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Where Customers Drop Off, Step by Step, According to the Research
Customers rarely leave a business all at once; they fall away a few at a time at each step from the first inquiry to the second visit, and because the steps multiply, a small fix early in the path changes the count at the end.
At a glance
- In an audit of 2,241 U.S. companies published in Harvard Business Review, 23% never answered a web inquiry at all, and the average reply among those that did took 42 hours.
- Research finds further drop-off points later in the path, from onboarding, where satisfaction in one company's journey fell almost 40%, to subscriptions, where more than a third of subscribers canceled within three months.
- For an illustrative business, raising the share of inquiries that get an answer from 77% to 95% raises the number of customers who come back for a second visit by about 23%, with every other step unchanged.
The number: 23% of inquiries went unanswered
The clearest measurement of the first drop-off comes from a study in which researchers sent one web inquiry to each of 2,241 U.S. companies and timed the replies; 37% answered within an hour, 16% within a day, 24% took longer than a day and 23% never answered. Those were companies with sales teams, so the exact share will differ for a salon or a plumbing company, but the step itself, a customer reaching out and hearing nothing, exists in every service business and is easy to count.
Later steps have their own evidence, gathered from different industries, and read together they describe the same path most service customers walk.
| Step | What the research found | Source |
|---|---|---|
| Reaching out | 23% of 2,241 companies never answered a web inquiry; replies averaged 42 hours | Harvard Business Review, 2011 |
| Getting started | Average satisfaction fell almost 40% over a pay television company's onboarding journey | Harvard Business Review, 2013 |
| Billing | Before its redesign, a freight company found shipments were billed incorrectly 50% of the time | California Management Review, 2008 |
| Staying | More than a third of subscribers canceled in under three months, and over half within six (5,093 consumers surveyed) | McKinsey, 2018 |
| Life changes | An energy company targeted 40% churn among customers who were moving house | Harvard Business Review, 2013 |
A study of customer journeys in Harvard Business Review found that performance across whole journeys was 30% to 40% more strongly correlated with satisfaction than performance at single touchpoints, which is the practical reason to look at the steps together rather than one department at a time.
Worked calculation: how the steps multiply
Each step passes along only a share of the customers who reached it, so the number who come back is the product of every step's rate, and an improvement anywhere in the chain carries through to the end.
| Step | Today | After answering more inquiries | Source |
|---|---|---|---|
| Inquiries | 100 | 100 | Assumption |
| Share that get an answer | 77% | 95% | Cited benchmark (23% of companies never answered), then Assumption |
| Customers answered | 77 | 95 | Calculated |
| Share who book | 50% | 50% | Assumption |
| Share who show up | 90% | 90% | Assumption |
| Share who come back for a second visit | 60% | 60% | Assumption |
| Second-visit customers per 100 inquiries | 20.8 | 25.7 | Calculated (100 × answer × book × show × return) |
The gain of about 4.9 customers per 100 inquiries comes from one step alone, and because the later steps multiply it, the same reasoning applies to a business that raises its show-up rate or its rebooking rate instead; the step to fix first is the one with the lowest rate that the business can control this month.
How you compare
- Answering: in the audit, 37% of companies replied within an hour; a business that answers every call and message within the hour is ahead of most of the companies studied.
- Staying: for memberships and plans, the subscription research puts the riskiest period in the first three months, so compare your own cancellations in months one to three with the rest of the year.
- Your own baseline: for one ordinary week, count inquiries, answers, bookings, arrivals and rebookings, and divide each by the step before it.
The first step is to take that one week of counts, find the step with the lowest rate and fix it before touching any other.
Sources
- Oldroyd, J. B., McElheran, K. and Elkington, D. The Short Life of Online Sales Leads. Harvard Business Review, March 2011. Audit of 2,241 U.S. companies.
- Rawson, A., Duncan, E. and Jones, C. The Truth About Customer Experience. Harvard Business Review, September 2013.
- Bitner, M. J., Ostrom, A. L. and Morgan, F. N. Service Blueprinting: A Practical Technique for Service Innovation. California Management Review 50(3), 2008.
- Chen, T., Fenyo, K., Yang, S. and Zhang, J. Thinking Inside the Subscription Box: New Research on E-commerce Consumers. McKinsey & Company, 2018. 5,093 U.S. consumers.
Related reading: Service Design for Small Businesses: How Customers Actually Experience You · What Is a Customer Journey Map, and What Is a Service Blueprint? · Mapping the Patient Journey at a Dental or Medical Practice · The Cost of Inaction (free live session)
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