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By Sanath Dasanayaka

Loss of customers;
Reduces profits.
Creates low morale among employees.
Higher employee hiring and training expenses.

By keeping existing customers, a firm minimize any negative word-of-mouth.

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Knowledge on customers is the key to successfully winning back lost customers.

Computer information technology allows the access to and analysis of detailed
customer data.

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1. Strategies for saving a defector: there are both immediate and longer-term steps
you need to take to have a lost customer back.

Quick Strategy: If a valued customer has told you in person that they are no
longer going to be buying from you. This is time to;

Listen carefully and acknowledge their complaint. Be contrite!
Dont pass the buck and say, Ill have to talk to my manager
Offer a generous solution.
Give the customer options.
Be gracious whatever the customer decides.

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If the customer has decided to accept your immediate win back solution,
make sure you thank the customer. make the necessary changes to avoid this
situation with any other customers.

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Longer-Term Strategy Up Front: think from the customers perspective. Leave
the former client or customer with a good impression. Remember that even
though they may not be buying from you anymore, they will be meeting other
clients who may need your goods or services. Dont give them an opportunity
for negative word-of mouth.

Understanding of this customers current needs and a sense of trust:

Choosing the Appropriate Message, Media and Frequency: your goal is
showing that your product offers a better value than anything from a
competitor. You need to create a message that is both relevant and personal.

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2. Strategies for saving a customer who is about to defect: saving losing

Customer CPR :Once you have identified customers who are at risk of leaving,
then you need to apply customer CPR.

Comprehend: Listen to your customers. Let them rant, if necessary. In
listening, identify what triggered their dissatisfaction. It takes considerable
skill-and training-to handle irate customers tactfully.

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Propose: Ask the customers what they need from you to resolve the problem,
and to keep them as a customer. Three strategies-agreement, tentative
agreement, disagreement.

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3. Make your company defection proof:
Creating a Customer Information System: collect customer information with
each sale, through customer surveys, personal interviews, frontline dialogue.

Remember all satisfied customers are not loyal customers.

4. To create loyal customers, start with loyal employees: Some customer loyalty
studies indicate that staff turnover is given as the reason for
customer defection more than 50 percent of the time.

Teams can be cross-functional (involving employees from different disciplines)
or cross-trained (members are trained in several different skills).
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Following organizational structures are significant.

The Matrix Organization: Team members report to both functional and
hierarchical managers.

The Lattice Organization: Employees are organized solely around projects.

Flat Organization: Cross-functional teams are dominant, and there is a high
degree of employee autonomy.

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D.M. Sanath Dasanayaka.
University of Sabaragamuwa, Sri Lanka.
May, 2014.

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