Do you want more clients or better clients
The key to growing your practice is not getting more clients, it’s getting better ones, says Patrick McLoughlin
Certain moments in our lives shape our futures. I was chasing Margaret for a couple of weeks before I finally got to speak to her. Payment was already a month late and we were about to down tools. She wasn't embarrassed to take my call, more annoyed by the “harassment”. She explained: “You'll have to wait in line like everyone else. When I get paid, you'll get paid.”
Clients like Margaret teach us an important lesson. It wasn't just the constant chasing for money, nothing was ever quite good enough for her. She always wanted more for less, and managing the relationship drained my energy and margins. When payment did eventually arrive, I called to tell her enough was enough. Working with her, and she wasn’t my only client like that, was drudgery. I knew I couldn't work with any more Margarets.
The low-fee/high-maintenance trap
When you think of your difficult clients, they tend to have a lot in common. They don’t appreciate or value your work; you’re a commodity, instantly replaceable.
There are warning signs. If you’re chosen because you’re cheaper, not because of the value you bring, the dynamics are different. Chances are they’ll move again when a cheaper service becomes available. As your client relationships are shorter, and your margins decline, you’re forced you to work and discount harder, to win more new business.
Yet when thoughts turn to growth, it’s always about more, not better clients. It’s judged by revenue, not profit. Effective marketing isn’t about the size of the net you cast, or even the weight of your catch. If you’re attracting the usual assortment of clients, more fees might not equate to higher earnings.
Before we blame clients for this race to the bottom, let’s put ourselves into their shoes. If accountants’ websites look the same, and partners make the same claims, how can they choose?
Now focus on your website, and how you describe your service. Are any of the claims below familiar?
• Pride in professional, high technical standards.
• Client focused, personal service.
• Leading and independent firm.
• Friendly, unique approach.
• Specialise in owner-managed businesses.
• Big enough to cope, small enough to care.
• Offer the full range of accountancy services.
You’ll struggle to find an accountant’s website that doesn’t make these claims. But when you think about it, your clients assume you’re all the above. When you look and feel like every other firm, prospects can’t tell you apart. If you force them to differentiate, they’ll choose by the only criteria left: price, and the lowest fee, usually wins.
All clients are not equal
Good marketing repels the Margarets, appealing only to those who benefit most from working with you. They’re your sweet spot. They’re happy to pay premium fees; they stay with you longer; they refer likeminded friends; and best of all, because they value you they’re a joy to work with.
Let’s start by grading your client base. Think about how you feel when you hear their voice on the phone. Where do they sit on the spectrum, from highly profitable and a joy to work with, to low/no margin moaners?
The work starts once you’ve identified you’ve perfect clients. Don’t assume you understand why they appreciate you. Instead, ask them:
• What they value about working with you?
• What problems and pains did you help them with?
• How are you different from their previous adviser?
Show, don’t tell
Some 2,000 years ago, Cicero said: “If you wish to persuade me, you must think my thoughts, feel my feelings, and speak my words.” So, record the words they use and try to look at yourself through their eyes.
Use case studies and testimonials to demonstrate how you’ve helped them overcome their problems and fulfil their aspirations. That’s how you can stand above the crowd. Not to everybody, just to your perfect clients.
Then you become a beacon, shining brightly to those you can best serve. Those that truly value the outcomes you can help them achieve. Suddenly the competition melts away. No more beauty parades, no more competing on fees.
• Patrick McLoughlin, Accounting for Growth Limited
This article is taken from “Accounting Practice” the ICPA quarterly magazine. Dedicated to supporting and promoting the needs of the general practitioner. You can find us at www.icpa.org.uk or email [email protected] or by phone on 0800-074-2896.