March 31, 2021 Invoicing en_US This guide outlines several key ways to successfully maintain great client relationships. Learn about the benefits of good client relationship management and how to successfully practice client relationship management in your business. https://quickbooks.intuit.com/cas/dam/IMAGE/A41nITy5u/client-relationship-management-feature-us.jpg https://quickbooks.intuit.com/r/invoicing/relationship-management/ 6 keys to successful client relationship management
Invoicing

6 keys to successful client relationship management

By Kat Boogaard March 31, 2021

Here’s the truth: Without your clients, you don’t have a viable business. Landing new customers and retaining your existing ones is key for managing your cash flow and growing your business.

But, as a busy business owner, you know that tending to your client relationships can quickly slide down (or even off) your list of priorities.

Between leading a team, negotiating with vendors, planning for the future, and juggling a dozen other important and time-pressing responsibilities, your business relationships and customer interactions aren’t always top of mind.

Yet, high-quality customer service is something that people not only appreciate from a small business, but expect. A survey from Salesforce found that three of the top five reasons people support small businesses have to do with the level of service they receive:

  • There was consistently excellent customer service.
  • The small business offered a more personal experience.
  • The business and its employees understand a customer’s needs or interests.

Needless to say, small business owners need to prioritize relationships if they want to improve the customer experience, ensure customer satisfaction, and boost customer loyalty and retention.

Wondering how to make that happen (especially when your plate is already full)? Here’s your guide to acing client relationship management without a ton of hassles and headaches.

Keep reading to learn more, or use these links to navigate to another section in the guide:

What is client relationship management?

Client relationship management is the process a business uses to streamline, personalize, and improve their interactions with their customers. Think of it as a systematic approach to keep strong, positive bonds with your clients.

Doing this effectively requires that a business keeps track of different data about their customers, including:

  • Demographic information: Name, contact information, etc.
  • History: How long they’ve been a customer, past purchases, etc.
  • Status: Whether they’re a repeat customer, a recurring customer on a payment plan, a one-time purchaser, a prospective client, etc.
  • Interactions: Messages, phone calls, in-person discussions, etc.

Think that’s a lot to keep track of? You aren’t wrong. Ideally, every single conversation or touchpoint you have with a customer—whether it’s sending a holiday card or delivering a proposal—will be logged so that you can ensure you don’t repeat messages and you deliver personalized service and targeted marketing campaigns.

There’s no way to keep all of this customer data in your head, and that’s where technology comes in.

Many businesses large and small opt to use a customer relationship management (CRM) platform, which is a piece of software that not only tracks all of this important information, but can also automate important actions like sending a follow-up email, as just one example.

Plenty of CRMs are available, but some of the most popular are:

All of those integrate with QuickBooks, so all of your business record-keeping happens in one, easy-to-reference spot.

Why is client relationship management important?

Strong bonds with your clients and customers can’t be a bad thing, right? That’s true. But, let’s dig a little deeper into some of the specific reasons that business owners should prioritize relationship management.

1. It increases sales

With effective CRM tools and practices in place, you’re equipped with more information about existing and potential customers.

You can get a better grasp on customer needs, understand where prospective buyers are in your sales process, and use that data to touch base with them in a highly targeted, impactful way that hopefully converts them to paying customers.

Data from Salesforce reports that businesses that use their CRM solution have improved lead conversion by anywhere from 24% to 30%.

2. It improves retention

While you want to win new customers, you also want to keep your existing ones happy—especially when even a modest increase in your retention rate can have a huge, positive impact on your bottom line.

The more you understand about your current customers, the more you’re able to deliver high-quality customer service and a top-notch customer experience that encourages people to stick with your business.

3. It boosts your reputation

Providing excellent customer service is important—not only because it keeps your existing clients happy, but also because it helps you maintain a positive reputation.

In 2020, a whopping 87% of consumers said they read online reviews for local businesses. Understandably, you want those reviews to be positive.

When you implement effective relationship management tactics, you’re far more likely to delight your customers and receive positive reviews of your business—or, at the very least, prevent the really scathing ones. Plus, when customers have a positive experience, they’ll be more likely to provide referrals and recommendations.

