In the first part of the churn article series, we looked at customer churn in the eCommerce business, why it’s important to track and how to track it.

In this part, we are going to be looking at the only thing marketers are interested in when it comes to churning - how to reduce churn.

As established earlier, customer churn is the silent killer.

Customer acquisition is important but if you can’t retain the acquired customers, your business can’t survive in the long run.

Here’s why

A typical eCommerce store depends on paid advertising as the main source of customers, even those that get a lot of organic traffic often run retargeting ads to convert more customers.

Therefore every customer comes at a cost. If the cost of customer acquisition is higher than the revenue generated from those customers, the business doesn’t generate a return on investment.

For example, if it costs $100 to acquire a cost and each customer stays long enough to spend at most $80 in their lifetime, your business makes a $20 loss.

This is why it’s important to retain your customers long enough to return on investment and maybe generate extra revenue with every repeat purchase.

There are many strategies you can use to reduce customer churn before you implement any quick fix tactics, try to understand why this is happening.

Remember when it comes to churning, small improvements can have a bigger impact, so take action.

Here are some of the tactics you can use to reduce churn.

1. Customer feedback

When a customer churns, they have basically ended a relationship with your business. And like any relationship, the key to moving on is knowing why it ended in the first place.

Why did your customer stop buying from you?

Is it your messaging, customer service, shipping time, product quality or competitor offers? There're many factors influencing a customer's buying experience that you can’t optimize all at once.

To zero down on what we should improve first, you need customer feedback. 

Getting customer feedback enables you to learn about their experience as they move down the funnel and identify any problem areas they find while interacting with your brand.

Such problem areas like checkout issues, shipping delays, product quality, can be identified and improved.

eCommerce businesses can get churned customer feedback in a number of ways including;

• One on One outreach 

Outreach can be done via email or phone call. This is one of the best ways to collect feedback because it comes directly from the source and it’s not limited to much data about your customers’ experience you can collect.

• Survey  

These are great because you still have control over which questions are answered and can be used to collect feedback in real-time as churn occurs. You can use an exit or prospecting survey to check whether customers are satisfied with their experience and if not, you can still get insights into why not.

• Social media and online reviews 

People share their life experiences on social media including their experience with your brand. If you want to learn more about why customers are leaving, try monitoring social media brand mentions and reviews.   
Reviews are like the final test your product has to pass for customer satisfaction. Monitoring how people talk about your product or brand online will help identify key areas to improve.

Customer feedback is crucial to reducing churn because it’s the only way to learn about their experience with your brand and whether your product is fully satisfying their need or not.

Remember to implement changes based on the feedback collected. Customers are always happy with brands that show utilize feedback to improve customer experience.

2. Attract the right traffic

Sometimes, customers leave because they are not the right fit for your products.

This is perfectly fine.

It’s the reason why every business big or small experiences some level of churn.

Not all traffic generated is right for your business, and even when they convert, it’s not a guarantee that they will stay.

This usually happens when people (probably from organic sources) who don’t fit your target customer profile convert on your offers but fail to make repeat purchases.

One way to make sure you attract the right traffic to your store is through segmentation

Here’s how:

With segmentation, you can create a group of customers with the desired retention rate like Jon and Julia in our previous example and focus on attracting traffic that looks like them.

Most of the advertising platforms today include Google and Facebook allow you to target specific audiences that match your customer profile. 

This way you can focus your advertising to attract only customers that you’re sure will not churn.

At Humanlytics, we use data to help eCommerce businesses create different customer segments to achieve marketing goals like increasing revenue or reducing churn. 

Using Dataslinger, we are able to access more customer data from different channels, analyze it, and provide you with actionable insights into the audience you should attract so as to achieve goals like reducing churn.

3. Customer support

Lack of support is always one of the reasons customers churn.

No matter the issue, if a customer reaches out to your support for help, they don’t care about how many other issues you are trying to solve, they only want to know that you’re working on solving their issue in a timely manner.

And if you fall short, there’s a chance that the customer will be lost.

To a customer, an unresponsive support team is a sign that your brand doesn’t really value them and their time. That’s why they quickly look for alternatives.

Here are 2 things your support needs to have:

• Support needs to be provided in time. It shows that you actually care about supporting your customers and the needs they are trying to meet with your product. However, this becomes tricky to accomplish if your customers are in different time zones and you may require additional staff to meet the need

• Support for customers has to be easily accessible. If a customer can’t find a way of accessing support when they need it, it’s the same as not providing it. 

Make support accessible by showing customers the different options of reaching your support which can include, phone numbers, email addresses, and or through live chat. 

By providing support to your customers helps them achieve their goals and realize the value in your product which at the end of the day helps reduce churn.

4. Retention offers

At the end of the day, you have to give your customers a reason to come back.

Think about it, every day we are all exposed to different products, brands, and messages that can distract your customers from buying again.

That’s why you have to stay on top of their minds throughout their buying journey and this can be done through retention and loyalty campaigns.

For example

Such campaigns can help you reduce customer loss in two ways:

• Show your existing customer that you value their business

• Offer them an incentive to buy from you again

These campaigns go a long way in building customer loyalty if they keep coming to buy from you time and time again.

In eCommerce, it’s important to test different offers to determine which works best at curbing churn before spending more resources.

Conclusion

This concludes our customer churn article series and the one key takeaway is:

Customer churn is one metric you can’t improve in one day’s work (possible but not likely).

It’s something you need to continue tracking and analyzing to make sure you prevent the loss of your hard-earned customers.

Before you take action, be sure to have a clear understanding of how and why you are losing customers in order to reduce the loss.

There are obviously so many other ways you can reduce churn but I hope this article provided enough information for you to take action.