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AI Key to Retaining Customers: The Great Customer Resignation

We’ve all heard about the Great Resignation, but what about the Great Customer Resignation? In the face of growing customer demands, how can you keep your clients happy? Lucy Gillman spoke with Craig Charlton, CEO of SugarCRM, to discuss their 2022 CRM Impact Report and what it means for you.

LG: To kick off the interview, could you introduce yourself and your role at SugarCRM?

I’m Craig Charlton, the chief executive officer at SugarCRM. I lead all facets of the SugarCRM business, from setting our vision and strategic direction to making sure we’re executing in the best possible way on the ground every day. In my career, I’ve spent over 25 years building and running high-growth businesses.

LG: Let’s go back to basics: what is the Great Customer Resignation? Why did you research it? What answers were you trying to find out through your research?

We commissioned Arlington Research to listen to and survey sales and marketing decision makers in four locations (USA, UK, Germany, and Australia) to explore issues around customer satisfaction and retention. The objective was to understand how technology is transforming the expectations of both sales and marketing leaders and their customers, which roadblocks and blind spots are causing sales friction and contributing to churn, the impact of misalignment between sales and marketing, and the impact this has on organisations.

Last year, SugarCRM’s global survey research revealed customer churn was costing mid-market companies an average of £4.2M per year. In this year’s survey, we found that 58% of respondents reported their rate of customer churn has increased over the last 12 months. This is what we have called the ‘Great Customer Resignation’. It is yet another challenge for brands fighting an onslaught of forces including supply chain disruption and employment challenges – threatening the future of companies across all industries worldwide.

LG: To go back to basics, why is the Great Customer Resignation so important? Should this be a top priority for B2B marketers in 2022?

The high cost of customer churn is intensifying and exponential. Retaining customers is especially vital in today’s era of recurring and subscription businesses, for instance. Our research shows that customers are leaving in droves – at a rate of nearly 1 in 2 new customers added in the US and 1 in 3 worldwide. It is integral that companies stay on top of resolving the Great Customer Resignation —and quickly.

This starts with delivering a consistent, personalised CX. A bad experience diminishes brand value and hurts both retention and revenue;81% of sales and marketing leaders believe their customers leave because of a lack of communication and personalised, relevant messaging. Organisations must develop a more customer-centric business philosophy and leverage technologies such as CRM that can help optimise and personalise customer engagement throughout the entire customer journey. The more information you know about your customers, the easier it is to create consistent, personalised sales, marketing, and customer service activity. This will ensure better customer retention over the long term.

LG: As per your research, what are some of the common problems within businesses that lead to customer resignation and how can marketers overcome these challenges?

There are several factors that contribute to customer churn per our research and my experience.

Firstly, our research revealed that 71% of global respondents suspect customers are leaving due to poor customer service or experience. This explains why 70% of respondents said they need to do more to improve customer trust in their organisation and why 73% underscored the need to act on customer feedback for improved customer service and experience.

One of the most concerning stats is the fact that 56% of organisations say they are missing customer activity data to improve marketing campaigns and sales conversions to mitigate customer churn. The gap in data and lack of insight prevents organisations from gaining the information they need to make both strategic and tactical decisions.

Additionally, attitudes towards traditional CRM solutions suggests they are too difficult and overly complex to use, resulting in low adoption and wasted resources. Our research found that 57% of UK respondents think their CRM system is costing them money, while 65% say their current CRM system cannot be customised properly to meet their specific needs. The more time sales and marketing teams waste on administrative tasks, the less time they can spend on valuable activities such as improving the customer journey, closing deals, and helping grow the business.

This negative view of current CRM solutions may be why 59% of global respondents said they plan to change their current CRM platform within the next 12 months with 34% saying they will change providers. To put it bluntly, sales and marketing leaders are failing to realise the benefits of what an AI-driven and purpose-built CRM platform can offer.

Delivering great CX is getting easier with AI. And it should be an area marketers focus on in 2023. AI can help drive more profitable outcomes such as intelligent lead scoring, predictive forecasting, personalised recommendations, next-best actions, relevant cross-sell opportunities, and, importantly, churn prediction and prevention.

LG: How can organisations identify when customers are in danger of leaving your business? Assuming the key is to listen to customers, what is the best way to do this? Is it introducing a CX or customer success team, or is it a case of customer surveys, NPS scores, or something else?

