The best way to understand churn rate is as a bellwether. In practice, that means when you look at churn rate, what you’re looking for are clues as to what’s happening with your customers and product. Armed with that knowledge, your team can leap into action to address anything that’s impacting churn rate.
A high churn rate is a problem; but by using intelligent process experience software, your team can leap into action to address anything that’s impacting it and reduce churn rate.
Churn rate is a measure of how many customers reduce or stop doing business with a company over a given period of time. Understanding the rate at which your customers leave is essential to evaluating the effectiveness of your RevOps efforts. Generally, a lower churn rate indicates a higher level of overall satisfaction among your customers.
The best way to understand churn rate is as a bellwether. In practice, that means when you look at churn rate, what you’re looking for are clues as to what’s happening with your customers and product. Armed with that knowledge, your team can leap into action to address anything that’s impacting it.
You need to have a benchmark to aim for, or else you won’t have a sense of how your rates are trending. Decide on a reasonable percentage as a baseline and constantly drive towards it. You’ll know your efforts are effective when you meet or drop below that range.
There’s no hard and fast rule about what an optimal rate looks like, either, but about 5-8% annual churn is within a reasonable range. If you’re creeping up to 10% customer churn, that’s cause for some concern. Monthly churn should be much lower—around 1-2%.
Tonkean is a process experience platform that can centralize data from your various systems so you have a clearer view into what’s happening and can take action. It’s fully customizable by internal teams, so you won’t be slowed down by the need to rely on IT or dev teams to get started and create and customize your workflows.
The issues that impact churn rates are typically not mysterious, but you do need to know where to look to uncover and identify them. Effectively tracking churn requires examining lots of related metrics that, taken together, can provide a more accurate picture of what you need to address.
Additionally, disruptions common to any business—new hires or departing employees, contract changes, and so on—can impact rates, so factor those into your evaluations.
Tonkean lets you track everything you create in dashboards or team portals. These include who’s completed which tasks, which step a task is on, what’s already been completed and by whom, and what’s still needed.
You need strong communication and data-sharing across multiple teams, including sales, marketing, finance, customer success, customer support, and product R&D. Churn rates are affected by any number of factors that touch on one or more of those domains, depending on the specific situation or customer.
As a process experience platform, Tonkean makes it easy to communicate and share data across all the apps your teams use. Tonkean serves as the heart of your tech stack because every other application, tool, and software can work through it.
When you automate processes and communications through Tonkean, people can ask questions and get notifications and reminders in whatever apps they already use, like Slack, Teams, and email. Tonkean connects with data sources people throughout an organization use, too, like Drive and Salesforce.
If you’re tracking multiple metrics and have seamless communication between teams, you’ll be able to see potential churn coming before it significantly impacts your bottom line.
Tonkean is perfect for this sort of critical tracking. Using its no-code software, you can easily set reminders and automatically notify the right parties when they need to engage with a task–like contacting a customer about a subscription renewal–or automatically triage alerts so the necessary people in an organization get looped in at the right time.
Fortunately, a changing churn rate and its causes are typically not complex. For the most part, it boils down to how happy your customers are with your company and whether or not your product is working for them. If you have a modicum of usage data available and strong communication across teams, common sense and action-oriented responses to problems will ensure low churn rates.