How can you make your business customers more loyal, especially when times are tough?

It’s not hard to imagine all kinds of bad things happening due to the economic situation, but that’s all it is: imagination. During tough times, great things can happen. And mostly, because, while everyone else is pulling in, a few others will be having a huge strategic impact upon current, new, and future customers.

In the b-to-b arena, this fear and the opposite opportunity for growth are even greater than for consumer products marketers.

Imagine this:

You sell to businesses, and (as everyone else experiences) they regularly put you through the meat-grinder on both price and other “support” – what they mean by that is promotion and advertising allowances, special promotional discounts, and other profit-robbing special “give-backs. You are used to walking in, hat in hand, expecting to be given a list of expectations (read “demands”) of what you must do to keep the business for another period.

Then, suddenly, everything changes. You walk in and the buyer expectantly invites you to sit down. He can’t wait to hear what your company is up to, so they can “ride your coattails” to greater success. He can’t wait to hear every word you have to say, so he can figure out how to take advantage of what you are doing. Demands? No, he just wants to know how he can get the benefit of everything you are doing, so he can become even more successful.

Sound ridiculous? Impossible? It may be beyond anything you’ve ever experienced, but it’s not only possible, but it is also probable… if you understand what can drive such behavioral change.

I’ve personally seen that happen so many times, I can’t even count the occurrences. What was previously an adversarial relationship suddenly becomes one of mutual benefit. It happens because the customer is in pain and can’t solve it on his own (like right now with a tough economy and a lot of fear among your customers’ customers). He needs help. Can you provide it? If so, all the self-assurance and arrogance you’ve typically seen from those buyers starts to become a lot more pliable.

Yes, they will still start out hoping to make a profit “the easy way” by taking money from you, but when confronted with a confident, Alpha-focused supplier, they are very open to help that can benefit both of you.

Alpha Innovation focuses upon identifying unmet or under-met functional needs and creating solutions that incorporate ego-satisfaction, so that the buyer comes out feeling like a big winner. It sounds so simple (and in many ways it is), but the discipline to not create functional solutions without ego-satisfaction is so difficult for most corporate teams fall short most, if not all, of the time.

The process to achieving this blend of functional needs satisfaction and ego-satisfaction is fairly straightforward; it’s just outside the realm of experience in most companies. Or, if it has been experienced, it has happened more by accident than by intention.

Understand firstly what “ego-satisfaction” is. Ego-satisfaction is accomplished when a person feels good about himself and when he feels that others feel good about him when he buys or uses your product or service. These two aspects are called “Self-Satisfaction” and “Personal Significance” in The Alpha Factor. A person feels self-satisfied, when he believes he is smarter, wiser, more powerful, more fulfilled, more knowledgeable, more appreciated by the company marketing the product or service, more capable of doing the job for which he is paid, etc. A person experiences personal significance, when he thinks others view him as any of those attributes mentioned above and when he believes others may either envy him or aspire to be like him.

Now, consumers are reluctant to admit such things. Business owners or buyers often are not reluctant to admit those desires, especially the self-satisfaction list. The trick is getting beyond the demands the buyer feels he must present to the real hidden needs that he (or his boss) have but that he doesn’t believe can be solved by a supplier.

For instance, …

• Most businesses would love to have ongoing information that will make them capable of being more competitive in the marketplace.
• Most businesses would also love to have a supplier, who helps them grow personally and corporately. That means being a source of solutions that help them grow beyond the direct impact of buying or selling your product or service. Help them get more business beyond what you directly offer, and your value skyrockets (yes, even among those tough organizations who seem to resent any supplier whose influence appears too great).

These are only two of the most common ways I have seen Alpha thinking drive solutions that provide functional and ego-satisfaction fulfillment.

There are obviously many other functional things that could be addressed, such as better payment terms or delivery schedules, etc. But it is important to understand the difference between these purely functional solutions and the more effective ones listed above. Function-only solutions may make the buyer seem happy for a short time, but…

• Any other supplier may also be able to provide that solution (or eventually create the capability to provide it) and
• The buyer maintains “control” of the solution, so you get minimal sustainable benefit from either offering or providing the solution. The buyer thinks he solved the problem, not you.

By using an Alpha-focused solution, you also generate greater competitive control. I have yet to see a competitor easily overcome Alpha-focused solutions, simply because of two factors:

1. The personal and business-to-business relationships established are very strong, because of the great ego-satisfaction created, the idea of dependence upon you generated, and the fact that the buyer would not want to reveal his level of need to anyone else (he fears that he might lose the appearance of control by revealing it), and
2. Competitors can’t see the ego-satisfaction part of the solution, so, when they try to copy your effort, they will invariably focus only upon the functional aspects without the same success. Your ego-satisfaction elements are “invisible” to competitors, because your customer will not reveal that he either had such needs or had them addressed.

The most important factor

Ego-satisfaction is the critical factor. The functional solution is only the “vehicle” or “conduit” for providing ego-satisfaction, but without the ego-satisfaction element there is no Alpha dominance. We saw it over and over again as we studied Alpha companies, but we saw it play out even more clearly as we tested the theory with real companies to create growth.

