We’ve spoken plenty about acquiring new clients for your coaching business. From ways to get your first life coaching client to understanding how to identify and attract the ideal coaching client, there is no dearth of tips on how one can learn to attract new clients into their coaching business.
But if you’re even a little bit familiar with the world of business, you’d know that acquiring new customers costs a business 5 to 10 times more than selling to an existing customer. According to HBR, it can be 5x to 25x more expensive to acquire a new customer! What’s even more interesting is that existing customers spend 67% more on average than new customers.
Despite these figures, most companies spend a much larger portion of their time, effort, and budget into client acquisition as opposed to client retention. This makes perfect sense of course if you’re at the very beginning stages of building your business, but for those who’ve had more experience and clients coming into their business on a regular basis, client retention should be as much of a focus as acquisition.
What is customer retention?
Customer retention is nothing but a measure of customer loyalty and refers to how well a brand or company can keep its customers returning over time. If a company has a high retention rate, that means that a majority of its customers are repeatedly choosing to purchase its products or services. Retaining customers over a period of time indicates that a company’s brand, product, or service is appealing, relevant, and useful enough to existing customers to encourage them to stay with the company instead of switching over to a competitor.
Why is client retention important?
It is found that coaches who implement strong strategies for customer retention can reap the following benefits:
- Higher profits: The likelihood of selling or upselling to existing clients is higher than the likelihood of selling to new clients – due to the simple factor that existing customers already know the standard of your services and already trust you more than a new customer.
- Lower marketing costs: With retaining existing clients, one doesn’t need to spend the same money on advertising as they have to in the client acquisition stage. You will spend less on retaining existing customers than you would to go out and find new customers.
- More clients by word of mouth: Existing clients who are satisfied & pleased with the coaching services, the way it is conducted and the results it is helping them see, will not only continue to work with them but also tell other people about their experience. Through powerful referral systems, you’ll be bringing in new leads into the business at much lower acquisition costs.
- More upselling opportunities: In the future, if you decide to add on more services to your repository of coaching services (a membership or a group or 1:1 mentorship program, for instance), the likelihood of existing/older customers trying those services is going to be much higher – you’ll find it easier to generate more revenue from one customer than to go out and find more.
Client retention strategies for coaches
1. Understand churn rate
Understanding churn is the first step in coming up with strategies for customer retention. Churn rate is essentially the number of customers a business loses in a given period of time – it can be calculated monthly, quarterly as well as annually. Let’s say, for instance, you typically offer a 1-year coaching contract and have a total of 100 clients on that 12-month contract. By the end of the year, if 15 of those customers choose to not continue employing your services, then you have a churn rate of 15%.
A high churn rate indicates you’re struggling to retain subscribers. The higher your churn rate, the more customers you’re losing.
To give you some perspective, Netflix has one of the lowest churn rates in the video streaming industry. Its monthly churn rate is strikingly low at 2.5%, which means that more than 97% of customers choose to stay.
By tracking subscriber behaviour and taking the effort to understand why customers are leaving, you can get insights into how to better tailor your customer experience as well as seamless automated tactics such as email marketing and promotional plans to prevent churn.
2. Be customer-centric in your approach
First impressions are very important. After the initial excitement of acquiring your coaching service or package wears off, most customers usually default back to the first experience they had with your brand. If that was a positive experience, then they are more likely to stick around.
For that reason, ensure that your onboarding experience is seamless. Make it as personalised & hands-on as possible and focus on removing as much friction as possible.
Aside from onboarding, customer service is another area on which to put major focus and attention. Develop clear and effective procedures to resolve customer issues. Go beyond the basic inquiry and identify what the customer is truly seeking. Continue to evolve procedures based on lessons learned and new opportunities.
Ensure customers receive the attention and answers they need, and you will find that the likelihood of a customer continuing business with you for longer periods increases significantly.
3. Get feedback [and take it seriously]
One of the most important aspects of client retention strategies for coaches is complaint management. A well-handled complaint can lead to increased customer loyalty. When you are able to understand customer sentiment and their likes/dislikes, you have a much greater ability to take action on their feedback, refine your approach, and meet their needs better.
As a coach, you should make it a habit to solicit customer feedback in various ways throughout the year. The most effective way to do this is to send out customer survey forms. This form can be quite simple with one question: “How likely are you to recommend [your coaching business name] to a friend?” on a 0-10 rating scale, followed by an open-ended question that allows them to give an in-depth explanation of their rating.
Another part of this strategy is to close the loop of feedback by sending a customized ‘thank you’ message to the customer feedback as a way of showing them that you’re listening and taking their feedback seriously.
Soliciting client feedback is one of the crucial client retention strategies for coaches. Clients appreciate when you’re open to constructive feedback as it makes them feel valued & heard.
4. Offer loyalty & referral programs
When a customer feels appreciated, they are more likely to stick around. Loyal and long-term customers should ideally be rewarded for their continued trust and support in your service. You can do this by sending bonus gifts at important intervals, offering discounts, or even set up a loyalty program in place. When executed properly and with your clients at the centre, a loyalty program can help motivate your clients to continue purchasing from you instead of switching to competitors.
Another good practice is a referral program – a great way to grow your coaching business. With a proper referral program in place, you can encourage existing clients to use word of mouth to market your coaching business.
To encourage your existing coaching clients to refer those in their circle to you, you can offer them certain rewards as part of your referral program – thus driving repeat purchases. You can do this by offering various incentives, such as by providing your service at a reduced rate, giving them something for free, or providing access to special content.
Implementing a referral program can be extremely beneficial for your business. These figures confirm precisely that:
5. Offer them something else they’ll like
When you have an add-on product or service to offer in addition to your primary offering, your existing customers have a higher chance of buying it than new folks, due to the presence of the ‘know, like, and trust’ factor.
If at a certain point in your business you are able to develop an ecosystem of offerings (such as courses, or ready-buy programs) – with different services and products at a range of different costs – having existing customers try out new additions first can prove to be an incredible strategy for customer retention. It also makes them feel a valued part of your brand and ecosystem.
6. Stay top of mind
Just because someone has become a customer doesn’t mean you should stop marketing to them. In today’s marketplace where competition is high and loyalty is low, stay top of mind is an absolute necessity.
This can be done via a number of customer retention strategies – weekly email newsletters, producing high-value content on social media (podcasts, free downloadable resources, videos, blogs, etc.) that will continue to add value to their lives beyond your product.
Another strategy to employ is to simply contact your clients before they contact you. This does wonders for the relationship because, in this day and age, most people are busy and don’t always have the time to stay in touch with you, even if they have the intention and desire to or have a problem they want addressed. By contacting your coaching clients first, you can build trust with them and show that you care and have their best interests in mind.
1. What are some client retention strategies for coaches?
Retaining coaching clients is actually much simpler activity than it seems. Just like for any business, client retention for coaches and coaching businesses include the following: paying attention to the churn rate, having different offerings that could be relevant to an existing client, getting feedback from existing clients and using the data to improve your services and experiences, staying top of mind through continued communication and marketing efforts, and offering valuable loyalty & referral programs.
Simply.Coach is an enterprise-grade coaching software designed to be used by individual coaches and coaching businesses. Trusted by ICF-accredited and EMCC-credentialed coaches worldwide, Simply.Coach is on a mission to elevate the experience and process of coaching with technology-led tools and solutions.