In today’s VUCA world with never-ending inflow of new and often disrupting market entrants, the ability of a company to maximize the lifetime value coming from each client is absolutely essential. It is no longer about just “keeping them” or “making them stay”.
Last week we started exploring the needed shift from aiming for high Client Retention to true Client Value Maximization. We looked at the three common mistakes many companies do, costing them significant potential revenue loss, being:
Mistake #1: Focusing on achieving a high retention number, in isolation.
Mistake #2: Engaging in no or poor validation of client’s situation assuming “old same”.
Mistake #3: Not sharing all you have in store, incl. new products/services, biz progress etc.
In this series we are going to explore the three key components of achieving the top client value maximization, starting with the first component today: Getting the foundation right with the following steps:
#1 INTERNAL ALIGNMENT
Primarily, internal alignment is crucial in order to make sure that everybody in your business understands what are you trying to achieve. The mentality should be changed from the “us” perspective, driven by fear of losing clients by statements as “We need to keep them / make them stay”. It should change to “them” perspective, putting the clients in the center of attention, delivering maximum value to them, even if it means letting clients go (in case you see you can’t provide them with the results they desire) or growing them (by spotting growth opportunities to maximize the value created for them). Internal alignment means not putting such high emphasis on the high retention number in isolation anymore.
Check: What alignment, compensation and strategy is driving your success?
- Is your team aligned on what are you trying to achieve in regards to your current clients?
- How is your team compensated – linked to high retention numbers or value maximization?
- Is there a clear Client Value Maximization strategy in place?
#2 CLIENT DATABASE
The second non-negotiable essential is having a decent client database. A CRM system (or at least an excel list) where all client-related information and communication is stored. In todays tech-driven world, data analytics and automation is absolutely critical in achieving sustainable business growth. If you are still wasting time with manual-heavy processes, this is a big red flag to address with priority. Today, it is very easy to gather valuable data from and about your clients, helping you to serve them better.
Check: Do you collect, store and analyze the key data points about your current clients?
- Who are they? – Demographics, geographic location, belief system, hobbies, etc.
- Why did they choose you? – What made them select you? What did you offer that others didn’t? What did you / your sales team do differently?
- How did they find you? – Was it through a Facebook ad? Linkedin? Friend referral? Website? Event? Or elsewhere? Which channel is gaining most traction?
- What is their current challenge? – What pain-points do they face? What is their current need? What do they desire?
- What products / services do they purchase now? – What is their current contract / are their purchasing habits? What is their current investment / budget?
- What communication was sent to them already (offers, invites, follow-ups) and what is the next scheduled action item?
Nowadays, there are infinite off-the-shelf or customizable CRM systems allowing you to build an up-to-date and powerful database of clients, collecting information, using automated features of client tagging, email marketing / communication etc. Don’t forget that one size doesn’t fit all. Select the right CRM system for you and your business, exploring for example: http://infusionsoft.com, https://www.aweber.com, http://insightly.com, https://www.zoho.eu/crm/ or http://odoo.com.
#3 DEFINED PROCESSES
The third step is to define the internal processes related to Client Value Maximization. This doesn’t mean to create rigid and bottleneck-creating systems. On contrary. It means achieving agility, speed and efficiency.
Check: How are you handling current processes in-house?
- How do you encourage best practice sharing – replicating success achieved for one client to other client accounts? Do you share such best practice via regularly held internal meetings, internal newsletter or an interactive intranet?
- How is information and documentation captured and stored? Or does it disappear once a team-member leaves, as information got stored only in his/her head or disconnected mailbox?
- Is CRM data entry easy, mobile and allowed when “on the run” or offline?
- Do you enable your team members to provide tool / process / system improvements? Do you allow them to co-create and be involved?
- What onboarding and training do you offer to your sales / client managers assuring they are ready and set for success? Do you offer videos, specific documents or a shadowing opportunity?
YOUR TURN!
Shift from aiming for high client retention numbers and assure a top client value maximization strategy by getting the foundation right first. Make sure your team members are aligned, build a powerful client database providing you with valuable data and allowing automation and define processes which will help you gain agility, speed and efficiency.
