Developing a Long-term Profitable Customer Relationship
A company’s success in establishing long-term customer relationships typically requires close working relationships with many different companies. The act of developing long-term profitable customer relationship will not only create wealth for the company but is also another good way of ensuring the retention of customers and thereby the survival and profitability of the company.
Michael Dell founded Dell Computer Corporation with $1000 when he was a college student at the University of Texas at Austin in 1984. Today, Dell is the worlds leading direct Computer Systems Company with annual revenues in excess of $31 billion and over 34,000 employees. The major reason is that Michael Dell revolutionized the computer industry by introducing the direct model.
The basic direct model aims to deliver a superior customer experience through direct, comprehensive customer relationships, cooperative research and development with technology partners, computer systems custom-built to customer specifications, and service and support programs tailored to customer needs.
Marketing has traditionally been viewed as the sales generating business function. This sales orientation sometimes leads firms to focus too much on generating sales in the short run, with little consideration for customer retention or profitability over the long term. Luckily, the short-term sales orientation is being replaced by more of an emphasis on developing, maintaining, and expanding long term, profitable relationships with targeted customers.
A relationship perspective consists of building partnerships with organisations outside the company and encouraging teamwork among different functions within the firm to develop long-term customer relationships. The days when marketers operated in isolation from other business functions are over. Success in the contemporary business environment requires that all company members work as a team toward achieving common goals.
Customer relationship is the establishment, development, maintenance, and optimization of long-term mutually valuable relationship between consumers and organisations. The relationship delivers values to customers, and profits to companies. A successful relationship between buyer and seller requires a firm commitment from both parties.
Buyers do not like being pressured into making decisions they feel are premature, and salespeople must realize that decisions made under pressure are likely to create post purchase doubts. This can jeopardize the relationship and even lead to its termination. The quest for enhancing customer relationship comes to play. This is to ensure that customer expectations are met or exceeded, so that an ongoing, mutually satisfying relationship between the buyer and seller may continue.
It is not unusual for salespeople to become confidants of customers, offering opinions when asked on a wide range of topics, some of which are unrelated to the sales offering. Salespeople can enhance the relationship by continuing to provide timely information, alerting the customer to forthcoming product improvements, monitoring customer satisfaction and making improvements as necessary, showing the customer additional ways to use the product, and acting as a consultant to the prospect business.
The added value to customers can be reinforced through periodic business reviews, where salespeople and perhaps their management meet with customers to analyze sales and profit performance and identify areas for future emphasis. Sales managers must establish standards by which performance and effectiveness are measured, evaluate performance and effectiveness against these standards, and then take appropriate follow-up action.
Finally, to make a successful sales presentation in developing a long-term customer relationship, salespersons must achieve source credibility – that is, the customer must perceive its needs being satisfied by the combination of salesperson, the product or service, and the salespersons company. The salespersons personal characteristics such as dress, appearance, and manner may be important in achieving source credibility.
© 2010 Richmond Anyidoho
Read more at Suite101: Developing a Long-term Profitable Customer Relationship http://job-satisfaction.suite101.com/article.cfm/developing-a-long-term-profitable-customer-relationship#ixzz0tLpV0Rgh
No comments:
Post a Comment