Customer WinBack summary

Introduction

Customer Winback by Jill Griffin and Michael W. Lowenstein Customer Winback shows how businesses can recover lost customers and turn defections into growth. Do you ever focus all your marketing budget on acquiring new clients while ignoring lost ones? In fact, companies lose billions of dollars each year by letting valuable customers slip away.

Yet the chance of winning back a lost customer is much higher than selling to a stranger. This book reveals why customers walk away and how to systematically win them back. By following these strategies, businesses can recover lost revenue and strengthen customer loyalty.

The Hidden Cost of Losing Customers

The Hidden Cost of Losing Customers. Do not ignore customer defection or be apathetic about winning them back. Many business owners believe the market has plenty of potential customers. It is not worth spending time and money winning back lost customers.

After all, they reason, what is the loss of one customer? It is small compared to the many we have retained. The problem with this thinking is that retention rates can be misleading. Specifically, this is the number of customers you keep over a certain period.

To illustrate this, imagine a college that retains 80% of students. This is for each class from one year to the next. This seems healthy, does it not? But if the college starts with a freshman class of 1,000 students, then the sophomore class will fall to 800.

The junior class will fall to 640, and the senior class will only have 512 students. In addition, firms are largely unaware of substantial losses. These are associated with customer defection. They also miss the substantial benefits of winning customers back.

The loss of a single long-term customer means companies must expend resources. This includes marketing materials, sales personnel, and costs, etc. They must acquire a new customer to make up for the lost revenue. Moreover, losing a customer offers firms a valuable experience.

There is a reason customers leave in the first place, uncovering that reason can help to win customers back. It can also retain existing customers and even acquire new ones. Unfortunately, however, many companies see lost customers as dead opportunities. Often, businesses have developed a caricature of the lost customer.

They see her as merely a disgruntled individual with a chip on her shoulder, someone who would under no circumstances return to their company. It is no wonder that they do not even try to woo them back. But this is not exactly true. In fact, studies found that the average firm has a high success rate of 60-70% when selling again to active customers.

They have only a 20-40% chance of successfully selling to lost customers. Now, compare this to new prospects. There, the odds of striking a deal are only 5-20%.