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Stop The Customer Churn!

Posted on 1.03.2017

You're going to lose customers - it's just a part of doing business.

What you don't want to do, however, is let those customers leave without knowing why they are doing so and without taking the necessary steps to keep similar profiles (people/users) from leaving too.

The concept of churn is very real but often the "churn rate" that is reported can be somewhat misleading (if not outright deceptive) and is not always representative of what's really going on in terms of the success of your business or that of your enterprise.

The reason of course is because there are different types and reasons for churn - sometimes it's voluntary and sometimes involuntary (and knowing the difference can make a meaningful impact).

The trick is to know what's occurring (voluntary or involuntary churn), when it is occurring and taking the necessary steps to correct those issues the future - essentially having a process in place to reduce and limit churn.

Involuntary churn can happen for a number of reason - from death to bankruptcy. There's little that businesses can do to prevent this type of churn and in many ways, it's just part of doing business.


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Voluntary churn, on the other hand, results from those that have not received value from a service - and it is this group that Web businesses should concentrate at least a portion of their attention.

The objective when consumers decide to abandon a service or product is to understand why they are leaving (you're likely not going to be able to convince them to stay anyway). Filling out a long and elaborate questionnaire is simply not something they will want to do so avoid asking open-ended questions (unless you like filtering out a lot of gibberish) and focus on designing forms that identify the reason for the cancellation. To do this you'll really need to understand at least some the reasons what barriers exist and arrange them in an effective order (with the most common at the top or at least visible).

How does your enterprise measure churn and what steps are you taking to reduce and limit its impact on revenue? 

 

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