What Customers Don’t Tell you about Buyer-Seller Relationships

This is an excerpt from the book ‘Games Customers Play’ by Ramesh Dorairaj. The book explains how business has been an endless series of games played by buyers and sellers with one difference. Both sides could win at the same time. Here he shows you how to spot such games and change the rules to your advantage. So that it doesn’t matter what the deal is, you will always win!

You must have heard the story of the beauty and the beast: Compulsion forces a young girl to marry a monster. In time, she grows to love him, and because of her genuine love, he turns into a handsome prince.

A variation of this fable seems to be the mental model in force when it comes to customer relationships—‘the customer is king!’, ‘We need to get closer to the customer!’, ‘the customer is always right!’—these messages have been drilled into us since the start of our careers. Company boards formed customer councils in an effort to listen and change. their executive leaders also created escalation channels by which customers were given attention from the very top in case of a perceived deficiency in service. With the advent of ‘digital’, service providers now have the choice of personalizing their offerings to a single customer. Most companies have embarked on such digital initiatives as they see the competition doing the same thing. they are spending a significant portion of their budgets on such initiatives.

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What Customers Don’t Tell you about Buyer-Seller Relationships

But should you do the same just because your competition is doing it? Will your efforts at getting closer to the customer give you more market share? Will such customers always stick with you? And will they stay more pro table for you in the long run? What if some of them are not your ideal customers? like the beast, will a customer become your handsome prince because of your e orts to serve him better?

Customers use this and other such stories and myths to create games suited to their advantage. Catchphrases like ‘the customer is always right’, ‘the customer knows best’, ‘the customer is waiting for you to solve a problem’ and ‘the customer is king’ have enabled customers to frame the rules of the game to gain an advantage, fair or unfair.

Customers have learnt to use these myths to design practices and templates for how to interact with sellers and suppliers. examples include elaborate procurement processes, reverse auctions, price benchmarking during a contract’s duration, renegotiating contracts much before expiry, feigning dissatisfaction to wangle discounts, and withholding payments for flimsy reasons.

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Most of these myths, and the practices they have spawned, are applicable only in certain circumstances. However, employees from supplier rms—who learn their chops at B-schools and from their bosses—have these ideas drilled into their heads. And they play along to the seller’s, that is, their own, disadvantage. Hence, to the customer’s advantage. such practices erode the perceived value of goods and make even sellers of sophisticated products and services look like mom-and-pop stores. sellers who don’t learn to change the rules or play a different game are at a disadvantage—and in the long run get defeated by the competition. As a seller, you can play the game that has been designed in favour of the customer, or change the rules. this book is about how to play a better game, the game that you are most suited to play, and how to change the rules so you can play it well.

Subroto Bagchi, former chairman of Mindtree, used to say, ‘Your business depends on how well you choose your customers.’ As I sold and delivered It services to many companies, both large and small, across many cultures, I can safely say that nothing else can come closer to the truth about buyer-seller relationships.

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If you want to know more about games played by buyers and sellers in business, you should read ‘Games Customers Play’ by Ramesh Dorairaj.

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