When sales people are asked “Why does a customer buy again?” most will reply “Because they are satisfied!” However, as sales training professionals tell us, satisfaction is just one necessary condition for a customer placing a second order. Other factors, such as the performance of competitors or the costs incurred by changing supplier, also influence the client’s decision to place a second order.

So why does a customer not buy again? Because they are not satisfied! In a survey salespeople from mechanical engineering and electronics companies were asked about the reasons for customers defecting to their competition.

The sales people gave the following four reasons for migration as most important:
1. the price
2. the after sales service
3. the product quality/performance data and
4. the delivery arrangements.

The very same sales people also believed customer dissatisfaction was most frequently caused by: 

1. the quality of delivery (in particularly delivery date),
2. the product quality (this included products purchased from a sub supplier (‘original equipment’),
3. the price (including the after sales costs),
4. the quality of services,
5. the after sales service,
6. the conditions of guarantee.

About one third of salespeople assumed that customers break off a business relationship first and foremost because of price. Sales people constantly give price as the primary reason for customers going over to the competition as it is easy to justify losing on price. Interestingly, Professor Dr Wulff Plinke of Humboldt University in Berlin, came to a similar conclusion in a study he did where he found industrial sales people generally gave price as the biggest reason for losing orders.

The reasons behind the over emphasising of the role price plays on losing orders by sales people may be related to the fact that the price decision is usually towards the end of the buying process. This makes it easy for a buyer to give the impression that the decision to place the order is dependent only on the price. Also, in the final analysis, the sales person has little or no decisive influence over the price level - giving another reason why this is a favourite excuse for losing an order (defensive function).

Whilst price is often given as the reason for losing the order, a sales training expert provides another possible reason. Sometimes the client changes because the sales person has not made it clear to them just how costly it would be for them to migrate to a different supplier!

If we want to really understand the reasons clients are lost we must be careful of not over emphasising price as the main reason for clients moving to the competition. The real reasons become clearer when we look again at the causes of customer dissatisfaction given by the salespeople who took part in the survey. According to the salespeople asked, price actually comes third in the list of reasons. More frequent causes of customer dissatisfaction are delivery-related matters and product quality issues.

A lack of after-sales service (which was mentioned by a third of those responding) is just as important a factor as price when it comes to customer migration. Interestingly this factor is not seen by the sales people as a major cause of dissatisfaction.

When it comes to examining client dissatisfaction, relational aspects are not mentioned as much as ‘tangible’ problems. Whereas a client will readily complain about ‘essentials’ (such as a delay in delivery or the fact that the client’s delivery commitments have not been fulfilled) a customer’s dissatisfaction with the level of client care they receive rarely becomes the subject of a concrete complaint - although this lack of care will also induce the customer to change supplier.

The salespeople surveyed mentioned product quality as both a reason for customers seeking to buy elsewhere and as a cause of client dissatisfaction. The salespeople believed that there was more dissatisfaction about hardware performance than dissatisfaction about the price or the level of after sales service.

The most frequent cause of customer dissatisfaction reported was to do with problems keeping delivery deadlines, although only 10% of the salespeople asked believed that this would lead to the customer changing supplier. Delivery delays, according to the sales people, is certainly seen as a problem, but it was also seen to have a minimum bearing on a customer’s decision to leave or stay with an existing supplier.

The sales people hold similar views on the two dissatisfaction factors ‘quality of service’ and ‘conditions of guarantee’. These factors are hardly seen as a reason for a customer to go elsewhere, the reasons behind this view appear to be related to the idea that clients are obviously ‘accustomed to problems’ - even from alternative suppliers.

To summarise, surveys of salespeople on sales training courses show that the importance of price is often over emphasized by them as the reason for losing customers. They tend to down play some of the other aspects causing client dissatisfaction. However, if these other dissatisfaction aspects are ignored they will, ultimately, lead to the client changing supplier.

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