Churn is a widespread problem across almost every industry, but is especially relevant to the telecommunications market, which many believe to have reached saturation point. Competition is at an all-time high and many telcos are recognizing the need to improve customer experience and service – in order to compete effectively.
A comprehensive Telecom Customer Churn survey was conducted to learn more about the drivers of customer churn due to telcos’ level of customer service, to discover when consumers are most likely to churn, and to gauge consumer sentiment about ways companies can improve customer loyalty.
Survey data shows that 39% of Americans who canceled a contract with a company in the past 24 months cited customer service as the primary reason for cancellation. And 52% of them reported that they canceled a phone, internet, TV or cable contract.
Key takeaways:
Churn is triggered by high customer effort: Customers canceled their contracts because companies wasted their time (37% waited too long to have their issue resolved), or because they had to call more than once (51%); other customers churned due to untrained or incompetent agents (37% thought the reps were rude or had a negative approach) or because of inferior self-service options (14%).
Need for improved customer retention strategies: While 44% of customers actively searched for an alternative provider, the remainder churned passively, either because they were disengaged with the telco’s services or because they heard about or were offered a better deal from a competitor.
Reactive retention strategies are ineffective: Despite the fact that 61% of telcos tried to retain their customers after they canceled their contracts – usually by offering a discount or an apology – their efforts were largely unsuccessful.
Proactive efforts are key: Among those who churned following a negative service experience, 40% would have changed their mind if they had been offered a better service plan, and 33% would have stayed if they had believed that the telco’s service would improve in the future.
Fallout from word of mouth: 79% of customers admitted sharing their disappointment about the telco’s level of service with others. 73% discussed the company negatively with friends, family or colleagues, 22% shared it on their social media channels, 12% posted on the company’s official social media channel or website, 10% shared it in an online forum, and 3% even discussed it with the media.
For full access to the 2019 Customer Churn in Telecoms Survey Results, which includes deep dives into the data and eye-opening quotes directly from customers, download the Telecom Customer Churn survey report now.