4 Critical Mistakes That Cause Your Customers to Leave
One of the biggest threats for businesses is when a customer heads for the door and others follow suit.
Loss of customers is every entrepreneur’s nightmare and that’s why customer relationships are such an important aspect for effective brand building.
You don’t just want to concentrate on attracting new customers. It’s vital to keep the existing customers happy by giving them the best of both worlds — hospitality, and attention.
The following signs listed below are critical to keeping an eye out for if you wish to retain customers.
THE IMPORTANCE OF CUSTOMER RELATIONSHIPS FOR BUSINESS PROSPERITY
Look at some of the biggest companies in the world — Apple, Microsoft, Amazon, etc.
Now ask yourself what makes these companies such a worldwide success?
Is it because of its innovative products? Or is it because of their exceptional marketing campaigns?
Wrong and Wrong.
The reason these successful companies have a history of outstanding sales is due to their relationship with their customers.
Loyal customers are always returning customers. Successful companies possess customer relationship goals such as —
- Ensuring customer expectations of the product is met
- Accuracy in delivering product presentations
- Building a product that is user-friendly and advanced
- Adding innovations to an existing product chain
- Providing excellent after-sales customer service
- Ensuring outstanding issues are quickly resolved
As a business owner, ask yourself if you’ve applied the following points to your business.
Let’s begin with a small quiz to understand how much you know about customer relationships.
Imagine you’re a new business owner, what is considered the right way to launch a business among the following options.
- Spend a large budget to attract new customers. Ignore customer retention as your business needs to expand.
- Concentrate heavily on providing exceptional customer service and a strong relationship bond.
- Ignore marketing campaigns and customer retention programs and focus on the product. If your product is solid, you’ll attract the customer through word-of-mouth.
If you’ve answered A or C, you absolutely need to go back to the drawing board and learn the basics of business.
If you’ve answered B, then Congratulations! You understand just how important customer retention is over attracting new customers.
Here are our reasons why.
Attracting new customers with a poor customer relationship program causes your customers to immediately exit your brand.
So, if you’re pulling in 1000 new customers every month and retaining only 50 that’s a 5% customer conversion rate.
However, if you focus on terrific customer relationship programs and manage to retain 30-40% of your monthly customers, even if you attract 500 customers every month, you retain 200-250 customers compared to just 50 for every 1000.
Quality always wins over quantity.
Similarly, if you focus exclusively on your product to attract customers, then no one’s going to hear about your product and even if they do, they will reach for the exit due to the nonexistent customer service.
Also, here are the major advantages that loyal customers provide you with.
1. Repeat Flow of Business
Loyal customers are a constant source of income to any company. Don’t believe us?
Read this report conducted by Call Miner — Every year US businesses lose a shocking $136 billion in profits thanks to consumer switching.
Customers that bond with your brand has a higher percentage of buying your next product release.
So, if you’ve been concentrating your business goals on ‘Customer Acquisition’, it’s time to give it a long and deep thought on why ‘Customer Retention’ is a long-term benefit.
2. Lesser Marketing Costs
Just imagine an excited and loyal customer finds your new product beyond their wildest of expectations.
What would they do next?
They’d share it with their friends and family via social media and word-of-mouth. This ensures everyone knows the benefits of your products.
This type of free advertising decreases your overall advertising costs.
When your customers leave a favorable review of your product, this influences other buyers to act based on the positive review.
This creates a chain of positivity left behind by your loyal customers.
Internal customer acquisition costs no money to your company and you directly benefit from the good word about your brand thanks to your loyal customers.
3. Positive Brand Image
How else did Apple and Microsoft become such reputable brands?
Through years and years of loyal customers spreading the positive brand image to their friends and family.
- Businesses thrive on profits and building up a list of loyal customers is a top priority for increasing revenue
- Loyal customers bring in new customers and help promote the good word of your brand across
- Financially affordable to maintain existing customers than to bring in new ones
- High customer retention means you’ll never face market rejection
- Satisfied customers generate 6 times more income in a year than unsatisfied ones
4 BLUNDERS TO WATCHOUT FOR TO PREVENT YOUR CUSTOMERS FROM MAKING A HASTY EXIT
Let’s lay out the statistics to give you an in-depth look at just why customer retention is such a critical aspect for a business to thrive.
