I recently interviewed a man who had been the VP of Sales for a national manufacturer. The company he represented sold through a network of businesses and he was well-versed in developing strategic partnerships with distributors. He saw his buyers falling into three distinct categories.

Three types of customers

  1. Transactional – This type of customer is only concerned with price. Beware of the buyer focused solely on this — he will quickly switch to the supplier that offers a better deal.
  2. Engaged — Gaining the trust of a client builds brand loyalty. A customer who is engaged is one with whom you have developed a two-way relationship. You respond to their needs in a timely and honest manner. Be vigilant about guarding that hard won position from other brands trying to tempt your client to switch suppliers with a better value proposition.
  3. Embedded – An embedded relationship is one typified by mutual respect, long-term commitment, and a strategic partnership. This is a step above the engaged customer and the most ideal position from a sales perspective. Embedded customers are loyal.

Are you Developing Strategic Partnerships

The manufacturer’s long-term distributor relationships were all developed as strategic partnerships in which both parties shared business plans and problems. As VP of an independent distributor for 35 years, I agree. I met with my vendor managers regularly to create game plans that helped us sell their products. It is important to have close contact with your clients. If one of your vendors loses its footing and its brand loyalty deteriorates, it opens a door for your competition to walk in.

Your Value Proposition

It is important to consider these three customer relationships and how they play with your customer base. Are your current customer liaisons transitional, engaged, or embedded? Can they withstand disruption?  Work on your value proposition to ensure you develop strategic and lasting partnerships.

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