How To Reduce Churn? | Fighting Churn and Building Loyalty [Part 3]
How to Reduce churn?
Is it possible to reverse the effects of the churn phenomena?
Many questions can be asked about this issue, and many experts do an amazing job in fighting churn and turning any angry customer into a happy and satisfied one.
In this part of the series "Fighting Churn and Building Loyalty, we will talk about some practical ways for reducing the churn rate.
This is not the only recipe for success but I will go a long way into saving customers that will potentially leave you for a competitor.
Analyze !
This can seem very obvious. Any company needs to find out the main reason (or reasons) making its customers leave.
The easiest way to get some "on the surface" information is simple:
Talk to the customers!
Call your customers. No emails or anonymous surveys.
This personal touch will demonstrate how much you care about them and it will give a personal and caring touch to the "soulless” Business-Client relationship.
But there is a trick here: You should not call each and every customer. This method is meant to just scratch the surface and get some insight directly from the people making money for the company.
There are 3 main questions that you need to ask and that you need to get as much information about them as you possibly can:
- Why did they leave?
- What did they think about the service or product when they first became customers and what do they think now?
- What was the only little thing that could have prevented them from leaving if it was provided?
This valuable "Microscopic" feedback will serve you very well in quickly evaluating the direction of your retention strategy and the fast actions you need to take immediately (the 3rd question is the answer)
Engage !
The second thing that can help you prevent customer churn is to engage your customers with your product.
Give your customers reasons to keep coming back . This can be as simple as day-to-day tips and help about your product and services.
This kind of engagement can be achieved by providing full and clear information and content about the most important functionalities and uses of your product or service. Regular updates are very appreciated, about special offers, new functionalities...etc.
You can do it using the email channel (but please do not abuse it ! ) On your website, social media pages and after any support call made by the customer .
Educate !
This point is correlated with the above point. You have to provide enough good quality material about your products and services to your customers.
The 500 pages user guide and the endless self-help section of your website will hurt you even more.
Education here is divided into two categories: Education about your product features and education about the market and how well your product is positioned compared to the competition.
Phrases like: “The fastest internet in the market” or “The best camera in the world “…etc. are very attractive for customers.
But you should of course have the Best product, or everything I am saying here wont matter.
Know !
There is always a subset of your beloved customers that is more likely to go away than others .And as a business, you should know these customers even before they think of leaving you so you can act immediately and retain them.
Identifying customers that are very close to the “risky” edge is not so complicated. For me personally I believe that the first sign of a customer at risk of churning is a voiced complaint. Customers that care enough about your product or service will contact you and start complaining when they feel that they are not getting their money’s worth.
Building complex churn prediction models is a deeper way of looking at this problem. But here I am trying to find the points any company can handle very quickly.
These things can be done in less than 24 hours, and the results are fast and easy to measure.
Define !
Not all customers have the same value to us. I am not saying this to minimize the value of each and every customer. But let’s be real, the Pareto principle apply in every Business situation.
We all know the situation where 80% of your revenue is generated by 20% or less of your total customers. As a smart Business, those 20% should be treated in a very special way.
Priority in customer support, complementary features and free benefits, invitations to special events or exclusive product releases are all things that are easily implemented and can have a huge positive impact in reducing the churn value on your revenue.
Offer !
Another Way to do things is to offer very interesting but simple incentives to all your customers based on their life time value, tenure and other customer related information
In the other hand, you have to be aware of what you are offering. You should not in any case cannibalize your revenue by giving free stuff that the customer could have paid money to get.
Give !
Obvious?
Yes it is very obvious for me to say this. But many business put this at the bottom of their priorities.
No matter how much cost and investment you will put into it, improving your services and the quality of your product will be an automatic churn prevention tool.
Pay Attention !
Complaints are like tips of the icebergs – they suggest that the bigger part of the problem is hidden from your view. Did you know that 96% of unhappy customers don’t complain, and 91% of those will simply leave and never come back?
So, you’d better take complaints seriously and act on them, and in this way prevent customer churn, because, as Strauss & Seidel claims, dissatisfied
Finally:
It is your job to make your customers happy and satisfied. It is your job to improve the quality of your product or service and it is your job to make sure that all the above points are treated with care and all churn prevention actions are prioritized!