Burned Customers

As vendors tune in to the notion of relationship marketing, the focus seems fixed on the future - and while I accept the notion that the past cannot be changed, no use crying over spilled milk, and so on, to completely ignore past interactions with a prospect or customer is to overlook barriers to forging a future relationship that must be addressed before the relationship has any chance of moving forward.

The list of individuals a company has "burned" is of little consequence to the mass-media marketing approach: it's generally accepted that a mass-broadcast message is going to reach a large portion of people who are not going to be receptive to the message - whether it's because they have had a negative experience with the advertiser, they find the advertisement itself to be offensive, or do not have the need for the product or the means to purchase it.

However, a one-to-one marketing approach, enables communication to be tailored to the individual (through live sales representatives, telemarketing, direct mail, and new media), companies have the ability to control what they communicate (and decide whether to communicate at all) to each person they intend to reach.

At that level, campaigns can be segmented to the key audiences: to eliminate those who are not prospective buyers, to seek to gain the business of a qualified process, and to seek to improve the relationship with an existing customer, with an eye toward expanding breadth and frequency of purchase.

The list of burned customers should not be lumped into the individuals who are not prospective buyers. Because they once purchased from the advertiser, it's clear that they have the need for the product and the means to obtain it - and as such, they should be considered as attractive a market as any other qualified buyer.

And it's worth noting that not every former customer is a burned customer: some of them have simply taken their business to another provider who, at least for a time, offered a better price or desirable features that were unavailable with the original provider. There's much to be learned from former customers - but that's beside the present point.

Burned customers are an entirely different species: they weren't lured away by a better offer, and I suspect that in many cases they have accepted an inferior one, because their motivation was not to seek out a better relationship, but merely to get out of a bad one.

My sense is that winning back a burned customer is a topic that authors and theorists avoid because it's a very touchy situation, and very difficult to negotiate when you're starting from a disadvantage. But it's also my sense that, if you can get this "right," restoring your relationship can do much for your overall reputation.

At the very least, making amends with a burned customer will decrease their incentive to spread negative word-of-mouth, but it's also akin to a service recovery, and I suspect that if you can manage to win back a burned customer, they will become a very good customer and a staunch advocate.

I'll keep my eyes out for an article or book that examines this phenomenon. I've not seen one to date, and I expect that, since companies are new to relationship marketing, there are still many low-hanging fruit among the population of customers they have not yet burned. But as the practice expands, and the crowd of prospects who aren't already engaged to a competitor becomes thinner, there will be greater interest in pursuing this segment.