customer retention

Preventing Customer Churn: how to identify and fix red flags

4 min read Francisca Cordeiro, Head of Customer Success

In this article, we will look at the top five red flags that can lead to customer churn. For each of these red flags, we will share practical tips that customer success managers can use to mitigate them, as well as valuable insights on how to combat churn throughout the entire customer journey.

The fight against Customer Churn is one of the top focuses in any company, especially within the customer care teams. It’s easy to understand why: according to ChurnZero, acquiring new customers costs 6x more than to keep current ones. And, according to Bain and Company Service Insights, a mere 5% increase in customer retention can increase a company’s profitability by 75%.

Before we jump into the five red flags, it is important to understand that clients can leave for any number of reasons. Some will leave immediately after one bad experience; others will give your company the benefit of the doubt and a second or even a third chance at making them happy. While people’s loyalty to any given brand may differ, one thing is certain: people leave when they don’t feel valued and appreciated.


Top five red flags that might lead to customer churn

1. Change in PoC [point of contact]

When your usual PoC on the customer side changes (whether to another company or another position) there is a very high risk that your relationship with the customer will take a hit. The transition may not be done right, the new contact may not like or see the value of your product or wants to change, the engagement level with your brand will likely be much lower, and so on.

2. Reduced usage

When you look at usage stats and usability complaints, a low level of engagement and a high number of issues reported are both clear indicators that things are not going well.

3. Low satisfaction

What does your customer CSAT say? Are your NPR scores higher than 7? Has your number of incoming helpdesk tickets increased? A drop in customer satisfaction is an obvious red flag, and so is a spike in support needs. So, make sure to keep a close eye on these stats and in your Customer Success team’s feedback regarding customers they may be feeling unhappy.

4. Disengaged stakeholders

Do your clients avoid answering your calls and your emails? Do they cancel their meetings with you or your reps? This might be a sign their emotional attachment is decreasing on par with their satisfaction.

5. Lack of product knowledge and a shortage of learning materials

Is it clear that your customers are struggling to use your product or service? Can you tell they don’t know how to find the resources they need to be successful and independent? Do your customers know all about your features and how they can use them in their job? If your customers don’t know how to use your product or how it can help them do what they need, they are very likely to drop out.

These are just 5 of the most common churn reasons that you need to monitor, but they are not the only ones. Customer churn may be an inevitability but there are ways to pro-actively prevent churn from the very beginning (onboarding) and, of course, the sooner you recognise the red flags and act on it, the higher your chances at reverting the situation.


7 ways to prevent and reverse churn

1. Offer a great onboarding experience

Did you know that 75% of people will abandon a new software in less than 7 days? There are multiple reasons why people leave so early — they are unable to find a specific feature, they find a different product at a better price, they decide they no longer need it — but one thing is certain: getting your onboarding right is fundamental to prevent churn.
With the right onboarding you can reduce the time to first value and make sure you are creating a relationship for the long run.

You can learn more about this topic in this article and eBook:
- How does a great customer onboarding course looks like (article);
- The big eBook of Customer Onboarding: How to set the perfect Customer Onboarding Programme for long-lasting happy customers (eBook).


2. Provide skills training

Offering skills training is a proven way to entice your clients with rich and valuable content they will find useful in the long run and help them be more successful using your product.
Learn more about the courses you need for great customer onboarding in this article.


3. Make your training available to everyone

You should avoid creating single points of failure by locking knowledge and expertise in one or two people only. If all learning is made accessible, you are effectively spreading know-how and skills to your own advantage. This means red flags such as change in PoC, for example, will no longer be such a problem.
Learn more about how online video training can be a great solution for your Customer Academy in this article.


4. Monitor customer behaviour

Measuring and analysing your customers’ behaviour will allow you to identify early signs of struggle, responding promptly and hopefully reversing the situation. Most of the top Customer Success platforms include features that will help you with this. In this list, you can see the best Customer Success software according to G2.

5. Communicate often and well

It is very important that you establish a strong communication strategy with your customers: no healthy relationship can survive without it! You can see how to create a simple but effective communication plan in this guide we created to help non-marketing folks in this task.


6. Gather their feedback

If you ask your customers for feedback, you are making them feel appreciated while also gathering valuable information that can help you improve. Whenever possible, make sure to let your customers know you actually acted on their suggestions.


7. Learn your customers’ goals and help them get there

Do you know what success looks like for each of your clients? How does your product or service fit into that vision? If you want to keep your customers, it is very important that you can articulate this shared vision of success and communicate it to them often. Your ultimate goal should be to help them reach their goals and be better at what they do.

A customer academy can help you prevent and overcome some of the most common churn red flags. If you would like information on how to achieve this or if you are looking for the right training platform to share knowledge with your customers, why not try bugle?


Get ready to make customer success operations more efficient, scale your company and deal with growth without undermining the customers’ experience and happiness. Click here to download "The big eBook of Customer Onboarding".

How to create the perfect Customer Onboarding Training Programme


You may also find interesting:

Why include video training in your planning for next fiscal year (article)
7 steps to set up Customer Training (guide)
Stop churn: Why customer education is key to success (article)
12 tips to choose the right training platform (article)
5 reasons customer leave and 5 tips to prevent it (article)
Online Video Training ROI Calculator (Calculator)

Would you like to learn more about how bugle can help you offer great customer training? 
Let's talk.

Tags: customer retention, customer success, customer training, customer academy


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