Customer retention rate is an indicator of how your product keeps its customers over time. It is one of the most important metrics that shows the ‘stickiness’ of the product, and ultimately of how much potential it has. Often, product teams don’t give this indicator a proper attention, and to grow their sales they concentrate on attracting new users. But retaining customers costs less than acquiring them, and for your product growth it is the main factor. But how to deal with user churn?
The most important reasons for high churn rate are:
1. Lack of engagement: users who don’t use your product or visit your website frequently enough are likely to leave.
2. Product bugs: technical issues negatively impact users’ attitude to the product.
3. Difficult UX: complicated navigation and a poor interface frustrate and alienate your users.
4. Sometimes the content, that users engage with, and the descriptions of the products that users buy, are the reasons for higher churn rate.
To diagnose the problems, start tracking your customers’ activity. Make sure you complete the data audit and data source integration. The data collected will be the basis for churn analysis. Read more about creating and maintaining your Data Ecosystem.
To solve these problems effectively, use Niffler Churn Rate tools that employ machine learning and survival analysis to understand what makes users leave and which users are likely to churn in the near future.
Find out the main reasons for user churn based on the activity data. No matter how big your data is, these models will help you to better understand and predict user drop-off.
This knowledge allows you to optimise UX, plan communication and prioritise product features to keep the user.
Churn rate analysis helps you to increase revenue at little cost and determine the future development of your product.