101: WINNING BACK CLIENTS
Businesses can be plagued by churn, or how many customers cancel. Those companies include insurance companies, gyms and online streaming services. For all businesses — even those without high churn rates — winning back lost clients is a skill worth learning. Here are three reasons to focus on bringing them back into the fold and not replacing lost clients with new ones:
Understand that if you lose them, their information goes, too. That data, said V. Kumar of Georgia State University in an article by Angus Greig at Harvard Business Review, is needed to design an effective win-back proposal. Marketing costs need to come into play all over again if you're starting anew. Also, you know they need what your company's selling. “These people have demonstrated a need for the service, making them far better prospects than random names on a cold-call list,” said Kumar.
Find out what happened. Dave Mattson at Enterpreneur.com said this exercise takes objective listening and tough soul-searching. “Conduct a strengths, weaknesses, opportunities and threats (SWOT) analysis,” after speaking with the customer and sales representative to fashion a solution, he said. This process – fixing what's wrong – will help with overall sales.
Don't assume getting them back is always best. After you've investigated why the client is leaving, see how it matches up against your business model. If it's more than a simple issue – more of a systematic mismatch – you may be better to let them go. “Suppose the problem is lousy customer support,” writes Geoffrey James at Inc.com. “If your business model depends upon providing low-cost (and therefore minimal) customer support, you'll either need to change that business model or carve out an exception for this customer. Is it worth the effort and hassle?”
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