Tackling Involuntary Customer Churn: Why It Is Important

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The customers are arguably the most important part of a business. When customers like and love your products and services, they become more than just buyers; they become brand advocates who champion your company and influence other potential buyers to do the same.

However, no matter how many loyal customers your business might have, there are still those whom you will lose at some point. Customer churn, whether voluntary or involuntary, may be a largely unwanted metric, but it can also be helpful as it may help you identify problematic aspects within your operations. Involuntary churn can be especially informative since it can be symptomatic of a problem within your customer journey that is not easily seen.

Expiring Memberships and Failed Payments

Customers these days are, for the lack of a better word, spoiled. They want convenience from start to finish, even when dealing with the smallest bit of information. Consider subscription-based companies like video streaming services with monthly fees or even credit card with annual renewals. Customers often forget when their subscriptions would end. They consequently forget to pay for a renewal and you, as a company, will either lose the customer completely or go through a new process to re-acquire this customer. Your customers may also want to continue their subscriptions or memberships, but sometimes encounter difficulties like failed payment transactions.

These issues can be easily addressed by using a smart subscription billing software, which ensures that customers are billed for the correct amount at the right time, resulting in a smoother, hassle-free renewal process. Aside from this, it also automatically deals with failed payment transactions, which, according to studies, is one of the most significant contributors to customer attrition.

Often, keeping your customers in the loop is only a matter of sending out reminders, notifications, and even promotions and special offers through your customer’s preferred medium, like SMS or email. Keeping in touch with your customers not only serves as a reminder to them that you, in fact, still exist but also that your company cares about them.

You’re Signing up the Wrong Customers

Involuntary churn can also come from people who do sign up but seldom or don’t end up actually using your products or services. Think about gym memberships or even mobile phone apps, where people only use it once or twice and then fall out due to various reasons—they forgot about it, they can’t find the time, or perhaps they just don’t want to use it anymore.

It is possible that these sign-ups are from the “wrong” customers, those who are not as committed to your product or had a poor onboarding experience. Addressing this source of involuntary churn may be as simple as convincing these “laggards” and potential customers why your product or service is worth their time. In other cases, you may have to tweak your marketing strategies completely in order to reach the customers you truly want.

Information is your weapon to address most business issues, including customer churn. Surveys are one of the easiest, cheapest ways to find out your customers’ pain points. You can also use analytics to figure out patterns in customer behavior, so you can customize retention programs depending on your customers’ habits.

Customer churn is an unavoidable part of doing business. However, if you’re able to figure out and immediately address problem spots for your customers, not only will you be able to minimize churn, you can even eventually gain back those defecting customers and convert them into loyal ones.

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Nick Barnett

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