Oftentimes, you don't know that a client or customer is leaving until it's too late. But there are early warning signs that may tell you if customers are getting ready to jump ship.
Here are some red flags that can indicate whether a client is going to remain loyal or head to the competition:
The most obvious sign of an unhappy customer is the customer complaint. The initial problem is only the beginning.
Your customer also might be unhappy with the way the problem is resolved or service was provided. Companies should track complaints from the first call to the resolution, and make sure that customers emerge from the process happier than when they entered. Also watch for recurring problems.
If your company is receiving numerous complaints about the same product or service, then there is a good chance you're going to lose customers.
When a customer returns a product, it is another early warning sign that a customer may be ready to give up on a company and start looking to its competitors. Not all the reasons for returning products are negative. Sometimes your customer makes a mistake or orders the wrong size. Good customer service employees keep a close eye on returns, and they track the reasons products are returned. Watch for trends -- product defects, misinformation during the sales process, poor packaging for shipping, etc. Most can be fixed quite easily to prevent customer dissatisfaction.
When clients are complaining or customers are returning products, at least they're in touch with the business. No contact at all can be a warning signal. If a customer fails to respond to a customer survey or return your calls, the business has cause to worry about customer retention.
A lack of response can take many forms. For instance, if clients are taking longer to pay bills, companies should treat the situation as more than a receivables issue. There may be issues with your products or services that caused them to put you at the bottom of the pay list.
If you see a serious decline in purchases or request for services from a regular customer, it's time to place a call. Ask open-ended questions: "What could we do differently to make it easier to do business with us?" "What would you like to see us do more often?"
When a customer makes repeated calls, it may indicate that there is weak follow-through on service requests. But keep in mind; if your customer bothers to call back, it's an indication that the relationship can still be salvaged. The customer is still willing to work out the problem with you.
The more you stay in touch with your clients, the more you'll be aware of their feelings about the company, products and service. Each time you speak with a customer, you have a chance to strengthen the relationship or win back their loyalty.
• Debra Schmidt is learning and development manager at MRA -The Management Association.