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Customer Attrition and Retention

This Slideshare presentation is a partial preview of the full business document. To view and download the full document, please go here:
http://flevy.com/browse/business-document/customer-attrition-and-retention-1947

BENEFITS OF DOCUMENT

1. Identify customers who are leaving your company
2. Evaluate the root cause of attrition
3. Design program(s) to retain customers in B2B space

DOCUMENT DESCRIPTION

This document helps companies identify the root cause of attrition and take steps to address it. It also helps you analyze your customer experience and how you can design programs to reduce attrition. This powerpoint gives you ideas on what data to collect and analyze. It provides a framework to help you identify the root cause of the problem and design programs to reduce attrition

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Customer Attrition and Retention

  1. 1. CUSTOMER ATTRITION & RETENTION Vizible Results, Inc. © Vizible Results Inc
  2. 2. Attrition Analysis © Vizible Results Inc •Identify accounts lost •Conduct Exit Interviews for non-renewing customers •Match this information against CRM database •Gather Returns data – CRM or any other database •Gather negative Social Media mentions •Match all this information against Customer Satisfaction Data [CSAT and NPS] if possible *Collect Data •Objectively analyze the root cause into the following ways: •Price, Product, Delivery & Service •Customer Lifetime Value or Account size [High, Medium, Low] •Customer Linkage Analysis** Analyze Data •Using the information from your analysis: •Design Customer Retention programs based on your attrition analysis Design Programs *If you want to go one step further in data analysis, also analyze accounts that sales did not win ** Walk in the steps of your customer as they onboard your company This document is a partial preview. Full document download can be found on Flevy: http://flevy.com/browse/document/customer-attrition-and-retention-1947
  3. 3. Customer Service Data [CRM] © Vizible Results Inc As Customer Service is the first line of defense, all these 6 Key Performance indicators are important in managing customer experience. • Number of calls made by the customer • Were any of these calls escalated to the next level? • How many calls were not resolved right away? • What did customer satisfaction survey say? Were there any warning signs? • How many times did we meet our Service Level Agreement? • On an average, how long did it take for us to resolve the customer issue? This document is a partial preview. Full document download can be found on Flevy: http://flevy.com/browse/document/customer-attrition-and-retention-1947
  4. 4. CUSTOMER DATA ANALYSIS This document is a partial preview. Full document download can be found on Flevy: http://flevy.com/browse/document/customer-attrition-and-retention-1947
  5. 5. Segment Customer Attrition data based on CLV or Account size Attrition of customers with Low CLV/Revenue Attrition of customers with Medium CLV/Revenue Attrition of customers with High CLV/Revenue 1. Segment data into 3 buckets based on Customer Lifetime Value or Account size 2. Create heat map of root causes for each of the 3 segments 3. Try to understand the root cause for the customers with high CLV/Revenue first as they usually spend more money with your company. © Vizible Results Inc This document is a partial preview. Full document download can be found on Flevy: http://flevy.com/browse/document/customer-attrition-and-retention-1947
  6. 6. Applying Customer Attrition Insights • Using the analysis you have conducted on customer attrition, it is now time to apply this information to your current customer base. • In the next section, you will now use these insights to design programs to retain customers at risk by prioritizing what issues need to be tackled first. This document is a partial preview. Full document download can be found on Flevy: http://flevy.com/browse/document/customer-attrition-and-retention-1947
  7. 7. Retention Program © Vizible Results Inc • Going back to our root cause of customer attrition, we need to design programs around each of those reasons. These programs are mostly cross-functional in nature. • Typically Customer Service is the catch all for all service, product, delivery and pricing issues. • The following slides will go into depth on each of these root causes. • Using the data you have gathered on non-renewals, returns etc. identify customers who are at Flight Risk by designing an “Early Warning System” • Not all customers are equal. When customers call in into the call center, they should be given treatment according to their wallet spend with your company. Design a Case weighting system which will put certain customers in front of queue for both call handling as well resolution. This document is a partial preview. Full document download can be found on Flevy: http://flevy.com/browse/document/customer-attrition-and-retention-1947
  8. 8. SERVICE ISSUES This document is a partial preview. Full document download can be found on Flevy: http://flevy.com/browse/document/customer-attrition-and-retention-1947
  9. 9. 2. Omni Channel Experience • Companies are always looking for ways to reduce cost of service. Cheaper services include Chats, Forums, a good FAQ database that can be viewed on mobile etc. • As a result, customers have various ways to get in touch with the company. In order to have good customer service experience, customers should be able to use any channel to get in touch with the company for any kind of problem. The onus is on the company to identify the nature of the problem and have a faster resolution pending the channel and complexity of issue at hand. • For example, a customer may call in via chat for a complex issue. It is up to customer representative to understand that the issue cannot be resolved on chat and to transfer the customer to a call center where more knowledgeable representatives are sitting, in order to get the issue resolved. © Vizible Results Inc This document is a partial preview. Full document download can be found on Flevy: http://flevy.com/browse/document/customer-attrition-and-retention-1947
  10. 10. Product Features • Does your product lack some features? The marketing department should be regularly making the assessment of the external environment to understand what features are being offered by competitors. They should work with Engineering or R&D to prioritize the releases of these new features. • Information should also be gleaned from the Returns database to understand if customers are favoring other competitor’s product due to certain features. This information should be shared with Marketing. © Vizible Results Inc This document is a partial preview. Full document download can be found on Flevy: http://flevy.com/browse/document/customer-attrition-and-retention-1947
  11. 11. PRICING This document is a partial preview. Full document download can be found on Flevy: http://flevy.com/browse/document/customer-attrition-and-retention-1947
  12. 12. © Vizible Results Inc Customer Lifetime Value As customers are viewed as assets of the firm, companies use different strategies to : attract new customers, extract maximum value from customers and retain customers. This metric is the Net Present Value a customer brings to a company, over a period of time, when he or she buys goods or services from a company. It is a discounted sum of future cash flows. There are many ways of calculating CLV, however in it’s simplest form – CLV is measured as: CLV = (Annual Profit Contribution per customer * Average Number of Years they remain as customer) – Initial Cost of Customer AcquisitionThis document is a partial preview. Full document download can be found on Flevy: http://flevy.com/browse/document/customer-attrition-and-retention-1947
  13. 13. 1 Flevy (www.flevy.com) is the marketplace for premium documents. These documents can range from Business Frameworks to Financial Models to PowerPoint Templates. Flevy was founded under the principle that companies waste a lot of time and money recreating the same foundational business documents. Our vision is for Flevy to become a comprehensive knowledge base of business documents. All organizations, from startups to large enterprises, can use Flevy— whether it's to jumpstart projects, to find reference or comparison materials, or just to learn. Contact Us Please contact us with any questions you may have about our company. • General Inquiries support@flevy.com • Media/PR press@flevy.com • Billing billing@flevy.com

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