What is Client Health?
Client health involves using data and feedback to better understand how your clients experience your services, so that you can ensure you and the team are fulfilling upon your clients’ needs and the experience you are wanting to create for them. In addition, it helps predict client satisfaction, engagement, and the likelihood of churn, offering insight into both business risks and opportunities. Monitoring client health ensures you are building strong relationships and supports the long-term sustainability of your business.
What is the Client Feedback Loop?
The client feedback loop is the process of collecting feedback, analyzing it for trends and opportunities, taking action based on the insights, and communicating those actions back to your clients. The goal is to continuously improve the client experience and address potential issues proactively.
There are numerous ways you can collect feedback and communicate your actions back to them. What is important here is that you intentionally create the space and opportunity to do so and then make use of the information and data you receive.
Purpose
The purpose of assessing client health and regularly requesting feedback from your clients is so that you can improve their overall experience, reduce risk, and find the opportunities for expansion. While we can move forward in our business and our client relationships by operating under the assumption we are doing really well, having the direct feedback of our clients provides more accurate information and creates the space for reflection before movement.
Metrics & Tools
1. Net Promoter Score(NPS):
Measures client loyalty by asking how likely they are to recommend your business to others. A simple survey (quarterly or bi-annual) with a 1-5 rating or visual cues (like smiley faces) can gauge client sentiment. In an effort to build true client advocates, this score can be an invaluable tool to check if you and your team are effective.
2. Customer Satisfaction Score (CSAT):
Tracks client satisfaction with specific products or services through short surveys, providing insight into the client’s experience with a specific part of your business.
3. Customer Effort Score (CES):
Measures how easy it is for clients to resolve issues with your company. It can be included in surveys alongside NPS to assess client perception of your service.
4. Renewal, Retention and Churn Rates:
These metrics track the duration of time clients continue using your services and how many left in a certain time period. They can also be segmented by factors like client type, length of service, or product used to provide even more valuable insights.
5. Voice of the customer/Client Feedback (VoC):
Collecting direct client feedback helps identify trends and allows for proactive problem-solving. This feedback can be gathered through periodic reviews or emails.
I like to use the periodic reviews (link blog here when available) as a time to both review the CSP and request the client’s feedback on how they have experienced our performance. I intentionally will not address scope alignment issues unless the client directly requests an expansion of services. This is a time to focus specifically on the client’s new objectives and their experience. I will also send an email request a few times throughout the year. While I don’t want to flood their inbox, sometimes clients feel more comfortable talking only to me directly and/or doing it in writing. I consider this feedback invaluable when it comes to building an intentional client experience and relationship.
6. Lifetime Client Value (LTV):
LTV measures the total revenue expected from a client throughout their relationship with you. It can inform product development, marketing investments, and customer acquisition strategies.
How to Use Client Health Scores & the Feedback Loop
Regularly gathering feedback and comparing client health scores over time gives you clear insight into whether your business is meeting its intended goals. Use the data to identify trends, resolve unknown issues, and adjust your approach. When asking for feedback, ensure you are prepared to act on it, as failing to address concerns is worse than not asking at all. It is also important to ask clarifying questions from those clients that are willing to answer, as it can give you more insight into their response and the actions you need to take.
Once you have client feedback, look for common themes, take action to address any issues, and inform the client about the steps you’re taking. This reinforces their trust and strengthens the relationship.
Finally, make sure to clearly communicate the findings to your team and any shifts in direction that are needed. Get their input and feedback on what the client shared and then co-create the next steps and path forward to ensure that you are back on the path creating an intentional client experience. If the experience and feedback shared was positive, make sure to celebrate those wins with your team.
Financial Focus and Key Metrics
Client health scores tell the story of your business’s performance, which directly impacts churn, retention, and expansion – influencing your overall revenue and profitability. Many decisions about future investments can be derived from the stories this information tells if you monitor and make use of it.
Beyond the Numbers
As the business owner, your responsibility is to create an engaging client relationship and work environment. You should understand the risks and be looking for opportunities to expand and grow. This creates excitement and stability for your team and your true client advocates. Getting access to the data and client feedback is an integral part of being able to build this in your business.
In addition, it’s often not the mistakes and issues that arise while we are servicing our clients that create the issues and questions of value. Rather, it is the lack of knowledge, experience of being heard and lack of action taken that creates a divide. Assessing the health of your client relationships and directly asking for feedback, then taking action and letting them know the response can often strengthen your relationship as they now experience you as willing to listen and take action.
By tracking client health and acting on feedback, you ensure continuous improvement and growth for your business, benefiting you, your clients and your team.