Is your business losing customers? It can be an expensive proposition. It costs less to do more business with current clients than to bring in new ones. In other words, failing to retain customers is one of the biggest liabilities your business faces.
This article explains why customers could be abandoning your business and what you can do to turn things around.
1. Staffing Changes
Customers often patronize small businesses because they become attached to their people. If you have high staff turnover, it could be the reason customers aren’t returning. The people they love to work with aren’t there to meet their needs.
How to remedy staffing change issues:
If you have high staff turnover, survey employees to find out what’s happening and fix it. Not only will this help with your customer loss issue, but you will also save money on recruiting and training new employees and reduce the amount of organizational knowledge and experience employees who leave take with them.
Build “many-to-many” relationships with all your key clients. This will help prevent them from becoming too attached to a single representative and taking their business elsewhere should they leave.
If a key employee decides to leave, ask them to work with their clients to make a smooth handoff to someone else.
2. Limited Product or Service Needs
Sometimes, clients only have a limited need for what a business does or offers. For instance, a company may only need the services of a contractor when it builds a new location or renovates one.
How to remedy issues related to limited needs:
Develop additional products and services adjacent to what you already offer that meet recurring needs. For instance, the building contractor in our example could provide ongoing maintenance and repair services after their development or renovation projects are complete.
Ask for referrals. Even if clients can’t use your services again, they may be able to recommend others who could.
3. Client Fatigue
Sometimes, a business-client relationship has a few good years, and then things begin to decline. The client may tire of the relationship or want to explore their options.
How to prevent client fatigue:
Treat old clients like new ones. Don’t settle into lethargy. Always bring the same energy, enthusiasm, and excitement to every interaction. Constantly come up with fresh insights and ideas. Make it a point to demonstrate value in everything you do. Never take anything for granted.
4. Lack of Budget
A lack of budget is one of the most common client retention issues, especially in challenging economic times. Companies or people must reduce expenses when times are tough, and your business might not make the cut.
How to prevent your company from getting cut when budgets are strained:
Always be able to prove how your firm is integral to a client’s profits, growth, and future innovation.
You must clearly connect what you do with your client’s business goals.
Regularly communicate the value and impact of your work.
5. Quality Issues
It’s possible to lose clients for two different quality-related reasons:
Actual quality. You deliver a product or service that is not good quality.
Expected quality. You provide a quality product or service, but it does not meet client expectations.
How to prevent losing business because of quality concerns:
Regularly solicit client feedback and act to correct any problems you uncover.
Always agree on expectations at the beginning of a project or engagement and prioritize meeting or exceeding them.
Build transparency into your client experience so they can see the effort you put into your work.
6. Bad Personal Chemistry
Likability is a key factor when deciding who to do business with. If a customer has a bad experience with you or an employee, they might not want to come back for more.
Here are some proven ways to avoid losing repeat business due to likability issues:
Become a good listener. Pay attention, affirm, and ask thoughtful follow-up questions. Customers are more likely to find you appealing if they feel heard.
Consistently express appreciation for the opportunity to serve your clients.
Take time to understand how your client would like to structure and manage the relationship and how they prefer to communicate.
7. Loss of Trust
It’s almost impossible for a business to regain customer trust once it has been broken, and no one wants to engage with a company they don’t trust.
Here are proven ways to build client trust so they do repeat business with you:
Be competent. Consistently meet or beat customer expectations.
Demonstrate integrity. Always be honest, reliable, consistent, and discrete.
Focus on the client. Pay as much — or more — attention to client interests than those of your business.
Provide enough facetime. Clients are more likely to trust you if they spend enough quality time with you.
Keep More Customers: The Bottom Line
The one thing all the reasons businesses lose customers have in common is complacency. When businesses don’t provide real value to their customers, clients stop seeing the benefit of working with them.
It’s critical to treat every client like a brand-new piece of business. Focus on delivering genuine value to every customer every day and ensure they feel that you’re doing so.