The Happy Customer

July 18, 2009

The Happy Customer will give you more businessCustomers are essential for a business. Therefore, keeping the customer satisfied and happy is critical for you as a supplier. So, what does make a happy customer? Is it just about saying “yes” to all their requests? Although many salespeople seem to think that saying “yes” is the answer, the reality is quite different. Customers understand and accept “no” for an answer when they realize that they can have a better deal than “yes”.

Quite often, I have heard statements such as “we exceed our customers’ expectations” or “customer first” and I have seen that they are rather ineffective, and in some cases counterproductive, because they neither create true loyalty nor establish a respectful relationship. To me, such statements are just hollow marketing slogans that rarely serve the customer or the supplier’s business for that matter.

To make a happy customer, it does not take all that much, but there is a combination of areas that need to be covered properly.

Before even claiming that you will exceed the customer’s expectations, you need to identify and understand what the customer really wants and needs and why. To achieve this, there is this simple, yet highly effective technique that, unfortunately, many salespeople seem to ignore: LISTEN!

To me, listening is the easiest thing in the world: all you have to do is keep quiet and let the customer speak. Just moderate the conversation by asking a few relevant questions, and take notes! Another important part of listening is that it shows that you respect your customer’s knowledge of his business and of yours to some extent. Too many salespeople fail a sale because they annoy the buyer by pretending that they know everything better.

Another area that is critical to make the customer happy is to never any promise that you cannot keep. Saying yes and not delivering is probably the most effective way of destroying trust and credibility. Since they are already difficult to establish the first time, trying to gain them back is an even harder task. If in doubt, you do not have to say “no”, but tell the customer that you will do your due diligence and get back to him as soon as possible. Since this is a promise, do not forget to indeed do the thorough follow-up, unless you wish to lose your credibility. If you cannot promise this, then you must ask yourself if you really should be a businessperson at all.

If you want to establish a long-term relationship, which is what everybody claims, you also must make sure that your service or product is actually adding value to your customer. By asking and listening, you will find out where the customer has a need for added value, and you must demonstrate clearly to him/her that you indeed can help him/her build a stronger business.

Also, never forget that solid relationships can last only if there is mutual respect. You must show this to your customer, and always negotiate in a give and take approach. The best way to earn respect is to be honest and tell the truth. Saying “yes” only works for a while until the day you disappoint the customer. In my sales career, the best compliment I have had came from Marks & Spencer. My contact there told me that what they liked about our company was that, unlike many of their other suppliers, we dared to say “no”, explain why and come with a workable solution. It sounds so simple, doesn’t it?

Last, but not least, always remember that the customer is the one who pays for your salary, so serve him well and in a way that also supports your business. You also must not forget that to have your salary paid, your business must be profitable, so do not forget to make the customer pay a fair price to you for all the great service you deliver him as listed above!

Copyright 2009 The Happy Future Group Consulting Ltd.

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Be happy that your customer complains!

May 24, 2009

All businesses have it, and most hate it: the customer complaining about the product or the service.
Receiving that awkward callProperly handling customer complaints is actually one of the most powerful ways of creating loyalty. Similarly, poor handling will guarantee your company bad publicity and a poor reputation.
One of the main reasons why complaints are handled in the wrong way is when you take the complaint personally. This happens very easily because in many cases the customer brings his emotions in the picture and makes accusations using “you” while he means “the company”. Entering such a personal argument only escalates things and the discussion usually ends in a conflict.
Not only must you realize that complaints are rarely of a personal nature, they are in most cases legitimate. Of course, there always will be the customer who wants to get some financial advantage by complaining, or those who never will be satisfied regardless of how good your product or service is, but there is a good reason why your customers complain. It might always be rational or logical to you, but be assured that it is to them.
The art of proper complaint handling is in finding out what the actual reason is. Be aware that this can be different from what the customers said at first. You must also realize that emotions are part of complaining and that the customer may need to blow some steam. Unfortunately, he will do so to you even while he knows that you have nothing to do with it. It is just part of the process. Just ask questions, and listen to the answers. If the customers yells, let him yell and do not get involved in a war of words.
Once you have identified the real cause of the problem, deal with it professionally and correct it in the proper way! Once the customer gets what he expected to get in the first place, he will be satisfied again. Just make sure that he realizes that he owes it to your dedication to him.
Be assured that he will remember that special personal service. Thank you very much!This way, you will win his loyalty.
So, be happy that your customer complains, because it will give you precious feedback about the actual quality of your product and service, and it offers a unique opportunity to secure future sales! The worst that can happen to your business is losing a customer without knowing why he is not satisfied, because this does not give you any information on how to improve your product.

Copyright 2009 The Happy Future Group Consulting Ltd.


