Our understanding of how our customers interact with us has grown massively thanks to the prevalence of transactional data from websites, emails, loyalty cards and other touchpoints. Yet despite this, often the reason customers stop shopping with brands is unclear. It’s something that they may only realise weeks or months after-the-fact and may never get a concrete reason as to what made them leave.

Having the right insight is crucial in identifying customers at risk of churn, employing strategies to prevent this and in better understanding our relationship with our customers as a whole.

Incorporate more feedback

Most online/ongoing services have incorporated some form of feedback into their cancellation process. This often takes the form of a checkbox why the customer is leaving and a comment box for further notes. While any information at this stage can be vitally important, there will always be a portion of users who will click randomly in order to get through the process as fast as possible.

If brands want to increase their chances of getting reliable feedback, its important they start a dialogue with their customers from day one and collect information around their motivations and expectations throughout their journey. Find ways to integrate research in non-invasive ways at regular intervals. It is rarely one single thing that causes a customer to leave, but rather an accumulation of poor experiences over time. (An incorrect bill, having to contact support over a simple issue etc) Also consider the key questions you’re asking. For example, you might collect feedback after someone has contacted support about their call. They might be happy with the call itself, but may have been annoyed that they needed to call support in the first place and their problem was not more easily solved.

Contextualise consumer behaviour

When customers are leaving its easy to take it personally. Many brands will be quick to internalise customer churn by asking themselves what they did wrong, and how can they improve. Just as many will be dismissive and claim that the problem lies not with their business but in the unrealistic expectations of the customer. Often, there is a little bit of truth in both. Whilst we have already established the difficulty in applying a ‘Standard Churn Rate’ to any industry, without understanding how customers perceive your business in relation to others, it can be easy to focus purely on short-term measures that look to address specific complaints instead of larger issues surrounding your offering.

For example: If you were running a restaurant and noticed a rise in complaints about service, you might spend time/effort/money training staff on how to interact to customers, but still encounter a high level of churn. The problem may not be in your service levels but in the customer expectations. If you are positioning yourself as a mid-market family diner and customers perceive you as a fast-food, low price restaurant, then no matter how much you improve your service, it’s unlikely you’ll be able to match this perception and so the problem lies in your branding.

Understanding the perception of your brand within the context of your competition is key to uncovering the core motivations that bring people into your category.

Understand their core values

When you can contextualise the needs and desires of your customers, it becomes much easier to tailor activity around both acquisition and retention. While events like the pandemic caused significant disruption to most brand’s target markets, the needs and motivations of customers will not have seen a significant change and so by focusing on this as a starting point, you can better understand why customers might be leaving.