How to engage with customers in B2B markets

[email protected] +9821046013

SPJIMR- PGEPM ELECTIVE B2B MARKETING COURSE

B38 C6

Prof S K Palekar

On Customer Engagement Key Account Management

P r o c e s s O f C r e a t i n g V a l u e f o r T h e C u s t o m e r a n d P r o f i t F o r T h e C o m p a n y

I s C a l l e d M a r k e t i n g P r o c e s s

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5 Cs Model of Situation Analysis

Your Company ( You ) Product time line, experience, resources, SWOT .

Your Collaborators (Business Partners) Your Distributors, Franchisees, Suppliers, Collaborators

Your Customers Benefits? Criteria? Motivations? Behavior? Values ?

Your Competitors ( actual and potential ) (Direct or indirect ) How do you stack up against them on things that matter ?

Your Climate of operation (Environment) PESTEL framework What will help and what will hinder


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CUSTOMER CONNECT

CUSTOMER CONNECT CUSTOMER CONNECT


“CUSTOMER CONNECT” TELESCOPIC , CLOSE-UP, ENDOSCOPIC

TELESCOPIC ( CHANNEL SELLING ) END CUSTOMERS NEITHER VISIBLE NOR ENGAGED Very many customers and small order sizes Customer seeks standardized product Customer needs local service : people can be easily trained Marketing has telescopic view. Sales has a close-up view of

channel ENDOSCOPIC ( DIRECT SELLING / ENGAGEMENT )

INTERACTING WITH CUSTOMERS DEEP INSIDE THEIR ORGANIZATIONS Few customers and large order sizes Customer seeks customized products, top management attention,

Exclusivity, Risk sharing and joint property

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CUSTOMER CONNECT

Colgate Toothpastes

LG Televisions

Cummins Gensets

Bright Bros Injection Plastics

100 Mn H/H As annual customers

3 Mn H/H As annual customers

30000 annual customers

1 annual customer

Due to these differences the method of connecting with the customers are all different – whether for understanding customers, selecting customers, communicating with customers or delivering to the customers.


TYPES OF BUYING RELATIONSHIPS “How does the buyer want to be connected?”

TRANSACTIONAL interested in the product and price as at the time of transaction.

REGULAR wants to allocate a certain budget for buying regularly

PREFERRED wants you as the principal supplier for better price/exclusivity

PARTNERING wants your capabilities for developing business together

SPECIAL PARTNER joint set goals jointly, sharing information, investment


What relationships to have ?

From customers’ perspective all customers may not want higher level relationships. For example, a small grocery shop many not like to engage with

Colgate as a preferred account. He may like to buy directly from a distributor

From the company’s perspective A company may like to have different kinds of relationships for the

same product. For example, Asian PPG may like to have

Transactional relationships for selling to small repair shops Partnering relationships for PEM business with auto manufacturers


Marketing Mix : “What matters to the selected customers” This depends entirely on your customers / industry

but some issues are ….

Client’s Processes Pre-Qualification, RFQ, Quotation, Decision, Contract, Routine buying Terms

and conditions in the MOU / Agreements

Agreed systems for Order and delivery and agreed times Dispatch and receiving and inward quality acceptance / rejection processes Accounting and payment and debit / credit notes processes Complaint management processes Compliance : certificates, inspections : local / environmental / CSR Prices and warranties and time period validity MIS integration Performance reporting and incentives

Agreed volumes and share if any Disclosure policies of costs etc

This list is not complete and is only indicative. Only you can prepare a list of what matters to your customers


5 Requirements for KAM to succeed

1. Value is seen in the relationship from both the sides 2. Joint vision for the relationship and is it strong ? 3. Right Team 4. Process for managing the account and planning 5. Presence of selling skills and Account Management Skills


“The Right Account Head ? ”

RIGHT ACCOUNT HEAD : Typically the person who brought the account may be a “hunter” and not a builder of a team which is Ambitious enough to not be happy with the existing business Ferret out opportunities outside usual expertise / comfort zone. Do a good job building account plans. Stay on top of these plans through implementation Find new buying centers. Capable of enterprise conversation.

