Attracting a new customer can feel like a huge win– after all, countless brands out there compete for their attention. However, it’s important not to close the book once a customer has made it down the sales funnel and made a purchase. Instead, it’s time to turn your attention to retaining existing customers.
Every business will lose some customers for reasons beyond their control, but the aim is to attract enough new and repeat customers to fill the gap and then some.
What do you do when you notice you’re losing more customers than you should be, though? How can you win back customers that were once loyal to your brand?
In this post, we’ll take a close look at some of the most common reasons that businesses lose customers while also exploring the top five strategies for winning them back.
Common Reasons Businesses Lose Customers
What makes a customer stop shopping with a brand they’ve been using for years? Why would a consumer switch companies when it comes to hiring out a specific service?
There are a lot of different things that can compel an individual to seek what they need elsewhere, even if they’ve been a loyal customer for some time. Let’s look at some of the most common reasons businesses lose customers to help you identify why your customers aren’t coming back.
Poor Customer Service
Few things can turn a customer off to a brand faster than a negative customer service interaction. You can have the most eager and excited customer in the world be turned into a lost customer when customer service is slow, inadequate, or downright rude.
Even if your product or service is the best in the business, customers won’t hesitate to walk away when they feel that excellent customer service doesn’t come with the purchase.
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Brand Inconsistency
When your branding and business practices aren’t consistent, you’re likely going to lose customers. Your customers expect consistency when it comes to the products and services they receive, as well as during the billing process.
If refunds are available sometimes but not others, shipping costs are unclear or confusing, or product quality varies, your customers might start to look for the same product or service elsewhere.
Improper Pricing
Another big problem for customer retention is improper pricing. Customers these days are able to shop around online for the best price on a particular product or service, allowing them to get the best deals. When you price too high, you’ll likely find that you’re pushing away potential customers.
On the other end, though, pricing too low will make it difficult, if not impossible, to turn a profit. Finding the sweet spot is essential, and you can entice customers with promotions and deals to bring them into the fold of your brand. It’s important to not just focus on new customers when designing your special offers– repeat customers can end up feeling offended when they no longer receive the perks after they’ve made their first purchase.
Too Much Bureaucracy
Your business needs to have standards and a structure to operate, but your customers don’t need to know about all the rules and policies governing your brand. They don’t want to jump through hoops or experience slow service because of the structure you have set up on your end. They just want you to be available to fix their problems promptly and offer great service.
For this reason, it’s important to keep your business structure simple. Make sure that customers aren’t caught in an endless waiting game because of inefficient processes on your side of things.
Aggressive Sales Tactics
The world of sales has changed tremendously in recent times. In the past, dragging prospective customers through a sales process worked because customers didn’t have much other choice when it came to buying. These days, customers have a lot more information available at their fingertips and are often resistant to aggressive sales tactics.
Rather than using old-school methods to try and strong-arm customers into making a purchase, take the time to gain insight into exactly what your potential and existing customers are looking for. You can then provide strategies that are based on value to suit the needs of your customers and offer them ample space to make a decision.
Under-Delivering
All businesses want to sell their products and services; to do so, they will talk up what they’re selling and promise incredible results.
While there’s nothing wrong with this if your product or service is up to the task, over-promising can end up leading customers to leave when they find out that you’re actually under-delivering on your promise.
Top Strategies to Win Back Customers
Now that we have a clearer picture of why brands lose customers, let’s explore five of the top strategies you can use to win back those that have wandered away.
1. Gather Feedback and Take Action
Before you start throwing money at the situation to try and win back customers you’ve lost, the first step is to learn as much as you can about why they left. Engage with your previous customers and ask them for feedback that will help you identify exactly what went wrong and if there are things you can improve to avoid losing customers the same way.
You might choose to ask your customers to fill out reviews or surveys or reach out via SMS or email. Offering incentives can be a great way to encourage people to follow through and complete surveys or reviews.
It can be tempting to try and guess why you’re losing customers, but if you’re off base, you can invest in areas that aren’t the primary source of customer complaints. The more information you can gather from customers– both existing and previous– the better. Knowledge is power when it comes to winning back your customers, and gathering feedback lets you pinpoint exactly where you need to make changes to retain existing customers, regain old customers, and acquire new customers.
Once you have collected enough information that patterns start to emerge, it’s time to devise a plan for action. For example, maybe you’ve found that there are a number of complaints about poor customer service. If this is the case, you might choose to implement new training programs to help improve the customer service you’re offering.
On the other hand, maybe you find that a pattern emerges where many customers complain about the quality of a specific product or service. If this is the case, it’s time to take a close look at the advice and criticism you’re receiving to see what you can change to ensure your offering serves its intended purpose.
