take on a more holistic perspective. We are pursuing strategies and approaching decisions based on what delivers the best return on investment for the company’s assets, whether those assets are monetary or non-monetary. This mindset shift plays a key role in how finance and HR execute the strategic imperatives of the company,” she notes.

Viewing joint decisions from a completely different lens

I agree with Renata. This mindset change has certainly impacted the way I make decisions. If I’m just focused on controlling costs and assessing expenditures, I’ll evaluate programs and ideas quite differently than if I’m thinking about the big picture.

For example, there’s an HR manager in our organization who runs Compensation and Benefits. She approaches me regularly with great ideas. But those ideas cost money. In the past, I was probably more inclined to look at those conversations from a tactical perspective. It was easy for me to simply say, “No, we can’t afford it.”

Now I look at her ideas from a more strategic perspective. I think, “What do we want our culture to be in the years ahead? Are the benefits packages she is proposing perhaps the right ones to get us there? Are they family friendly? Are they relevant for people in today’s world? Will they make us an employer of choice?” I quite enjoy the rich conversations we have about the impact of compensation and benefits design on the culture we want to create. Now, I see our relationship as much more collaborative and jointly invested in attracting and retaining the best people who will ultimately deliver on the company strategy. It’s a completely different lens.

Defining how finance and HR align to the company strategy

Renata and I believe that greater collaboration between finance and HR is a critical success factor. How can your organization achieve this shift? “Once the organization has clearly defined what role finance and HR must play and how they fundamentally align to the company strategy, then it’s more natural to structure them in a way to support such transformation,” Renata explains.

Technology plays an important role in our ability to successfully collaborate. Looking back, finance and HR were heavily focused on our own operational areas because everything we did tended to consume more time – just keeping the lights on and taking care of our basic responsibilities. Now, through a more efficient operating model with shared services, standard operating procedures, and automation, we can both be more business-focused and integrated. As a result, we’re able to collaborate in more meaningful ways to have a positive impact on business outcomes.

In our next blog, we’ll look at how finance and HR can work together as agents of change.

For a deeper dive, download the Oxford Economics study sponsored by SAP.

Follow SAP Finance online: @SAPFinance (Twitter)LinkedIn | FacebookYouTube

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Richard McLean

About Richard McLean

Richard McLean, regional CFO for SAP Asia Pacific Japan, oversees all key finance and administrative functions for field and regional headquarters, supporting more than 16,000 employees. He has more than 20 years of experience in senior finance roles with leading global companies across a range of industries, including financial services, investment banking, automotive, and IT. He joined SAP in 2008.