The 4 Categories of Client Relationships

Ever wonder what you get in my Sunday newsletter? Here is an example.

I’ve been looking at all kinds of different client relationships. I’ve dropped them into four categories as a way to make it easy to explore what you need to do to improve those relationships—for you and for your clients. As we walk through them here, take a few notes on where your clients fall.

Category 1: Not good for you, Not good for your client. These relationships are not good for you or your client. If there is no way to create a healthy, value-creating relationship with a prospective client, then any category 1 deal is only going to cost both of you time and energy.

But that’s not where most of these relationships come from. Most of the relationships start out at some higher level and decline to reach this category over time, normally when both parties have become complacent.

What are you doing to prevent your relationships from slipping to this level?

Category 2: Not good for you, Good for your client. This is where most weak salespeople and weak sales organizations live. They take deals where they can’t command the price they need to deliver, and so always deal with customers who are getting the better end of the deal. These are not relationships of peers, these are subservient relationships. These relationships make you resentful, and in the end, you probably underserve your client and make them resentful.

How do you move these relationships to a better level?

Category 3: Good for you, Not good for your client. These are not deals where you do good work. These are deals where you do well and your client or customers don’t do well. That is never good.

When you create value, you are entitled to capture some part of the value that you create. When you create massive value, you can capture massive value. These are relationships that are all value capture. Ultimately, these will destroy your relationships, your reputation, and your revenue.

What do you need to do now to create the value that entitles you to what you are capturing?

Category 4: Excellent for you, Excellent for your client. This is the sweet spot. These are the relationships you need to grow and sustain a business. This is where you build customers for life. You create massive value. You capture massive value. You bring growth initiatives to your clients. They challenge you to grow with them.

You have to create these relationships by calling on the clients for whom you can create massive value. You have to discover the people within those companies who are mature enough as business people to seek category 4 relationships. You have to develop the initiatives that deliver, and you have to accept the challenge to grow yourself.