Customer Churn

Customer churn means your customers are unsatisfied in some way. Usually, this discontent comes from collapses in customer experience. Identifying what is causing collapses in customer experience is key to reducing customer churn and increasing your revenue.

“Listening offers data. Hearing offers empathy and intelligence. Activity, acting, and engagement steer perspective and encourage a sense of community and advocacy.”
BRIAN SOLIS

Social Customer Experience Reduces Customer Churn

Just because customer churn is always going to be there doesn’t mean your business can’t get it as low as possible so revenue will increase. To do that, a company must focus on solving six smaller problems that all feed into customer attrition. 

Before going into the four subproblems, let’s discuss why customer churn can rise to uncomfortable levels all too often. Ultimately, it comes down to one factor: customers feeling valued. Not just satisfied. Valued. 

A satisfied customer is the one who gets off the phone with a customer service representative or purchases a product that has no issues and walks away with a smile on their face. While this kind of customer satisfaction is rightly sought after by companies, it will not ensure they are loyal to the company or customer churn reduction. Only a valued customer will demonstrate consistent loyalty and lessen customer attrition.

Ease of Use and Presentation

In June of 2007, Apple announced the release of the first iPhone. While the iPhones were revolutionary in and of themselves, there are two factors that keep their customers coming back for the next model whether they know it or not: ease of use and presentation.

The iPhone was one of the first to offer the simplistic, minimalist full screen phone with only a single button on the face. Once turned on, the phone was easy to navigate and could be customized to a customer’s liking. It was also one of the first phones to offer digital maps and destination assistance as we know it today. Everything about the phone was and is designed for ease and simplicity. After blocky cell phones and number pad texting, iPhones were readily accepted by the general public and still are.

Additionally, Apple’s presentation of the iPhone is still one of the best packaging examples of today. From the simple box to the white colors to the iPhone seemingly floating above it’s packaging, Apple provides a superior sensory experience. 

Sensory Experience

Alessandra Ruggeri explained, “‘Sensory experience’ might not be the first thing we have in mind when we think of Marketing strategy. Yet it is the first experience customers have with your product: how the package looks. Packaging can indeed be just as important as the item it contains. The sensory experience continues as they touch it and look at the images and text. The label may help customers decide whether to buy it or not, but if the packing doesn’t engage them, chances are that they aren’t going to buy it.”

The ease of use with iPhones answered a customer's needs many didn’t think could be solved at the time, and getting what they needed through such a sensory experience just made it all the better. Many recognized that Apple’s effort to go above and beyond with packaging and presentation was an effort to please and delight customers. And it worked. Apple’s customers felt and still feel valued with every purchase and update.

Creating this value is the culmination of efforts aimed at providing high-caliber customer experience. Customer experience is the difference between customer satisfaction and customer significance or value. It is what provides customers with the sense of valuation from a business and their efforts. 


Social Customer Experience

In this era of social media, customer experience extends beyond packaging or an upbeat customer service representative. While those things are still important and should not be undervalued, a company's presentation and services must be of equal caliber, if not more, on social media. Social customer experience is about presenting your company positively online just as you would in a physical location. In fact, many customers will go to social channels to observe or contact a business today rather than call.

With the social customer experience in mind, let’s jump into the four subproblems.

SUBPROBLEM 1

Low Customer Lifetime Value

Customer Lifetime Value (CLV)

It almost goes without saying, but when customer attrition is high, customer lifetime value (CLV) is low. When relationships with customers tend to last through only a single purchase, it’s expected that the net profit attributed to that customer would be low. 

Low CLV could be attributed to many factors such as unsatisfactory products, a negative experience with customer service, or a poorly written advertisement. The only way to truly know what factor or factors are causing low CLV is to perform market research. However, there are two commonalities that companies nearly always find are the root of the problem: lacking social customer experience and poor online presence.

Luckily, the solutions to both are fairly similar. 

Sentiment scale

Improving Social Customer Experience

One of the best ways to improve social customer experience and online presence is to be aware of your audience’s sentiment and needs with real-time social insights. With those insights, you will be better aware of customer concerns and better enabled to reply to voiced concerns quickly. You will be able to track their sentiment and know if a crisis is starting to show its colors. 