- Several U.S. companies spend up to 5 times the cost for customer acquisition instead of maintaining existing ones.
- An existing customer has a 60-70% chance of buying your new product while a new customer has a 5-20% probability to buy.
The good news is all of this is completely avoidable. To prevent such an epidemic, it’s necessary to pay attention to the 4 vital signs that customers demonstrate before leaving your company.
1. Customers Buy Lesser Over a Period of Time
An obvious sign to understand if your customers are starting to lose interest in your products is by their buying patterns.
A steep decline in their purchase history is a red flag which means your customers have found a new source to buy from.
Some of the reasons your products or services don’t sell well are –
Your Products Lack Awareness
Customers don’t buy what they don’t understand.
It’s your job to provide the information on the product and convey the usability in easy-to-understand descriptions.
Here are the following ways to find out if you lack product awareness.
- Do a quick google search of your brand or product and look up the results. If there are no interesting articles or networking pages advertising your products on the first page of Google, you’ll have to improve your online marketing strategies.
- Find out if industry experts are reviewing your product or service. One of the fastest ways to build customer relationship is when your product is being discussed by the powers-that-be. Ensure you provide plenty of samples for experts to review.
- Brand positioning is critical in identifying your company and the service it provides. Many companies fail to mark their territory and end up distributing to all sectors. This causes confusion and your customers are bound to find a company that remains consistent in their brand positioning.
Your Products Lack Innovation
Let’s understand this section with an example. When Apple launched its 2017 MacBook Air, a majority of their consumers were disappointed. The reasons were due to
- Thick bezel edges on the screens
- An outdated display featuring 1440×900 pixels
- Utilizing an older version of 5th gen intel processor
- Poor 480p camera
- Bulkier build
With this, we learn that even the largest of corporations aren’t immune to the outrage of their consumers.
Apple quickly rectified the mistakes and came up with the 2018 MacBook Air which featured.
- Slim bezel edge to provide a larger viewing area
- Upgraded retina display with 2560×1600 resolution
- The latest intel 8th gen processor
- Exceptional 720p front camera for brighter video quality
- Slim and sleek build
Within a year’s time, Apple redefined its ‘Air’ segment and gave it a breath of fresh life.
The innovative features were praised by many industry experts and brought Apple back to the mainstream laptop market once again.
Without innovation, your products will lose appeal and your customers will shift their loyalties to a brand that does provide them with it.
Your Products are Inaccessible
Sure, your products are the best bang for the buck that money can buy but what good is an exceptional product if it doesn’t reach your loyal customers?
Imagine your product does well in a different demographic in a different part of the world but since you haven’t set up a shipping route to your customers, you end up losing out on valuable customer relationships in the long run in that part of the world.
Accessibility of your product is key to maintaining and building loyalty with your customers.
Always spend time to understand the target demographics that your product caters to and ensure you’re better equipped to allow customers from various parts of the world to enjoy your product.
If you’re primarily selling your products within a physical store and you’ve researched that a different part of the world has demand for your product, consider setting up an online store.
Contact nearby logistic partners to understand the cost it would take to ship a product overseas, once you’ve reached an agreement, you’re all set to open a new business opportunity.
2. Customers are Unhappy with your Delivery Management Model
A broken delivery structure is a bane to a good business model. When a customer places an order on your website, they’re excited and are looking forward to receiving your product.
If you don’t keep good on your promise and end up delivering past the promised time, you’ll fall from their grace.
Don’t take our word for it, the following research conducted by MetaPack 2016 State of Ecommerce demonstrates that 87% of UK customers are likely to buy from the same online retailer if the delivery experience was a positive one.
Here is a checklist to ensure your delivery management remains exceptional and doesn’t disappoint your buyers.
- Among all the countries surveyed in the world, Free Delivery was the most important factor for customers to feel satisfied when placing an order.
