Customer churn is a concern among most business owners. In short, this is nothing more than the percentage of customers that stop using your service during a specified period of time.
While the definition of customer churn, or churn rate, is easy to understand, it’s much more difficult to pinpoint why this has become a problem for your business.
If you’re not yet in the habit of calculating customer churn, now’s the time to change your ways. It’s critical to keep a close watch on this number, as it says a lot about the current health of your business and whether or not you’re trending in the right or wrong direction.
Some level of customer churn is expected. You can’t keep every customer on board forever. However, this doesn’t mean you should ignore the top causes of churn. Here are a few things to think about:
If a customer feels like you’re overcharging or not providing enough value for the money, they’ll begin to look elsewhere. Just the same, if your competitors offer a lower price for the same or better product/service, you may run into an issue with a high churn rate.
Establish a fair price, provide great value, and educate your customers as to why your product/service is head and shoulders above the competition.
2. Customer Service
You can have the best product/service, but if you fall short in regards to customer service your churn rate will remain high.
Your customers want to know that you’re taking care of them. They want to know that you’ll make things right if something goes wrong.
From your customer service reps to your salespeople to your account managers, make sure everyone understands the importance of a good customer service experience.
3. Market Fit
As a company owner, you know how important it is to constantly bring new customers into the fold. Just the same, salespeople often do whatever it takes to close a deal, as they have a quota to hit.
Here’s the problem: this often leads to selling to customers who aren’t a good fit for your product/service. It won’t take long for your customer to discover the bad fit, which typically leads them to search for a better solution.
Even if you’re happy with your current level of customer churn, there’s always room for improvement. One or more of the points above may require your immediate attention. If you are still lost as to what is customer churn, contact us. We are always happy to help and guide you in the right direction.
For more insights on marketing strategy that actually works for small business connect with Jay Bean, Founder of FreshLime and small business marketing expert, on LinkedIn and Twitter. And last of all, if any of these tips have helped you or if you have anything to add please comment below. We’d love to hear from you!