Many businesses focus their growth efforts on new business. That’s definitely an important component of any business and a successful growth model, but it can be putting the cart before the horse. Before you focus on opening new areas for new customers, it’s time you take a look at your client retention.
Client retention is the critical lifeblood of any business. If your business is unable to keep clients, you are unlikely to remain profitable over time. Keeping your clients happy and coming back is actually the most successful way to sustainably grow your business. What exactly will client retention mean for you?
- 80/20 Rule for Revenue: Did you know what 80% of your profits will come from 20% of your existing client base? Do you know who those clients are? If not, it’s time to take a closer look at your clientele. What are their demographics? What services and products are you providing them? Are their needs being met?
- Earn More: Now that you know your existing clients are your future revenue, how can you create that change? Maybe you need to keep them engaged with reminder emails, helpful tips, or consultations. Many businesses find increased revenue by creating new products, services, or packages for their existing customers to create a better experience while generating more income.
- Decrease Cost: We have some more statistics for you. Did you know it’s 10x more expensive to sign a new customer to your business than to keep an existing customer? Therefore you will do much better to keep your existing customers happy and returning than to spend 10x the cost on a new customer.
- Better Marketing: When you shift your priority to client retention and working with clients for the long haul, you are learning more and more about what they need, who they are, and what works. Once you’re ready to more actively pursue new clientele you’ll be better equipped to target and acquire them.
- Improved Business: Working to retain clients improves your services and process much more than simply finding new ones, because you are more aware of your business practices and onboarding routines. Keeping your existing clients will improve your entire business for the future.
If you operate a small accounting or bookkeeping business, you need to learn what client retention can do for you. Universal Accounting School offers courses and coaching to help you learn the principles of client retention, marketing, and growth that can help you increase your revenue and improve your practice.