Relevant customer data and communication approaches are key
There’s no denying that customer churn can slow the growth of a company over time. It’s an issue every company struggles with on a regular basis. However, with the proper tools, it is quite possible to keep churn rates to a minimum.
Business leaders are realizing that the communications efforts that hit home best with today’s savvy consumers are personalized, relevant, and designed and delivered in unique ways.
Churn rate is a term that gets thrown around a lot in relation to customer behavior. The short definition: the “number of customers who stop doing business with an organization over a specific time period.”
Research conducted by a leading data visualization company recently revealed that if a customer has made one purchase from a specific store, there is a 27 percent chance that he or she will make another purchase from that same store. Additionally, the results showed that with three purchases, a customer is twice as a likely (54 percent) to purchase from that same store again down the road.
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The key to keeping your company’s churn rate to a minimum lies in data and analytics. By mining and analyzing data, you can gain better insights into your customers’ needs, preferences and potential behaviors.
This valuable information can enable the development of strategy, and that strategy can enable effective communications in which customers will ultimately value and prioritize when making choices about which company to make a purchase from.
Business owners can leverage big data to understand customers’ sentiment and needs before issues arise that can lead to churn. Big data also can be used to understand the reasons for past churn by looking for patterns and abstracting the information to reasons they became churn issues.
Here are some ways to identify your company’s churn rate, and tips to keep it low:
Understand that churn can be an indication of a number of factors, including customer dissatisfaction, high prices, poor marketing, or just a natural part of the customer life cycle.Ask outgoing customers to tell you why they cancelled or want to switch to a competitor. Then, use this data to better understand your current customers, and decide if you need to make any necessary adjustments.Spend some time thinking what makes a solid, long-term customer. Understand the values they credit to your service (prices, free shipping, product array). Try ad retargeting. This can be an effective approach in winning back former customers by reminding them about your quality services and/or products.Engage customers through regular email marketing and social media. This is a good way to keep them up-to-date with your latest products, as well as build brand loyalty.With social media today, consumers have a very powerful platform to talk about your company’s products and/or services.It can be a great vehicle to spread your company’s messages and share content. It’s also a way to connect personally to people, and immediately turn fans of your brand into loyal advocates.
Transforming the information you have about your customers into knowledge can grow your business and create even more loyal customers. Big data can help ensure that, through every customer interaction, a company is doing its best to be as personal and relevant as possible at the point of immediate need.