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How Much is Your Client Worth to You in Total?

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TLV-client-graphic How Much is Your Client Worth to You in Total? Business Tips Guest Bloggers

How much is your client worth to you? They may be worth more than you think.

If I sent you 2 clients and told you one was worth $400, and the other was worth $4000, which would you take the best care of?   I hope you answered “both”.  I was actually referring to the same client in both scenarios. The first scenario was your client the first time they had a session with you, and the second is the same client years down the road. The $4000 reflects what your client is worth over a lifetime with you!

When many people think of their client’s potential, they think of what they will be paying for their one session. This can be a huge mistake! Your client needs to be evaluated with their “Total Life Value”. What is the Total Life Value? It’s the value your client will bring to your business over a total lifetime. It’s not just this shoot, but it’s adding up every shoot, every product, and every pack of Christmas cards they buy from you over a lifetime. And don’t forget the value of every referral they send your way over the years.

So if I told you that each of your clients is worth $4000, would you treat them any differently? I hope so. How you treat your clients will help determine how long they will stay with you over the next 10+ years, how much they spend with you and how many referrals they send your way.

Here is a simple equation to figure out the lifetime value of your clients:

(Average Value of a Sale) X (Number of Repeat Transactions) X (Average Retention Time in Months or Years for a Typical Customer) =  Total Lifetime Value

An easy example would be the lifetime value of a gym member who spends $20 every month for 5 years. The value of that customer would be:
$20 X 12 months X 5 years = $1200 in total revenue

TLV = $1200

Here is a sample photography client:

$400 x once a year x 10 years = $4000

Add in 4 solid referrals with the same average = $16,000

Total Lifetime Value = $20,000

Are you starting to see how important it is to treat each client? So many times, photographers are looking for new clients and new business. But if you want to build a strong solid business, then your goal should be to take each of your customers and keep them in your hip pockets. Treat them like you are best friends and that they are your number one client above everyone else. Don’t just allow them to have their one experience with you and then go looking for the next 10 people to replace them. If you treat them right and stay in front of them, they will stay with you and bring you the next 10 people.

Here are a couple of quick ideas on how to roll out the red carpet for each of your clients.

  • Create the best images.
  • Make them feel like they are number one.
  • Surprise and delight them with excellent service.
  • Stay in touch through the year using newsletters, Christmas cards, etc.
  • Use your imagination and you can make your client’s experience one worth talking about!

 

Amy Fraughton is the owner of Photo Business Tools, a website committed to helping you learn the in’s and out’s of running a photography business.  As a professional photographer herself, she enjoys shooting families the most.   Amy just welcomed baby number 6 into their home.  While she loves everything about business, she also loves the flexibility that being her own boss gives so that she can be there for her family too.  You can also find her on Facebook.

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  1. Chris on October 20, 2014 at 3:36 pm

    The problem I find is that many cheap clients, not all but most, are poor referrers and often not repeat buyers. This is despite putting our best foot forward with both small paying clients and big buy clients. While it is very good strategy to treat everyone very well, it is a better strategy to treat your best customers a little bit better.

  2. Ava H on October 21, 2014 at 12:12 am

    Professional photographers on the whole have to embrace the service provider aspect of their business as much as the artist.The art is what draws us to this work, but it’s the service provider that keeps it going.Not all clients are easy, and it’s hard not to write a snarky response to an off-the wall ask. Yet, thinking about “how would I like someone to respond to ME if I was the one asking this question” is how I approach clients. It works for me and I feel pretty good about how my clients feel about me.

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