2 min readEnhancewell
Have you ever heard the old proverb, "a bird in the hand is worth two in the bush"? It's meant to help you be happy with what you've got instead of thinking bigger and taking risks that may yield a greater reward.
But it's not exactly true. One study shows that the success rate of selling to an existing customer is 60-70%, but selling to a new customer results in only a 5-20% success rate. In this scenario, one bird in your hand is worth up to 14 in the bush.
As a business owner, it's tempting to chase after new clients. After all, those new memberships really add up! However, when you stop chasing shiny new prospects, you'll find a goldmine in your existing clientele.
Increase customer retention
Did you know that increasing customer retention by 5% can grow your company's profits by up to 95%? I don't know about you, but that stat made my mind explode a little. 🤯 How is it possible that by keeping 5% of customers from switching to another gym, you can exponentially increase profits? The answer is simple. It costs up to five times more to attract a new customer than to keep an existing one. Just think about all the marketing dollars, free promotions (and the free-pass gym-hoppers you're sure to meet along the way), and staff time needed to welcome one new client.
Companies in the US lose more than $135 billion each year due to avoidable customer switching, and 33% of customers will consider switching after only one bad customer service experience. Just think about the last time you added a company to your "mortal enemy" list because of one bad customer service experience. I'm not naming names, but I still remember the smoothie shop that charged me full price for a 3/4-full cup. I never went there again.
Customer service isn't always fun. And we all know the customer is not always right. But if you want to keep your profits up, consider ways to enhance the customer experience and avoid the costs incurred by switches due to a bad experience. Stay on top of the customer experience by:
- Sending out occasional surveys
- Training employees on soft skills in addition to daily tasks
- Asking employees to make notes about complaints and identify any recurring themes
When you weigh the costs and benefits, correcting an error with a free service or upgrade is far cheaper than marketing to cold leads and onboarding a new client.
Promote additional products and services
Everyone wants new members, but your existing clients are far more likely to repurchase, refer, and try new offerings. Instead of trying to convince strangers to step inside your doors, discover new ways for your current members to achieve superfan status and help their friends do the same.
Consider adding weekend retreats, workshops, or merchandise to increase income streams that will engage your current base.
When you stop chasing shiny new clients, you'll find the true goldmine in your existing ones. Want to turn your current members into your biggest cheerleaders? Enhancewell can help! Get in touch today for a free consultation and discover the goldmine in your own business.