Many organizations train the existing Account Heads to become an ideal “strategic account manager” that can do all these things but normally it doesn’t work. The key is to not try to look for all these qualities in one person.


8 strategic team roles

Someone in the team must play these 8 roles. 3 are “must” roles 5 are “as and when needed” roles.

It is usually difficult for a person to multiple roles but one person can play these roles for multiple accounts.

The “big 3” roles that are needed on every account are Relationship Lead, Entrepreneur, Innovator

Other roles Collaborator, Technical Expert,

Researcher, Project Manager, Skeptic


Role : Relationship Lead

He creates and strengthens relationships and defends against competitor inroads.

Most Relationship Leads are either good at creating relationships (prospecting) or strengthening relationships, but less often both.

If you want to penetrate more deeply into strategic accounts, you need both.

When the Relationship Lead is missing, you don’t penetrate accounts deeply and repeat business suffers.


Role : Entrepreneur

Also known as the Driver, the Entrepreneur leads the charge for maximizing business inside the “market” of the account. The Entrepreneur is itchy for growth. Wakes up antsy to push things forward. You don’t have to light the fire in the belly of the Entrepreneur.

If you don’t bring up maximizing account growth, she will. Many companies think their Relationship Leads can be molded into Entrepreneurs. One person can certainly play both of these roles, but too many companies try to force their Relationship Leads into the role of the Entrepreneur when it doesn’t fit. Guess what? It doesn’t work.

When the Entrepreneur is missing, no one drives account growth, and account plans don’t get implemented.


Role : Innovator

A visionary, sees ways to increase value delivered to the account that others often don’t. He is often an internal evangelist for the breakthrough change your company can create for clients.

Innovators synthesize information and can communicate the big picture to C suite clients. They can be instrumental in facilitating value discovery sessions in collaboration with clients.

C suite buyers like the vision and energy delivered by Innovators in interactions otherwise they lose interest. Then you end up working a level, or two, or six, lower in their organizations.

It’s more difficult to co-create value with clients when your key contacts are not in the position to make major decisions and lead change initiatives. When the Innovator is missing, you get weak visions for growth and miss opportunities to create value.


Other roles

Collaborator : You don’t leverage all of your company’s capability sets when he is missing.

Technical Expert : if he is missing, “it can’t be done” will trump over “we can figure it out.”

Researcher : He is the detective who finds out information critical for maximizing the business within an account. You miss opportunities, chase dead ends, and slow everything down when he is missing.

Project Manager : When the Project Manager is missing, account plans do not get implemented.

When the Skeptic is missing, you move plans forward before weeding out the bad ideas.


Account Management Process

The 5 stage Account Management Process Outputs: Outcomes produced at each stage Actions: Core set of activities designed to produce those outputs Concepts: Methods and conceptual models that the SAM team

must understand to execute each stage Rising to the Occasion: Understanding of what high performers do

that sets them apart from the rest


Account Planning Tool

Questions to Ask Regarding Strategies and Actions Stakeholders, Account goals, Research, Opportunities, Strategies

and actions, Competitive positioning Overall measure of our relationship with this account?

What do we need to do to get to a stronger relationship level? What are our overall strengths with this account? What vulnerabilities exist with our current relationship ? Across all buying centers where can they benefit from our offerings?

What will surprise and delight this account? What are the “Big Play” strategies (a) Stronger relationships? (b)

Creating new relationships? (c) Expanding value offered to relationships? (d) Unseating competitors (d) Who and when will execute key actions? [email protected] +9821046013

Without sales skills, no matter how good you are at building account teams

and plans, you can’t ….

Create new opportunities Penetrate new buying centers Inspire clients to pursue new ideas and possibilities Understand clients’ buying processes Move opportunities forward Stand out against the competition Make a compelling business case for buying Overcome objections Win new business
