How to Lose Customers

Recently my car insurance was coming up for renewal. The business media was hinting that the company I was with were heading for a big loss.

So I was expecting a hike in the new quote. On he day the quote dropped through my letterbox, the CEO of said company in an interview stated, " most people would see a modest increase " , a couple of percentage points. I opened the letter, lo and behold a whopping 47% increase.

Some bright spark must have thought their customers would be gullible enough to pay for their loss. No sir not this one. Oh no I thought " here we go ringing around to get a new quote". I happened to mention this to a friend of mine and he recommended this one brokerage.

The next day I phoned up, spoke to a very nice lady and got a new quote. Even paying less than I was last year. Now here is the kicker. My new agency is underwritten by a company I left three years ago, because they tried to play the same trick, due to a massive loss they suffered.

To paraphrase a Jim Rohn quote " it takes about $10.000 to gain one new customer". These two companies are constantly advertising on TV,radio,print and the web. I wonder how many millions they spend trying to gain new customers. Thing is I was happy with the company I was with three years ago, I was even much happier with the one I just left and referred at least five people their way.

Another business saying " it takes six seconds to lose one customer and six months to gain a new one ".

Maybe someone out there can tell me which business school is teaching these folks to . .. . spend millions on advertising to gain new customers. When you get them,treat them well and remember when you suffer big losses increase your prices by 47% and all will be well and dandy.

We all make mistakes, but to expect your customers to pay for your management's error in judgement, just doesn't cut it. Those two companies could have saved themselves a fortune if they had just treated their customers with a little bit of respect and remembered the six second/six month rule.

If you are in business and have gone to the same school as these guys,don't expect your customers to stay loyal while you try to get them to pay for your mistakes.

Colin Myles
Author & Listener

Author ; How to Avoid Business Failure
Author ; 67 Uplifting Quotes

" Honesty is the soul of business "  Dutch Proverb

Author ; 5 Keys to Doing Business with The Right People