This mash-up is inspired by a lawyer I know who thinks that signing new clients solves all his problems. He’s certainly not listening to Gina Rubel:
As a legal marketer, I am constantly reading articles for lawyers about business development. Common titles are “Biz Dev for Lawyers,” “How to Be a Law Firm Rainmaker,” “How to Bring Business to Your Law Firm,” “Using Social Media to Grow Your Book of Business,” and so on. While everyone is pushing the acquisition of new business, how about focusing on the low-hanging fruit–the clients who already trust you with their business.
Smart businesses don’t chase new clients at the expense of keeping and growing existing clients. And, law firms shouldn’t either. Consider:
- 80% of future revenue will come from just 20% of your existing clients–Gartner Group
- It’s 50% easier to sell to existing clients than to new clients–Marketing Metrics
- Existing clients convert at 60-70% compared to new prospects at 5-20%–Marketing Metrics
- Repeat clients spend 33% more compared to new clients–CMO.com
- Boosting client retention by 5% can raise profits by 75%–Bain and Company
- A 10% rise in customer retention yields a 30% increase in the value of the company–Bain and Company
Look to the business world for how they view the significance of an existing client relationship. Here’s a sampling of the research I complied:
From It’s Cheaper to Keep ‘Em by Karl Stark and Bill Stewart:
Growing businesses tend to spend so much of their time and money acquiring new customers that they often overlook their best source of growth: retaining and growing their existing customer base. It’s cheaper, easier, and more effective to retain current customers than it is to acquire new ones.
Seeking new sales without strong account management and operating teams is like pouring water into a bucket with a hole in it. Identifying and fixing the holes — the gaps in customer satisfaction — can help your company retain existing accounts and increase new sales. When attempting to generate a sustained increase in sales, the first place to start is with existing customers. Your selling investment is lower, you have an existing relationship…
…[M]any entrepreneurs are so focused on gaining new clients and customers that they fail to effectively address the need to retain those they already have. This is counterproductive… …[B]eing passive about customer retention only leads to greater attrition.
Customer retention and customer acquisition don’t have to be two parallel lines that never meet. In fact, when done right, customer retention campaigns can actually bring in new business. How? Through word-of-mouth and referrals, of course. By implementing smart retention strategies and treating your customers well, you are increasing the likelihood of getting referrals. Referrals are priceless to just about any type of business…
When people have good relationships with individuals within an organization, they are more loyal. The only way to guarantee a loyal customer base is to create unbreakable bonds. This is done one person at a time. Social media changes the playing field because it provides a venue for the one-to-one connections that create unbreakable bonds.
Here are some practical strategies from Ross Beard–a client retention expert–that will help you improve client retention and raise your bottom line:
- Set client expectations: set expectations early and deliver faithfully on those expectations to build retention.
- Be the expert: trusted advisors proactively communicates with clients about issues in their industry that will affect them.
- Build trust through relationships: client relationships must be based on trust and shared values; blog about issues that help your clients and signal your interest in their business.
- Implement anticipatory service: avoid negative client experiences by being proactive: stop problems from happening by checking in with your clients each quarter.
- Make use of automation: standardize your processes and set expectations for service levels to increase client loyalty.
- Build KPIs around client service: measure and incentivize your firm based on levels of service/performance tied to the client’s goals.
- Build relationships online: your clients are online so build relationships with them while they are fixed to their computer screens via Linkedin, Twitter, Facebook, blogging, etc.
- Go above and beyond what’s expected: look for opportunities to woo your clients to build long term loyalty.
- Listen to your clients: implement client surveys, etc.
Read Beard’s 9 Customer Retention Strategies For Companies for more insights, strategies and examples.
How are you building enduring client relationships? How do you retain your clients for the long haul? How are you managing your client accounts? How do you deal with that buffoon lawyer who chases clients away?