According to research, the ability of a business to retain customers is even more important than their ability to acquire new customers in terms of earning potential. It's also far cheaper to keep customers than it is to earn new ones. That makes it essential to refine the art of eliminating customer churn. Customer churn is the loss of customers, which drives the need to attain new customers, which leads to a constant "churn" or changeover of the customer base. Here are several ways that the right CRM solution can help you reduce or eliminate customer churn.
1. Determine What is Causing Your Customer Churn
Customer churn tossing your profits overboard? Here's a lifeline.
A CRM (especially when you use data integration to sync the CRM with other systems around the organization) can help you determine the reasons for customer churn so you can eliminate the problems causing customer loss. Are customers complaining about prices? Quality? Customer service? Do customers feel valued? A CRM can answer your questions about why churn is occurring.
2. Learn to Engage Your Customers in Meaningful Communications
A CRM also empowers you to connect with your customers in a deeper, more meaningful way. Do they prefer phone calls after working hours? Emails? Chat sessions. The CRM helps you identify when your customer base includes strong social media users who are best reached on Facebook and Twitter. Then you can engage customers where, when, and how they prefer to keep communications strong and useful.
3. Educate Your Customers on Key Issues That Drive Churn
Many times, if customers know the why's of the situation, they are less likely to leave. For example, if your customers understood that your prices are directly related to your ability to meet rigid industry standards, would they be more likely to happily pay up? Perhaps you could help them understand more uses for the product or make it clearer how to take advantage of more difficult functionalities. The CRM will show you the gaps in understanding that cause your customers to defect.
4. Be Able to Identify the Customers at the Greatest Flight Risk
Which customers are most likely to leave? The CRM allows you to collect data over time and then you can identify the tell-tale signs that a customer isn't going to stick with you. At this point, you can decide whether it's best to invest more to retain more difficult customers or to focus your efforts on retaining customers that stand to be more lucrative.
5. Be Able to Define and Identify Your Most Profitable Customers
A CRM gives you access to the data on what's causing customer churn. It's your job to craft a fix for the situation with that data.
Similarly, the data from your CRM will help you pinpoint the customers that are most likely to stay for the duration and spend more with your business. Then you can focus efforts on retaining these customers, which inevitably is a far more profitable practice than trying to satisfy customers who won't end up staying no matter what you do.
6. Offer the Right Solutions and Incentives for Customers to Stay
What do your customers respond to? Are they suckers for a free offer, or do they prefer lots of content like how-to or product guides? There are so many ways to encourage great customers to stick around, and your CRM will hold the answers to what these tactics and strategies are. Some customers respond well to email coupons while others prefer social media contests. The CRM data will point your way.
Convinced that a CRM is the right solution for you? Accept this free e-book: The Essential CRM Buyer's Guide to get started choosing the right system for your organization. It's your gift from Bedrock Data.
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