Customer Advisory Councils

by Todd Youngblood

A well-run Customer Advisory Council can easily become a distributor’s most effective sales and marketing tool.

Imagine a hotel conference room where the key decision-makers from each of your ten most important accounts are comfortably seated.  Let’s also include two top representatives from your firm – say the President and the VP of Sales.  Think of a packed five-hour agenda where each executive present shares his or her ideas, expertise and experience.  Everyone is intense.  Everyone is focused on improving business processes.  Everyone is formulating strategies to conduct business more efficiently and effectively.  YOU are the driving force that made this potent meeting happen.

For several leading distributors who have implemented a Customer Advisory Council, this scenario repeats itself twice a year.  The magnitude of the impact on the breadth and depth of customer relationships is more than remarkable.  These firms have firmly positioned themselves “above the crowd”.  They have achieved – and continue to reinforce – an enviable level of competitive differentiation.

Not that it’s easy…  The planning and preparation for a “CAC” meeting requires substantial effort and commitment.  As one who has facilitated many of these sessions, I have become accustomed to the shock that accompanies hurdle number one; that is, getting customer decision-makers to participate.  If you happen to be a VP of Sales, it can be humbling and, frankly, embarrassing to realize that your firm does not have enough good contacts to fill the seats.  (Don’t say, “Not a problem for me!”, until you’ve tried…)

Sadly – and paradoxically – lack of strong customer relationships is often sited as a reason for not implementing a Customer Advisory Council process.  Unless yours is a very small firm, that is a “head in the sand” outlook. 

The next biggest opportunity/challenge is follow-up.  While it is prudent not to promise action on all suggestions, it is essential that at least a few visible, substantive measures be taken after each meeting.  Given the depth of the discussions, many of these tend to be difficult, and at times, expensive.  Given their source, they also tend to lead to significant and sustainable competitive advantage.

Always remember to get commitment for customer involvement with any CAC related projects.  My experience is that customers are more than happy to work with you on these initiatives.  After all, it was their idea, and they are the key beneficiaries. 

Agendas, at first, should include questions about your customers’ perception of your strengths and weaknesses – things you do well and not so well – things you don’t do that you should and things you are doing that you shouldn’t.  Subsequent meetings can be based on discussions and priorities identified in prior sessions.  I also recommend having a guest speaker.  An outside perspective on a topic of general interest tends to enhance creativity and “outside-the-box” thinking.

Then, there are the logistics.  Nothing really that difficult here; it’s just important to be well organized in front of your best customers.

It also makes sense to use a “neutral third party outsider” to facilitate the meetings.  As the host, you want to be visible, but in the background.  While it is in fact an all-day sales call, it must be an extremely soft sell with a long-term perspective.  If you push-pitch-present too much, you defeat the whole purpose.  Let the outsider ask the tough questions, challenge customer statements and lead the discussion.  You concentrate on listening.  Learn!  Think!  Plan!

No businessperson ever debates the necessity of staying close to customers.  That is the only way to fully understand their current needs and to anticipate future requirements.  Worst case, a well-run Customer Advisory Council will help grow revenue, protect against competitive threats and reinforce your reputation as a leader.  Best case, it really can be a distributor’s most effective sales and marketing tool.