Reducing your customer churn rate should be a top priority if you want your company to be successful. Sometimes, however, it's difficult to put your finger on exactly why your customers chose to leave. This blog will discuss 4 ways that community can help you identify issues regarding customer satisfaction and reduce your churn rate.
As any smart business will tell you, the cost of acquiring a new customer (CAC) is much higher than the cost of selling to an existing one. As a result, one of the most important things a business can do is equip themselves with the tools and knowledge necessary to decrease their customer churn rate.
In case you aren't familiar with this term, churn rate refers to the number of customers that chose to leave within a given period of time. This number is often expressed as a percentage and provides a good indication of customer satisfaction.
Since the customer churn rate is a direct result of customer satisfaction, it's important that you know how to keep your customers happy in order to decrease your churn rate.
Community is one of the best tools available to do this.
Since a support community directly improves customer satisfaction, it also reduces the churn rate. A happy customer is one that will stay, and the best way to do this is through the proper management and curation of self-serve community support forums.
Here are the top 4 ways that community can help to reduce churn rate.
1. Community Data Identifies Top Priorities
Statistically speaking, most customers will leave you because they feel as though they aren't being treated well. "Not treated well," however, is incredibly vague as there are numerous factors that can lead a customer to feel mistreated. How then, do you know what issues have the largest impact on your churn rate?
Well, if you're in business, I'm sure you know that data = everything.
One of the benefits of a community is that it creates space for authentic conversations about your product or services. With all the information about your product and services being produced in an environment that you control, you essentially have access to a wealth of information. All you need to do is use it.
The data collected from your community will give you invaluable pointers as to what business areas need improvement.
Further, while it might be uncomfortable to say out loud, the reality is that not all customers are created equal and some have more business value than others. Truth be told, 80% of your future profits will come from just 20% of your existing customers, so you need to be on top of their issues as soon as they occur!
With the proper backend integration, a community can provide you with the ability to alert your customer service team when a high-value customer interacts with the forum. If the interaction shows that they're unhappy about something or need help, agents can quickly follow up. This lets the high-value customer know that you care, which gives them another reason not to leave you.
2. Community Anticipates Future Problems
If one customer has a problem with something, odds are that others will as well. Community forums provide a solution to this with the following two benefits:
1. Community can provide quick and accurate responses to all questions.
2. Others can see questions that have already been asked and easily find answers.
A support community provides a business with solid information about customer experience and customer support issues. This information can be used to predict what problems customers may develop down the line. The ability to map customer journeys and anticipate issues during every part of the journey is known to play a critical role in boosting customer satisfaction.
For example, let's say there's a new product release. With the proper search functionality, customer service agents can monitor their community to gather real-time feedback about problems with the new product. They can then pass information to the product developers so that changes can be made quickly. Community can therefore provide you with a more efficient way to get immediate feedback so that issues don't snowball.
Ultimately, with a support community, you are able to respond to and address customer issues as they occur. This improves customer satisfaction and helps to reduce churn rates.
3. Community Provides For Better CX
Providing timely responses to customer inquires are more important now than ever before. In fact, statistics show that the highest contributing factor to customer experience (CX) is fast response times.
With expectations increasing as technological capabilities expand, it's no wonder that your customers demand service "now." It's therefore crucial that businesses adapt their CX models to match customer demands or be left behind.
Customers want self-service. They don't want to talk to your customer service reps and want to be able to find answers on their own. In fact, 90% of customers expect you to have a self-service option, so if you don't have a support community to provide this service, you might be seeing a higher than average churn rate.
Further, if you look at the other top factors contributing to CX (see the chart above), a support community enables most of them. For more information on the benefits that community can bring to your business, take a look at 5 reasons B2B businesses need support communities.
4. Community Delivers The Best Feedback
Feedback is the backbone of any business; without it, you won't know what you're doing right and what you're doing wrong. If you don't know what you're doing wrong, your customers will suffer and you'll likely see a higher churn rate.
You, however, aren't the only one that benefits from feedback; in fact, your customers actually want to provide you with feedback. Statistics show that 77% of customers will view your business more favourably if you ask for and accept customer feedback.
Making your customers happy and making your business better is as simple as providing a space for discussion and feedback. Community does this the best since it categorizes topics and discussions so that customers can provide their input on the areas that matter most to them.
Further, referring back to number 1, feedback in a community can easily be collected and analyzed to identify your top priorities.
At the end of the day, the more effective your customer service is, the less likely your customers are to churn. Community is one of the best tools out there to help you improve your customer service and customer satisfaction.