A few years ago, we wrote an article on the value of client retention. Part one outlined some common reasons companies lose customers and how to keep hold of customers if you’re losing them on a regular basis.
In part two, we want to expand on client retention’s true value and give you four simple to implement retention strategies to inspire loyalty, maintain your client list and increase profits.
New vs Retained Clients
New clients are exciting, and depending on the service, you could be justified in charging more money than you do existing clients for similar work. So, why not go after new clients all the time?
The answer: It’s because the cost of acquisition is so much higher. The actual cost of obtaining a new client is often overlooked. A typical new client acquisition might include:
- Introduction meetings
- Proposal creation
- Sales meetings
- Briefing meetings
- Project management meetings (reviews)
And what’s your sales conversion rate? – how many times do you need to do all this to win one new client?
Some studies suggest client retention can cost 2-25 times less than client acquisition. A bird in the hand is worth two in the bush.
If you haven’t already, spend time working out how much it costs you to obtain a new client – you’ll be surprised.
For more information on the value of holding onto clients, read part one.
Four client retention strategies
Onboarding is all about teaching your customers how to get the best from your product or service. When users first start working with your product or service, they may get frustrated if they don’t understand how to get the best from it. Deadlines and external pressures may lead them to discount your solution over the smallest detail. Onboarding helps users learn intricacies and how to problem solve challenges themselves.
As an example, if your company build websites. First, your onboarding strategy might include a guide for someone who has no idea how to build a website – this could consist of a technical jargoon breakdown to help ease any language barriers.
Next, once the website is built, spend time with your client teaching them how to use the website, update their content and add new features.
As a result, you’ll have fewer support requests, and they’ll feel more ownership and pride. At the very least, they’ll know what’s possible and how to ask for it in a language you both understand.
2) Customer feedback loop
Although we also covered this in part one, we wanted to elaborate further on the importance of Feedback.
It’s hard to know what you’re doing right or wrong if you don’t ask. If you get feedback, it should always be looked at in two ways.
Say, Mrs Jones hates the flowers you sent her because they died within 3-days. First, address the individual needs of Mrs Jones and ensure that the client is happy – or at least answered. Following this, take a step back and look at the broader picture – removing all individuality – is this a bigger problem, and only Mrs Jones is speaking out?
More often than not, one person’s voice is an indication of how others might be feeling. Mrs Jones’ flowers might have died after 3-days because they were sitting over a radiator. How many other people are doing that, not telling you and thinking it’s your flowers. Why not use this as an onboarding process and include a handy ‘get the best from your flowers’ guide with every purchase.
The same goes for positive feedback. If someone loves your services, how can you get the most from it- is there an opportunity for a new product or service?
After this comes the ‘loop’ part: When you implement a new idea based on feedback, pay attention to customers’ responses and follow the same steps of gathering feedback and implementing new ideas.
Customers love to be heard. If you’re open and transparent with your feedback, you’ll not only increase loyalty, but your product and services will improve – helping you attracts new clients and retain the clients you have.
3)Lapsed client communication calendar
Keeping track of all your customers (past and present) can be challenging. Smaller clients who only worked with you once and contributed a small amount to the bottom line can be overlooked. While it might take some project management time to get lapsed clients on board again, it’s still more cost-effective than attracting a brand new (cold) client.
Create a date in the diary each month/quarter to review lapsed clients in a batch can reduce the overall time expenditure. Include details of new products and services that weren’t around the last time you worked with them or a case study of a successful project.
A company newsletter is a simple and cost-effective way of reminding customers of your brand, products and services – helping to retain customers.
Today, sending, scheduling and automating these emails is simple. Platforms like Mailchimp can help you create personalised, dynamic content that looks like the email was written specifically for the individual, not the masses.
Hold onto clients
Following these four steps will not only help hold onto clients, but it will help you deliver a better service.
- Onboarding customers will build relationships and help promote brand advocacy.
- Feedback will help you deliver a better service. You’ll build better relationships with your customers and demonstrate your willingness to progress.
- Keeping in contact with lapsed clients will dramatically reduce ‘client churn’; you’ll also build a specific target marketing segment for new products as you know these clients are interested in what you can deliver (low hanging fruit).
- Newsletters will remind customers of your brand every time they open their inbox. They may not need you all the time, but your brand will be remembered when they do.
How can ETC help
If you need help in retaining more clients or understanding the cost of obtaining new clients, please get in touch.
If you are new to ETC, why not contact us for a free new business review? We’ll spend two hours with you, giving you professional coaching and will leave you with actions for immediate implementation.