3 killer tactics to reduce business churn

Is your business struggling as a result of a high churn rate? You're not alone – churn affects many Australian businesses, particularly those in the administration and hospitality industries, ABS data shows.

Here are some winning strategies to reduce churn and ensure your customers keep coming back.

Over 30 per cent of marketing managers don't have a process in place to determine why a customer switched to a competitor.

1. Find out why your customers aren't happy

Over 30 per cent of marketing managers and over 20 per cent of sales managers don't have a process in place to determine why a customer switched to a competitor and to which one, Kissmetrics data reveals. You won't know why your customers are leaving or why they're unhappy if you don't ask them, so it's important to find out.

Customer satisfaction surveys can be set up quickly and easily and sent out to your customers at regular intervals to determine their level of engagement and satisfaction with your business.

3 killer tactics to reduce business churn
Sending out customer satisfaction surveys will give you information you can use to determine why customers may be leaving – and help you do something about it.

Send out surveys when you first onboard a customer, then at periodic intervals throughout the business relationship. This will provide data that can pinpoint key moments when customers are losing interest, and give you insight into the reasons why. Kissmetrics recommends keeping your surveys to 10 questions or less to increase the chances of customers filling them out.

2. Develop an adaptable approach to customer service 

If your surveys reveal it's poor customer service causing your customers to flock to competitors, you'll need to improve yours. This is not simply about boosting the quality, but doing it in a smart and targeted way. 

Dedicate more energy to customers who spend more with your business.

Research by McKinsey into churn found that businesses should consider the 'churn profitability' of customers. In other words, try to dedicate more energy to customers who spend more with your business. If a customer that spends big decides to do business with a competitor, this will have a much greater impact on your churn rate than a customer that spends half as much.

This isn't to say you shouldn't focus on providing quality customer service to all your customers. However, setting up a dedicated team who can provide better service to high-paying clients could help reduce the impact of churn on your business.

3. Get a customer loyalty program going

Customer loyalty programs help reduce churn and improve customer retention because they reward your existing customers for doing business with you. After all, 83 per cent of people will keep doing business with you if you have a customer loyalty program, according to Selfstartr. Harnessing that power is essential to keeping your business afloat. 

When it comes to putting a customer loyalty program in place, talk to 212ºF about how we can create one perfectly tailored to your customer base.