Building Business Relationships

Are you struggling to create and keep profitable customers? Columns for Sales and Marketing Management who wants to build business relationships.
Thursday, July 24, 2003

How to Impress C-Level Executives with Guerrilla Online Marketing. See the results of on-line marketing campaigns, including sample landing pages, ad copy, and banner images. I shared full details of over 3 years of real marketing tests.

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Customers buy when they get more of what they want

HPCL woos customer loyalty through cooking gas. Providing incentives like equipment discounts and free insurance coverage attracts new customers. Silicon India Jul 24 2003 11:25AM ET [Moreover - CRM news]

Hindustan Petroleum Corp Ltd (HPCL) is running one of the most ingenious incentive and loyalty program I've ever seen. It not only attracts new customers, but develops an ongoing buying relationship with them. With a number of firsts, I'll show you how to carry over their efforts into a business to business world:

1. Loyalty program offering insurance coverage against any injury due to an accident with cooking gas or liquefied petroleum gas (LPG) cylinder.

Is your product dangerous?  By offering insurance on injuries due to accidents with your product you are showing customers you really care about them.  At least you are interested in protecting your investment in a buying customer, the cost of a full-coverage policy is negated by the good media coverage and customer protection in the rare instance your product fails.

Say your product won't cause personal harm. How about offering a bond on the failure of your product, "if our widget fails for any reason, we'll pay you $10,000 dollars or replace it at no charge."  Completely remove the risk your product will fail by offering financial assurance, that if it does, you'll quickly do something about it.

2. Launched a program to allow customers a chance to weigh cooking gas cylinders at time of delivery.

Give your customer a way to verify the quality of each delivery on receipt. With cooking gas HPCL found that 33 percent of consumers were unsure they were getting a full capacity cylinder. By providing a way to verify this they reinforce the idea the customer is getting exactly what they purchased.

A simple way to reinforce customer expectations is to include a checklist or guide with the delivery of all products. Walk your customer through your product, providing them details about product benefits as they check off a list outlining the functions they purchased. Do this in addition to bills of laden, or delivery receipts. Make it clear that if something is missing they can call customer support and have it replaced immediately.

3. In Mumbai loyalty program members are being offered discounts on household goods at ranges from 40 to 50 percent, plus accumulated loyalty points redeemable against products.

This type of program locks buyers into a particular consumable product, not only making it more affordable to acquire your products, but possibly bringing them your entire line. What does your customer need to use your product?  Can you provide it to them in quantity, passing along any discounts?

Hewlett-Packard does this with printers, making their real money on consumables that over the life of the printer bring in greater profits. Whether you sell heavy equipment, computer systems, or manufactured goods, some part of what you provide is consumable.

To implement incentive programs around your own product, consider the following:

Justin Hitt teaches executives strategies to improve business relationships that can increase revenues while reducing costs of service. Publisher of Inside Strategic Relations, a twice-monthly newsletter.

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Some problems with B2B trade publications

While the trade publications your customers, or even your employee reads, can be tool to build stronger relationships, you must consider some of the problems with most B2B trade publications.

Often trade publications promote confusion over an understanding. Packed full of jargon and terminology designed to keep you in the dark, primarily so you hire expensive consultants (or visit advertisers.)  Articles often are grammatically poor, bias in nature, and hardly provide the value promised.

At least that is what some people might say. In truth, a few B2B trade publications must cover a large array of topics -- this makes a close study of specific topics difficult.

Understand there are wonderful B2B trade publications, and as much as this article discusses their problems, it outlines the traits of great publications.

Justin Hitt helps executive build stronger relationships that can increase profits and create loyal customers. For more information visit Inside Strategic Relations or call +1 (877) 207-3798

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Put every asset to work on the bottom line

Does your organization have space it could lease to supplier?  You could solve two problems at once:  generate capital for unused assets while reducing delays in fulfillment. This is exactly what Boeing is doing with Giddens Industries (a specialized parts supplier to Boeing in Everett WA).

At least once a year go over your asset utilization.  If you are under utilizing or plain not using certain assets at all, consider leasing them to strategic partners. Look for companies who will benefit your organization for the use of the asset -- whether manufacturing equipment, office space, or even specialized expertise.

Even providing these assets at a market discount (but reasonable profit) you keep them available for future use. For heavy equipment you can lease a percentage of your support staff to maintain these items -- these hybrid material/service contracts can keep your company strong through hard times.

Focus first on partners who directly support your organization. Look at aspects of reducing their costs and passing along those savings to your organization.

Some examples of putting unused assets to work for your business relationships:

While many of these measures are temporary, they could open the way to profitable long-term relationships if properly managed. This type of relationship can be especially useful if it can reduce the costs of your partners while generating income on idle assets. What value can you produce from assets your not using?

Justin Hitt helps executive build stronger relationships that can increase profits and create loyal customers. For more information visit Inside Strategic Relations or call +1 (877) 207-3798

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Last update: 04/08/2004; 2:32:55 PM.

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