5 reasons why customers defect

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Greg Warner is CEO and Founder of MarketSmart, a revolutionary marketing software and services firm that helps nonprofits raise more for less. In 2012 Greg coined the phrase “Engagement Fundraising” to encapsulate his breakthrough fundraising formula for achieving extraordinary results. Using their own innovative strategies and technologies, MarketSmart helps fundraisers around the world zero in on the donors most ready to support their organizations and institutions with major and legacy gifts.

We’ve talked about the 80/20 rule and why you should focus on the 20% of your clients who (most-likely) generate 80% of your profits. And we all want hot new leads.  But what about the clients who no longer buy from you?  If you can find out why people are leaving, you can fix the problem.  We figured the “defectors” are worth a blog post or two and some effort from your marketing and sales team as well.  So here goes….

Here are the 5 main reasons people leave.

1- Intentionally pushed away. Yes.  It’s ok to push away an unprofitable client.  They aren’t worth pursuing unless you can get them to be profitable.  This ties nicely to our 80/20 discussion.  And we recommend you “clean out your closets” every now and again.

2- Unintentionally pushed away. Yikes!  If we lose profitable clients accidentally, we’re really screwing up!  Look at your service issues.  How are problems being resolved?  Promptly?  Courteously?  Are you sending out client satisfaction surveys to rectify problems that could lead to unintended consequences?

3- Pulled away. Ouch! That means your competitor gave them more attention, a better deal, or better service.  Clients are like teeth… if you totally ignore them, they’ll fall out.

4- Bought away. This ties in with marketing and sales because it means that your competition made a strategic move to give your client a compelling financial reason to switch providers.  If you aren’t doing marketing with compelling offers, you’re a sitting duck waiting for your competition to beat you to the punch.

5- Moved away. If your client simply no longer needs what you sell or has moved out of your geographic trading area, there’s really nothing you can do.  It happens.  Although we recommend you try to get a testimonial or referral before they leave.

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