If you’re running a subscription-based business, then you’re probably aware of the devastating effects of customer attrition. It doesn’t matter if you can get many customers to sign up because, at the end of the day, subscription-based businesses rely on long-term revenue. With a bad enough attrition rate, you could even end up spending more on acquiring customers than actually getting revenue from them.
One thing you should keep in mind is that signing up for a service can also be a hassle to your customers. This means customers won’t just terminate their subscription unless they have a good enough reason. Unfortunately, such reasons can emerge quite often and suddenly, especially if your company doesn’t have a good grasp of accurately measuring customer retention. Here are the major causes of customer attrition, and what you can do to keep these people who matter a lot to your business.
- Customers are no longer using your service
Did you find out that some customer accounts are no longer being used as much as before or have been inactive for such a long amount of time? That means your customer doesn’t need it as much as they did when they signed up. Keep it that way, and they’ll have more than enough reason to terminate their subscription.
What to do: It’s still possible to keep inactive accounts from being terminated. All you need to do is give them enough reasons to continue their subscription. For instance, you could increase the quality of your service by offering loyalty reward programs, providing incentives, or even straight up adding features that they might find useful. This way, the regular subscription fees are justified, and your customers will be encouraged to keep on supporting your products or services.
- They can’t access your services
Sometimes, your customers badly want (or even need) your products or services but something is keeping them from accessing these. This is related to the first point in this list because they’re still getting little or no value from your offerings despite the fact that demand actually exists. There’s a good chance that your customer will just look into your competition for the same types of products of services.
What to do: There are plenty of factors that can keep your customers from accessing the products or services they need. These include failed payment issues, incorrect account information, delays in setting up the service, or even getting signed up for the wrong subscription. Hear your customer out and use feedback mechanisms to pinpoint what needs to be addressed ASAP.
- They don’t like you
It’s not always about the quality of what you can offer them. Sometimes, customers end their contract because they do not like the company itself. It could be because they had a slew of bad experiences with talking to your customer support, or they might think that your company is giving them way less than they paid for. In any case, an angry customer wouldn’t mind dropping the service if they have the option to switch to another provider.
What to do: Never underestimate the power of building good rapport with your customers. Set protocols on how to handle customer requests and feedback to make sure they are properly treated. Just being polite to your customers can go a long way in developing customer loyalty.
- They think you don’t like them
Some customers leave because they don’t feel like they’re valued customers, even if you’re providing them high-value services. The lack of a more personal connection with your customers sets the tone that they’re just another source of revenue to you. As soon as they find another provider that have the same services but appreciates them better, don’t be surprised if your subscription numbers drop.
What to do: Think of different ways to show how much you appreciate your customers. You can keep them updated with the latest promos, send them greetings during holidays, or thank them for being able to pay on time. You can also provide incentives if they remain subscribed after a set amount of time. Any combination of these appreciative gestures will send the message that you care about them.
Customer retention is the lifeblood of any subscription-based business. Being able to maintain good customer relations is possible if you know what problems keep them from being loyal to your business. Moreover, you should also be willing and well-equipped to deal with those problems.