5 Steps to developing lasting client relationships
Whatever stage you are at with a valuable business relationship, there is one constant. Your competitors are all vying for that same relationship. One survey by RainToday.com found that over half of clients are open to switching from their current providers. A key component of consultative selling therefore is not to take these relationships for granted.
The client relationship cycle can be described in 5 key stages:
1. Courting: This stage involves your initial business development activities. In this instance you will be searching for contacts on linked in, making phone calls, looking for a way to open doors and sell the benefits of your product or service. Look out for a blog on making that initial all important first contact in the coming weeks.
An important question to consider at this stage is whether you are simply pursuing a sale or a long lasting relationship? If we’re all agreed that long-term, profitable client relationships are to be highly valued, then why would we not specifically seek such relationships? Therefore consider focusing your business development activities on developing relationships as opposed to simply sales.
2. Contract: While making a sale is often thought of as the end goal of your business development effort, it is only the beginning of the formal client relationship. To draw an analogy from romantic relationships, this is hardly marriage; it’s more like cohabitation. There’s no long-term commitment at this point, only a pledge to stay together until something potentially better comes along.
At this stage, it’s easy to turn our focus on making other sales with different clients rather than looking to develop the existing relationship further.
3. Continuation: If all goes well enough, there’s a good chance that you’ll have another opportunity to work with the client. Usually this is reward for passing the test under the contract phase. Fail the test and the relationship ends at this stage. Of course, some clients simply won’t have subsequent work or prefer to spread it around regardless of how well you do.
While it’s certainly desirable to reach the Continuation stage with a client, there’s little reason to get comfortable here, even if it lasts over an extended period. It doesn’t necessarily imply that the client is loyal. In fact, that’s probably not the case. Confused? Well remember the earlier point that over half of clients are open to change. In other words, if someone better came along, clients would be tempted to “upgrade”. If you want to reach the next stage in the relationship life cycle, you have to work at it.
4. Commitment: At the commitment stage, the client has developed a loyalty to you and your business. There’s little, if any, serious consideration of other choices. This is obviously a great place to be in your relationship with the client. Now you’ve finally entered the equivalent of marriage. It’s not contract to contract anymore; it’s for the foreseeable future.
Even the best committed relationships can collapse under the right set of circumstances however. Sometimes it’s not any one big thing, but a persistent series of little failures that all add up to a perceived neglect of the relationship. That’s why it is important to engage a plan to prevent the risk of stagnation in such relationships. Scheduling meaningful meetings with the client to review performance and discuss how to take the relationship further still is an essential part of maintaining this phase of the relationship.
5. Convergence: A committed relationship is wonderful, but there is a higher level still. Convergence is reached when you and your Organisation become an integral, strategic component of your client’s business. It’s a level very few businesses attain in truth. Convergence is achieved only when you master meeting strategic needs, and to get to this stage, you need to have a thorough understanding of the client and ensure that they trust you implicitly.
So what can you do with this right now? Consider your existing client base and ask yourself which stage of the relationship cycle you have reached with them. Be brutally honest. Then outline what steps are needed to take each relationship (at least the ones you want to retain) to the next level. If that seems too ambitious, then do the exercise only for your top clients.
For further information or to discuss your sales strategy, contact us on 07887 994300.