3 Things You Can Do Better In Customer Engagements

It’s a new year, which means you’ve probably made some resolutions. And, if you’re like me, by February those will be history. But here’s one you need to make and keep. Improve your customer engagements so you can effectively persuade your buyers to execute your plan to drive change for your brand at a lesser cost—which means more profitability to you.

So this sounds like an admirable resolution, right? But how do you actually make it happen?

First, you need to recognize that customer engagement requires you to persuade a buyer to agree with your proposition. In order to be persuasive, you must demonstrate how your plan will support the retailer’s goals, not just yours. Step out of your own head and get into theirs. The buyer is getting paid to drive the retailer’s strategies and commercial objectives, not yours. “What’s in it for me?” must be adequately answered. If you can’t do this, you’ll end up conceding to the demands of the retailer and your objective of building success for your brand will go the same way as your goal to lose weight, stop smoking, or some other faded resolution.

There are three ways to solve the customer engagement challenge.

1. Understand and reflect your buyer’s KPIs and propositions.
Every buyer has key performance indicators (KPIs), and they’re fairly consistent from one retailer to the next: improve margin, category growth, and stock holding. In other words, these buyers are charged with making more money, selling more products, and holding less inventory. Your strategy needs to support any or all of those objectives. If it doesn’t meet at least one or, worse yet, undermines a KPI, you’re likely to get a “no”—and that translates into you giving higher margins and paying more fees.
It’s critical that you know the KPIs. Don’t guess. If you don’t know, ask. This is your measuring stick so you need to know how your customer is evaluating you.

You also need clarity. Knowing that the KPI is margin is not enough. You need a precise measure. What’s the margin they’re seeking? Get that number. If, for example, your customer wants 12 percent and currently the margin in your brand’s category is 11 percent, you need to be equipped with this information. If the KPI is sales growth, find out how much. If your buyer says the KPI is to increase category sales, ask which category he’s looking to grow; how is it defined?

Once you have this knowledge, be prepared to clearly articulate how your activity or plan will help this customer reach his goals. The better you support a buyer’s KPIs, the greater your success.

2. Utilize your consumer and shopper understanding to build a compelling proposition.
Just as your knowledge of the buyer’s KPIs will demonstrate that you are focused on supporting this retailer’s goals, your understanding of your brand’s consumers and shoppers will show that you grasp how their behaviors impact the path to purchase in-store. The first two steps of the 5-Step Shopper Marketing Model articulate that you must be tuned into the mindsets of your desired consumer (the person who actually uses your product) and the shopper who purchases it.

When presenting your plan to the buyer, clearly demonstrate the consumer demand, because that’s the trigger for the shopper’s interest in making the purchase. Then you must: (1) identify the opportunities you are creating for this retailer to capitalize on the consumer’s desire; (2) show how your plan will change shopper behavior so that it can meet that demand; and (3) articulate the implications for the retailer in this scenario. Integrate these three ingredients and you will have a winning proposition.

3. Calculate the true financial benefits of your proposition for the retailer.
Anything you do with your brand is going to have an impact on other brands, skus, and categories. The retailer will certainly weigh your proposition in this context. Therefore, you need to understand how and where your plan is going to steal from another brand’s share or even cannibalize your own brand portfolio. You’re not supporting your buyer’s KPI to increase category sales by taking market share from another product on the shelf. If you can’t demonstrate the incremental benefit of your plan on the category overall, you need to rethink it. Of course, if you steal market share and your retailer is making a higher margin on those sales, you support another KPI.

Take the time to learn: (1) how much this particular category or segment is selling today; (2) the actual value of the expected results from what you are proposing to do; (3) where your sales are going to steal from; and (4) if the value is going to deliver incremental sales to the retailer. If you can’t define these four points, expect a tougher negotiation.

When you can bring these three aspects into all of your interactions with your trade customers—whether on a sales call with a key account manager or an annual business review—you will significantly reduce the cost of concluding a deal and improve the chances of excellent execution.

By: Toby Desforges

Article Directory: http://www.articledashboard.com

Recognized as a revolutionary thinker in shopper marketing, Toby Desforges is co-founder of engage, a global consultancy that leverages the power of a unique vision of shopper marketing and customer management to deliver better brand returns. A sought-after speaker, Toby has worked in line management and consultancy across Europe and Asia with leading companies including PepsiCo, Mars, Sony, Danone, Tesco and Fonterra. He is co-author of The Shopper Marketing Revolution.