How I Lost a Million Dollars Without Knowing It Was Happening When your best customers are buying from your competitors because they don't know you offer the same service, you're losing more money than you know.
By Shaun Buck •
Opinions expressed by Entrepreneur contributors are their own.
Have you ever lost a large sum of money before? If you have, you know that it sucks. What really sucks is when the loss could have been prevented by simple communication. To date, the largest amount of money I've lost (that I know about) is a little over one million dollars. There are many lessons to be learned from losing that kind of money. For example, even a pitcher of margaritas won't make you feel much better. My hope for you is that you can learn from my mistakes on this one, and prevent your business from joining the missed-opportunities club.
My million-dollar mistake.
In the spring of 2015, I got a call from one of my favorite people and our second-biggest customer at The Newsletter Pro. Let's call this strapping gentlemen "Jim." Jim is a great guy. When we chat on the phone we typically catch up on stuff like how our families are doing and what fun and exciting things we have going on before we jump into business. This call was no different.
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After we got all caught up, I asked Jim how his newsletter campaign was going and if he had any plans for additional direct mail this year. Jim told me the newsletter was going great, and other than the newsletter, an expanded new-mover campaign and cold-lead direct mailers, he had no plans for additional campaigns. I was instantly confused. What cold-lead direct mailers? Jim told me about it, and I said, "You know, we can do those types of campaigns for you, right?" To which he replied, "Really? I didn't know that."
I told him I'd love to take that campaign over for him. At that time Jim wasn't looking to change vendors, so we waited.
Near the end of 2015, I did finally got the call to take over this campaign, for which I was grateful and excited. The bad news is that I was able to calculate the estimated loss in sales for the time we didn't have his campaign, both before I knew it existed and after. It totaled $1,030,000 in needlessly lost sales.
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Lesson learned.
At The Newsletter Pro, we do a good job talking about newsletters, but obviously we aren't doing a good job of letting our existing customers know about the other direct mail services we offer. This error cost us over a million dollars in revenue from just one company. How much has been lost when we consider the hundreds of companies we work with? I'll never know that answer, but the lesson I've learned is that part of my job is to utilize our current media to communicate with our customers so they know about our other products and services. We need to let them know that they can get the same dependability, quality and expert advice by allowing us to fulfill their other direct mail campaigns. At the end of the day, this relationship benefits our customers as much as it does us.
We all have stories of lost opportunities. Unfortunately, I think most of us will never know just how much we've lost over the years, and as business owners we only have ourselves to blame. Frankly, in Jim's case I neglected my job of making sure our past and present customers know about the various products and services we offer. I'm sure at one point we may have each told our customers about our other products, but that simply isn't enough.
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Luckily, I learned from this mistake. I realized that it is not the customer's job to know who you are, what you sell or even to remember that you're still in business; it is your job to remind them. Otherwise, you may have millions of dollars' worth of revenue going to your competitors, simply because your customers didn't know they could come to you.
So the choice is yours: You can make a plan to fix the problem, or you can keep doing what you're doing. If you choose to stay the course, then one day you may find yourself in my club, having lost a million dollars … at least.
