Surprising Statistics Showing Why Your Customers Stop Buying

And How Follow Up Can Save Them!

Depending on the type of business or service you may not even know if or when you lose a customer. Studies show less than 4% of your customers will tell you if they are unhappy so depending on your follow up process you may never know if you have a customer on the fence.

Here are the statistics on why businesses lose customers:

1% Die

3% Move away

5% Form other relationships

9% Leave for competitive reasons

14% Due to product dissatisfaction

68% Stop buying your product or service because of an attitude or feeling of indifference towards them by one or more persons representing the company.

 

How can follow up save the 68% of the customers leaving? It’s about preventing the attitude or feeling of indifference. The following are 4 sales follow up steps to insure you don’t lose customers and avoid the 68% trap:

  1. A simple “thank you for your business” when the sale is complete.
  2. Send thank you cards to welcome new customers or sales.
  3. Create an email thanking your customer again for their business and let them know where they can go for additional service and support if needed.
  4. Determine the customer’s next need and remind them of your company or service by email, phone, or direct mail.

 

The major point of these steps is to insure your customers feel appreciated. Customers who feel appreciated will typically not fall into the 68%. And if by chance your customer had a less than satisfactory experience in their last transaction these steps will help turn the tide back in your favor.

To learn more about creating a follow up system make sure you to read Creating a Follow Up Strategy where I discuss follow up strategies for existing customers.

Shocking Sales Statistics as It Relates to Follow Up

Truly shocking sales statistics as it relates to your  follow up process:

48% of sales people never follow up with a prospect
25% of sales people make a second contact and stop
12% of sales people make more than three contacts

2% of sales are made on the first contact
3% of sales are made on the second contact
5% of sales are made on the third contact
10% of sales are made on the fourth contact
80% of sales are made on the fifth to twelfth contact

Creating and using a follow up system is a guaranteed way to grow your business.  In fact with less than 52% of all sales people following up with their prospects you will not only grow your business but you will stand out amongst your peers.  And remember 80% of sales are made in the fifth to twelfth contact if you are in a market with heavy competition you literally eliminate your competitors by simply following up.

To learn more about creating a follow up system make sure you to read Creating a Follow Up Strategy where I discuss follow up strategies for existing customers.

Creating Stronger Relationships with Follow Up

Follow up is crucial in creating relationships with your clients and prospects.  The number one reason business owners and sales people give me when I ask them why they don’t follow up is “I don’t have time”.  When I hear this I think to myself you can’t afford not to have time!  I also think the excuse of “I don’t have time” is really the business owner or sales professional self sabotaging their own success.  I have discussed many systems and follow up tools to help you automate the follow up process which makes the excuse of not having time seem crazy.

Think about this…  If you are a business owner or sales professional how many new clients did you receive last year?  Is it 10, 50, or 100 new clients? Now approximate the total sales or commissions you received from each client and divide this by the total number of new clients from last year.  What is the number or average value of each client?  Is it $200, $2,000, $20,000, or $200,000 in sales or commissions?

It does not matter what the number is.  What is important is that you understand what the value of one client or prospect is to you.  For example let’s say the value of one client is $2,000.  The next time you think to yourself I don’t have the time to follow up realize this thought can be a potential loss of $2,000!  If you retain your average client for 5 years this would be $10,000!

The number one reason you will lose a customer is not from price or a competitor knocking on their door every week.  The number one reason is the feeling of indifference.  Clients start looking elsewhere when they feel unappreciated.  This can easily be solved by having a simple follow up system in place.  Imagine if you implemented a system that could not only insure your clients felt appreciated but would also increase the lifetime value of each customer.  Increasing the life of your customers by just one year or more could make a huge difference in your business.

I encourage you to leave a comment and let me know what your follow up system is.  Are you following up with email, newsletters, post cards, greeting cards, phone calls?  What are you doing to keep strong relationships with your customers and clients?  If you need help creating a follow up system or just would like me to evaluate your follow up system please contact me.

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Creating Great Follow Up With Your Clients in 7 Simple Steps

Today I was listening to a great podcast by Dr. Ivan Misner the founder of BNI on Networking Now about following up with your clients and creating touch points. Dr. Misner offered 6 steps in creating touch points with your prospects and customers. After listening to the pod cast I ended up with seven steps!

Step One – Spread out your contacts! Many people do great follow up in the first few months of making the sale and then the follow up seems to drop off. Maintaining consistent follow up or touch points through phone conversations, live appointments, email, newsletters, and greeting cards should be the goal.

