My Favorite 7 Ways To Make Every Client Worth More

Brian Hood (0:00)

This is the 6 Figure Creative Podcast, episode 335

Welcome to the 6 Figure Creative Podcast, where our mission is to help you turn your creative passions into a stable, reliable income. If you're in audio, video, design, photography, or really any other creative field, and you just want to learn from other successful creatives, you're in the right place. How much is one client worth to you over the lifetime that you work with that client? Is it low, is it high, do you even know, do you even track this stuff? Well, in this episode, I want to break down 7 different ways to increase the value of a client to you. One of these 7 things alone could give you a $25,000 per year raise by itself. So imagine actually implementing all 7 of these. When it comes to client value, many freelancers don't even track this. You don't even know what a client's worth to you. Over a year, over a lifetime, even for a single project, you don't even track the average project value. And even if you did, a lot of times the numbers are really low. And when those projects are low, then clients are simply just worth less to you than they could be. Now, hopefully after the episode we had a few weeks ago where I talked about 6 must-track metrics for freelancers, now you're actually starting to track the metric of client value, which is really important. But if you do obvious math, it's plain to see that if you have a lower client value, you are simply earning less than you could compared to someone with a high client value. So let's just do a really quick math comparison, really quick, super simple math. Don't tune out here. If you had 10 clients and they're worth $5,000 each, you made $50,000. If you have 10 clients, same 10 clients, and they're worth $10,000 each, you made $100,000. Same amount of clients, typically same amount of work, double the amount of money, because the variable changed of client value. Client value is a huge determining factor of how successful your business is. And many, many times, you can increase client value by 25%, 50%, 100%, double it, without even increasing the workload that you have to do on your end. Simply by following one of these seven things, a lot of times we can double or more how much one client is worth to you. And when we increase client value, doing any of these seven things that I'm going to talk about in this episode, that means that your clients are worth more, which means you make more. You can spend less time on client acquisition, because you won't need more clients, because those clients are worth more. And you can spend time doing the stuff you actually want to do. Many people listen to this show out of necessity. You want more clients. You need more clients. You're trying to grow, right? And so you spend a lot of time on client acquisition activities. Lead generation, lead nurture, you're working on sales, all these things are wonderful things to implement in your business, because most freelancers completely neglect those things.

