5 Ways to Reduce Customer Churn

June 16, 2022

5 Ways to Reduce Customer Churn

First: What is Customer Churn?
Customer churn is the percentage of customers that stopped using your company's product or service during a certain time frame. This can be measured by dividing the number of customers you lost during a certain time period by the number of customers you had at the beginning of that time period.

It is sometimes easy to assume that once the customer purchases your product they will be able to fluently use your software perfectly and without any issues. Unfortunately, in reality, this almost never happens. Getting the customer to buy and actually use the software are two very different things. For this reason, on-boarding is a critical part of any successful startup.

Churn is the number one cause of a failing software company. Your sales and marketing team can spend thousands of dollars on generating new customers, but if you cannot manage the churn rate, regardless of their success, you will never be able to grow.

Let's chat about how we can avoid the customer success pitfalls and reduce your churn.

When it comes to customer success, there are 5 things to watch for that will help you avoid the pitfalls of customer churn.

1) Understand the customer's success plan

There are two parts to this; The first step is to really understand what the customer wants to achieve by using your software. Here are a few questions that can get you started in building a plan:

  1. What are their goals?
  2. How will they measure success?
  3. What processes do they need to put in place in order to best take advantage of your software?

By understanding the answers to these questions, you can tailor the on-boarding process to each individual customer and ensure that they are getting the most out of your product.

Typically with packaged software, it is challenging to build out a full customer success as new people sign up. That's why most box solutions build a customer generic success roadmap.

The second step is to set up customer success triggers. These are events that happen within the software that indicates that the customer is or is not having success. By setting up these triggers, you can be alerted when a customer is struggling and reach out to them proactively.

For example, a trigger could be if a customer has not logged into the software in the past 7 days. This would indicate that they are not using the software and may need some assistance getting started.

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2) Do not overwhelm the customer with information

When a customer buys your software, they are usually excited and want to get started right away. However, too much information at once can be overwhelming and lead to them feeling frustrated or lost. It is important to give them just enough information to get started, and then provide more advanced training as they become more comfortable with the product.

When a customer starts using your software, it is important to provide them with the value from day one. This can be done in a number of ways, but one of the most common is through education.

Many software companies will provide educational materials, such as how-to guides, video tutorials, and webinars. This helps the customer learn how to use the software and get the most out of it.

It is also important to set up regular check-ins with the customer. This can be done through weekly or monthly calls, emails, or even in-person meetings. During these check-ins, you can see how the customer is doing and if they have any questions or concerns.

Building a relationship with the customer is essential to customer success. By having regular check-ins, you are able to build trust and show that you are invested in their success. These check-ins also give you the opportunity to provide valuable insights and feedback that can help the customer use your software more effectively.

One of the most important aspects of customer success is personalization. This means that you are tailoring the experience to each individual customer based on their specific needs. No two customers are alike, so it is important to treat them as such.

There are a few different ways to personalize the customer experience. One is to segment your customers based on criteria such as industry, company size, or location. This allows you to tailor your messaging and content to each group. Another way to personalize the experience is to use data from usage analytics to send targeted emails or messages. For example, if you notice that a customer has not logged into your software in a while, you could send them a message asking if they need any help getting started.

Personalization is key to customer success. By tailoring the experience to each individual customer, you can build deeper relationships and provide more value.

3) Build analytics around usage

In order to best understand how customers are using your software, it is important to build analytics into the on-boarding process. This way, you can track which features are being used most often, what areas are causing confusion, and where people are dropping off. This data can be extremely valuable in improving the customer experience and reducing churn.

There are a few different ways to do this. One is to use a tool like Mixpanel or Heap, which offer free and paid versions. Another option is to build your own analytics system using Google Analytics. Whichever route you choose, make sure you take the time to set up tracking properly so that you can glean valuable insights from the data.

Usage analytics can be extremely valuable in understanding what customers love about your software and where they may be struggling. By taking the time to set up tracking, you can ensure that you are providing the best possible experience to your customers.

One of the challenges of customer success is that it can be time-consuming. There are only so many hours in the day, and it is not possible to provide one-on-one support to every customer. This is where automation can be extremely helpful.

There are a number of different ways to automate the customer experience. One is to use chatbots, which can answer common questions and help direct customers to the right resources. Another option is to use a tool like Intercom, which allows you to send automated messages based on customer behaviour. You can also use automation to send targeted emails or notifications. For example, you could set up a system that sends an email when a customer hasn't logged into your software in a while.

Automation can be a great way to scale the customer experience. By using tools like chatbots and Intercom, you can free up your time so that you can focus on more complex issues.

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4) Reduce all the frictions from the beginning

From the very first interaction, you want to make it as easy as possible for the customer to use your software. This means having a clear and concise interface, providing helpful documentation and tutorials, and offering excellent customer support. By reducing the friction from the beginning, you will increase the chances of the customer sticking with your product.

One way to reduce friction is to offer a single sign-on (SSO) solution. This means that the customer can use their existing login credentials from another platform, such as Google, to access your software. This eliminates the need for the customer to remember another username and password and reduces the time it takes to get started with your product.

Another way to reduce friction is to offer a one-click import solution. This allows the customer to quickly and easily port their data from another platform into your software. This saves the customer time and hassle and makes it more likely that they will continue using your product.

By reducing friction, you will make it more likely that customers will use your product and continue to do so in the future.

5) Do not make any assumptions

Do not assume that the customer knows how to use your software or that they will automatically be able to achieve their goals. It is important to spell out exactly what they need to do in order to be successful. By being clear and concise, you can avoid any confusion and ensure that the customer is getting the most out of your product.

From the very beginning, you want to offer excellent customer support. This means having a team of knowledgeable and friendly customer support representatives who are available to answer questions and resolve issues. You also want to make sure that your customer support team is easy to reach, whether by phone, email, or live chat.

Customer support is one of the most important factors in customer success. By offering excellent customer support, you will increase the chances of customers using your product and decrease the chances of them churning.

On-boarding is a critical part of any successful startup.

These five tips will help you avoid the pitfalls of customer churn and ensure that your customers are getting the most out of your product. Building a strong foundation for customer success is essential for any software company. By following these best practices, you can set your business up for success.

If you would like to learn how to improve the efficiency of your business through automation and with these practise, we would love to show you how we can help! 

Book a no pressure discover call here and one of our Koridorks will get back to you as soon as they can! Or send us an email here.

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