Learn to convert clients into long-term partners by establishing a relationship based on shared trust and mutually beneficial expectations.

The times, they are a' changing: Customer expectations are on the rise, and the competition is stiffening. Simply stated, purchasing decisions are being made in a different light. Today's customers are seeking customized goods and services delivered with added value. And, to survive and prosper in light of these changing expectations, smart companies are beginning to alter their sales schemes to accommodate increasing consumer demands.

These new standards of service are taking the customer/supplier relationship to a higher level. Rather than the predator-and-prey approach of years past, companies are turning customers into partners. But let's not mince words. Experts say the term partnering is overused and stress that a true partnering relationship requires change on both sides of the table.

Neil Rackham, best-selling author of "Spin-Selling" and co-author of "Rethinking the Sales Force," says a true partnership is a redesign of the boundary between the companies and their customers that results in the creation of value. Indeed, successful partnerships are steeped in reciprocal value and doing more than just "selling" by going above and beyond what you are paid for by your customer.

Transactional vs. Consultative Selling

The mode of sale is evolving, and customers are dividing themselves up into distinct types, each looking for something different from a customer/supplier relationship. Turning your customers into your partners will mean climbing a different ladder, one of consumer expectations and trust.

Transactional customers represent the lower rungs of the ladder and, therefore, the easiest to reach. However, they are also more difficult to retain. Transactional customers know what they want: the best price, the most convenient delivery and a hassle-free encounter with the sales force. Transactional customers view products as mere commodities and are, therefore, less likely to become loyal consumers.

As you move up the ladder to clients that are less accessible and more demanding, you earn customer trust and loyalty by generously sharing your expertise and swiftly solving their problems. Experts agree that in order to realize a long-term partnering relationship with these customers, companies must adopt a consultative approach to selling.

"Consultative customers don't want an off-the-shelf solution. They want something especially customized to their needs, someone who can understand what their issues are and work with them in-depth," says Rackham, who is also CEO of Huthwaite, Inc. , a leading sales consulting, training and research firm based in Virginia.

"In the days when products were very different, communicating the value of your product brought you success, and selling was about communicating product value," explains Rackham. "The new type of salesperson is a value creator -- not a value communicator. The value-creation sale is blossoming and prospering while the value-communication sale is dying on the vine."

Fortune 500 companies are illustrating this trend in astonishing numbers. Xerox Corp., for example, has cut its supplier base by a dramatic 35 percent and is continuing to do so by developing stronger ties with a core group of trusted companies, according to Rackham. In 1997, the copier company had 15,000 suppliers; today, they have less than 500. This trend signifies far fewer sales opportunities as companies put their business out to bid less and less often.

Ohio-based Hensley Segal Rentschler (HSR), an integrated marketing and public relations firm, is one of the approximately 500 remaining Xerox suppliers. During their first year of service, HSR earned the trust of Xerox and was rewarded with an expanded contract for 1999.

Steve Kissing, public relations director for HSR, says true partnering requires trust on a greater scale. He stresses it is incumbent on the supplier to gain the trust of their customers by sharing information and bringing value to the product or service. "Partnering relationships are built the old-fashioned way -- through hard work and gaining ownership of the customer's problem," insists Kissing.

A Win-Win Relationship

The partner-level sales relationship is a win-win situation and implies shared risks and rewards for both parties. Chip Bell, best-selling author of "Customers As Partners: Building Relationships That Last", says that while there are a lot of emotionally rewarding reasons to turn customers into partners, the bottom line is it makes great economic sense.

"Customers who feel like partners with your organization have more realistic expectations. While they enjoy an occasional dazzling, wowing experience, they know that perpetual delight is unrealistic," explains Bell. Further, in this type of quid pro quo relationship, customers are more forgiving when you make mistakes. Bell says this is important since experimentation is critical to progress.

"Loyal customers cost less to serve since they know you and how to use you. Loyal customers don't sue you when things go wrong. Loyal customers spend more over time," continues Bell, "and they champion you in the market."

However, no relationship can survive without trust and accountability. Your company must be viewed as a credible source and your sales force as knowledgeable consultants to mutually benefit from a partnering relationship. Dr. Steve Bistritz, vice president of training development for Target Marketing Systems, Inc., an Atlanta-based international sales and training consulting firm, recalls an old sales adage that basically says, "People buy from people they like." However, Bistritz says this is no longer completely accurate and suggests a more modern truth, "People buy from people they trust."

Bistritz suggests that credibility is made up of two components: trust and capability. "If a client finds a salesperson who has a level of capability and also demonstrates a level of trust, then they are perceived as a trusted adviser," he explains.

Theory in Action

When Eastman Kodak Corp. came to United Parcel Service (UPS) looking for specific logistics solutions, the companies formed a mission statement that read something like this: "As a team, we will work together to enhance the profitability of both organizations."

Rajiv Penkar, who spearheads UPS Professional Services, says if you start with this mindset, your company will enjoy a higher level of engagement than just dealing with a customer on a transactional basis or responding to a bid. UPS Professional Services searches for efficiencies in areas like distribution and network analysis to improve its customers' bottom lines. Once a customized solution has been designed, UPS supports the solution with information technology.

