Churn rate is the rate at which customers stop doing business with an entity. It can be expressed as the percentage of users that discontinue their subscriptions with a given time period. It can also be expressed as the rate at which employees leave a company. To experience growth in a company, the growth rate should be higher than the churn rate.
- Provide clarity on the quality of the business - The churn rate of a company indicates how well it is able to retain its customers which reflects the quality of service provided by the company.
- Indicates the likes and dislikes of the customers - A higher churn rate indicates that the customers might not be liking your product or service. By getting clear stats you can re-work the strategy and quality of products.
- Possible fixes - As you dig deep into why your customers are leaving, you can implement better ways to fix the business problems and retain your customers.
What causes churn?
Now there are a variety of reasons that might trigger the user to end the subscription with your site. But some common sources of churn include -
- Lack of features
- High cost
- Poor onboarding experience
- Poor user experience
- Competitors offering better products
- Poor product or service
Tips to decrease the churn rate
- Leverage push notifications - Sending notifications to the users every now and then helps to keep them interested in the content which leads to better engagement and repeated visits.
- Personalize - Personalizing the experience for each and every user makes them feel as if you are talking to them. You can customize the interactions using their first name and preferences.
- Make use of the in-app messages - Send the right message at exactly the right time and help the new users to explore all your features.
- Optimize the user experience - Make their experience worth a while by using catchy content, videos, and great quality in the case of products. Make everything look attractive and interesting.