Identifying and Rescuing the Right At-Risk Customers
Do these scenarios sound familiar to you?
- Your customer engagement team meets weekly to discuss a game plan for customers who are at risk of churning. Each member of the team has access to spreadsheets that document all the touchpoints, support tickets, survey, usage and any relevant anecdotal data about the customers who are within months of renewing. The team then makes decisions about who and how to save the accounts that appear at risk. The spreadsheets are updated and then revisited the following week for additional game planning, if necessary.
- Or, perhaps your professional services team collects data about customers and then works with sales and support teams to figure out who is “on-point” to throw bodies at problem accounts until they become healthy.
- In both cases, there may even be a color or code system to indicate how severely at-risk a customer is. For instance, some folks use red/amber/yellow/green to denote the level of risk of the customer.
These are some typical ways of teaming up to determine who needs some love, and who will be responsible for delivering that love to customers who appear to be churn risks.
NOTE: Not all accounts are created equal.
The truth is that not all accounts merit the same kind of attention. Even if they behave similarly, (i.e. usage patterns, survey data, etc.), some accounts deserve more love than others.
Red Zone vs. Dead Zone Customers
Red Zone customers are those that are at risk and deserve to be resuscitated. Dead Zone customers are those that are dying and aren’t worth the resources to resurrect.
How are you differentiating between these two types of customers and then successfully escalating to bring them back to life?
Here are some things to consider:
- Meaningful health scores involve more than usage metrics. Consider aggregating both quantitative (i.e. usage) and qualitative (i.e. sentiment) data in formulating health scores that accurately assess the vitality of your customers. Customers with low usage rates aren’t automatically Red (or Dead). They may just need further training to help them grow in confidence and expand their usage habits.
- The value of the customer is not the same as the ARR of the contract. While it’s true that customers with high dollar contracts are valuable, that alone does not reflect the full value of a customer to your organization. Vocal customers who share their opinions about your product and organization through crowd-sourcing sites have significance worth considering. In the context of Red Zone/Dead Zone customers, those that are vocal detractors, even if they contribute relatively minimal recurring revenue to your business, may still be worth investing in because of their tendency to share their opinions. Turning a detractor into a vocal promotor can be very impactful.
- Consider the entire customer experience when assessing their churn risk. Customer Success alone is not enough. Even customers who are achieving their desired outcomes with your solution may have festering issues with other parts of your organization and be in need of additional attention to mitigate their risk of churning. Having a complete view of the customer from every angle (sales, marketing, finance, R & D, Support, and Customer Success) is important in determining how red your customer really is.
- Dead customers don’t just disappear. Even if you’ve determined that a customer is not worth saving, you don’t want them to leave with a bad taste in their mouths. If you’ve determined that a customer is simply a bad fit for your business model, it may still be worth your time to conduct an exit interview with them. This will not only give them an opportunity to explain why they are no longer invested in your solution, but it will also leave them with a positive image of your organization, which may result in them referring another customer down the road.
Whatever your approach to defining and tending to at-risk customers, you may want to consider how you are making your decisions:
- Do you have the right data?
- Do you have enough of it?
- How are you aggregating and analyzing the data?
- Do you have the right resources to save the accounts that need saving?
- Do you have best practices for re-engaging customers?
A platform that provides a 360° view of your accounts and provides you the ability to collaborate across the organization (Work 360) is an essential tool in gathering the right data, analyzing it accurately, and supporting the work needed to save your Red Zone customers that deserve your attention.