to connect. Lastly, be meticulous regarding your numbers; know your numbers and budget and forecast appropriately. Analyzing Your Client Base Long ago, I made a significant internal change whichmarkedly changedmy business. I separated my client list by vertical markets and classified each company into manageable channels according to the A-F categories below. There are many types of criteria; here are the ones I use: sales volume, profitability, opportunity to grow, openness of the client, communication, disposition, accounts receivable collectability, and if the client refers business to you. A Top-tier, or your ideal, excellent sales volume client B Above-average volume client C Middle-tier, good volume client D Lower-tier, fair volume client E Lowest-tier volume client; like orders once a year, fits all other criteria, no opportunity to grow F These are clients that no longer fit the criteria because they are bad payers, horrible communicators, always bid out projects, never refer clients and, in general, are not good people to work with. These types I would eliminate frommy client base and not take another order from them. It’s a tough call, but a necessary one. I evaluate my clients every quarter and adjust where they were onmy classification scale, as this process ties in directly withmy marketing efforts. Better Marketing By breaking downmy clients by vertical markets I can run reports to see which vertical markets are performing best. This allows me, when prospecting, to only target A/B type clients inmy top five vertical markets. Additionally, my marketing dollars are allocated in an 80/20 scale, with 80 percent dedicated to existing clients and broken out proportionally to my A-E listed clients, and the 20 percent is allocated to prospecting, but as stated, only to A/B type clients within those top five vertical markets. Other Considerations To Improve A Client’s Lifetime Value Customer Experience – Invest in customer experience by having an engaging interactive website. Have a relevant, engaging social media presence. Look at client portals, surveying their relevant, regular and consistent marketing; consider staying connected using video. Loyalty Programs – While these can be effective, be mindful of transparency and ask the question if the client can participate. Consider developing company stores with premiumproducts and services that you can use by sending clients reward codes to redeem them. Recognize And Reward – Offer a client of the month program, or perhaps you could develop a programwhereby a percentage of their sales (when they reach certain thresholds) could be donated to a charity of their choice. Close The Loop – Be proactive in your efforts, survey your clients, practice active listening and ask about improvements you could make that would enhance the client experience. Remember: Statistically, it is six times more costly to acquire a client than to keep one. Once you win them and if they are a great client, do everything you can to retain them. Client Base Categories A - Top-tier Ideal, excellent sales volume client B - Above-tier Above-average volume client C - Middle-tier Good volume client D - Lower-tier Fair volume client E - Lowest-tier Orders once a year, no opportunity to grow F - Not a fit People who are generally not good to work with 56 | DECEMBER 2021 | GROW
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