Tag Archives: customer retention

Customers: Lost & Found

This is why you think the customers that you have lost have stopped doing business with you:

•    Can’t compete on price
•    Key contact left the company
•    Bad customer experience
•    Ummm… don’t know why

In reality, here are some real reasons they gave as to why they stopped doing business with you:

•    Vendor stopped calling us
•    Didn’t grow with us
•    Unwilling to be creative
•    Only heard from them at renewal time
•    Unresolved bad customer experience
•    Someone else wanted the business more

The differences between these two sets of reasons point to a key communication gap. A typical scenario: Former Customer says,“I never hear from them, and someone else appeared who took more time with us. So we went with a new outfit.”

When asked if they would consider doing business with their old vendor again, Former Customer said he would certainly consider it, but wasn’t sure that his business was important to them. This should be an “a-ha!” moment for the old vendor.

So think about it: what if you could recover 10-20 percent of your lost customers? It would likely have a significant revenue impact for you not only this year, but in future years.  It’s not always comfortable to reach out to former customers, especially if they were disgruntled.  But you may find it well worth your time to reconnect, and this time, LISTEN to them.  Addressing their issues might be easier than you think.

Click here to read more.

— Lisa Dennis

Customer Retention – What is it, Really?

It wasn't so long ago, when people said "customer service," it meant a group of fairly low-salaried people in cubicles, wearing headsets, struggling to answer questions and complaints from customers.  Then came a period of enlightenment, when someone said "Customer Service is NOT a department!  It is a business philosophy and part of everyone's job!"  This is when businesses started realizing that service wasn't a nice-to-have, but something that customers expected as a baseline for engaging.  Businesses started seeing customer service as a differentiator.  This is not to say that the execution of customer service has gotten much better, but at least there is more of an understanding of its role in the business equation.

So now, in the midst of the Great Recession, the new (and misunderstood) buzzphrase is "customer retention."  And guess what?  History is repeating itself!  Surprise, surprise.  "Customer Retention departments" are popping up everywhere.  But they are often used like relief pitchers in a baseball game, brought in to "save" a situation.  This is NOT what customer retention is all about!

When a customer is irritated, frustrated, unhappy, or downright angry, he or she is now frequently transferred to a "customer retention specialist," whose job it is to placate the angry customer, perhaps throw him or her a bone, and salvage the business relationship.  Technically, I suppose, this does define customer retention in some sense.  But in reality, giving an employee a script on how to try to keep a customer from leaving your business is a far cry from what customer retention is all about.

Like customer service, customer retention is NOT a department, but a philosophy.  It is not about "salvaging" a business relationship.  It is about solidifying one.  It's not about having a closer in your bullpen; it's about having an entire great pitching staff who participate in every game.

Customer retention is the combination of things your business does for customers on a regular basis to make them not want to leave you.  Customer retention makes your business impervious to sales, discounts, deals, introductory offers, and the like from your competitors.  Customer retention is a combination of excellent customer service, regular and valuable customer communication, the anticipation of customer needs, and creating and maintaining an enjoyable customer experience.  Customer retention is something that is done all day, every day.

If you do it right, then your business won't need the "customer retention department," because customers will not be trying to close their accounts.  You may want to pick up a few more service-oriented personnel, however. Your staff will have their hands full, taking care of all the loyal, happy customers you have!

   — Chuck Dennis

“You Can’t Always Git What You Want…

… but if ya try sometime, you just might find, ya git what ya need.”

I doubt that Mick & Keith had customer service in mind when they penned that song.  Nonetheless, it does apply.

I write a lot about customer service issues, and its enormous contribution to an organization’s customer retention.  In this blog, I like to use real life examples to underscore my points.  Like these:

  1. I have a subscription to a music downloading service called eMusic.  I received an email from them, saying they were sorry I had CANCELED my subscription, and that if I would re-activate my account, they would give me 75 FREE downloads.  Wow.  Pretty cool stuff.  But I hadn’t canceled my account.  I realized this about the same time eMusic did, because about six hours later, here comes an email from eMusic instructing me to disregard that last email.Talk about deflated. I had already started plotting out which obscure jazz & blues CDs I would get for FREE.  Now I’m told, ehhhh…you there… not so fast.  As Muddy Waters told us, “ya can’t miss nothin’ ya never had.”  But, with no expectations, I decided to see what, if anything, eMusic would do for me if I acted kind of put out about this.

