17 Oct 2016 by Johan / No Comments
Great leadership is one of the most important building blocks of a strong client-supplier relationship and has a direct link to an organizations bottom line. Current clients are always the bread and butter of any organization and those relationships need to amplified and nurtured in order for the organization to exist. The Harvard Business Review illustrated the importance of customer retention by stating that a 5% increase in client retention will increase organizations profitability by 25 to 95%.
Important Leadership traits to create long-term customer retention
- The Business leader needs to have a strong connection with the brand to start with and aim for service excellence and consistency at all levels to create a trust relationship customers can rely on and keep coming back for. Leaders who are hard on themselves create the perception of perfection that clients admire.
- Management and leadership must understand the notion that happy staff members create a ripple effect and create happier, more loyal Customers / Distributors. Research conducted by Zenger Folkman noticed in their findings the impact management has on employee work performance and in turn the company’s ultimate profitability. They found that great leaders created strong employees who engage more with clients and communicate value in a tangible way, which lead to high client and distributor retention.
Writer, Bill Hogg, stated that a disconnect between employees and leadership will create a negative customer experience and stunt customer and distributor retention. Weak leadership discourages employees from their best work, it decreases cross-functional communication and negativity affects the service quality, which all damage new or existing client relationships.

A study first conducted in 2008 still rings true, stating that employee fatigue is a result of poor leadership support and can harm employee/customer relationships. When employees are energized they perform better and pay closer attention to the client, creating an experience rather than a transaction.
- Leadership must put their heart into their client relations; customers will do business where they sense sincerity and transparency. If clients are able to see your company’s values and belief by the way you act and treat them you will cement a relationship. Talk is cheap. Leaders who are able to provide a constant stream of information and status updates to their clients build the peace of mind needed to form a long lasting relationship.
- Motivational and inspirational leadership leads to customer / Distributor retention, because employees are driven by positivity and therefore pour their heart and soul into their functions and pass on that good energy to everyone they interact with.
Studies show that an unhappy customer will tell 7 to 10 of their friends if they dealt with someone who was impolite or rude to them. Adding social media to the mix, most people have about 400 Facebook friends who will all read a post about poor service. Research also shows that negative experiences create a clearer memory and last longer in the customer’s mind and this negative belief, driving negative behaviours.
- Leadership impacts client retention by setting a clear path for their employees. By providing your employee with a broader sense of your organization and the community you serve, it will change their perspective on how they should engage with clients. Loyalty is created when employees are fully aware of their clients / Distributors wants and needs, and set expectations and capabilities early on in the conversation.

- Great leaders create client retention by creating collaborative groups, where customer service involves a number of people who are all as helpful and as friendly as the next. This projects a desired image of your company and shows the client that their one positive experience wasn’t an isolated incident, but the way in which your company operates on an ongoing basis. Another factor to consider and why customer service should be a group effort, is that 30% of consumers are concerned when their account is taken over by another unfamiliar individual and causes strain on the relationship.
- Great leaders create memorable experiences and create excitement around their brands, which encourages clients to become “unpaid brand ambassadors”. This includes being able to sort out problems quickly and with ease and surpassing a client’s expectations, by using good judgement.

As research has stated, leadership in an organization sets the tone and the pace for the organization. The way leaders treat and manage their employees have a direct influence on how employees engage with their clients and how the customer views the organizations value proposition.
Best Regards,
The Butlers Point of Sale Logistics Research & Development Team

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