A New Market? How About Your Ex-Customers?
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Most companies are constantly seeking new market segments as potential customers for their products or services. Rarely, however, do they consider one that can be surprisingly cost-effective: the people who stopped doing business with you.
Focusing on the customers who used to do business with you not only offers an opportunity to grow your business. It can also improve your relationships with current customers.
Most people instinctively avoid rejection, so when a business customer stops calling or ordering, they let it go without any attempt to understand why or recover the business. The simple fact is that customers may leave for any number of reasons. Now, if they became angry or dissatisfied with you, they’re not likely to return. People do hold grudges.
I’m willing to wager, though, that you’ve lost many of your customers for one of two reasons. Some may have been tempted to do business with one of your competitors and then decided to stick with them. As for the others, it may have been that you just didn’t work hard enough to keep them.
Targeting former customers is well worth the effort. They thought well of you enough to do business with you once. They already know who you are and what you can do, so you don’t have to invest a lot of money to explain the basics.
Unfortunately, many people fall into an emotional trap when customers leave for a competitor. They react as though the customer were a wayward spouse, so they become hurt or bitter. But in most cases, their departure really wasn’t about you. It was about them and their perceived needs. Do you think twice about eating at a new restaurant or tossing a bone to a prospective supplier? Do you intend it as an insult to your regular eatery or vendor?
Better not. If you start to treat former customers like a jilted romantic interest, they’re not likely to come back. In fact, if they do consider coming back, your showing a single trace of resentment or jealousy will trigger an irreparable split. Customer service isn’t a romantic relationship, much as you wish it were. It’s a business deal.
The first step in reestablishing any kind of relationship involves one party reaching out to other, and when you’re talking about a past customer, it’s up to you to suck it up and take that first step. Know what? Sometimes, that first step is all you need to convince them to return.
Maybe it’s an email or a quick phone call. Say you haven’t heard from them in a while, and you wanted to check on them. How are they doing? Is there anything they need that you can help with? A share will see it as an annoying intrusion, but most will be touched you checked up on them.
Another way to bring former customers back home is to make them a special offer. And I mean a very special offer, not ten bucks off their purchase of an 8 Series coupe. As you decide what to offer, keep in mind that marketing to people who know you takes a tiny faction of what you’ll need to spend with complete strangers, so you can afford to be generous.
Say you run an HVAC service company. You could drop a note to customers who haven’t been active for two or three years along the lines of: “It’s been a while since we’ve had the opportunity to help you with your home comfort needs. We appreciate your past trust with us, and we hope you’ll turn to us for your future plans. As a way of thanking you for doing business with us in the past, we’d like to make a special offer. We’ll perform a free ‘clean and check’ on your furnace. That’s normally a $129 service call, but because we value your business, we won’t charge you for the service.”
You might protest that you’re giving up $129, but you’re going to make a lot more than that in future business. Plus, your technician might spot needed repairs or discover opportunities for additional components. Since you reestablished the relationship in a friendly, non-threatening way, they’ll be more likely to call when more work is needed, or to refer you to the neighbors.
How can this approach improve your relationships with current customers? Ask your former customers to see why they left in the first place. You can develop and mail a simple survey, or even call them on the phone. Pay attention to patterns in their answers. If half the people you talk to mention that your customer service was rude or your sales reps just didn’t seem to care, you know what you have to do to prevent other departures.
Scott Flood creates effective copy for companies and other organizations. His guide to evaluating freelance creative talent, The Smarter Strategy for Selecting Suppliers, can be downloaded at http://sfwriting.com.