"Our Take" - Six Steps to Losing Your Customers

(Past Editions by: Date, Title, Topic)

 
About "Our Take" 
"Our Take" is a collection of daily vignettes covering a wide range of CRM topics. It's an attempt to add our own spin to the world of CRM. We will use the column to share our perspectives, opinions, epiphanies, web nuggets, or quite frankly anything that moves us. Get ready to expect the unexpected. And, don't be shy about sharing your thoughts.
 
 
12/16/05 - Six Steps to Losing Your Customers - Step 1
Over the last year, I have often used this column to talk about customer retention. It's a safe bet that you will see even more in the coming year.
 
I read an article in B2B Marketing Magazine that had a sidebar entitled "Six Steps to Losing a Customer." Allow me to share them with you. Today, we'll tackle step one: "Wait for the customer to complain or ask for additional services. Most will simply go elsewhere."
 
If you are waiting for the customer to speak up, you're too late. Studies have shown that 90+% of customers with an issue don't complain. That means that your complaint department only sees the tip of the iceberg.
 
Gary Lemke, Publisher
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12/19/05 - Six Steps to Losing Your Customers - Step 2
It's not quite the 12 days of Christmas but knowing the Six Steps to Losing a Customer might be a bit more useful to you - at least as it relates to keeping your customers in the fold.
 
Step 2: Assume that the customer is happy and will renew your service or use you for additional requirements. We have all been taught the pitfalls of assuming too much and that lesson remains very important for those in the customer relations business.
 
Does your organization "throw products over the wall" and blindly believe customers will be happy enough to buy more? During the year, we talked about the importance of metrics like customer retention, net promoter, customer satisfaction and others. Can you ever measure too much?
 
Gary Lemke, Publisher
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12/20/05 - Six Steps to Losing Your Customers - Step Three
Do you consider your competitors' customers prospects for your products and services? It's a good bet they consider your customers prospects. So step number three for losing customers is:
 
Forget that your existing customer is somebody else’s prospect. Your competitors are doing all they can to attract your customers and you need to give your customers a good reason to stick with you.
 
Does your value proposition make it difficult for your competitors to steal your prized possessions? You have home field advantage - customers are already playing on your field by your rules. Are you taking full advantage of it? Are you creating switching barriers to keep customers from leaving?
 
Gary Lemke, Publisher
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12/21/05 - Six Steps to Losing Your Customers - Step Four
Should a CRM initiative ever be a cost saving program? Yes, when it saves the customer money. Often, but not always, when you are looking to cut costs. Step number four of six is a very common way companies lose customers:
 
Focus on cost savings at the expense of providing a quality service. There is no point in automating processes and marketing campaigns that don’t work for the customer. How often do we see organizations looking to squeeze costs out of operations only to see a rise in customer complaints and defections?
 
As a general rule, cost saving initiatives should be done using two-dimensional metrics: save x% while maintaining or improving the customer experience. A singular focus on cost reduction runs great risk of making your customers mad. Be careful!
 
Gary Lemke, Publisher
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12/22/05 - Six Steps to Losing Your Customers - Step Five
I wish I had a nickel for every time I heard some one say, "We have a problem working with our customers but that problem will go away once we install our new CRM system." That brings us to step number five of six on how to lose customers:
 
Expect a CRM system to retain your customers all on its own. People buy from people, not from emails, no matter how well segmented.
 
Software doesn't solve problems. People solve problems. Software can help people solve problems. It's not that CRM systems can't help, they can do marvelous things. But they aren't the silver bullet that takes care of all the other hard work.
 
Gary Lemke, Publisher
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12/23/05 - Six Steps to Losing Your Customers - Step Six
A chain is only as strong as the weakest link. Every cog in the machine is important. True enough in mechanics as well as CRM. The sixth of six steps to losing a customer is:
 
Fail to recognize the bearing that the attitude and behavior of every single employee in your organization has on customer retention.
 
Many studies show a direct link between employee retention and customer retention. The connection is undeniable. Furthermore, just because certain employees don't interact directly with customers doesn't mean they don't have a direct impact. Every employee has the opportunity to make or break the customer relationship.
 
Gary Lemke, Publisher
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1/3/06 - Happy New Year
I ended the last six days of 2005 with six ways to lose customers. You can review those six steps by visiting the archive of "Our Take" articles.
 
If I were to summarize those six steps in to one piece of advice that advice would be to not take your customers for granted. Stay connected to your customers. Understand their wants and needs. Invest in their success. Figure out how to do it better than anyone else.
 
So that is my New Year's resolution to you. We don't want to take you for granted. So tell us how we can make our daily email newsletter more useful to you. Tell us what you need, what you want, what you like and what you don't like. We are listening and we will do our best.
 
Gary Lemke, Publisher
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