Ways to Re-engage Customers Before Churn

Preventing customer churn is essential for sustaining revenue growth. Without a solid customer retention strategy, your business faces significant risks.

According to a SaaS Capital study, reducing customer churn by just 1% can boost a company's valuation by 12% over five years. To keep customers engaged, it's crucial to identify the reasons behind their declining interest and take proactive steps to address them.  

But how can you predict churn before it happens? What are the early warning signs? And how can you build a strong re-engagement strategy? This article will provide actionable insights to help you retain and re-engage your customers effectively.

Understanding Churn

Churn refers to the percentage of customers who use your company's products or services over a certain period. It is usually calculated by dividing the number of customers lost in a quarter by the number of customers starting that quarter.

Of course, to get a clear picture of your churn, some form of customer segmentation is essential. For most businesses, new customers will have a higher churn rate than existing customers, so failure to segregate your customer base even at this base level can give you a biased picture..

How Customer Churn Affects your Business

Customer churn is also called defection, attrition, or turnover and is the opposite of a business's ability to retain customers. Churn occurs when a customer stops using a product or service, for example, cancels a subscription or closes their account.

High customer churn rates ultimately undermine a business' ability to generate profits and affect its return on investment. There are at least four ways this churn can be bad news for companies.

1. The consequences of churn can be long term

Churn removes all value from future opportunities with customers. In addition, you have also lost the chance to sell other products or services in your portfolio. You've reduced the total market that would otherwise have been gained because that customer has left or quit. What's more, your brand may now be forgotten from the minds of your customers.

2. Churn help your competitors

Desperate clients tend to be vocal about why they left a brand. Negative customer reviews are a gift to your competitors. Since positive customer referrals can often make or break a deal, negative referrals are powerful ammunition for your competitors.

And your competitors don't hesitate to use it again and again with new prospects. Those volatile customers may come back to close the next deal and stop your source of income.

3. A high churn can indicate a bigger problem

A high churn indicates that something is failing in your customer relationship. Is your product or service failing to meet client expectations? Does your customer orientation process need improvement? Do you devote enough attention to your clients? Even if the high churn rate stems from factors beyond your control, it can hurt your company and products.

4. Churn reduces your value

The churn rate is an essential factor in how investors view your company. VC firms look at customer churn to determine if your product has an edge in the market, and retention rates are critical to Software-as-a-Service (SaaS) public appraisals.

Smart SaaS investors use Customer Lifetime Value (CLV) as a metric to predict how much profit you will make and analyze the company's health. A high churn rate reduces CLV and can drive investors to doubt the strength of your business. So, if your churn rate is high, you are more likely to displease investors and deselect yourself.

Strategies to Re-engage Customers Before Churn

If you’ve noticed signs that customers are leaving, it’s crucial to act fast.  To re-engage past users and strengthen retention, consider these strategies:

1. Understand what causes customer churn

Understanding why customers lose interest is the first step to winning them back. Common reasons include:

• • Poor onboarding experience
  • Unclear product benefits
  • Inconsistent customer support
  • Pricing concerns
  • Lack of engagement opportunities

Gather insights through email surveys, feedback forms, or direct outreach. Ask the right questions to uncover pain points and address them effectively.

2. Meet customer needs

Once you identify the main issues, personalize your re-engagement strategy. Tailor your approach based on their specific concerns:

• • If customers find little value in your product, highlight key benefits through targeted messaging.
  • If service issues caused churn, improve response times and offer proactive support.
  • If pricing is a concern, consider flexible payment options or introduce value-driven incentives.

Listening to customer feedback and making meaningful changes can prevent future churn.

3. Reactivate users with push notification

Past customers are more likely to return if you stay on their radar. Use push notifications, personalized emails, or SMS to remind them of what they’re missing. Try:

• • Special offers or discounts tailored to their past purchases
  • New product features or updates
  • Invitations to exclusive events or webinars

A well-timed, relevant message can bring them back before they fully disengage.

4. Educate your customers

Churn often happens because customers don’t fully understand the value of your product. Offer guided content to help them rediscover its benefits, such as:

• • Product demos or tutorials
  • Feature guides
  • Webinars or live Q&A sessions

Send invitations through push notifications or email to drive engagement. The more they understand your product’s value, the more likely they are to stay.

5. Introducing the loyalty program

Introducing a loyalty program gives customers new opportunities to benefit from your brand. And while win-back incentives may not work for all, long-term loyalty initiatives may be vital to retaining customers.

You can invite customers with an email campaign on the site, social media, or mobile messages. By enrolling customers in a loyalty program, you encourage them to visit more often, explore your products and services, and engage with your brand in exchange for valuable loyalty.

Wrap up!

Every customer disengages for different reasons, so your re-engagement approach should be tailored to their needs. Identify why they’re losing interest, address their concerns, and provide compelling reasons to stay.

A loyalty program is one of the most effective ways to keep customers coming back. Tada’s loyalty and rewards platform helps businesses retain customers through digital memberships, subscriptions, referrals, and an extensive rewards catalog.

With Tada’s smart campaign features, you can effortlessly run win-back programs via automated messaging. Request a free demo today to see how Tada can help your business re-engage and retain customers effectively.