FREE Cost Of Lost Customer Calculator

When into business, you’ll lose customers. And sometimes you might end up losing your potential customers. Now, this loss can directly impact your business growth.

So, one should use the cost of lost customer calculator to answer a few of its questions and find the cost of losing customers.

What is the Cost Of Lost Customers?

The cost of a lost customer is a measure by which you can identify the impact of losing customers.

Now, with the loss of this potential customer of yours, you will incur a heavy loss. You might not find the loss when you calculate it monthly, but when compared with the number of purchases the customers make from your store, or might do from your store in their lifetime, you will find that you lost a huge amount of money.

Since every small or big company has to endure losing customers, on a regular basis, entrepreneurs should use the cost of lost customers method, to find the total loss.

How do you calculate lost customer value?

To calculate the total lost customer value, you need to find values for several variables. Below attached video can also clear your doubt on how to calculate the lost customer value.

First, if you wish to find the value of your lost customer, you need to learn how many times the customer visits your store. Also, look at how many years can they do business with you. In most cases, the average life span of human beings is considered.

• First, you will have to find the total lost revenue in one year, on losing your one customer, using the cost of lost customer formula.
• Then, you need to find out, how many other customers, can abandon your store, due to a bad customer experience. (From research, a customer with a poor experience can talk about it to at least 7 people. So, you will be losing 7 potential customers.)
• Now find out the total lost revenue in a year, including your one lost customer plus the other 7.
• Finally, now you will find the total lost revenue.

Cost of Lost Customer Formula

Cost of Lost Customer = Number of times the customer visits your store (x) * Average amount of business done with you each time ($y)

Cost Of Lost Customers Example

For example, let’s say one of your customers visits your online store two times a week and purchases your product for $5 every time the customer visits. Now if they decide to abandon your store, then you will be losing, $10 of business a week, and $500 of business in a year.

If the customer, refers to at least 5 people outside complaining about your store, you will be losing 5 additional customers, losing 5*500 = $2500 business a year.

Again, if the customer, shares their bad expression on social media platforms (for example Facebook), then you will be losing more customers. It is assumed that almost every user on Facebook has at least 155 friends.

So, if you lose 155 additional customers, you will be losing $3,87,500 in business a year.

How To Use The Cost Of Loser Customers Calculator?

To use the cost of lost customers calculator you can follow the instructions given below.

1. You will find questions like the cost for each sale, how many customers you receive yearly, the total number of referrals your customers provide, or questions about how many referral visitors become actual customers.
2. After you answer all of these questions, click on the Calculate button, and it will generate the result.

Before you use the cost of lost customer calculator, there are a few things, that you need to learn about. Firstly, you need to have a detailed idea about your customers and audience.

Without having the proper idea, you cannot use the calculator effectively. Use the different data generated from your online store’s progress, and use the variables to find the actual cost of a lost customer.