At the end of ’22 I had a sobering few months. A few of my recurring revenue clients ended their subscriptions almost at exactly the same moment as each other. I’d not landed a new client for some time and more worryingly, the cost for acquisition was rising and rising as leads needed more persuasion, more questions answered, more reassurance. Interest rates were rising, end of year spend seemed targetted elsewhere and I chewed nervously at my lip.
I had new work coming in, as clients needed tasks prior to year end, but the ease of closing sales and getting new clients started, onboarded, on their way, that I’d known for much of my business life seemed as firm as partially set jelly.
As a book keeper, I’ve always been a great procrastinator. However, I am proud of ‘knowing my numbers’ and of being a fully immersed member of the Mike Michalowicz, Profit First fan club. (allocate all money, in clearly defined percentages, to 4 funds: Owners Pay; Expenses; Tax and Profit)
Knowing my numbers, for me, has been a simple mathematical equation of knowing what I need to earn annually to live in the way I want to, pay into super, pay my team, my costs, my tax, take a salary and make a profit.
Broken down, I know the monthly income I need, my service rate and the billable hours and recurring revenue I need.
Know what works, and when
I thought I had a fairly comfortable fall back until the last quarter on ’22, when things slowed. Having been in business for some years, I know this is traditionally not the time to win new work, it’s the time to reach out with your value and expertise to clients who know and trust you, to help them reduce the stress of their end of year, while reducing my own.
This is all a part of ‘knowing your numbers’ : knowing the cost of acquisition and, where is income more easily obtained.
Know where the sales are easiest.
As I mentioned earlier, trying to close sales for new projects with new clients was tricky at best as we crashed toward the end of ’22. By asking current clients how best I could help ease their stress, and giving suggestions on tasks that were best managed before year end, I was able to both help clients and improve my cash flow.
The matrix below shows cost of acquisition:
- New Product to New Clients is the most costly and difficult: you’re going into unproven territory with an unproven product. Ease the process with proof of product:
- written and video testimonials that prove how you’ve solved problems
- video stepthroughs
- blog posts
- social media content
- New Product to Existing clients: this is easier, but still has difficulty. You’re offering a new product, to clients who know like and trust you. You’re still in unchartered territory with a new product, so the sell is likely to take longer, but you’ve got history with existing clients, whose problems you know. The buying cycle should be shortened.
- Existing product to New clients: until you establish trust with new clients, you’ve got hard work to do. Demonstrate proof of problem solving using the list above
- The perfect blend: existing products, to existing clients. More of what your clients love + more of what you excel in = ease of delivery, ease of sale, and a quick trip to customer satisfaction. An even better result comes from signing up existing clients to a retainer or subscription to ensure they’re regularly taken care of and you can rely on meeting your numbers.
The 80-20 rule
The decision to transition into running your own Personal Branded business is more complex than knowing your numbers, of course. It’s knowing your clients, knowing your services, knowing your unique value, messaging and the solutions you deliver.
The matrix above helps understand where your time and resources should be managed.
A common rule of thumb is the 80-20 principle: 80 percent of results are generated by 20 percent of effort. Building a trusted clientelle, to whom you deliver your proven solution gives you a solid foundation.
Know your numbers, of course, but also know the cost of acquisition and ensure you have a good percentage of low risk, low effort, well processed, repeatable services in your arsenal.
BUILD YOUR BRAND.
BUILD YOUR AUDIENCE.
I can help even the most introverted build a Personal Brand.
From targeted website help to a brand visibility audit, from a new site build, to my full Personal Brand pathway, I’ll get you online and on your way.