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Churn Prevention Strategies

Adriana Galgano is an Ottantaventi senior partner, instructor in Italy and abroad for companies of National and International importance. 

Often I’ve been asked: “What does churn mean ?”. Churn is used as synonym of loss or defection. It indicates customers' abandonment of a company.

Churn prevention strategies consist of principles and actions at companies’ disposal to prevent customer loss.

Important principles in avoiding churn are as follows:

• know our customers
   
• be quick to detect the intention of our customer to churn and act to avoid it 
  
  
• have a plan.

We will able to understand whether our customers are at churn risk only if we know their buying behaviour. For example, we know that it is three years that customer A has been buying from our company regularly. Our detecting system allows us to know that Customer A didn't buy during the month that has just ended. The presence of a plan allows those people encharged with the task to act with professionalism and speed. The more rapidly we act, the more opportunities we have to intervene before Customer A takes their final decision. If we delay action, Customer A may sign the proposal of our competitor in the meanwhile.

In the above situation we can try retention actions. An example of a retention action are the special offers made to customers who accept to change their mind and come back to our company. It’s important to consider that this kind of action is harder to run than churn prevention ones and is much more expensive.

In addition to purchasing frequency it is also important to know customers' profiles in order to be prepared to suggest a new proposal or new products and services. Re-signing an annual agreement under the same conditions of the previous year and later discovering a new and more advantageous offer from the same company while browsing on the internet or reading advertising material is highly de-motivating for customers!

Several strategies can be adopted to reduce churn. Among them are:

• using the already existing inbound or outbound service to verify the satisfaction of our customers and to propose new contract conditions
   
• organizing and running specific telemarketing campaigns 
  
• training salespeople to run churn prevention actions
  
  
• to run specific email marketing actions.

For all these strategies it is important to train people well. Unskilled churn operators will put our customers into the hands of our competitors.

Wish more information on our Churn Prevention Courses?

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