“Businesses that depend on long-term customer relationships need to avoid win-lose situations, since backing out of a bad deal can cost a lot of future deals as well. Businesses need to find a creative way – such as assertive pacifism and inventive solutions – to persuade tough customers and to frame productive business deals,” – HBR.org
Competition and conflict have been constant companions to human affairs throughout human history. In response, discussions, negotiations, and persuasion have emerged as the top tactical tools that have dominated conflict resolution paradigms throughout human history. Tactics centred round these actions have assumed more importance in modern times when we survey the fact that brands, businesses, and commercial organizations operate in competitive modern markets. Brands and businesses can persuade the toughest customer to accede to key business propositions while granting certain minor concessions to the said entity. When diligently pursued, this line of action enables modern businesses to present and reinforce a distinct value proposition to all customers, while retaining and maintaining the integrity of profit margins.
Conversations with the toughest customer can provide invaluable instruction to modern business enterprises. The management personnel and sales cadre of a business organization should actively pursue these conversations and negotiations with a view to deciphering customer requirements and motivations. For instance, an e-commerce business operator may choose to negotiate long-term logistics deals with a courier services operator. The latter may emerge as the toughest customer of the e-commerce business, intent on driving profitable deals at the expense of the margins of the online business operator. Tackling the exacting demands of the courier operator may require the online business to be prudent and assertive at the same time. In certain cases, it has been observed that negotiations can continue for months, but creating a sharp focus on business outcomes can help both parties to achieve a speedy resolution. Therefore, the online business operator can choose to avail certain commercial devices such as bulk-shipping discounts in a bid to conclude the negotiations profitably for both parties.
Empathy is a key human emotion that can play an important role in commercial negotiations. We note that the toughest customer can adopt tactics that protract negotiations in the interests of securing a favourable deal. The incumbent business must pay close attention to these tactics and respond with a degree of empathy for said customer’s point of view. For instance, a corporate establishment can seek external vendors to fulfil its training and development requirements. The negotiations may meander over weeks and a situation may arise that sees a vendor deploying hard line tactics to win the contract. The said corporate establishment can examine the vendor’s motivations, assess its true intentions, and respond with a solution that dovetails with the vendor’s key concerns. Additional inputs may include widening the scope of the contract subject to certain conditions. The outcome may satisfy both the negotiating parties and close the deal on a favourable note for both businesses.
Building a long-term rapport with clients and customers can help businesses deal with the toughest customer. This approach can yield significant dividends because it seeks to build common ground between a business and its customers. Rapport is essential because it represents the crux of confidence building measures. For instance, a major commercial wireless services operator can build rapport with its peers and customers in a spirit of competitive performance. We must note that these operators typically compete on narrow margins but the establishment of a commercial rapport can enable all incumbents to thrive in commercial markets. These actions can enable said incumbents to stave off debilitating price wars and prevent the poaching of active customers. In addition, a rapport can help to establish healthy business relations between a telecom operator and its many customers. In light of the above, we must note that rapport can persuade even the toughest customer to negotiate on reasonable terms and the climb down from hard line negotiating positions.
A client may be angry and frustrated with the services offered by a business enterprise. These circumstances typically lead to situations wherein said client assumes the proportions of the toughest customer. Consequently, the said business enterprise may choose to ameliorate the situation through negotiations and active parlays conducted behind the scenes. For instance, a lighting services business may face irate customers that are frustrated with repeated lapses in service delivery standards. The said business can face brutal negotiations with these toughest customer(s) in a situation that may lead to customer flight to competing enterprises. As part of business negotiations, the lighting contractor may offer free replacement of lighting devices for a limited time frame in addition to discounted rates of future services that may be rendered in the following six to eight months. We note that the conciliatory approach may help to arrest the prospect of customer flight, while assuring customers that service lapses would be reduced to a minimum. We note that this tactic enables the business operator to retain critical clients while expanding he remit of its services. In addition, a successful close to negotiations may boost customer goodwill, thereby paving the way to future business expansions.
Highlighting certain product and service benefits can enable a business to deal effectively with the toughest customer. We may state that this is a marketing stratagem designed to spotlight business benefits in a bid to win customer mind share. For instance, a software developer and marketer can choose to refresh the memory of its toughest customer by highlighting certain unique value propositions offered by its flagship software packages. This technique hinges on reminding clients and customers that a continuing business relationship offers best-in-class benefits and therefore, business negotiations can accrue emphatic benefits to the paying customer. In addition, the software business can assure the toughest customer that he or she would rank among the privileged few that can sample future business products in advance of the general market. This sweetener should act as a definitive proposition that can ease the pace and scope of any negotiations into a favourable conclusion.
An intelligent business narrative can help a business enterprise to negotiate with the toughest customer. This narrative takes into account the existing state of operations in a certain industry, the pressures to achieve a business profit, and spotlighting the lack of competing products and services. For instance, a jewellery manufacturer and marketer can negotiate with its suppliers with the intent to bolster its business margins. This must be achieved at the cost of cutting the supplier’s margins and therefore, said jeweller must work to persuade the suppliers to reduce their own margins. The jeweller may cite the current market conditions and the static state of market demand to drive its argument. However, the toughest customer among the suppliers may refuse to cede ground. Subsequently, the jeweller may cite the fact that its own distribution network remains the most extensive in the industry, and a refusal to its business proposition may exempt said customer from the distribution network. This combination of approached may enable the jeweller to attain its business objectives through clear-cut, formal negotiations.
In the preceding paragraphs, we have examined some of the strategies that enable businesses to deal with the toughest customer. We must note that every business should exercise these strategies in calibrated combinations to achieve the desired business outcomes. In addition, the use of such strategies helps businesses to retain existing customers and to create wider pools of business relationships. These outcomes are healthy for business bottom lines and point the way to future achievements of the modern enterprise.