It is absolutely critical, however, to understand that in b-to-b situations you need to initiate the solution. You cannot wait to respond to your customers’ demands for help. It is only through recognizing the need without the customers’ suggestion and providing a solution that goes to the heart of ego-satisfaction, while also solving a critical functional need, that it works.

If the customer suggests it, then there will be no ego-satisfaction credited to you, no matter how much reward the buyer gets for the results. You must be the proactive agent of ego-satisfying growth. Otherwise, he “owns” the solution, and you are just the supplier who was required to provide it.

So, if you are like most b-to-b marketers who focus upon responding to customer needs, you have already undermined your ability to become an Alpha. You must become the driver of expectations, not the responder to them.

Growth during tough times

Don’t believe that tough economies are a bad time to invest in growth. They are, in fact, the very best times. Just as Warren Buffet once said, “When everyone else is fearful, be greedy. When everyone else is greedy, be fearful.”

Your b-to-b buyers are hungry, and they are getting hungrier. Use Alpha Innovation as the model for driving new growth now, and you will benefit more now and later. Hide and try to wait it out, and you will stay right where you are or be left behind by an Alpha innovator out there who is “invisibly” taking dominance away from everyone else.

Here’s a real practical way to approach this:

Since most of your sales maintenance will come from existing customers during an economic downturn, start by segmenting your existing customers. Divide them simply by those who want and accept such innovative ideas and those who don’t. Don’t assume that, just because you presented some functional ideas in the past that were rejected, those same companies will reject ego-satisfaction focused ideas now.

How to create the “right” innovation –

• Go beyond the obvious solutions to discover ways you can help them address broad business development needs – they need new business as much as you do. Especially look for problems that your customers believe are “unsolvable.” (Anything you do that will help your customers generate more business overall is attractive and unexpected. Obviously, you need to make sure your product or service is at the core of that, but the benefit obviously provides broader rewards to them.)
• Look for ways to make the real decision-makers responsible for profitability (and who also have sway over the buyers) feel smarter, more powerful, more likely to get promoted, and more influential by allowing you to help them.

What will come out of this process of discovery and ideation are ideas that may cover a range of business needs that you can help them address, such as ways to build store traffic for retailer customers or ways to create competitive advantage for manufacturing customers. These ideas are only the starting point for developing ways you can use your product, your advertising, or your market influence to help them grow their business.

What NOT to do –

• Don’t allow internal nay-saying to stop the process until you have gone far enough to discover ideas that will work (It always looks hopeless early in the process – don’t fall into that trap. The biggest barrier to your success is your own unwillingness to go beyond what you have experienced in the past.)
• Don’t allow an internal go/no-go decision to be made without actually field testing these ideas with real customer decision-makers (not just the paid buyers). (Pick a few that you think would be open to a test and make sure they understand the intent to help them grow beyond what is directly attributable to your product or service. If you have not hit on the right ideas, start fishing more deeply for what their real needs are. Once you hit upon the right needs with a workable solution, they WILL respond positively. Who would not wish to gain benefit from someone else’s investment? And who would begrudge the supplier of such solutions to not also profitably benefit from them.)
• Don’t allow every salesperson or division to try this at once. (Only a few will have the self-confidence and influence that will lead to success on the first try. Encourage those few, and their success will spur others to try where they unconsciously undermined their own efforts before.)
• Don’t fall into the trap of believing you have to sell or respond to every customer you have had in the past no matter what they demand of you. Although it frightens most salespersons to hear this, saying “No” is often the best path to future success, especially if the customer making the demands is hurting.

For those companies who respond negatively to such ideas, you have three choices:

1. Tap relationships you have at higher levels among real decision-makers with a practical appreciation for the company’s broader business needs. Present these ideas with as strategic a perspective as possible that transcends the limitations of just what your product offers. (I have seen negative-responding buyers come running back one day after a higher-level executive received information about a strong strategic idea from an equally high-level executive in my client’s company. And the buyer could not hold a grudge, because the directive came down to him and the information had been provided high-level executive to high-level executive.)
2. Create a lesser plan for these negative responders that still attempts to generate some broader objectives that will be noticed by higher-level management.
3. Ignore them, and focus upon those companies who want to get help that benefits both you and them. (Some of the most productive strategic “promotions” we ever used with companies was to make sure these uninterested companies saw the benefits gained by those companies who accepted help. Typically, the next year, these negative responders were begging for the help they turned down earlier.)

For those companies who respond positively, make sure that what they get is visible to competitors and makes those competitors want the same thing from you. Then you have the leverage to both set expectations and drive new ones.

For those on the fence (who won’t take the plunge and try a test), really make sure they see what the best supporters of your proposals are getting and how they benefit from it.

Throughout the 15-year Alpha Factor research project, I helped companies grow through three recessions. One of the reasons the process works so successfully is because most companies refuse to believe it can work. They never try. They pull back and follow the pack. And they leave an open door to the few companies who use Alpha Innovation to create a stronger, more prosperous future for themselves and their customers.

If you want to better understand how the Alpha model works in all types of businesses, you need to read The Alpha Factor. Or give us a call, and we can help you uncover the opportunities for Alpha growth in your category.