However you slice it, customers make a business.
Without their buy-in or engagement, a company is obsolete. That’s why customers should always be at the heart of every business decision you make. But sadly, you can’t win them all. Worse still, sometimes you lose the ones you did win. 💔
It can feel like an uphill struggle, trying to re-engage customers who’ve been lost to churn and are therefore no longer part of your clientele. It’s a situation all businesses will find themselves in at some point.
The solution? Have a strong customer success strategy in place.
This article will look at the different types of customer churn, how to re-approach lost customers and how to effectively win them back.
After all, it’s a well-known fact that it’s more cost-effective for businesses to retain customers than to seek out new ones.
How to approach a churned customer
We get it, approaching a churned customer can be super daunting and might feel like a bit of a minefield.
What’s the right protocol? What should your email template look like? How do you communicate tactfully? These are all valid questions and ought to be handled carefully, as the last thing you want to do is alienate a churned customer even further.
If you’re trying to re-engage churned customers then at least you know they’ve previously harbored an interest in your product or service. They have a vested interest in your offering at some point, so use this to your advantage.
Before we take a look at how to re-engage a lost audience, let’s first get to grips with what churn really means.
The different types of customer churn
The groundwork has already been laid and the customer’s appetite is whet, but for some reason, things have gone awry. A customer abandons ship, leaving your product or service behind, joining the churn pile.
Churn is the antithesis of customer retention and an unavoidable part of business life. Every company will lose customers at some point and this could be in one of two ways: voluntary or involuntary churn.
If a customer makes the decision to end their subscription, this is called voluntary churn; they’ve actively made a choice to no longer buy your product or use your service. This could be because they’re dissatisfied with the product and/or service, or perhaps the cost is too high. Maybe a competitor is offering something better and/or cheaper.
Involuntary churn is pretty much what it says on the tin. For whatever reason, a customer is no longer actively subscribing to your product or service due to an unavoidable payment error, or insufficient funds. The customer still wants your product or service, there just seems to be an issue with their method of usual payment.
The ways you should approach these two different types of churned customers vary, but both need to be handled with tact. By calculating churn rate and understanding which customers actively chose to leave your organization and which ones didn’t, you can formulate different strategies to win them back.
Voluntary churn is an incredibly nuanced spectrum; you need to put yourself in the customer’s shoes and consider why they left. See it from their perspective. 👀
Common reasons for voluntary customer churn include:
- Poor customer service 👎
- Poor user experience (UX) 👎
- Poor quality of the product and/or service 👎
- Value for money 💸
- Confusing updates to your service leads them to feel overwhelmed or unsure of what they’re getting for their money. 🧐
It all really boils down to intent and customer experience.
Keeping track of why customers leave is incredibly important. More often than not, one (if not more) of these reasons can be the straw that breaks the camel’s back. By getting feedback and logging customers’ reasons for churning, you can detect common patterns and deduce whether one specific area is hemorrhaging your retention rate.
In a report by Zendesk, it’s cited that a whopping 52% of new customers in B2C organizations stop their payments due to poor customer service.
This feeling of neglect and poor onboarding is conducive to a high churn, and avoiding this is one of the main crusades undertaken by Customer Success Managers (CSMs).
Customer success teams use metrics like churn rate to calculate how many customers they've lost within a specific time period. Churn rate is a metric used to measure how many of your customer base no longer use your product or service.
It’s critical to act fast, especially if your business has a high churn rate (high turnover of customers).
Without a proper customer success strategy in place to re-onboard your lost customers, you’ll start to see serious dents in your revenue, reviews, and reputation. can lose an indecent amount of money by allowing customers to walk away.
By implementing a strong customer success strategy, you can calculate and monitor your churn rate. ✅
As we mentioned earlier, involuntary churn might seem like an unavoidable process and something that’s well out of your control. But to a certain extent, it’s the less troublesome of the two churn types; the customer doesn’t dislike your product, there was simply a payment error on their end.
Surely the onus is on the customer? Alas, no. This is something entirely avoidable, and not properly managing involuntary churn can creep up and seriously damage your business.
We’ve all been there and forgotten to update our payment method for a subscription. You’re then left frustrated when you can’t access your songs, films, or purchase history – whatever it may be.
Often the customer doesn’t know their card has been declined, or that their billing information isn’t up to date, and they find themselves locked out of your service. If you don’t act fast, your customer could end up feeling neglected or very quickly give up on rectifying the issue.
Fear not! There are ways to get on top of involuntary churn that’ll minimize the consequences to your business. Unlike voluntary churn, you don’t have to make any changes to your product or service - you just need to make the payment process (and any problems that arise within it) more streamlined.
This is where the infamous proactivity of customer success comes into play. 💪
You can get ahead of involuntary churn by sending reminders – via whichever form of communication suits your audience – to update subscriptions, payment methods, etc.
By setting up in-account or in-app notifications to alert the customer that their card details are expiring, you can preempt and prevent churn. The expiration date of a debit or credit card is easily accessible – everything is at your fingertips and it’s on your customer outreach team to take action.