Step Two – Train your clients to expect to hear from you. Be consistent! If it makes since for your business or product to meet with them once per quarter than make sure you always meet with them once per quarter. Your clients will begin to plan on hearing from you and will make time to see you.

Step Three – Make each contact lead to the next contact. Let your customer know when they will hear from you again. If you are meeting every quarter, ideally you would schedule the next quarterly meeting before leaving. If you need to follow up with additional information make sure to let them know when they can expect from you.

Step Four – Assume responsibility to make contact. As the sales person or business owner it is your responsibility to maintain the relationship. Remember customers who don’t feel appreciated or feel they are not being taken care of will naturally start looking for someone else. Keeping consistent contact and taking responsibility for the relationship will help your to maintain your customers for life!

Step Five – Invite customers to networking events. If you have found a great networking event make sure to invite a few of your customers for the next one. Invite them to your BNI group or a local chamber of commerce. If you are in Rotary or Kiwanis invite them to your next meeting. Seeing your customers every week or every month at a service organization or networking event will help you create a stronger relationship. Not to mention if you have found new clients at these groups your customers may as well.

Step Six – Create a plan and stick to it. If you are consistently following up with your customers your customers will naturally start contacting you. The key is to not break your consistency. When your clients contact your don’t restart the clock or change your pattern. Stay on your same touch point schedule and this will just encourage more interaction.

Step Seven – Once you have your plan implement a system to make this easy. For each element of your follow up or touch points do whatever you can to put this into a system. Systems mean automatic! Automatically your news letter will go out every month. Automatically your outlook calendar or salesforce.com reminder will pop up. By having a system you guarantee consistency in your actions.

It’s important to remember following up with prospects is a must but having consistent follow up or touch points with your customers is equally as important. The goal for this follow up or touch point system is not to sell. The goal is to create conversations. The conversation might be:

  • How can I help you?
  • Are you satisfied with our product or service?
  • I was thinking about your business today and thought of a few additional ideas for you.
  • How can I make this service work better for you?

Through conversations you will create stronger relationships. Through these relationships you will receive more businesses and the best part is you will receive referrals!

Are you using a system now? Please leave a comment and tell us what are you using in your business for follow up and touch points!

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Of Course I have a Referral and Follow Up System!

A referral and follow up system…  You may be asking yourself what do I need that for?  I was reminded about a pretty well know fact after reading yesterdays post on Duct Tape Marketing by John Jantsch titled My Most Excellently Flawed Referral Survey.  The survey questions had to do with the percentage of your business coming from referrals or word of mouth.  Here is what John found:

69.3% felt over 50% of their business came by way of referral and yet, 79% further admitted they had no well-defined system to promote referral generation.  The conclusion is we know how important referrals are yet we don’t take the time to create a system to attract them!

John also asked if you are not getting a consistent flow of referrals why not?  20% of the participants of the survey just skipped this question!  Maybe after realizing so much business comes from referrals and acknowledging they have no system that thinking about why was just too much must for those in the survey to handle?

For years I have heard and seen similar numbers like this.  Business owners and top sales professionals say things like the live for referrals yet if I ask the simple question of what do you do when you receive a referral I more often than not get a blank stare.

Receiving more referrals is pretty simple and there are many ways to do this.

  • Simply asking your customers for referrals or people they know who can also use your product or service is a great place to start.
  • Making sure you acknowledge and reward the referral senders will naturally grow the amount of referrals you receive.  People will enjoy helping you and when you acknowledge and appreciate them and will in turn help you more.
  • Staying top of mind with your customers, prospects, and referral sources will generate more business and referrals for you.  You can do this by calling, emailing, sending greeting cards, and newsletters.  Staying top of mind is customers and prospects is about creating a relationship.

The best referral and follow up system I have seen and used for years is SendOutCards.  When used correctly you can create an explosion of referrals with very little effort.  The reason for this is SendOutCards is a great system and once set up can go on autopilot.  You can learn more about SendOutCards and how it might work for you by visiting this site.  Fill out the contact information and I will call and talk to you about it personally.

Whether you use index cards, Excel, Outlook, SendOutCards, Act!, Goldmine, Saleceforce.com, or any of the many other CRM tools on the market the important thing is you use one.  Commit to a system, spend the time to get it set up to work for your business, and then use it no matter what!  The benefits of using your referral and follow up system will outweigh any time or pain you might feel getting it started!

So tell me, what system do you have?  What are you doing to increase your referrals and follow up with your clients and prospects?

