Which matters more to your business: client relationships or metrics? This is a trick question! As an entrepreneur, you need to nurture both of them. The key to success is keeping the two in balance. This is admittedly easier said than done. Charlene Walters, Vice Provost and Dean of the Strayer Digital Entrepreneurship MBA, says that people often make the mistake of overemphasizing metrics.
Too Fixated on Sales Figures
Of course you want to make sales and hit your revenue goals,” says Walters. “But you can’t neglect building rapport with clients. By getting to know people outside of the sale, you earn their trust and respect.” This, in turn, can lead to sales and hopefully long-term customer loyalty.
“So often people are quick to try to get a sale,” says Walters, “They’re intensely present with the client until they get the order, and then they drop them abruptly. That’s the worst thing you can do.” Even if you do win a sale, this cut-and-run approach negatively impacts your chances of selling to this same client in the future.
Too Much Heart
It’s also possible to go too far in the other direction, where you’re catering to clients to the point of losing money on transactions or not getting any transactions at all. Perhaps your people skills are on point, but the relationships aren’t translating into revenue. This is not good business, because your company needs to be profitable to survive.
Where do you fall on the spectrum between head and heart, numbers and people? Depending on which side you need to strengthen to bring your business into balance, Charlene Walters has few strategies for you to try.
If you need to build better client relationships:
- Try to work a couple of personal questions into every client phone call, so it’s not purely transactional. How’s your day going so far? Any fun plans for the weekend? Learn their kids’ names, and ask how they’re doing from time to time. People enjoy talking about themselves, and appreciate when you take an interest in them.
- Follow clients on social media so you can get to know their personal sides. People often share family photos and hobbies on sites like Instagram and Facebook. If you learn that someone has a favorite football team, you could ask how the team is doing this season. If you see that someone loves cooking shows, ask them about recipes.
- Invite clients out for some fun. Get to know them better face to face by spending time with them. You could get tickets to a sporting event, or treat your customer to lunch.
If you need to improve your numbers game:
- Focus on the one metric that truly matters: revenue. It’s easy to get distracted by all kinds of data: number of social media followers, page views, email click-throughs, etc. When you’re just starting out, set your sights on the most important metric of all—the bottom line. You can focus on additional metrics later, once your profitability is solid.
- Set a revenue goal, and break it down into manageable steps. Walters recommends implementing a target number that is bound by time. Maybe you want to gain 100 new customers in 12 months, or make $100,000 in sales within 6 months. Once you’ve set your goal, map out the steps you’ll need to take to achieve it. For example, “To gain 100 new customers in a year, I’ll make 5 calls per day to prospective clients.”
- Put a good CRM system in place. This will help you track the sales and revenue for each client. Identify which clients are profitable and which ones aren’t, and invest your attention in them accordingly. If you discover that many of your contacts aren’t converting to sales, Walters recommends having an honest conversation that might go something like this: “I’ve really enjoyed getting to know you, and I’d love to do business with you, too. Is there anything standing in the way of this that I can address?”
If you’ve established a great rapport with someone and ask them this direct question, you might hear, “Nothing’s standing in the way. I’m ready to buy.” Or you might discover that the client isn’t committing to a sale because your product or service doesn’t meet their needs. If this is the case, it’s time to fine-tune your target market. Focus on prospective customers that have a need that can be addressed by your product or service.