2. Re-Engage Them With Retargeting Ads
Sometimes, customers aren’t necessarily lost; they just get distracted. Countless things are vying for people’s attention, and you might find that you’ve simply fallen off their mental map.
To help remedy this situation, you can re-engage dormant customers by using retargeting ads on social media platforms and your website. You can customize ads specifically for customers that have been inactive for some time based on their purchase history. The more personalized an ad is, the more likely a customer will be intrigued and enticed back to your brand.
As a part of your retargeting ad efforts, consider incorporating promotions or exclusive offers just for returning customers. So many promotions and discounts are geared toward first-time customers, but if you want to promote customer loyalty over time, you’ll want to make sure your previous customers don’t feel left in the dust.
When you design special incentives specifically for returning customers, you can help encourage them to reconnect with your brand and even benefit from a sense of exclusivity in receiving the offer.
3. Revamp Your Brand’s Image
This might not be the right avenue for all companies, but for some brands, a bit of a makeover can have a major impact on bringing back old customers, bringing in new customers, and retaining customers. If you feel that you’ve tried everything to win back lost customers only to find your competitors winning out, it might be time to look honestly at whether your brand’s image is holding you back.
This could mean upgrading your packaging, remodeling your storefront, redesigning your website, updating your logo, or any other manner of things. This isn’t something you’ll want to do on a whim– you’ll want to take a close look at your target audience and determine whether your brand’s image is helping you reach out to that demographic.
4. Provide Outstanding Customer Service
One of the major reasons that companies lose customers is due to poor customer service. About one-third of respondents in one survey said they switched brands after having just one negative customer service interaction, which shows just how important exceptional customer service is.
No matter how outstanding the product or service you’re offering, you will struggle to keep customers if your customer service is lacking. People want to know that you have a team ready and waiting to help out when they have a question or concern. They need to know that you’re there to support them as a customer.
When you think about this, it makes a lot of sense. We’ve all had experiences where we spent far too long on the phone getting passed from one disinterested customer service representative to the next. Or, perhaps even worse, getting stuck in a robotic phone tree that seems to have no path that leads to talking to an actual human being.
These types of experiences can put serious strain on a customer’s relationship with a brand. Investing in training for customer service representatives and ensuring that your employees are incentivized to treat customers right can go a long way when it comes to customer retention.
5. Offer Customer Loyalty Rewards
When you want to encourage customers to return to your brand again and again, one of the best things you can do is set up a customer loyalty rewards program. Loyalty programs give your customers a reason to keep returning as well as a reason to tell their friends about your brand. As you create repeat customers through customer loyalty programs, you also help to increase your reach.
There are lots of different incentives you can offer as a part of a customer loyalty program. For example, you might give returning customers special discounts, free shipping, early access to new releases, personalized offers based on their purchase history, or gift cards.
It’s worth investing time into creating a loyalty rewards program that is specifically designed to fit the needs and desires of your customers. One survey found that more than two-thirds of customers stated that shopping with a company that provides personalized discounts based on their previous purchases, for example, was something they valued.
Loyalty programs are a great way to help your brand stand out from the crowd and ensure your customers know you appreciate them. It can revolutionize how they see your brand, turning them from fairly passive customers to active brand ambassadors. According to one survey, rewards and loyalty points are something highly valued by nearly 60% of consumers.
Ready to Reward Your Customers For Loyalty?
In this day and age, it’s harder than ever to gain and retain the attention of customers. One of the most effective strategies for turning customers into loyal fans is implementing a customer loyalty program. A successful rewards program ensures that your brand is always top-of-mind for your target audience.
So many marketing campaigns focus on gaining new customers and treat repeat customers like chopped liver. You can truly make your brand stand out by offering a customer loyalty program that is specifically designed to show your customers just how important they are to your brand.
Is it time for you to start offering your most loyal customers rewards? Level 6 is an industry leader in the development and execution of customer loyalty programs. Not only will we create a custom program specifically for your company and customers, but we’ll also help you monitor and manage your system so it can be continually improved over time.
Ready to get started? You can schedule a call with us today.
Claudine is the Chief Relationship Officer at Level 6. She holds a master’s degree in industrial/organizational psychology. Her experience includes working as a certified conflict mediator for the United States Postal Service, a human performance analyst for Accenture, an Academic Dean, and a College Director. She is currently an adjunct Professor of Psychology at Southern New Hampshire University. With over 20 years of experience, she joined Level 6 to guide clients seeking effective ways to change behavior and, ultimately, their bottom line.
