If you’re looking to reduce churn risk in your business, then look no further! These tips will help you keep more customers and clients happy and engaged. By following these simple tips, you can decrease the chances of losing valuable customers or clients.
How to Identify and Avoid Churn Risk
Churning is not a sign that a customer of SaaS is unhappy with your product. Lincoln Murphy says that lost customers are a “threat to your company, your revenue [and] your ability grow.” It doesn’t matter if your company has a rate of customer churn in the 5-7% range, but it is crucial to use implicit data to assess risk among your customers.
If you don’t use behavioral analysis to identify the segments of clients that are most at risk of churn and reach out accordingly, you might be surprised to see a sudden, potentially devastating loss in revenue when customers move to a competitor. There are many ways to identify customer churn risk early on.
1. User Engagement
Customers who aren’t invested with your product are the biggest risk of churn. Why should they continue to pay for your subscription service if they don’t use it on a regular basis? It is important to understand that customer behavior can only be accurately analyzed if there is a baseline measurement of optimal engagement.
What’s considered “normal” for your product may change significantly over the customer lifecycle. As such you should be able to gauge how customers actually use your SaaS.
Murphy pointed out that you can miss signs of disengagement without a baseline measurement and lose customers when you really didn’t have to. WebEngage can combine customer insights and feedback for proactive monitoring.
2. Sign the Right Customers
The trial phase can be used to ensure that your sales team is focusing on the right prospects. Michael Gentle suggests that you score your trial users against a set defined churn risk criteria. This could include information about the organization and insight on needs.
You can build a loyal customer base by focusing your fight against churn “upstream”. Marketing automation.
3. Engage in meaningful relationships
Your best weapon in retaining high-risk customers is to give them the tools they need to succeed. Customers who aren’t able use your product successfully will stop engaging with your company. This segment of high-risk customers should be treated with respect and your customer service representatives should focus on proactive suggestions for improved usage.
Gentle points out that SaaS requires customers to realize value every month or quarter before they renew. Your account managers and support representatives have the responsibility of promoting value realization in your customer base. Salesforce CRM and the AppXchange apps can help you scale your renewals and engagement.
4. Monitor trigger events
Many subscription businesses find that trigger events within their organization can be a key contributor in churn. They are more difficult and costly to monitor than client engagement and happiness. You should have a plan in case your point of contact leaves an organization or your account administrators change, which could signal organizational restructuring.
Murphy suggests that you develop a strategy to retain your best customers and possibly let go of others to monitor trigger events.
There are many reasons why churn can occur that are not within the control of your company’s customer service and retention specialists. Customers can cancel their subscriptions to a product they love because of a lack of organizational readiness or misalignment between value and cost. You can prevent churn from happening by being proactive and not ignoring warning signs.
By following these tips, you can help reduce churn risk in your business. By keeping your customers and clients happy and engaged, you’ll be less likely to lose them to a competitor.