Remember the first time you lost a customer?

Back then, it felt devastating. Add some pouring rain, crank up “Delilah” in the background, and it’s almost like a scene from a movie about a courageous entrepreneur.

You’re now running a thriving business. Losing customers is a painful but inevitable part of your life. Sure, in a perfect world, you’d have 100% retention – but there’s plenty more fish in the sea.

But you keep wondering: why are some of them leaving?

You know that a poor experience is the #1 reason customers jump ship. But your product is top-notch and your support is awesome – why would you be part of the statistic?

In this week’s post, we’ll try to answer why your customers might be leaving – even from a company as awesome as yours. We’ll also examine how you can keep more of your customers by helping and supporting them less, not more!

(Note: we’re hosting a free event next week – it’s about using interactive video to help you keep more paying customers for longer. We’ll share the details at the end of the article, if you’re interested.)

Without further ado, let’s dive in – starting with “Why?”

Understanding friction, and how it steals your customers

Aside from genuinely terrible brand interactions, friction is the biggest reason customers have a bad experience. Yes, even if you treat them like royalty, and they like and need your product.

Customer psychology defines friction as “psychological resistance to any element of the sales or signup process” (definition by MarketingExperiments.Com).

It’s a little vague, though, so let’s look at some specific examples:

  • A landing page that’s too short / too long for your offer = friction
  • A marketing message inconsistent with the tone of your brand = friction
  • A confusing, multi-step checkout process = friction
  • Lack of testimonials or other proof… you guessed it – friction!

This is a useful definition. But it misses one all-important detail. Friction occurs throughout the customer journey – not just in the leadup to the sale, but for the entire customer lifecycle. Your entire customer experience hinges on the presence or lack of friction.

Here’s an impressive, slightly scary list of things it can make or break for your business:

  1. Customer lifetime value. The more annoyed a customer is with doing business with you, the less often they will buy. First off, they will leave sooner than a satisfied customer might. And even before they switch companies, they won’t spend any more on your products or services than they have to. Speaking of which…
  2. Average deal value. When your customer wants to make a new order and experiences friction, they won’t buy as much as they could have. A great customer experience is directly connected with how much every customer spends per purchase.
  3. Word-of-mouth marketing. The more friction your customers experience while interacting with your brand, the less likely they will be to recommend your company to someone else. Because word-of-mouth is an insanely powerful form of marketing (arguably the most effective), this puts you at a severe disadvantage for getting social media traction, new leads, or paying referrals.
  4. Your profit margins – and profits, period. Because acquiring a new customer is 5-25 times more expensive than retaining an existing one, poor customer experience caused by friction can poison your long-term business growth. By contrast, retaining just 10% more customers can help you boost profits by anywhere from 25 to 95 percent.

You’re probably thinking, “OK, I get it. Friction is bad. But surely, if customers contact my company for help, the relationship will be saved?”

After all, it’s only logical. A customer has a bad experience. They reach out to have the problem solved. Your team goes above and beyond to help them. They walk away happy, and continue to be a loyal customer.

Sadly, that’s kind of fairytale ending doesn’t always happen in real life. Because guess what…

Getting support contributes to friction (oh, the irony!)

Having to contact, and interact with, customer service, is actually one of the biggest sources of friction and frustration for customers. And it’s understandable: they have already been inconvenienced, already had a bad experience. Reaching out and waiting for the problem to be solved only makes it worse!

If you’ve ever spent 20 minutes on the phone waiting to be put in touch with a customer service rep… only for the phone call to drop, you know exactly what we are talking about. And that’s why, by 2020, customers will manage 85% of their relationship with a brand without interacting with a human (according to Gartner Group).

But if that’s ever going to be a viable option, for any company, they will have to invest in a smooth, delightful customer experience. Especially at the onboarding stage, when your relationship with a brand-new customer is more fragile than ever. We believe it’s the only long-term solution to the problem of customer churn.

So what does a great onboarding experience look like? It shifts power to the customer.

Customer onboarding: empowering your customers to solve their own problems

How easily and how quickly can a customer solve a problem they’re having with your product or service?

This is what matters most for customer retention – more than how much they trust your brand… or even the quality of your product or service.

That’s what a great onboarding experience is all about. It helps your customers to help themselves. And it does that by:

  • Educating them about your product or service – so they know how to get the most value out of it.
  • Showing them the path to achieve results – so they get a “quick win” as fast as possible, and continue to use the product, as opposed to just forgetting about it.
  • Walking them through solving problems – so they don’t experience unnecessary friction and frustration of asking for help to solve a trivial issue.

