How to Deal With 7 Types of Bad Customer
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Professor Merlin Stone the leading expert in customer
management, identifies seven types of bad customer.
Here we briefly look at each of these types of bad customer,
and consider what can be done to nullify the drain they place on the
resources of small businesses everywhere, by encouraging them to go
elsewhere or by getting them to pay for their bad habits.
Youíre not running a bank and nowadays there is much more
acceptance of businesses which donít offer credit terms. See if you can
change your payment strategy to take payment in advance or
automatically from customers, at least until theyíve earned the right
to a credit period. Increase your prices for bad payers or charge
interest or a penalty fee.
These characters cause you extra cost by changing their mind
at the last minute, or wanting something done differently with every
order. Think about whether you can keep records which will let you
second guess them, or if possible charge them more by having a range of
optional extras which cover their needs.
If you run an internet shopping site you know these well. They
return most or all of what they order every time. Try to educate all of
your customers on the costs of additional services such as order
returns, or penalise wasteful customers by making returns or order
Firstly ensure you have an excellent customer service regime
and put right any genuine complaints quickly and effectively. Make sure
though, that you keep records of complaints, and once you identify a
persistent moaner take appropriate action to charge them more or
encourage them to shop elsewhere. Remember the longer they shop with
you the more chance they have to spread bad press to their friends.
Whilst you donít want to discourage this group, you do want to
identify them so that you can avoid putting too much resource into
them. Remember that some low spenders will go on over time to become
prime customers, which is why banks put up with students for 3 years,
hoping they will go on to become high earners. If you have a group like
this, monitor them separately so you can encourage their development
Wherever possible make sure that you investigate your
customers as appropriate. If you can share data within your industry or
by using a reference agency you should do so. At least ensure you are
keeping records which let you monitor customer patterns and take action
if you see what you suspect to be fraudulent activity.
Donít waste your marketing budget on these customers. If they
never respond to mailers, or take up their vouchers, spend your
promotional pounds elsewhere.
So by keeping accurate records of your customersí activity and
spending habits, you can take action to make sure that your resources
are not wasted on your bad customers, so they can be used to encourage
your good ones.
About the Author
John Norton, is a senior business and
finance professional with a big four, blue chip, software and
technology background, and board level leadership experience in
finance, IT, operations, customer service and general management.
He is owner of No Worry Web, which creates and manages small
business web sites and social media presence, for an all-inclusive
monthly fee. For further details see www.noworryweb.co.uk
or call 0845 5191 275. Authors Google+
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Article Published/Sorted/Amended on Scopulus 2013-07-29 13:08:20 in Marketing Articles