9 May 2016
There is nothing more frustrating than putting time and money into landing a new customer, only to have another one leave.
Customer ‘churn’ can have real financial consequences and, if allowed to continue, can often corrode a reseller’s business. Recurring revenue from departing customers is lost. The opportunity for future upsell is cut short, and capital must be put towards marketing efforts to find new business – a time consuming and costly process.
Customers now have more choice than ever before. Tech convergence and cloud solutions have led to a booming marketplace. The barriers to entry into telecoms have lifted, meaning that IT resellers can now successfully compete against traditional telecom providers. As such, competition is fierce. If a customer is unhappy for any reason, they can now easily move on to the next reseller.
To combat churn, channel partners need to build lasting customer relationships. This is achieved through trust, understanding and adding value wherever possible.
Understand your customers
Understanding a customer’s business needs and challenges is essential for knowing when and how to add value. While this is crucial during the initial sales process, it should also be continued throughout the business relationship.
Regular feedback can give resellers a better understanding of each customer’s situation. Using a customised feedback programme will improve response rates, as size and business type will dictate the preferred frequency and medium of engagement. Speaking with a variety of stakeholders, from frontline staff to C-suite executives, will also give resellers deeper insight into what it takes to keep their customers happy.
Remember, while neutral responses may indicate that nothing is amiss, they can also signify that a customer is not fully engaged. If resellers are merely ‘satisfying’ the customer, consider alternative ways to impress. Goodwill can lead to better retention. Examples include reminding customers of the cost savings they have made, or offering deals across your portfolio.
Provide superior service and support
Always be sure that service quality is consistent throughout the entire customer journey. While the initial interactions between resellers and customers will help build trust, it is essential that resellers meet expectations further down the line. Over-promising during the sales process and under-delivering later on will unfortunately result in customers looking elsewhere for their solutions.
Resellers must also be proactive when giving support. Partnering with the right provider is a great way to achieve this. Look for a provider that offers thorough product support and training, as well as the right system tools. An online portal where resellers can access information at any time will give resellers maximum control over providing end-user customers with the highest levels of assistance.
Plan for retention
Be strategic when choosing new customers. Look for relationships that will be mutually beneficial, as customer success will lead to reseller success. While it’s important to consider profitability, resellers should also consider shared business values. This can be key to ensuring a long-lasting business relationship.
Adding value beyond the product itself can also prevent churn. Whether it’s 24/7 support or simplified billing processes, a competitive advantage will prevent the scenario of customers leaving, despite sticking with the same tools or service.
There will always be unhappy customers within any business. Yet by having the best product, coupled with the right benefits, resellers can stand out in the crowd and see to it that customers never want to leave.
9 May 2016 | Justin Coombes
The views in this article are the personal views of the author and are not necessarily endorsed by Gamma.