How to Reduce the Churn Rate of a B2B Business?
The churn rate is a big thing in the B2B business world. Without any ambiguity, B2B consultants agree that churn happens despite you doing everything right. There are always some clients that are not happy with your products or services, but it does not mean a business should let the churn happen. This would be the perfect recipe for disaster.
According to research from Bain & Company, a 5% increase in customer retention can increase profits by 25% to 95%. There are numerous statistics that show existing clients are goldmines. A successful business should do everything possible to retain existing customers. In this post, we will look at the five effective ways to reduce the churn rate of a B2B business.
- A Clean Onboarding Process
This is the most important thing if you are selling professional services to clients. For example, if you are a B2B business in the professional services industry like the IT industry and offering a SAAS solution to your client, it is very important that you should have a well-defined onboarding process to tell your client about how to use the software effectively. Top companies often appoint dedicated onboarding agents to ensure a client completely understands to use the product and is supported after the onboarding journey too.
- Ask for Feedback Often
Once you have sold your product to a client, it means you have fulfilled the initial expectations of the client, but it does not mean the needs or expectations of a client will not change. You should ask for feedback often to understand how a client feels about the product or services. It is often said that a customer’s frustration leads to churn. If a client has made contact with you regarding any issues, try to address them immediately or provide the assurance you are working on it.
- Identify the Signs of Churn
It will be too late if you act after the client has stopped using your product or services. Identify the signs of the churn. There are many. For example, a client has not used your product or service for a few weeks, added negative reviews about the product, cancelled a subscription, or uninstalled your app. These are the signs that tell a client is about to churn. It is your responsibility to be proactive in the communication, try to address the concern, and provide the required solution.
- Learn About the Best Clients
Even if you have identified the clients that are about to churn, some of them will inevitably lead to the churn. In this case, you have to learn about the clients who are the most profitable and best interest of you. For example, you have identified the five clients that are about to churn. You can hold them by offering promotional deals and discounted prices, but you need to find out will it be profitable for you.
- Stay Competitive
In an ideal world, this should not happen. But if your competitor has come up with something new or an attractive offering, it is quite possible that your client is going to turn to your competitor. Therefore, it is very important you stay competitive and able to cater to the changing demands of your customers. Have a close look at the competitors’ solutions and find out where you are lagging. There are some customers who anyway are going to shift to your competitor, but you need to find out; are they a bad fit for your business, or is it something you’re doing that’s pushing them away?
So, these are the five effective ways to reduce the churn rate of a B2B business.