Create a Strong WHY to Achieve Your Goals

I last talked about how creating a strong WHY is an important step in your follow up and sales success.  The why is a fantastic motivator to push you to make one more call, mail one more thank you card, or follow up with one more prospect.

Last week the importance of a powerful why kept coming up as I had many discussions regarding this concept with colleagues, clients, and prospects.  Over and over again this was part of my conversation in my meetings, from private conversations, conference calls, and even when I was conducting a training for a group of entrepreneurs.  Today I decided to share a small part of my why which is what really keeps me going at a pace that seems to baffle some of my closest friends.

My main WHY, goal, purpose of my life, reason why I do what I do be stated in one sentence, one I Am statement, one vision:

I am positively effecting the lives of millions of people through humanitarian projects I personally create, fund, or participate in.

This is the main reason why I do what I do, the reason I make a few extra calls when I want to stop working for the day, the reason why I keep going, pushing, and working towards all the other goals I have.  My why makes all the day to day things seem small, it makes any negatives neutral, it makes disappointments last moments instead of days, weeks, or months.  It is what keeps me on my path.

As I am writing I am thinking about how my why is already becoming a reality.  It has been happening for years and it seems every year I am getting closer and closer to achieving my why.  From building homes in Mexico, supporting micro banking and water projects through Rotary and Kiva, or working on my newest cause the Global Hug Tour, MY WHY is happening!  This year alone being a part of the Global Hug Tour team will allow me to touch the lives of over 100,000 people in a positive way.  The local projects funded by the Global Hug Tour can easily impact 10, 20, or 50 thousand additional lives.

I hope you understand why I decided to share this with you today.  My hope is by sharing my why you will think about yours and by really identifying yours you will have all the success you desire!

Please take a moment and tell us about your why or how this post has inspired you to take action in creating a powerful why by leaving a comment.

To learn more about the Global Hug Tour please take a look at the website and if you are on Facebook please support the tour by becoming a fan!

Zappos Pays Employees to Quit!

There was a great article in the current Inc. Magazine titled The Ultimate Business Tune-Up For Times Like These.

The article listed 23 things you can do right now to energize your employees, wow your customers, and get your business back on track.  One of the ideas from a previous Inc. Start-Up Blog post was from a great company Zappos titled Pay employees to Quit!

During the first month of training, Zappos offers new employees $2,000 to quit, plus their time worked!  This may sound crazy but to Zappos it’s a matter of costs…  The cost of training an employee who is not happy or does not fit the company culture is far more than $2,000!  Zappos wants people who are passionate about customer service and who love their company culture.

I know for me I am always attracted to companies who seem to have a passion for what they are doing.  If I receive a follow up call from a new contact or someone who wants me to purchase their product I listen for the passion.  How many times have you purchased from someone just because you felt inspired to support them?  Have you ever been price shopping for a product and found a sales person or company who was so passionate that you decided to stop looking and just purchase?  Do you see how valuable passion could be for you?

So if passion is so important to a company like Zappos it might be something you should consider as well.  Whether you are an employee or the owner of a business or an entrepreneur passion is one of your best assets.   Why not take a look at how you are doing in regards to passion.  You might just find an opportunity to light the fire of passion within you!

Follow Up Strategies: Two Days Before Christmas

This morning I had a completely different post in mind.  I was going to write about sending books to your top clients and referral sources for the New Year.  In thinking about follow up this morning I decided to write about a simple and highly effective follow up strategy for the two days before Christmas.

Take a look at your top 25 clients and referral sources for the year, print out a report or simply write them down.  Once you have them pick up the phone and call each one.  Call them and wish them a Merry Christmas.  If you are not sure if they celebrate Christmas wish them a Happy Holliday weekend.  Thank these clients and referral sources for the business and referrals from the past year.  Ask them what they are doing for the holiday.  In general you want to touch them right before the holiday.  Don’t ask for new business or referrals, just thank them and wish them a great holiday.

You may not be able to reach everyone as I am sure some have already taken the week off, so just leave a message or a voicemail.  It may seem simple because it is!  These simple touches build your relationships with your clients and referral sources.  By doing this simple task you are showing your clients and referral sources that you care about them and appreciate them.

It’s a bit difficult for me to call you and wish you a Merry Christmas and a happy holiday weekend!  Please know that I appreciate you for taking the time to visit my blog and I truly appreciate the many emails and comments I receive from my posts.  I wish for you a wonderful holiday filled with great moments which create lasting memories.

Do You Still Need to Send Your Holiday Cards?

