Customer needs are constantly evolving, and your success with customer retention depends largely on your ability to adapt to changing circumstances. Developing this kind of agility also results in new opportunities to build incremental revenue.
First, let’s talk about what causes customer needs to change. There’s always some driver, such as changes in the marketplace, the competitive landscape or regulatory environment. Technology is another key external driver that accelerates the rate of these changes. Advances in alternative energy technology, for example, could have a significant impact on your customer’s business model, products and services.
Customer changes may also come from intrinsic or self-motivated innovation. A company like Sonos provides a useful example. Plenty of companies make wireless speakers, but Sonos has developed a variety of innovations on the basic technology. Its system allows you to have 30 independent wireless speakers ranged around your house, and manage and sync them from a smartphone or other mobile device.
Here are seven ways that taking an agile, adaptive role allows you to capture incremental revenue:
1) New product opportunities: By aligning with your customer’s needs as they introduce new products, you’re able to expand your supply opportunities to support them with new products.
2) Capturing a greater share in each opportunity: When you demonstrate willingness to adapt to your customer’s needs, they’ll see you as a trusted partner. Because you’re moving with them, you’re becoming a preferred supplier, giving you an opportunity to present the most comprehensive solutions possible.
3) Access to new markets: If your customer is taking a product into a new market, they are likely to need help in addressing that market’s different requirements. This gives you a larger role in your customer’s business, and the new market is likely to increase your volume and activity.
4) Emphasis on value, instead of price: When you’re agile, you tend to be out front, adapting to needs and ahead of the game. This gives you a better opportunity to capture the true value of the solution you’re providing.
When you have a lot of competition, pricing and cost become important topics. But when you’re out front and agile, the customer knows you’re uniquely positioned to meet their business needs, increasing their willingness to pay for the value you offer.
5) Building innovation capabilities: Agility helps build a culture of innovation in your company, which drives additional product and service development. It helps you become better at identifying and delivering new products (both internally and externally) to drive revenue.
6) Increased market share: Agility gives you a first-mover advantage that results in a greater share of wallet. For example, let’s say your customer currently has a product that holds 19 percent of that marketplace. If you’re supporting their efforts to grow and their market share expands from 10 to 15 percent, you get a 50 percent boost in your activity.
7) Attracting new business: Finally, agility is a magnet for new customers. Once you demonstrate your agility with one customer, it creates a reputation that makes other organizations want to do business with you.
Whatever the reason for your customers’ changing business needs, there’s a great advantage in helping them meet the challenge, serving as a trusted and agile partner.
Learn how PROS Sales Effectiveness Solutions could help your organization improve customer retention and capture incremental revenue.