Latest / From Stalled to Scaling / You Don't Have to Start From Scratch Anymore
Transcript
- Jim Tincher, HoC: Where should your next dollar of relationship spending go? Four years ago in my book, Do B2B Better, I told readers that emotions matter. And then I told them to go find their own emotions because the answer is in your own data. Now that was true, yet it was also expensive advice. Since then, we've conducted over 800 interviews with B2B customers, and we found in order to look in, and most companies. Spend their resources backwards. By the end of the session, you're going to leave with the right order, and the reason relationship money spent too early never comes back to you in profit. I'm Jim Tincher, and this is from Stalled to Scaling: eight-minute ideas for B2B leaders on growing to the customers you already have. Now, before we hop into the content, I'm going to invite you to go over to heartofthecustomer.com. That's where you can find more information on my book. Do B2B Better, you can sign up for our newsletter. You can check out the blog, White Papers. But now let's get back to today's content and talk about the book. Now, the examples in Do B2B Better, they all pointed different directions. For UKG, their emotional North Star, the emotion that best predicts the behaviors they care about, was confidence. For Dow, it was enjoyability. For Haggard, it was happiness. And so the lessons I drew from that is you can't borrow another company's answer. You have your own unique emotions. And while that's technically correct, it also left every leader starting from a blank page. And just to be honest, most people didn't accept that advice. And so as a result, they weren't taking the most powerful way of predicting your customers' behaviors, which is understanding their emotions. So, first, let me concede a point because someone in your team will raise it and they'll be right. In our benchmark of manufacturing and distribution customers, 10,000 surveys, the recommendation score predicts growth better than satisfaction does. It's a strong number. And so, likelihood to recommend our NPS, it does predict growth. And so it sounds great. We're using NPS, fantastic. We'll go with that. But there are a couple of challenges that makes it far less useful. First of all, is it's not terribly actionable. How do I get customers to say they'll recommend us? Do I give them introductory cards? I don't know what to do with that. That's what I've heard from many executives. But second, and far more important, is what causes likelihood to recommend to improve is different than what causes the customer to say they'll grow with you. Now that's critical. Yeah, we care about recommendations. But in B2B, very few companies actually track them. But we care a lot about growth. So why are they different? Well, a recommendation depends on trust and on feeling heard. And that matters. But we look at what leads a customer to say they'll grow with you. That depends on your account team, how hard you are to buy from. Do customers feel valued? A net promoter score tells you who's likely to grow, but it doesn't tell you what. to fund to get them to grow. So we coded those eight hundred and eighteen interviews with B2B leaders, find out what does move growth. And what came back was not one emotion, but a sequence. Now, the B2B share of wallet hierarchy has five levels. I'm going to hit the two that are most critical to drive growth. The first is confidence, and that's where growth begins. Feeling valued accelerates growth. Now that order matters more than it sounds. If your customer isn't confident in your ability to deliver them, they don't think you can handle their business when it gets complicated. Then no amount of relationship work is going to change their mind. They're not going to grow with you because they aren't sure about you. And appreciation in lunches doesn't solve that. A relationship investment aimed at an account that has not yet become confident is money you're never going to get back. And that's a common misallocation I see. The order also shows where your money is going now. Most suppliers spend the bulk of their effort. Promising reliability, responsiveness, which are levels below confidence. And your customers assume that. they just expect you to be reliable, responsive. So your marketing and communications telling them you are doesn't really do anything for them. Nothing at that level wins an account. Now, if you're not reliable and you don't communicate, well, yeah, that's a problem and you can lose an account. But it doesn't drive growth. This explains a pattern I see all the time. A company launches a relationship program. We're going to go out and visit our customers. The executives show up. The account team puts in real time. And growth doesn't get better. The numbers don't move. So what everybody assumes is that this relationship work, hey, that isn't paying B2B. It's more rational. No. What happened is they aimed at those accounts that were still unsure whether the basics would work. Those customers were waiting to see whether the next complicated problem will get handled. And nice lunches, dinners, meetings didn't solve that problem. So fix confidence first. And once you've done that, once your customers are confident, then invest in relationship because that's when it paids. Do them in the wrong order, and neither one does. Now, do be to be better was right at the company level. Because the exact emotion that predicts buying into your account is yours to find. Confidence, feeling valued, that works across all organizations. And you can go ahead and use it. But there may be a separate one that is more important for you. And what's changed since the book came out is now you have a sequence and know which end to test first. If you have clients who are have experienced a number of delivery issues in the past. Then let's look at confidence. So that's a leading indicator of the revenue of those accounts. And then once they got there, feeling valued becomes the leading indicator of more explosive growth. And feeling valued is more concrete than it sounds. For example, it's whether your customer would say you know their business and you treat it like it matters. Reliability is a cost of admission. It's not a differentiator and it doesn't drive growth. Customers only need their supplier to meet expectations of price, reliability, and quality, and they'll maintain with them. Meeting that bar keeps the business. And exceeding it on these rational factors alone, that's not going to win you new volume. The hard part is that creating a feeling of feeling valued is harder than it sounds. Your account owners want to answer feeling valued because confidence points at operations, and operations is a team they don't manage. So your account owners are going to really focus on how do we get customers to feel more valued. And as I already talked about, it doesn't work. Confidence is won or lost in what happens after a problem. So if you're a CMO or chief commercial officer listening to this, yeah, you don't own the teams that solve it. And that's a challenge. But it's a challenge we need to resolve. So we've started to counts this way with other companies, and we find that once we actually activate the teams and we first work on creating confident customers, then we bring in the relationship work, that's when it starts paying in volume. And that's tinture truth number 111. Reliability is the cost of admission, not the differentiator. Customers only need their supplier to meet expectations of price, reliability, and quality. Meeting the bar keeps a business, exceeding it on rational factors alone won't win you new volume. So party relationship budget may be aimed at accounts that are not ready for it. If I could give you just one suggestion, it's ask your sales team to take your five largest accounts and have each relationship owner pick the one that's missing: confidence or feeling valued. And then bring those answers to you. Solve confidence first. So if most of them say confidence that spending is a then your spending is aimed at the wrong level. And you can pause that relationship work and tell the basics work. You can learn more about this at heart of the customer.com. And this comes from the blog post called What Has Changed Since Do B2B Better. Hope you enjoyed this episode. Follow it wherever you get your podcasts or on YouTube or LinkedIn. And lastly, give me your feedback. what landed, what didn't, what should I talk about next? And What did your sales team say about your five largest accounts? Email me at jim@heartofthecustomer.com.