I recently spoke to a group of Banking Chief Marketing Officers at the CFG summit in San Francisco.  My compliments to Pat Scanlon who organizes the group to bring such a high quality program together.

I asked the group of B2B Marketing leaders to pair up and identify the biggest issues that they see in their respective organizations to build out customer engagement at the decision maker level.  The main challenge:  “Gaining executive buy-in”.

This issue is not new, and similar to other company initiatives and transformational programs whether you are implementing a new CRM system, putting your strategic plan in place or implementing a customer advisory board.  Gaining executive support is critical to success of any transformational program.  Here are three quick ways to gain executive buy in.

Show me the money
Customer advisory boards (or councils) and executive level customer programs will yield an increase in revenue from the accounts participating in the program.  Imagine if every customer on your advisory board would buy all the products that you offer and/or fit their business.  Experience tells us that revenues from advisory board members can increase anywhere from 10 -100% - a phenomenal ROI.

Make it easy for executives to engage with customers
Most executives are so busy that they don’t get a chance to engage with top customers.  A typical customer advisory board meeting allows them to engage with a dozen or so customers in a meaningful manner – all at once.  The customer advisory board can eliminate a dozen separate customer visit trips, making great use of executive time.

Make better decisions
All executives want to make better decisions, more quickly and more confidently.  Engaging customers to help validate key decisions will either provide executives with confidence in the decisions – or alter the course and set a clearer path for success. 

In my experience, when executives are presented the key benefits and ROI for a program – they will support the initiative.  The onus then moves to the implementer of the program to deliver the results. 

I'm a Netflix subscriber, so, when I received my "personalized" email from Netflix CEO Reed Hastings on September 19, with the first line stating, "I messed up. I owe you an explanation," I thought to myself, "Too bad Netflix didn't have a Customer Advisory Board!" 

Hastings said that he should have been more communicative about the changes and why the company was making them, which he said was that the two divisions were becoming very different businesses, and the company wanted each to grow independently. Enter "Qwikster".

Then, on October 10, I received my second "personalized" email, this time from The Netflix Team, informing me that it was clear that many Netflix members didn't care for the "two websites" idea, so they were going to keep Netflix as one place to go for streaming and DVDs - no change: one website, one account, one password ... in other words, no Qwikster.

Wow ... again I thought, if only Netflix had a Customer Advisory Board.  They could have avoided all of the above mess ...  they would have saved themselves much time, effort, embarrassment, lost revenue, and lost subscribers.  With a CAB, they would have proactively sought feedback and learned how the market would react to their "two separate websites" idea. Additionally, CAB members could have provided guidance on how best to communicate changes to their customers.  

A recent LA Times article stated that Netflix shares recently plummeted nearly 35% after it reported a loss of 800,000 U.S. customers in the third quarter. Even more troubling is that the defections have continued through October, leading Netflix to predict lower-than-expected growth through the end of 2012.

You would think it obvious that a price increase of up to 60% would not bode well with customers, but add to that the rebranding attempt of its DVD service, and you have a recipe for disaster. Still, had these ideas been vetted to a group of customers in an Advisory Board setting, there is no doubt Netflix would have heard the "voice of the customer" loud and clear and could have avoided the losses they have experienced.

Customer Advisory Boards have proven results for ROI.  Our clients not only see increased revenue from CAB member companies, but also receive guidance on how NOT to invest dollars in the WRONG places.  As an example, a new product in development was presented to members at a recent CAB meeting for feedback; it was "nixed" for being off-target and simply not a fit for the company.  That one recommendation alone saved our client $2 million.

Just think what a CAB could have done for Netflix ...

Are you a B2B company looking to achieve sustainable, predictable, profitable growth (SPPG)?  Referencing The B2B Executive Playbook by Sean Geehan, SPPG is the holy grail of goals for any B2B organization.  Throughout my career, I’ve observed three fundamental elements that will enable the realization of SPPG for B2B organizations:  Market Driven Strategy, Customer Engagement and Internal Alignment.  

Customer Engagement is the key to transforming the organization to drive sustainable, predictable, profitable growth. In the B2B world, customer engagement is the fundamental leverage point that allows an organization to foster two-way communication and connect the organization to the heart of its success - customers and sales.  During the sales process, and subsequent working relationship with customers, there are countless opportunities to engage with decision makers for dialogue - both outbound (ie. awareness and selling) and inbound (voice of the customer and market insight).  With the right environment and process, customer engagement is the cornerstone to gather insight that drives a market driven strategy and internally aligns the organization for success.

For the B2B Company, the magical moments that lead to company transformation are found within the engagements where decisions can be vetted and committed.  These successful customer enagagements primarily begin with a customer advisory board. Additional B2B customer engagement programs are needed to deliver other successful components: Breadth, Depth and Engagement Type.