Freelancers also neglect client value. And client value is one of the easiest levers to pull, where if you just increase that one metric, how much one client is worth to you, if you can just increase that one thing, all other things being equal, your income will start to increase, which means you're actually working the thing you want to do. Many people in our community that I talk to on a daily or weekly basis, if it's up to them, they're just sitting in their cave doing their creative thing. They're not marketing, they're not selling, they're just doing the creative thing all day long. That's all they want to do. And I resonate with that. You just want to be in creativity mode. And while that's not a hyper realistic way to look at your business, because at the point it becomes a business, there are now other operations that have opened up, responsibilities that have to get done as a business, that you have an obligation to do if you want to keep doing this for a living. And I will admit that not everyone is cut out for it. Many people do not have what it takes to run the business side of things. And they neglect the business side of things because they just want to be the creative, which is why I have the stupid sign behind me that says it takes more than passion that I've had here since pretty much day one of being in this place. But this episode, talking about client value, this is one of the easy ways to really increase your income without doing more of that business owner stuff. Some of these things may take a little bit of work, a little bit of effort, a little bit of ingenuity, maybe some bravery, but pretty much all of these can be done by you. So if this is your first time ever listening to this podcast, first of all, hello, glad to have you here. This podcast is for freelancers who offer creative services, who want to make more money from those services without selling your soul. That sounds like you, you're in the right spot. Before I get into the seven things here for this episode, I want to talk terms, basic terms that you should know. Client value equals how much is one client worth to you? Is it $100? Is it $1,000? Is it $10,000? Is it $50,000? $100,000? How much is one client worth? LTV, you know what that stands for? You're smart. Lifetime value. How much is one client worth to you over their lifetime or your lifetime, really? Whichever one ends first. If a client stops working with you, the lifetime of that client is over. If you stop working, the lifetime of that client is over. Either way, how much is a client worth over their lifetime? That's really hard to track because many times, no client is like, I'm never working with you again. A lot of times, they just kind of fade away or they stop needing your service or something shifts or they found someone better or someone they resonate with more or whatever. And so they kind of fade off into the sunset. So you never really know, is their client value done as far as LTV? Are they going to keep increasing it? I don't really know how to calculate that. And that's why this third metric is the one I like, it's the one I prefer. It's the one I talk about the most. It's AACV, average annual client value. It is just simply saying, how much is the average client worth to us over a 12 month span? And the easiest way to calculate this is just look at your income over the last 12 months, and then divide that by the total amount of clients who worked over the last 12 months. Super simple. And so we know one client is worth, on average, if he made $100,000, and we worked with five clients, we know on average, our clients are worth $20,000 each. Or if you worked with 100 clients, we know our average client's worth $1,000 each. So those are the three terms. I just gonna blanket call it just client value in this episode. I'm not gonna get into the specific nuance stuff here, but AACV is what I had in mind. Making each client worth more every year is kind of what I had in mind. Making your average client value go up. That's what I look for in a good healthy business. So let's get into this. Number one, the first way to increase your client value is to just get them to buy more of the thing you sold in the first place. I learned this from Alex Ramozzi. He says there's three phases that they look at when they're looking at implementing something new or selling products that their portfolio companies roll out, and that is more, better, new. First, sell them more of the thing that you sold them in the first place. Only then do you consider finding something better to sell them or improving on some big concept that you had. Only then do you do the better thing. The last resort is selling something brand new, a completely different service, a completely different offering, a different package, a different whatever. The reasoning for that is if you sell someone more of what they came to you for the first time, you're guaranteed that they want that thing. They came to it for one time. There's probably a way to sell some variation of that multiple times to a person. And when you look at your income over a year span, roughly 50 to 70 percent of a good healthy freelance business, 50 to 70 percent of that income should be coming from past clients. Clients that are coming back to you a second or a third or a fifth time, meaning they're buying more of the same thing that you sold them before. It could also be that they're buying other things that you could sell them, which we'll talk about later in this episode, but many times it's selling them the same thing you sold them before. And this was the case for my recording studio. Clients would come to me for music production. I would fulfill on what they paid me to do. Then clients would start promoting their music that we record at the studio. They would release their music, usually an album or an EP of some sort. And then they would start to tour off that music. So the album would come out, the label would be releasing it or promoting it. They'd be on tour as a headliner or a supporting act of some sort. They do three or four, maybe five tours in a year span. And then they start working on new music. And then they eventually start looking for their next producer, whether it's going to be me again or someone else. And the mistake many people make is in that client life cycle that happens, at least in my world, where they're going to come back every three to six to nine to 12 to 18 months, depending on several factors. The mistake people make is they're not top of mind when that decision starts to percolate in the client's mind of like, who are we going to go to next time? Are we going to go back to Brian? And so what I did is in my CRM, when I finished a project, I would set a date to fall by that person about the time that I thought they'd be starting to work on new music. And I've been in a band before, a touring band, we were on a label, we toured 300 days a year. So I understood that entire life cycle process because I was the client in that case. So I knew the timeline. If someone came to me to record a single, I knew when I should be reaching out to them for their next single or their next EP or whatever they're trying to do. If someone recorded an EP, which is 3, 5, 7 songs, I knew based on how many songs they recorded, how long it will be until they'll need to come back again. If they recorded an album, I generally knew how long it was going to be before they needed to come back to me again. So I'd always make sure I showed up in their inbox multiple times between now and that time. And most people just fail to follow up whatsoever. And I've said this before, I'll go to the grave saying this, if you are not top of mind, when it comes time for the decision to be made by your client, then you will never get the gig, even if you work on them before. If you're not top of mind, they found someone newer, sexier, better than you, right? Someone who's got all the hype around them. They forgot about little Brian. This studio was cool, he was cool, but like this newer producer, they've got three more releases out that we really love this year. You may still lose the gig, but I guarantee you if you're not top of mind, if they're not even thinking about you at that time, you're not gonna get the gig. So depending on your client life cycle, and obviously it has to make sense that they would ever need your service again, and if you're a wedding photographer listening to this podcast, there's probably better podcasts out there for you, but in this case, your client's not coming back to you again, right? Come after the divorce, this is gonna be a multi-year process, there's no way of telling, this is not the tactic for you, but in many cases, you can sell the same service, or a variation of the service again. It doesn't have to be the exact same thing, it can be a variation, a play on it. But understanding the time, the estimated time of when they will start thinking about it, which in my case is when this client, or when the band started working on new music, writing new songs, I wanted to be part of that discussion. I wanted to be part of like, how's the new songs coming along? Can I hear some of the demos? Show them to me. I'll check them out. I'll give you my thoughts if you want to hear them, that kind of stuff. That got me so many gigs. And it's such a basic thing to do, but many people don't do the basics. And there's a wonderful Alex Ramozzi quote, he uses it as a double negative. I understand it's a double negative, but it's catchier when you say it as a double negative. Successful people never don't do the basics. The smarter way of saying that is, successful people always do the basics. And this is one of the basics, and people still don't do that for some reason. Are you willing to send one or two or three emails or texts over the next 6 to 12 months to a client that you just worked with, that you liked working with, that you would want to work with again, in order to get their business again? Would you do that? Many people say yes, but then they won't do it. And it could be a failure of systems. You don't have a CRM with just basic reminders. You can't say, hey, Siri, set a reminder in 6 months to follow up with Flannel Landing, my favorite band.