    My first email (sort of tongue-in-cheek) was strategically turned around on me, and I was cheerfully thanked for my feedback, and assured that it would be passed on to the director of marketing.  But nothing about sorry for getting your hopes up, here have a couple on us.  Nothing like that.

    My second email was met with a sort of shrugging “sorry” response from a different eMusic rep.  Hey it was a technical glitch that resulted in you receiving an errant email, and no freebies for you.  Sorry.

    So, clever man that I am, I responded, asking what if I canceled my account.  And THEN re-activated it, just like the email said?  Would I qualify then?

    One can almost hear the deep sigh and see the rolling eyes of the third member of the eMusic customer service team to have to deal with me.  Lilly told me that she would, “as a one time courtesy” add 10 free downloads to my account, but they were going to expire in 30 days, and only good if I kept my eMusic account activated.

    So, ultimately, after 6 days, they did the right thing.  Kinda.  But look, if they can afford to throw out 75 freebies to every defector in a customer retention campaign, then they can afford to throw out 10 freebies to loyal customers who were sent an offer – an offer that eMusic has no intention of honoring – in error.  Ya know?

    This could have been handled a lot smoother. They could have taken the high road, made some humorous comment about mistakenly delivering bad news, and then thrown in the 10 freebies as a “no harm, no foul” gesture.  THAT’s how you build customer loyalty.  THAT’s how you retain customers.  (Plus, your CSRs wouldn’t have to go back and forth with a nut like me for a week!)

  2. Now, the other side of this coin is a company called Hydropool.  I regularly order the chemicals for our hot tub from them.  They have a regular email campaign, touting their latest specials, and their latest mentioned free shipping for orders over $75.  Well, I placed the order, but neglected to add the special “free shipping” code.  As a result, my invoice had a charge for $8.00 for shipping.Now, this is not the biggest issue in the world, but eight bucks is eight bucks.  So, after placing my order, I get the email confirmation of the order.  Immediately, I respond to that email, saying I messed up and failed to include my free shipping code.

    First thing the following morning, I get an email from Ryan at Hydropool, who assures me that as soon as the order ships, he will credit out the delivery fee.  True to his word, the following day, I received notification that my order had shipped.  The next day, I received an email from Kameel at Hydropool, providing documentation of my $8.00 refund.  SIMPLE.  Beautiful.

    The only thing Hydropool could do to make this better is really embrace this 21st century and the technology it has given us.  What I am referring to is using shopping cart software where rewards for purchase amount-based incentives are applied automatically.  The whole code thing is so 1990’s, ya know?

    — Chuck Dennis

Customer Relationship = Customer Retention

In a good blog post, called It's the Relationship, Stupid, the author (one of the principals from My Creative Team, in Charlotte, NC) talks about the difference one new manager made in turning a local restaurant from good to great.  This manager inherited a restaurant where the author had experienced pretty good food, but pretty spotty service.  The new guy took it upon himself to meet his customers, learn their names, learn what they liked, offered some freebies, and most importantly, REMEMBERED all this stuff the next time the author and his wife returned.  Suffice to say, they return much more frequently now.

This is such a simple concept, and not just for the restaurant or hospitality industry, but for ANY business.  EVERY business.  This is not rocket science.  This is Basic Humanity 101.   If you get to know someone, they will get to know you.  If that someone is a customer who purchases product or service from you, they will purchase more from you the better you get to know them, and they get to know you.

For some reason, this common sense idea is often overlooked in the business world.  Not enough effort is made, because not enough thought is put into it.  Not enough incentive is created for the customer-facing personnel to make this effort – something that they would likely do instinctively in their own home – at their job. 

Management needs to decide how they want their customers treated, right down to the specifics.  Then they need to reward the employees who treat their customers in this way.  And they need to NOT reward any other kind of treatment of their customers.  This is the tricky part: drawing the line in the sand between ideal service behavior and everything else.  Businesses who are serious about retaining customers long term will take this to heart.  Businesses who don't get it will not want to raise the fuss and risk causing resentment between the unrewarded employees and the ones who get rewarded for doing the right thing.  Those businesses will continue to get spotty service delivery from their employees, and will not generate customer loyalty.

  — Chuck Dennis

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