How to Bring Down Customer Churn

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Pleasing all your customers at all times can seem like an arduous task since your time, money, and energy are spent on order replenishment, training, and guiding your employees for superior customer service. And this can lead to a high customer churn, leading to increased costs affecting your bottom line. 

Tracking data can help you improve your customer retention strategy. What can also help is knowing where customers drop off in your sales funnel, leading to customer churn.

To understand customer churn for your business, first, assess what causes it. How do you deal with such customers, especially when they are unhappy with the quality of service? Identify any service inconsistencies that lead customers to switch to other service providers. And if your services are relatively consistent, look at your competitors or other salons to see if there are better offers elsewhere that promise superior services.

And if regular customers are opting out of your services, then re-look at your customer journey to identify a new customer segment or a new offering that can lead to customer retention.

But first, let’s get to know the reasons for customer churn.

Why You Get Customer Churn 

Often there are telltale signs that customers aren’t happy with your services, either through complaints or comparison with other salons. And this translates into customers wanting more than what you can offer. 

While you can’t change your services for every customer, you can ensure consistency in service based on customer preferences. 

Customer churn can be tracked by looking at operational data with these clients – fewer visits, fewer repeat purchases, and a tendency to stop using your salon services. 

Track your top ten percent of such revenue contributors to control churn with this customer segment. Another reason for churn is when the loyal clientele is put off with poor customer experience and inconsistent service due to frequent staff changes at your salon, prompting a switch to other providers.

New entrants provide better offers at a highly discounted price. This makes it difficult to match similar customer expectations from your business. Alternatively, customers want to feel valued along with great offers that save them money. The absence of this makes them look elsewhere, putting your cash flow under pressure.

If you’re facing high employee attrition and disgruntled customers, you can realign your business with a few steps to get your business on track. And if competition is causing a slump in your business, then reevaluate what makes them sought after, even with your long-time customers. Losing customers can affect your business goals. Refocusing on a new customer segment can get your business on course. 

Dealing with unhappy customers 

At the onset, look at customers who are unhappy with your service. After each service, ask them to rate your service. Let the business owner call unhappy customers personally to understand what went wrong and how it can be fixed.

It could be a service issue that can be addressed with a few tweaks in your process of a long-term commitment to excellent service or service gone wrong. For poor service experience, step in and offer monetary discount or refund to make up for it wherever applicable for long-term customers.

For recurring customers with issues, ensure you document your service, the complaint, and the action taken to reduce future issues. This way, you’re safeguarding your salon from incidents that can affect your brand image.

Such complaints can then be used to create a training manual in your salon for better service, reducing customer churn.

Training can also address inconsistencies in your service that are often difficult to track. Frequently interacting with your employees is a step in the right direction to keep your customers coming back.

Inconsistency with service 

Salon clients come into a salon with certain expectations. The presence of a safe and welcoming environment is one among others. Value-add for their time and money is another reason they keep using the salon of their choice. Because they prefer a specific service, make sure your employees are well-prepared to meet these expectations.

First, start by keeping your employees loyal and happy. Address any unresolved issues with existing employees and maintain an onboarding process for new hires. Have an onboarding process that includes all your service checkpoints. Also, ensure you train them routinely. This way, they know the best practices while dealing with clients.

Make sure you use past customer reviews to schedule them with the right provider automatically. This way, there is less chance of a dip in service quality. Also, consider their previous feedback while offering the service.

Look for ways to improve your client satisfaction rating by providing better up-sells, cross-sells, or offers as competitive as those in the market.

Better Offers Elsewhere

You may have an evenly priced service that gives you good returns. But often, it may fall short of surpassing your goals to make it profitable. Your competitors could provide better offers, services, or access to exclusive salon services at a premium price. To compete with this, try some of these strategies:

Track your competitor offerings: Subscribe to your competitor’s email newsletters and track their promos. Study their frequency and how it could work in your scenario. Then create a plan of action to offer similar promos to your customers.

Offer similar promos: If you see a higher frequency of promo offers in the emails, you know the promos are gaining traction. Consider implementing such promos for your customers and assessing their performance with a select set of customers or a particular segment that wants promos. It can give you quick sales and minimize churn.

Use combo services: Buyers typically look at the perceived value of a product or service. Combos and free add-ons increase the value of your offer and deliver exceptional value without adding to your cost. It creates a positive perception and high recall value that improves customer loyalty, thus reducing churn.

Referrals: Consider adding referrals to your list. Reward customers, so they bring in more people. This way, even if you have churn, the referrals will help maintain a continuous momentum of clients fulfilling your long-term need to secure clients.

Collaborate: Collaborating with other businesses gives you access to borrowed audiences. It provides access to a new audience to pitch your services and widen your reach with the same services or products, reducing the need to offer new products to your existing customers.

Customers who don’t need your service anymore 

When customers stop using your services, check your data to know why. Adjust your customer acquisition strategy so you’re tailoring your offerings to the clients that need your services. 

Look at your customer lifecycle: Understand your customer lifetime value. Look at the various touchpoints in your service where customers stop using them. Is it in your low-tier services or premium services? Do they stop using your service because of a specific price point or an absence of a service? Establish the reason for opting out of your service. Recognize the pattern from this study and then plan your next step.

Identify patterns: If there are recurring patterns across customers, you can reposition your service to attract them. For example, if you have a teen audience, you could switch when they are older. Would you be able to offer a specialized service catering to your ageing audience??

Scope of your offerings: Alternatively, look at your offerings and try going up the value chain – possibly white labelling products you can continue to sell to your clientele even if they are not visiting your store. Also, look at getting such customers back by personalizing your offers to make them feel valued and welcome to return to your salon.

Recurring customer acquisition strategy: Also, find a customer acquisition strategy – either SEO or social media so that you can grow your website traffic and constantly fill the churn with new customers. For a long-term strategy, SEO can benefit you. To gain customers quickly and reduce churn, integrate social media as a part of your customer acquisition.

Final Thoughts on Reducing Customer Churn

Every business faces customer churn. It’s what you do in case of such a scenario that decides the direction of your business. First, understand the reason for churn in your business and why customers are unhappy with your services. Check out reviews and gauge the first few signs when it seems to go downhill with a client. 

Next, understand if any service gaps cause friction in your business, address them with employee training, and reach out to the client to sort it. Instil some good practices like tracking competitor offers and creating exciting offers for your customers. Look to increase your services’ value, so they make a positive perception of your services. 

And even after these steps, if you have churn, re-look at your customer acquisition strategy and identify touchpoints where customers switch to a different salon. Target a new segment and adapt your service to a new audience with more benefits. Ultimately, it is about finding a customer acquisition strategy that suits your short- or long-term business goals and reduces customer churn.