The first step for organisations is to identify when customers are at risk of churn. Followed by knowing the corrective steps to take to prevent churn. In our study, 57% of global respondents admit their organisation struggles to quantify and track churn rate effectively. The path to overcoming customer flight starts with removing the blind spots that are limiting your view of what your customers want so that you can predict what they need next. This can be achieved by eliminating busy work and providing the necessary tools to engage with customers and give them the seamless experience they expect. Our survey says a unified view of sales, marketing, and customer service is critical to delivering an optimal CX, but the lack of such a data infrastructure fuels a customer relationship crisis.

An AI-infused CRM platform can help companies reach new levels of performance and predictability and improve customer lifetime value, allowing companies to focus on customer retention and experience. It can produce unparalleled levels of prediction accuracy, while innovations such as no-code/low-code user interfaces are poised to reduce the time, cost, and technical expertise typically required to get AI up and running. Its data-driven ability can help predict future customer churn and trigger proactive actions to retain customers. Not to mention the fact that automation reduces the need for sales and marketing to work manually, creating better, faster, more productive and more informed decisions.

LG: To zoom further out, what are customers looking for from businesses in 2022? There’s been lots of talk about personalisation, enhanced digital experiences and the growing importance of ESG programmes. Are these the top three things to look out for, or are customers now expecting something more?

Indeed, customers are increasingly looking for personalised experiences in 2022. With many interactions now taking place online due to the pandemic, customers want to receive the same or even better experiences they once received in person.

I’ve mentioned the benefits of AI, but there’s an added emotional layer to consider. Customer service teams can then respond in real-time with the next-best action, allowing for a focus on prioritising human emotions. Ensuring that empathy is at the forefront of marketing strategy leads to an increase in new customer generation as well as increased trust amongst existing customers. This is one of the many benefits of enhancing digital experiences.

Maintaining customer retention is more sensitive (and difficult) than ever. Customers now want to be supported at every touchpoint. To do this, frontline support agents need to be armed with the right technology, resources and shared knowledge to diagnose and solve problems quickly.

In recent years, we have seen more of a focus on the accountability of organisations and brands to not only have an ESG programme in place but to be consistent and transparent with their ESG reporting. It’s becoming a key element in customer consideration and brand strategy and organisations who wish to thrive will undoubtedly have to consider how green their marketing is.

LG: It seems to me that there’s a link between the Great Customer Resignation and Great Resignation. Running parallel to increasing customer demands, do you think employees now expect more of their organisations? If so, in what way? How can organisations keep both their customers and employees happy?

Our research clearly shows that sales and marketing teams are burned out. The global pandemic is still wreaking havoc on quotas and organisations’ ability to meet customer expectations and to effectively grow their businesses. Sales and marketing professionals are spending far too much time on manual data entry, tracking down vital customer information, and resolving issues in their CRM system. This all translates into a diminished CX, missed quotas, churn levels creeping up, and an overall frustration that something just doesn’t quite fit.

It’s unfortunate that those who stand to benefit most from a CRM system either can’t or won’t use it because it’s overly complex and not very user-friendly. Technology is supposed to make work more efficient and is especially vital now, as we rely even more on technology for collaboration in a distributed or remote workplace.

CRM must be accessible, and it must be AI-driven to help make the hard things easier for sales, marketing, and service teams.

LG: What defines a successful client-customer relationship look like in 2022?

CX is everything these days, and it defines the relationship between a business, its employees, and its customers. With every customer interaction being a decisive moment, it’s critically important to bridge the gap between customer expectations and actual experience. Today, data plays a massive role in fuelling the CX. And yet, a primary struggle for many organisations is that they have an incomplete view of customer activity. According to our research, one in four sales respondents worldwide believe they could miss a quota because of incomplete data across the customer lifecycle.

A shared CRM data platform that connects every stakeholder with a complete real-time customer view is the foundation for creating a strong CX (and pipeline!). Data provides the actionable insights that sales, marketing, and service teams need to act decisively at every critical touchpoint throughout the customer journey. A connected CRM system ensures an airtight brand-customer relationship that enhances customer satisfaction and loyalty.

LG: Do you see any signs of this Great Customer Resignation slowing down? How can businesses successfully deal with this challenge in 2022?

We can put an end to the Great Customer Resignation. Our study clearly shows that sales and marketing teams can stem the tide of customer churn and produce relevant CX if they just apply the right resources—and develop a highly customer-centric mindset. It all starts with a CRM platform that connects every stakeholder with the same data, easily accessible and loaded with insights that help sellers and marketers give customers exactly what they want.

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