The Statistics That Support Client Appreciation

An oft-repeated refrain, particularly when times are tight, is “I don’t have the money for client appreciation.”  Most businesses focus resources on new client acquisition and not on cultivating the relationships they already have with their current clients.  This allocation of time and money overlooks some critical statistics.

• It costs 5 times more to acquire a new client than to retain a current client.
• 68% of current clients who stop working with a business say they did not feel appreciated
• Experts vary in their estimates, but the gathered wisdom is that it takes anywhere from 7 to 16 contacts with a potential client to close a sale.
• The success rate for selling to a new client varies from 5-20%
• The success rate for selling to a current client varies from 60-70%

The cost in time, money and effort to obtain new clients can be explained by the fact that a new client needs to get to know, like and trust a business before it proceeds with a sale.  You have already crossed these hurdles with current clients, so it takes far less to cultivate current clients and encourage them to make further purchases.  When considering the statistics, it’s important to remember that the competition will be marketing to your clients, and clients who do not feel appreciated will be more receptive to exploring alternatives to your business.

How Current Clients Become a Source of Business Growth

Clients who have a positive experience offer many positive opportunities for your business. Obviously, repeat business is the start.  A client’s loyalty can inspire them to try additional goods or services offered by your business.  In addition, a happy client will offer quality testimonials and reviews, which are increasingly important factors in attracting new clients.  Finally, your current clients serve as your brand ambassadors.  They will make referrals and advocate for your business.

Staying Top of Mind Through Appreciation

A client appreciation program keeps you in touch with your current clients.  Regular contact should include requests for feedback, which provides you with information vital to improving your business.  These conversations are also an opportunity for you to talk to them about how they can help you.  This can be broached by simply inquiring whether they have any other needs you can attend to, requesting a review or asking if they can make a referral.  None of these asks can be made without follow-up and focus on your current clients, and if you do them in the context of appreciation, you will find the client more receptive to helping you out.

Making Client Appreciation Part of Your Overall Marketing Strategy

To continue to develop and expand your relationship with your clients, you want to help them focus on the value that you bring.  A well-conceived client appreciation strategy is an excellent way to stay top of mind.  As part of an overall marketing strategy, it takes some thought to make sure your program is authentic and effective.  VirtuArte offers a variety of client appreciation advice and services that you can use to maintain your most valuable resource.  We would love to connect with you for a complimentary strategy session to make the most of your client appreciation efforts.  Contact us here to set up your session today.

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If you ask a business owner how they are going to grow their business, most will tell you by attracting new leads and acquiring more clients.  Now, don’t get me wron,g there is a need for businesses to acquire new clients, but this is costly as a growth strategy.  It also ignores one of the business’s most valuable assets, its existing clients.

Why Client Retention Is More Cost-Effective Than Client Acquisition

Research by Invesp shows:

• Acquiring a new client costs five times more than retaining an existing client.
• The success rate of selling to an existing client is 60-70% while the success rate of selling to a new client is 5-20%; and
• Increasing client retention rates by 5% increases profit by 25-95%.

Focusing on client acquisition is a less cost-effective way to grow your business.  You’ve already invested marketing and sales resources in your existing clients and have built the know, like and trust with them.  They’ve purchased your products and/or services and started to develop a relationship with you and your business.  Existing clients are 50% more likely to try new products and spend 31% more.

How Loyal Clients Drive Referrals and New Leads

As these clients get to know your business and make more purchases, they are more likely to share your products and their experience with others.  Thus, you become both loyal clients and advocates for your business.  Existing clients can become a lead generation source for your business as they refer family, friends and colleagues.  Studies show 92% of potential leads trust personal recommendations more than any other kind of marketing.

Using Client Insights to Improve Products and Services

Your existing clients can also be your best source of information on the clients you are targeting, since they have already bought your product or service.  Their shopping habits and purchasing patterns can help you better understand why and how leads become clients, enabling you to refine your marketing and targeting efforts.  At the same time, these clients can provide you with feedback on how to improve your products and services, plus spot opportunities for new products to add to your current offerings.  Cross-selling, which can increase profits up to 40%, is easier with existing clients than with new clients.

The Long-Term Benefits of a Strong Client Retention Strategy

The importance of client retention on your business growth is clear.  It leads to:

• Spending less on marketing and advertising;
• Lower cost of acquiring new clients as your business gets more qualified referrals;
• Sales with higher margins as existing clients are less price conscious and value your business; and
• More repeat purchases because existing clients believe you offer superior products and/or services.

The benefits of client retention not only impact your revenue and profit, it can also impact your employee retention.  Focusing on client retention allows your employees to spend less time trying to acquire new customers, more time developing meaningful relationships with your existing clients leading to higher morale.  Work becomes less about sales and more about people.

How VirtuArte Helps Businesses Improve Client Retention

Client acquisition is important, but don’t make it your business’s sole priority.  Don’t neglect your existing clients.  A satisfied, loyal client is worth more than one who is not.  Don’t have a client retention strategy? Let VirtuArte help.  Contact us here or give us a call at 866.228.3497 to set up a complimentary strategy session to discuss options for your client retention efforts.

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