Reason for Customer Churn

Reason for Customer Churn?

Shankar Kaliaperumal, talks about why customers leave you irrespective of your brand.

customer churn

Satisfied or delighted customers never leave a brand or company. Just take a look at yourself over the years as an end user, you might have used the same watch brand or shoes or car or phone or laptop. You might have moved to the next version of the same brand, but not switched over to another, why? You are either content or satisfied or delighted by the product/brand, in other words unless you have issues with a product/brand there wouldn’t be a reason to switch. Similarly now look at brands that you have switched over years, it could be a watch or insurance policy, etc. More than the new brand providing something new or additional, you might have faced an issue with the existing brand that was not dealt with properly.


While switching a brand or company, there are two decisions – one to quit the existing one and two to switch to another brand. It’s almost always quitting the existing one being the first decision taken prior to switching to new brand. When you switch jobs as well, first and foremost is why you don’t want to continue in the current company rather than switching to new company.

Similarly satisfied/delighted customer will never leave a vendor/service provider unless he/she has an issue with the existing product/service.

Avoiding Customer Churn

Customer churn could be avoided through simple steps like,

  • Communication – Listen to your customers
  • Pre-empt – Let’s face the reality, we all make mistakes and it’s bound to happen, how we handle is what would make the difference, i.e. instead of waiting for problem to occur in order to notify the client, lets pre-empt and inform the client ahead about the issue and the mitigation plan
  • Trust/Loyalty – We need to build trust and loyalty with client for long term relationship which can only happen through continuous engagement
  • Honest – Be honest and inform them things that you can’t deliver something on time or cases where you don’t have capability to deliver
  • Competition – They chose you after comparing with competitors, but are we regularly communicating with them regarding how we are still having an edge over the competitors or what we have planned in roadmap for having a competitive edge.

Receiving additional business from an existing client is far easier than convincing a new client. Executive team (which closes the deal with a client) should spend equal amount of time for both existing as well as new/prospective clients. It’s a mistake done by many companies where significant time of management team is spent on acquiring new clients and they lose the relationship with existing clients. Please remember that whoever/ whichever team was the face of the company while closing the deal should maintain cordial relationship and engagement with the existing client even though they might not be involved in day to day transactional activities.

We should never forget the fact that our salaries and other benefits are taken care due to our existing client base. Least any company can do is – to make sure to not lose a client due to internal issue.