Hard Churn, or High Churn, is a concept used to measure customer retention in the software as a service (SaaS) and online services industry. It measures the number of customers who have canceled or completely terminated their subscription during a given period (typically on a monthly or annual basis).
Hard Churn is generally considered a more serious phenomenon than Soft Churn, which refers to a reduction in usage or subscription amount without complete cancellation or termination. Hard Churn can be an indicator of service quality issues or a lack of perceived value by customers, and it can result in long-term decline in company growth if the issues are not addressed.
It is important to regularly monitor the Hard Churn rate and understand the reasons why customers are canceling or terminating their subscription in order to address them.
How to address Hard Churn?
Here are some strategies that companies can implement to address Hard Churn:
- Implement a referral program: Encouraging satisfied customers to refer new customers can be an effective way to retain the existing customer base and reduce the Hard Churn rate.
- Offer deferred cancellations: Providing customers who want to cancel their subscription with a deferred cancellation period (e.g., a discount on the next subscription) can incentivize them to stay.
- Implement a loyalty program: Offering exclusive benefits to loyal customers (e.g., discounts on subsequent subscriptions or gifts) can incentivize them to stay and reduce the Hard Churn rate.
- Targeted communication: Sending targeted communications to customers based on their usage and engagement