Competition stealing your customers? Learn why and how to prevent it.
The problem of the competition stealing your customers has existed for as long as businesses have, but in the current global climate with many businesses failing and tight competition, businesses are particularly concerned with keeping their clients. In fact, one of the first things you need to do if you are working on a business turnaround is to find ways to keep your current customers so that things don’t get any worse for you. First of all, you need to know why customers will potentially leave you and how it is that competitors get the opportunity to steal them.
Do you know what the number one reason is that will cause customers to leave you? Many companies mistakenly believe that it always comes down to price, but in recent research conducted by the Peppers and Rogers Group, the reason that customers left above all others came down to the emotional experience they had with the salesperson. 70% of customers left a company due to poor service, 60% due to perceived indifference from the salesperson, while those who perceived their salesperson to be exceptional were 10 to 15 times more likely to stay with the company.
Only 14% of customers who leave are dissatisfied with your product or service. This includes factors such as the price. These statistics really show that putting the time into establishing a great relationship with your customers will be a key factor in retaining them.
Now that we know that customers usually leave due to a poor emotional experience, how is it that competitors manage to get their hooks in and steal your customers? Simply put, if you are both solving the same problem for customers then they are probably doing it better. Remember that emotional experience had by the customer? Your competitors are smart and they know that you are probably (like a large number of companies) neglecting the experience of your current customers. We often put a lot of energy into romancing new customers but it is important that you put the same amount of energy into maintaining the relationship. Make compelling offers to your current customers and always ensure that they have a top service experience. If you cannot keep delivering a great emotional experience, then your customers will be ripe for the competition to steal them away.
If you want to put strategies in place to prevent competitors from stealing your customers, here are five ideas for you to try;
1) Be the best option. This means keeping an ear to the ground and understanding what your competitors have on offer too. Join local business groups, attend dinners and keep an eye on competitor’s offers and promotions. Remember that being successful in business means solving a problem that your customers have and doing it better than anyone else.
2) Try using contracts. You could offer a special discount for customers who agree to use you as their supplier for a set period of time. Contracts like this prevent competitors from being able to get a look in and are also valuable if you are possibly looking to attract buyers for your company.
3) Don’t publicize your entire client list. While it is great to have client testimonials on your website or LinkedIn profile, if you include every single client, you are providing your competitors with a potential client call list. Have a few key client testimonials up but otherwise keep the rest of your list on the down-low.
4) Develop key relationships. Your most valuable clients will be the ones that value sticking with you due to the relationship you have built rather than being purely based on price. Make sure you nurture those relationships, offer special promotional deals to reward loyalty and make sure that your business is continuing to solve problems for those clients. It is much more difficult for your client to go to the competition when they have a strong relationship with you.
5) Deliver what your customer values. Many salespeople make the mistake of piling on extras that clients may not want or need. This means that not only is it costing extra money, it may cost you the customer too if they do not perceive value. Find out exactly what it is that your customers will value by asking questions and making concessions where you can. If your customers do not want any extras, then trying to use a value versus price argument to win their business is most likely useless – move on to something they do value, perhaps it is the relationship with you!
If the competition stealing your clients is an issue in your business, take the time to evaluate and work out why your competitors are getting their hands on your customers. If your client base is largely price-driven, perhaps it is time to go and find new clients who appreciate factors other than price and value what you have on offer for other reasons. At the end of the day, if you are looking for a business turnaround, your clients need to be profitable to you too so competing on price is often not viable. Provide the stand-out emotional experience and you should notice the difference in your business.