- Offer discounts for bulk purchases, this cuts down the total cost you spend on shipping.
- Offer one-day or two-day shipping to locations that are closest to you for a positive experience.
- Offer a collect-in-store option so that customers have the choice to pick up their packages directly from your store without a waiting period.
- During a peak sale period, provide a notice on your website stating you’ll be unable to provide a faster delivery option due to the rush. Your customers will understand.
- If your shipping out of your country, provide a minimum buy order for free shipping for a smooth experience.
- Offering free returns and pick up can be advantageous to your business model in the long run. However, you can request the customer to ship the item back and reimburse the shipping cost to build positive customer relationships.
- Provide a drop-off point for local customers to return their packages.
- Ensure all the delivery details are clearly mentioned on your website in every product’s landing page. You don’t want your customer to find out the hard way.
- Choose a good logistics partner and eliminate loss or damage to products during transit.
With modern convenience affecting the decisions of buyers, it remains more and more critical for businesses to pay special attention to their delivery process.
Speed is the name of the game in the business world.
You win the rat race if you ship the product out faster than your competitors.
3. Customers Must Deal with a Long Escalation Process
The term escalation denotes heightened intensity or intensification.
It’s no wonder that when a customer is put on an escalation process, they expect their issue to be solved by the management at a faster pace and expect a positive result.
However, when best practices of customer escalations aren’t in place, your customers are faced with long queues causing them prolonged frustrations.
Even the most loyal customers, when faced with dissatisfaction from their favorite brand, will decide to exit your brand for good.
That’s why it’s important to set up preventive measures in place to experience the best customer satisfaction by using the following methods.
1. Escalations are Preventable
Ensuring minor issues are solved immediately prevents putting the customers on the escalation ladder.
This allows your escalation department to focus on critical issues that demand their attention.
Imagine the customer issues were a burning building and your escalation team are the firefighting squad.
If your team had one big fire to deal with, the building could be extinguished immediately.
However, if the team had to deal with little fires creeping up everywhere, then their attention would be divided, and it would only prolong the catastrophe.
Training your customer service team to provide direct solutions is the first important task. The fewer escalations there are, the lesser frustrated customers you’ve got in the long run.
2. Limit Email Interactions
An email is considered an impersonal form of interaction between a brand and its customers.
An email doesn’t necessarily get the emotions or frustration of the customer across.
Depending on the patience level of your customer, an email is a sure way to add to their discontent as it comes off as automated.
Customers don’t like when they are being answered by an automated text for their patience.
After all, they take time off from their busy schedule to get in touch with your brand and the last thing they’d expect is an automated response from the customer support.
During escalations, the ideal solution is to have a customer support team member call up the customer and notify them that their grievance has been registered and it’s only a matter of time for the query to be resolved.
A single human conversation adds reassurance and destroys the unnecessary chain of emails that do nothing to provide confidence to the customer.
3. Converse Reassuringly with Your Customer
During an escalation call, a customer is expected to be aggravated and hence, their tone is bound to be aggressive.
Critical as it may be, it’s necessary to train your personnel to handle these situations in a delicate manner and to instill credibility.
Here are some of the sentences to avoid during a call with your customer.
- We are sorry, but this isn’t our fault. Even if it isn’t your company’s fault, you’ll need to choose your words carefully and sound emphatic. First, listen to what the customer has to say and then proceed to make them understand where they’ve been mistaken. If it’s something minor, providing a positive resolution will make your customer’s day and will certainly improve the loyalty for years to come.
- This hasn’t happened before. A statement like that is bound to implicate that your customer is either lying or you don’t have a solution to their query. Both convey ignorance and will certainly cause the customer to see red. Instead, provide a timeframe to investigate the matter and get back to them.
- It’s not part of our policy to offer a refund. Accountability is key to building customer relationships. Putting it across as not in your policy may seem like the customer is being taken for granted after a sale. Think of the bigger picture and let your customer off the noose if they indeed didn’t pay attention to your terms and conditions. A small refund goes a long way in ensuring your customer remains loyal to you.