As social listening provides you with needed insights, your company will identify the right topics and tone for content that resonates with your customers and will motivate them to share and promote your brand. And to further motivate them, engage with them. Talk genuinely with them through comments and social posts. As they come to know you, they’ll trust you more and be much more willing to send friends and family your way. This kind of positive activity and interaction between a business and its customers on social media will generate loyalty in current customers and attract potential customers.

Case Study: Hertz

From Poor Reputation to Receiving a Shorty Award for Social Customer Service

The Opportunity

Several years ago, Hertz was struggling to maintain a positive online reputation. The problem was their 1-800 customer service only operated Monday through Friday, and they didn’t answer questions received over social media. This meant that weekend travelers could not reach any form of live customer service. This was extremely surprising and upsetting for many Hertz Rental Car customers who expected the global travel mega-company to have customer service available in their time of distress, such as if the car broke down, if they were attempting to figure out how to drop off their car at a closed rental office on a weekend, or if they had a dispute with a local Hertz office about the availability of their reserved rental car.

What their audience expects

My messages will be responded to

A response within 30 minutes

24/7 Customer Service

Social responses across multiple channels

What Hertz was delivering

Average wait time was 5 hr 32 min

No service on the weekend

Equipped to handle only FB and Twitter

Only 32% of all messages were addressed. 24 million total customer interactions. 16,320,000 were not being addressed.

The Solution

Hertz customers were unable to make their customer feel successful due to stained or unavailable communication channels. This lead to customers becoming increasingly frustrated.

Hertz solved their customer experience issue by implementing social customer experience strategies with Nuvi’s tools. Hertz was empowered to listen to their audience in powerful ways across social, to organize the issues arising through the use of tags and notifications, and to implement solutions to engage with those issues.

As they began to fix their processes, they were able to create positive touch points that turned many customers into advocates.

CUSTOMER REACTIONS

A Run-in With a Comedian

In 2017, Comedian Sarah Colonna tweeted about how there were no available rentals when she arrived to pick up her car in Atlanta. Hertz’s engagement team, with our real-time software, was able to reverse a negative into a positive and ultimately turn Sarah into a brand ambassador.

A few months before Sarah’s experience, Hertz was also able to improve their online reputation during Hurricane Harvey.

During the crisis of Hurricane Harvey in Houston, Twitter proved to be the best means of communication for disaster relief. The Hertz Corporation was able to assist customers effectively by bringing in the fleet to help responders and victims with transport needs. Hertz also used the Nuvi platform to connect with influencers who were traveling to Houston for relief efforts.

CUSTOMER REACTIONS

Hurricane Heros

Influencer Stef Michaels, known to her millions of social followers as @adventuregirl, noticed that Hertz was actively using Twitter to engage with citizens. Stef was heading to Houston with over 1,000 dog food bags for displaced animals. She tweeted @hertz to partner on this important journey. Hertz provided Stef with a SUV to transport the food to shelters, leading to increased engagement, reach, and positive sentiment.

Similarly, Heath Hussar, an influencer with nearly 600,000 followers on Twitter, tweeted that his pickup truck was stolen. The Hertz customer care team intercepted his tweet and hooked Heath up with a pickup truck rental. His followers jumped in on the conversation and created the hashtag #HertzToTheRescue, which tremendously increased Hertz's reach and positive sentiment.

The Results Were Amazing.

• Decreased negative sentiment 24% vs. the previous year
• 74% increase in incoming messages
• Converted half of concerned customers to promoters
• Increased service levels by 67%
• Saved $3.5 million in the first year after investing in social customer care
• Awarded a Shorty Award for Best-in-Class Social Customer Care



So, what loyalty behaviors did Hertz seek to develop? Their efforts point towards the goals of generating word of mouth and increasing customer trust in them. Achieving the Shorty Award says that many thought their efforts successful. And the fact that negative sentiment decreased by 24% means their online reputation management strategy was working.

Products are made in the factory, but brands are created in the mind
Walter landor
SUBPROBLEM 2

Negative Press Management

Sentiment scale

Social Customer Experience Strategy

Yet, despite how solid a social customer experience strategy might be, nothing is perfect. There will be collapses in customer experience. There will be an advertisement worded wrong, and there will be porch thieves or bad weather. Whether or not a company is at fault or not, collapses in customer experience that lead to customer churn happen all the time. When they occur, companies need a strategy for recovering customers.

