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September 2010 Archives

Getting C-Level Executives to Buy--and Refer--You: The Do’s and Don’ts

Posted by Bill Lee on September 21, 2010 at 08:55 AM

C-level customer buyers can be exceptionally valuable. In some cases, they can make a business. Such customers tend to have substantial budgets with which to buy, and broad networks of peers they can refer you to for additional business--if you deliver the goods to them. 

Persuading C-level prospects to buy, and once they do, persuading them to be references, are two sides of the same coin. Here are some Do's and Don'ts to keep in mind in attracting them. These are all based, by the way, on real world kudos and complaints about vendors from an actual C-level executive at a Fortune 100 firm. 

To successfully engage and educate prospective C-level buyers: 

DON'T 


- Send a racing car model missing the remote control, and offer to bring it if she'll agree to a meeting (an actual example). 

- Use gimmicks of any kind. You're just demonstrating a lack of imagination. 

- Throw up a white paper on your website about your solutions or offerings and expect her to find and download it. 

DO 

- Send or otherwise provide (or "push") information to him about how to solve a compelling problem. For example, instead of a white paper about your latest advances in mobility solutions, provide a case study about how mobility solutions are saving office rent and improving productivity at a company like his. 

- Invest in significant market research. Know your customers, know their issues, know their business. The same for attractive prospects. 

- Learn about your C-level executive's network. Who is she connected to? If you can get a referral, or at least demonstrate you know someone in her network, that's instant credibility. 

To initiate a relationship with a prospective C-level buyer: 


DON'T 

- Walk in to a first meeting saying, "Tell me what your strategy and challenges are." 

- Expect her to spend an hour telling you all about her issues and problems. 

- Feel you have to help her save the world. 

DO 

- Walk in having researched her issues, so you can say, "Here's a problem I know you have, and here's how we can help." 

- Start small, such as offering to save her just $50,000, or even just $10,000 or even $5,000—in order to build trust. In tight times like these, even Fortune 100 C-level executives are attracted to such savings. 

For a prospective C-level buyer who's ready to decide: 


DON'T 

- Provide references that aren't a "good match" for her business and her issues. It's a waste of everyone's time. 

DO 

- Demonstrate that their investment in your solution will repay itself quickly, in the first year if possible. 

- Build their confidence in you, and not just with your financial performance, but also by showing what outstanding customers you've signed up. 

- Use your own company as a reference—one of the most powerful, and overlooked references you can provide. Are you using the solution you're selling? Let your prospect's implementation people talk to yours. Microsoft, for example, is well known for living this credo, and it makes a powerful impression on corporate buyers. As one CIO put it, "Case studies from your own IT department are absolutely persuasive." 

Once the deal is signed: 

DON'T 

- Ask for a press release right away, a major turnoff to our Fortune 100 CIO.   

DO 

- Remember, it's not the contract; it's the creation of significant value that counts, and that won't happen until sometime after implementation. 

As the relationship builds: laying the groundwork for repeat and referral business 

DON'T 

- Drop in just when you have a reference or media request. 

- Have weak CRM (customer relationship management) practices that result in things like your new customer calling in and no one knowing who he is. Or you send letters to his company addressed to his predecessor. 

DO 

- Take advantage of the significant opportunity to build relationships in tough times. Doing so can make a lasting impression. As one CIO put it, "What I look for is a partner who'll be with me in bad times as well as good." 

- Remember that your customer DOES want to engage with you, if you go about it the right way. Forget the tricks and gimmicks. 

- Offer a potential marquee customer the full range of opportunities to engage with you--not only to be a reference, but to participate in communities with their peers, or perhaps in an executive advisory board of some sort, and so forth. As our Fortune 100 CIO put it, "Offer me the full range of opportunities to engage with you. Give me the chance to improve your service to me, measure the value you're delivering, develop best practices together, partner with you, engage in marketing with you, and interact with my peers." This opens up a world of additional value she can provide beyond just purchasing--value that many companies entirely overlook. 

- Make referencing by your customers a part of the ongoing discussion--along with implementation performance--between the account manager and your customer.  That's what a strategic reference program does. 

What ELSE Can Your Customer Reference Program Do?

Posted by Bill Lee on September 20, 2010 at 04:32 PM

From the September issue of our newsletter.

Looking to freshen up your reference program, and improve its impact on the business? The ways in which customer advocates or promoters can improve your business are almost limitless--and go well beyond providing traditonal sales and marketing references.

To stimulate your thinking, here are some of the creative ways I've encountered where reference programs are playing new, important roles that are having substantial impact on business results. These are all REAL examples of things reference programs are actually doing.

