Think customer attrition deserves less of your attention than customer attraction? Think again.
Much of any company’s focus is channeled into attracting new customers and procuring large and sustainable accounts. These are the fuel sources for successful growth. It makes sense to spend time and effort into maintaining these gateways and developing them as wide as possible. But in the meantime, retention is usually a secondary discussion – a priority mishap that can lead to customer attrition.
The last place you want to be is in a conference room full of executives, all discussing the sudden departure of some of your best customers. In order to avoid this, you need to be tuned in to the warning signs.
4 Factors that Can Influence Customer Attrition
1. Your rewards program targets new customers only.
Rewards and loyalty programs are a top-trending commodity that nearly every type of business has established. If your program gives cash-back, large discounts or giveaways to new customers, while providing much smaller rewards to long-term customers, you need to reevaluate. Yes, draw in the new fish, but keep the water sweet so he doesn’t jump the bowl. Loyalty programs should grow in strength in correlation with the customers’ loyalty.
2. There’s a lack of transparency to your customers.
With the growing popularity of reality shows and social media, people believe they have a right to see what’s happening behind the big curtain. Take time to share your work through media platforms, marketing, newsletters, blog posts and the like. This will add a level of authenticity to your brand. The big secrets don’t have to be revealed; instead, try to showcase the little things that help customers humanize your company while getting them excited and chatty about what’s next.
3. A weak online presence or interface can break the deal.
It’s likely that more than half of your clients are using their smartphones to access their accounts with you. When they log in, they need to be able to do nearly everything that they could do if they visited a branch or sat down face-to-face with you. For example, they need to have quick views of account balances, ability to deposit checks, access to reports, and complementing app and online or software capabilities. That means you can’t have an app that does 10 percent and a website that does another 60 percent. It all needs to be in one place. Offer periodic updates to fix bugs and give more of what the customer wants to see. Surveys, ratings and feedback of your online presence and an equipped tech team will keep this in check. Be sure to use the apps and website yourself.
4. A customer cancels or closes an account.
When a customer threatens to take business elsewhere, think of it as a cry for help. They want you to do something about their unhappiness. Are you able to have a conversation with the person about why they want to leave, and furthermore, are you able to make adjustments to keep their business? Even if a client does walk, have them take an exit survey or call them to follow up to understand where things went wrong. To prevent cancellations, keep an eye out for these additional warning signs:
- Lack of engagement. You can see how often (or not) a customer is logging in and using services, or how quickly the customer approaches benchmarks.
- Issue of complaint. If the customer is using your “help” services or seeking a further understanding of your services, initiate a line of communication and set follow-ups.
- Stacking up fees. If possible, set up a way to monitor the amount and frequency of fees a customer acquires. Fees are a nuisance to any account holder, and it will add frustration to the pot. Perhaps there is a better-suited account level or specific service features this client could benefit from in order to avoid accumulating fees.
Despite the things you can control, there is still an outer lying cyber threat: Financial institutions are slower to streamline the digital experience due to privacy and security issues. At the same time, the demand increases. Remind customers of safe online practices and consider boosting breach sensitivity to protect all current accounts.
A Voice of the Customer program, along with complementary resources to support superior service, is your first line of defense against customer attrition. Find out more about CSP’s customer experience management solutions.