Writing / Hunter Harris
Churn - The Truth is Out There
You’ve seen it. You’ve been working a customer for months. The sweet talking. The gifts. The back and forth. The demos. The meetings. The romance! Finally you choose to Do a Business Marriage and they sign on the dotted line. You’re set!
A month later, they’re gone. What happened??
Well, there’s an infinity of options. But let’s get forensic - there’s a story to be told here. At one point, they wanted to give you money. At another point, they do not. Something happened. What changed?
Inattention
First off, I have a challenge for you - if you have a customer churn, you should be able to pinpoint the day they decided to churn. How can you tell? Generally - engagement. If you cannot, you’re asleep at the wheel. Data is there for you to analyze, if you choose to gather it.
There’s engagement, and then there’s engagement. One is “I am productively getting value out of your goods and services”, and we’ll get to the latter in the next section. Emails sent. Customers pleased. Whatever your outcome is, capture it and display it. Not just externally to your customers, but internally. You should know what successful engagement with your software looks like. “Successful customers send 100 emails in the first 30 days”, “Successful customers configure 10 coupons in the first 14 days”, “Successful customers process 1000 transactions per month”.
The first sign you’ll see is disengagement. An otherwise healthy customer will stop using your software. You either will not know, stopping you from acting, or you will not care (or rather, you will have hired people that do not care), stopping you from acting.
When it’s early, you may be able to win them back. Some will naturally leave for good reasons. Others will not.
Regardless, if a customer is seeing value in your platform in excess of what they pay why would they leave?
Friction, or Death By A Thousand Cuts
Look, it’s pretty rare that people love something and then get deterred by it. Emotions have weight, momentum, mass. They drift, and don’t make hairpin turns.
Instead, an accumulation of events add up to a change in emotion. Again, if a customer is seeing value in your platform in excess of what they pay why would they leave? Well, they leave because the juice isn’t worth the squeeze. They want something, and it’s too hard, slow, or annoying to get it.
Onboarding is a simple example. We’ve all seen the flows where you have to fill out all 20 questions to start using software - name, address, mother’s maiden name, industry, SSN, blood type, firstborn child. These forms always say “to serve you better” but we know better! That’s going into your sales org and your marketing org so you can segment and upsell. That’s totally fine - but it has cost! They is a signal to every onboarding customer that you value your business operations more than their time. You’re leading the relationship with a paper cut.
Then, there’s a 12 step process when it could be two. Another papercut. Then checkboxes atop checkboxes. Another papercut. A core pageload takes 2.2s instead 0f 0.02s. Another papercut. Downtime during core hours. Only 5 minutes, but I can’t get that data for a report last minute. Papercut.
None of this is a chest wound, it’s just a slow bleed of trust and goodwill. Eventually, someone else comes along (or, someone internal pokes at something with AI). Suddenly, they can get things done without you, cheaper and faster, hard better faster stronger.
Why wouldn’t they churn? There’s someone better, and tearing up that Business Marriage is a lot easier than unwinding a real one!
The Good News
In my career, I’ve never seen silent churn. Customers like to complain! Some of the signal is in support tickets. Some of it is in catchup calls you Success or Sales team makes to customers. A ton of it is in observability metrics accessible to product and engineering.
You can absolutely put this information together. “Knowing is half the battle” - you can’t fix what you don’t know is broken.
On the other hand, it’s easy to let things languish. One-off support tickets languish in the backlog, with no one putting them together into a constellation. One off conversations happen is Sales, that don’t make it out of the department. Dashbaords that don’t get viewed. Usage cliffs that don’t trigger alerts.
It’s easy to be asleep at the wheel. But something changed, something happened.
Get curious about it - the truth is out there!