Every company wants to provide a product that continues to make customers happy and meet their needs. This will provide a strong rate of customer retention and allow the company to continue to grow.
To do this, customer churn must be reduced.
But, first, you need to know exactly why they churn. Taking the time to dive into customer churn feedback will save not only money but also time invested in acquiring new customers. According to Forrester Research, it costs 5 times more to acquire new customers than it does to retain your existing clients.
Like most companies we wanted to increase our retention rate and one way to understand what customers did not like about our product or experience was to ask them why they left.
So that’s what we did. The churn feedback helped us decide what we should build next to keep our customers happy and even to iterate on our business strategy.
Let’s talk about our process and how you can implement it in your business too.
“When customers share their story, they’re not just sharing pain points. They’re actually teaching you how to make your product, service, and business better.”Kristin Smaby
How To Collect Churn Feedback
Collecting customer churn feedback provides valuable insights into what is working and what may not be working with your product.
The goal is to uncover exactly why customers are deciding to churn away. Did they have different expectations? What pain point went unanswered? Was it an issue of timing? Could they not get out enough value?
We decided to add a mandatory Text Field to our product unsubscribe page and asked all churning customers: “Why are you leaving?”
You may think people don’t like to be bothered with giving feedback when they already try to leave the product. But, to our surprise, 94% of churning customers did give valuable feedback!
This is a perfect opportunity to find out why customers may feel the product or service is not working for them. And how to improve the customer experience.
Let’s take a look at a few examples of what we at Usersnap gathered from our churn feedback and what we were able to learn from it.
Customer Feedback ?
|“This is a great service but we only needed it for one month during the launch of our new website.”|
What We Learned ✨
|When the use case of the Usersnap product is project based, the lifetime of the customers is limited.|
Customer Feedback ?
|“Great product. Our client didn’t use it… We set it up for them to submit tickets and they didn’t submit. Will plan on trying this product again in the future, however.”|
What We Learned ✨
|Despite low usage, the customers liked the tool. This presents a possible need for better communication and more customer support that may be able to improve the situation. In a situation like this, it could be useful to reach out to a customer who is not actively using the software.|
Customer Feedback ?
|“The software is great and I would continue using it but I don’t like having two floating icons on the screen (One for Usersnap and the other for Live Chat). If there was a way to integrate it with our chat provider so there is just one floating icon in the bottom right it would be perfect (users can either start a live chat or submit a bug using Usersnap). If you have a solution to this, please let me know. Thank you!”|
What We Learned ✨
|This was a feature suggestion that was very easy to implement. Once we built it we reached out to the customer to demonstrate the feature. This feedback offered an opportunity to not only improve the product but also save a customer from churning.|
How To Analyze Customer Churn Feedback
Measuring customer happiness with your product is crucial for success. But nothing can be gained from it without effectively analyzing the feedback.
Just like collecting other sources of customer feedback and analyzing it, the most effective way to analyze customer churn feedback is to tag and categorize them. This allows you to group responses together and determines what the top reasons for your churn are. More importantly, this proactive approach allows you to see what improvements or changes may need to be made.
When looking at the grouped responses, it is important to ask questions to help determine what needs to be done.
Ask yourself: what is critical and needs to be addressed immediately? What is the fundamental problem customers are trying to solve? Will the product requests also drive new customers? How can the product increase customer lifetime?
These types of questions help you and your product team to decide what feedback is worth proceeding with and what features or solutions to tackle.
At Usersnap, in analyzing our customer churn feedback, we were able to determine the top three churn reasons. They were:
- Projects ended (35%)
- Price (23%)
- Not enough usage (12%)
This made us rethink our functions. Which then leads to more action-based questions.
If we want to provide more value for our customers and extend their usage with our tool, what should we build? How do we build a product that customers will continue to need after QA feedback process is over?
After further investigating the feedback and discussing the results within the management team, we decided to iterate our strategy and expand to new use cases for our feedback product.
Usersnap expanded from collecting QA feedback to also collecting end-users and customer experience feedback. We built new features that enable teams to collect ratings and NPS as triggers to encourage the users to give qualitative feedback.
Understanding customers motives is the best way to build products and services that matter. By extending our product with these rating and feedback collection features we can move further up in the product life cycle, become stickier and more relevant.
[Tweet “Usersnap’s fascinating journey in collecting Churn Feedback and iterating their product strategy has inspired me. #MakeFeedbackMatter”]
Reasons Why Customer Churn Feedback Is Powerful
Customer churn feedback is extremely powerful for company decision making. It has certainly played a weighty role in our business and brought us to where we are today!
Here are the 5 most noteworthy reasons to why you need to start collecting customer churn feedback:
1. Understand what customers are using you for
Different customers may use your product for different scenarios and goals.
Although you might think that you as the “parent” of the product already know why your customers use and love your tool. The creativity and sophistication (or lack thereof) of your customers may come as a surprise.
Through churn feedback, you can gain a profound understanding of customer use cases.
Take our example, our web agency customers. They implement our platform for QA and project approval purposes to collect design feedback from their clients. Which is very different from our other customers, software companies and e-commerce.
Customer churn feedback is going to allow you to pinpoint the different uses of your products and what the needs may be within each type of usage.
2. Uncover major variables of the customer lifecycle
You will uncover things like the initial customer intent in using your product. Customers may have set out to use the product only during a certain timeframe. Or your product is fantastic for smaller sized companies but as they grow they also outgrow the initial advantages.
The churn feedback clarifies the variables to why they end your relationship and possibly switch to another service. This will help your company see the full picture of a customer’s lifecycle.
3. Control customers churning before it happens
Gathering customer churn feedback will quickly pinpoint the top churn reasons. Allowing you to pivot and react proactively to respond to pain points.
This helps you understand churn patterns and foresee the drop-off.
You can address the customers showing signs of churning and reduce churn once you have grasped the trend.
4. Gives insights to customers’ unresolved needs
Churn feedback will shed light on customer needs that you and your company may not have been aware of. Or needs that may have been underestimated in the beginning.
You may or may not be able to provide a solution right away. But this is powerful information for you to develop and widen your services.
5. What is the company’s potential next step
Some customers will directly tell you what feature they would like or where the friction is. Like one of our customer’s feedback shown above.
From these types of feedback, you can easily create action plans and add them to your product roadmap.
Once you have improved your product and its offerings, you can contact the old customers and ask them to come back. Why not?
Havard Business School research showed e-commerce that successfully retained just 5% more customers can increase business profitability by 75%.
Collecting customer churn feedback can prove to be invaluable for the success of your product and your bottom line. It allows you to extend the lifetime of your customers and improve customer retention.
Here at Usersnap, by collecting churn feedback we learned what was missing in our product and mapped out new directions for development. We also started to think about asking for more customer feedback in different product development stages.
“We strongly believe we can add more value along the customer journey with feedback insights.”Haymo Meran, Head of Product at Usersnap
By embracing customer churn feedback, you and your company, like us, have the opportunity to create more value for your products and reduce overall churn rate.
How can you start collecting feedback? Talk to an expert and get a free demo today.
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