Back to Blog
Unhappy man on thumb down giving bad review star symbolizing negative customer feedback, bad review or one star customer feedback, terrible or poor quality user experience
Business Growth

What Should You Do When You Lose a Customer?

One of the worst situations a company can experience is when they lose a customer. The impact of losing a big customer, one that has been loyal to you for many years, is always devastating. Even if there were a few signals suggesting the customer was considering canceling, the experience is never easy. Your company is bound to lose customers. It’s an inevitable part of the business cycle of keeping a book of customers. To get a running start and to prepare your team on how to respond to losing a client, follow these instant steps, strategies, and solutions that would help you manage what to do when it happens and know how to maintain your customer retention rates.

Steps to follow when you lose a customer

It’s easy for you and your team to be upset, frustrated, and confused about why a previously loyal customer pulled the plug and opted out of any further business with your company. You may not understand the exact reason why a customer cut off all business with you. Was it the change in price, marketing tactics, poor support and customer service, or different service procedures? Losing customers is an unavoidable part of the business world. Grasping onto why the customer left can guide you to leveraging how you can up the likelihood of winning them back or eschew making a redundant mistake with current customers. The following are some recommendations on the best course of action you can take for your company.

1. Don’t make impulsive, desperate choices

It’s too easy to make rash decisions in an unexpected situation such as losing a big customer. Stay calm and don’t do anything that you will regret or that will result in serious implications for your company. Take a step back and reassess where to place your time and energy into making sure your company doesn’t go down the wrong path in fixing the reason you lost this customer in the first place.

2. Thank your customer

When the customer has notified you they are canceling their services or you get a notice they have stopped doing business with you, reach out and thank the customer. By expressing your company’s gratitude, you are acknowledging you are extremely appreciative of the business relationship you had with the customer. A small first step like this can resonate with the customer and they may want to renew your services or resume purchasing from you. Then, take a week or so before circling back with the following next step.

3. After a week, follow up with a call

A follow-up phone call can go a long way, even more than just an email, and speaks volumes in presenting your company as transparent and dignified. Call the customer and ask them to clarify the reason they decided to quit doing business with you and your company. By calling the customer, you can easily smooth over issues or misunderstandings. You can provide a solution to an issue that hasn’t been resolved, which could result in the possibility of earning back their business and keeping this customer relationship.

4. Identify why they left

Figure out why the customer decided to cancel. Inquire about what went wrong and what pain points they had experienced that your company failed to address or any unresolved issues they had. You can directly ask the customer for a response through a call first. If they don’t respond on the first call, wait a few days, and then email the customer a brief feedback form on why they opted to cancel their service subscription or stop buying your products. The goal is to analyze the reasons that led up to the customers’ decision to end their business relationship with your company. Most importantly, this step is to continue to nurture a transparent, authentic connection with your departing customer, so that one day hopefully they return to your business as the full-time customers that they formerly were. Having said that, if the customer doesn’t return your call even after you’ve left a voicemail, you need to accept that the business relationship was not good, or if it was a short-term customer who had no interest in leaving feedback after being contacted.

5. Move on from repeating mistakes

If you tried reaching out to your lost customer or client and the outcome wasn’t what you wanted, realize that you tried your best to repair and win back a lost business relationship. Refocus your company’s team’s attention on your current customers. Look at this as a shift in goal setting and planning for acquiring new customers and retaining current ones.  

Ask yourself and your team questions such as:  

  • “Should we target and go after big customers/clients right now?”  
  • “What is our overall customer acquisition cost right now?”  
  • “What should be the procedure for when we decide to acquire a bigger customer lead and sell to them?”  
  • “How should we prevent losing these big types of customers?”  

Avoid depending on one big customer for a huge income from your sales revenue. If one big customer or client constitutes more than 20% of your total sales, this is considered client saturation. By avoiding client saturation, you are making it easier for your company to deal with the fallout from the potential loss of revenue from a former customer. Losing a customer with 3.5% revenue compared to 20% is a vast difference and a make-or-break situation for any business, one is eventually replaceable and will not drag your business into debt.

Strategies for retaining existing customers

A business should aim to retain customers most especially after the fallout of losing a customer. Here are a few strategies to employ for your company.

Reassess your business’s current roster of customers

Browse through your current customer base and seek out opportunities to increase a profit by upselling to or switching up the selling strategy to your current book of customers. Be strategic and look for cross-selling potential. Delve into strategically pinpointing which customers could benefit from having this service or another specific product/service.  

As reported by eCommerce upselling in companies, there is a high probability that this sale tactic will boost your revenue by 10-30% on average. The benefit of this is lowering your acquisition costs, leading to having a higher chance of reaching a sales deal. Strive for customer retention and consider customer lifetime value while lowering your customer acquisition cost, especially at a critical time when your business has lost a customer and even more so if it was a big customer. This is a great pick-me-up tip for a business struggling to get their sales and marketing stronghold at a high point again, creating newfound confidence for companies and teams to implement this into a quarterly strategic opportunity.

