Did you know that the world’s top companies lose $1.6 trillion annually due to Customer Churn or Customer Attrition? Customer Churn, Customer Attrition, or what is also known as Customer Turnover is a frustrating issue for any business organization. It occurs when the customer stops using the service. At the same time, it is a great opportunity to improve operations because service providers can find out why a customer has left or stopped using the service. This process is called Customer Attrition Analysis or Customer Churn Analysis.
One of the most common methods for analyzing Customer Attrition in the customer satisfaction measurement process is the use of the Customer Churn survey and questionnaire. Furthermore, collecting data using the Customer Churn survey template is the first step in data mining in industries such as banks, insurance, software services (SaaS), and mobile operators.
How to Calculate Customer Turnover Rate?
Customer Attrition Rate means the percentage of the number of customers left this month to the number of customers you had at the beginning of the month. It refers to the number of customers that the company has lost this month. For example, suppose that at the beginning of this month, you had 250 customers, 14 of them left, so you now have 236 customers and so your Customer Churn Rate is 14 divided by 250 and then multiplied by 100, resulting in a 6.5% monthly churn rate.
You should always have two-way communication channels with the customers. Before customer turnover happens, conduct a customer satisfaction survey to identify those customers who are at risk of churning and take immediate action to ensure their satisfaction.
There is no perfect value for the churn rate. As these rates vary in different industries and cannot be compared with each other accurately in order to determine a basic standard. As well, it is recommended that the organization takes into account the customer churn rate as a standard and continually plan and takes action to improve it based on customer turnover analysis.
How to create a Customer Churn Survey?
To create a customer churn survey, you can use the ready-made customer churn survey form on the Porsline dashboard and modify it according to your needs. You can also create your own survey in the following steps:
- Start a customer attrition survey with a welcome page or an unanswered text.
- Add a 0-10 linear scale question or evaluation question and ask the user or customer to rate their overall experience.
This question makes it quick and easy to see if you are dealing with a satisfied or dissatisfied customer. Use the «Calculations» feature and select a score for each selection as shown in the image below. Later we will explain why the «Calculations» feature is used.
- The most important part of the Customer Attrition Survey is the question about the primary cause of Customer Churn. We suggest that you use a multiple-choice question similar to the image below and end up with an “Others” option. Options should vary depending on the type and nature of each business.
- By choosing each option, the customer should see the follow-up question related to this option. Planning to improve Customer Turnover Rate begins with answering this question. In this step use the «Add logic» feature to configure how the next related question is displayed.
- Finally, choose the Ending page that will be displayed for each selected group of customers by customizing the Ending Page and using the «Add logic» feature based on the calculations you have made for the question in step 2.
- For someone who is analyzing customer data from the Customer Churn Survey, it is important to know which customer answered the questions. So by using the «Custom Variables» feature, pass customer information such as name, customer number, service type, and other existing systems – such as the enterprise customer relationship management (CRM) system – to the Customer Churn Survey link.
- Finally, in analyzing the Customer Attrition Survey data, use the ability of “Advanced Filters” and “Report Builder” so that you can accurately study only the part of the collected data that matters to you.
Customer Churn Analysis is an ongoing process. Unlike some types of customer surveys that are conducted annually, monthly, or quarterly, this type of customer survey should always be performed.
Using Porsline’s API, you can, if necessary, recombine the data collected with the enterprise customer relationship management (CRM) system. In addition, CRM system should intelligently identify lost customers and send them a Customer Churn Survey link by email or SMS.