2022 is in the books and we’re already 1 month into 2023… Anyone else find that crazy? Time flies!
Last year, I wrote a popular blog post called “How to be a Great Coach in 2022”, where I advocated that coaches need to be more selfish. I pushed for coaches to take time for themselves to create healthier boundaries in their coaching relationships. Time and time again I’ve found that the coaches who don’t burn out HARD.
Since that blog was published, we’ve published over 60 blogs, covering topics like Long Term Development Programs, Digitizing Your Coaching, Best Practices of Video Analysis, among others.
We even launched the Level 2 ConnectedCoach Blueprint for PRO members to dive deeper into these concepts and help you leverage CoachNow to build the business of your dreams.
Coaches have been giving us positive feedback on the results they’ve achieved from taking our advice to heart.
For today’s post, I wanted to share what’s on my mind as we push into 2023. Using all the lessons I’ve learned from a career of High Performance coaching and 10+ years running CoachNow.
And when I think about the #1 way coaches can grow their business this year I keep coming back to one thing…
Compounding.
Might not have been the word you expected, but I think understanding the concept is crucial for meaningful growth in 2023 and beyond.
Compounding, in the context of your business, refers to the process of growing revenue by retaining and upselling your current customers. By doing this, you increase the lifetime value of your customers, which ultimately leads to more revenue and a healthy, sustainable business.
So today I’m gonna cover 3 Compounding is my word of the year in 2023. And I hope by the end of this post, you’ll see where I’m coming from.
Let’s get to it.
Last year, I wrote a popular blog post called “How to be a Great Coach in 2022”, where I advocated that coaches need to be more selfish. I pushed for coaches to take time for themselves to create healthier boundaries in their coaching relationships. Time and time again I’ve found that the coaches who don’t burn out HARD.
Since that blog was published, we’ve published over 60 blogs, covering topics like Long Term Development Programs, Digitizing Your Coaching, Best Practices of Video Analysis, among others.
We even launched the Level 2 ConnectedCoach Blueprint for PRO members to dive deeper into these concepts and help you leverage CoachNow to build the business of your dreams.
Coaches have been giving us positive feedback on the results they’ve achieved from taking our advice to heart.
For today’s post, I wanted to share what’s on my mind as we push into 2023. Using all the lessons I’ve learned from a career of High Performance coaching and 10+ years running CoachNow.
And when I think about the #1 way coaches can grow their business this year I keep coming back to one thing…
Compounding.
Might not have been the word you expected, but I think understanding the concept is crucial for meaningful growth in 2023 and beyond.
Compounding, in the context of your business, refers to the process of growing revenue by retaining and upselling your current customers. By doing this, you increase the lifetime value of your customers, which ultimately leads to more revenue and a healthy, sustainable business.
So today I’m gonna cover 3 Compounding is my word of the year in 2023. And I hope by the end of this post, you’ll see where I’m coming from.
Let’s get to it.
Strategy #1: Do Everything You Can to Retain Existing Customers
One major trend that I’ve seen from coaches and trainers is the tendency to focus on gathering new leads and customers, without fully leveraging the gold mines that they already possess.
But here’s the deal: it’s actually 10 times more expensive to acquire new customers than it is to retain your existing customers.
And in most businesses existing customers generate between 67% and 87% percent of total revenue.
In 2023, I want you to think of your customers as lifetime customers instead of going after a bunch of one-time sales or selling one-time lessons.
What can you do to make sure they are seeing the results they crave? How can you improve your communication with them? What additional perks or bonuses can you surprise and delight them with?
This strategy is really nothing more than a mindset shift. Do whatever you can to over deliver and keep your existing customers happy and raving about you.
In the long run, your business will thank you for it.
One major trend that I’ve seen from coaches and trainers is the tendency to focus on gathering new leads and customers, without fully leveraging the gold mines that they already possess.
But here’s the deal: it’s actually 10 times more expensive to acquire new customers than it is to retain your existing customers.
And in most businesses existing customers generate between 67% and 87% percent of total revenue.
In 2023, I want you to think of your customers as lifetime customers instead of going after a bunch of one-time sales or selling one-time lessons.
What can you do to make sure they are seeing the results they crave? How can you improve your communication with them? What additional perks or bonuses can you surprise and delight them with?
This strategy is really nothing more than a mindset shift. Do whatever you can to over deliver and keep your existing customers happy and raving about you.
In the long run, your business will thank you for it.
Strategy #2: Increase your Average Value Per Customer
The second strategy builds upon the first, by focusing on making your happy customers even more valuable.
This can be achieved by upselling them to a new product offering or a tiered pricing model, or cross-selling complementary products.
For example, if you offer coaching services, you can also offer digital education products or partner with other companies to offer deals on complementary products.
By doing this, you increase the lifetime value of your customers, leading to even more revenue.
In full transparency, this was a huge part of our business strategy in 2022. We launched CoachNow PRO as a way to over deliver to our existing customers and make them more valuable to us at the same time.
We had a HUGE percentage of CoachNow+ members gladly upgrading because they know that the additional money they are spending translates to additional value.
