Clients pay money for products and services. They’ll come back if they need additional support. Does this sound familiar? Boiling down how your business operates to the point of sale makes your client interactions inherently transactional. But this isn’t the best way to conduct business. This article explains why, to build good relationships with your clients and consequently grow your business, you need to focus beyond the point of sale.
Why is Business Naturally Transactional?
Business is based on selling solutions that solve the needs of your clients. Because most business transactions boil down to selling solutions to problems, businesses tend to focus on that, rather than building relationships with their clients.
For example, most businesses will focus on revenue as a measure of their success. Since revenue is a measure of how much clients have given to the business, measuring this leads to a focus on the “point of sale”.
To combat this, you should also measure other ways clients have been involved with the business, such as:
- how many other people the client referred to you;
- how many of your events they’ve attended; or
- the net promoter score rating they’ve given your business.
The Benefits of Relationship-Building
Focusing on the point of sale gives businesses a narrow view of their relationship with clients.
Firstly, nearly every business has a competitor and in many markets, businesses have a lot of competition. There are many quality products and services out there, which means your clients will be shopping around for a solution. This means you have to rely on more than just being a superior solution to attract and keep customers. Focusing on client relationships is one way to differentiate yourself from competitors. A good client relationship will build trust and help to reduce the risk of them going to a competitor.
Secondly, if a business is focusing on the point of sale, they are reactively providing a solution, rather than proactively thinking about and scoping opportunities. Building a strong client relationship involves predicting their needs and providing a solution for them before they even know they need one. Getting this right will increase client retention and brand loyalty. Building trust will encourage your clients to refer others. Such word of mouth advertising is an important differentiator in an online world where every business can be reviewed on Google and social media platforms.
Finally, building relationships with your clients can help your business further understand your clients’ needs. Data analytics tools and other technology can assist your business to capitalise on these insights. You can use these insights to improve and diversify your business’ products and services, instead of acting on assumptions or only reacting when something goes wrong.
Most businesses use a transactional marketing strategy which focuses on the point of sale and increasing the efficiency and volume of sales. This strategy will typically prioritise the pricing, placement and promotion of the product. For example, a marketing strategy focused on advertising a product through Google Adwords.
The alternative to this is a relationship marketing strategy. The rationale is that a long-term investment in your clients will lead to more sales, so it focuses on retaining your clients after the point of sale. To do so, you need to consider client interactions after the point of sale, such email updates or ongoing support.
Generally, businesses implement this type of strategy across the business, so it is used at every level of contact with a client. For example, your sales and customer service representatives may reach out to clients to invite them to an industry event, but your marketing team may also use an automated tool to send out newsletters and updates. You can also focus on:
- providing customer service training to your staff;
- developing relationships with your local community;
- referral programs for your clients; and
- frequent buyer incentives.
Additionally, your business can reimagine the way you approach client service. Many businesses only provide client service if an existing client reaches out with a problem. Instead, you can be proactive and understand your client’s business (and their goals) in detail, including industry trends and organisational structure. This concept of “value-adding” is another way to make relationships with your clients less transactional.
- Make it easy for clients to reach you. If you are not available to talk or do not respond in a timely manner, you won’t maintain a good relationship.
- Use a customer relationship management (CRM) tool to keep track of your clients’ interactions with you. Record the communication channels you use to engage them, and which channels they actually engage with (and therefore prefer).
- Use data analytics tools based off your CRM data to track your clients’ interactions with your business and identify future needs.
- Regularly check in with your clients. This can be as simple as offering a free quarterly or yearly check up.
- Hold industry events for your clients. These can be great educational tools for your clients but also build your relationship and their trust in your business.
- Implement a customer loyalty or referral program. Not every business likes to implement formal referral programs, but it shows you care about the support your clients give you. It can also promote word of mouth referrals and increase community trust in your business.
Building a relationship with your clients is more important than ever in an increasingly competitive market. Doing so builds trust, improves retention and loyalty and gives you an opportunity to improve your product through data insights.
Importantly, there are many tools available to help implement and maintain strong client relationships. You don’t have to implement everything at once, so start with what makes sense for your business and clients and know that, over time, the hard work that goes into establishing and building relationships will pay off.
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