Happy Returns

Five simple steps to winning back customers who've strayed.
Magazine Contributor
4 min read

This story appears in the December 1997 issue of Entrepreneur. Subscribe »

Well, I'll never do business with them again!"

How many of us have uttered those words? At one time or another, we've probably all felt that way about someone or some company. Truth is, many businesses experience customer attrition that seriously affects their profits and ability to grow. But much of this can be prevented or even corrected after the fact. How? By taking the time to do a little "post mortem" research and by developing a plan to go after those lost customers. Try following these five suggestions:

1.Develop a "Most Wanted" list. Before you can find out what caused customers to leave and how to win them back, you have to figure out who they are. Big customers are easy to keep track of, but countless smaller customers can slip away unnoticed if there's no system in place to snag the escapees. Some companies have computer printouts that highlight drastic drops in business from individual customers while others use notecards or tracking forms.

2.Find out why they left. Ideally, a personal visit from you is the best way to get this information. If you don't have time to do this yourself, train an employee to make those calls. The contact person must know the customer's history with your company, including what product or service they purchased, the reason they bought from you initially, how much money they spent with you and so on.

Here are two common responses to the "why" question:

  • "Your product/service wasn't what we expected." If a customer wasn't pleased with a product, service or employee behavior, press for details. How did the product fall short? Did the service not accomplish what the customer expected? Was the customer treated rudely or with indifference by an employee? Did your staff lack training or information on what was purchased?
  • "We found another company we like better." Nobody likes to hear this one, but get the customer to be as specific as possible about why they chose another company. Was it lower prices, wider selection, better service, location, free shipping? Then develop a legitimate response to each objection. Remember, lowering your prices is rarely the best way to beat the competition unless you find your prices are way above what others are charging. Focus instead on selling your ability to outperform the other company.

3.Ask for another chance. Apologize for any inconvenience or misunderstanding. If the lost customer had a legitimate reason for defecting, do what you can to correct the situation. However, if the customer offers vague or unreasonable excuses for why he or she left, think hard before diving back into what may be a difficult relationship. You might be better off without that customer.

4. Come up with a peace offering. When trying to win back an account or simply the good graces of a client, offer to do something extra for them, such as free delivery for six months or 15 percent off their first order.

5. Practice routine maintenance. Winning back a customer or an account is only half the battle. You have to continue servicing that customer with excellence. Contact him or her every few weeks to head off any concerns that might be brewing. Keep your records up to date, and let your customers know you appreciate them and their business. A personal note, a small memento, even a quick phone call can do wonders for building a beautiful relationship.

Leann Anderson is the owner of Anderson Business Resources, a Greeley, Colorado, company specializing in customer service, marketing and business etiquette.


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