Reducing customer churn is critical to the growth of your business. You cannot offset lost customers by adding the same number of new ones; growth will be stagnant, but you will also be spending more to acquire the new customers, which means that your profitability will be negatively impacted. If you want to launch a war on your churn rate, the following tactics can help you win the battle.
- Make a great first impression. It only takes a few minutes for a prospect to evaluate your service or product. Focus on delivering your best proposition up front so that you can secure their full commitment. Educate them on the value of what you have to offer.
- Promise less and deliver more. There is perhaps nothing that can raise your churn rate more than failing to meet customer expectations. Conversely, when you exceed their expectations, customers tend to reward you with their loyalty. As one long-time sales representative put it, you must learn to profitably delight your customers.
- Make sure that you are always adding value to your service or product. This does not mean that you must always be offering new features. It just means that you need to differentiate yourself from your competition by giving customers something that they cannot get anywhere else. Perhaps it is a useful tool, a webinar, a series of educational posts or a whitepaper. The extra effort can help you retain customers and reduce churn.
- Know what the competition is doing. What is there that separates them from your company? If you cannot find anything, you have no competitive advantage. You need to focus on what you do well and expand it to encompass benefits that the competition cannot provide.
- Let your customers know that you work hard to please them. You should not be obvious about this; try sending them a personal email on the weekend, for example, or mention that you have identified a way for them to save money.
- Stay in touch. An occasional email can do wonders to build relationships if you make it personal and sincere. Thank them for trusting you with their business, ask how they are doing and tell them that you just wanted to see whether there is anything else that you can do for them.
- Learn how to truly listen to customers. Your objective is to have happy, engaged customers. Surveys can sometimes provide you with valuable insight that you can leverage to provide better service to all customers. They can also help you identify customers that may be getting ready to abandon you for a competitor. Pay attention to conversations on the social sites or forums. Of course, you can also just call them.
- Provide unique content. A blog, resources section or educational material can help you engage your customers. Offer content that will help your customers solve their problems, and link content to your service or product to reinforce the concept that your company is the solution to their problems.
- Identify what you do not do well. If you do not know your weaknesses, you cannot fix them. Minimize identified weaknesses by leveraging your strengths.
- When customers try to cancel, remind them of the reasons that they chose you in the first place. A simple pop-up attached to the "Cancel" button or an automated email can sometimes help. Speaking of the "Cancel" button, make it a little bit difficult for the customer to find instead of displaying it prominently on every page.
- If you cannot avoid a cancellation, try to get the customer to tell you why they are leaving you. You may not be able to convince them to complete a survey, but even a drop-down list of possible reasons may prove helpful.
Using these tips can help you improve your churn rate, and in turn, you will also be improving your customer lifetime value. Minimizing churn helps increase customer satisfaction while boosting your profitability.