The Best Client You Already Have: The Basics of Client Retention with Laurin Thienes
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Like many of you, I fell into the world of entrepreneurship by default. I didn’t have an MBA or any business classes under my belt. I started out not really knowing what I was doing at all. Fast-forward almost 20 years, and the most valuable thing I’ve learned after those rough-and-tumble two decades is this: It is easier to work with the same client multiple times than it is to find new clients. Think two words: client retention.
Business experts generally agree that it is cheaper by a ratio of five to one to sell to an existing client than it is to find a new one. Existing clients know your policies, pricing structure and processes, and you don’t have to do a hard sell. No one likes being hard sold, except maybe masochists who get their kicks dropping by used car lots for abuse.
Your new client doesn’t know anything about you up front, which takes time (and money) to explain. Until you start working with them, you might repeat this process over and over with multiple people until you earn a penny. Client retention, on the other hand, skips the initial part of the sales cycle because it has already happened. And in photography, a client’s comfort level with you in front of the camera is equally important and almost always improves as the relationship matures.
A second and equally important term that goes hand in hand with retention is churn. Churn is the rate at which you lose clients. While there are a million models telling you which rate is right for your business, you have to determine what rate you are ok with. This article focuses on retention, but I urge you to research the connection between retention and churn rates.
Shoot & Burn—A Zero Sum Game
The quickest way to lose repeat business is by not offering prints or products, and just handing over everything you shot to your client. Maybe they come back to be photographed again (taking up more of your valuable time), but aside from the funds you captured up front, your job is done. And so is your revenue stream from that client. If your goal with your photography business is to not make a living, keep on operating as a shoot-and-burn photographer.
There are shoot-and-burners who do just fine, I won’t argue that point. But think about the value of your time, the importance of maintaining your client base and, ultimately, the effect that shoot and burn has on your retention and churn rates.
Client Retention as Policy
As your business matures, so should your retention efforts. Shutter Magazine, and every other trade publication, is flooded with articles discussing the importance of maintaining a social media presence. And that is imperative to your retention policy. Your constant engagement with your existing client base can be naturally and organically cultivated through your social media channels. The presence of your brand in front of your clients is among the most important advertising you can do without explicitly trying to sell something. Constant personal engagement is also a major added bonus. You can take that retention policy further by advertising special deals and referral bonuses exclusive to existing clients.
Customer Experience Rules All
The differences in quality between luxury brands and their generic equivalent are often negligible. Maybe you can’t tell the difference between a Rolex and a knockoff. But the Rolex salesperson treats sales differently. The experience is followed up with a handwritten thank-you card. A birthday card. A phone call a few weeks later to make sure you are 100 percent satisfied.
Everyone likes to be treated as if they are the only people who exist when they are spending a lot of money. Each touch point you make with your client matters. If you forget about them, they are much more likely to forget about you. The little bit of money you spend on whatever touch point you make will be the best advertising dollar you spend. The power of a hand-delivered bottle of wine around the holidays to your top clients, for example, goes a long way.
Tracking & Reporting
So you’ve implemented everything you possibly can for client retention and to reduce your churn rate. Is it working? You’ll need to track everything you have done. To guide your tracking, ask yourself these questions: What percentage of past clients come back each year? Can you make changes to make that percentage higher? If quantifiable, what method of client engagement helped increase your retention rate? How much did it cost?
Identifying the metrics that are important to you is imperative to the success of your business and your retention efforts.
This article started with concepts and closed with tracking the implementation of those concepts. This has been said a million times, and it bears repeating: It is better to be awesome at business than it is to be the best at your craft. Sound business principles will save you when other things fail. Solid business practices will always be your backbone.
As you begin the new year, make client retention a top focus. With motivation and focus, you’ll find that your retention efforts will be the most important use of your time.