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Why Do Customers Leave?
Is it quality? Price? Convenience? During our first BGR
meeting in March, we examined and discussed the results of a worldwide
survey that has been conducted every year since World War II. The
results of the survey have been consistent across countries, cultures,
and industries in the 60+ years that it has been conducted.
The survey asks, "Why do you choose not to deal with a business or
to leave a business and go to a competitor?" The answers were
split into five categories, with very interesting results. Of course,
price was one of the factors, but even when it was combined with
product and timeliness, it still totaled a paltry 15%. The biggest
factor, time and again is 'Perceived Indifference' with a whopping 68%
of respondents.
Surprised? At first you may be, but when you step back and think about
your own shopping or dining experiences, is it really such a shock?
Things like the cashier continuing to chat with friends while 10
people wait in line, trying to flag down a waitress, being transferred
from department to department, or being put on hold for what seems
like an eternity.
The survey reminds us that at the base of all business transactions,
customers and clients are all human and need attention.
Second, the survey indicates that 7 out of 10 potential customers walk
away because they felt your business didn't care enough. This also
means that as much as 75% of your marketing budget is being wasted.
Businesses that desire to increase their value must have procedures in
place to ensure that customers never feel that their company is
indifferent. For example, Southwest Airlines has all new ticket agents
in training for 30 days and 30 additional days under close supervision
to ensure that they present the Southwest spirit and that their
customers are treated with respect.
Concentrating on the customers/inquiries you already have is the best
use of your marketing dollars because it costs six times more to gain
a new customer than to retain or sell additional products to a current
customer.
Indifference in your company can be manifested in things as simple as
not answering the phone quickly, not following up on inquiries or
contacting customers and, of course, not thanking them for their
business.
You may find that many differences can be solved with little or no
cash outlay, but it will take a concerted effort by your entire team.
Some changes will require the establishment of new policies,
procedures, and training - all of which are time consuming - but well
worth the effort and your investment in them to retain customers.
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