We’ve said it before, and we’ll say it again “investing in new customers is far more expensive than retaining existing ones” (Invesp). However, whilst it is a less expensive exercise keeping existing customers, it’s not always that easy. Organisations deal with an array of factors that influence their ability to reduce “Customer Attrition” otherwise known as “Customer Churn – the loss of customers by a business”
Customer Experience programs are an organisation’s bread and butter when it comes to decreasing customer churn, however, like most things in business, it requires continuous effort and innovation to succeed. Let’s talk about “HOW” you can work to sustainably reduce customer churn in your business.
YOU MIGHT THINK YOU’RE HEARING, BUT ARE YOU TRULY LISTENING?
Hearing your customers and listening to them are two different things.
It’s easy enough to say that you collect digital feedback or set up a listening post on social media but as we discussed last week, it’s another process to actually gather feedback, internalise it, and utilise it for innovative change. What this also means is that organisations must be truly listening to both solicited and unsolicited feedback, as well as both structured and unstructured data.
From the customer’s perspective, they will choose to provide feedback to a company because they want to be heard or they want to make a difference with a particular brand, especially If they have had a negative experience along their journey which has caused them to seek out competitors. Alternatively, they may want to reward the company with positive feedback regarding their experience. Ultimately, there is an “Expectation” that when a customer submits feedback that the company will be listening.
In some cases, companies do listen and actively improve but often, we find that feedback disappears into a black hole, never to be seen by the right people, never followed up on and never reported.
What Is The Solution?
The Team at HOED Research have the expertise to manage your digital feedback and provide professional reporting on any pressing issues, complaints or compliments, which can be further utilised to improve your business processes, customer journey and offerings.
Ultimately, our expert advice would be to create a quality listening program that caters to the collection and interpretation of data, which can be communicated organisation wide for improvement purposes. Such a program can help to lower and even prevent customer churn.
The purpose of creating and utilising listening programs to reduce Customer Attrition is only achieved through true absorption and understanding of feedback collected. It’s a level of understanding that can be successfully crafted into actions plans that cater to all areas of a customer’s journey (e.g., employee training, improving customer journey touchpoints, digitisation to improve service offerings etc.)
WHY DO CUSTOMERS LEAVE?
There are many reasons why a customer may leave brands and it’s not always as straightforward as you may think. Some reasons are completely beyond an organisation’s control – E.g., a customer simply stops needing a particular product or service OR can no longer afford your products or services (very current factor). What this simply means is that Customer Churn in some cases is an unavoidable frustration that all businesses must deal with.
Businesses should be tailoring their customer AND employee experience programs to focus on what they can control. For Example, competitive advantage, fraud, poor customer service, lack of communication and responsiveness are all Customer Churn catalysts that can be controlled and improved on with the right programs in place.
Experiencing uncontrollable churn and churn in general can be extremely frustrating but why not try to utilise this situation to your advantage, by asking them for feedback about why they left your brand in the first place? This is called win/loss research and is one of the best ways to gather intel on preventable churn. It places focus on understanding the why behind both controllable and uncontrollable churn and can also be a great source of information on the competition, as customers more often than not will gladly share with you the reason why they went to another brand instead.
DON’T WAIT UNTIL IT’S TOO LATE.
Talking to customers who have already left your brand is all well and good, but let’s consider saving at-risk individuals before they do leave, and it becomes too late.
Listening and understanding whether your current customers are happy is paramount in determining what you need to do if they’re not. However, this is also an area where you must tread carefully to avoid making the issue worse.
Alternatively, as aforementioned, we can learn a lot from customers that have left and it’s simply understanding why these individuals leave that can help you to retain future business. Ultimately, listening from both existing and attired customers allows organisations to work upstream and do a better job of retaining at-risk business.
REDUCE CHURN THROUGH CONTINUOUS CHANGE
In an environment of such uncertainty, having a strong and loyal customer base is a real asset. So, let’s summarise how businesses can better retain customers and reduce churn:
- Listening to current feedback.
- Soliciting opinions and intelligence from past customers.
- Leveraging employee feedback, and
- Reporting on all feedback to create a holistic picture of strengths and weaknesses.
Sharing this data throughout the entire organisation is pivotal for there to be a comprehensive and common understanding by all team members. Businesses can only reduce customer churn if they ‘take action’ based on real feedback. Remember, hearing and listening are two different things, and customers would not bother submitting feedback if they did not expect to be listened to. Is this something your own organisation is guilty of?
In conclusion, setting up feedback mechanisms and managing the data may appear more complex than it really is. However, with the right partner and a long-term mindset, including key milestones, a lot can be achieved and gained in a relatively short timeframe. And its all about the ‘bottom line’ as the ultimate beneficiary.
If you’re lost with where to start, we are here to help! The Team at HOED Research have the expertise to manage your digital feedback and provide professional reporting on any pressing issues, complaints or compliments, which can be further utilised to improve your business processes, customer journey and offerings. Ultimately, working to reduce Customer Churn!