Bad customers cause major headaches and can cost your company money. Here’s how to discover who the bad customers are for your organization.
After the sixth phone call my friend Todd reached a conclusion. “There was NOTHING I could do that was going to make the customer happy,” said Todd, a national sales director of a major US manufacturer. “He had no intention of being satisfied.”
Todd dropped the client.
Now you may have heard the old saying that the customer is always right. That however doesn’t mean there aren’t bad customers. They are the customers that drain resources and opportunities, robbing you of time to focus on your top customers. They’re the ones with excessive demands and complaints and your employees hate them. Finally, they’re most often the source of negative word-of-mouth about your company.
How do you identify a bad customer? Here are some tips:
- The customer has high service costs and contacts you above average
- The customer exhibits a consistent behavior of switching vendors within your sector and others
- You acquired the customer through a high promotional inducement, which creates an expectation of price discounts or incentives, neither of which is good for margins or long-term loyalty
- Your staff consistently complains about the customer
- They threaten to drop you or sue you any time they are unhappy
- The customer is outside of your ideal target market
Remember, the quality of your relationship with the customer determines your profitability with the account.
In upcoming writings we’ll talk about how to deal with the bad customer (firing them works but is a last resort option). Right now though I’d like to know how you identify a bad customer. Leave me your indicators by commenting on this posting.
Tags: Bad Customers, Customer Service