4. It streamlines your systems

Maybe you have a sales team working within your business. They attend networking events and trade shows, conduct research, and even pitch your business to relevant prospective customers. Or maybe you have a smaller staff where everybody chips in with customer recruitment and retention.

Now, what happens if one of your salespeople or team members leaves? Without a CRM solution or at least some form of record-keeping, it’s going to be next to impossible for somebody else to pick up where they left off.

How will they know who they were interacting with? What conversations they had? What products or services have already been pitched?

When you prioritize effective CRM—both the practices and the CRM system itself—you streamline your processes, ensure consistent workflows and contact management, and make it that much easier to track and act on customer information regardless of who’s handling it.

5. It gets you paid faster

You want your invoices paid on time—or maybe even early. And while you deserve prompt and fair payment for work you’ve delivered regardless, prioritizing your client relationships could be the secret sauce for getting paid faster.

Think about it this way: Relationships are a two-way street. The more you value your customers, the more they’ll value you (and hopefully issue fast payment as a result).

Beyond that human aspect, using a CRM solution will have functionality to help you automate tasks like invoicing, follow-ups, and payment reminders so you can get the money you deserve without all of the added legwork.

Understanding what your customers need

When it comes to maintaining strong relationships with your clients and customers, it can be tough to pin down exactly what they want from you. Their specific needs will vary depending on the industry, business, or even the specific customer.

But, speaking generally, there are a few things that most customers expect from their interactions and relationships with a small business:

  • Satisfied expectations: There aren’t any relationship management tactics that will replace meeting (or even exceeding) your customers’ expectations. You need to follow through on your promises and deliver work that you’re proud of. That foundation needs to be in place before you’ll see any payoff from other strategies.
  • Helpful customer support: When working with a small business, customers expect a certain level of personalization and direct interaction. The anonymity of automated phone menus or huge call centers might fly with larger companies, but as a small business owner, you need to be prepared to deliver reliable and straightforward customer support.
  • Transparency and honesty: 95% of customers say they are more likely to be loyal to a small business they trust, but how can you instill that confidence? It all starts with honest and proactive communication—even when things get hard. If you need to raise your prices or hit a delay, that should be explained to your customers early and upfront. Trying to sweep things under the rug will destroy trust and ultimately damage your business relationships.
  • Opportunities to provide input: A relationship isn’t one-sided, which means you can’t always be broadcasting sales messages at your customers without ever listening to their insights and opinions. Provide opportunities for them to leave reviews, and regularly solicit their feedback about everything from your customer service to what new products you should offer. When 42% of companies don’t collect any customer feedback at all, that attention to their needs and input will already put you ahead of the curve.

That’s by no means a comprehensive list of customer needs, and the basics like your prices and products still carry a lot of weight. But keeping those four basic elements in mind will pave the way for mutually beneficial client relationships.

How to maintain good relationships with clients

Wondering how to prioritize CRM and maintain strong bonds with the people who pay for your products and services? Here are six strategies.

1. Align your expectations

To start, you and your clients need to be on the same page about what a continued business relationship will look like. These shared ground rules are particularly important for businesses that have recurring or repeat customers.

This requires that you be explicit about your typical workflows and processes. New customers should be equipped with answers to questions like:

  • What is the price of the product or service they’re paying for?
  • Are there additional fees or hidden costs they should be aware of?
  • How often will they be billed (if they’re receiving a recurring charge)?
  • What’s the timeline for receiving your product or service (if it’s not immediate)?
  • How often will they hear from you?
  • How should they get in touch if they have questions or concerns?

While it can feel like overkill to cover all of these bases with your customers, ensuring this mutual understanding is what lays the groundwork for a strong and long-lasting relationship.

2. Maintain open lines of communication

When it comes to customer service, speed matters. A recent survey found that 88% of customers want a business to respond to them within an hour. That can be a hard goal for a small business to meet—especially if they have limited resources and team members.

However, this doesn’t mean that your clients need to feel unheard or ignored. Even if you can’t guarantee an almost-immediate response, there are some tips to help you keep open lines of communication with your customers, such as:

  • Establishing days and times when you’re available and easily reached, almost like “office hours” for your customers
  • Setting up an email autoresponder that tells them when they can expect a response (e.g., “Someone from our team will get back to you within 24 hours”)
  • Including an email address on the contact page of your website instead of a form, as more than 67% of people will opt for the email address when given the choice

And of course, here’s the biggest communication key for client relationship management: actually respond to your customers. Every single message from a client should receive a response. Unfortunately, 62% of companies don’t respond to customer service emails, which damages trust and customer engagement.

