--By Shrishti Giri--
Unhappy customers lead to increased churn rate, it is that simple. What needs to be explained is why they are unhappy? It can be your services, solutions, support or the overall experience they have while connecting with your business. Some organizations work immediately to fill in the new customers in place of the ones who leave and the other work on understanding the reason behind the churn and try to retain those customers.
Let’s see some facts before searching the answers for the question above.
According to the Forrester report, it costs 5 TIMES MORE to acquire new customers than it does to keep the existing ones. It will cost any organization 16 times more to bring a new customer up to the same level as a current one.
An average at 5% increase in customer retention rates results in 25% – 95% increase in profits according to Harvard Business School report. Not only this, in the US, companies are losing $83 billion each year due to high customer churn. The biggest effect of the customer churn is on the company’s numbers and of course, that is the biggest trouble.
So, let’s come to the question again, which one are you? Is your business capable enough to keep your customer base intact? Are you able to retain your dissatisfied customers? What are the reasons that are causing DSAT among your customers in the first place? These stats are enough to reflect that working on retaining the existing customers is the perfect way to increase revenue and become the industry leader. This depends entirely on the organization to focus upon and figure out how they can attract their customer base to stay with them.
Here are some influential ways that can help any organization to improve its customer retention process and control the churn:
1. Know the reason
This sounds quite obvious but it is the first and the most important step to know what instigated the customer to leave. The best way to connect and understand their pain-point is through a call. Did you know 68% of customers move on because they think a company doesn’t care about them? So, to make your customers believe in you a call with concern and the willingness to know their problem and solving it is necessary to stop the increasing churn. Make the customers feel that you think about them and they are very important to you. Use emails, website and chat options to keep on interacting with them and let them know that a human is interacting with them. Not sure how to start the feedback collection and analysing the Voice of customer.
2. Continuous engagement
Social media platforms have become a big source to generate a lot of customer engagement ideas but this is not enough. According to a study, email marketing and communication has been recorded as the most widely used tool to engage with the customers. For both B2B and B2C organizations, email marketing is one of the best platforms to keep engaging with the customers and build the right connections. Mails can be regarding the latest launches, offers, discounts but it is to be ensured that they are personalized and relevant to the user/customer because the mail sent might end up in the junk folder. To make it better study the targeted customer’s journey. Read more about customer journey mapping .
3. Customer Education
An informed customer is your loyal customer, so educate them as much as you can. Customers today are aware of the technology, innovation and cx management techniques used by the brands. Educating the customers about your products and services, telling them how and why will help them to create a better connect and they do not feel lost once they purchase any product or service. Relevant content matching to the customers’ needs in the form of blogs, emails, e-books videos etc. is a strong way to keep them inclined towards you.
4. Analyse the ones on risk
Above all, the best option is to prevent the situation before it even happens. Find out the customers who are at the utmost edge of leaving your brand. Connect with them immediately and look for the reason and solution at the same time. There might be a certain group of customers who are more prone to leaving and dissatisfaction maybe because they felt left out or were not contacted recently.
5. Incentives and offers
For brands serving the end customers directly, they must keep providing the incentives to the customers, the genuine ones. Offers and discounts are necessary but try to make them personalized and relevant for the customer you are reaching out. On the other hand make sure that the offers and discounts do not hamper your revenue, which means that the cost of your retention program does not outweigh your profits.
6. Customer Service
Did you know according to a Customer Experience Impact Report by Oracle, the two main reasons why customers leave any brand or organization are
• Incompetent and rude staff
• Unbearably slow service.
According to Forum Corporation’s Research, most of the churn because of poor service stands at 70%. Now, these stats are enough to express the importance of good customer service. Customers are very keen to be catered as special anywhere and everywhere they go.
In the end…
Besides the listed ways there are many other significant ways to control your churn rate. Well, now as you know that why controlling the churn rate is important, to stay motivated, note one more fact that 82% of companies claim that retention is cheaper and even if retention increases by 2%, it can lower costs by as much as 10%. Keeping your customers loyal towards your brand is not a day work, it requires analysis, relationship building over time and understanding personality. All this takes time, meanwhile ensure to make this timeframe valuable enough for the customers so that they not only stay but bring their friends and family too.