Let me ask you a question. What is it that makes your customers decide to purchase from you?
I hope you know the answer, it will be different for each of you, and it’s something every business needs to understand to flourish.
Just as important though is another question, which, chances are, you won’t know the answer to… What is it that makes one of your customers STOP buying from you?
Too many businesses depend upon their ability to generate new customers and fail to realize the dramatic impact on their bottom line if they could just stop losing the ones they already have!
Don’t get me wrong, winning new customers is vital, and no matter what you do, you will lose customers. Every business does. What you need to do is limit this loss. There are enormous business payoffs if you do. Even if you win more customers than you lose, you are still missing out on a major growth opportunity.
Why? Because on average, every company will churn approximately half of their customers every five years. So there is enormous room for improvement. NBRI research has demonstrated that if you can hold on to an extra 5% of your customers every year, you could double your profits!
It’s vital to keep your existing customers as well as winning new ones because:
- It costs a lot less to retain a customer than find a new one.
- Loyal customers know you and your service and don’t always put price first, whereas new customers often do.
- Loyal customers usually place larger orders.
So what is the secret to keeping your customers, how do you discourage them from defecting to the opposition, and how do you persuade others like them to buy more?
To begin to understand this, we must know why customers defect.
Related Customer Surveys
Customer Satisfaction Survey – Customer satisfaction surveys from NBRI can provide your organization with the necessary knowledge and tools to improve customer satisfaction, intent to return, intent to recommend, and overall financial performance.
Customer Loss Review Survey – Understanding why customers leave is just as important as understanding why they stay. A customer loss review survey from NBRI can provide answers to these important questions.
View all Customer Surveys by NBRI.
Approximately 96% of unhappy people will not tell you that they are unhappy. They just stop buying.
Worse than that, they will tell multiple other people that they are unhappy with you. Only about 4% will proactively complain to you, so you must have systems in place to “maximize the customers’ opportunity to complain.”
So, your strategy should be to make sure you are listening to your customers. DIG for any complaints! Contact them regularly. When they order, ask if there is anything else you can do for them. Send out questionnaires about the service they are receiving. Conduct customer surveys. Most importantly, take swift action to resolve any complaints and criticism.
What proportion of complaining customers would keep buying and even buy more from you if you deal with their complaint efficiently and effectively?
NBRI customer research indicates that of all the customers who register a complaint, between 54% and 70% will do business with you again if their complaint is resolved satisfactorily. The figure climbs to a massive 91% if the customer feels that the complaint was resolved quickly.
What is more, customers who have had their complaint resolved satisfactorily will tell, on average, 5 people about the treatment they have received. More new prospects!
So the secret to keeping your customers is simple: listen, communicate regularly, conduct customer surveys, and deal efficiently and effectively with any issues they may have.
Chief Operating Officer
National Business Research Institute