Customer churn is a well known concept in business, but it's an oft-ignored statistic in veterinary economics. And it could be costing your practice revenue, big time!
For veterinary clinics, churn refers to whenever a customer chooses to no longer use your services for their pet. Because this decision is often made without your practice management software's knowledge, your contacts database could be hemorrhaging clients and you'd have no idea the extent of the bleeding!
Measuring your clinic’s customer churn rate will allow you to determine the number of lost customers in a time period, help identify if you have a client retention problem, and also gauge the effectiveness of any changes you make.
Before calculating churn rate, it’s important to define what constitutes a churn event for your business. There are multiple ways of defining a lost client: perhaps they communicated their departure directly to you, or maybe their pet passed away, or maybe they just haven’t scheduled an appointment in over 18 months. Once you've defined this inclusion criterion, you're ready to calculate churn rate.
Why is client churn rate important for you to know?
Increase Your Revenue- Measuring your client churn rate will give you a better understanding of your ability to retain clients. Spending time and money to constantly search out new clients can be both exhausting and expensive. Knowing your monthly, quarterly or yearly churn rate can help you determine how much effort and money you need to put towards finding new clients.
Reevaluate Your Business- By discovering your client churn rate you might discover that your business is losing as many customers as you are gaining. If your goal is to grow your veterinary clinic, this is the time to evaluate on how you plan on doing that. Take some time to think about your target market and what it takes to retain them, instead of just attract them.
Become More Aware- Now that you know your churn, you can infer other important information about your practice - for example, customer satisfaction. Word-of-mouth surrounding a bad customer experience reaches twice as many ears as that of a good experience, and 86% of consumers have reported ceasing contact with a business due to poor customer service.
If you are losing more customers than you’re retaining/making, customer service could be a valuable area of focus for amplifying growth. Think about how your clients are engaging with your practice year-round.
Reducing churn is crucial for your business’s success. Measuring your churn rate and understanding your ability to retain customers is the first step towards building an even more successful veterinary business, and serving the needs of even more of your community's pets.