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The Power of Trusted Customer Advisory Councils

As seen on Stage 4 Solutions’ Blog. Visit the Stage 4 Solutions Blog here.

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B2B marketing isn’t easy, obviously. There is constant pressure to show measurable marketing ROI, maximize margins and increase revenues. And internally, the competition for budget dollars is often as fierce as it is when fighting for market position. With so many competing priorities, B2B marketers struggle with where to focus their marketing budgets.

For many businesses, the distribution of marketing resources looks something like the left-hand side of Figure 1.1, with 60% of budgets designated to finding new customers, while the remaining 40% are used to foster the relationships that have already been formed with current customers. However, at this month’s Business Marketing Association event (hosted by EMC) we learned from Sean Geehan, President and Founder of The Geehan Group, that profitable B2B firms employ a strategy more closely resembling the right-hand side of Figure 1.1, where 70% of marketing efforts are focused on current customer programs and engagement. The Geehan Group has successfully worked with a number of industry leading companies including HCL Technologies, Adobe, Alcatel Lucent, Dell, Intel and Xerox to implement new marketing strategies focused on Trusted Customer Advisory Councils.

Collaboration With Thought-Leading, Decision Makers Works

When many B2B companies look at their customer lists, they realize that a high percentage of their revenues and profits come from a small percentage of customers.  With a small amount of customers contributing to most of company profits, marketers have discovered a significant need for nurturing the relationships of these few customers, and marketers can meet this need through the use of Trusted Customer Advisory Councils. By bringing together the decision makers of top customers, a number of tangible and intangible benefits are produced, the most important of which include: 1) Future business strategies that promote the welfare of everyone involved can be discussed, 2) feedback and insight into the real needs and expectations of customers can be voiced and heard, and 3) a community or peer group is created between the critical decision makers of the most important customers.

For HCL Technologies, a leading global IT services company, Trusted Customer Advisory Councils continue to be a booming success. Customer retention of Advisory Council accounts is 100% since the program’s inception in 2008. HCL’s source of “reference accounts” has increased by 200%. In addition to the benefits HCL gains, customers participating in these Advisory Council have seen their revenue grow at an average of 1.8 times overall growth of their organization from 2008. And they all continue to leverage their learning across their accounts.

In the end, Trusted Customer Advisory Councils drive revenue:

• Sales close rates for Trusted Customer Advisory Council program implementers increased 21-330%.
• Sales cycle times accelerated by 18-60%.
• Customer satisfaction scores increased 15-31%.
• Referenceable accounts climbed 23-420%.

When top customers refer your business to others as a trusted advisor, new customer acquisition becomes so much easier. How does your marketing budget compare to those in Figure 1.1? What has your experience been surrounding the competition for internal budget dollars? What impact would implementing a Trusted Customer Advisory Council with the decision makers of your firm’s top customers? Please share your thoughts and experiences with us.

Statistics provided by:
Geehan, Sean. “How B2B Marketers Drive Profitable Growth.” BMA Monthly Even. EMC-Santa Clara. 2441 Mission College Blvd., Santa Clara, CA. 30 NOV 2011. Lecture.