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10 Ways To Lose a Customer

August 31, 2010


It’s been a mixed couple of months as I observe the customer service attitude of vendors and retailers that I frequent both personally and professionally.  It seems as though many companies are glad to have business, but they are very reserved in their customer appreciation. If you want to gain customer insights and learn more about what makes them want to stick around, treat them better and for goodness sakes, DON'T do anything on my short list of the top 10 ways to lose a customer.

Top 10 ways to lose a customer (shortlist):

  1. Let your corporate policy get in the way of what is right
  2. Don’t acknowledge a problem and don’t offer to do anything about it
  3. Overpromise and don’t deliver
  4. Give prospective customer a better deal than your current ones
  5. Ignore your customer except for when you need to invoice them
  6. Complain about them in a public forum like Facebook or Twitter
  7. Give them a contract that holds them hostage with heavy exit fees or service up-charges that keep them with you- unhappily
  8. Treat their referral badly
  9. Sell their name to someone else without their permission
  10. Make them repeat what they want, over and over again

 

Here’s more detail on each of the above:

1)    Let your corporate policy (or systems) get in the way of what is right

This one came from my dealing with American Express.  I can buy an Amex gift card
using my card but could not use a card that was given to me to pay off my bill.  Why?  Bottom line is that their systems did not support it.  In the end, they made it up to me, but I was one of the most frustrated card holders they could possibly have for better part of a week.  How many times do you hear – sorry, we don’t do it that way?  If you find yourself saying that a lot, you’ve got a business opportunity or an unmet need.

2)    Don’t acknowledge a problem and don’t offer to do anything about it

Everyone makes a mistake, and the best vendors acknowledge it, apologize, make good and move on.  Are you empowering your employees (or as an employee, are you empowered) to fix a customer issue and make up for it?  If not, you are regularly losing moments of truth where you can create customer satisfaction out of a bad situation.

Think of your customer as if it was you in a restaurant.  Your meal came late, cold or incorrect.  If the manager voluntarily removed it from the bill and told you they did so with an apology, you probably felt gratitude to the establishment.  If you had to ask them to remove it and they did, you probably still felt okay, but likely walked away saying to yourself “ I should not have had to ask them to do that”.

3)    Overpromise and don’t deliver

This is a “duh” but it needs to get said, again.  Do promise what you can’t deliver.  And if you think you can, but haven’t done it before, then be up front with your customer.  Most people and businesses are pretty understanding when they have the whole picture.  And if they aren’t understanding, you probably don’t want to be trying out something new on them.

4)    Give prospective customer a better deal than your current ones

Don’t you love the magazine and cell phone offers that give a new customer a better deal than you can get as a current customer?  Yup, I do too. Don’t do it.  If you need to create an incentive to get new customers, make sure your current customers have access to the same value or better.  Or better yet, have some customer-only offers that only your current customers can get.

5)    Ignore your customer except for when you need to invoice them

If you are lucky enough to sell a product with a recurring renewal or subscription, make sure that invoice time is NOT the only time they hear from you.  Have a current customer newsletter or mailing.  Hold events for them.  Send them a thank you note on their birthday or anniversary.   Find some reason to reach out to them with something other than a bill.

6)    Complain about them in a public forum like Facebook or Twitter

Complaining about them in email will also likely get back to them too!  Even if you don’t think your customer is on Facebook or Twitter or LinkedIN or any other social site, someone that knows them and who will pass on your comments will.  And in an email, even if you think its private, is still pretty risky.  How often do people forward things without reading the entire email string?  The old rules still play here – Good news and nice things in writing, bad news and complaints by voice (and NOT voice mail)

7)    Give them a contract that holds them hostage with heavy exit fees or service up-charges that keep them with you- unhappily

You’ll keep the customer during the contract, but once it ends, they are gone. Period.  And they’ll be sure to tell everyone they know about what a jerk you or your legal department is.  If you really need a contract that strong to keep a customer, you should spending less on lawyers and more on making your product or service right.

Just do a quick Google search on termination fees for your cable company, cell phone company or pretty much any large corporation that is providing a faceless service, and you’ll see what I mean here.

8)    Treat their referral badly

If someone trusts you enough to refer a friend/colleague/partner over to you, you need to treat it like gold.  When you mess up a referral, you not only hurt the prospective customer relationship, you damage the trust your customer had in you too.

9)    Sell their name to someone else without their permission

Just because someone bought from you doesn’t mean they want to hear from 50 other businesses that you sold your list to.  Get permission to pass their name on – it will create more trust with the customer and if granted, it will make the pass-along more valuable to the person you are giving the name to.

10)     Make them repeat what they want, over and over again

If I took the time to fill out your form, send you a detailed email or in some other way was explicit about what I needed or wanted from your company, then don’t make me repeat it over and over again. Get your CRM system in order. Document the services required. Create a checklist. Do something so that I don’t have to keep track of what I am paying you to do for me. PLEASE.

Do you have a way to lose a customer that I missed?  Let me hear it.

Dan Kraus
Written by Dan Kraus

With more than two decades of experience in sales, marketing, and go-to-market strategies, Dan Kraus has developed a deep portfolio of experiences that he now uses to help small businesses profitably grow their businesses. As an entrepreneur, Dan understands the challenges of growing a business with limited capital and human resources. As a line of business manager in larger companies such as SAP America and Great Plains Software (now part of Microsoft), his experience launching new business ventures inside reputable organizations established his reputation as a creative and effective executive that could both plan and execute within corporate confines.

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