In the daily grind of building and maintaining a prosperous firm, many professionals miss the subtle signs that keep them from increasing their profits, providing additional services and increasing their referral base. This essentially relegates them to “one-and-done” seasonal practices that are little more than commodities with little client loyalty.
You need to create an ongoing resource as your clients’ lives unfold. However, before you can do that, you need to know your clientele. Don’t miss the indirect yet vital clues each one provides. It’s those elusive blurbs and comments that determine where they are in their lives and purchasing cycles.
Why is it so critical to pay attention to clients’ buying cycles? The statistics below provide some reasons:
- Merely increasing client retention rates by 5 percent increases profits by 25 to 95 percent, according to Frederick Reichheld in a study for the Harvard School of Business.
- Multiple direct response advertising studies have shown up to 95 percent of all ads written only target 5 percent of the intended audience.
- Conversely, the probability of selling to an existing client is 60 to 70 percent, while the likelihood of selling to a new prospect is only 5 to 20 percent.
You may be thinking, “Wait a minute, we invested in one of the best customer relationship management software programs available.” It’s true, a good CRM system can help companies manage their current and future client relationships and increase profits by automating, tracking and organizing that communication. However, the best technology in the world is rendered impotent if you don’t use it as intended.
In my nearly three decades of experience, I have found many professionals are anxious about making phone calls; often, they don’t know what to say or how to expand the conversation beyond the obvious. Sure, you can increase your number of daily client calls, but if all you say is a variation of “Hi, how are you; anything new with you? No? OK, talk to you next month,” then you’ve achieved nothing!
Here's the takeaway: When it comes to your clients, it’s more important to be interested than interesting.
Eliminate your fear; become a good listener. What your client says provides the next question. Approach the conversation as a relaxed chat with a friend. Begin with the topic you have in common, the work you’re doing for them. Ask about their work, their family, hobbies, etc. Then, casually ask about their plans, their children’s’ or spouse’s goals, etc. As they share information, take copious notes.
The majority of your conversations should be face to face or on the phone. Texting and emails are impersonal; your goal is to establish connections that sow the seeds of loyalty. Set up Google Alerts so you can receive links to articles on specific topics that align with your clients' interests and send the articles to them. If they are a business owner, suggest the possibility of exchanging referrals (as your relationship strengthens). All of this nurtures the bonding process.
About Edward Mendlowitz
Edward Mendlowitz, CPA, is partner at WithumSmith+Brown, PC, CPAs. He is the author of 24 books, including How to Review Tax Returns and Managing Your Tax Season.