How to measure the strength of your customer relationships
With 12 examples and 8 ways they impact whether you win or lose your proposals
When your bids win or lose based on how well your proposals help the customer reach their decision, the best competitive advantage is often an information advantage. Everyone has the same RFP. Knowing how the customer makes their decisions, what matters to them, and what they need to see in the proposal can give you an edge in how you respond.
Gaining an information advantage is why relationship marketing is so important. The relationship is the goal. Your goal is the result of the relationship. And that goal is an information advantage that you can use to win the proposal. You can measure the strength of your customer relationship based on how well it helps you develop an information advantage.
The extent of your information advantage can be measured by your ability to answer the questions that proposal writers have when trying to write a winning proposal. An ordinary proposal is self-descriptive and can be completed without a lot of insight simply by responding to the RFP. Unfortunately, an ordinary proposal is not going to be competitive. To be competitive, you want to prepare a great proposal. A great proposal requires insight to provide what the customer needs to see to reach a decision in your favor. Creating an insightful proposal requires an information advantage. All the great ideas you have on your own are no match for insight into what matters to the customer.
The strength of your information advantage can be measured by its ability to answer your questions. Now, you just need to know what questions you need answers to in order to write a great proposal.
On your next bid, try providing insightful answers to questions like these:
- What will it take to win this pursuit?
- What are the customer’s preferences?
- What are their goals?
- What is their management style?
- What matters to the customer?
- What is the price required to win?
- What should you offer?
- Do you have any gaps in your offering?
- How would the customer prefer you to handle the inevitable tradeoffs?
- What will make you a better alternative than your competitors?
- How does the customer make decisions?
- What information do proposal writers need to close the sale?
The answers to these questions determine:
- Whether you should bid
- What you should offer
- How you should position, differentiate, and present your offering
- What your win strategies should be
- What points you should make when writing the proposal
- How to get the best evaluation score
- How you should price your offering
- How to make bid and tradeoff decisions
The secret to consistently winning competitive bids is to go into each bid knowing the answers to these questions. Discovering the answers requires a customer who is willing to discuss them with you. This means that you need a relationship in which the customer feels comfortable talking to you. And this in turn means developing that relationship before the customer’s acquisition process reaches the point where they limit communications. This impacts which customers you should target, which you should avoid, and which bids you should invest in pursuing.
You will never get all the answers you want and you should always consider far more questions than you will ever be able to answer. You won't get any answers if you won't know which questions to ask.
If you can learn more than your competitors and turn that into writing a better proposal, you have turned an information advantage into a competitive advantage. Bidding without an information advantage means you are either gambling on your ability to guess better than your competitors, or you are betting that all you need is to offer the lowest price. Overconfidence in either of these will result in a low win rate as well as low profit margins.
This is why we made pre-RFP Readiness Reviews part of the MustWin Process that is available to PropLIBRARY Subscribers. It provide a structure for developing an information advantage and a starting point for the questions you should ask. It includes our method for quantifying the answers to questions that you can use to quantify the strength of your customer relationships, correlate answers with your win rate, and identify trends in the effectiveness of your business development efforts.
Not only can you measure the strength of your customer relationships by how well they produce an information advantage, you can measure the profitability of relationship marketing by how well it improves your win rate. An improvement to your win rate means increasing your revenue without having to chase more leads.
When your company is new, it's hard to commit a large level of effort to relationship marketing. But when you do the math, you’ll find that it’s worth the effort to build customer relationships that provide the information advantage you need to win. Losing proposals are expensive. Winning pays for the cost of pursuit and then some. Companies that consistently win and generate positive returns know what "ROI" stands for…
Carl Dickson
Carl is the Founder and President of CapturePlanning.com and PropLIBRARY
Carl is an expert at winning in writing, with more than 30 year's experience. He's written multiple books and published over a thousand articles that have helped millions of people develop business and write better proposals. Carl is also a frequent speaker, trainer, and consultant and can be reached at carl.dickson@captureplanning.com. To find out more about him, you can also connect with Carl on LinkedIn.
