The 4 Most Important Things to Know About Your Client!
Here are the Metrics you need to know:
- Cost to obtain a new client - this is fairly obvious, but if your overall marketing and advertising budget is $5000 a month and you're signing 1 new client a month, their cost is $5000. Obviously, you can improve this number in two ways: close more clients under your current budget or drive down the cost of a single client.
- Lifetime value of a client - this is obvious too. How much does your best, worst and average customer spend with you and your firm during the lifetime of your relationship? Are you spending more to acquire them then they will spend across their lifetime? Are you leaving money on the table by focusing only on that initial transaction?
- New Client Lead-time - This is a big one. If you want consistency and predictability on your business you need to know how long it's going to take you to move a client from initial meeting through your marketing process to the cash register. The benefits to knowing this are beyond valuable.
- Client Lifecycle - How often does your client buy from you? Are you a weekly, monthly or annual service provider? Is your client's first purchase minor and they work up to larger products and services, or is their initial purchase the large one with smaller complimentary or perennial services later down the road?