It’s not just how you attract new customers that matters. How you part with those you can’t help is just as important. Here’s why.
Two years ago I went shopping to lease a new car. After doing all my internet homework, I went out for a day of test drives. Hopping from dealer to dealer, I tried different potential models. Everyone was more than happy to let me drive their car, so they could attempt to drive a hard bargain after. That is, until I met the saleswoman at Cadillac.
As a sales trainer myself, I really enjoyed her technique. Before leaping for the test-drive keys, she sat me down and asked a number of really important questions. The most critical was: What’s your real, final, monthly budget? When I told her my figure, she smiled and said, “Matthew, I’ve got to tell you up front. We don’t have anything even close to that number. I’d really hate to put you into one of our cars and have you like it only to find out you couldn’t afford it.” She then recommended two other places on the auto-mile that would more likely have models within my budget goals.
I thanked her very, very much.
What a refreshing, wonderful experience for a salesperson to have enough respect for her products and her time, and likewise respect me enough to be upfront right from the beginning. Rather than waste our time, then go through the emotional cycle of raising – then dashing – my hopes with her product, she did the right thing: She let me go. She knew she couldn’t meet my goals or needs. She didn’t want to leave a bad taste in my mouth. She respected my potential for business – perhaps in the future – enough to let me go today.
Boy, do I wish more salespeople – and their organizations – were like that.
Actually, I just wish TMobile were like that, today. More broadly, I wish every company that uses a “subsidy-and-cancellation fee” were like the sales lady at Cadillac. Attracting customers with an ultra-low initial price, like subsidizing a cell phone, then hitting them with an early cancellation fee later, is a losing strategy with modern customers. I’ve never heard a single one say, Parting was so much fun! Subsidy models are failures because any good will generated at acquisition or during loyal years is destroyed at termination.
Not just destroyed: irrevocably ruined.
After many years as a business customer with TMobile, I decided to move on. More international travel, the desire for an iPhone, and worries about their operational future as a carrier prompted me to move to another carrier. For a long time, I was happy with TMobile. They met my needs, had cheerful support and mostly offered a good rate. But my needs and desires have grown, while TMobile hasn’t.
Today’s parting has wiped out everything I liked about TMobile for years. Any good will has been washed away with the arrival of my $600-plus-tax termination bill. That’s $600 to cancel three accounts – a Blackberry which I paid full price for out-of-cycle, a G2 similarly paid in full, and a basic flip-phone that didn’t even do texting. By my calculations, I didn’t “owe” T-Mobile any subsidies. So the fee rankles. It’s a weak-way retain customers, ending with a slap in the face to anyone whose needs can’t be met by their offerings any longer. Especially since I know right now they are offering a no-fee-super-deal-something-or-other to a someone who hasn’t even paid them a dime yet.
New customers: we love you. Customers we can’t serve any more: Talk to the hand.
Actually, just one finger.
The difference between my Cadillac and TMobile experience is a model for every business. How you part with customers is just as important as how you acquire them. Sometimes, customers just move on; for lots of reasons. They’re customers; they don’t have to explain. But how you treat them when they do – well, that says everything about your organization. They say first impressions matter, but last ones are possibly more important. Companies that care little for loyalty – offering better deals to new customers and painful partings to existing ones – have their priorities backwards. Customers switch vendors all the time – it’s the meaning of an internet-empowered consumer. Possibly, they’d switch back someday, too. I may get a Cadillac someday, when my budget changes.
At least Cadillac’s salesperson left the door open, with a graceful parting. As for TMobile, let’s just say there’s very little possibility I’d switch back; even if they offered a better price and the greatest technology, it would be very hard to overcome the feeling that last time, our parting was not even sweet – just sorrow.