If you have a recurring revenue business, do you know what your churn rate is? Have you dissected the data to understand precisely why customers leave? Are you using advanced analytics to identify trends and forecast potential trouble spots before they become a reality?
If you answered “no” to any of these questions, you’re a great candidate for Gainsight, the premier cloud-based customer success platform that focuses relentlessly on reducing churn rates and improving customer retention. Companies that derive an increasing proportion of their revenue from their installed base or from recurring revenue need to pay very close attention to churn rates or risk losing customers to their competition.
Every 2 percentage point improvement in retention or up-sell means a 20% increase in equity valuation for subscription businesses. That’s why companies are starting to care more about churn.
Companies have each developed their own lingo, approaches, and measurements to address churn. The real question is: what’s missing? If you have the process in place to collect data on churned customers, you have an opportunity to analyze and identify factors that increase the likelihood of churn. Subscription services companies must have exceptional insight into their customer data in order to quickly remedy situations that cause churn to occur.
Instead of a leaky bucket, let’s think of customer churn as something that results in a doctor’s visit, like recurring migraines or high cholesterol. It’s painful, annoying, and won’t go away. In your annual checkup, the physician asks a few questions; checks your eyes, ears, and heartbeat; and then performs some preventative health procedures.
While the cause of your company’s churn ailment might be indiscernible to the untrained eye, a Customer Success Manager can pick out these insights and improve your company’s performance.
