How much of your 2021 budget are you planning to put towards growing your existing client accounts?
Let’s be honest identifying and nurturing relationships from cold isn’t easy. We all invest a lot of time, budget and resource in customer acquisition – and rightly so – yet I still see too many firms neglecting the opportunities that exist within their current client accounts.
A report by Demand Gen found that 81% of organisations have strategies in place for nurturing prospects along the buyer journey, yet less than a third (29%) of B2B buyers feel they have an active engagement with the brands that they buy from. Of course, these numbers aren’t specific to professional services, and I would actually suspect numbers to be a bit more positive in our industry, but the overall point certainly rings true. We’re not doing enough to maximise opportunities in our existing accounts.
The success rate of selling to an existing customer is by all accounts 60-70%, compared to 5-20% with a new customer. And it makes sense. How much of your 2021 budget are you planning to put towards retaining and growing your existing client accounts?
With many of you in the midst of 2021 planning, we thought we’d share three reasons that might help you build business cases for an increased investment to retention marketing…
Your competitors will be working hard at building relationships with your key accounts, it will be an important part of their 2021 planning, so you need to ensure that’s wasted effort.
Your competitors will be working hard at building relationships with your key accounts, it will be an important part of their 2021 planning, so you need to ensure that’s wasted effort. We know how hard winning new clients is, so every time you lose one, that’s one more prospect you have to convert, and that isn’t easy. Research by ‘Super Office’ reported that 68% of clients who took their business elsewhere said that they did so because they felt the firm no longer cared about them. There’s no excuse for a client to walk away feeling undervalued. Include them in your thought leadership. Ensure they are invited to your events. Involve them in your product/service development. Hold client user groups. Take action on your client satisfaction surveys. It doesn’t need to be difficult.
Two thirds of tech buyers said they would purchase more from existing providers if they saw value from their initial investment being clearly demonstrated.
Research from Gartner backs this up when they reported that two thirds of tech buyers said they would purchase more from existing providers if they saw value from their initial investment being clearly demonstrated. Retention is as much about demonstrating the value you have already provided to these accounts as it is giving them more.
As I mentioned at the start of this piece account expansion is far more valuable and efficient than customer acquisition. Your current clients will generally be more reliable buyers and their purchases will tend to have higher margins. This is due to their familiarity and understanding of your firm – you don’t need to spend time and money explaining what you do as you’ve already proved yourself. Also, if the relationship is strong, you’re less likely to be in a competitive pitch scenario; as a result, cost of sale is less, and margins are higher.
Effective client advocates are worth their weight in gold, which is yet another reason to cherish those established accounts.
Effective client advocates are worth their weight in gold, which is yet another reason to cherish those established accounts. Your existing clients can have a powerful influence with your prospects and involving them in your sales process through white paper contributions, blog interviews, video testimonials and case studies, and speaking at conferences will provide invaluable social proofing for your new business development teams.
Investing time, budget and resource in your existing client base should be an important source of growth in 2021.
The economist Theodore Levitt once wrote “The purpose of any business is to create and keep a customer.” Simple, wise words, but an important reminder to us all. Happy planning.