Let’s step away from a discussion of strategy setting here, so that I can rant about all the reasons a strategy of “New Client Acquisition” is such a bad idea. This is something I feel very strongly about, and if you follow this blog regularly, I hope that you’ll become inclined to agree with me. (How strongly do I feel about it? Well, I wrote a book for the alternative health industry with the subtitle: “Why focusing on getting new clients destroys businesses.”)
It all comes back to the vision you have for your business. I firmly believe that it is impossible to have both a client-centric focus and a “New Client” focus.
The reason is simple: The fulfillment of a client-centric focus requires you to build a lasting relationship built on trust and the benefits you bring to your clients over time. This cannot be achieved in 1, or 3, or 5 interactions. And if attrition is an issue in your business (as it is in almost every business), any strategy that is primarily aimed at attracting new clients will be at odds with the vision and value of building long lasting relationships with your clientele.
At best, new clients are a necessary evil until they become “long term” clients.
At worst, they’re vampires who take disproportionate amounts of your time, resources, and energy, leaving you with too little to give to your long term clients.
Okay – that was a little hyperbolic.
Obviously,I’m not necessarily against new clients themselves – After all, every “long term” client was a new client at some point. And attrition is a normal part of any business, which means that without accepting some new clients, eventually your business will go bankrupt.
What I am so opposed to is not new clients, but rather the focus on getting new clients.
That’s why the subtitle wasn’t “Why new clients destroy businesses.” Or “Why new clients are evil and awful.” We’re going to talk about why new clients are a pain in the butt, but we can both acknowledge now that they’re not awful, or agents of ruin. Indeed, they can turn into that most precious of things – a long term client.
Most businesses have a primarily new client focus. They spend a lot of time trying to generate new clients, they bend over backwards to accommodate the new clients, and they mistakenly believe that they derive a lot of revenue from these new clients. We’ll talk about that shortly. But notice that with a focus on getting new clients, there’s less time, effort, energy and money left over to focus on existing clients.
And that’s a shame, because it’s by focusing on your existing clients that you can not only have a much more profitable business, and a business that runs much more smoothly, but also really make a difference in the lives of more people.
Whew. I am glad we cleared that up!