Breadth:  The breadth of customer engagement in the B2B space is all about how broad your reach is to touch and engage your customers.  A domestic based company would need to reach all corners of the US to drive success of customer engagement.  Likewise, an international or global company would need to cover the corners of the earth.  Key decisions need to be made in those markets where you must invest to be successful.  Do you open an office in Dubai because it’s a hot market?  Do you focus on specific verticals to target and align to your regional or global breadth?  The breadth of the markets you focus on should align to the company strategy and growth opportunities. 

Depth:  The depth of your customer engagement programs includes the levels of engagement you have within your accounts.  We typically see that B2B companies engage with their customers at three distinct levels: the user level, the operational (influencer) level, and the executive (decision maker) level.  Customer Engagement at each of these levels requires different approaches.  For instance, a User Group meeting in Las Vegas won’t be a place to invite executive decision makers however, an industry trade show focused on an operational process would be a great place to meet and engage influencers.   Executive/decision maker programs in turn must be well thought-out, planned and executed to perfection to engage the right audience in the right manner…and ensure that they will return in the future.

Type:  The type of program refers to the engagement being on a 1-1 basis; a 1-few basis; or a 1-many basis.  Examples include:

• One to One:  Executive Sponsor Programs; Account Based Marketing; Account Based Innovation; Major Account Programs, etc.
• One to Few: Roundtables, customer advisory boards; CEO dinners; small summits
• One to Many:  Conferences, trade shows; summits; industry or partner events
  

In determining the type of customer engagement, careful consideration should be taken to determine the most effective method to reach your targeted buyer, advance the positioning of the company, gain both insight as well as get your message delivered. Each of these programs require levels of structure as the complexities of the programs can vary.  Our research has found that the top programs for advancing sales are executive summits while the top programs for driving retention and loyalty are executive customer advisory boards.

If you and your company are on the path to drive sustainable, predictable, profitable growth, an advisory board is a great place to start your journey and customer engagement approach.  If you’re a company that already has these programs or elements of these programs in place, often clearly defining and rationalizing the value of each program is important.  Making the most of every initiative is what separates good companies, and good marketers, from the average.

In the B2B world, there are three elements that will enable the realization of sustainable predictable profitable growth (SPPG), the holy grail of goals for any B2B organization.  In Sean Geehan's book, The B2B Executive Playbook, he identifies the three fundamental elements for B2B organizations: Market Driven Strategy, Customer Engagement and Internal Alignment.   In the past I’ve covered the overview and connections for these elements – today I’m focusing on the Market Driven Strategy component.

Market Driven Strategy
Many companies begin to develop their annual “strategy” by starting with a budget and a target for growth.  That’s an inside – out approach.  A market driven strategy is an outside – in approach, where insight about the market’s direction, velocity and changing needs are the critical components in the planning phase.   B2B organizations are in the unique position to capture insight into their strategies and market direction by engaging with their top customers to gain qualitative market insight (for example, in customer advisory boards and account based executive sponsor programs).  This insight can be relied upon to provide directional market guidance.  Other market research based customer insight can be conducted to capture further quantitative evidence of market movements, direction and needs.

Here are the four keys I've found to developing market driven strategy:
1) executive sponsorship by the CEO or BU head
2) alignment by the leadership team to the top priorities the market demands
3) insight from top customers and key growth segments
4) integration in to the strategic planning process

Case Study
When Springer Publishing engaged with decision makers in their markets, they uncovered growth opportunities in the e-publishing markets for research institutions.  Springer was able to identify the products, markets and customer segments where opportunities arose and weren’t being served today, and embed the opportunities in to their strategic planning process. 

Market Driven Strategy is dependent on two other key elements for success:  Customer Engagement and Internal Alignment.  Check out my other posts for more perspectives on these areas.

Show Your Customers You Are Listening
One of the biggest keys to success with your Customer Advisory Boards (CABs) is to identify the actions and/or next steps your organization will take following the meeting. 

Your customers devoted their time and talent, and spent a few days with you to engage in discussions to help you better understand "their world" - their challenges, their concerns, what is working and what is not working - and what the future may hold for both of you.  In return, your ultimate responsibility is to respond with specific actions you will take based on their feedback.  Taking action lets them know their time was well spent, you were listening, and you took their ideas and recommendations very seriously.  Taking action will keep them coming back to participate in future CAB meetings.


Plan Ahead for Post-meeting Activities
Even before your CAB meeting takes place, you should schedule an organizational planning meeting a week or two after the CAB meeting.  This prepares your stakeholders for providing their key takeaways and thoughts on how to move forward on member suggestions, ensuring better market alignment.  As a team, determine one or two next steps the organization is willing and able to address.  Ensure you have:

• Support and buy-in from the team
• A plan and structure for addressing the issue(s), with associated timing and milestones
• Accountability from team members to make it happen

Typically within 30-45 days after the CAB meeting, you will want to communicate to the members with a meeting summary and details of your Action Plan.  Send periodic updates on the progress you've made, showing how they have impacted the strategic direction of your organization.  You'll benefit from improved customer relationships and achieve sustainable profitable growth as a result!