The Loyalty Of The Customer

Customers make an interesting study. It seems that they always want the very most for the very least they’ll have to pay. They are ruthless, selfish, demanding and disloyal.

You know the story. You’ve done business with someone for several years and they’ve been good customers. You’ve given them the best service possible and you think they are your customers for life. But then some little thing possibly out of your control goes wrong, or they see an ad or get a call from a competitor, someone they’ve never met before, with a slightly lower price, and the next thing you know, they are gone, oftentimes without a single word to you.

At first you don’t notice it. But one day you realize that it’s been a while since you’ve seen or heard from that customer. When you find out what happened you feel badly because if they would have just called you, you might have been able to make a couple of changes and save the business. But it’s too late, they’re gone.

This scenario is repeated time and again with businesses owners from every kind, size and type of company that sell every type of product or service available. It is going to happen and it does happen. To pretend that it doesn’t or won’t happen is simply deceiving yourself.

It’s incredible how many business owners just write off the loss of a good customer. But that’s not the thing you should do. Instead, now is the time to become even more proactive and go after your “lost” customers – those who have done business with you in the past, but for some reason are no longer patronizing you.

At one time they liked you, trusted you and believed in you enough to give you their money in exchange for some type of value you could provide them. It may be that they still need the products and/or services you offer, but now they’re getting them elsewhere. What happened? Why are they still not doing business with you? Why did they move on to another supplier or vendor? Understanding the reasons people are no longer doing business with you, and then taking action to prevent the defection of your current customers and regain your lost customers can put a LOT of money in your bank account.

Why Customers Quit

Some years ago a study was done on the reasons customers quit. They found that…

1 percent – die
3 percent – move away
5 percent – develop other friendships
9 percent – competitive reasons
14 percent – product dissatisfaction
68 percent – indifferent attitude of employee

The study was good as far as it went. But there are other reasons that people stop buying from a business. People’s lives change over time. As their children grow, get older and leave home their housing and other family related needs change. Job, career and hobby interests also change with time. And as those changes occur their need for certain products or services also change, and for the business that offers those things it may mean a loss of customers.

Another reason that people stop doing business with a company or organization is that they get out of certain habits. A loyal gym member who returns from an extended vacation may find it difficult to get back in the “groove” and start working out again.

The important point to all of this is that people stop doing business for a variety of reasons – most of which are preventable. There’s not much that can be done about those who die or move away – or even those who no longer have a need for your products or services. But the numbers of those who fit those categories are very small. It’s the other categories that for the most part are very much within your control and capabilities to save.

How To Stop Customer Defection

The easiest way to prevent your customers from leaving you and defecting to the competition is to let them know that you care about them. Customers are very much like spouses. If you don’t tell them you love them once in awhile, someone else will and you’re likely to lose them. You have to continually keep in touch, communicate with them and let them know that you appreciate their business and that you value them as individuals. People don’t buy from businesses. They buy from other people. And the more you can make them feel appreciated and needed the more responsive and loyal they’ll be to you.

Reselling your customers on the reasons they bought from you in the first place is one of the best ways to cut down on defections. Regularly scheduled meetings or conversations with your customers to remind them of how you came together and what their motives were to initially buy from you can go a long way in helping insulate your business from the competition.

Remember that your competition has similar products, services and prices. Also remember that your customer’s reasons for buying are only 35 percent based on those products, services, and prices. The other 65 percent is for what you can do for them.

The more you can do for them beyond what the actual product or service they buy from you does, the more you’ll build value in doing business with you rather than them buying from you because you happen to carry a particular product or deliver a certain service. Review your customers’ needs, wants and concerns. Remind them why they bought from you in the first place. Reinforce their motives, and their decisions for buying, and you will reduce your customer defection rate and develop not only loyal customers, but friends, as well.