Too often, we complicate what should be done by riddling our future with ambiguous steps on how to move forward. When you boil down all the semantics and muddy advice, there are only four ways you can grow your business. You can find a new client. You can increase the size of each transaction. You can increase the frequency of each transaction. Or you can reactivate transactions from old clients and relationships. Let’s break it down, one by one.
Find More New Clients
I was discussing marketing methods with a firm a few weeks back. They felt they could take more clients on, but were unsure how to do it. They were on the radio and did dinner events regularly. Instead of discussing what could be added, we looked at what was being done. After we broke down their dinner event’s numbers, we discovered that if they could raise their appointment setting by a few percent, increase their stick rate (those who keep their appointment) by a few percent, and increase their closing by a few percent, they would be overwhelmed with new business and be at capacity.
When we talk about finding more new clients, it doesn’t mean spend more money. Consider what you are already doing, and then work on doing it better. Stop trying to find the magic seminar, or the miracle phrase that converts people. It does not exist. What does exist is hard work and getting better at what you do. To find more clients, you don’t necessarily need to spend more money. In most cases, you need to get better at what you are doing.
Increase the Transaction Size
When McDonald’s sells a burger, they don’t make much money. The margins are not there. They make their money by asking “do you want fries with that”. The margins for them are in the sales of fries and soda. Amazon reports that around 35% of their revenue comes from the up-sell (and cross selling). What can you add to your menu of services that can be a money maker?
Increase the Frequency of Transactions
The frequency tends to be more relevant to retail businesses. However, when you consider how you structure your fees within your firm, you may find opportunity to grow. For example, do you bill monthly or quarterly for AUM? Do you have membership fees for on-going planning? If you don’t get all the assets up front, do you have them back in often to continue to get more and more of the portfolio? If you are a CPA firm, how often to you bill your clients? These questions can lead to more consistent cash flow and sometimes more business.
Reactivate Old Clients
The money is in the list. Those whom you did not close the first go around may change their mind. Their life may have taken a hard turn and now their needs have changed. You never know. Consider that you already have their information and that your list is free.
If you continue to provide value (not sales pitches) to inactive prospects or clients, you increase the probability that they will reach out to you when the time is right. Don’t email them to say that you email them. Provide real value. The money is in the list. Just like they say in the Field of Dreams, “Build it and they will come”.
In conclusion, do not try and tackle all four ways to grow your business. Pick one and spend a considerable amount of time developing plans and strategies that accomplish your goals with a sustainable and repeatable process or system.