A Customer Advisory Board (CAB) or Council, is made up of your top, most strategic customers – whether that equals 7, 12 or 20, they are the driving force of your success. Having a CAB program in place gives the leadership team the perfect forum to meet with these important decision makers.

How Many Many Customers Should You Have Before Forming a CAB?

We’ve delivered CAB meetings with as little as 5 customers to as many as 22 and found that the smaller groups are just as powerful as the larger ones. A good example is a $3B client of ours with 9-10 customers who account for 90% of their revenue. They typically have 5-8 members in attendance at their CAB meetings. Alternatively, another example would be a much larger $20B client with hundreds of top customers. Their CAB meetings typically have 20-25 attendees and we include breakout groups and roundtables, allowing all members an opportunity to provide feedback and share in smaller groups. These very different companies get the same benefits: robust discussions, collaboration, brainstorming and clarity on our client’s strategic direction.

Would a Customer Survey be as Effective as Holding a CAB Meeting?

Nothing really takes the place of face-to-face meetings for better understanding your customers and building relationships. So if you’re considering surveying customers as an alternative to a face-to-face meeting, just know that your results will be much different. Without a ‘live’ audience to provide context to, you’re more likely to get just a ‘snapshot’ on something more specific. You won’t benefit from the dialogue among customers that occurs at face-to-face meetings; there won’t be peer-to-peer sharing and learning; and last but not least, a survey doesn’t offer much in the way of relationship-building opportunities.

Building a CAB program and holding in-person meetings (once or twice a year) creates a “safe” environment for an open, interactive exchange of ideas. While surveys serve a purpose, don’t use them in lieu of a face-to-face meeting – use surveys for more quantitative feedback. Hold in-person CAB meetings to allow members to build on one another’s thoughts and work on solutions together. This peer exchange will also create an emotional commitment, strengthening relationships and improving retention.

With the myriad customer engagement programs so popular today, Customer Advisory Boards (CABs) and Focus Groups often get “bucketed” together, yet they have clear and very different objectives.

Here's a "quick reference" chart detailing some of the key differences: 

Participant Attributes

The diagram below shows the core attributes of participants for CABs and Focus Groups, and another reason why these two programs are so different.

 

 

 

 

 

 

 

 

 

Sample Discussion Topics

And finally, here are some sample topics most common among the two initiatives.

Customer Advisory Board

• Strategy
• Direction of industry
• Organization's goals/objectives to develop alignment
• Discussions on: what services or offerings are missing; pricing/business models; overall product roadmaps; go-to-market programs (sales, marketing); account management

Focus Group

• Reaction to logo/tagline
• Emotional state (look and feel)
• Usability study
• Behavioral patterns/processes
• Product feature/functionality

As you plan your customer engagement programs for 2013, be sure to target the right program format for the input you are seeking.  If you want to gain a deeper understanding of your customers' business, build closer executive relationships, and gain strategic mid- to long-term market insight, a Customer Advisory Board is the answer.  If on the other hand, you need qualitative short-term feedback on a product or branding message; or opinions/perceptions on a concept, service, packaging, etc., then a Focus Group is the right program.

At times, companies can lose sight of the value they gain from Advisory Councils, and for various reasons.  Be on guard—do not let yourself get discouraged to the point where you recommend discontinuing this strategic engagement tool.  Instead, consider an Advisory Council Makeover.

Time for a Reality Check

Assuming you conduct post-meeting surveys with both internal team and council members, what kind of feedback are you receiving? 

• Are your members still getting a high level of value from their invested time?
• Are your stakeholders still getting a high level of value from the insight gained?
• Are overall scores trending downward?  If so, for how long and by how much?

A Makeover is the best alternative, considering a small percentage of top accounts typically contribute the largest percentage of revenue in B2B companies.  They hold the heart of your business in their hands.  And, most of the research-based market insight you acquire is also available to every one of your competitors.  Making strategic decisions based on insight gained from your most important customers is too critical to give up! 

In Part 2 and following, we will address several areas that impact scores and your perception:

       Members:                              

• Overall experience
• Discussions
• Perception of your commitment
• Follow-up
• Willingness to partner further

       Internal Team:

• Pre-meeting preparation
• Overall experience
• Insight gained
• Application
• Between-meeting interaction

 

Earlier this spring, Kim Hammond (from QTS) and I had the opportunity to present at the Loyalty 360 Engagement Expo.  The audience was highly engaged as we talked about some of the common challenges organizations face Achieving Client Advocacy in the B2B World.  The top five challenges discussed were:

1)       Being focused on the wrong customers

2)       Being focused on the wrong level within accounts

3)       Disproportionate marketing spend

4)       Retention

5)       Profitable growth

As we shared there, building true advocacy comes from engaging your most important accounts at the decision-maker level in a meaningful way.  Market leaders must consider the opportunity of shifting their marketing spend to 60% on retention and 40% on acquisition.  In most organization, the reverse is the case.  In addition, investing 35% at the decision-maker level of the most important accounts will provide marketing leaders the desired retention and profitable growth.

