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3 tell-tale signs of client defection

3 tell-tale signs of client defection Tom Cates

Client retention is an important skill for any company in the digital B2B space. Yet many digital agencies and product vendors fail to recognize that to reduce client turnover, they should not treat all of their clients the same way.

For example, suppose nine of every 10 of your company's clients are completely satisfied. In most businesses, that would be a home run. But what if that lone unhappy client represents a third of your total revenue? The reality is that averages, aggregates, and trends mean little when it comes to managing client relationships.

The challenge of client retention is exacerbated even further by the fact that the digital marketplace is more competitive and more connected than ever. Digital business leaders tend to be prolific networkers -- it's extremely easy for your clients to identify a new provider and take their business elsewhere.

Consequently, client teams need to place a stronger-than-ever emphasis on individual relationships by recognizing problems when they arise and anticipating issues that may have an impact down the road.

In particular, digital client teams need to look for three glaring signs of potential client defection:

You're not on your client's speed dial

When your client has a support problem, a service question, or needs to talk over an issue, do they call your team first? If not, then your company isn't the client's trusted advisor -- and in the digital marketplace, that means you're missing out on opportunities to expand your client relationship and leverage high-profile engagements to acquire new clients.

What you can do

Instead of kicking yourself because your client isn't calling you first, take the advice of Dan Heath, author of The New York Times Bestseller "Switch," and "find the bright spots." Figure out who they are calling and how they helped solve your client's problem. If you're unsure how to find this information, start by touching base with your client on a regular basis. We've found that trusted advisors are nine times more likely to get the first call. If you settle for second, you may be facing an imminent defection. 

Your client uses the "F" word a lot

If you notice that something is off with your client and you're savvy enough to ask them for feedback, beware the dreaded "F" word. When a client says everything is "fine," nothing is further from the truth. This dirty four-letter word signals disaster and should be translated to, "Everything is not fine, but I don't want to get into the details with you because it's not worth my time."

What you can do

Gauge your client's true feelings based on their "vocality" and "emotivity." When the client provides feedback (particularly in surveys), what are they really telling you with their word choices and tone? In a study of more than 2,000 cross-industry, high-value business-to-business buyers, the most loyal clients said 150 percent more positive comments on what their representative was doing well than those with the least loyal relationships. Loyal clients will also point out specific examples of what your team did well. A client at risk of defection may not provide feedback at all, and if they do, they may use the "F" word, an indication that they are past the point of working on this relationship; they may be already searching for your replacement. To insulate your firm from "F" word sentiments, routinely ask your clients to offer suggestions and feedback, emphasizing that you want to hear the good, the bad, and the ugly -- whatever it takes to help your company do a better job.

Your client is uninvolved and disengaged

A happy client will provide all the information necessary for you to do your job well. If you have equipped them with the digital products and services they need to succeed, they will reciprocate by providing you with information and actively engaging with your business. But when a client begins to withhold important details, "forgets" to copy you on an email, or stops contributing their ideas, you should be concerned. Relationships are a two-way street, and if your client isn't fully invested, they might be on the road to defection.

What you can do

To remedy the situation, look for ways the client can invest in the relationship. If you find yourself constantly leading the conversation, try providing them with information they need to contribute so you can arrive at an idea or solution together. Make it crystal clear that their opinion is critical to ensuring the project stays on track.

Understanding these three signs of client defection will help you identify what to do if you suspect your client is unhappy. To prevent defection, remember that what works for some might not work for all. Forget about averages and take steps to create meaningful relationships with your clients today.

Tom Cates is president of The Brookeside Group.

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"Clouds in the shape of a three" image via Shutterstock.


to leave comments.

Commenter: Tom Cates

2012, September 17

Thanks for your comment, Nick. I completely agree. If your client goes silent, it could be an early indicator of a worsening relationship. If they're not responding to you, they're still sending a message by not communicating. You can get ahead of the curve by scheduling times throughout the year to collect client feedback. If your clients know that you want to hear their opinion formally, they may be more likely to provide it informally as well.

Commenter: Nick Stamoulis

2012, September 17

I've found that when a client goes silent it usually means the beginning of the end. We don't need to have an hour long conference call every day but if they stop responding to emails time and time again I start to brace for the worst.