What is Customer Churn?
Customer churn occurs when customers or subscribers stop doing business with you. Other terms used for this are customer attrition, opting-out, cancelations, loss of customer or simply churners. It is much less expensive to retain existing customers than it is to acquire new customers. This is an important tool so that you can take action to retain them.
Why Do Customers Leave?
Dissatisfied customers will rarely give you any warning; rather, they will simply stop purchasing your product or service. Even when they do voice their dissatisfaction, it is usually at the point where trust has been compromised and long-term consumer retention is unlikely. True consumer retention and customer loyalty is achieved only by early detection of customer's intention to churn and prompt action. With Dunn Solutions' Customer Churn Reduction Consulting you will know in advance if a customer is going to churn thus giving you opportunities to retain the customer.
Retention and the Customer Journey
Organizations dedicate a large portion of their marketing budget to acquire customers. Even before a customer is acquired, you must gain brand and product awareness and customer consideration. This requires effort throughout the sales funnel, using marketing and sales resources. Once a customer is acquired they should be held on to dearly (at least the ones with high lifetime value)!
Knowing which customers have a high propensity to churn is critical to targeted retention efforts. Dunn Solutions' Customer Churn Reduction Models will identify who is likely to churn by providing a churn risk score and also help you focus your efforts by predicting customer life time value.
Should All Churning Customers be Targeted?
While it is tempting to target all potential churning customers, it is not cost effective or profitable. The point is to make money and you accomplish this by retaining the appropriate customers. Who are these customers? Only high lifetime value at risk customers should be targeted.
How Can You Detect the Early Signs of Future Attrition?
Which customers have a propensity to churn? The answer lies in your data, but it is not something you can do with a spreadsheet! Using machine learning, Dunn Solutions' Customer Churn Reduction Consulting uses your historical data to find the patterns and predict who is most likely to churn.
Retaining Loyal Customers and Advocate Customers
Loyal customers and customers who advocate for your services or products are very valuable customers. Not only do these customers buy your products or services religiously, they also act as part of your sales team! Losing these customers to churn would require acquiring multiple fold number of new customers. This is an expensive proposition. We will help you identify these potential churners so that you can proactively take action to keep these customers happy and satisfied.
Customer Churn Reduction Metrics
Dunn Solutions' Customer Churn Reduction Consulting provides you with a list of customers most likely to churn as well as the following metrics:
- Life-time Value of Customer
- Churn Rate
- Risk Score
- Opportunity Loss