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Marketing

8 Issues that May Cause You to Lose Customers

“If it weren’t for these customers, we would be doing just fine!”

We have seen this pattern repeat itself far too many times. Few people are in the habit of looking for a gap in the market or trying to identify an unsatisfied need.

Successful startups grow by building a product or service that meets the needs of customers. As a result, the business may flourish from a small team of employees with a handful of loyal customers to become a major company with thousands or even millions of customers. Over time, the executives get so engrossed in running the day to day operations of the business that they forget that the purpose of the business is to serve it’s customers. They may even start to see the demands made by customers as a hindrance to the smooth running the business.

Lack of customer focus results in disgruntled customers which ultimately results in them switching to competitors. This marks the death knell of the company unless it gets a wakeup call. It is hence important to identify signs of lack of customer focus early on. Below are eight indicators to watch for, along with a few anecdotes.

1. You tell the customer what to do (or what not to do)

There are a number of companies that make the customer change their way of doing things to accommodate the company’s needs or add restrictions on the customer in order to save a few bucks. A good example is Aroma, a high-end coffee shop in Canada, which in some of it’s locations has notes on the tables restricting where customers can sit and for how long they can use power outlets. This creates a very unwelcoming experience for customers. Especially for those customers who prefer to work with their laptops while sipping coffee. This is bad for the company whose business model is based not on selling coffee but on selling an enjoyable experience and for providing a third place between work and home.

2. You treat doing your job well as an imposition

Over time, as the number of customers increases to a point which is beyond the company’s ability to serve them, the company’s employees start behaving as if they do not need the customer any more. The customer service reps must not be trained enough or must be unhappy with their job to behave in this manner.

3. You make the customer deal separately with different stakeholders or departments

One of the big five banks in Canada, Scotiabank, has outsourced printing of cheques to an external vendor called D+H. Whenever a customer orders a new chequebook online and faces some issues while doing so, bank employees politely redirect the customer to the vendor. This is extremely frustrating because the customer doesn’t really care how many vendors the bank has employed, for her the bank is the one responsible for delivering the service.

This also happens when a company requires customers to deal with every department separately. This is extremely frustrating for the customer as she has to spend more time and energy explaining her case to multiple departments and wait uncertainly as each one tries to push responsibility on to the other.

4. You don’t empathise with the customer

It is very easy to state company policy and say sorry we can’t help. It is much more difficult to understand the customer’s situation and create a workaround that solves her problem. Most customer service reps take the short cut and simply dismiss the customer’s request. From airlines to banks we experience this all the time. Companies that go out of their way to accommodate their customers standout.

5. You are not transparent or operate in bad faith

Gyms and insurance companies are particularly notorious for this. The enrollment fee and other charges are complicated. There are so many permutation combinations that it is difficult for the customer to calculate the total cost of the service. Also, the terms and conditions in the contract are vague or technical and difficult to understand.

Customers should not need a math degree to figure out your pricing or a degree in law to figure out your terms and conditions. All your charges, penalties, rules and regulation should be clearly mentioned before the customer hands over her money. The customer needs to know what they are signing up for and what their obligations are. The customer feels cheated if some additional charge comes up on their credit card or if they are denied some discount or insurance claim which was very publicly advertised.

Apart from all of this, some companies make it hard for customers to quit or unsubscribe, hoping that the customer will give up on the idea midway. If it was one click to subscribe and provide your credit card details, it should be one click to quit. Customers are sometimes forced to spend a lot of time and effort to quit, this is unethical and doesn’t go down well with a lot of customers.

6. Your processes and technology suck

Many times executives are stingy when it comes to spending on process or technology improvements since these areas do not directly drive increasing revenue. However, neglecting these areas results in inefficiencies and increased time cost and effort for customers. This could frustrate a customer to the point that she decides to switch to a competing company.

7. You do not have a consistent policy or do not educate employees well

Sometimes companies do not have clearly written policies and this results in customers being left at the discretion of employees. For example, a top airline, Emirates, does not have a clear policy on whether backpacks are included separately in cabin baggage or not. The decision, hence, is left to the discretion of employees handing over boarding passes at the airport counter. This might result in customers being treated differently from one another. This invites conflict with the customer, especially if she has to go through the hustle of re-arranging or discarding luggage at the airport.

8. KPIs not well defined for employees

Sometimes Key Performance Indicators (KPIs) for employees are not clearly defined causing them to pursue their targets irrespective of whether it benefits the customer. A good example would be a sales person providing inaccurate information to the customer just to make that sale.

Below are 3 steps that companies can take to improve on the issues mentioned above.

1. Shifting employee attitudes

Technology issues and bad processes are a common issue among large well established companies. While improving them is important, higher on the priority list is to focus on attitudinal change that needs to occur among employees who represent the human face of the company’s brand. Just having smiling faces at the counter is not enough. Employees need to want to be helpful. This requires hiring the right employees, training them fully, and treating them well. As Richard Branson rightly says, “take care of your employees and they will take care of their customers.”

2. Improve your processes and invest in technology

Executives need to invest in process improvements and technological enhancement since this will not only bring down operating costs but will also make the customer’s life easy by reducing her time and effort.

3. Operate in good faith: Your relationship with your customer does not stop at the point of sale

Customers like companies which operate ethically and keep the promises made to them. This includes companies that are transparent in their pricing, discounts, terms and conditions and which are easy to join and leave. 

Companies often get away with bad customer service in a highly regulated market where there are few players and barriers to entry are high. But as markets open up for global competition, and companies like Amazon, Apple and Google that make customers feel like a king, emerge, the room for poor customer service is shrinking. In highly competitive markets, companies that not only listen to and treat their customers well but also continuously explore better ways of serving customers are more likely to survive.

Disclaimer: The views expressed in this article are those of the author.

Mudassar Shaikh is an engineer at heart, management consultant by profession, entrepreneur by spirit, and student by essence. He is passionate about enabling organizations to develop new technologies and make them accessible to the masses, positively impacting the life of many and pushing the human race forward.

Image: Pexels

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