I was energized by Loyalty’s research that came out in 2012 for marketers.  Their research shows the top two objectives for marketers in 2012 are, 1) customer retention, and 2) profitable revenue.  This reinforces what the IBM CEO and Fournaise Marketing Group studies said, which basically came down to marketing leaders need to be focused on the business, not the brand.  They need to focus on building the ROI if they want to earn a true seat at the C-suite table.

Cheers to a sustainable, predictable and profitable 2012 for all marketing leaders!

 

The Need for Customer Loyalty and Retention

Previously, executives representing a business would pay their most valuable customers a personal visit in their office, indulging them in meaningless talk on an assortment of different subjects that have little to do with the objectives of the business and everything to do with the interests of the customer. Executives even took their clients out for lunch or dinner, encouraging the establishment of a strong mutual bond between the customer and the client.

There is no denying the fact that the fastest way to direct the corporate tide towards substantial growth is by shifting the strategic focus to the business’ core customers. However, in order to achieve this objective, prioritization of efforts is essential, as it prevents the resources and goals of the business from dilution. Once the business has drawn a fine line separating its strategic customers, the next decision involves how to maintain their interest and loyalty towards the business.

Executive Sponsor Programs

Executive Sponsor Program (ESP) is a comprehensive plan devised by a business ‘key decision makers with the aim of engaging the business’ core customer in a one-to-one relationship that is set well beyond the parameters of a sales transaction. It is therefore an initiative to influence a business’ client relations so that greater penetration of existing accounts can be achieved. This, in turn, increases the retention rate of the business.

Generally, an Executive Sponsor Program involves selecting some of the most influential executives working in an organization and assigning them target accounts of core clients. The executives are responsible for establishing, fostering and sustaining good relationships with these core clients through healthy two-sided personal communication, which is carefully planned to be in the mutual interest of both sides. Deepening the roots of a healthy relationship of a client with the business encourages customer loyalty.

An Executive Sponsorship Program has its own designated manager, the role of whom is to provide executive sponsors with opportunities throughout the year, so that it aids them in their quest to meet one-on-one with their key client executives. The meetings are organized as the ideal opportunities for executive sponsors to interact freely with customers, also encouraging discussions on the most pressing issues that the customer is confronted with.

The underlying focus of these meetings is to identify the means that encourage better cooperation and understanding. Also, comprehensively devised Executive Sponsor Programs encourage round-table discussions on emerging market trends and identify new strategic priorities and directives from both organizations. Generally, the meeting commences with identification of pressing issues, followed by collaborative input and exchange of ideas, aimed at developing concrete actionable corrective measures.

The bottom line of an Executive Sponsor Program is the realization of a higher level of strategic sales opportunities along with increased account retention of key customers. In the wake of increasingly competitive markets, countless businesses have devised comprehensive Executive Sponsor Programs to encourage customer loyalty. However, when devising an Executive Sponsor Program the primary challenge faced by businesses is that of identifying key elements that encourage customer loyalty.

 

 

This week in Orlando, Kim Hammond (from QTS) and I had the opportunity to present at the Loyalty 360 Engagement Expo.  The audience was highly engaged as we talked about some of the common challenges organizations face Achieving Client Advocacy in the B2B World.  The top five challenges discussed were:

1)       Being focused on the wrong customers

2)       Being focused on the wrong level within accounts

3)       Disproportionate marketing spend

4)       Retention

5)       Profitable growth

As we shared there, building true advocacy comes from engaging your most important accounts at the decision-maker level in a meaningful way.  Market leaders must consider the opportunity of shifting their marketing spend to 60% on retention and 40% on acquisition.  In most organization, the reverse is the case.  In addition, investing 35% at the decision-maker level of the most important accounts will provide marketing leaders the desired retention and profitable growth.

I was energized by Loyalty’s research that came out in 2012 for marketers.  Their research shows the top two objectives for marketers in 2012 are, 1) customer retention, and 2) profitable revenue.  This reinforces what the IBM CEO and Fournaise Marketing Group studies said, which basically came down to marketing leaders need to be focused on the business, not the brand.  They need to focus on building the ROI if they want to earn a true seat at the C-suite table.

Cheers to a sustainable, predictable and profitable 2012 for all marketing leaders!

What is Account Retention?

Customer Retention is the measure that businesses adopt to tackle customer defections. The entire process of customer retention has no defined period as it starts with the business establishing a contact with a customer and continues throughout the span of the relationship. Attracting and retaining new customers does not simply relate to a business’ products and services. A lot depends also on the manner in which it serves its existing clientele and the reputation it has maintained in the market.

Why is Account Retention Important?

When you try to replace an account that you have already lost, you waste crucial time and resources while resolutely eating away your profit margin. It is evident from most examples of trying to rebuild lost accounts that the process costs at least ten times more, as newer clients require a lot more resources and attention. When you build a following of loyal customers you get revenue that you can depend on to keep your company’s cash flow afloat while also maintaining your financial integrity.

