If you’re ready to make more money and better serve your clients and customers in the process…
Then this is for you!
In this blog, I’m going to share with you 5 strategies that can help you maximize your profits by as much as 95%.
Hey Posse! What’s up? It’s Alex.
Coming at ya this week with a tutorial to help all my freelancers and business owners out there scale their businesses WITHOUT raising your prices OR taking on a single new client or customer.
If there’s one topic that’s been top of mind for me and many other entrepreneurs lately it’s BURNOUT.
Look – running a business is hard work. That’s a fact.
But what if there was a way to ensure the long-term success of your business WITHOUT having to be in constant “hustle mode”?
Well, there is – and before I share it, I want to really simply break down the 3 ways you can grow your business… and this basically applies to every business out there. You can…
- Get more customers.
- Raise your prices.
- Get your current customers to buy MORE products and/or services from you.
And, even better, you can do a combo of all 3. But in my opinion, the EASIEST way to grow your business is to focus on #3… and I’m always surprised how few people focus on this despite the fact that it is WAY easier to turn a customer into a repeat or ongoing customer than it is to turn stranger on the Internet into a first-time customer.
On average, over 65% of small businesses’ revenue comes from REPEAT customers…
In fact, the VAST majority of my revenue comes from my existing customers. And if your business doesn’t reflect the same ratio, I promise you, you are working WAY too hard, and you need to start looking at your customer lifetime value or CLV.
Now, if you’re not familiar with customer lifetime value, it’s the total amount of money a customer is expected to spend on your products or services over their lifetime.
By increasing your CLV, you’re increasing the total amount of money the average customers spend with your brand.
This basically means your customers buying from you again and again.
While acquiring new customers is an essential component for growth and not something you should dismiss or ignore completely…
The fact is that it’s much more expensive to convert a first-time buyer than it is to retain existing customers. Especially now that it’s getting more and more expensive to buy people’s attention online.
In fact, it can cost up to five times more to acquire a new customer than it does to retain an existing one. Even if you’re a freelancer who doesn’t “pay” for traffic to gain new leads and customers, this STILL APPLIES.
Because think about how much time and energy you spend working with a NEW client vs working with a client you’ve worked with in the past.
It’s SO much easier to do add-on or ongoing work for an existing client than it is to onboard a new client.
Think about it this way…
Whether it’s a $200 on-off project or a $20,000/year retainer client – you still need to do a discovery call, map out the project scope, sign a contract and take time to learn their workflow, processes and brand voice. Whew… See what I mean?
So when you focus on getting repeat clients and customers, therefore increasing your CLV, you’re not only generating more revenue from each customer, but you’re also reducing your customer acquisition costs and opportunity costs…
According to research done by Frederick Reichheld of Bain & Company, increasing customer retention rates by 5% increase profits by 25% to 95%.
And with numbers like that, why in the world would you NOT focus on converting the people whose attention and trust you already have?!
Now… how do you increase your CLV – you ask?
Well, I’ve got 5 tips for ya – so let’s get into it.
Starting with #5 and ending with the #1 way to increase customer lifetime value (this one tip added an ADDITIONAL $1M to my bottom line in the past 2 years – so you’ll definitely want to read until the end for that tip!)
Personalized marketing will help you get way more bang for your buck because you are sending out HIGHLY personalized offers and promotions to your segments of your customers – based on their behavior, preferences, or interests.
This will boost your CLV, because when you’re sending targeted offers to your customers (rather than mass advertising) you’re speaking directly to them and what they’re actually interested in.
This makes them way more likely to A.) pay attention, and B.) buy from you again.
Here are a few examples of what this might look like and how you can implement it with your business to increase CLV…
Example 1: Relevant Product Recommendations
This is something you probably see ALL THE TIME when you’re on sites like Amazon or Netflix.
They provide personalized product recommendations to customers based on their past purchase behavior.
According to a study by McKinsey, 35% of what consumers purchase on Amazon and 75% of what they watch on Netflix come from product recommendations.
By recommending relevant products to your customers, based on something you already know they like, you have a higher likelihood of them making a repeat purchase (or to keep watching in Netflix’s case).
Here’s another example…
Example 2: Personalized Promotions
So you could use this same concept, except instead of making a suggestion – you’re giving a promotion or special offer.
For example, a pet store might send a promotion for dog food to customers who have previously purchased dog food. And they might also send out a promotion for cat food to customers who have purchased cat food.
So you’re not just showing them a product they’re likely to be interested in… you’re also incentivizing them to purchase by offering a promotion, discount, or special offer on it.
According to a study by Accenture, 91% of consumers are more likely to shop with brands that provide relevant offers and recommendations – so this can be huge!
As a freelancer, coach or consultant, think… how can I offer my client a personalized offer based on what I know they need support with?
#4: Upsells & Cross-Sells
Now this one isn’t only about retaining your current customers longer – it’s also about increasing the average customer order value with each transaction.
And you can do that in a couple of different ways. One way you might do this is through sellling add-on products or services to your existing customers…
So one example of this might be when you purchase a new laptop…
And as you’re in the process of checking out you see an offer pop-up for a laptop case specifically for the model of laptop you’re purchasing… Or maybe a software protection package…
These are offers designed to as add-ons or upsells to the purchase you’re already making. And of course – would add to the overall purchase amount.