The first and best way to ensure customer recovery and even a decrease in customer churn is to create a social customer experience strategy that strengthens customer trust in you before a crisis. If businesses can do that, they will have a lot less work to do when a collapse or even a crisis occurs because those customers will be much more likely to stick around.

Social Data

Another way to prevent a crisis is to see it rising and get ahead of it. With social listening, companies can see rises in negative sentiment and even set alerts when that sentiment gets too high. Diving into the social data, businesses can identify the cause and address it. Quickly addressing the issue will likely stop it from growing into a full blown crisis and will likely inspire customers to come to your aid as you share your side of the story. By engaging and resolving problems online, a company will build and regain trust through effective communication.

As you build trust with your customers, you’ll create and discover brand advocates and influencers that can assist you during a crisis. They can inform you of their perception of customer concerns and help you push out messaging that aid in rectifying the crisis.

We understand and empathize with how hard a crisis can be, however, your company must keep their audience at top priority. You must understand who’s been affected (including your employees), why and where you can reach them. Define your stance with these insights and act.

As you utilize social listening, influencers, and advocates, along with keeping your audience at the forefront of your efforts, you'll see a decrease in customer churn and quicker resolutions to crises.

SUBPROBLEM 3

Slow Social Media Response Time

Dive into Target Customer Behavior

Sometimes with all a company or team has to do, social media can be overlooked. But 70-80% of people who research companies before going to the physical location or purchasing do so on social media. And since they spend their time there, that is where they’re often most comfortable reaching out to companies to ask questions. The same is also true for current customers.

And when customers ask questions on social media, they expect a response quickly. Unfortunately, responding quickly is more difficult the more social media accounts you have. Luckily most platforms will notify you when you're DMed or someone comments on your post, but things get missed.

Enterprise Monitoring

Failure to respond quickly can hurt your online reputation and be a pain point in social customer experience. By responding quickly, companies can improve retention by solving customer problems when they need them solved. Again, customer attrition is the result of customers feeling undervalued. When their problems are managed quickly with optimal service quality, they will feel valued.

In order to make sure nothing is missed, Nuvi Engage allows companies to manage all customer messages and responses from multiple platforms in one place. With all your social platform activity in one place, social media managers can monitor and manage replies by assigning members of their team to answer various questions or concerns. This is especially helpful during a crisis when a company may be receiving more customer outreach.

SUBPROBLEM 4

Lack of Customer Knowledge

Sentiment analysis

Social Listening

As we’ve shown, customer attrition is linked to a customer’s perception of their own valuation to a company. In order to do that, companies need to understand their customers. They need to know how customers interact with their products, what needs aren’t being met, and what they don’t know they need or want.

With this knowledge, companies can enact strategies that allow them to surprise and delight customers, like Apple did. But your company’s strategy will be unique because it is designed for your unique audience.

Social listening will enable companies to learn what they need to. Social listening allows companies to gain unsolicited feedback from customers by monitoring all conversations around your brand, whether you’re tagging the conversation or not. Monitoring competitors in this way is also beneficial to learning more about your customers as you’ll be better able to determine your share of voice and position in the market.

Streamlined social media workflow

Create Together

But learning all this isn’t going to worth anything unless it’s used. The tricky part is being consistent with what you’ve learned. But luckily teams can help there. They can work together to create, monitor, manage and publish content. This can be easily managed with Nuvi Plan and Publish. This Kanban-style workflow and calendar allows everyone involved on a project to see where it is in the process and what needs to be done. As your teams work together, with the customer in mind, they will produce content and create touch points that resonate with your audience.

Dive into Target Customer Behavior

Additionally, companies need to engage with customers. With social listening, you can find conversations about your brand that you aren’t tagged in. Jump into those conversations and let them know that you want to be involved in the entire customer journey, not just the point of purchase. Engaging positively with customers at every opportunity will promote more advocacy and loyalty.

Create an Online Presence Customers will be Proud to Associate with

Lastly, customers' sentiment and needs are always shifting, and so your strategies must as well. With real-time social listening data and Nuvi Analyze, you can observe these changes as they happen and strategize immediately. With Nuvi’s tools, you can stay relevant and consistent in your efforts to connect with your customers and reduce customer churn.

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