How to Prevent Customer Churn

There's nothing more satisfying than closing a deal with a customer. However, there's nothing more disappointing than losing a customer -- forever.

Naturally, you're going to lose some, here and there. Like with cars, some people prefer flashy, red convertibles, and others prefer modest SUVs. It's a matter of personal preference. One of your customers might have gotten a whiff of a competitor and decided that brand was more up their alley.

It has nothing to do with you or your performance, right?

Wrong.

Often times, customer churn is preventable. Getting a customer to make a purchase with you should be the hardest part. Once they're hooked, it should be second nature for them to return to your brand when they need an upgrade or new product.

So, if they're leaving your service and switching to a competitor, that means something happened that triggered their change. Whether or not it's something you, specifically, did, there are many ways you can prevent the thought of ever cheating on your brand with a competing brand from ever crossing their mind.

What Is Customer Churn?

Customer churn is the percentage of customers that ceased using and purchasing your organization's products or services during a specific time frame. Churn rate is calculated by dividing the number of customers you lost during a time frame, such as one quarter, by the number of customers with which you began the time period.

Of course, you want your churn rate to be as low as possible, as that means you're maximizing customer retention. It's near impossible to have a churn rate of 0%; losing customers is normal, but you never want to pay so little attention to your churn rate that you let it get too high.

Thus, to stay on top of your company's churn rate and prevent customer churn, follow these steps.

5 Steps to Prevent Customer Churn

1. Provide outstanding customer service and support.

A big reason why customers churn is due to a lack of quality customer service. According to an Oracle study, 89% of customers switched to doing business with a competitor due to a poor customer service experience with the original brand. Customers want to feel like they are heard by your organization, so prove to them that they do.

You can provide outstanding service and support by being proactive. Don't just wait until a customer reaches out with a complaint to halfheartedly communicate with them. If it comes to your knowledge that there is now an upgrade available for their purchased product, or if you find out that there's been a glitch discovered in the product they purchased, make a point to reach out to them individually.

They will appreciate the time you took to offer support -- especially when they didn't even know they needed it. If they feel like they matter to your company as more than just a means to a sale, it's likely they'll stick around.

2. Provide value beyond the purchase.

Besides providing outstanding service and support, there are other ways that you provide value to your existing customers and prevent them from churning. It's all about making them feel like your company has more to offer than a single product that they needed to fulfill a single need. Show your customers that your organization provides unparalleled value.

Some examples include sending daily or weekly newsletters, sharing with them relevant blog posts, creating a customer education program, or keeping them up-to-date on upcoming events and programs held by your company. Encourage them to sign up for your email newsletter, if you have one, and they'll get used to seeing your company's name in their inbox.

By sharing blog posts that are related to an experience they relayed to you or the product they purchased, they'll feel flattered that you remembered and thought of them. And, this valuable content will further improve their lives and remind them of why they chose your business in the first place.

3. Personalize customer experiences.

As said before, customers want to feel like they're special. Yes, realistically, they know you have hundreds, thousands, and even tens of thousands of other customers. But, in their hearts, a small part feels like they matter and are remembered. That's why customers love when they're recognized by name at their favorite restaurants, bars, and stores. Even if they don't get any special treatment as far as free products, it makes them feel like they're seen.

Similarly, you want to create that experience for your customers through your brand. Every single customer should feel that they're special to you because they are! Without their trust in you, you would have no business. Thus, personalize every customer experience.

Mass emails are easy, but it's easy to tell that they were sent en-masse. If you can't handwrite every email to customers, try grouping together customers by certain demographics or by the products they purchased so you can personalize their experiences more. That extra step it takes to personalize customer experiences can be the deciding factor for them to stay with your business.

4. Analyze churned customers.

A great way to understand what is driving some of your customers to churn is by actually asking them. Consider surveying some of your churned customers to get a sense of why they left you for another brand. Analyzing the data can help you come to some important conclusions about what changes your company needs to make in order to lower its churn rate.

After coming to terms with the changes you need to make, actually work to implement them. Whether it be a lack of communication, slow customer support, a faulty product, or another factor, it's important to consider how your organization can use the feedback for the better.

Set a goal to make the appropriate change and plan specific tactics that can help your team achieve the goal. Analyze the results of the change by comparing your new churn rate with your original one.

5. Focus your attention on your strongest customer relationships.

You can sometimes tell when a customer is on the verge of churning. They've stopped liking your social media posts, unsubscribed from your email newsletter, and sent a couple -- or 12 -- angry emails. Panicking, you might decide to throw all your resources in one bucket to try to salvage that customer relationship. What comes to mind is showering that customer with incentives to stay.

However, what's a better use of your time is to focus on your loyal customers. What can sneakily cause an increase in customer churn is loyal customers feeling like they suddenly don't matter in comparison to new customers. Since they're loyal to your brand and have been for some time, it's easy for companies to think, "I don't have to try hard to communicate with this individual. I know they're going to stick around." But, like in any relationship, if someone feels like they're being used or becoming "old news," they'll end things.

Don't let your best customers break up with you; never lose sight of the customers who have been there for you through it all. They're the ones who you should be focusing on; it's better for a new, recent customer to churn than a long-term one.

For more information, read about how to prevent buyer's remorse next.