You may have come across situations where your customers no longer want to work with you. A root problem might be that they never gained business value from your product. Why is that? Did they implement it poorly? A lot of questions come right knocking at you. Let us see why retention is important. How to retain customers who are canceling their subscriptions.
Why is customer retention important?
70% of companies say it’s cheaper to retain a customer than acquire a new one. The old rule of thumb says it costs 5 times more to acquire a new customer than it did to retain one.
Your customer retention rate depends on a lot of factors and can speak a lot about the current health of your business. If your customer health score is not good enough, there’s a high risk of your customer churn out. Customers who are satisfied with your business are easier to retain.
Additional Resources- Gross Retention Vs Net Retention
Engaged consumers buy 90% more frequently, spend 60% more per transaction and are five times more likely to indicate it is the only brand they would purchase in the future.
How to Build a Funnel to Retain Customers
Doing the right thing at the right time can help retain customers. Let’s look at some of the ways you can retain customers who are on verge of canceling:
Analyze what you know.
Let’s start with what you know. Ask yourself these questions. Do you know the reason why your customer is canceling? Is this a surprise for you or do you already know the issue? Can the issue be solved?
You know the issue and the reason why they are churning out, look deeper—why weren’t you able to get in front of the issue earlier, what attempts to solve have you already made (because there is no use trying those again), and consider what you haven’t already tried.
Suggested Reading: How to conduct Churn Analysis?
Gain an Understanding of What Customers Want
Collect the voice of the customers at risk. You can also do this for loyal customers, high-value customers, and also for former customers.
This will help you be aware of many important things including the reason your customer bought your product, why they stuck around, and what made them cancel. The following methods and campaigns can be used to learn more about your customers:
- Social listening
- Net Promoter Scores
- Support tickets
Build Workflows Around Your Customer Churn Red Flags
Once your campaigns are set up, you’ll then want to set up a workflow to determine which triggers to use based on the churn risk factors you’ve identified.
For SaaS providers, you might look for customers that haven’t logged into their account for X number of days, didn’t complete the onboarding, or have stopped using your product.
Also, Do your clients avoid answering your calls and your emails? Do they cancel their meetings with you or your reps? This might be a sign their emotional attachment is decreasing on par with their satisfaction.
Talk to the customers who are leaving
Churn is inevitable, it will happen. But you need to analyze the real reason for the churn. This helps you build up solutions against it. Use your churned customers’ feedback to avoid mistakes if any. Also if a customer is not satisfied with your product.
If a customer decides he doesn’t want to do business with you anymore, don’t let that customer walk out the door before you know why. The feedback here is very valuable for you. There can be several reasons why the customer is leaving you. Learn about them and this will help you improve your product.
Move on when the time comes.
If you know you can’t solve it, or if the customer isn’t worth saving, you should probably move on. Ask yourself this question, Is this customer worth all the effort you are taking to save them? It is obvious that you cannot solve every cancellation reason?
Maybe sometimes it’s not enough to just have a great product that solves a real problem. Or your customers have low adoption on their side and cannot use your product to the fullest.
How CustomerSuccessBox Helps
Customer Success has become a buzzword over the years. And if you want to retain your customers and ensure they are successful, customer success software is what you need.
CustomerSuccessBox helps you quickly determine which customers are maximizing your product’s potential, and which customers are struggling.
Don’t wait for customers to raise a support ticket anymore. CustomerSuccessBox monitors all accounts and users’ every move without missing a beat. It alerts you when it finds anything suggesting a future churn risk.
You can then dive right into where you’re needed, while you still have time to save the account. Smart data-driven AI-powered Risk Alerts point you right where your attention is needed the most.