The Christmas and New Year break is when I review my business activities, and assess how successful I have been during the previous 12 months. I think it has something to do with the New Year and everyone reflecting on the past year and making resolutions for the next one.
So if you haven’t done it yet, why not spend a couple of hours reviewing how you have done, and decide what changes you want to make in the coming 12 months?
Being a Virtual Assistant, just like any other business, is a numbers game. How many contacts you have made over the last year? Of these, how many have you turned in to prospects? And, how many clients you have secured as a result? You should also know the average value of your clients and their average lifetime value. These figures can tell you some really interesting things.
For example, if you know that over the previous 12 months you made:
- 300 contacts, of whom
- 100 became prospects (by showing a real interest in what you offer), which resulted in
- 15 new clients, each of whom spent an average
- £15,000 per year, and stayed with you for an average duration of
- two years
you will know that your clients have an average lifetime value of £30,000. And, to generate each client, you need to make 20 new contacts (15 clients from an original 300 contacts: 300/15). Suddenly, the prospect of attending a few networking events over the next couple of months to find 20 new contacts does not seem such a drag, as you know that, on average, you will make £30,000 for your efforts.
What you can also do is add up what you have spent on marketing, networking and other business-generating tools during the year. This will show the return on investment these have made. If you spent £2,000 on marketing your business and generated 15 new clients (with an average lifetime spend of £30,000), you know that that £2,000 has resulted in £450,000 worth of sales. That’s a return of £225 for every pound spent… Excellent! You can break that down further if you have monitored where these contacts learned of you. You can then identify exactly which marketing, networking and advertising methods have given the greatest returns.
When it comes to planning for the next year, armed with this information, you can invest more in your most effective marketing methods, and less on the less effective. So, if you spent £1,000 on a networking group, which achieved one client, but only £50 advertising in an online Virtual Assistant directory, which resulted in three new clients, it does not take a genius to work out that spending more on advertising in the directory might be a better idea than renewing the membership of the networking group.
Also, take a long hard look at your ‘sales funnel’ – the process that people go through from being contacts to becoming clients. What are your conversion rates from contact to prospect and from prospect to client? Where are you losing people? If you find that you have lots of contacts but few prospects, are your contacts fully aware of what you do? Are you tailoring your offering to appeal directly to these people? If you have lots of prospects, but they are not turning into clients, are you following up properly? Do you need to set up a better relationship-building system to develop their confidence in you? As you identify these gaps and plug them, you will need to spend less on generating contacts, as more of your existing ones will become clients… Happy days!
If you would like some 1 to 1 help from Justine with moving your business forwards, take a look at the mentoring calls available here