And in return they are more than willing to send more money our way as we grow.
We really do practice what we preach!
The second strategy builds upon the first, by focusing on making your happy customers even more valuable.
This can be achieved by upselling them to a new product offering or a tiered pricing model, or cross-selling complementary products.
For example, if you offer coaching services, you can also offer digital education products or partner with other companies to offer deals on complementary products.
By doing this, you increase the lifetime value of your customers, leading to even more revenue.
In full transparency, this was a huge part of our business strategy in 2022. We launched CoachNow PRO as a way to over deliver to our existing customers and make them more valuable to us at the same time.
We had a HUGE percentage of CoachNow+ members gladly upgrading because they know that the additional money they are spending translates to additional value.
And in return they are more than willing to send more money our way as we grow.
We really do practice what we preach!
Strategy #3: Understand and Optimize Net Retained Revenue (NRR)
The third strategy is to focus on the metric of Net Retained Revenue (NRR).
This metric helps you understand the health of your business, by measuring how well you retain your customers and increase the value of their engagement with your business.
The formula for NRR is simple:
MRR (monthly recurring revenue) + expansion revenue - downgrades or churn.
This metric is commonly used for software-as-a-service companies, but can also be applied to coaching businesses, especially those that offer annual or monthly plans (as we recommend doing in our educational offerings).
I don’t wanna overwhelm you here in the post, but if you want more details on calculating NRR for your business, I cover an example in the video above at XX:XX.
If you do the calculation and end up with >100% NRR, that means you’ve covered your churn with new revenue. To me, this is the best metric for knowing the health of your business.
And, based on this number, you have a really good sense of what you can forecast in the future. Happy customers have big mouths and will bring you new happy customers.
Then you just gotta get the automation and systems in place to upsell those customers and get that NRR as high as it can go.
The third strategy is to focus on the metric of Net Retained Revenue (NRR).
This metric helps you understand the health of your business, by measuring how well you retain your customers and increase the value of their engagement with your business.
The formula for NRR is simple:
MRR (monthly recurring revenue) + expansion revenue - downgrades or churn.
This metric is commonly used for software-as-a-service companies, but can also be applied to coaching businesses, especially those that offer annual or monthly plans (as we recommend doing in our educational offerings).
I don’t wanna overwhelm you here in the post, but if you want more details on calculating NRR for your business, I cover an example in the video above at XX:XX.
If you do the calculation and end up with >100% NRR, that means you’ve covered your churn with new revenue. To me, this is the best metric for knowing the health of your business.
And, based on this number, you have a really good sense of what you can forecast in the future. Happy customers have big mouths and will bring you new happy customers.
Then you just gotta get the automation and systems in place to upsell those customers and get that NRR as high as it can go.
Understanding and implementing these three strategies will set you on a great path to knock 2023 out of the park.
Focus on retention, increase the value of your customers, and think of NRR as the most important metric for the health of your business.
After reading this post, you might be thinking to yourself: that all sounds great, but how the heck am I going to deliver the value I'm promising in my coaching?
Of course, here I’m gonna advocate for you to leverage CoachNow. You gotta leverage technology to see the growth that you deserve in 2023.
Say no to disparate communications between email, text, etc. Consolidate everything you’re doing so you can increase the touch points and deliver crazy value in less time.
You’ve heard me say it a million times: our goal here at CoachNow is to help you save time, increase your income, and coach how and where you want. You owe it to yourself to avoid the burnout that plagues the coaching industry, and CoachNow is a crucial step to ensure you stay at your best.
If you're not a member of coach now kick off your free trial over at coachnow.io.
If you’re already a member, reach out to us! We're here to help you maximize the opportunities within the platform. And there's also a ton of education that we have created and we will continue to create in this blog and other places.
We've got tons of stuff coming in 2023. And I want to make sure you take advantage of not only all the education, but all of the product updates that will make your life easier.
Cheers to a booming business in 2023!
Focus on retention, increase the value of your customers, and think of NRR as the most important metric for the health of your business.
After reading this post, you might be thinking to yourself: that all sounds great, but how the heck am I going to deliver the value I'm promising in my coaching?
Of course, here I’m gonna advocate for you to leverage CoachNow. You gotta leverage technology to see the growth that you deserve in 2023.
Say no to disparate communications between email, text, etc. Consolidate everything you’re doing so you can increase the touch points and deliver crazy value in less time.
You’ve heard me say it a million times: our goal here at CoachNow is to help you save time, increase your income, and coach how and where you want. You owe it to yourself to avoid the burnout that plagues the coaching industry, and CoachNow is a crucial step to ensure you stay at your best.
If you're not a member of coach now kick off your free trial over at coachnow.io.
If you’re already a member, reach out to us! We're here to help you maximize the opportunities within the platform. And there's also a ton of education that we have created and we will continue to create in this blog and other places.
We've got tons of stuff coming in 2023. And I want to make sure you take advantage of not only all the education, but all of the product updates that will make your life easier.
Cheers to a booming business in 2023!