Placing a Value on B2B Brand Loyalty
Acquiring new clients costs time and money. It is always far less expensive to keep an existing customer than it is to find a brand new one. How much more? Some experts place the number at seven times more to win a new customer compared to keeping an existing customer. For any business intent on growth, it is essential to dedicate brand building efforts toward not just attraction, but also retention. Otherwise, you’ll find yourself spending less time “growing” and more time “back-filling;” this is simply not a growth strategy.
Bob Harris, president of Attrition Busters, places a hard number on the cost of replacing a lost client. For every $1 of recurring revenue lost, Harris explains, it costs a business on average $58 to replace.
Losing clients is expensive, and not just in terms of money, but also reputation. A happy client will tell up to five people about the positive experience of working with your company. Unfortunately, a disgruntled ex-customer will tell up to 20 people about their negative experience.
We all have our misfires. Every now and then a client comes into our world that is simply not a good fit. I’m not a big advocate of the expression “firing clients,” as this language is fundamentally harsh. However, I am a believer in “politely parting ways.” I have done this several times, and I would estimate that 80% of former clients find reason to eventually return. But only if the door is left open and the parting of ways was completely positive.
Beyond the dollars and cents of client retention, it simply is a better way to conduct your business and brand. We can never take clients for granted, and think they will be content with “satisfied service.” Any customer who is “satisfied” is essentially already on the path to “disgruntled.” When it comes to b2b brands, satisfaction stinks. We must strive for delight at all times.
Brand growth is not just about new clients; it’s equally important to reaffirm your brand to existing relationships every single day. Plus, from a new business development standpoint, the odds are in your favor. The average probability of closing a new prospect is 5-20%; the probability close on existing relationships averages 50-70%.
It’s not just about brand building to new potential clients. Always think brand reaffirmation for existing ones. This can be accomplished in a variety of ways: special client recognition days and personalized messages, periodic gift giving, industry news, insight and intelligence, and positive brand touches that are timely, relevant and useful to them. The best part is: all of this can be systematic and automated.
Through client-focused brand strategies, we have helped clients grow their top line sales an average of 35% annually. A little brand TLC goes a long way.
Remember, clients don’t wake up thinking about you. You have to wake up thinking about them. Show them that your brand values them, and they will value you back.