marketing secrets and techniques to get you more business

 

Lifetime Value Of A Client

When you spend money on advertising do you consider the lifetime value of a client? This is when you calculate how much money you will make from a single client over the life of that client. If you are just marketing to get new clients but then doing nothing to keep those clients then you are missing out on a large amount of money.

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Depending on the type of industry you are in the lifetime value of a client can be quite different. The way to figure this out for your company is deciding on how many times does your client need your services? If you cut lawn for a living this could be a weekly service. If you are a plumber then you can expect to see the same client every six months to three years. Three years is a long time so you need to do something to keep that person from forgetting about you and using another plumbing company at a later date.

Here is the formula:

Average price per visit X number of visitors per year X Life of client (I use 8 years)

For example:

Plumbing Business

Average price $400 X 1 year X 8 = $3,200.00

Hair Stylist

Average Price $30 X 9 X 8 = $2,160.00

 

Couple this with the fact that repeat clients will get to know and trust you much better than someone that just hires you once. That trust will directly reflect the number of referrals that you will get from those clients.

How do you keep these clients as lifetime clients instead of just a one time client? One way is to make sure that you give the best service that you can the first time you or one of your employees is working for that client. That will start the level of trust off very high. From that point you need to do a little work. You can create a newsletter that you will send out to each of your clients once a month of even once a quarter (every 3 months). This does seem like a lot of work, but statistics prove that a past client will use you more and pay you higher than a first time client. They will also give you a lot more referrals, which creates a much higher trust factor for that client as well. If you are tired of those low priced clients that only care about price and not service then this is the way to go for you.

Also see methods of marketing for any business.

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