{"id":20304,"date":"2022-12-19T12:05:58","date_gmt":"2022-12-19T04:05:58","guid":{"rendered":"https:\/\/www.cldy.com\/sg\/?p=20304"},"modified":"2023-02-28T20:42:18","modified_gmt":"2023-02-28T12:42:18","slug":"most-effective-ways-to-minimise-churn-rate","status":"publish","type":"post","link":"https:\/\/www.cldy.com\/sg\/blog\/business-marketing\/most-effective-ways-to-minimise-churn-rate\/","title":{"rendered":"The 7 Most Effective Ways to Minimise Churn Rate"},"content":{"rendered":"

New customer acquisition is often\u2014if not always\u2014a priority for businesses. While it\u2019s understandable to want to introduce your brand to a new audience, you also need to develop strategies to <\/span>minimise churn rates.<\/span><\/p>\n

So, <\/span>what is churn rate? <\/span>Churn rate, or customer attrition rate, measures the percentage of customers who stop doing business with you. For example, if you are running a subscription-based business, you calculate your churn rates based on how many people discontinue their subscriptions within a given time period.\u00a0<\/span><\/p>\n

Now, <\/span>average churn rates <\/span>vary per industry. But there\u2019s no doubt that high churn numbers put a wrench in your business\u2019s finances. So if you\u2019re ready to explore ways to keep your churn rates low <\/span>and <\/span><\/i>growth rates high, keep reading.<\/span><\/p>\n

The <\/b>Churn Rate Formula<\/b>: How to Calculate Customer Churn\u00a0<\/b><\/h4>\n

Churn rates can be calculated by <\/span>dividing the number of churned customers <\/b>by your <\/span>total number of customers for that period, <\/b>and multiplying the result by a hundred.<\/span> . You can calculate churn rates by month, day, quarter or annually. Typically, businesses like to analyse their churn rates by month.<\/span><\/p>\n

Churn rate formula: Churned customers (for a specific period) \/ total customers x 100<\/b><\/p>\n

For example, your subscription-based service manages to gain up to 1000 customers for the month of November. At the end of the month, you saw 100 users unsubscribe from your service. So your churn rate for the month of November is 10%.<\/span><\/p>\n

7 Reasons for Customer Churn and<\/b> How to Reduce Churn Rates<\/b><\/h4>\n

1. Bad service<\/b><\/p>\n

To no surprise, the biggest reason customers leave is that they found better service elsewhere. Now, you could think that losing one customer would have little to zero impact on your business.<\/span><\/p>\n

But think about this, the average dissatisfied customer is likely to tell twice as many people about their negative experience than happy customers do about their own experience. This statistic shows <\/span>how bad customer service<\/span><\/a> can hurt your business.\u00a0<\/span><\/p>\n

The Fix: Personalise, personalise, personalise\u00a0<\/b><\/p>\n

When you interact with your customers, treat them with respect and patience. Sure, some customers are bound to get agitated when things don\u2019t go their way, but keep your emotions in check and try to empathise with their situation. It\u2019s also important that you train your staff on customer service etiquette as well.\u00a0<\/span><\/p>\n

Personalisation also goes a long way when it comes to customer service. So, make sure you provide <\/span>personalised customer service<\/span><\/a> through your different channels. It can be as simple as remembering their names and asking for feedback. It also helps to use a Customer Relationship Management (CRM) platform, to record and track a customer\u2019s information.<\/span><\/p>\n

2. Customers don\u2019t know to use your product<\/strong><\/p>\n

You\u2019ve made a great product, marketed it to your audience, and even successfully started selling it\u2014 so what\u2019s next? Well, it\u2019s time to get people to actually <\/span>use <\/span><\/i>your product and achieve success.\u00a0<\/span><\/p>\n

If customers find that your product or service isn\u2019t achieving what they initially signed up for, then expect a rise in churn rates. Your products and services need to fulfil pain points and make the consumer\u2019s life easier. You need to give users value for their money or risk losing them.<\/span><\/p>\n

The Fix: Improve your customer onboarding process<\/b><\/p>\n

Onboarding is more than just teaching customers how to use your product or service and calling it a day. It marks the first of many interactions between your business and a new customer. Ace your onboarding experience, and it can greatly <\/span>minimise churn rates.<\/span><\/p>\n

Don\u2019t believe us? Let the numbers speak for themselves. It\u2019s estimated that <\/span>74% of potential customers<\/span><\/a> switch to other solutions when they find the onboarding process complicated. It\u2019s even more crucial to optimise onboarding if you run a freemium model. 63% of customers identify onboarding as a key factor when deciding whether or not to subscribe to a product or service.<\/span><\/p>\n

To improve your onboarding process, consider the following practices:<\/span><\/p>\n