Business owners work hard and invest substantially to acquire clients. Yet, once clients are converted they rarely utilise processes that maximise the client’s value. Acquiring a new client is between 6 to 20 times MORE costly than retaining and nurturing an existing one. Let us demonstrate.

Let’s say you advertise your coaching services in the Yellow Pages. Your ad costs $4,000 and you convert 10 clients. Your Cost of Acquisition is $400 per client. Each client is converted, on average, into a 3-month one-to-one coaching contract, valued at $1,500. Your gross profit is $1,100 ($1,500 – $400). Your net profit ($1,500 – $400 – all other expenses) is $750.

Most coaches stop there. They feel as though their job is done. In fact, some coaches have the perception that unless a client specifically requests additional services, it’s unethical to propose more services.

Of course, this paradigm of thinking is preposterous. Only by (ethically) getting your clients to undertake a wide range of products and services over an extended period of time can you be of significant value to your client. By limiting their access, for whatever reason, to valuable products and services, you are doing your clients a disservice.

The truth is – most businesses fail to think past their first core transaction. This is disappointing and destructive commercially. But it is most disappointing from a relationship perspective. If you can’t think past your first transaction, it is impossible to truly serve your clients. Only by approaching the relationship from the perspective of longevity can you create true, enduring value for your clients.

Do you know the number 1 reason clients cease to do business with you? Apathetic Despondence. Your clients don’t feel that you really care. In most cases it’s not that your client stops doing business with you – it is that you stop doing business with them!

Business owners think they’re doing their clients a wonderful service, simply by providing the bare skeleton necessities. They don’t create value in the relationship. They don’t develop a clear point of distinction. They don’t show they care.

As a purchaser of services and goods, how many transactions would you be involved in each year? Hundreds? Maybe even thousands? When was the last time you felt genuinely cared for; special; nurtured by a business? Possibly never!

If you’ve ever been fortunate enough to be served by a business person that genuinely cares about you, you know first hand the loyalty this creates. You buy from them again and again. You’ll travel ridiculous distances, pay more, and buy more frequently… simply because they care. And that makes you feel important.

An Economic Case

As well as the ethical case for retaining and nurturing clients, there is an excellent economical case. Referring to the example earlier, let’s see what happens when we nurture our clients.

Your Yellow Pages advertising resulted in 10 clients, each earning you a net profit of $750 each. At the end of the 3-month one-to-one contract the majority of coaches display their Apathetic Despondence and fail to nurture their client.

This results in the relationship reaching a ‘natural’ end. However, if you nurtured your client over an extended period, they may also invest in:

  • Teleconference Series ($197);
  • Bootcamp ($3,500);
  • Group Coaching ($1,000);
  • Seminars & Workshops ($500);
  • eBooks, eCourse, etc ($500).

That’s $5,697.00 income. You’ve multiplied your gross income by almost 4 times. Your nurturing costs are practically negligible, meaning your net profit has increased by 7 times!

This strategy alone can almost immediately turn a coaching business making $30,000 per year into a business earning $100,000 + per year.

This article is an extract of Module 31 of Coaching Club’s Ultimate Business Building Program (UCBBP). As a member, you can also access action and assessment sheets, six topic-related articles and audios, and much more. Step up on your development and join CoachIQ’s 30-day free trial today at www.coachingclub.com.au.