Crucial Information: Why You Must Know Who Your Top Clients Are
Does your business offer an amazing product or service, but for some reason, nobody cares? Are you doing all of the “right” things when it comes to marketing, but you’re not getting the traction you expect? If this sounds all too familiar, then you might be missing a crucial piece of information that could launch your business into the stratosphere.
If you want to grow your business, you must know who your Top Clients are. Your Top Clients are those clients who spend the most money with you and do not use more than their fair share of your time and resources (in other words, the most profitable). They think you are the coolest biz on the block, they refer their friends and colleagues to you, they rave about you on social media, and they make it easy for you to work with and serve them. All clients are not created equal, and those businesses who recognize this are ultimately the most successful.
Here are three important reasons why you MUST know who your Top Clients are:
1. Picture your ideal, very best client. Now imagine if you could clone that client over and over again, filling your business with boat loads of clients just like them. This scenario is possible, but only if you know who your best customers are. When you identify your best clients, you can also identify the qualities and demographics that make them your best clients. You can figure out where to find more clients like them. You will get to know them intimately – their likes and dislikes, what is most important to them, and what motivates them to buy your product or service. Once you know these things, you can create a Unique Offering that your Top Clients will care passionately about and want to purchase. Your marketing and sales messages will speak directly to those clients who you most want to attract.
2. Familiarity and repetition are the keys to creating a successful marketing campaign. It is commonly accepted that it takes 7 – 10 exposures to your business before a potential customer will recognize, remember and buy from you. It is much easier and less expensive to show up over and over again in front of a niche market, than to try to spread your message to a broad audience.
If you know who your Top Clients are, you can determine the qualities and characteristics that they have in common and carve out a niche, knowing that profitable customers who love your business already exist in that niche. When you market to a niche you have the advantage of standing out as THE expert, or THE product provider to that niche. Your marketing can become very focused, as you confine your time and dollars to a very specific market.
3. Your current Top Clients are you most profitable clients. According to the Pareto Principal, 80% of your profits will come from just 20% of your clients. If you know who those clients are, you can focus your attention on serving them better. It’s not only O.K. to treat some of your clients like V.I.P.’s, it’s actually really smart business. It’s much easier and less expensive to sell more to an existing client than to acquire a new client. Why not focus on developing products and services that make your Top Clients so happy that they buy more and more from you? If you know who your Top Clients are, you can ask them for feedback and information about your current products and services, as well as ideas for new offerings. Feedback from your Top Clients is ten times more valuable than feedback from random clients. In the process of making those Top Clients happy, you will attract more customers just like them, who will also be highly profitable.
Here’s an example of how it works. In “The Pumpkin Plan,” Mike Michalowicz writes about a colleague of his who applied the “play favorites” approach. He first evaluated his clients, and came up with the Top 9. Surprisingly, one of his biggest clients – Wal-Mart, didn’t make the cut. Even though Wal-Mart accounted for millions of dollars in business over the years, their rules and regulations around product packaging and delivery made Wal-Mart difficult and less profitable for a small business to deal with. Their second biggest customer, one of the “dollar” type stores, was much easier to work with and became their “Top Client.” As this company began to play favorites and treat their Top Clients like V.I.P.’s, something remarkable happened – the word got out to other “dollar” stores, and providing product to dollar store chains became their niche. His company took off, and he eventually sold it for $30 million.
Now that I’ve totally convinced you that you can’t go another day without knowing who your Top Clients are, you might be wondering how identify them. Here’s what you do:
1. List you clients in order of revenue, most to least.
2. Rate them on factors such as how much you love (or hate) them, if they pay you on time, how time consuming they are, whether they refer business, whether they give you repeat business, etc.
3. Pick out the clients who get the highest rankings across the board. Those are your Top Clients and represent your biggest opportunity. You can also pick out the ones who get the lowest rankings across the board – those are your worst clients, and represent a drain on your business. Consider firing them.