The Key to Account Retention

The key to account retention is customer satisfaction. The best way to keep accounts is to make sure that you provide personal attention to your customers, provide quality customer service and take criticism and complains in their stride. Your reaction to a problem presented by a customer is the key to determining whether they will stick around or not. You should have the skills to appropriate the sort of reaction that enables your customers to see that you have their best interests at heart.

Customer satisfaction is established through frequent communication. One of the best strategic tools to establish account retention is through a Customer Advisory Board. You have to keep your client up to speed about any steps that you are taking that directly influences them and inform them of the process that you are making on their problems to maintain account retention. Keeping your clients informed reminds them about the significance of their company and the integral role it plays moving forward which ultimately builds strong account retention. 

The Institute for the Study of Business Markets (ISBM) is a center of excellence in the Smeal College of Business at Penn State that is dedicated to expanding academic research and teaching in B2B Marketing and Sales, and improving the practice of B2B Marketing and Sales in Industry. ISBM is networked with researchers, educators and practitioners in business-to-business marketing in companies and universities throughout the world.  

Please join the ISBM and National Bestselling Author Sean Geehan for a special webinar event:

Dominating the B2B World: Sustainable, Predictable and Profitable Growth on March 22, 2012 at 1pm EST

In this webinar, Sean Geehan Author of the B2B Executive Playbook will illustrates the three key differences in the B2B world along with what to do about them. B2B companies aren’t like B2C companies. They don’t acquire and retain customers with Super Bowl ads, Twitter accounts, or cute, little green geckos. To achieve sustainable, predictable, and profitable growth, you MUST follow a different playbook.  

For those who already have a customer advisory board and are critically assessing content and its mutual benefit for your company and board members, agenda-planning is a critical component.  What priority issues loom?  What strategic insight can you capitalize on most with these select executives from your top accounts?

An effective agenda usually contains three to five successfully prioritized areas for discussion that are relevant to your company and your customers.  Make certain the topics address business goals or competitive advantage.  Consider:

• Discussing topics to be addressed at upcoming corporate Board meetings for broader understanding.
• Evaluating product planning ideas before committing deeper resources.
• Obtaining candid input about their perspectives of competitors to perfect that strategy.
• Learning about their major challenges and obstacles for overall strategic purposes.
• Walking through relevant market trends and brainstorming how your company can leapfrog with solutions.

It bears repeating:  These vital customers care about your organization’s success because they have a vested interest in it.  They get involved and give of their time because they want to offer strategic insight. 

BE A STAR.  Invest smartly.  Wisely use precious resources.  Make your board a strategic initiative.

In October of this year the Information Technology Services Marketing Association (ITSMA) held their 18th Annual Marketing Conference and Marketing Excellence Awards Ceremony. Our CEO, Sean Geehan, spoke at that conference on "How Winning B2B Companies Achieve Profitable Growth."  It was exciting to be part of that conference for two reasons:

1. The opportunity for Sean to present the principles of his new book, The B2B Executive Playbook
2. The chance to witness one of our customers receive the ITSMA Diamond Award for Marketing Excellence in the category of Building Client Loyalty and Trust.

That customer is HCL Technologies. Evaluated by a panel of renowned industry experts, organizations were judged upon innovation, execution, and business results - three critical aspects to marketing success.

HCL won the award based on its Customer Advisory Council (CAC) programs. HCL's global, collaborative initiatives involve over 80 of its Fortune 500 C-level customers and thought leaders who convene on a regular basis to advise HCL on industry trends, changing business priorities, and HCL's strategic direction. HCL applies the advice received from Council members into actionable plans that transform business and technology needs, creating more value for their customers. With their customers' help, HCL has achieved 25% CAGR (compound annual growth rate) over the last five years, going from revenues of $1.4B to $3.5B. The CAC also serves as an exceptional platform for HCL's customers and their industry peers to exchange ideas and best practices, and to network.

Awards such as this exemplify the value of spending time with your customers to build solid relationships, gaining a better understanding of their business, and becoming a trusted advisor over time. Customer engagement programs like HCL's Advisory Councils are key drivers for account retention, customer loyalty and revenue growth.

A fundamental reason for the success of HCL's Council program is the internal team leading the initiatives. Executive Sponsor Shami Khorana, President, HCL America, leads the team, stays closely involved, communicates to members, and attends all CAC meetings. Samir Bagga, VP and Head of Marketing, and Gowri Shankar Vembu, Associate General Manager and Head of Global CACs, are equally committed to keeping the Councils at a high-quality and strategic level. They work hard to ensure meeting agendas are robust with relevant, engaging topics, while at the same time giving members the opportunity to serve as "advisors" to HCL.

We at Geehan Group are honored to work with a company the caliber of HCL, and look forward to our continued partnership to help them run world-class customer engagement programs and continue to lead their industry with a market driven strategy, bringing company-wide internal team alignment. Congratulations to Shami, Samir, Gowri and all of the HCL team on this much-deserved award!