Lost Customer Retrieval Project

A pilot test of this process will be conducted by the Houston Source Office

In the current business environment, where acquiring each new customer takes significant investments, customer retention has never been so important to our financial health. We all know that lost customers are many times more likely than happy customers to share their bad experiences with friends and colleagues. We need to track those reasons so that, once we understand what has caused customer defection, we can take intelligent steps towards improving our current customers' experience and thereby increase our overall customer retention rate.

Traditionally the top reasons that customers leave us tend to include:

• Service issues (e.g., bad service or disputed service)
• Pricing issues (i.e., too expensive)
• Better offer from competition
• Client staff changes, or
• Product or service no longer needed.

The mission of this project is to contact as many former customers as possible and answer two fundamental questions – why did they leave us, and what can we do to bring them back?

This project consists of a five-step process:

1. Create list of lost customers
2. Research previous relationship
3. Make the non-sales survey call
4. Send a follow-up letter
5. Re-establish a sales effort

Step 1 – Create Lost Customers List

The first thing we need to do is get a list of these customers and the appropriate contacts.  We should be able to do this using historical sales data (available from accounting), 4D and a little grunt work.  This should be done by collaboration between David and an administrative person.

Step 2 – Research Previous Relationship

The second thing we need to do is get all the facts. See if we can ascertain their reason for leaving, and to do this we need to do some basic research.  Before ever calling the customer, try to answer the following questions through internal investigation:

1. Why did they do business with us in the past?
2. What did they like about our company?
3. What didn't they like?
4. What did they buy from us?
5. How often did they buy from us?
6. Why did they leave us?
7. With whom do they do business now?
8. How do we compare to the company with whom they now do business?
9. How can we provide them with the same relationship they had when they did business with us.
10. What enhancements can we add to the answer to question 9?

Step 3 – Make the Call

After gathering as much of this information as possible and having it at your fingertips, it is time to call the customer.  This can be done by any non-sales person that has a friendly, out-going personality and can represent CleanAir.

The tone of this contact is vital – the caller should remain neutral at all times. Never be aggressive or defensive. The caller’s sole purpose is to discover why the client left so that we can fix the problem and prevent it from happening in the future.  Go through each of the 10 questions above with the client.  In addition, add the following questions:

11. Answer questions 2-4 about their new provider.
12. What would make them switch companies now?

Step 4 – Follow-Up

Send them a personalized letter thanking them for their time, and list all their reasons for leaving in bullet points. Underneath each reason for defection state the corrective action we have taken or plan to take.

Step 5 – Re-establish Sales Effort

After we have fixed any internal problems or matched the competitions’ offering, we are ready to re-establish a sales effort with this client by involving our sales staff.  This starts with a warm-up contact (JR or other sales person) – an acknowledgement that we value their business and have remedied whatever caused them to leave us in the first place. Then move into a cold sales process. Treat them with great respect as if they are the only client we want. Be sure to ask what they would expect in a new relationship with us, and be prepared to give it to them with some guarantees of how we will deliver (or how they will be compensated if we don't).