Retaining clients is a critical component to growing any business. It is easier and less expensive to retain happy clients. Without repeat business, you’re always looking for new clients. If buyers continue to do all their research on-line, finding those new customers is an arduous and expensive task. When you have a good relationship with your buyers, they will help you find new customers by referring you to their family and friends. Bad relationships, on the other hand, can spell doom with the negative word of mouth, especially if social media is the way they spread that bad press.
The main reason why customers leave a company is because they believe that you don’t care about them. Almost 68% of those who leave feel this way.
Another reason your customers leave is because they had a bad experience with you. According to Oracle, 89% of those who had a bad experience will switch to another company, citing poor customer service as the reason. Some whose experience is bad attribute it to unfair treatment. If they perceive they are being treated unfairly, even if you don’t, that could be a trigger to move on to another supplier.
Limited access to customer support can frustrate a buyer and cause them to leave. Whether you take customer requests for help by phone, email or on-line, customers are looking for answers right now and don’t like waiting until tomorrow. If someone else’s customer service is more readily available, this could be reason to leave your company for theirs.
Just as word of mouth can work for you positively, it can also work against you. Every person who has a bad experience will tell at least two people, who in turn will pass the word along causing a ripple effect. In a recent study, it was revealed that broken promises are a breach of trust that can cause buyers to want to punish and seek revenge on the organization that failed to honor them. This revenge, many times, appears on social media in the form of a rant where many people see it.
Data from Marketing Wizdom found that about 20% of customers are lost by an average business annually due to a lack of a cordial relationship. This 20% needs to be recovered in new business just to stay even. It would seem a wise move to work to retain as many clients as possible.
Many clients reside in what we call the Zone of Indifference. They neither love you or hate you. They are just “meh” about you and your company. If something better comes along, they will jump ship in a heartbeat. When asked by their colleagues for a recommendation, you’re not even on their radar.
A client can feel trapped in a relationship with you, maybe because their cost to switch to someone else is more expensive than they can afford. But given the opportunity to move on from this imprisonment, they will leave in a nanosecond. Their feeling about your company borders on abusive; they can’t live with you and they can’t live without you.
You have to earn your customers’ loyalty continuously. As soon as you let down working on the relationship, your competition will be knocking at their door. If your customer is not recommending you, there is a problem that you need to fix.
So many companies have strategies and marketing in place to find and win new clients. Yet not many spend time on customer retention strategies. The mindset in sales for so long has been that we need to get new customers and open new markets. You get what you focus on. Having a strategy that emphasizes growing existing clients will have you seeing that growth, which won't cost nearly as much as finding a new client.
The customer experience starts with the first contact made with a prospective buyer and continues through to beyond the support and follow up on an order. Each customer will have a definition in their mind of what constitutes a good experience. It makes a lot of sense to know what that is. In the 2021 Customer Experience Trend Survey Report, 77% of respondents reported being more loyal to a company that offers a good customer experience; 50% said that the customer experience is more important today than a year ago. 72% said they are willing to spend more from a company that offers a good customer experience. If a good experience equates to better value in the customer’s mind, then that value is worth paying a higher price.
If your employees can’t describe the customer experience, then how can they provide a consistently good one? The experience needs to be universally known and used versus being dependent upon your customer getting the one good team that provides good service.
A mere 5% increase in customer retention can increase a company's profitability by 75%.
Harvard Business Review
Strategic Enhancement Group has been helping sales people learn the skills to be able to differentiate since 1984. We can help your sales team learn how to differentiate by:
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