The Bright Side Of Losing A Customer
We all lose customers from time to time, but what we can we learn from it?
So you've lost a customer, or are about to. It
happens to every business.
No matter how bad you feel, don't waste the opportunity to find out what
went wrong and how you can improve. At the very least, you can learn to keep
others from leaving. Make it a point, then, to talk to or at least
communicate with every lost customer, or those who are heading for the door.
Here are a few important benefits to getting feedback from customer who are
leaving or who have already left:
• Win customers back. If you listen to customers who have left and respond
to their concerns, it's not impossible to win back 50 percent of them.
• Get competitive information. Feedback lets you know your strengths and
weaknesses, and it lets you know when your competitors are offering lower
prices, special programs, etc.
• Make training and investment decisions. Once you know your problems, you
know where to put your money to improve things.
Before you get these valuable benefits, however, you have to identify your
customers. For example, banks, magazine publishers and mail-order companies
have it comparatively easy: They can identify those who stop doing business
with them, and they know how to reach them, but what about an auto
manufacturer? They rarely know when they've lost a customer.
Companies like food manufactures, may see declining revenues but have
trouble finding out which customers are no longer doing business with them,
wholesalers, retailers or the ultimate consumer.
No matter how hard it may seem to stay in touch with customers, it can be
done, but in order to prevent customers from leaving, you first have to know
who your customers are. Here are examples of how different types of
businesses can identify and keep in touch with customers:
1. A retail business could issue membership cards that qualify customers for
discounts. The company's database then captures all buying information,
number of visits, items purchased, dollars spent and more.
2. A restaurant could log reservations into a computer, which lets it keep
track of how often people dine there. If a regular customer doesn't show up
for a while, a staff member calls to see if there's a problem.
3. A book publisher could bind a reply card into books. The card might ask
what the buyer thought of the book, whether he or she would like a catalog,
and so on. To get people to respond, the publisher could offer a discount on
the next purchase.
4. An appliance manufacturer could use warranty cards to get information on
customers. They could also have 800 numbers for problems and inquiries. When
consumers call in, service reps get names, addresses and phone numbers.
Even if you know your customer, it will help do define a loss. For example,
if a customer's business with your express delivery service is off 20
percent, if may reflect a normal dip, but a drop of 50 percent may mean the
customer is sending more business to a competitor, and that rates a phone
call.
Anyone who has contact with customers can supply you with valuable feedback.
Customer service reps, salespeople, delivery people and others can all help
you head off losing customers.
You should give anyone with frontline contact a stack of forms that asks the
customer for feedback, such as, what the customer doesn't like, reasons why
the customer is considering discontinuing business, the reps own impressions
about the customer, and suggestions for keeping or brining back this
customer. Have them fill it out every time they get feedback, especially if
he or she gets news of a customer leaving.
Most companies can do a much better job hanging on to customers if they
would just do three simple things; first, identify customers who have left
or are about to; second, rope them back into the fold by working to satisfy
their problems and satisfy their needs; and third use the feedback you get
from both lost and current customers to put customer friendly policies and
mechanisms in place.
About the Author
