Glenn Mountney of Valeting Direct is a small business owner who has been valeting cars for more than 20 years.

He no longer advertises, has a two-month waiting list and a 75% customer retention rate. Many clients stay with them for more than eight years.

Their secret- a deep understanding of the lifetime value of a customer.

This prompted me to ask the question –

Why is it that some of the more prominent companies are poor at customer service and retaining customers?

Having set out to change my internet provider, I researched and found I could make a substantial saving if I switched.

Armed with this information, I called my existing provider and asked about their new offers, and predictably, he said the latest deals are only available to new customers.

He said, “Don’t worry, I can do you a good deal,” which after much tapping away resulted in a paltry reduction of my monthly subscription. Even he knew that was ridiculous, and it confirmed my decision to leave.

Fast forward two weeks, and I receive a text to say, “Sorry you’re leaving, please call us on xxx. See your email for full details.”

I read the email in astonishment, thinking, are you serious? Do you really expect me to call you?

I firmly believe that if companies understand the concept of customers’ lifetime value (or trained their staff to know how important it is), they would not be so casual when handling complaints or the customer decides to leave.

Admittedly, some of the big companies fully get this which is why they have a retention team.

I advise business owners, who may be consultants, hairdressers, web designers or caterers, that if you have a customer who regularly patronises your business and, on occasion, they are unhappy, remember their lifetime value and do your best to resolve that problem.

Because if that customer gives you repeat business and is an ambassador, their value far exceeds what they are paying on that occasion.

Independent professionals (like the planning consultant I mentioned in my other post) and other small business owners often overlook this.

I had the same barber (when I had hair, that is) for more than 15 years, and at roughly £15 a haircut – you do the maths.

Glen is now cleaning the cars of his customer’s children.

Knowing the value of your services or how much you’ve improved your client’s situation is essential, but what is equally important is understanding how valuable they are once you have retained them.

The funny thing is if my supplier had called and asked why I was leaving and provided an attractive alternative, I would have reconsidered.

So, the next time you have a problem with a client, think of their lifetime value before you let them walk out the door.

If you are frequently under-quoting, struggle with writing proposals, and undervalue what you do and your customers, get in touch.