Companies can regain lost customers

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Jill Griffin
Jill Griffin

Can you sell to a customer who's taken his business elsewhere and regain his loyalty? Surprisingly, the answer is “yes.” Companies have a 20% to 40% probability of successfully selling to lost customers, according to Austin, TX-based loyalty expert Jill Griffin, bestselling author of three books on customer loyalty including Customer WinBack: How to Recapture Lost Customers – and Keep Them Loyal.

“Most firms consider the lost customer a lost cause,” says Griffin. “But research shows that lost customer represent a rich source of revenue for any firm.”

Griffin's client list includes household names like Dell, Microsoft, Ford, Marriott, HP, IBM and Sprint. Her books, including her latest, Taming the Search and Switch Customer: Earning Customer Loyalty in a Compulsion to Compare World, have been adopted as teaching texts by colleges and universities such as the University of Texas' McCombs School of Business and Northwestern University. Direct Connect talked with Griffin about customer win-back programs and their benefits.

Direct Connect: What is meant by “customer win back” and how does it differ from a “customer save?”

Jill Griffin: Win back is a process for recovering lost customers who have stopped buying your product or service completely. You “save” a customer from defection who is still buying from you but is showing signs of possible defection.

Direct Connect: How should companies determine whether to attempt to regain a lost customer?

Griffin: Two key concepts are important – second lifetime value (SLTV) and the reason the customer defected. SLTV is the [projected] value of the relationship once the customer is regained. Generally, you want to give customers with higher SLTV more win-back priority in regard to investment than those with lower SLTV. You also want to pay attention to the reason for defection. You want to target lost customers who are less likely to leave you again.

Direct Connect: After determining which lost customers are worth regaining, what do companies need to do?

Griffin: There are seven steps to take: Ask customers what you can do to win back their business. Listen closely to the answer. Meet the customer's requirements and communicate the changes you have made, then ask again for the customer's business. Be patient; some wounds heal slowly. Stay in touch with the lost customer. Make it easy for customers to come back to you, and avoid the “I told you so” stance. And when the customer returns, earn his or her business every day.

Direct Connect: Can companies gain a competitive advantage through an effective win back program?

Griffin: A combination of strong acquisition, retention and win-back programs can help you bullet-proof your firm against competitive attacks. Conversely, if your competition gets strong win-back programs in place before you do, your chances of recapturing and keeping the best customers are reduced considerably. Like other things in life, there's an advantage to being first. Win-back programs are no exception to that rule.


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