Some angry customers just want someone to listen. Ruppert Landscape has prepared a reference card for handling customers with complaints. It's stuck to every employee's phone. Step one: Thank them. "That surprises customers," says Chris Davitt. And, as a dentist, Dr. Beshar sees a lot of "anger and fear" enter his office. "We are therapists here, and I love it. I ask people to voice their worst fear, and then I make sure it doesn't happen."
ClichÉ: "If you win back lost customers, they're yours forever."
Forget it; you still have to prove yourself every time. This customer-service truism persists because it's such a comforting notion. One thing's for sure. Leaving "is a great way for a customer to get attention," says Riggs.
Lost customers sure do look like good prospects. And sometimes they are. At the Texas accounting firm of Carneiro, Chumney, the partners telephone clients who've canceled. "It's not a favorite activity of ours," admits managing partner Bob McAdams, who says client turnover is about 5% of its list of 2,500. "But we try to find out why. We want to leave them thinking we were not only gracious, but we would welcome them back. We have won some back, but it's never forever. One client constantly asks, 'What have you done for me lately?"
But will you respect yourself in the morning? Some lost customers should stay lost. Dentist Marc Beshar wants patients who enjoy being a part of the practice. He does treat emergency walk-ins but isn't surprised -- or hurt -- if Mr. Rotting Teeth never returns. "I need fewer patients than other practices need" to be profitable, he claims. "I've tried to focus on patients who value what I'm doing. What's left is a committed practice."
"We look at customers as closely as they look at us," attests Team One Plastics' Craig Carrel. "Are they quibbling over charges? What's the state of their technology? Are they forward-thinking? I don't want to work with customers who won't be around in 10 years. If they're not competitive, they might lose their business. Then we lose our time and development."
CEOs agree: the worst is to lose a customer through some fault of your own. "I always try to win those back," says Topique Associates' Bess Herzog. But she adds wistfully, "Usually, customers who are unhappy with me aren't nearly as unhappy as I am with them." She lets go of those -- permanently.
Even if you don't want them, you should care about how they leave. "Customers are out there talking, and they're not telling your side of the story," Herzog points out. "As much as possible, you need to leave them feeling as if they've won. Sometimes I drop a bad debt. I have to ask myself, 'How much is this $200 going to get me?' "
ClichÉ: "The return on the customer-service investment can't really be measured; you just have to do it."
True for the most part, but you sure can feel the difference in your business. Says Jeff Thompson of Peripheral Outlet: "We find out how well it works when a customer calls on a Friday afternoon and says, 'Your competitor told me they could get me this by Monday, but I don't believe them, and I know you will. So you get the order even though you're more expensive."
But it's the best way to gain control of your sales cycle. Carneiro, Chumney hooks 60% of its new clients on the strength of current clients' recommendations. Advertising, a poor second, pulls in only 20%. "With referrals, we're often the only firm they are considering," says McAdams. "They are already convinced." All that's left is to "confirm what they've already heard."
Contract Manufacturers has never needed a sales force. "I don't do a lot of advertising," says Ron Jackson. "I've never done telemarketing. I wouldn't know how." Contract has 90 active dealers and didn't solicit any of them. In fact, the company turns down about five dealership requests a week.
At the least, you can track your customers' growth. "You can measure the return on customer service through overall sales growth and also growth in pieces per customer," says George Riggs. Embroidery Services' average first-order size has increased from 24 pieces to about 42.
Team One Plastics has watched many accounts grow to $100,000 from initial sales of just a few thousand. In the five years they've been buying from Team One, two customers have grown to be worth $1 million in annual sales. "So we never say this is just a $10,000 customer," says Craig Carrel.
The investment in customer service will make its way onto your balance sheet; count on it. Lorraine Miller of Cactus & Tropicals has built up some 15 years' worth of assets and goodwill. Started with just a few thousand dollars, the tiny shop has blossomed into five greenhouses, a gift shop, and a huge parking lot. The profits that came with a devoted clientele allowed her to reinvest in property. "I'll have a good business to sell when I retire," says Miller. And if you believe, as the sages say, that a good customer list is your most valuable asset, then Miller's hometown list of 5,000 is worth a bundle. She typically gets a 10% response on direct-mail offers.
ClichÉ: "It costs three times as much to gain a new customer as it does to keep an old one."
The new math just doesn't add up. This pop statistic from the conference circuit alludes to the high cost of mass mailings and face-to-face sales calls. But really, if you're not mailing to a million anyway, what's the point? "I look at everything I do as getting new customers. It's not a cost," Miller protests.
