Sales and Marketing executives who must “place bets” on where to allocate resources sometimes ask, “Are we spending too much on customer/hospitality-related activities? What’s the impact on earning loyalty?”
Entertainment’s impact is hard to measure. It likely doesn’t win business on its own, or act as a key driver of customer loyalty, However, hospitality can have a role in starting and building relationships. Most customers care most about how products/solutions help their businesses, but buyers need to know who they are working with, too.
In B2B sales, various relationships must be built and maintained within buyer accounts, including between executives on both sides. This often best occurs in informal settings – over a drink after work, dinner, hospitality suite during conference, etc. — as well as in office meetings and of course phone or video encounters.
With travel, entertainment and sponsorship budgets under siege in recent years, here’s evidence from Corporate Executive Board research about the danger of cutting back too much on hospitality measured in travel costs . Another take from CEB on the continued impact of having face to face contact. Of course those are office meetings as well as off-site.
In summary, managing the budget so that account reps deliver solutions desired by strategic accounts is always the single most important issue. Hospitality plays a key role in building some of the relationships necessary to make that happen.
