Think About What You Can Learn From the Customers You Lose
Here is a situation that businesses repeat much too often.
I am amazed
After more than a year as a regular customer … paying a $150+ each month, investing an incredible amount of time participating in discussions with them regarding the use of their product …
We cut our spending with the company by 50%.
And Incredibly
The company never asked “why?”
Disappointed by a Continued Failure to Listen to Customers
Two months later, we stopped all purchases.
And Again
The company never asked “why?”
Why?
I’ve always been taught that a business can gain valuable insights from the customers it loses. From them, you learn what you could have done to keep them satisfied … how to retain and regain customers.
It made no sense to us, but confirmed our decision.
My Marketing education and experience says “customer research is critical.”
My Sales experience says “find out what went wrong.”
My Strategic experience says “learn how to fix it.”
And reinforced the idea that Common Sense is truly an uncommon commodity.
In the days that followed we learned that other customers had dropped away.
Each one of them reported that …
The company never asked “why?”
Is Your Feedback Important?
Hey Brian!
Well said. It’s only a pity that the particular company may not realise where it has gone wrong. Is it that they are more focused on developing and increasing it’s customer base as oppose to retaining those which it currently has?
Unfortunately, many companies operate in this very similar manner. The question I therefore ask; When will they acknowledge the “power of the consumer” ?
I thank you for sharing this with me. Let us learn the lessons contained therein so that we too do not fall prey to similar unfortunate practices.
Thank you for your comments, Dwight.
I think you are right regarding their focus.
In addition, there is the problem of cognitive dissonance. They sell what they describe as a “solution” but it fails to live up to the hype of the sales pitch. Customers think they are buying into one thing and it turns out to be something else.
In a situation like that a company should ask itself a couple questions:
1. Do we sell to the right people?
2. Do we sell the right thing?
3. Do we sell the right way?
4. What changes would improve business growth?
Some companies in this situation seem to suffer from the “Emperor has no Clothes” Syndrome. When the Emperor (leadership) only listens to their cheerleaders they don’t realize they are walking down Main Street naked.
Dwight, I think we can avoid these practices by keeping our eyes, ears, and minds open.
Thanks again.
Brian,
That’s what makes great companies great and bad companies mere memories in the dust when they close.
Yes, frustrating for the consumer having invested both time and money in the company but I believe it leads to a more savvy, demanding and educated customer because of their negative experience. Ultimately this leads to higher expectations from the consumer the next time they venture into the field so to speak thus making it a necessity for those remaining companies to raise their bar. I think we all win.
Why does it have to be so difficult ?…..Never ceases to amaze me how a huge difference to a company’s bottom line can be made with minimal dollar outlay and a little common sense.
Hi Brian,
Wanted to shared an experience I had yrs ago when I took my first outside sales job for a company distributing Lab Instruments and supplies. Being my first sales experience it was very difficult to not only learn how sell effectively but to get over the fear of cold calling.
After a slow start, I asked the business owner if he kept any data on old customers and why they left. Of course not. I did find out that a different section of the company kept records on shipments that gave a very detailed description of who bought what and when over the last 5 yrs. On a cold miserable afternoon I sat down to review the data and found a big Chemical Plant customer who had purchased a pack of septa every quarter or so for at least 2-3 yrs and then stopped. Reasoning that they may have simply not needed the product but that a multi-million dollar plant must be buying much more that that from somewhere, I called the person whom the septa had been shipped to over a year ago and explained I was the new salesmen assigned to his account.
The next five minutes were painful as I was regaled with a story of how stupid my company was. The previous salesmen had sent the septa as usual but they turned out to be slightly different than what the client said he ordered. He was then told that there would be a 20% stocking fee ($6.00) to return the septa. The discussion about what was ordered vs what was delivered proved worthless and damaging. That’s went he stopped using us. I apologized on behalf of the company and ended the call. A few minutes later, I had convinced the septa supplier to send me a batch of septa as a trail for a “new” customer and delivered those the following week taped to a box of doughtnuts and my card. That $30/quarter customer became a $3,000 a month customer within the next few months and gave us letters of reccommendation to show other prospects.
How many dollars are in your old customer files waiting to be claimed? From that point on, I couldn’t wait to hear about a slight mistake or misunderstanding with other clients so that I could ride in and exceed their expectations.
P.S. I have changed industries twice now but that customer is still my customer and the firm I was originally working for has shrunk by half since I left. Probably just a coincidence. Reb
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