"In our part of the business, information about the location of a shipment is just as important, if not more important, than the physical movement of the shipment," explains Penkar. UPS has developed an infrastructure to inform the customer where their package is every step of the way and who signed for it when it got there.

"The value to the customer is integrating the information into their systems," Penkar explains. He says 30 percent to 40 percent of calls to a customer-service center regard order status, resulting in operators answering shipping questions instead of making new sales. "With our solution, when their customer calls in, they can instantaneously, without calling UPS, identify by order number what the status of the shipment is."

Rackham says good service is being responsive to the customer, and great service is about anticipating what the customer is going to need. Bistritz agrees: "I think what customers are looking for today are the types of suppliers who can come to them and offer total business solutions. And that may entail the supplier developing an alliance with another business partner to jointly provide a total solution to their client." Bistritz adds that today's customer expects a relationship where one organization is accountable for the total business solution.

Enter GoldMine. The California-based software developer has doubled its earnings in each of its first eight years in the market. Dan May, GoldMine corporate accounts manager, says the company is uniquely structured to work through business partners - and it has 2,500 across the United States.

"We anticipate that when customers purchase GoldMine, they may have a problem or a question, and we want to walk them through these things as quickly and as easily as possible," explains May. GoldMine's virtual team of sales and technical service groups act as expert solutions providers in local markets. "For example, there is a business partner in Kansas City to support and service our Sprint account, as well as many other businesses in that market," explains May.

Are You Really Listening? Prove It!

Anticipating customers' individual needs and exceeding their ever-increasing expectations greatly depends on how well you understand each customer and his or her business. Turning customers into partners requires designing customized solutions that cannot be achieved without a deeper comprehension of the customer's perception of value drivers.

"When you can provide solutions that address both the business agenda and the personal agenda of the [customer], then you have provided a significant level of value," says Bistritz. "But the salesperson must listen before proposing a solution." He says you need to ask the client discovery-type questions first to demonstrate that you've done some homework on the business.

There are countless ways to solicit feedback from your customers, from 800 numbers to e-mail suggestion boxes. Perhaps a more important challenge, however, lies in getting your customers to respond with more honest information by offering value in return. Listening to your customers is critical, but reacting to customer feedback is equally important in a partnering relationship. Bistritz says today's customers are inclined to share more information with fewer partners if they know the data is being used to their benefit.

"The customer relationship is fragile. The idea of partnering is having the customer feel they are part of your business -- that their input means something -- and they can actually see the end results of their feedback being applied to the way your company deals with them," says May. He says GoldMine customers determine what new features will be in the software through the company's various customer care and feedback programs.

Bell says this idea of customer inclusion is one of the hottest new strategies for turning customers into partners, and savvy organizations are building paths to make customer participation easier. "When customers get to help design and refine service delivery, when customers get to play an active role in shaping the future of the organization, when customers opinions are sought and valued," says Bell, "their commitment increases."

Maintaining the Marriage

Turning customers into partners requires dedication and hard work. And it doesn't let up. You must continually demonstrate value and trust in order to effectively maintain and grow this type of sales relationship.

One key to maintaining a partnering alliance with a customer is never taking the relationship for granted. Dennis Crane is the senior vice president of corporate marketing and strategy for SCT Corp., a $400 million software solutions provider headquartered in Pennsylvania. Crane points out that true partnering goes beyond the sales force and describes the relationship as an alignment of business processes that creates a differentiation from a vendor just filling an order.

Your success really depends on how effective you are in mastering your relationship processes, and the most important one is your customers," suggests Crane. "If you start with a focus on customer relationships and do everything in your enterprise to support the relationship, you end up with better results."

Rackham says all successful partnerships tend to be driven by three factors: vision, impact and intimacy. The two parties must have a common vision and a clear set of goals, like UPS and Kodak, as well as a good system for measuring progress toward them.

Impact, or the capacity to create new value, is vital to the long-term life of a partnering relationship. Intimacy involves sharing information for the mutual benefit of the parties involved. Rackham says in the end, if one plus one doesn't equal three, all of the effort of partnership is not going to pay off.

"In order for us to present Xerox with good ideas, they need to share with us in turn," says Kissing. "The smarter they can make us, the smarter we can make them."

The Future of Selling Is Here

Although UPS is primarily a shipping company, it has gained and developed global intellectual capital and expertise that allows the company to offer valuable solutions outside its principal arena, including warehouse layout, fleet and facility project management.

Why did a leading delivery service venture into these challenging areas of the corporate world? Penkar says from a supplier's perspective, UPS feels it is very important to provide value-added services to their products in order to differentiate themselves from the competition and avoid commoditization.

"You need to go in and do things that will solve the customer's problem, not necessarily things that will give you additional business because the long-term impact of that is establishing a relationship with the customer, and you will no longer be treated as a commodity," explains Penkar.

Experts agree that true partnering is the future of selling. Rackham insists companies must either have the capacity to partner with their customers or risk starving to death.

"If you are not close to your customer, if you are not partnering with your customer in-depth, if you are not really investing a lot of energy in understanding them and moving along with their business," stresses Rackham, "there will be no more opportunities."