Eight Reasons for Customer Defection

Customers come and go for all sorts of reasons. It is unrealistic to expect customers to rely indefinitely upon one vendor or service company; we must accept that a portion of them will leave for a number of reasons. Market analysis of customer behavior has demonstrated eight specific factors that influence decision makers’ actions; six of these are controllable by you and your employees, and will be discussed further in the next post. For now, we will briefly explore each of the eight possible reasons customers switch from one business to another.

Price

This one seems fairly obvious, but for a variety reasons can be difficult to understand why a customer would choose someone over your product or service; especially, when, all things considered, you are both offering comparable items or services. Certainly, discounts, and such, will have an impact on customer behavior. Other factors play a role in pricing, too, for example, the economic level of the community, employment patterns, and mobility of customers. The last influence leads to our next reason for defection.

Inconvenience

Location of your business is critical in attracting and retaining customers. This holds true for you and your employees as well. If your client base is located at a great distance your travel time and expenses will adversely affect your ability to meet the customer’s needs. Equally, the distance customers must travel to acquire your products or services can negatively impact their decision to use your company.

Product Failures

Not too surprisingly, this is a major reason for customers to stop coming to your company completely. Quality control is critical in the opinion of most consumers. Your selection or use of products will have a direct impact on customer satisfaction.

Employee Responses to Service Failures

How your employees (and you for that matter) handle mistakes, shortcomings, or poor quality of a job performed will directly influence how your customers consider doing business with you in the future.

Ethical Problems

Fairness in your dealing with customers will always payoff in terms of customer satisfaction. Any sleight perceived by your customers can be cause for defection. In some cases, you or your employee may not even be aware of such negative perceptions because your business environment may not consider the implications of some of your company’s actions.

Involuntary Effects

Sometimes bad things happen for no good reason. Life is like that on occasion. Good luck and continue on as best you can.

Competition

Free enterprise has proven to be one of the greatest inventions of the modern world; however, it can cause us to stay up at night. If you have been in business for more than an hour, you know how your competition can influence negatively your customer base.

Service Failures

Delays in deliveries, misunderstandings, and a whole range of other mistakes fall into this category. Any one or another of these can jeopardize customer retention. In our next post, we'll explore various means by which you can overcome at least six of these reasons for defection, so hang in there! I am sure you already have experienced some the issues discussed above and probably have many suggestions of your own on how to overcome these problems. Please feel free to let us know in the comments how you would cope with these problems or any others that you have encountered.