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Making 2013 The Year of The Client   

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Executive Summary.

  1. Why this is important.
  2. Customers and Clients are NOT the same.
  3. 140% of your profits come from 40% of your clients.         

pic andrewClients are a business' greatest asset. Or, as renowned management guru Peter Drucker has said "The purpose of a business is to create, serve and retain clients."   

Although there have been major strides in moving towards a greater focus on clients, more needs to be done and in my opinion, quickly too. Given the continued turmoil in the world and SA, more needs to be done by businesses to ensure that they remain sustainable. Ensuring greater client loyalty and the numerous benefits that brings is an important step. After all without a profitable client base there's no chance.    

Clients and Customers aren't the same.

The distinction between a client and a customer is more than semantics. Customers buy a product or service with well-defined characteristics that match their needs with little or no negotiation and discussion. A client in contrast, has a consultative aspect to it. There is a give and take to clarify and identify needs and recommend solutions, jointly. The focus on clients is a deliberate one. If you have customers, your relationships will tend to be narrow in scope. Whereas if you serve clients, you have the opportunity to develop collaborative relationships which need to be based on trust. But a word of caution, not all clients are created equal and consequently different clients must be treated differently.

140% of Your Profits come from 40% of Your Clients.

This statistic from the American Marketing Association in 2010 is frightening but true. Hence some very hard thought needs to be given to client segmentation analysis; especially so that you are sure you make 2013 the year of the client with the right, profitable clients. As a guideline, the following graphic may assist.

Making 2013 the Year of the Client

My experience indicates that most businesses have in excess of 50% of their clients in the bottom right hand quadrant, underperformers. These clients suck an organisation dry. They cost more than they are worth and hence are largely unprofitable. They demand more and pay late. Focus on this quadrant as this is the key to ensuring you have a profitable client mix, as you need to move clients either to the left, the commodity quadrant or up to the partner quadrant. By doing so your client mix will be far more profitable.    So by focusing on the right clients in 2013, here's wishing you a profitable 2013! 

Andrew Clare is Managing Partner of reLiance a business to business relationship marketing practice. I focus on improving client profitability through developing, implementing and measuring sustainable, collaborative business to business relationships.

Cell: +27 83 326 2451, E-mail: This e-mail address is being protected from spambots. You need JavaScript enabled to view it , Web: www.rassa.co.za, LinkedIn: www.linkedin.com/in/andrewclare


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