1. Building Partnering Relationships
Chapter 13
Building Partnering Relationships

2. The Value Of Customers
Maintaining strong relationships with the customer is important
(Existing accounts contribute a large portion of sales)
Selling to satisfied customers not only costs less than acquiring new customers but also is easier
Customers are worth more in terms of revenue than some salespeople recognize
CVS – Customer lifetime value – combined total of all future sales (typically discounted back into current dollars).

3. Value of Customers
Consultative customer-oriented sales approach – shown to improve customer retention & profitability
Another study – finds average company loses 20-50% of its customer base every year, and the rate is increasing!

4. Relationships and Selling
Relationship marketing – many definitions
For selling, it means creating the type of relationship that best suits a customer’s need
Behavioral loyalty – purchasing same product from same vendor over time (habit)
Attitudinal loyalty – emotional attachment to a product

5. Types of relationships
Solo exchange – one time purchase
Example: car trouble out of town
Functional relationships – long term relationship characterized by behavioral loyalty – (habit or routine)

6. Partnerships
Relational Partnerships – close personal bond involved – know small details can be worked out
Strategic Partnerships – both make significant investments to improve profitability

7. Managing Relationships
Some companies want a market exchange, some want a functional relationship, and others want a strategic partnership.
Size, access & image, & access to innovation help drive partnerships3

8. Choosing Right Relationships
Size – example: Keyser Group & McDonalds – worked for decades -P.348
OR J.C. Penney and Martha Stewart
Access and Image – SRI (software company)– can provide access to very specific markets – P. 350
Access to Innovation – Lead users face & resolve needs months/years ahead of others -HEB & (RFID)

9. Phases of Relationship Development
Awareness
Exploration
Expansion
Commitment
Dissolution
Note: Research shows the middle three stages are the most important!

10. Characteristics of Successful Partnerships
Mutual trust
Dependability
Competence
Customer Orientation
Honesty
Likability
Open Communication & Common Goals

11. Successful Partnerships
Commitment to Mutual Gain
Organizational Support
Structure & Culture
Training
Rewards

12. Selling Yourself Vignette
Deeper relationship – Student Ambassadors!