Customer churn is the process of losing customers. Losses could be due to subscribers leaving for another business or simply choosing not to renew their subscriptions.
Identifying these types of behavior patterns helps marketers uncover which individuals are at risk of leaving and what can be done to keep them around.
This information can also help your company determine which customers are less important and might not be worth making changes for.
By implementing the churn management process, companies can ensure the best customer base possible to meet their business goals.
What Are Some Ways to Predict Customer Churn?
There are multiple ways in which to do this. The first is what’s referred to as historic churn analysis.
This process involves looking at historical data about customers that have left in the past and then comparing them to similar clients who remained involved with your business for a more extended time. Find patterns that indicate why some customers will stay with a company while others leave.
The second churn management process is much less time-intensive. Survey your customers and ask them what keeps them coming back for more. Inquire whether they have tried other companies in the past, and if so, how those businesses differed from yours.
This type of questioning can help your business gather valuable information about which features are the most popular, how individuals feel about the prices you charge for your goods and services, etc.
What Steps Does the Process Involve?
- Determine which customers are at risk of churning or leaving your business soon. Specific indicators can help you identify high-priority customers. They include time spent outside the average, account inactivity, usage patterns, and billing issues.
- Talk with these individuals to see why they might be leaving or make a change soon. You can use a survey or email these users to learn more about their thoughts on your business, the pricing they find reasonable, and what they could do to keep them from leaving.
- Make changes to improve the experience of each subscriber. Ensure any customer is happy with your product/service offering and you have competitive pricing options available.
- Track results and repeat this process for a new cohort of customers to monitor the success of your efforts over time.
- Get answers to what kind of customers are at risk, why they are leaving or considering it, and how you can fix the issue before losing them for good.
- Continue this process regularly to ensure that your business does not lose any additional customers.
Why Is It Important to Monitor Customer Churn?
If you do not monitor customer churn, business growth could stagnate, and it might be harder to establish new relationships with clients. Tracking who is leaving the company helps ensure that marketers focus on those accounts and continue to move forward.
Customer churn analysis can also help determine which customers are more valuable to keep since it’s not always necessary to keep everyone involved.
Customer retention takes a lot of effort, and monitoring customer churn is not always easy. But if your business wants to meet its goals, it’s necessary to make sure customers stay happy and involved with your company operations.
Using the correct methodologies can help you determine which particular customers are more likely to leave and allow your company to take the right actions early on.