As you can see, a great onboarding experience doesn’t just say, “Here’s how to do X, Y, and Z. Now just contact us if you have any issues.” That wouldn’t solve much! It also equips your customer with the exact tools to troubleshoot their problem, find the solution, and implement it.

For example…

  1. Let’s say your customers want to investigate a credit card charge by your company. To help them do that without bothering your Accounts department, you could point them to a billing portal. There, they would be able to see how much they still owe, what the charge was for, and download receipts or invoices if they need them.
  2. Maybe your customers frequently have tech issues with your product. In that case, you can direct them to the knowledge base, and explain how to search for the relevant article. Or you could build a chatbot that can retrieve an article on demand and display it for them, which is a bit more user-friendly.

Now, if you’ve been paying attention at the start of this article, right now you’re wondering, “But wouldn’t this also cause friction and frustration?” And you’re absolutely right!

A good onboarding experience can save your customers and your team a ton of frustration – but it can still be quite bumpy. There are two main problems: abandonment, and opacity.

Problem #1: Abandonment

Conventional onboarding practices don’t lead to high engagement. That’s why some industries offering complex solutions (e.g. SaaS companies) have so much trouble with customer churn.

Most customers won’t read through a knowledge base article, or endure a website tour, or poke around their personal billing portal. Sure, it’s less infuriating than having to call a helpdesk. But that’s a very low bar, and you know it!

Problem #2: Opacity

The only way for customer onboarding to be effective is – customers have to know it’s moving them closer to a desirable outcome. Otherwise they will get frustrated and give up.

Clicking through notifications during a tour, or filling out forms in a survey don’t feel like making progress. Neither does reading help articles, wasting time with a chatbot, or updating billing information. There’s no structure and very little personalization.

Now, how can you solve both of these problems in your onboarding process, and end up with more loyal, happier customers as a result? Just add interactivity!

Meet the solution: interactive video

Now, we’re in the business of video marketing. Of course we would say that interactive video is the answer!

But if you look at all the problems and challenges we discussed about customer onboarding, and then look at the unique strengths of interactive video… you’ll see that they perfectly overlap.

  • Customer onboarding has an engagement problem. Well, interactive video keeps people hooked like nothing else, with up to 1,400% above-industry-average clickthrough rates, and average viewing times of 5 minutes or more (as shown in this case study). If you want your customers to sit through, and internalize, some important information, interactive video is the best way to accomplish that.
  • With onboarding, customers have to know it’s helping them achieve a desired result. An interactive video can tell them what to do, walk them through the process, and guide them towards the next step, all without interrupting the experience! From start to finish, your customers will have clarity about what they are doing and why.
  • You need more ways to maximize your customer lifetime value, because your profit depends on it. Well, by onboarding your customers with interactive video, you can give them personalized upsells and cross-sells based on factors like how long they’ve been with your company, how much they have spent so far, and so on. And you can use personal information like their name or birthday, or anything else they volunteered to you, to make the video feel personal, and to surprise and delight them.

This is just a tip of the iceberg. Interactive video has dozens of applications for creating delightful onboarding experiences. And the technology is now at the point where the majority of companies, including yours, can benefit from it.

Do you want to learn more? We would love to tell you – next week, on a special live webinar: “Interactive whiteboard video: Customer onboarding that will surprise and delight”!

Here’s what’s it’s all about…

Master onboarding with interactive whiteboard video (free webinar)

On April 25th, at 2PM Eastern / 11AM Pacific, we’re going to host a free live webinar together with our partners at RaptMedia – the leading company in the field of interactive video marketing.

Together, our CEO Summer Felix and RaptMedia’s VP of Partnerships Greg Adamietz will show you how you can leverage interactive whiteboard video in a way that delights and engages your customers more than ever.

Summer and Greg will demonstrate real-life examples of amazing customer onboarding, and reveal how it influences your customer loyalty, retention – and your bottom line. They will also show you how to create an interactive video strategy of your own, and incorporate it into your customer onboarding process.

Sounds good? Then click the link below to register for the webinar and reserve your free seat:

“Interactive whiteboard video: Customer onboarding that will surprise and delight”

Not sure if you can make it to the webinar on April 25th, 2PM Eastern / 11AM Pacific? You want to register anyway, because we’ll send you an interactive recording after the event!

We hope to see you there!