3. Underpromise and overdeliver

It’s tempting to make lofty promises and ambitious guarantees to attract new clients or appease your existing ones—particularly if you’re trying to patch up a mistake. But, making a promise you can’t keep will ultimately sabotage your business relationships.

You’re far better off making a pledge that you know you can fulfill, and then exceeding expectations by going above and beyond.

How can you avoid overpromising? A lot of it requires that you trust your gut and keep yourself in check, but here are a few strategies to ensure your commitments are grounded in realism:

  • Stay zoned in on your core products or services, as opposed to fulfilling any client requests that come your way.
  • Be wary of words that seem firm and salesy, like “guarantee,” “always,” “definitely,” and “without a doubt.”
  • When setting a deadline, add a buffer to protect against any unforeseen circumstances.

You’d much rather exceed your client’s expectations than fall short of them, and that’s impossible to do if you’re making overly ambitious promises in the first place.

4. Provide additional value

Clients and customers want what they paid for—that’s the bare minimum. But to keep your relationship running strong, it’s helpful to provide additional value outside of what they get for their money.

Rest assured, this doesn’t need to be anything overly complicated or burdensome on your end. You could write a monthly newsletter that offers helpful industry tips or insights. Or you could send a thoughtful, hand-written card celebrating a milestone like their birthday or their anniversary with your business.

These seemingly small actions go beyond the agreed-upon requirements of your business relationship and prove that you’re invested and engaged in them.

5. Emphasize consistency

Relationships take work and consistency. Popping up in their inbox once every year with a random marketing campaign or message isn’t enough to keep a relationship going—and, even worse, it likely won’t be opened.

Making client relationship management a priority means it’s something you need to be working at constantly and not just when you think of it or have the time. There are a number of different ways you can practice consistency, including:

  • Start a regular marketing newsletter to share helpful information and stay top of mind.
  • Set a regular appointment on your calendar to check in with past, current, and potential clients.
  • Dedicate time every day for you or a team member to respond to all customer service inquiries.

Consistency can be a fine line to walk. You want to be present, but you also don’t want to be a pest. How often you should check in with your clients will depend on a variety of factors like your existing relationship and the type of service or product you provide.

You’ll have to make a judgement call, but a good rule of thumb is to touch base at least once per quarter, but not more than once per month.

6. Keep detailed customer records

Consistent and thoughtful communication will be a lot easier if you maintain detailed records about your interactions. You’ll know exactly when you checked in last, what you said, and what you should follow up on.

If you haven’t already implemented CRM software for your business, it’s one of the best steps you can take for maintaining strong client relationships. It’s where you’ll store all of your notes about customer interactions and other important details.

This information makes it easier to determine an appropriate time to follow up or check in, and also makes you aware of past complaints, questions, or conversations so you don’t confuse your customer with redundant or even contradictory information.

Most CRMs also offer templates for common conversations that you can personalize as well as automations for certain tasks and messages. Those make your customer communication cohesive and also save you time.

Client relationship management best practices

Those are the pillars of effective client relationship management. But, if you’re looking to level-up your customer experience even further, here are a few more nitty gritty tips to help.

  • Don’t rely solely on email: Email dominates a lot of our business communication, but it’s not the only method that deserves your attention. Phone calls, text messages, live chats, and social media are important too. Forrester predicts that digital customer service interactions will increase by 40% in 2021.
  • Get a little personal: Most of your client interactions will revolve around business matters, but keep in mind that humans like to do business with other humans. Some friendly small talk with your customers—whether it’s about their families, hobbies, or something else—can solidify your bond.
  • Show appreciation: Your customers are the ones who keep your lights on, and that’s worth some genuine appreciation. Find some small ways that you can make them feel valued, like a little gift at the holidays or a modest discount for repeat services.>
  • Act on feedback: Listening to your customers is important, but it doesn’t mean anything if you never put their feedback into play. Act on the input that you find valuable, thank your customers for their suggestions, and share how you’ve used their insights to make changes.

