Price doesn’t do it anymore. Sales volume doesn’t guarantee profitability. Marketing and sales have shifted from an emphasis on transactions, sales volume and competitive pricing to an emphasis on creating and retaining the right customers. Notice the word “right.” It means that not just any customer will do. Only the one whose needs fit with the selling company’s core offering is likely to establish a relationship with the selling company that generates profit. When companies chase customers who do not fit with their core offerings and abilities, they end up with liabilities instead of relationships.

In the information age, all parties involved in the purchasing process have more knowledge available to them than ever before. Whether we are talking about the average consumer buying a car or a business buying a computerized inventory control system, the buyer has access to a wealth of quality, specification, and pricing information for almost any product or service on the market. The informed buyer also knows what the competition has to offer. Meanwhile, market-savvy sellers know who their potential buyers are. They gather information that tells them about the needs, problems, and requirements of these potential customers. That allows them to identify the ones best suited to become valued, repeat, and increased volume customers.

For an example of a business that has made the transition from a transaction-oriented strategy to a customer-oriented strategy, look at car dealers. Because their buyers are increasingly well-informed, car dealers cannot count as much on making unreasonable profits from unsuspecting customers. Nor, in this age of hype and advertising, can they rely on repeat business from customers who are loyal to their make of car. So, they need to develop strategies that create repeat customers out of their current buyers. Once considered revolutionary and unprofitable, “no-sticker-dickering” marketing has become a common practice among dealers who are trying to cultivate customers.

Salespeople must be able to determine whether a fit exists between the prospect’s needs – budgetary and otherwise – and their product or service offering. It’s important to disqualify prospects whose needs and values would not fit with your company’s offerings. The effort to force a fit is misguided. This is particularly true in today’s market in which your goal is to profit from long-term relationships. The demands of a single “bad-fit” customer can be costly to your company, even in a short-term relationship. It is better to sell to a “good-fit” customer whose demands your company can meet without straining its resources and competence and who will likely buy again. Sales managers must help salespeople distinguish between bad-fit and good-fit customers, encourage them to get a clear “no” from the bad-fit customer, and help them develop the skills to bring home the good fit.

The same distinction should be made with your existing customer base when exploring ways to grow the business with them. In this case, the question of “fit” is twofold. First, is this a good-fit customer with whom you want to build a long-term relationship? Second, what other product or service offerings also provide a good fit with this customer?

By encouraging salespeople to seek out and cultivate good-fit customers, you enhance sales force effectiveness and increase the likelihood of long-term relationships and profits.

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