3 Ways to Reduce Your Churn Rate and Boost Customer Retention
Strategies for Lowering your Churn Rate and Keeping Customers Longer
CHURN RATE (noun) – the annual percentage rate at which customers stop subscribing to a service or employees leave a job.
A high churn rate can be a killer for any brand, and if that number is too high – your company may not be in business much longer.
No matter how you measure your churn rate, whether monthly, quarterly or yearly, knowing how many clients or customers aren’t coming back is incredibly important to the growth of your business – not to mention understanding the reason why they’re not coming back in the first place. And while it’s great if you’re getting traffic, the real challenge is to keep them coming back.
In the past decade, the way your consumer does business has changed, and successful brands can no longer rely on customer volume alone to make ends meet. It’s infinitely cheaper and easier to build upon existing customer relationships than going through the process of acquiring new ones.
Let’s look at 3 ways to lower your churn rate.
- Consumer Oriented Approach
The customer experience is now the only one that matters. That means everything from your online brand to the way you answer your office phone must be designed around customer retention. Put some thought into what you offer besides your product or services. Consider things like whether or not your mobile app runs smoothly, how your staff responds to questions and how quickly you respond to customer’s needs. By providing a unique, pleasurable, and even fun experience, your clients will be more inclined to not only be loyal, but also vocal in sharing their praises.
This goes well beyond returning emails or responding to a Facebook comment; every part of your brand should be designed to effectively communicate with your target audience. Your messaging should be streamlined and clear. Your social media presence should be a line of direct communication with your current clients.
Also, make sure you have a system in place to collect customer data so you can communicate with them in the future. This is vital to lowering your churn rate. When your company launches new products or services you can directly reach out to current consumers and keep them coming to you for their needs. Effective communication will always lead to customer retention.
- Know Your Value
What makes you better than the competition? Quality? Price? Location? You need to have definitive answers to that question and hammer it home to your customers. How do you feel about Amazon? They offer a large selection at very competitive prices. They deliver on this promise every day, and most people feel pretty good about using their services. What about Netflix? They are so good at knowing their value that they are now able to produce their own content instead of just streaming others. Netflix delivers on their promise of “Watch Anywhere. Cancel Anytime” so successfully that people are canceling their cable subscriptions instead.
If your company offers the best security cameras around, that message needs to be on your advertising, social media, products and anywhere you can think of—but most importantly it must be true. Define your values and stay true to what differentiates your brand from the rest.
The main thing to remember is that brands can no longer expect quality customers to walk through the door every day. Focus on cultivating relationships to keep the people who do walk through your door, coming back.
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