You assume your small business has everything in place to draw an abundance of customers but for some odd reason it isn’t happening. What’s more, prior customers are not coming back. You look at the business process and it just does not make sense…
Why am I losing customers?
Is it time to call a meeting and start blaming employees? Let me just tell you “instead of blaming employees, look in the mirror.” But this is no time to blame; you know the problem is customer retention and it is time to solve the problem instead of dwelling on fault.
I have been working with small businesses for many years and I know that the reasons for customer loss can be from a variety of small or large issues that can be hard to recognize from the inside. You need to use “customer eyes” to see the reason they are choosing to use your competitor.
I am going to take you through the most common reasons small businesses lose customers and what you can do to solve the problem.
Why Am I Losing Customers? – Employee Turnover
People buy from people… Yes, you have a great product or service but no matter how great it is, the customer is buying it from, and through your employee. If they build a relationship with that employee and suddenly that employee is not working there anymore, your customer is not buying from you anymore.
Your employee base is as important as your customer base. If your employees are happy and satisfied, your customers are also happy and satisfied.
Recognize employees for their great accomplishments and if you must rotate or are promoting that employee, be sure they have the opportunity to tell the customers they have built relationships with.
Why Am I Losing Customers? – Inconsistency
If you study the successful businesses who keep a strong customer base, you will find they are consistent with everything.
- They have consistent hours of operation.
- The company’s marketing runs on a consistent basis.
- They consistently add new products or services.
- Consistent pricing.
Consistency keeps customers!
Why Am I Losing Customers? – Hard To Contact Customer Service
If a customer wants a question answered, to return a product or to make a complaint and has no success in reaching someone, they will shop elsewhere.
- Livechat says 7 AM – 11 PM Mon-Fri and it’s 9 AM Tue; why does no one come on?
- The customer service line at the store has 6 people and a sign that says “At coffee break.”
- The customer dials the toll-free number and pushes all the right buttons. After 15 minutes, the system just hangs up on the customer.
Customer service is the “lifeblood” of your business. Listen to your customers and make sure your customer service is top-notch.
Why Am I Losing Customers? – Not Rewarding Loyal Customers
I would predict that 70% of businesses are using loyalty reward systems. If your business is not rewarding loyal customers in one way or another, your customers will go where they will be rewarded.
There are many ways to reward loyalty.
- Special coupons
- Money off after so many purchases
- Birthday rewards
Why Am I Losing Customers? – Treating One Customer Different Than Another
This is a common reason that small businesses have lost customers.
As an example, let’s say you own a used car dealership. Your salesperson is in the shop and a person drives in with an old pickup and they wear work clothes. 2 minutes later, another vehicle drives in. It is a BMW and the man driving gets out wearing a suit and tie.
The salesman immediately goes to the suit and tie, but the other person was there first.
He gets in his pickup and drives over to the competitor across the street. You watch as the person with the pickup drives away from the other lot with a new truck that was priced at $31,000. You also watch your salesman go nowhere with the guy wearing the suit and tie and he also drives across the street.
You cannot discriminate or judge any person by what you see outside. Treat all customers like kings and queens and fairly.
Why Am I Losing Customers? – You Are Not Flexible
Flexibility is how some businesses stand tall against their competitors. Many customers are more than willing to pay a premium just to “get it how they want it.”
We deliver in a 30 mile radius
The customer says they live in a town that is 63 miles away. They have no other way to get that furniture your store sells delivered.
Will you work with this customer? They ARE willing to pay extra if you will deliver.
Flexibility can win you that customer… And many more!
Why Am I Losing Customers? – Pricing
It is important that you research how your competitors are pricing similar items.
Over-pricing can lose customers if you cannot show the added value and benefits.
Under-pricing can be even more damaging. You may think that you are giving a great deal but customers will automatically assume that your product is inferior and will go bad quickly.
Remember to be clear with customers the benefits they will receive and what your product will solve in comparison to the competitor’s.
Why Am I Losing Customers? – Customer Relationships
Just staying in touch with your customers is a key method of customer retention.
- Send newsletters…
- Birthday or Holiday cards…
- Check in to see how the product is working…
- When you see a customer elsewhere, acknowledge them…
Just showing that the person is more than just a wallet with money will keep them coming back. Build a relationship and your will not lose customers, you gain friends.