You still have time to get this important follow up strategy completed!  However at this point you are a bit limited on how you can get this done.  One way is to make a mad rush to the store and buy boxes of holiday cards only to spend today and most of the weekend writing them out.  I must say the thought of you actually doing thing is making me tired!  I know as I have done this so many times in the past!  I am sure if you have not yet sent your holiday cards you know you need to and have just been procrastinating to the very last minute!

Don’t worry!  You have another option available to you which will allow you to send all of your holiday cards within a few hours.  Whether you need to send 100 or 2,000 holiday cards you still have time to get it done!  It all starts with having access to a powerful system called SendOutCards!

SendOutCards is a very simple online tool which allows you to upload all of your addresses, choose a holiday card from over 1,000 choices, type out a nice holiday message, and with a few clicks send to your entire database!  Your cards are then printed, stuffed in envelopes with a real stamp, and placed in the mail the next day! The best part is you can actually send the same holiday card to 500 customers and prospects and then go back and write additional messages to your top 25 customers and prospects to make them more personal.  This means no customer or prospect is forgotten!  SendOutCards also allows you to add gifts to your cards!  So if you should be sending a little something extra to those top clients you are covered!  To learn more about this tool visit SendOutCards and click on the top banner to send a free card and get the tour.

There is just no other service on the market that can do this with such ease!  I have used this service for the past few years for holiday cards as well as all the different business greeting card occasions with great success.  This is not just a holiday card tool!

If you happen to be one of those thinking “it’s too late to send holiday cards at this point” or “does sending holiday cards really make a difference in my business?”, I would encourage you to consider recent research by Hallmark:  Hallmark found that businesses say they use greeting cards as a “kind of investment in their business…  They’re investing in customer relationship with the hopes that it will pay back”.  The company has conducted research that found at least half of customers who received holiday cards from businesses say they are more likely to continue doing business with that company versus another one.  You can read more on this by reading the article in the Washington Post.

So the question to ask yourself is not whether you should send holiday cards or not…  The question is whether you want your current customers to continue doing business with you!

Holiday Follow Up: Greeting Cards, Postcards, and E-cards

Today you have many choices when it comes to holiday cards.  The choice of holiday greeting cards is enormous, and we cannot forget holiday letters, postcards, and e-cards.  As business owners and sales professionals what are the best practices?  In my opinion, holiday greeting cards should be your only choice!

Holiday cards: You have many options here!  Sure you can go to your local Hallmark store or grocery store to pick up your greeting cards.  In fast the top two greeting card companies Hallmark and American Greetings which print most of the greeting cards on the market would love for you to do just that!  It’s fairly simple, find a greeting card selection which will reflect your business in a good light, lock yourself in your office for the day and get to work!

Holiday letters: I have already received a few holiday letters from friends and businesses.  These are nice and typically very personal when coming from friends and family.  I would not recommend these for a business greeting.  Sending a gift with a letter is a pretty common practice but in my opinion if you are spending the time and money to send a gift why not include a greeting card as well?  Skip the basic form letter and add a personal note to a greeting card instead.

Holiday Postcards: Thinking this is a great cost saving alternative to mailing holiday cards is a big mistake. When I think of postcards the first thought that comes to mind is junk mail.  It does not matter how much time you put into your postcard design or the amazing copy you have come up with, in the end it’s just a postcard and it will leave a neutral or negative impression.

E-cards: The crazy popularity of e-cards has come and gone.  Some may say this is a great alternative to sending holiday greeting cards in the mail.  I would encourage you to consider the conversation I had with Jeff Hans real estate agent on Team-Q at Re/Max Realty.  Jeff mentioned a conversation he had with another business owner just last week.  The business owner asked if he had received his e-card.  Jeff had to think about it for a minute and then acknowledged he had received it.  The business owner asked what Jeff thought and his response was the following: “I receive over 200 emails per day so receiving your e-card was just another email”.  Jeff suggested that next year he mail holiday greeting cards instead of sending e-cards!

My last thought for your holiday cards choices.  I mentioned the top two greeting card companies Hallmark and American Greetings so I thought I should mention the greeting card company I have used for my holiday cards, birthday cards, thank you cards, and just everyday cards for the last two years.  The company is called SendOutCards and it just so happens SendOutCards is the number three greeting card company.

I think the most important thing to remember is to get your holiday cards out.  It is by far the easiest follow up touch you can do this week and with each follow up touch you do you increase the awareness your customers and prospects have with you.  This increased awareness will result in increased business and referrals!