Another example of this is when you order a burger at your fave fast food restaurant and they ask “Would you like to make that a combo meal?”
By getting you to add fries and a drink to your meal, they are increasing the amount of money you spend on that purchase – which boosts their CLV.
Another example of upselling might be when you register for a workshop and have the option to upgrade to a VIP experience – which would give you extra perks, additional materials, or a more intimate experience.
So while uspells are supplementary offers, cross-sells are complementary offers.
Like when you purchase face cream and you’re immediately offered eye cream…
Or you’ve purchased my brand new Brand Voice program to learn how to write a magnetic and captivating Brand Voice and then are later offered my Own The Inbox program to help you put your brand voice into action to write compelling and persuasive email campaigns.
Now, these are just a few examples of how you can utilize cross-selling and upselling in your business.
As a freelancer, coach or consultant, think… what can I offer my client that supplements or complements what I’ve already given them?
#3: Top-Notch Customer Service
One of the most important things you can do to increase your CLV is to provide top-notch customer service.
Here’s the thing…
If you want your customers to keep coming back, then you gotta give them a damn good reason to do so!
And if you’re not a pleasant brand to do business with, then chances are pretty low that anyone will come back – even if your product or service is amazing.
On the other hand…
When you’re friendly, helpful, and reply timely – you’ll build trust AND LOYALTY with your customers.
Which leads to happy customers.
And happy customers mean more repeat business, positive reviews, and referrals – all of which can increase your CLV and generate more revenue for your business!
And while being friendly, helpful, and responsive is by far the most important factor that goes into good customer service…
You could also use customer service as a more direct way to boost your CLV – by offering a loyalty program – which rewards customers for their loyalty and repeat purchases.
- 71% of consumers say loyalty programs are a meaningful part of their brand relationships.
- And 79% of consumers say loyalty programs make them more likely to continue doing business with brands.
My favorite coffee shop does this – every time I buy a coffee, I get a stamp on my little Loyalty Card. And once I have 5 stamps, I get a free coffee!
It’s good customer service in that it makes me feel valued and appreciated – but it’s also smart business because the promise of receiving free coffee incentives me to keep coming back for more coffee.
Which boosts CLV. Genius, huh?!
So as a freelancer, coach or consultant, think… how I go above and beyond and make my clients feel valued and appreciated?
#2: Frequent Communication
Yes, great customer service is important…
But just because you’re friendly, helpful, and responsive doesn’t necessarily mean you REALLY have a relationship with your customers.
You need to be ACTIVELY ENGAGING and connecting with your clients and customers on an ongoing basis.
Beyond the “how can I help you?” email.
Take the time to really listen and understand your them. Ask them what they need help with. Ask what questions they have and then go out of your way to answer them. Pop into their inbox regularly to check in.
You want to stay top of mind and keep your customers engaged with you and your brand.
A study by Harvard Business Review found that customers who are fully engaged with a brand spend 23% more than average customers.
So by simply taking a bit of time to engage and chat with your audience more frequently, you could significantly boost your CLV – how awesome is that?! So as a freelancer, coach or consultant, think…
When’s the last time I sent an email to a past client just to check in and say hi and see how they’re doing?
Alright now on the juiciest tip on this list…
#1: Grow With Your Customers
One of the best ways (and my personal favorite!) to increase your CLV is to create new products for the same audience.
By keeping in touch with your BEST customers – asking them what their needs are and how you can better serve them – you can develop new products that they actually NEED and want to buy…
But don’t just create new products for them to buy…
Create the product or service that will help them get to the NEXT LEVEL, so they don’t outgrow you.
Here’s the thing… if you’re serious about retaining your customers for the long haul then your business is going to have to grow with your audience.
Let me give you an example based on my brand – the Copy Posse. I started the Copy Posse (and a YouTube channel) with one target audience in mind – brand-new and aspiring copywriters.
This means that in the beginning days of my brand, almost all of my content was focused solely on helping new copywriters learn the skills they need to start a successful copywriting business from scratch.
Eventually, I created my first program – the Launch Pad – which helps new and aspiring copywriters learn how to write all the copywriting assets needed in a marketing funnel, create a portfolio of their work, and kickstart their copywriting business.
But as my customers graduate from this program and their copywriting businesses grow… they no longer need this “beginner” educational content.
This means if I want to retain them as a customer, then I need to produce content that’s relevant to where they are on their journey.
So over the years, my content and offers have naturally grown and expanded to continue to serve my audience.
Now I teach more in-depth marketing strategies ALONG WITH beginner content. So I’m still attracting new customers who need help with learning the basics of copywriting…
But I also have an entire Posse-verse of other programs and offers to help copywriters, marketers, and business owners at all levels.
And I’m currently working on a high-level marketing program that will be released later this year – specifically for existing copywriters and business owners looking to take the world by storm.
So you can see how my brand is really growing and expanding with my customers…
THIS strategy alone is how I added an additional $1M to my bottom line in the last 2 years without spending a single dollar on acquiring a new customer.
As a freelancer, coach or consultant, think… what’s a future challenge I can support my client with?
What was your #1 takeaway from this blog? Comment below and let me know.
Until next time, I’m Alex. Ciao for now!