Of course, if you miss this deadline, you can still reach out to your customers by email, or phone. Email is a double-edged sword though. It can be fantastic for reaching out to customers, but it can also be detrimental if you send too many.
By keeping your re-onboarding email template light with a clear call to action (CTA), your chances of winning a customer back are high.
Now we’re clear on the different types of customer churn, let’s take a look at how you can approach and (hopefully) re-engage lost custom. 🤞
Ways to reactivate churned customers
Reach out to them
Wanna win back your lost customers? The best place to start is by getting in touch with them. 👋
It’s no good sitting around complaining about climbing churn rates. You need to be proactive and deal with the situation at hand.
One way to do this is by going old school and calling them up. Keep the conversation friendly and polite; whatever you do, make sure you don’t hound them for leaving you! A churned customer doesn’t want to be told off – they don’t even know they’ve done something wrong, they’re just looking for the best deal and the best solution to their problem.
Introducing new features, cheaper prices or a discount is a good way to ease their frustration and change their perception of you and your product.
A win-back email campaign is another great way to reach out and get the attention of any lapsed customers.
Just remember to keep the incentive relevant to the customer and make sure it’s something that will add value for them. Let’s be honest, no one wants to open an email, or be intrigued by a discount, only to discover it’s the marketing equivalent of receiving a pair of socks for your birthday; is always a big no-no.
When it comes to your email messaging, the way to stand out is to identify your USPs and demonstrate to them why your product is better than the rest.
However, you won’t be successful if you don’t have a catchy subject line. Having a striking, strong subject line really makes or breaks your re-onboarding campaign, along with the visual design. If your email looks unappealing and your message is dull, don’t be alarmed if your re-onboarding is unsuccessful.
Why should the customer re-invest in your product if you can’t even create an enticing email for them?
Win them back with incentives
Providing benefits is an attractive way to lure customers back in.
It’s no great secret that everyone loves a bargain. A great way to keep a customer’s interest piqued is to offer them a discount on their next purchase, keeping your tone of voice light with an emphasis on the customer.
A good example of what we mean here:
We haven’t heard from you lately, but we’d love to.
You mean a lot to us, so we’d thought you’d like 15% off [x]
Get your discounted [product] now!
Include a clear CTA at the bottom of the email and ensure that the discount is prominently displayed. 📢
You know there was a reason they initially invested in your organization in the first place. It's just a matter of rekindling their initial desire to consume and offering a discount is a proven way to do this.
In the case of win-back strategies, you’ve already laid the initial groundwork to onboard them, so at this point, it all lies in the art of persuasion. Ultimately, you’re trying to show how indispensable they are by restoring the customer’s value.
Other ways to win churned customers over include:
- Offer to upgrade them to a better product package with improved features
- Provide them with extra support from your customer service team
- Offer free training opportunities
- Use a loyalty reward option for added motivation
Failing any of the above, a good way to get the customer’s attention is by offering a free trial of your best package. It’s a classy, slick, and attention-grabbing way to showcase your company at its best. This can be a particularly potent offer if the customer has had a poor prior experience with your product/and or service.
And let’s be honest: who doesn’t love a freebie? 🙋♀️
Give them FOMO
Ah FOMO – fear of missing out. We’ve all experienced it at one time or another. It isn’t solely applicable to weekend plans with your friends – it can be adopted by businesses too.
Inciting a good old bit of FOMO is a great tactic to employ with lapsed customers as it makes them envious of those with access to your product or service. Do it well and they’ll be ordering a slice of the pie for themselves in no time.
With the right incentives in place, you can strategically make your product more alluring by re-framing the narrative to ensure the customer is the main focus. The product is still the same, but by honing in on its value and benefits to the customer, you can show what it can do for them.
When executed correctly, you flip the conversation and inform the customer that your product has the potential to:
- Saves user time 🕑
- Increase value – they’ll actually save money 💰
- Help them achieve their goals 📈
- Be unmatched in the market 🥇
Whether you reach out via email or phone, by structuring your communications towards your product’s perks, you stand a better chance of rewriting the ex-customer's image of you.
Mutual engagement plans
Customers don’t always properly engage with a product and there can be a lot lost in translation, culminating in a poor relationship and a high churn rate.
Looking through the lens of the customer, you need to ensure they know how they’ll benefit from your product through your re-onboarding efforts. Show the customer that you intend to provide tailored support in the future for their specific needs.
It’s incredibly important to manage customer expectations by supplying them with key milestones and offering assistance to the customer to meet their desires. You’re the expert, after all, and clarity of communication and trust are of critical value at this stage.
In a nutshell
Having this plan of action prepared in advance is a brilliant way to catch canceled customers before it’s too late. If you learn about their specific situation, you can avoid repeating the same mistakes for future customers.
It can be tricky to know exactly how to approach re-onboarding customers – it really depends on your business model and the reasons the customer left. The good news? You’ve now got plenty of tactics up your sleeve.
Pricing, user experience, and customer service are three of the most common reasons for churn. Identifying these issues and tactfully presenting genuine solutions can make an enormous difference to not only your brand image but the customer’s ability to fulfill their goals with your product.
Our top tips are to act fast, act with tact, and ultimately, listen to your customers. 💥