In the fast-paced, highly competitive world of contracting, growing a business quickly is a priority for many. As a painting contractor, you're no exception. But what if the key to rapid growth isn't just about attracting new customers? What if there's a more efficient way to turbocharge your business? Let's delve into this concept and explore strategies to grow your contracting business faster than ever.
Rethinking Customer Acquisition: The Power of Customer Retention
A common misconception in business growth strategy is the obsession with acquiring new customers. In reality, the pursuit of new customers often leads to the neglect of the existing customer base. However, prioritizing current customers could be the secret to rapid business growth.
Consider this: your existing customers already know, like, and trust you. At some point, they've already given you a check or a credit card, which means they're approximately 80% more likely to do business with you again.
Why? Because they've already gone through the vetting process. If they've had a good experience with your service, they are less likely to shop around for other contractors. As a result, focusing on customer retention can save you significant time and resources that would otherwise be spent trying to convert new clients.
Let's dive deeper into this concept with an illustrative example.
The Math Behind Customer Retention
Let's say you have 60 customers, each providing an average sale of $500. This brings your total revenue to $30,000. Now, if you manage to sell better, provide higher value, and increase your average ticket size to $575, those same 60 customers now bring in $34,500. That's a $4,500 increase without acquiring a single new customer.
To gain that same $4,500 increase with new customers, you'd need nine additional clients, assuming the average sale remains at $500. But remember, acquiring new customers incurs costs like marketing, time spent on customer acquisition, and more. Depending on your trade and the number of leads you have, acquiring a new customer could cost you between a few hundred to a couple of thousand dollars.
When you crunch the numbers, it becomes clear that focusing on your current customers can offer significant growth without the added cost of new customer acquisition.
Crafting a Superior Customer Experience
To leverage the power of customer retention, you must focus on providing an exceptional customer experience. By becoming an expert in delivering an extraordinary service, you set a high standard in your customers' minds. This means any other contractor they work with in the future will be compared to you.
Your existing customers want to continue working with you. They are open to spending more money on your services, but there's a condition. You must continue to add value to their lives and remain relevant to their needs. In doing so, your sales can increase without having to add more customers.
Minding the Gap: Maximizing the Pre-Service Period
One key aspect of providing an exceptional customer experience is managing the time between the sale of a job and its execution – the gap. Many contractors sell the job, get the deposit, inform the customer of the job's start date, and then go radio silent. This approach can leave your customers feeling forgotten and open to considering other contractors.
Instead, use this gap to your advantage. Send your customers links to relevant content on your website, such as articles or videos on preparing their home for your services. Introduce your team members who will be involved in the job. This keeps the communication lines open and reassures your customers that they made the right choice.
Conclusion: Focusing on the Right Things
This week, take action to foster growth in your contracting business. Start with your existing client database, provide a better experience, and watch your business skyrocket. Remember, it's not always about more customers, but about delivering an excellent experience. By doing so, your customers will be more willing to spend more money with you, increasing your average job size and creating a self-sustaining ecosystem of growth and customer satisfaction.
In the end, it's about understanding your customers and their needs, providing them with a remarkable service experience, and constantly adding value to their lives. By focusing on these aspects, you can position your contracting business for rapid growth and long-term success.
Lastly, consider participating in contractor training events to further enhance your skills and knowledge. Regularly participating in these events can provide you with valuable insights and strategies to help you become more profitable, grow your team, be a better leader, and fully understand your business numbers.
So, take a step back from the frantic chase for new customers and focus on nurturing the ones you already have. You might just find that your contracting business will grow faster than you ever thought possible.