Business Relationships: What We Can Learn From Charities
MoneyMoz.com presents you “Business Relationships: What We Can Learn From Charities”, an article written by Holly Zenith. We hope you’ll find a lot useful information in here.
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If you’re an entrepreneur, you’ve undoubtedly learned that your success depends on your relationships, be it with your customers, suppliers, and other business people in your industry. You may have had someone give you valuable advice, teach you a skill, or provide constructive criticism. It’s true that even if you’re a solo entrepreneur, you can’t do it alone.
More and more businesses are finding value in joint ventures, strategic alignments, and co-branding. How do these businesses find each other? The businesses didn’t. The humans in the businesses did, demonstrating that human relationships are critical.
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Often, people seeking out a mutually beneficial relationship with another business person fail to focus enough time on the relationship building aspect of the process. They focus great energy and attention on coming up with ideas to maximize the union and on reaching desired outcome, but little focus on nurturing relationships to maximum potential.
Think this is huggy feely stuff? Think again. This is hard-core, bottom-line money stuff.
Consider charities. Most charities receive a significant portion of their income from wealthy individuals. And the charities don’t even offer a product in return!
For example, Sam might contribute $40,000 to his favorite charity this year, and do so willingly. He also might purchase a new car for $40,000. In exchange for $40,000, the charity gave him a thank you and a tax receipt. In exchange for $40,000, the car dealer sold him a car.
In the first transaction, Sam walks away with something of little value. Sure, a tax deduction is nice, but the value certainly won’t net $40,000. In the second transaction, he walks away with a brand new car, something that has that “new car smell,” something that might even be a status symbol, and certainly something very useful in his life for years to come.
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You’d think that Sam would feel much friendlier towards the car dealer. Look how much more he received in return for his $40,000 from the car dealer than from the charity!
What if the car dealer approaches Sam next year and says “How about another car?” The chances are that Sam would say “No thank you.” But you can bet that next year the charity will ask Sam for another $40,000, maybe even more, and the chances are also good that Sam will write another check, and another one the year after that!
Charities devote a majority of their time thinking about their relationships with their donors.
Here is the key point of this article: Charities create strategic plans around relationships they want to cultivate and grow. If Sam was a first-time customer at the dealership, it’s likely that the relationship between Sam and the dealership didn’t start until Sam walked through their door. However, often, charities start working on relationships with people before the people even know about it!
With Sam, it may have looked like this:
Someone in or close to the charity brought Sam’s name up as someone who is wealthy and philanthropic. The staff of the charity researched Sam and learned that many of Sam’s passions relate to what the charity does. Remember, Sam is totally unaware of any of this.
Then the charity considered the best strategy for getting on Sam’s radar. They considered a letter, a phone call, and other options. They learn that Sam’s wife and the wife of one of their current donors are friends. They approach the wife of the current donor for help. She invites Sam’s wife to tea, and brings up the topic of the charity, just to feel her out. Sam’s wife responds positively.
Sam and his wife are invited to the charity’s annual dinner and auction. They attend. At the auction, the wife of the donor introduces the director of the charity to Sam and his wife. They chat, and the director asks if she could visit them some time to get their ideas on a new initiative. Sam and his wife accept.
The director visits Sam and his wife, and obtains their feedback on the initiative. A few months later, the plan is rolled out, with their feedback incorporated into the plan. The plan is brought to Sam and his wife again, this time with a request for financial support to help roll the plan out. Now that Sam and his wife have some “ownership” of the initiative, they are happy to write a check.
Over the next year, the director reports to Sam and his wife on the progress of the initiative.
The next year, it is easy to call upon Sam again to ask for additional support, or to support a different initiative. The relationship has been built, and the charity will continue to devote a lot of energy in growing this relationship.
This is the lesson entrepreneurs can learn from non-profits. For example, when considering a joint venture, who might the best person be to approach? Maybe the best person is the person at the top of his or her field and has no idea you even exist. Maybe you feel you need to stay within your own “league,” even though the endorsement of this person could boost your business immeasurably.
Instead of picking up the phone, barging into that person’s office, or sending an email out of the blue, take time to develop an approach plan. Research the person, perhaps determine if you have any mutual acquaintances, come up with a legitimate reason to contact this person, and then grow the relationship with care and consideration. Be genuine about wanting to create win-win situations, and accept that growing relationships takes time.
If you build your business with some of these principles, you might be amazed at the cadre of wise, experienced, and influential people who might make themselves available to you. And as for car dealers, the truth is that they DO proactively court customers like Sam. Who is your ideal customer? Consider how a charity might begin and foster a relationship with that person, and develop your own plan accordingly. If you have several relationship plans at various stages of development, you will soon see your base of highly qualified, eager customers grow.
Holly Zenith is a motivational author and netpreneur, who has also worked extensively with non-profits in helping them grow their donor bases. Visit her website at http://www.hollyzenith.com
Keywords assigned to this article by MoneyMoz: business,networking,selling,sales,customers,customer relations,sell,Holly Zenith,entreprenuer
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