All_activities_2-orange-1Strategy and marketing expert Christine Crandell recently explored the causes of B2B customer churn in a blog. She pointed out that while many enterprises dissolve vendor relationships on the basis of low value products or a change in customer focus, these are often excuses enterprises use to avoid an unpleasant confrontation with the vendor’s management team. Rather, Crandell’s experience in end-customer interviews revealed that the following causes were among the top reasons for B2B customer churn. Learn how vendors can address these causes of churn using a software solution:

1. Outcomes

Crandell identifies a critical misunderstanding that many vendors fall victim to. That is, vendors believe that enterprises seek out vendors to solve a problem. She says this is not true, that enterprises seek out vendors to “produce an outcome.” For example, a food and drink store may take on a vendor of coconut water, not to solve the problem of filling the shelves, but to produce an outcome of offering a variety of health drinks to customers. An atmosphere of expectation results from the vendor’s solid understanding of the role in the relationship. This misunderstanding can cause vendors to under-perform in business relationships.

Vendors need to be constantly aware of expectations, and be flexible when they change. This can be done by systematic data collection on the part of the vendor’s field reps. Vendors should consider leveraging a software solution that will allow reps to document and share client information via mobile devices in the field. By utilizing customizable forms, vendors can have reps ask a set of questions and share the results in real time through the Cloud. This is critically valuable data that will keep vendors more informed and enterprises satisfied.

2. Trust

Another issue enterprises encounter with vendors is a lack of trust and dependability. One main factor that deteriorates the trust of vendors is merchandising. The responsibility of properly merchandising product is often shared between an enterprise and its vendors. That means a level of trust needs to be established by each side’s reps. Too often, mistakes related to product facing, shelf position, or in-store position are made, and tension arises between reps on either side to determine fault. This leads to unprofessionalism and distrust between the enterprise and the vendor.

To avoid these uncomfortable situations and reduce the chance of churn, it is vital that vendors are equipped with tools for accountability. For example, a number of Field Activity Management software tools enable reps to show visual evidence of work through geo-tagged photos. Using a phone or tablet, reps can snap before and after pictures proving where and when a merchandising activity took place. This visibility will assure the enterprise that the vendor’s reps are accountable for their assigned part of merchandising and build a foundation of trust.

3. Relevance

One key factor in healthy, lasting enterprise-vendor relationships that many vendors overlook is relevance, according to Crandell. What she means by “relevance” is that enterprises are constantly trying to gain a competitive edge by understanding their competition and catering to customer needs in innovative ways. Vendors who can aid this process are much less likely to be victims of B2B customer churn, because enterprises see them as a strategic benefit. The first two factors listed here involved avoiding negative experiences, while this factor is a matter of proactively providing value.

Vendors can offer their enterprises relevance through knowledgeable reps, intelligent advice, and data sharing. Vendors trying to stand out from the crowd should leverage a Field Activity Management software solution to conduct in-store customer surveys to understand the consumer climate. In addition. by using the geo-tagged photo feature mentioned before, reps can document competitor strategies on merchandising. This superior knowledge and expertise on the market will make the vendor an attractive partner for any enterprise.

Lasting Relationships

As Crandell notes, the dissolving of a relationship often shocks the vendor, and they are frequently only offered a flimsy and inaccurate excuse as an explanation. The real reasons may include a lack of outcomes, trust, and/or relevance. By implementing a Field Activity Management software solution, vendors will be able to focus their reps on providing outcomes, building trust, and using intelligence to become a desirable business partner, significantly lowering the chance of  becoming a part of customer churn in the B2B industry.