Why ex-customers may be your best prospects

Most companies constantly seek new market segments as potential customers for their products or services. Rarely do they consider one that can be surprisingly cost-effective: those who stopped doing business with you.

Focusing on the customers who used to do business with you offers a great opportunity to grow your business and can improve your relationship with current customers.

Most people instinctively avoid rejection, so when a business customer stops calling or ordering, they let it go without any attempt to recover the business or even understand why they left. Look, customers may leave for any number of reasons. If they became angry or dissatisfied with you, they’re not likely to return. People do hold grudges.

But I’m pretty sure you’ve lost many of your customers for one of two reasons. Some may have been tempted to try a competitor and then decided to stick with them. As for the others? Maybe you just didn’t work hard enough to keep them.

Targeting former customers is well worth the effort. They thought well of you enough to do business with you once. They already know who you are. They know what you can do. That means you don’t have to invest a lot of time and money explaining both.

Why don’t more companies target ex-customers? I suspect they fall into an emotional trap when customers leave. They react as though the customer were a wayward spouse, becoming hurt or bitter. Know what? In most cases, their departure really wasn’t about you. It was about them and their perceived needs. Do you think twice about trying a new restaurant or tossing a bone to a prospective supplier? Do you intend those actions as an insult to your regular eatery or vendor?

Start treating former customers like a jilted romantic interest, and they won’t come back. If they do give you another try, showing a single trace of resentment or jealousy will trigger an irreparable split. Customer service isn’t a romantic relationship. It’s a business deal.

The first step in reestablishing any kind of relationship involves one party reaching out to the other. When it’s a past customer, it’s up to you to suck it up and take that first step. Sometimes, that first step is all you need to convince them to return.

Maybe it’s an email or a quick phone call. You haven’t heard from them in a while, and you wanted to check on them. How are they doing? Is there anything you can help with? A few will see it as an annoying intrusion, but most will be touched that you checked up on them.

Another way to bring former customers back is a special offer. And I mean a very special offer, not ten bucks off their purchase of an 8 Series coupe. As you decide what to offer, keep in mind that marketing to people who know you takes a minute fraction of what you’ll need to spend to romance complete strangers. You can afford to be generous. (And generosity is a trait people admire.)

Say you run an HVAC repair company. Why not drop a note to customers who haven’t been active for two or three years? “It’s been a while since we’ve had the opportunity to help you with your home comfort needs. We appreciate your past trust and hope you’ll turn to us for your future plans. As a way of thanking you for doing business with us in the past, we’d like to make a special offer. We’ll perform a free ‘clean and check’ on your furnace. That’s normally a $129 service call, but because we value your business, we won’t charge you for the service.”

You might protest that you’re giving up $129, but you’re going to make a lot more than that in future business. Plus, your technician might spot needed repairs or discover opportunities for additional components. Since you reestablished the relationship in a friendly, non-threatening way, they’ll be more likely to call when more work is needed, or to refer you to their neighbors.

I suggested this approach can also improve your relationships with current customers. How? Just ask your former customers why they left in the first place. You can develop a simple survey, or even call them. Pay attention to patterns in their answers. If half the people you talk to mention that your customer service was rude or your sales reps just didn’t seem to care, you know what you have to do to prevent other departures.