The bottom line is, when a customer reaches for the phone to dial your customer support number, they are actively expecting a positive response to calm them.
After all, no one wants to end up on the losing side of a long escalation process.
So, unless you’ve got good news at the other end of the rainbow for your customers, it’s best to prevent the escalation process altogether and come up with immediate and direct solutions.
4. Poor Customer Service from Your Employees
Customer service is the key to customer satisfaction.
When you first set up your business, allocating funds to your customer service department seems a huge waste of finances.
After all, when you haven’t fished out your first customer of the day, customer service sounds counterproductive.
Let’s take for instance that you’ve attracted your first few customers, without a customer service team to answer their queries, you’d have to spend your valuable time answering straightforward queries. Is this how you’d like to utilize your valuable time instead of focusing on critical business matters?
Alright, you’ve made it two years into your business and established a customer support team. Interestingly, that isn’t enough either.
A customer service team is the soul and heart of your company. A happily serviced customer is a returning customer.
And one of the first things customers often speak to their friends and family about is – exceptional after-sales service.
Achieving remarkable customer service standards is your first goal. Here are 3 key characteristics to deliver unprecedented customer support to your customers.
1. Crystal Clear Communication
Everything about customer service relies on flawless communication.
Training your employees to be apologetic and sympathizing with your customer’s situation takes your brand a long way in bridging customer relationships. Phrases like –
- “We completely understand and stand by your predicament. We will make sure we get to the bottom of your issue.”
- “We will send you an update by [insert time frame]”
- “Will that be all or is there anything else that we can assist you with?”
- “Thank you for bringing this to our attention, we will certainly work out a solution and ensure all of this is cleared.”
The above phrases demonstrate empathy and reliability. Letting your customer know an exact date demonstrates brand authenticity in solving problems.
Customers like it when they receive a positive response from their favorite brand and if your team communicates in a timely routine, your customers are bound to be impressed and grateful.
2. Attention & Patience
Train your employees to keep their ears open to listen to the problems of your customers.
It’s usually a bad sign when a customer is forced to repeat their issue because your employees were busy talking to themselves.
Customers are always stretching their issues larger than they seem to be and it’s the customer representative’s duty to be patient and pay undivided attention to what they are saying.
Usually a customer will never stop at “The product makes a noise and doesn’t start”, instead they could come off aggressive and state something like “Your stupid product doesn’t work, it makes such a loud noise that it gives me a headache, give me a solution for this or I’ll have a word with your superiors about you.”
Scenarios like these are common and your customer representatives must be trained to keep their cool and calm the customer down. If the customers are being overly aggressive and verbally attacking your staff, train your staff to give them a warning before hanging up.
You don’t want foulmouthed customers near your brand anyway.
At the same time, it’s considered as a good practice to monitor the calls of your customer service team to supervise if they aren’t using any obscene language.
3. Knowledge of Products
When your customer service team has background knowledge of your products, they can conveniently close down queries quicker and save valuable time.
The customer wouldn’t have to spend a good ten minutes on the call explaining how the product works and what the issue is.
To give your employees a good introduction to your product, you’ll need to spend a few weeks in sharing the company’s goal and vision.
Schedule team meetings and explain any new features that have been implemented, updating your customer support team with the latest changes to your product will have a positive impact in the way they resolve customer queries without the need to escalate an issue.
Employees that don’t have prior knowledge on the product will simply forward the call to another department or worse – will sound ignorant to your customers and this leads to further aggravation.
Elyse Roach from Help Scout states “Having the best tricks up your sleeve helps customers navigate through even the most complex situations with ease. This is a critical mission for setting up a strong customer support team.”
Ultimately, a trained customer support team is equipped to tackle customer issues in the best manner possible than an untrained customer service team who’ll simply be forced to read out a scripted sheet in front of them.
There is no heart behind the support provided.
When a customer steps out of your business, there’s no turning back.
There are no warnings like a weather forecast to notify us about the impending signs of danger lurking in the business.
We either choose to respond to the threat of customers leaving by creating defensive barriers or suffer the collapse.
Customer service is all about maintaining a reputation and humanizing your business.