What To Do With a High Churn Rate - Deepstash
What To Do With a High Churn Rate

What To Do With a High Churn Rate

Curated from: productschool.com

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 If your business is a bucket, you can keep pouring as much water (customers) as you want into it, but if you have a lot of leaks, you’ll never fill the bucket. Without filling the bucket, you’ll never achieve growth.



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Customer Churn vs Revenue Churn

  • Customer churn refers to how many individual customers have deleted their accounts, cancelled their subscriptions, or not logged in for X amount of time.
  • Revenue churn focuses on the value of these customers, and measures the monetary loss of the future transactions rather than the loss of relationship.


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Identifying The Source of the Churn 1/2

  • Competitors. If a new competitor has appeared in your industry and is making some serious waves, it’s natural to expect a peak in your churn rate as customers shift.
  • False advertising/disingenuous marketing. This is why marketing teams deserve a lot of credit for customer retention. Bad marketing leads to churned customers, who may arrive at your product with the wrong expectations.
  • Usability/accessibility issues. An interface that isn’t easy to use, appealing to look at, or adaptable for those with special needs, will be dropped like a hot potato.


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Identifying The Source of the Churn 2/2

  • Bloated price point. If the price isn’t justified by the value the product provides, customers will likely search for an alternative.
  • Reduced functionality. Did you scrap a feature that you thought no one liked? If you then see floods of users abandoning your product, it’s probably missed!
  • Unmet needs. Quite simply, your product doesn’t meet the need or solve the problem the way the customer thought it would.
  • Poor customer service. Word of mouth is a powerful thing, and a bad customer service experience can ruin a customer relationship for life.


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How to Reduce Churn 1/2

Damage control

Recovering from a loss of trust is hard, but not impossible. The key is not to shy away from the conflict, but to lean into it. Pretending that the controversy doesn’t exist will only deepen the distrust between you and your customers.

Rewarding loyalty

While many companies focus heavily on providing discounts and freebies to new customers, it’s a grave mistake to ignore your existing customers. They should be rewarded for their loyalty just as much as you reward new customers for taking a chance on you.


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How to Reduce Churn 1/2


While not a step that should be taken lightly, if your product/service is one of the older ones on the market, it could have fallen out of fashion. Branding is a very powerful thing, and customers are paying attention to design now more than ever!

Talk to your customers

If you’ve ever cancelled a subscription before, you’ve most likely been on the receiving end of a ‘we’re sorry to see you go’ message, along with a short survey about why you’ve decided to cancel.


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Generalist. Great minds discuss ideas, average minds discuss events, small minds discuss people.


Reducing churn for digital products.

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