Which customer can be considered a churner
A churner is one who has stopped using the company’s products. The details depend on the business: cancelled a subscription, did not make a repeat purchase for a long period, went to competitors. If the customer’s life cycle – the path of their interaction with the brand – has come to an end, it will not be possible to bring them back. But if they are on the verge of leaving, you can try to apply the mechanics from our article.
When assessing the risk
of a user leaving, they usually focus on the average frequency of purchases, which depends on the business sector, the characteristics of the target audience and other factors. If the period since the last order has exceeded brazil phone number data the average for the company, then this
customer has left. For example, the average frequency of purchases in a store is once every six weeks. Irina has not made a purchase for three months, which means we classify her as a churner.
To determine how effectively a company copes with customer churn, two indicators are calculated: Retention rate and Churn rate. Retention rate – the customer retention rate – shows the percentage of customers who remain with the company for a given period. The formula looks like this:
Why work on customer retention
For a business to grow, it is important not only to attract a new audience, but also to develop old customers and try to realize their potential to the maximum. Here’s why it is profitable:
An active customer base reduces the costs of product promotion and increasing recognition.
Regular customers provide stable sales, which allows you to at least maintain profits at the current level.
The probability of selling something to an existing consumer is on average 60-70%, while a new one will buy with a probability of 5 to 20%.
If you build a loyal community, customers will become advocates and why fine dining restaurants choose lightspeed restaurant promoters of the brand and will stay with you even if there are favorable offers from competitors.
Why customers leave and how to retain them
To get a customer back, you need to understand why he left. Here are the most common reasons:
Didn’t like the product or service.
Competitors offer more favorable conditions.
The offer has become irrelevant – the person has grown out of the target material data audience age, changed their place of residence, lost income, stopped growing a beard or getting a manicure in a salon, etc. Some reasons do not depend on the company, but in most cases the audience’s decisions can be influenced.