Business and Industry Perspective
Churn (or cancellation) rate refers to the percentage of customers who leave your product or service. For usage or subscription-based businesses, it is arguably THE most important metric to monitor. A high churn rate is a classic sign that the business you are running is no longer sustainable. The good news? Taking action to both identify your most valuable customers and improve user experience can quickly remedy the problem.
Here are seven strategies to reduce customer churn and, ultimately, increase revenue.
Just like your website may provide the first impression before a sale, your onboarding experience sets the tone for the quality of service you provide to customers. If your onboarding experience is negative, choppy or unprofessional, your customers will expect the same level of support throughout your partnership. In fact, new customers are most likely to churn in the early days of onboarding, so creating a smooth platform transition is vital to your relationship. An effective onboarding process will build your customer’s trust, demonstrate the value of the product or service, and set the foundation for the remainder of the partnership.
Pro Tip: Earn your customer’s affection in the early days and win them for a lifetime.
While user experience (UX) typically refers to how easy or intuitive a product or website is to use, good UX really comes down to meeting the needs of your customers. Our customer retention tip? Encourage new hires to interact with your product and service before getting your official training. Their fresh eyes will give you visibility into how new customers might approach your product or service. This will help you identify gaps, watch user patterns, and determine what may be less than intuitive.
Pro Tip: Talk to your support team and make sure these gaps directly influence your roadmap.
What kind of technology are you providing for your customers? In today’s competitive market, the answer to this question could make or break your churn rates. Add over-the-top value by offering services above and beyond basic connectivity and data connection. For example, self-service capabilities can empower your most valuable customers to take charge of their accounts and help you stand out in the market.
Pro Tip: Discover 4 tips for rolling out a new service offering.
Thanks to modern APIs, business intelligence is no longer exclusive to enterprise companies. Organizations of all sizes can access predictive analytics to detect early warning signs of at-risk customers. Recurring revenue and subscription-based businesses can avoid churn by tracking metrics like frequency of user engagement, customer satisfaction scores, and more.
Pro Tip: Look for a customer management tool that offers custom reporting to track the information that matters most to your business.
Adopting a modern, automated billing system can improve accuracy, build trust, and, ultimately, improve retention. Billing is personal for your customers. One small mistake can trigger a major chasm of trust between you and your customers. Whether your customers are facing an inaccurate charge or unpredictable billing rates, chances are that trust will not only get lost in the billing process but also in your product or service as a whole.
Pro Tip: You can’t afford to make billing mistakes. Read more about how better billing can drive your client retention strategy.
Mistakes happen, but the quality of your customer support can reverse, or exacerbate, these issues. Almost 70% of the identifiable reasons why customers left typical companies had nothing to do with the product. The prevailing reason for switching was poor quality of service. Make sure your support team is prepared and empowered to deliver quality care and views each trouble ticket as an opportunity to deliver world-class care.
Pro Tip: Choose a service provider that keep their development and customer support in-house to prevent this pitfall.
Businesses spend 5x more to acquire a new customer versus what they spend to retain an existing customer. To see how we can help you predict and prevent churn of your most valuable customers, request a demo or contact Rev.io today.
Take the necessary steps to grow your business at scale. Request a demo of Rev.io’s billing software today.