Featured White Paper: 'Profiting from Customer Life-cycle Value'

Customers are critical for any organization, hence, it is not unusual for them to adapt various customer centric strategies to win trust and retain them, thereby maximizing profits. An organization hopes to create a mutually profitable relationship with its customer and tries to secure their loyalty. It is therefore essential to understand the different stages of customer life cycle and create effective strategies.

Profiting from Customer Lifecycle Value

Tuesday, April 16, 2013

How Customer-centricity Can Boost Sales

It is not the employer who pays the wages. Employers only handle the money. It is the customer who pays the wages.”- Henry Ford 
A mere serious thought to the above statement reflects, how then, it is the customer from whom the need arises and the customer eventually who keeps the business going. So, it is not hard to fathom that the client is the nucleus of all business activity. However, when the concept of Customer Alignment is being seriously pondered, one can infer that somewhere the customer got alienated from the main business cycle, or at least the focus seems to have drifted. Now, if the premise of any activity gets a little disoriented, how can optimum results be expected.

The 'demand and supply curve' forms the basis of all economic activity. Businesses run to fulfill the demand of the customers and thereby influence the factors of Price and Quantity. The demand arises from the client and the supply is made to the client to satisfy this demand. So, even in this entire number game, where price and quantity are pure numeric fields, what cannot be ignored is 'customer-centricity'. No organization in today’s times can afford to get complacent in this regard.

Importance of setting Sales Goals
A ‘sale’ is what gets in the revenue. It is the fodder on which entire business mechanics thrive. Various plans and techniques are discussed and put in place and there is a constant watch on figures and statistics on an everyday basis, when it comes to Sales. So, it is only natural that for something so critical, a targeted approach has been envisaged. Organizations usually set a sales target for their teams and keep a very close watch on the progress. Critical decisions are based on the numbers finally achieved. The following shall illuminate the benefits of doing the same:
  • Concentrated and focused effort 
  • Quantifiable and measurable progress 
  • Easily comparable performance 
  • Ease of identifying the highest achievers 
  • Can act as a pointer towards areas of improvement 
  • Can prove as a tool towards effective Change Management
There is absolutely no denial to the fact that, it is imperative that sales in an organization should be correctly measured and monitored. Also, what is of prime importance is the fact that, there should be drive and motivation to achieve and surpass targets. With competition having reached stratospheric levels everyone is vying for a place under the sun.

Sales Goals and Customer-centricity 
The criticality of customer-centricity is undisputable; for the organization as a whole and for each specific department. And the importance of customers can be individually elaborated for each department as well. However, the connection between Sales and customers is by far the most glaring. It is the sales person who is performing the entire ‘selling transaction’ and is dealing with either the actual end user or the final decision maker.

The entire sales process, right from the first call or meeting to the final closure, is a direct interaction between sales person and the client. Sales goals, no matter how quantitative they appear to be, cannot be at odds with the client. The situation will not work at the individual/department/organization level. Had the objective been a one-off deal, then just the number of deals closed could determine the success rate. But, if the agenda is continuous and sustainable growth, then there is a whole paradigm shift in the process.

Approach each customer with the idea of helping them solve a problem or achieve a goal, not of selling a product or service.Brian Tracy (motivational speaker and author; Chairman and CEO of Brian Tracy International)
What the above statement outlines is that the sales numbers would be a direct outcome, if customer-centricity is the approach.

Selling is a two way process:
1. New account/client acquisition
2. Repeat Sales

The sales force needs to emphasize both equally. A business definitely needs to add fresh clients to its portfolio because that is what expands the business and opens up fresh avenues. However, satisfied existing clients are extremely important as that is where the steady revenue stream lies. Along with that, satisfied clients are an excellent source of ‘Referral Business’. As most successful sales people will vouch for, getting new business through a good reference is far more easier and efficient way of doing sales.

Application of Pareto’s Principle
Another theory to be considered is the Pareto Principle (also known as the 80-20 rule). The principle when applied to business implies that 80% of your sales come from 20% of your clients.

The above categorically defines how critical customer-centricity is to sales figures. A huge percentage of sales figures are attributed to a small percentage of clients. Clearly this 20% covers the satisfied clients segment, which eventually become your biggest buyers and has the highest share of the sales pie.

What this boldly signifies is the basic understanding of the fact that the aim of the business should be client satisfaction and sales numbers would be an eventual outcome of the same. You need those 20% of the clients who would give you the maximum business.

Changing Dynamics
Sales goals cannot be looked at in isolation or just as a number game in terms of units sold or revenue generated. Sales is now an elaborate client inclusive process and the actual sale is the final step.

Certain parameters other than the final numbers are actively being incorporated in the sales goals and sales persons are evaluated on their basis as well. A few of them are:
  • Number of client meetings held
  • Client Retention rate
  • Client feedback in terms of overall professionalism and access to relevant information
  • Knowledge and understanding of the product by the sales person
Business, no matter how practical an endeavor, cannot be successful if it is neglecting the very consumer, it is intending to serve. It is a widely known fact that brand loyalty forms a very crucial aspect and has a big impact on the sales numbers. Customers refuse to change brands regardless of difference in price or even quality. Their personal interaction, the brand image that they carry, the past experience are huge influencing factors while making the final purchase. A focused approach towards customer-centricity makes a big difference in the sales figures and companies that realize the potency of the fact are sure to benefit in the long run. Sales automation with an enhanced workflow and effective customer strategies are best achieved through a future proof CRM software solution for organizations of all sizes.


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