Why Am I Losing Customers? – Pushing Instead Of Suggesting
There is nothing wrong with attempting an up sell on a current customer. But there are right and wrong ways to do so.
A key factor is knowing the customer and what problems they are trying to solve. Offering a suggestion as to what has worked for other customers is much better than telling the customer they absolutely need that item too.
Customers do not like being pushed but they will always listen to suggestions.
Why Am I Losing Customers? – Not Listening
You need to pay attention to past, present and potential customers. I say listen, but that does not entail using just your ears. It means using your eyes too.
Social media is full of listening opportunities. You can discover a lot about customers and how they perceive your business and your products.
Remember that with the internet, consumers interact regularly. And people trust the reviews others give on products and services.
So listen, learn and satisfy your customers.
Why Am I Losing Customers? -Not Using Technology To Its Optimal Level
If the technology you are using to manage customers is outdated, slow and provides a terrible customer experience, those customers will leave.
You need to ensure that customers are able to go through the checkout, customer service or any other process with simplicity, speed and ease.
Today’s customer expects an easy to use system that is fast. Customers have busy lives and do not want to wait long or have issues when trying to pay for an item they want.
Staying technologically advanced with your business will keep customers.
Why Am I Losing Customers? – Not Adding New Products Or Services
Boredom is a huge reason customers will leave. Adding new products or services is a key method to stop customer boredom.
Make sure and “yell it from the rooftops” when you do add new products or services. Keep boredom at bay and you will keep customers.
Why Am I Losing Customers? – Customer Impressions
Cleanliness and upkeep is another important aspect in customer retention.
Do customers look at the outer view and feel comfortable going in? Does it need paint? Is parking a hassle? Is the entrance inviting?
And when the person comes in, do they feel happy or is it stressful? Certain colors invite sales while other colors can chase customers away.
Store setups need to be easy. Customers do not want to be forced into working to find what they need.
Consider happy pictures, flowers and plants and even the clothing employees wear.
Why Am I Losing Customers? – Improper Employee Reward System
If it is more rewarding for an employee to sell to a new customer than to a previous customer, that employee is going to go after the reward. And in doing so, you will lose previous customers.
Training your employees in retaining long-time customers while also attracting new customers is a key task you must master.
Find a reward system that ensures you are covering both sides of the equation.
Why Am I Losing Customers? – Not Accurately Answering Customer Questions
Never should you “fake” an answer to a customer question. Always be honest and if you do not know the answer, tell the customer you do not now, but… I will find the answer. You may be able to call someone then and there or get the customer’s contact information and tell them you will get an answer and by all means, contact them immediately when you do get an answer.
Do not tell the customer what they want to hear, give them the truth.
Yes, that customer may not buy that particular item but they will remember your honesty and how you bent to answer the question.
Odds are, they will come back and buy other items from you.
Why Am I Losing Customers? – No 3rd Party Validation
If your business receives an award from the Chamber of Commerce or another 3rd party source, frame it and put it in your business.
When you receive news coverage, post it. Do you have testimonials from well known people? Show them.
While you may think customers don’t see these 3rd party validations, they do!
And they do build confidence and trust in your small business.
Why Am I Losing Customers? – Improper Marketing Methods
Certain images and words used in marketing have done the opposite from the intention. I could find thousands of examples where businesses actually lost customers from their marketing methods.
Before using any marketing method, consider how current and previous customers will perceive it, as well as potential customers.
Case in point: you offer a 30% off for new customers only… Won’t loyal customers feel discriminated against?
Why Am I Losing Customers? – Not Admitting Wrongs
This goes right along with bad customer service. But I had to “dive deeper,” because I see this as a huge problem with many businesses.
No, it isn’t fun when you know you made a mistake and are in the position to apologize. But so many will not admit, instead blaming something else or even the customer. Just own the mistake and say “I’m sorry,” even if you are not sure who, what or why.
Most customers will gain a lot of respect if you just admit and fix it. They will lose respect even if you fix it, but do not apologize.
I believe if you really look deep at your business and see if you are making any of these errors, you will start retaining customers.
We at Vionic are in the business of helping small businesses gain new customers and retain previous and current customers. If you have not yet reviewed how we can help your small business, I suggest you take a close look here.
And with that, I want to give you this free guide: The Ultimate 10 Step Guide To Tripling Sales Using Facebook.
Let’s help you grow your small business to great heights.
Have a great day!