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3 Revenue Problems to Fix NOW A few different variables could play a role in those businesses shutting down. However, the primary, long- term reasons still boil down to the same three things I already noted: poor customer retention rates, poor to nonexistent upsell processes, and substandard lead conversion rates. Some businesses get past those hurdles initially but fail to sustain high rates and excellent policies over time, so they stop growing.
quickly as humanly possible to identify what’s wrong and try to get on top of a potential cancellation. Most people would rather keep doing business with you than find a new provider. If you listen to them, figure out their problem, and solve it (see Steps 3 and 4), you should be able to retain them. 3. Find out the real reason behind each cancellation. Most people will claim they’re canceling because they can’t afford to keep buying from you, but money is rarely the real reason. If they wanted your product or service badly enough, they would find the money to afford it! Here’s what I mean: Imagine I dropped you off in the middle of North America with nothing but the clothes on your back and a hundred bucks in your pocket. Then, I told you, “You have 48 hours to make it from here to Lithuania. You can’t contact any of your friends or family, and you have to fly first class. If you make it, I’ll give you $1 million.” Would you blow off the challenge because you “only have $100 and can’t afford a first-class plane ticket”? Of course not! You’d borrow the money or find someone rich enough to fly you across the ocean and split the $1 million with you. You’d put in the effort because you want that $1 million really badly. It’s the same situation with your clients. They’ll find the money if they really want to buy from you — and if they don’t find the money, that means something else is wrong. You need to figure out what that “something else” is. Start by asking your unhappy clients a question like this: “Hypothetically speaking, if money wasn’t a problem, are there any other issues keeping you from working with us?” That will help you get to the root cause. 4. Solve the unhappy customer’s problem to increase your odds of keeping them. Don’t get offended if a client points out a hole in your product or process. Instead, jump in and repair it! Maybe they’re not happy with your customer service, or they’re confused by your pricing. Those are relatively easy fixes that could save not only this customer but also hundreds of others down the line. 5. Follow up with a multichannel win-back or nurture campaign. Whether you save the customer or lose them, you need to follow up. Ideally, you should use a combination of emails, texts, phone calls, and direct mail (if they’re a high-value customer) to either nurture them and keep them happy or win back their business. Those marketing campaigns have to be as automated as humanly possible, which means you need to invest in a CRM system.
Even minor improvements to the above numbers can significantly impact the
health of your business and your profits. So, how can you make those improvements? I’ve spent the last dozen years
studying the subject, and here are a few of the strategies I’ve found that actually work.
My 5-Step Process for Retaining More Customers
If your customer retention rate isn’t great, you should employ a five-part strategy to bring it up. 1. Track your churn. Most small businesses don’t track their churn well because they’re unsure what to track. To do this effectively, you must determine how often your average customer does business with you. Is it every month? Every six months? There can be some variance here, so don’t be afraid to use a range. Once you figure out the interval, you can decide when a custom becomes “lost.” If people normally do business with you every 4–6 weeks, for example, you might not have to worry if a customer doesn’t show up by week seven. But if they’re still a no-show by week eight, you should consider them lost and follow up. (Remember, you may have outlier customers. You can create a separate “bucket” for them with a different follow-up interval.) 2. Be proactive about saving “lost” clients. If you’re tracking your churn and a client moves into the “lost” category, you should reach out to them as
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