In 2002, marketers began utilizing the executive-level Customer Advisory Board (CAB) as a means of gaining a deeper, more strategic understanding of their customers and the markets they serve. By engaging with the executive leaders of their key accounts, host companies are able to facilitate deep dialogue that shines a light on where their customers are heading with their businesses, and align their marketing strategies to be on point with their future requirements.
An executive-level Customer Advisory Board should not be viewed as a one-off event but rather a long-term, cross-functional initiative spearheaded by the CEO. A CAB is intended to provide a level of focus on the customers that goes deeper with regard to the conversation and higher with regard to the level of customers with whom the host company is engaging.
Investing in customer relationships undoubtedly yields big results when it comes to future growth. By inviting a small group of key customers to have a seat at your table, you are in effect asking the people who pay for your products and services to become members of your team.
With access to the leadership team of their key suppliers, CAB members naturally become invested in the success of the business, and oftentimes become advocates of the brand because they have an understanding of and confidence in the roadmap ahead.
Some of the key benefits of a Customer Advisory Board include the ability to:
- Gain a keen understanding of market conditions and how that impacts buying decisions
- Enhance rapport with key customers
- Drive loyalty – the best customers now have a seat at the table
- Risk mitigation – validation that strategies are on point
- Test new ideas and campaigns
- Share learning of topics of mutual interest
- Identify untapped sources of revenue
- Create strong advocates for the brand and the organization
- Discuss customers’ strategic priorities
- Achieve internal team alignment around specific strategies
- Innovate in collaboration with those for whom products and services are provided
There is an undeniable benefit to the executive team and the organization as a whole when marketers can provide this high-level, high-value insight directly from key decision makers. Research points to the following:
- B2B host companies enjoy a 9 percent increase in new business among their CAB membership after one year
- 95 percent retention rate among participants
- CAB member participation in reference programs, testimonials and thought-leadership efforts is 57 percent higher than among non-members
- The top benefit host companies derive from CABs, according to a recent survey of CAB practitioners
- Product and solution direction (77 percent)
- Strategic company direction (63 percent)
- Market insight and intelligence (50 percent)
- Branding and positioning feedback (50 percent)*
*Nov. 2015, Rob Jenson, VP of Ignite Advisory Group
In my next post, I will share some best practices for recruiting the right members to your Customer Advisory Board.
Betsy Westhafer is the owner of The Congruity Group, an organization that helps mid-market and large companies gain strategic insights through the use of Customer Advisory Boards. Betsy has worked with teams to design and facilitate customer advisory boards for companies including Dell, LexisNexis, VeriSign, Springer and Adobe. In this capacity, Betsy delivered advisory boards around the world including in the UAE, Turkey, Spain, Portugal, Jordan, Mexico and throughout the United States. Betsy can be reached at email@example.com or at 513-550-1701.