Keep clients coming back · Every business
Why Customers Don't Come Back (and How to Find Out Which Ones Left)
Most customers who stop returning leave over something that happened during the service, and a lapsed-customer list with one short question attached will tell you which ones left and why.
Most customers who stop coming back leave because of something that went wrong in the service itself, such as a mistake, a careless or rushed moment with a staff member, a price that felt unfair or a schedule that stopped fitting their week; in a study of customers who had switched providers across 45 kinds of service businesses, published in the Journal of Marketing, core service failures were mentioned by 44% of respondents and failed encounters with staff by 34%. The quickest way to find out which of your customers have left, and why, is to pull a list of everyone whose last visit is well past their usual gap and ask each of them one plain question.
| Reason customers gave for switching | Share mentioning it |
|---|---|
| Core service failure (mistakes, billing errors, a job done wrong) | 44% |
| Service encounter failure (staff who seemed uncaring, impolite or uninformed) | 34% |
| Pricing (high, raised or unfair prices) | 30% |
| Inconvenience (location, hours, waiting for an appointment) | More than 20% |
| Poor response to a problem (no apology, reluctant or no fix) | About 17% |
| Attracted by a competitor | About 10% |
Find the customers who left in 30 minutes
- Export your customer list from the booking, scheduling or invoicing software, with each customer's last visit date, number of visits and total spend.
- Write down the usual gap for each service. A haircut might come back every six weeks, a dental cleaning every six months and a furnace tune-up every twelve.
- Flag the lapsed customers. Mark anyone with at least two past visits whose last visit is more than one and a half times their usual gap ago.
- Sort by total spend so the first messages go to the customers who mattered most to the business.
- Send one question, using the template below, by text or email from the business, not from a personal phone.
- Sort every answer into the categories in Exhibit 1 on a simple tally sheet, and fix the most common reason before anything else.
- Offer a time to everyone who replies, including the ones who complained, since a problem handled well is a reason to come back.
| Message | What to send |
|---|---|
| The question | "Hi [first name], this is [business]. It's been a while since your last [service], and we'd like to know how we did. Was there anything about your last visit we could have done better? A one-line reply helps us a lot." |
| If they name a problem | "Thank you for telling us. You're right that [the problem] shouldn't have happened. We've [what changed], and we'd like to make it up to you with [a specific offer]. Would [day] at [time] work?" |
| If they've simply been busy | "Glad to hear it. We have openings on [day] and [day] this week if you'd like to get back on the schedule." |
The owner's first instinct after a quiet month is usually We need more new customers, and the lapsed list shows how much of that gap is made up of customers who already liked the business enough to come back at least once.
Why it works
Keeping a customer is usually far cheaper than finding one, and the payoff compounds over time; research by Bain & Company, summarized in Harvard Business Review, found that increasing customer retention rates by 5% increases profits by 25% to 95%. A lapsed-customer list is the cheapest place to start, because these customers already know where you are, what you charge and who does the work, and a reason that comes back in their own words points directly to the step that needs fixing.
Sources
- Keaveney, S. M. Customer Switching Behavior in Service Industries: An Exploratory Study. Journal of Marketing 59(2), 1995. Critical incident study of more than 500 service customers; 838 critical behaviors coded across 45 service types.
- Gallo, A. The Value of Keeping the Right Customers. Harvard Business Review, 2014.
Related reading: What Doing Nothing Really Costs a Small Service Business · What Is a Business System? A Plain Explanation With Examples · What to Do When Something Goes Wrong: How Small Businesses Win Customers Back · Small Touches That Make Customers Come Back: A Checklist by Business Type
Email hello@osnovaops.com about bringing customers back
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