In a nutshell: You might not always be able to win back a former customer or client, but there are steps you can take to learn from the loss and strengthen your organization.
It happens to every company at some point: A loyal customer or client decides to take its business elsewhere. While this might seem like a failure, it should be seen instead as an opportunity.
The best strategy, of course, is to keep from losing the business in the first place. The conventional wisdom is that it’s five times less expensive to retain an existing customer or client than to acquire a new one, but this figure varies by company and industry.
If you’ve lost an important account, here are some things you should do.
Find Out Why
Not all customers and clients leave because they’re disappointed. Sometimes, their needs simply outgrow what your company is able to provide. Consider the example of a customer or client that has expanded nationally when your footprint is only local or regional. Or a company that needs more products than you can manufacture. Be happy for these companies and stay in touch with your contacts — you never know when they might re-engage you.
You should be worried about the customers and clients that are dissatisfied. These are the ones that aren’t pleased with the products and services you’ve been able to provide, and this is alarming for two reasons:
- They will seek out other companies to provide products and services
- They won’t recommend you to other companies
Look in the Mirror
Never assume you know why someone walked away from your business. Losing any customer or client is a good time to take a hard look at what you do well — and what you don’t — to determine if there are any gaps in production, delivery and service.
One of the most helpful techniques for assessing your company is a SWOT chart. SWOT stands for Strengths, Weaknesses, Opportunities and Threats. There are many templates and guides available on the internet — just search for “SWOT.”
Another technique is to develop a customer journey map, which is a visual representation of every touchpoint a customer or client has with your company. Salesforce.com, a leading provider of customer relationship management software, details several benefits of customer journey mapping. One advantage is that customer journey mapping helps you determine whether your selling process aligns with the customer’s or client’s decision-making process. Again, search the internet for templates and guides.
Talk to the Customer or Client
The best way to learn why you lost the customer’s or client’s business is to ask. Even though the conversation might be uncomfortable, set up a time to talk. It’s very important to not get defensive — you are there to listen and look for ways to improve your organization. Ask open-ended questions. Make sure the customer or client knows that you’re making an earnest effort to learn.
There are two advantages to talking things over with the former customer or client. First, you might get information you can use to strengthen your relationship with other customers or clients. Second, you’re signaling to the company that you want to listen to their needs, which might prove advantageous in the future.
Know When to Walk Away
Is it work the time and effort to try to win back former customers and clients? Not always. Sometimes, a company might only represent a small part of your revenue and profit. And other times, the company may be difficult or disruptive. In these cases, the loss might be acceptable — and even beneficial in the long run.
Entrepreneur says irritating, rude and time-intensive customers and clients might not be worth trying to retain.