The Value of Relationship Capital in B2B GTM Strategies

The concept of relationship capital and its importance isn’t particularly new to most B2B companies. For years, analysts and reports have told us that building relationships with customers, earning their loyalty, and retaining their business is crucial to success. You’re probably already familiar with the notion that 80% of a company’s revenue comes from 20% of its customers.

Relationship capital doesn’t just refer to the value of the connections you build with your buyers either. It also applies to the impact of your relationships with employees, partners in your GTM strategy, and anyone else who contributes to your business success.

Unfortunately, many B2B business still don’t invest enough time and effort into building their relationship capital. They undervalue customer success teams, struggle to maintain employee engagement and take fragmented approaches to partnership development. 

In 2024, this process needs to change, for B2B vendors to thrive in a competitive landscape. 

What is Relationship Capital?

Relationship capital can be a complex concept to understand, as it’s harder to measure than “financial capital”. Essentially, relationship capital is the value created for your business through the creation, development, and maintenance of relationships with other people. 

This includes the value of the relationships you build with your customers and target accounts, to earn their trust, loyalty, and higher customer lifetime values. It also applies to the extended network of associations and contacts within your company, such as partners, suppliers, and employees. 

While the success of a company’s GTM strategy, and long-term ability to scale and thrive relies on many different things, few are more important than the strength of your relationships. The best companies excel because they use relationships to their advantage. 

The Benefits of Relationship Capital

Relationship capital is quickly emerging as the crucial asset underpinning the most successful B2B go-to-market strategies. Think of it this way, take your number of current employees, and multiply them by their average number of LinkedIn connections. That means 1000 employees with 200 connections each would have 200,000 relationships to tap into.

That’s 200,000 opportunities to reach a relevant decision-maker in a team, find a champion for your brand, or access a sale. Beyond simply helping you expand your reach, relationship capital builds:

• Loyalty and trust: Trust and loyalty are the cornerstones of B2B success. Budget-conscious companies will quickly abandon your organisation if they see a better opportunity elsewhere. However, they’re less likely to churn if they have an existing relationship with your company.
• Long-term value: Relationship capital drives better results for your business over time. The stronger your relationships grow, the more advocates you get for your brand, the lower your customer acquisition costs drop, and the higher your lifetime revenue rates grow.
• Competitive advantage: Relationship capital can give you a key point of differentiation in a crowded market. It can also help you to access the data, insights, and unique perspectives you need to innovate in your industry, and further separate yourself from the competition.

How to Develop Relationship Capital in 2024

Here’s where things get tricky. While a lot of companies are aware of the idea of relationship capital, they don’t know how to actively increase it. Many companies make the mistake of thinking that they can boost relationship capital with “personalisation at scale”. 

With AI and automation tools, anyone can potentially create more seemingly “personalised” marketing, sales, and customer success strategies that could improve engagement.

However, true relationship capital can’t be built with AI and automation alone. It requires a multi-faceted approach to building genuine relationships with all the people who matter most to your company. Here are our quick steps for success. 

1. Rethink Employee Engagement and Incentives

Crucial relationships in the B2B world start with the connections you have with your employees. To delight and engage team members, you need to provide them with the right compensation, resources, training, and support. You also need to incentivise them to focus on relationship-building themselves.

This means spending less time rewarding sales agents and marketing teams based on the number of people they connect with, and more time rewarding them for their ability to build strong connections. Focus on metrics like average order value and customer lifetime value over a number of leads gained.

Additionally, take advantage of employee advocacy platforms. When employees are incentivised to become advocates for their company, they extend the reach and impact of relationship capital. Encourage teams to get involved in advocacy programs with rewards they care about whether it’s additional commissions, educational opportunities, or paid time off.

2. Unify Teams around Relationship Building Strategies

Once you’ve reconsidered how you approach employee engagement and incentives, the next step is to consider how you can bring your teams together in a unified approach to enhancing customer relationships. The first step here is connecting all of your customer-facing teams, from your sales team to your marketing and customer success team. 

All of these employees should have access to the same resources, and be able to share insights into customer profiles, preferences, and needs, so they can work together on delivering a unified experience. Allowing your sales, marketing, and customer success teams to collaborate more effectively will help you collect genuine insights into your customers. 

This is the information you’ll need to deliver genuinely personalised and unique experiences to each of your accounts, increasing average lifetime value and retention rates. Encourage everyone to take a role in making your organisation more “customer-focused.”

3. Empower your Entire Ecosystem

Finally, as mentioned above, the benefits of relationship capital extend to all of the crucial connections you have in your go-to-market ecosystem. If you work with channel partners, affiliates, and other specialists to expand your GTM reach, make sure you’re empowering them too. 

Provide them with the same data and insights you give the rest of your go-to-market team. Offer them access to training and technologies that can help them to personalise their pitches to customers, deliver better onboarding experiences, and elevate your brand’s reputation. 

Reward your partners just like you would your employees, and make sure you’re just as transparent and consistent when it comes to communicating with everyone in your network. Ensuring every partnership is mutually beneficial will ensure that your partners will go above and beyond to support your GTM strategies, and improve the results of your campaigns. 

The happier, and more connected your GTM ecosystem is, the faster you’ll be able to scale, without compromising on delivering a personalised customer experience. 

Make Relationship Capital your Secret Weapon

The power of relationship capital might not be a new idea to modern B2B business leaders, but it’s something every company needs to rethink as we head into 2024. Relationships are still the key to success in the B2B landscape, from the connections you have with critical customers, to the links you build with employees and partners. 

Simply relying on AI and automation tools to help you maintain those relationships with personalisation at scale isn’t enough to thrive in today’s world. You need a holistic approach to building genuine connections with the right people. 

The good news is that while leveraging relationship capital can be complex, the long-term rewards are incredible, from increased opportunity for innovation to better customer retention. Ultimately, it’s this strategy that will help you to survive and thrive, even in difficult economic conditions and competitive markets throughout 2024 and beyond.