Article

Why Customers Stop Using Your Services And How To Prevent It

Published November 9, 2021
Last updated November 9, 2021

Securing customer loyalty and attracting new clients is vital to every successful business. But the balance has to be right. When a business attracts fresh customers at the expense of existing clients, the net gain is zero.

This blog will answer the question: why do customers stop using your services? We’ll also show you how to keep customers from leaving, with four simple insights that could change your business for the better.

Why do customers leave?

First of all, the reasons for losing customers are numerous and varied. These can include feeling taken for granted, finding better alternative options or bad customer service. Central to these three examples is the customer experience. Getting this right will prevent customers from leaving and even encourage repeat purchases.

Staying in touch with your customers demonstrates that you are not taking them for granted. This can be achieved through hand-written notes, newsletters, social media, special personal offers and even the occasional check-in call from customer services.

Preventing customers from switching to a cheaper alternative option is a bit more complicated. But it’s worth noting that 67% of UK customers claim they are happy to pay more for a better experience. If you offer outstanding customer services your clients will see those cheaper deals from your competitors, but ignore them.

Finally, businesses that keep their clients happy, keep their clients. Research published by Forbes shows that 96% of US customers believe that good customer service influences their brand loyalty.

Saying that, even a bad customer experience can be turned into a positive experience if you know how. A messed up delivery, a missing item in an order or a faulty product. If handled properly with the right amount of care, you can maintain the relationship and retain a loyal customer.

Avoid leaving out your existing customers

Contrary to popular belief, customer acquisition campaigns can harm the morale of existing customers. When these customers feel they are getting a raw deal compared to a new one, they might choose to look elsewhere.

Utility companies, publishers and even food delivery services always offer enticing offers to get customers on board, but then what? The free tote that came with your magazine subscription is great. But what happens when the customer is invited to renew their subscription?

Discounts on a first order set a perception of value that can make the full price second order less appealing. When you win new business with incentives and discounts, be prepared to continue offering incentives to maintain your customer retention rates.

An existing customer is 60-70% more receptive to any offers you might send out. With a new client, the chances of conversion are as low as 5% to 20%. This includes renewing subscriptions or encouraging them to continue spending with you.

Businesses that master how to win and keep customers balance the demands of new conversions with the expectations of their existing customers. Perhaps regular offers for everyone is the best way to go. Three-quarters of all consumers say they favour companies that offer regular rewards.

Consider different incentives throughout the lifespan of your customer. From a special introductory offer to gifts and extras that introduce them to other products or services. Finally, consider loyalty programs that reward ongoing orders. Choose simple measures to prevent losing loyal customers and help generate future loyalty.

Manage expectations and overdeliver

One of the main reasons why companies lose customers is that they fail to manage expectations. The perception of a single bad experience can be devastating with 32% of all customers saying they would ditch a brand immediately. These include customers left waiting for follow up communications or sitting at home expecting a delivery that never arrives.

Speaking at a Zendesk Showcase in 2019 Entrepreneur and Founder of RXBAR Peter Rahal advocated a strategy of over-deliver to secure trust. Companies that make promises have to keep them or risk creating a perception of bad customer service. Repeat customers are customers whose expectations are properly managed.

For example, a shopper that was promised their order would be available for collection at 10am has to wait for 10 minutes. The issue here isn’t the delay but the fact that a promise was made. The inconvenience might be slight but the promise underscores it and magnifies it, ultimately eroding trust in the brand.

A better scenario would be telling the client their collection is available between 10am and 11am. Then, overdeliver by sending them a message at 10am to say the item is ready for collection. By managing better expectations and over-delivering you can shift the perception of their experience and help retain this person for life. Through constant effort and innovation, you can learn how to keep your customers coming back.

Keep innovating and keep it interesting

For each person that can happily eat the same sandwich every day, there’s another who craves constant variety and novelty. In business, half of the battle to retain your customers is to keep customers interested.

In 2019, the Canadian coffee shop Tim Hortons released a new gamified loyalty app to the delight of their customers. The same year, BMW used augmented reality to allow customers to virtually see under the hood. The app experience revealed the hidden features that make the cars so exceptional.

Shoppers are emotional beings who seek out emotional connections. Innovations that ignite interest and awaken their desire for novelty are the foundation of long term customer loyalty and retention.

Most of all, encourage customer feedback and listen to that feedback. Your return customer knows your brand and can tell you what they love and what can make it better. If you increase engagement and empower them to help you shape the brand, they will remain loyal forever.

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