The advent of a new year is the opportune time to take stock of your business and create new strategies for attracting new clients. However, it is also important to think about retaining existing loyal clients that helped your business succeed in the preceding year(s). Despite the fact that numerous companies ignore their existing clients in order to obtain new business, client retention is the bedrock of a sustainable business.

Due to increasing customer acquisition costs, as a small business owner it is imperative that you assume a proactive role in retaining your existing clients. In fact, studies from the U.S. Small Business Administration and U.S. Chamber of Commerce have found that acquiring new customers can cost as much as five to seven times more than retaining existing customers. Additionally, existing clients spend, on average, 67 percent more than new ones. 

So, how do you go about retaining existing clients? The following three examples will illustrate how. 

No. 1: Understand your clients. Understanding your clients, whether you are a restaurant owner, attorney, realtor, insurance agent, etc. is the key to client retention. A thorough understanding of your clients means anticipating their needs, thus exceeding their expectations, which can lead to increased customer loyalty and referrals. To achieve this, as a small business, always be attentive and courteous to your clients by offering personal service; utilize data, such as that found in your database or customer relationship management system, to better understand their needs; or, simply, ask them what they think, which can be achieved with a customer satisfaction survey and provides priceless insight.  

No. 2: Don’t try to be everything to everyone. Small businesses should always focus on quality over quantity. It is imperative to take pride in your product or service and to understand it is a two-way street when taking on a new client or retaining an existing client. The old adage that “the customer is always right” is no longer universally accepted. In fact, if you have an unreasonable client that consistently makes unreasonable demands, it is perfectly acceptable, and logical, to walk away from said client, as they will cause you and your team unwarranted stress and you could lose money and more time than expected dealing with a bad client. Always keep in mind that you know more about your business than the client, and not vice-versa. However, conversely, retaining an existing client that is loyal and easy to work with is paramount to your success.  

No. 3: Follow-through. Loyalty programs and personalized “check-ins” where you aren’t coming across like you’re selling anything can go a long way to make existing clients feel special and leave a positive impression about your business. Linking to a press release where you received an award or participated in a community event/cause will again increase the reader’s perception of you and your business. This ideally will result in either return business from the client down the road, or the most powerful form of marketing there is: word of mouth.