Have you ever wondered why entertaining clients is one of the oldest business practices around? According to Forbes, “customers now seek to connect with other like-minded individuals to get the most value in the long run.” Despite this, I have spoken with companies who see client entertainment as an unnecessary expense which distracts them from cut-and-dried work necessary to win new business and keep current customers happy.
So which one is it? Is client entertainment really superfluous, or does it serve a higher purpose?
As a young salesperson, I found the idea of entertaining clients a daunting one.
• Should I pay the bill in front of them, or privately speak with the waiter to settle up?
• What should I wear—business casual, or jeans? Surely not a full suit, right?
• How do I raise the subject of my company and its products. Is that even OK to do, or should I not talk business?
• Is it OK for me to have a drink?
I was lost. I was uncomfortable throughout the evening, and it probably showed. I later learned that a casual evening out is not the right place to tell a client everything you know about your product. It’s a setting in which you build trust and establish a rapport with your client. A place where you begin to take your first steps to what you hope will become a long-lasting relationship.
And those relationships need to be measured on a regular basis to ensure they are still productive for your company. I remember observing a company that hosted an annual golf tournament for its clients. It was a large production which included prospects and existing clients. The company didn’t realize they had a growing number of prospects who would attend year after year without growing any closer to becoming customers. They would play, dine, and take home some premium giveaways while delivering zero value to the company.
If a company can afford to entertain a client, it must have a system in place to ensure these investments are successful in terms of driving new business, keeping renewals high, and identifying upgrade opportunities. As these measurements are collected each year, it becomes easy for the company to identify what works and what doesn’t work when entertaining clients.
With an unprecedented number of distractions competing for our attention, face-to-face experiences are more important than ever before. But it’s not a quick-fix, it’s the first step on the road to building a lasting relationship that will benefit both sides. Remember that the next time you’re out with your client, and create an experience they will remember and associate with your company.
Spencer is part of the InviteManager Sales team. When he’s not talking with customers about client entertainment, you can usually find him practicing his golf swing.