Understanding customer churn is critical to sustaining a healthy business. Knowing how and why customers leave and what can be done to win them back underpins efforts to target new markets and product requirements. As a data-driven process, churn management has matured into a mission-critical task that companies depend on to make sense of the market.
But no two companies are alike. An acceptable churn rate for one may be catastrophic for another. Even identifying when churn has occurred can be challenging: It may be sudden and deliberate or gradual, implicit and unconscious. For example, a SaaS subscriber may let a service expire for unknown reasons and then rejoin a month later. Does that count as churn? If so, how is it quantified?
Every company is bound to have some level of churn. No matter how great your company’s products or services are, people and markets are always changing. The key is finding the sweet spot where you’re not forced into an economically unsustainable model of finding new customers to replace old ones. This challenge isn’t new. But today’s digital landscape allows us to take a more granular look at customer behavior—one that calibrates the retention versus acquisition question to individual behaviors.
Although it’s deceptively simple to calculate turnover with a simple equation—divide customers lost by the total number of customers in a given period—learning how, when and why churn is occurring is more nuanced. You need a comprehensive view of the entire customer experience. One way to navigate that complexity is with data and artificial intelligence (AI).
Continue reading: https://www.forbes.com/sites/forbestechcouncil/2022/09/13/how-ai-can-help-deal-with-customer-churn/?sh=1efd9e227978
But no two companies are alike. An acceptable churn rate for one may be catastrophic for another. Even identifying when churn has occurred can be challenging: It may be sudden and deliberate or gradual, implicit and unconscious. For example, a SaaS subscriber may let a service expire for unknown reasons and then rejoin a month later. Does that count as churn? If so, how is it quantified?
Every company is bound to have some level of churn. No matter how great your company’s products or services are, people and markets are always changing. The key is finding the sweet spot where you’re not forced into an economically unsustainable model of finding new customers to replace old ones. This challenge isn’t new. But today’s digital landscape allows us to take a more granular look at customer behavior—one that calibrates the retention versus acquisition question to individual behaviors.
Although it’s deceptively simple to calculate turnover with a simple equation—divide customers lost by the total number of customers in a given period—learning how, when and why churn is occurring is more nuanced. You need a comprehensive view of the entire customer experience. One way to navigate that complexity is with data and artificial intelligence (AI).
Continue reading: https://www.forbes.com/sites/forbestechcouncil/2022/09/13/how-ai-can-help-deal-with-customer-churn/?sh=1efd9e227978