Request referrals

Consider asking your current customers if they know any related business in their industry or contrasting business that would potentially be interested in your company’s products and/or services. By diving into seeking out referrals, you can jump into referral marketing as an online avenue for reaching a wider customer base. Based on a study, 86% of customers highly trust referral marketing, meaning a consumer is 50 times more likely to purchase a product when it has been recommended by their family and close friends.


Refine your lead generation tactics

Apart from asking for referrals, you can investigate B2B lead generation strategies via inbound and outbound marketing. Initiating phone calls to get started with outbound marketing is a great start. Inbound marketing is the easier pick of the two. You can focus on acquiring leads through email marketing from customers signing up on through a form on your website indicating they are interested in a free eBook or by merely signing up for a newsletter to learn more about product updates or discounts with your company. LinkedIn is a straightforward way to generate leads, especially through a LinkedIn business page and paid media advertisements whether PPC or social media ads are a great start to gaining more leads for your business.

Solutions to increase customer loyalty  

Below are some solutions including the use of software engagement tools, that your company can consistently use to boost customer lifetime value and build customer loyalty.

Live chat and messaging tools

Communication tools such as live chat and messaging are a terrific solution to keeping long-term customers. For example, Velaro's Live Chat Software Solution provides your customer support and sales team with the ability to engage customers in real-time, quickly addressing issues, and responding to questions. This powerful tool provides a comprehensive, engaging customer experience that is foremost highly personalized. For eCommerce companies, chat agents can seamlessly guide customers through searches for pricing tiers, order issues, purchases, and filling out secure forms through co-browsing, avoiding shopping cart abandonment or losing opportunities from customers that had issues. For non-eCommerce companies, live chat is a terrific support tool for driving sales. You can advise your customers and website visitors about product information and solve questions about pricing, features, and solutions. Having a live chat button on a website provides an engaging environment for your prospective and current customers to connect directly with your company.

Gather and capture customer feedback

Surveys and pop-up forms are a good method for gathering and capturing customer feedback. Survey forms at the end of a live chat conversation are implemented for measuring satisfaction, the success of the customer-agent conversation, and understanding customer sentiments. This is one of the best ways you can continue to refine your company’s customer service and increase customer lifetime value.  

Another way to get customer feedback benefits is by asking for customer reviews via email campaign follow-up emails after a purchase. Customer reviews are the pinnacle of a public’s perception of a business and play a crucial factor in gaining new customers or potentially driving them away. If your company receives a 1-star review, for example, you can take this as an opportunity to apologize for the negative experience the customer received from the product/service or from the customer service itself. By responding to negative customer reviews, you are conveying to the customer who left the review and current/prospective customers you genuinely care about the satisfaction of each customer and want to bring them the best customer experience.  

By gathering feedback from surveys, pop-up forms, and reviews, you can discover deeper insights into what customers like or don’t like, then gather these customer opinions/sentiments to define how to maintain customer loyalty in your products, sales deals, promotions to provide an enriching and happy customer experience.

Create a customer loyalty program

Forming a customer loyalty program, such as a newsletter, does wonders for customer retention. This influences a loyal customer base and it can be a wonderful strategy for bringing in new leads. Discounts, membership rewards, and free products are what make up a strong customer loyalty program. You can even include gifts on members’ birthdays, VIP status, free shipping on eCommerce websites, future discounts and buy one get one free deal on purchases, or the latest product offers and “first looks” exclusive product deals for customer members only.  

Establishing and actively keeping an exciting loyalty membership program for existing customers is a sure-fire way to optimize customer retention and overall customer lifetime value. The more quality deals you provide to loyal customers, the higher the sales revenue will turn out. With a customer loyalty program that offers rewarding price discounts and freebies for current customers, this can lead to referrals to your company. Loyal customers will want to spread the word online about a positive customer satisfaction rewards program.

Take Away from Losing Customers

Losing a big customer or any customer for that matter can happen to any business. It is an inevitable circumstance and businesses need to be prepared to handle this crucial event when it happens. Preparing for and knowing what happens when this occurs, especially when losing a big customer, will create a sense of awareness for your company, so your team isn’t entirely blindsided by this situation. Your company needs to avoid having a complacent relationship with each customer wherein you never check in with them for feedback and the status of their account with you, as this can eventually lower customer satisfaction and drive away any of your customers.

By implementing the customer retention paths discussed above, you are aiming to ensure your company is keen on retaining and creating a loyal customer base because of the rewarding, pleasant customer experience you are establishing and continuing to improve upon.

Find out how to improve online customer satisfaction through online customer service in this next blog

Stay informed. Get exclusive offers and news
delivered straight to your inbox.

Thank you for joining our blog family!

As a subscriber, you'll get exclusive access to insights, expert tips, and more. Stay tuned for our upcoming posts.

Oops! Something went wrong while submitting the form.
Please try again, if the problem persists contact
We won't share your email address with third parties.

Explore more articles