Curbing Customer Churn: 4 Key Strategies
Customer churn is part of the business for even the most successful companies. New customers come, and some customers go. The question isn’t how to stop customer churn. It’s how to reduce it. What are some of the ways you can keep churn to a minimum? Here are four steps to get you started.
Identify customers at risk.
The first step is to figure out who you are most at risk of losing. Identify your most “inactive” customers. Who hasn’t purchased from you in a long time? Look for commonalities among them. For instance, if most are concentrated in a specific geographic area, ask yourself why. Are the demographics in that location changing? Is a new competitor moving in?
Assess your communication frequency.
Sometimes, customers churn simply because you aren’t communicating with them often enough. Don’t bombard them, of course, but don’t let customers slip through the cracks due to infrequent outreach.
Want to know why they are leaving? Ask!
Once you have identified your most inactive customers, create a plan to re-engage them. As part of this plan, send surveys to gain insights into why they are disengaging in the first place. Offer incentives to participate. If customers don’t respond to your surveys by email, follow up with direct mail. Print communications don’t get caught in spam filters and are more likely to be opened and read.
Recognize and engage your top customers.
One of the best ways to reduce customer churn is to keep active customers happy. Pay attention to them. Offer insider deals, and tell them, “Thank you.” Everyone likes to feel noticed and appreciated. Make your best customers feel valued by offering them something special.
Customer churn is a part of business, but high customer churn doesn’t have to be. So engage both groups—lapsed and engaged customers—each in their unique way. Sit down and create the right channel mix, with the right messaging and offers, to address the specific needs of each group. Then, watch your churn rate drop.
