Customer attrition or churn is a term that most entrepreneurs and marketers fear to talk about. It usually happens when a customer stops using your product. It is discussed in low tones because its repercussions can be felt immediately. One of the direct effects of attrition is the loss of revenue. The worst-case scenario of churn is when customers run to your closest competitors.
So how do you reduce the customer churn rate (the percentage of customers that leave your business over a particular period)? Here are some of the best tips that you can use to deal with this issue:
Focus on the most vulnerable customers
While you are sitting in your comfort zone knowing that everything is well, a group of customers may be planning to make a grand exit. Instead of giving each customer equal attention; try to focus on those that are vulnerable.
The most effective way of doing this is by dividing all the customers into different groups. From there, try to identify the group that is likely to exit. Pull all your attention on this group and try to win their hearts. Engage them and strive to gain their confidence. This tactic will help you to put your effort where it is needed most.
This applies to many life situations. We tend to be complacent after establishing a relationship with other people. We stop sending those texts and wait for them to do it first. If you are treating your customers in the same way, you should know that the days of your relationship may be numbered.
Instead of waiting to react, try to be actively involved in their lives. Inform them about your new products or the changes that you have implemented in the commodities that they bought.
In case you are experiencing some technical hitches with the product, be the first one to pass the information rather than wait for complaints.
Offer some incentives
Goodies such as discounts, promos, and loyalty programs have the power of making customers stick to your business. Your existing customers won’t see the reasons for going to other shops if you are offering something extra. Although they may look small, incentives have the power of melting someone’s heart. In doing so, they become loyal to your business.
When it comes to reducing churn, you need to be keen on the time that you introduce the incentives. If you suspect that a customer is about to leave your business, probably due to the expiry of the contract, introduce some offers. This will make them reconsider their decision of churning.
Give your customers a clear roadmap
This tactic comes in handy when you have introduced a new product on the market. A good percentage of your customers may face some obstacles while trying to use your product. If this happens, they will become frustrated and abandon it midway.
Do not assume that your customers are smart and will be able to navigate in the software, mobile app or any other technical product easily. Design a roadmap that will teach new customers how the product works. An onboarding process will also manage their expectations as they will know the things that they should expect from the business or product.
Analyze the churn
Probably a good number of customers have churned out before. Did you learn anything from the process? If not, then you are walking on a dangerous path. Analyze the factors that contributed to the churn. From this, you will be able to build new strategies that will help to reduce the churn rate in future.
Allow customers to give feedback
One of the common causes of customer churn is the constant frustration that they experience. If your customers are continually frustrated with the product that you are offering, and there is no way of communicating to you, they will definitely abandon the train.
Build a transparent system that will allow your customers to give their feedback regarding the issues that they are facing. Do not stop at reading the feedback; show them that you are putting some efforts to solve the problem.
Evolve with time
One of the things that have killed many businesses is the failure to change with time. The advancement of technology requires that you keep updating your system to match with the new changes. Customers are always yearning for new things, and if you stick to your old ways of doing things, you will end up losing them.
Customer churn can make you veer off your business goals, and that’s why you need to stop it. However, some factors may be beyond your capabilities regardless of the efforts that you put. The above seven tips can help to cut down the rate of customer churn.