B2 b crm


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B2 b crm

  1. 1. B2B CRM, A Different Ball Game Dears, In B2B markets, the customer is typically a representative of the immediate buying organization. However, this is changing as many global suppliers try to exert further control and influence along the value chain. Thus, in the automotive industry, vehicle manufacturers face legislation that threatens to reduce the control they have over retail distributors. As a result, many are increasing their CRM spend, in an attempt to build a direct relationship with final consumers. Technology such as mobile phones, Web sites, kiosks and multi-channel devices is enabling this transformation. The need for greater value chain integration has led many organizations to view their suppliers and business partners as customers. Indeed, the prevalence of supply chain management (SCM) and partner relationship management (PRM) application software now available reflects this. The Business 2 Business CRM is a different ball game compared to B2C CRM. Why, What and How? A new type of customer In many B2B marketplaces the decision maker is changing. As a result, many suppliers have relationships with their customers at many levels of seniority and in many different business functions. In the IT industry, IT expenditure was controlled by IT and finance managers. As technology has become pervasive at work and home, it is has moved from being an efficiency enabler to a key factor in business performance improvement. Line of-business executives often make buying decisions. They need a business solution to their business challenge. So many B2B suppliers now focus on developing and sustaining relationships with this new breed of 'integrated business solution' customers. They have developed sophisticated techniques for consultative marketing and selling. Consultative marketing The aim of consultative marketing is to target key decision makers and influencers and promote the supplier to them as a value-added solution provider. Consultative marketing also supports the creation and communication of thought leadership and value-added content through which the relationship is sustained and developed. Consultative solution selling Consultative solution selling focuses not just on the intrinsic value of products and services but on ensuring delivery of value. This requires understanding the customer's business challenges and helping to shape the solution to meet the customer's need. Solution selling also involves being able to articulate the supplier's capabilities and then assessing whether the solution can be provided profitably, before developing it in partnership with the customer and perhaps other relevant parties. Effective Account Management, Possibly Global in Scale
  2. 2. The increasing need to anticipate customer requirements and serve customers more effectively on a global scale requires large B2B companies to further develop their customer management capabilities. Technology clearly plays a key role in the sharing of information and orchestrated targeting of accounts, but equally important are: organization of the ownership of accounts; refined and clearly understood customer management processes; an understanding of the profitability of accounts; An effective incentives scheme. Organization of the ownership of accounts In a company that spans geographies and multiple divisions, there is often ambiguity in account ownership. Where there is ambiguity there is confusion, and frequently the customer will be on the receiving end of a seemingly disorganized service, leading to frustration and dissatisfaction on both sides. There needs to be clear coordination of responsibilities for managing accounts. Where such an exercise has been undertaken we have seen the following benefits: A common language has been established to categorize different account types and the roles and responsibilities of account owners, thus leading to less internal and external confusion. More effective account planning and execution. Customer requirements can be forecast and actively provided for. Improved focus on target and key clients, leading to higher revenue per account manager. Increased opportunities for cross-selling (leading to increased sales per customer). Improved management of account management performance, improving the productivity of account managers. Improved understanding of account management competencies, ensuring that account managers are more effective, leading to greater customer satisfaction, improved retention rates and increased conversion rates for new business. Refined and clearly understood customer management processes Typically, large companies have several different approaches, in product divisions and countries in which they operate, to planning and monitoring account development. Alignment to a common approach assists the development of account strategy and management review, particularly for ensuring continuing contact management across divisions. Processes that must be clearly defined, communicated and implemented across the organization include: Customer profiling and understanding. This equips customer teams to maximize development opportunities with each customer, using a comprehensive profile for each individual customer. A common profile improves sharing of information amongst account teams and ensures that there is a common view of issues and macro trends affecting the future direction of the organization. Account planning and monitoring. This uses customer profile information to develop and detail a business plan, including milestones, responsibilities and key performance
  3. 3. indicators. Measurement information is shared across the organization and used in profiling and in refining plans. Relationship and contact management. This focuses on identification, development and tracking of relationships with customer executives. Typical activities include development of an organization map of the customer, 'pain sheets' and contact planning. The process also incorporates tracking of customer meetings and contacts, to ensure a coordinated approach to managing customers. Opportunity management and execution (including pipeline management and qualification). This focuses on the different stages any sale should go through (however large or small). Having a common approach to opportunity management provides greater transparency of opportunities for senior management and instils appropriate sales disciplines in account managers. Sales management and leadership. This focuses on how executive management tracks and reviews account opportunities during the opportunity management process. It covers mechanisms for reviewing the pipeline, and escalating opportunities up the management chain. Customer satisfaction tracking. This focuses on how customer satisfaction is measured and how it is supported in terms of account management and operational performance. The aim is to strengthen the relationship with customers by identifying and addressing any issues a customer has. It instils a focus on customer satisfaction as a metric. An understanding of the profitability of accounts Many companies are now able to report this, at least on an estimated basis. Having this information: provides a clear understanding of which customers are high or low-value and which must be retained; enables fast decision making, a prerequisite for global account management; provides better information to assist in commercial negotiations with customers; increases clarity on 'cost of sale' and 'cost to serve' issues; highlights differences in profit margin across geographies for the same account; highlights the economic value of certain business locations / routes; assists in evaluating economic value of particular products or services; Provides an input to the personal performance measurement of account managers and teams. An effective incentives scheme Service differentiation will increasingly be in the selling of integrated solutions, enabling the deepening of the relationship with the customer and a move away from the provision of a commodity service. Some customers demand that their supply chain partners operate globally in terms of both operations coverage and relationship management. This means that account teams must be able to operate across country borders in the provision of integrated solutions. To facilitate the move towards a more collaborative environment, it is very important that customerfacing staff are given the correct incentives to respond to customer requirements at a global level.
  4. 4. If the remuneration structure does not sufficiently reward account teams, business outside their domiciled country or division might not be developed, and the selling of integrated solutions at a regional or country/local level will not be promoted. Incentives schemes need to be structured so as to engender the following: encourage integrated solution selling; promote the identification of opportunities for other areas of the company (eg other products/services and in other geographies); Support the global account management roles and encourage account managers to act in a way which is consistent with the desired roles and responsibilities as described in the 'ownership' section above. The B2B CRM will get you to Last Mile in the Supply Chain, How? See it in Next Arcticle Loving P&C DC*