Cultivating your clients is one of the most beneficial things you can do for your business. Cultivation is nurturing, caring, and helping foster growth with your existing client base. While it is important to acquire new clients, building and enhancing the relationships with your existing ones is inimitable.
“It Cost 7 Times More to Acquire a New Client, than it does to Cultivate an Existing One”
A blog by Ethan Bloch really makes you think about the time/money/process that goes into acquiring a new client. These factors relate to the cost of acquiring a new client: marketing/advertising, selling/pitching yourself, setting up the new accounts, time for meetings/calls/emails, price sensitivity discussions, and much more.
Now think about the profits from your existing, satisfied clients. These clients possess: a reduced price sensitivity, reduced competitor switching, more repeatative purchasing, more referrals, and your relationship/brand is already established with them.
How to Cultivate Existing Clients
Existing clients are much more profitable than new ones. But the key is to know how to cultivate them. Each client is different, and the best way to find out what they want specifically, is simply to ask them. Whether it is sending out a survey to gauge their feedback or having a face-to-face meeting to discuss just their wants/needs, it is easier to engage your client for the long-term when you show interest and take action to help them and your company grow. One way to cultivate clients is to build a client touch program – and implement it successfully.
Some Facts About Cultivation
A few need to know facts:
- 91% of companies do nothing to retain their clients; the average American business loses 50% of its customers every five years – according to Harvard Business Review
- A 10% increase in customer retention is equal to a 30% increase in company value, according to Bain & Co.
- You are 4 times more likely to do business with an existing customer versus a new customer, according to Forbes
- The probability of selling to an existing customer is 60-70% vs. 5-20% to a new customer, according to RocketWatcher
Why do you think it’s easier to sell to existing clients? Because, the client already knows you and your capabilities, right? Whether you are offering new services to your existing clients or trying to ensure those clients are aware of your full capabilities, consider developing a client touch program. A touch program includes ways your firm can expand current offerings to existing clients. With an hour or two for planning and a few hours per month in execution, this type of program is easy to maintain and can be very profitable.