How much time do you put into making your clients happy?
How about for finding new clients?
Which takes more of your time?
Here’s hoping you said in keeping clients happy.
Research from Frederick Reichheld of Bain and Company [pdf] has found that increasing customer retention rates by 5 percent boosts profits by 25 to 95 percent. Marketing Metrics by Paul W. Ferris, et al., says that you have a 60 to 70 percent chance of selling to an existing customer and only 5 to 20 percent chance of selling to a new prospect.
Study after study has shown that it’s cheaper and more profitable to keep customers happy than to find new ones. The odds for keeping clients are ever in your favor.
Do you know your CAC, or client acquisition cost? Here’s how you can figure out how much your client is worth. Remember that once you acquire a client and it pays off, the rest is pure profit. Searching for new clients eats the profit you could earn just by making your client happy.
In the 15-plus years I’ve been in business, more than 80 percent of my work has been repeat business with current clients. When I land new clients, the majority come from referrals. And most of the time, those referrals come from clients.
How to keep clients
A small business owner who makes customer service a priority makes sure that every single employee has a role in that. Yes, even if the employee never connects with the customer. Being a team player and having a positive attitude is contagious. Motivated and engaged employees do their best every day.
Here are 16 ways to keep current clients.
- Dig deeper in getting to know your clients.
- Show clients you care about them.
- Stay in touch without selling anything.
- Take great care when working on clients’ products or projects.
- Answer client calls, emails, and messages promptly.
- Verify employees are friendly in client interactions, especially when dealing with problems.
- Listen to clients. Really listen.
- Follow through when clients report a problem, and provide timely updates.
- Take responsibility for problems, even if you’re not at fault.
- Don’t take loyalty for granted. Ever.
- Ask clients for permission to send emails, helpful information, and marketing materials.
- Create and maintain a CRM database to track client needs and identify loyal clients.
- Send a survey. Here’s a simple three-question survey to help turn clients into fans.
- Create a customer retention program that includes steps for getting clients to refer you to others.
- Thank them for referrals.
- Reward loyalty with discounts or bonuses.
For extra credit, here are 12 ways to help clients remember you.
Three ways to get more sales from clients
Repeat clients also spend more than new clients. The above list will help get more sales from clients. But here are a few more things you can do to get more business from clients.
1. Tell them about everything you offer.
Your clients may not know you offer other products or services that would help them. A clever way to do this is to send a personal letter to clients thanking them for their business. In the letter, list all your products or services with the ones they use checked off. They may know others who need your business.
2. Add complementary services or products.
Talk to clients to find out if they have any “it would be nice if you could … ” requests. After you make a list, do a survey to determine which would be in demand or do a small test.
Ask employees for new product and service ideas. Those who work closely with clients may already know what they may want. Or they might’ve noticed problems they’ve had that you could potentially solve.
3. Find the best times to pitch.
Timing can make a break a sale. For example, you know the days and weeks before April 15 is a very busy time of the year for CPAs. You’d want to reach them before they get busy, not within days of April 15.
Cyber Monday is a busy day for many online companies. Some companies have seen their servers crash from a sudden influx of visitors. If you’re a managed services or cloud-based services provider, you’d want to contact these businesses ahead of time to help them prepare for such a day.
Review your clients’ businesses to determine the best, worst and opportune times to contact them.
How to win back clients
It’s also easier to sell to former clients than to new ones! In Customer Winback, Jill Griffin and Michael W. Lowenstein say the success rate for bringing back former customers is 20 to 40 percent. Better odds than the 5 to 20 percent rate for new customers.
Why do you think customers leave or switch companies?
Most think it’s because the client’s needs have changed or they’ve found a better price.
A RightNow Technologies survey reports that 73 percent of the participants say they left because of customer service.
Customers accept companies make mistakes. It’s how the company responds to those mistakes that helps or hurts the relationship.
Recapture clients with these six steps:
- Apologize. (Use “I’m sorry” not “I apologize.” The former is more sincere.)
- Find out why the client left.
- Acknowledge the client as soon as you hear about the problem. Don’t wait until you have answers.
- Describe what you will do to solve the problem and prevent it from happening again.
- Provide timely updates on the problem and solution.
- Follow actions in the “Keep Clients” list when the client comes back.
It’s perplexing that any company would skimp on customer service when mounds of evidence show it’s a big factor for keeping customers. You’d think creating a culture of customer service would be no-brainer.
What will you do to enhance your customer service?
How can companies keep clients happy? Let us know in the comments section.
Image credit: Diego Garcia