If you work in marketing, you are probably tracking customer churn. It’s one of the most important metrics you need to know about. But are you tracking it for the right reason?
Put simply, customer churn shows how often your customers stop buying your product or service. But at first glance, what seems like a revenue issue can often be indicative of a lot more than that.
If a customer stops paying for your product or offering, you need to examine why. Is it because your pricing is wrong? Is your service to existing customers up to scratch? Has your product or service become obsolete? Is your product or service easy and intuitive to use?
Customer churn can even be an indicator that your competitors are doing something more effectively than you. Have they launched an updated product or service? Have they undercut you on price? Or maybe they’ve started a marketing campaign to persuade your customers to jump ship.
These are just some of the questions you should be asking if you work in marketing and are tracking churn. It can highlight the areas you’re falling down in far more rapidly than human assessment.
Spot the patterns as they emerge
When you have the correct data to hand, you can see patterns as they start to emerge. Anyone can spot a pattern after it has taken hold – but the key to successful marketing is spotting trends before they become trends.
For example, the team at Brita analysed its marketing data and found a whole new target market: college students. Before that, Brita’s primary persona was the health-conscious consumer.
But Eric Reynolds, Chief Marketing Officer at parent company Clorox, said that the company uses machine learning to scour the data automatically for findings that humans wouldn’t even think to look for. He said that this approach helps, “Clorox get to those final two-to-four percentage points of growth that always seem to slip through our fingers.”
That strategy has led to Brita hiring basketball star Steph Curry – one of the most popular global sports stars in the world – to spearhead its marketing efforts towards the college demographic.
Eliminate churn before it escalates
There is a certain type of customer who your product or service just doesn’t suit. We’ve all been there – you buy a pair of trousers that look great in a store but aren’t so flattering when you wear them at home. As a marketer, there isn’t much you can do about these customers.
But sometimes people who are perfectly happy with your product stop paying for it. These are the ones you need to convince to stay. So how can you act like Brita to spot the patterns?
There are two things that marketers can monitor to help reduce churn. One is to keep an eye on your onboarding process. Granted, not all marketers will have or need an onboarding process. If you’re working with simple retail, your onboarding process is minimal.
Your customer buys your product and puts it on or uses it. Onboarding process complete.
But if you are selling a service or something that needs installing or anything that requires the customer to complete an action, the onboarding process is worth monitoring. You should be tracking whether people are visiting your help pages on your website. You can analyse social media to see if anyone is venting frustrations online about your process.
A problem in the onboarding process may be omnichannel – it may be a case that it needs to be fixed in conjunction with any one of product, engineering, development, sales, marketing or customer care.
Be prepared to put yourself in the customer’s shoes to redesign their experience.
Another related problem you can monitor is your relationship development. A survey in 2015 showed that 18 percent of all customer churn is due to the poor relationship the buyer feels they have with their vendor.
You can track this by keeping a record of how many times the customer interacts with customer service as well as their usage rate (if it’s IT-related). Instead of constantly trying to upsell, you should react quickly to any problems they might have as well as keeping them updated on any new developments.
Here at Statwolf – we can integrate data sources from all around your business so that you can have a compelling view of your performance across a range of channels. You can input data from about the onboarding process as well as the customer relationship data and combine this with data from social or anywhere else that has valuable information about your customers and potential customers.
We can create a bespoke system for you that will break down your information silos and present the data to you in a way that lets you make the most informed decisions possible.
At the end of the day, customer churn can tell you a lot about your business. It’s not just a sales problem; it’s a marketing one too. And it’s worth fixing. After all, it’s far easier to keep a customer than it is to find a new one.
Do you see the patterns in your data?
If you want to see how customers are interacting with your brand and bring all of your data together in a way that lets you see the overall picture, then you need Statwolf.
Get in touch today to see how we can help you increase the ROI of your marketing efforts with a marketing dashboard. We can also create a personalised system whereby we design a solution that fits your exact needs. Feel free to check out our solutions for marketers too.