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Answering this critical question will not only aid companies in determining when customers are leaving, but how they can stop the exodus. Here are the most common reasons customers are leaving:

1% Death
3% Moved Away
5% Bought From a Friend
9% Went to a Competitor
14% Price
68% Perceived Indifference

Although these reasons seem obvious, the motivations behind each of them can be distilled into 3 factors: price, product, and treatment. Each category is significant in customer retention, but how do you identify which category each customer falls into? It’s simple, really: listen to your customers and pay attention to the data.


Price is always a sticky subject, especially when the customer and company are often at odds about the definition of the “best value”. The customer wants to find the best product for the lowest price, while the company wants to increase profitability. How do you know when your price is too high?

The customer tells you: Some customers may cite a price as a bargaining tactic, but when this becomes a common issue voiced by your customers, then it is time to reevaluate your pricing structure.
Certain Products Have High Abandon Rates: This is especially important in a heavily saturated market, but if certain products are consistently abandoned in online shopping carts, then price may very well be the reason. Studies show, of customers who abandoned items in their shopping carts, 48% felt the cost was more than they wished to pay, with another 57% not wanting to pay shipping costs. When customers aren’t hitting that “check-out” button, it is time to figure out why.


Customers often seek the lowest price for the best product, but reality does not always offer that advantage since price tends to correlate to the quality of the product. However, there are ways to determine whether it truly is a quality issue rather than a price issue. How do you know if the quality is unsatisfactory?

The customer tells you: Whether in-store or online, listen to your customers! This doesn’t just relate to customers who go directly to you. In fact, a very small number of customers actually make formal complaints (around 6%). 31% tell family and friends, leading to 48% that will avoid companies based on those bad experiences.

High Return Rate: About half of clothes bought online are ultimately returned to stores because of fit, which is a legitimate reason. However, what if computers, tablets, home furnishings, etc. are consistently being returned? Pay attention to return rates and the motives to determine why certain products are being returned.


Although all three categories are important, treatment of a customer is ranked number one, with 70% of the buying experience based on how people are treated. Poor treatment, and the failure to address problems in a timely manner, will significantly lower a company’s rating in this category. 78% of consumers have bailed on a transaction because of this. How do you know if your customer service is failing?

Customer reviews: Reviews are often underrated, but they are critical to pay attention to. 24% of Americans post online reviews and over 1 million people view tweets regarding customer service (with around 80% being negative). People are twice as likely to post about a negative experience as a positive one.

Customer service performance: Whether you are using chat, video, or a call center, pay attention to the data. Are customers waiting too long to reach an agent? Are issues being resolved promptly? Are agents knowledgeable? According to a study by Harris Interactive, consumers say customer service agents fail to resolve their issues 50% of the time, with 75% saying it takes too long to reach an agent, and 67% hanging up because they couldn’t reach an agent at all.

Like everything in life, you can’t start to fix the problem until you understand what’s causing it. Hopefully, this list can help you in your quest to retain and delight your customers.

Want to prevent customer churn? Start here.


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