For every action, there’s an equal and opposite reaction.
For instance, it was fun eating the Halloween candy you should’ve been handing out to trick-or-treaters.
But, a rumbly tummy and eggs all over your house are natural parts of the reaction.
Among those of us in Customer Success and customer loyalty, the same thing applies.
If acquiring and thrilling customers is our main action, then finding and dealing with bad customers is just as important.
It’s not fun. In fact, it stinks. Bad customers are still customers after all, and they’ve willingly agreed to give you their money.
As profitable and valuable as loyal customers are, bad customers can be equally as damaging. They're costly to service in both dollars and hours, and in the end they’re likely to damage your brand and reputation.
So someone has to deal with them.
In most organizations, this is going to be your duty as the person responsible for engagement and retention. Everyone in an organization is responsible for the customer experience, but you’re going to be the one to decide who is and isn’t worthy of a company-wide investment.
How do you recognize a bad customer? How do you decide who should and shouldn’t get your brand’s devoted love and affection?
Start with these five criteria.
Five Traits of Bad Customers
1. They’re High-Touch and Low-Profit
We’ve all worked with customers like these. They don’t pay much and expect constant service and all hands on deck at their beckon call.
They’re the most obviously unprofitable because they take so much time and effort. They’ll circumvent your standard service structures, opting instead for directly calling managers or executives, which makes things even worse.
Whether it’s your fault or not, their expectations are ridiculous and unattainable. And if you don’t rein them in, they’ll eat up your resources - and patience.
2. They’re Bullies
Sometimes high-touch customers become belligerent. These are the yellers and screamers, the ones who throw fits and hurl personal insults at your team.
When they don’t get their way, they'll find someone else to yell at - sometimes going into an online public forum.
As has been said on this blog before: always respond and offer to help, and when the time comes, politely decline their business, refund their money when possible, and send them on their way. Your business and staff deserve better.
3. They Always Move the Goalposts
These customers are often quiet, or at least reluctant to provide straightforward feedback. You may not hear from them until they’re grumpy. This can happen even if your product or service is doing what it’s supposed to.
Sometimes a customer isn’t going to be happy no matter what you do. In some cases they’re getting the results they want but are afraid to tell you in fear that you might raise prices or stop performing for them.
Most likely, they’re wanting to renegotiate terms when you hear from them. They’ll nickel and dime you every chance they get.
A customer that refuses to agree to goals, or isn’t willing to set a regular checkup, is unlikely to ever be satisfied.
4. They’re Not In Your Ideal Segment
One of the major goals of a Customer Success effort is creating replicable systems. That means finding the clients who get the most from your business with the least amount of effort, and scaling that throughout industries and regions.
This doesn’t mean you can’t succeed with a client that doesn’t fit your profile. The odds of replicating their success are slim and the endeavor would probably be unprofitable in most cases.
These clients just may not be a fit for your best Customer Success efforts. Give them a good experience; just keep your best efforts focused on your best customers.
5. They Expect You to be a Vendor, Not a Partner
We talk about this concept on our employee engagement blog frequently. Your customers need to understand that they’re entering a relationship when they sign on with you.
This is especially true for membership, subscription, and B2B services. You’re not a vendor - you’re a partner.
As such, you work together to identify what success looks like and what steps need to be taken to get there.
If they’re expecting to just be served and have results magically appear on their doorstep, that’s not going to work long-term.
Success almost always comes from a combined client-vendor effort in pretty much every industry.
If the customer wants to dictate to you what needs to be done, that won’t work either. They need to be open to your expertise and best practices.
Wait, Do I Need to Kick These Customers to the Curb?
So the next question you probably have is what to do with all these crappy customers. Do you just fire them proactively and send them on their way?
No! (Well, the ones who don’t pay and those who are bullies to your team, yes!)
Of course you want to keep their business, but it must be on your terms.
That means they’re paying a fair price for your products and service and using them in the right manner.
It means they recognize clear goals and have fair expectations.
- Create tiered levels of service, so high-touch clients will need to increase their investment if they want hours of your team’s time.
- Designate a clear contact process, including whom the customer should contact for help, as well as set a regular meeting for status checkups and fine tuning.
- Work with the customer during the sales and onboarding processes to set expectations and realistic goals.
Sure, they’re highly likely to churn eventually. That’s okay.
As long as you’re taking care of your true ideal customers, you’ll replace bad business with good business and continue to increase your reputation and profitability.
Just be sure you’re still giving these customers a good, fair experience, so that they’ll be advocates, or at least not detractors. Don’t ignore them or make them feel like second-class citizens.
Another key point is to work with your sales and marketing teams to be clear about what good prospects and bad ones look like.
Help them focus their efforts on bringing in as many of the good ones as possible and sort out bad ones before they ever enter your system.
It’s Up To You!
No company will ever have a roster of perfect, ideal customers. There are always going to be some that give you trouble, and some that are definitely not profitable.
The key is identifying which ones are worth the burden.
Can their behavior be changed without a ton of effort?
Are they high-potential and will eventually become a star customer?
There’s no real formula you can use to identify who’s worth keeping on.
That’s up to you. It’s your job to identify your best targets and build out an engaging customer journey that will help them thrive.
And sometimes, it’s your job to let some of them go.
Topics: Customer Success