- Improve demand generation on the Web.

Intel, for example, credits well-designed testimonial videos and other customer content for an explosion in qualified lead generation from their web sites (a tenfold increase).  Within a few years, the firm expects such efforts to bring in 10% of all its new business. The key to this growth is content from its existing customers.

- Build key-customer executive relationships.

The reference team at a major software firm builds their own relationships with such customers, often bypassing account reps. It is not uncommon for reference managers to introduce account reps to customer executives, rather than vice-versa.

- Provide a superior customer engagement experience that improves retention rates.

SAS Canada credits its integrated customer engagement efforts--which include a combination of reference program, user groups, key account management and communities--with restoring its lagging customer retention rates from 88% to a near perfect 98%.

- Automate customer content generation.

A growing number of firms including Hewlett-Pachard, Hitachi Data Systems, EMC, Symantec and others are making rapid progress in automating creation of highly effective yet relatively inexpensive customer marketing content. And they're getting much of the content from "the other 90%" of customers who don't participate in ordinary reference activities.

- Improve early adapter rates.

A mid-sized enterprise software firm's customer reference program recruits key customer references into product upgrade launches. The result has been substantial improvements to new product adoption.

- Help to launch "solutions selling" efforts

One of the most lucrative and difficult transitions a firm can make is from selling products to mid-level technology users to selling solutions to senior decision-maker buyers. A mid-sized engineering software firm is making this transition and its customer reference program is playing a key role in the process. For example, they are using case study development to uncover the financial impact of products on current customers, extract the competencies needed to achieve such impacts, and then use that knowledge to train the firm's sales people to sell solutions to higher level executive buyers.

- Improve strategy through engagement with executive customers

Engaging with key-customer executives can be particularly lucrative for B2B firms. Studies by the Geehan Group show that firms that specifically target decision makers in customer engagement programs achieve customer retention rates of 90% (vs. 72% for those who don't) and account growth of 12% (vs. 4%).  Most remarkably, customer executives who are so engaged are far more likely to participate in referral activities: 94% vs. 28%.  Reference programs can clearly play a vital role in developing these relationships, as for example, CA Technology's Flagship program does.

- Improve R&D and new product development

By skillfully engaging in strategy discussions with key customer executives on its Executive Advisory Boards, Harris Broadcast was able to generate 50% of its revenue from products developed during a difficult 24-month period when the economy was tanking.

 - Gain greater penetration into existing customer accounts

Reference programs can provide considerable value by getting referrals to other key users of their firm's solutions, developing relationships with them, and encouraging them to join the reference program as well. These sorts of referral relationships don't have to stop with acquiring new references.  Why not uncover new buyers while you're at it?

 These are just a few of the creative ways that customer references and reference programs are helping firms improve performance. What are some creative new ways your reference program might make a major impact on your business? By the way, feel free to share these with me and we'll let the community know.

 

 

 

Who Are Your Blind Sailors?

Posted by Bill Lee on September 14, 2010 at 03:38 PM

San Francisco's Ed Gallagher was an avid sailor when he went blind 15 years ago at the age of 44. But in the last few years he and a couple of other disabled sailors began experimenting with some gizmos that would allow Ed to actually said a boat again--by himself. They jerry rigged a rudimentary system consisting of a laptop and a bulky camera strapped to a bike helmet, to allow someone with sight to direct him from anywhere in the world. They since improved technology with things like Wi-Fi, a more compact webcam embedded in sunglasses, and a small Asustek network computer. The solution isn't perfect, but it by gosh has the blind Ed out in the SF Bay, sailing "alone."

So what, you say? How could such an outlandish use of those technologies matter? Because Ed is a classic type: a "lead user," that is, a customer whose demands are ahead of those of the majority of the market, and who have much to gain from a solution to such needs. And these folks can be KEY for companies wanting to improve their innovation. 

That's how, for example, auto makers came up with the idea of antilock braking systems (ABS) from the airline industry--planes have much more extreme braking needs than cars, and they developed ABS to meet them. The result: auto makers adopted antilock braking system (ABS) technology to autos with great success.

Already, Ed's technology is showing similar abilties to adapt to other less extreme needs: it's been used to help blind people recognize the difference between regular yellow mustard and Dijon in a refrigerator, for example. There are four million blind people in the US. 75% are not employed. Developing technologies to help them work is a tremendous potential market. Lead users like Ed--as opposed to just gathering a bunch of researchers in a room to "think of something"--can help show the way.