Imagine your business is a bucket. The customers (and the money) come pouring in. Eventually it’ll be so full it’ll be overflowing, right?
Not exactly. No business is perfect — So a more accurate analogy would be that your business is a leaky bucket. Somewhere in there, there’s a hole. Maybe even a couple of holes.
As customers get to these “holes,” they leak out of the bucket. Many of them never to return.
Kind of depressing, huh?
It doesn’t have to be! You just need to become an expert at finding and patching the holes. How do you do that?
Those holes are flaws in your customer acquisition and customer retention strategies. So let’s start by learning more about those.
For the last couple of blog posts, I’ve been talking mostly about customer acquisition, or strategies to bring in new customers.
I’ve mentioned this before, but it bears repeating because it’s important to understand for making your marketing plan:
Not everyone who encounters your business will hire you.
And that’s ok!
But that means that, in order to optimize your strategy, you’ll need to find a way to direct a lot of traffic to you. Like, a LOT of traffic.
Depending on your industry, average conversion rates (ie. the amount of visitors who turn into clients) are around 2-4%. What does that mean for you?
On the conservative side, if you have 10 spots to fill in a class, and your conversion rate is around 2%, that means you need 500 people to visit your website to fill all your spots.
Before you have a heart attack, let me clarify something! We’re only looking at website visitors in this example. This doesn’t take into account other marketing efforts like client referrals or emailing clients already on your email list. Some of those efforts may have way higher conversion rates than your website does.
But you still get the picture, right? Depending on your conversion rate — and the amount and types of tactics you’re using in your marketing — you probably need to get way more eyes on your service or product than you might think.
That’s why diversifying your efforts — and thinking through your funnel strategy — ultimately pays off.
So now that you’ve done all this work to bring in a bunch of visitors… You’re done, right?
Not quite! Focusing your entire strategy on constantly refilling your bucket could work. But that’s exhausting in the long run.
It also costs you way more money.
Yup. The numbers vary depending on where you find them, but acquiring a new customer can cost somewhere around five times as much as retaining an existing customer.
And the odds of success in selling to an existing customer are much higher as well: Selling to an existing customer has about a 60-70% success rate. Selling to a new customer? About 5-20%.
Additionally, customer retention is the key to happy customers — which in turn leads to client referrals, a proven tactic for garnering business.
Plugging the Leaks: How to Increase Customer Acquisition and Retention
Now you understand the strategies — and why they’re both equally important! Focusing solely on acquisition will cost you time, money and energy. Focusing solely on retention means if you lose even one regular customer — which, unfortunately, is likely to happen over time no matter how much you try to keep everyone happy — you may not be able to pay the bills that month.
You need a healthy balance of both to be successful.
So now that you know what causes the leaks, how can you close them up?
Optimize your website. A lot of people are first going to find you through your website. Shouldn’t it be set up to direct them toward hiring you? There are a couple of things you can do to optimize your site:
Write killer copy. Bland writing just isn’t gonna cut it! Whether it’s on your website, on social media, or anywhere else you’re talking about your business, you want to make sure your copy sells your services or products. Read more about writing for conversion here.
Use the magic of psychology to “train” your customers. There are plenty of dog trainer tricks you can use to attract clients — and get them to come back! Here are two of my favorites:
- Backchain your marketing plan to bring potential clients into your funnel
- Use reward principles to entice them back to you
Create loyalty by showing you care. Whether it’s by staying in touch through an email newsletter, personally following up (and getting a non-awkward testimonial in the process!), building an authentic connection through your storytelling, or through an actual loyalty program, there’s no right way to show your customers you care about them!
Want to learn more about marketing strategies for pet professionals? My Business End of the Dog: Marketing for Pet Professionals class is now open for registration! Learn more on FDSA, here.