The best time for prospecting

April 5, 2009

In most cases, companies do their prospecting at the worst time, which is when they have surpluses to sell.
This statement might sound a bit surprising at first, but as I am going to explain, this will make quite some sense.
As long as sales are in balance with production, most companies will try to find commercial arrangements with existing customers to deal with minor volume fluctuations. After all, when you deal with a regular business contact who knows your company and products, it is easier to set up some promotion deals and move extra volumes.
In the same idea, as long as companies can move their own production without much trouble, they do not see the point of actively going out there prospecting for new customers, as they have nothing to offer. Or so they think.
When surpluses reach levels that are not manageable anymore with the regular customer base, then they initiate a massive prospecting campaign to be able to move the extra volume.
All of this will sound like plain logic to most business owners, so why is actually the best time for prospecting the time when you are sold out?
The answer is simply because it puts you in the driver’s seat, which is not the case when you need to get rid of your products.
In many industries, surpluses for sale rarely happen to an isolated company, but very often the whole sector is suffering. The reason can be because the recent times had been quite good and everybody thought that they should increase their volumes to meet demand, but when a whole sector takes this kind of action at the same time, you can be sure that this volume increase is also going to come onto the market at the same time. The result is a saturated market, in which all participants need to move the extra volumes, sometimes at any price (and also at any cost). So prospecting in such conditions gives all the power to the buyers, who have nothing else than being patient as the sales people will come over and over again trying to out-price each other so that they can move their production. This results only in margin erosion.
In the same way, when you are short of product, in many cases there is a fair chance that your competitors have to deal with the same, and are not able to satisfy demand from their own customers
Why prospect when you have nothing to sell?
There are two main reasons for this. First, because this way, there is a lot less pressure to reach a deal, which helps you being much stronger in the commercial negotiation. Secondly, because this could be the time that you mean the most to a customer by helping out, as you could fill a gap left by one of your competitors.
Of course, you might ask how to help out and sell something you do not have. Massaging your sales and production planning can be a way to do this, or playing broker for once can do the same, and helping out makes your company look quite good, which will be useful when you are the one who needs to be helped out.
Prospecting, not out of necessity, but as a strategy to grow your business at the expense of your competitors is the way to go, and is also the most cost-efficient way. After all, remember that, on average, prospecting to get a new customer costs between 10 and 20 times as much as growing with an existing one. So, it better be well-targeted, margin oriented and fitting in a sound business strategy!

Copyright 2009 The Happy Future Group Consulting Ltd.


Always be market-driven!

April 5, 2009

This is always the right approach, even when the market is good. The alternative, being production-driven will only bring you gloom eventually.
A very recent example to illustrate this is the construction industry in the USA. The reason why they are in trouble is because they forgot to be market-driven. As their market was good, and easy, they became overconfident and instead of being business people, they actually became speculators. They assumed that the market was to never change, that the only way would be up, and they built more and more houses without having any contract at all, as they thought that there always would be buyers.
By ignoring how markets function, they created their own demise. First, markets always fluctuate; they never go up in a straight line, so they had to prepare for a downturn. Secondly, they ignored the simple law of offer and demand. By taking demand for granted, they did not anticipate the possibility of ending up with more offering than the market would absorb. And thirdly, they did not produce according to what they could sell, but they produced an inventory; that is the production-oriented error.
Of course, one could argue that the situation they face is the result of the sub-prime mortgage fiasco. This is untrue. The sub-prime issue just accelerated the problems for the construction industry. If they had built only on the basis of solid contracts, all their houses would have been, per definition, sold.
Of course, the number of mortgage defaults and foreclosures is pushing prices of houses down, but this is by far not the only reason why houses in the US are losing so much value. The inventories of unsold newly built houses are huge and the market will have to absorb the surplus.
By not being market-driven, the builders have brought themselves in a working capital crunch. Their accounts payable are going up (yes they have to pay their bills) and their accounts receivable are not coming in fast enough because of the inventories. So, in order to pay the bills and not get into bankruptcy, they have to move the inventories. Profit becomes second to cash. This is why they are selling much cheaper than they had speculated. If only they had been market-driven…
The US builder story is just a superb illustration of the advantage of being market-driven, but this is actually a very common story. Especially when a market is good, companies tend to think that this is the normal state of affairs. Add to this a normal dose of greed and then you have the perfect recipe for a disaster to happen.
Know your market and do not let yourself drag into overconfidence!

Copyright 2009 The Happy Future Group Consulting Ltd.


The little divide between buyers and sales people

April 5, 2009

Last year, I posted 2 questions on the LinkedIn Q&A just to see if sales people and buyers were sharing the same views on the deal process. I was asking sales people what in their view explained not closing a deal, and I asked buyers what mistakes they found sales people were making that turned them off from buying from them.

Although the survey has no pretention of being scientific, some very clear conclusions seem to come out.

What turns buyers off the most are:

  • Arrogant, pushy or condescending attitude.
  • Telling lies or pretending to know more than they actually do.
  • Talking and telling their story instead of listening to what the buyer wants.
  • Trashing the competition.
  • Sales person not identifying their needs.
  • Poor follow-up from the sales person.
  • Sales people looking for excuses or blaming others or something for poor performance.

What the sales people see as a reason for a failed sales negotiation are:

  • Not having established the customer’s needs.
  • They were not talking to the right person.
  • Their product does not add value to the customer.
  • Poor pre-qualifying of potential customers.
  • Not having established a good enough relationship.

So, clearly the buyers are looking to be treated like mature responsible professionals. They want to hear how the product or service that the sales person offers adds value to them and meets their needs. They are not interested in hearing lies or negative story about other suppliers.
They want the sales person to identify what they are looking for and then hear why the supplier product is the best for them. That is all.

Although sales people acknowledge some of the previous issues, they see the weakness mostly in the preparation and in the person on the other side. None of them mentioned that their demeanor was part of the problem. Addressing the preparation is a good thing, and yet the area where they can score the most is pretty easy: it is about asking questions to the buyer and listening to the answers. It is so much easier to offer the right solution once you know which problems need to be solved.

For sales people it is not about showing all you know, it is about thinking along with the customer. I guess that kills the idea that to be a good sales person you must be a smooth talker. No, to be a good sales person, you need to want to help others. And if your product is useless, then pass the message onto your boss and adjust your offerings.

Copyright 2009 The Happy Future Group Consulting Ltd.