How to measure the effectiveness of your client relationship management

It’s challenging to pin down a return on investment for your relationship management efforts, and it can take some time to start seeing some payoff.

There isn’t one surefire way to measure your effectiveness, but it’s helpful to look for an increase in your:

  • Customer retention
  • Lead conversions
  • Upsells or cross-sells
  • Customer referrals
  • Positive reviews and feedback
  • Net Promoter Score

All of those can indicate that your customers feel well cared for, and that the time and energy you invest into your relationships are making a positive difference.

Client relationship management can’t be an afterthought

You have a lot on your plate as a business owner, but maintaining and managing relationships with your clients and customers deserves your attention.

When you prioritize effective relationship management, you foster a positive business reputation, boost customer retention, and elevate your customer experience—all of which can lead to increased sales and faster payments.

Business is about relationships, and those bonds don’t just happen. They take time, effort, patience, and a little bit of strategy.


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Relationship Management Strategy #2: Develop a Personal Relationship

It should go without saying, but people like doing business with people they enjoy spending time with – so find some shared interests.

Whether you’re both currently training for your first half marathon or you can commiserate over the challenges of staying home with a sick kid, giving your clients and customers a peek at who you are as a person—and not just a business owner—will solidify that bond.

While the goal of relationship management is to get paid faster and retain your customer, a more satisfying side-effect is forming a bond that transcends the typical client/vendor relationship and evolves into a friendship that extends long after the contract is over.

Action Item:

  • Set aside time in each interaction to learn about your client personally.
  • Randomly follow up on shared interests.

Relationship Management Strategy #3. Follow Up Consistently and Frequently.

How well can you build a meaningful relationship in one hour, once a month?

Consistent, frequent, meaningful contact over multiple channels – email, instant messenger, text or phone – demonstrate that you’re not just in it for the paycheck.

Even if you don’t have something to deliver at a specific point in time, use the time to check in with a brief update, pass along an article, or talk briefly about a shared interest.

Gaps happen and goals aren’t always met on-time, However, don’t set the precident that it is acceptable to go weeks without communication or results. If that’s ok with you, your client has every right to assume it’s ok for them—regardless of the payment terms.

Action Item:

  • Make a point to minimize large gaps in communication
  • Schedule a regular meeting and establish check-in frequency from the outset of the relationship.

Relationship Management Strategy #4: Be Gracious and Thoughtful in Your Automated Interactions

If you’ve been working with a client for a while, or have been sending your invoices automatically, it’s easy to forget how much language counts.

An often forgotten element of relationship management is auditing all of your automated communications.

Even if all of your email interactions and regular phone conversations are friendly, curt default messages saying “Payment is due within 30 days” or “Thanks for being a customer!” can feel inconsistent and off-putting.

Take the time to evaluate all of your default messaging and inject more of your personality into it, so it doesn’t feel like a robotic exchange of goods and services for money.

Action Item:

  • Consider how you would respond were the transaction taking place in person and with cash
  • Evaluate your existing automated messaging and figure out how you can make it a little more human.

Relationship Management Strategy #5. Remember Birthdays, Holidays, and Milestones

It never hurts to express gratitude by sending something special for a client’s birthday, during the holidays, or after a major milestone.

Gifts should be tailored to their personal interests, but maintain a level of professionalism. In this list of client gift ideas on CNBC for example, there are personalized pen sets, stylish wine sets, terrariums, and more.

If your client has a gift policy that prohibits receiving gifts, a card with a thoughtful message works just as well.

Action Item:

  • Mark important dates and milestones in your calendar so you remember to recognize those with a gift or note.
  • Select tasteful gifts that reflect their personality in a thoughtful way

It’s Time to Collect What You’ve Earned

You don’t want your invoices to collect dust—nobody can blame you. However, while managing your client relationships will improve your chances of getting paid on time, there’s so much more to it than that.

Making relationships a priority will improve your reputation, increase referrals and recommendations.

Yes, getting what you’re owed is a definite perk. But, gaining a new sense of connection and friendship with the people your business serves? Well, it’s tough to put a price on that.

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Kat Boogaard is a freelance writer specializing in career, self-development, and entrepreneurship topics. Her work has been published by outlets including Forbes, Fast Company, Business Insider, TIME, Inc., Mashable, and The Muse. Read more