Broadband companies are struggling to retain customers. According to Statista, the average churn rate for internet service providers is 21%. That means one in five customers is thinking of leaving their current provider.
What’s driving customers to leave their broadband providers? And how can you prevent the same thing from happening to your business? Below, we go over the current state of broadband and what’s driving customer attrition.
The state of broadband today
Simply put, most people don’t like their broadband provider. According to the American Consumer Satisfaction Index, internet service providers rank below airlines and even social media companies.
Yet nearly eight in 10 Americans say internet access is a basic necessity. So, why are so many customers changing internet providers?
Five reasons customers are changing internet providers
What’s driving customers to abandon their current broadband provider in droves? Below are a few of the most common reasons customers leave their internet service providers.
Reason one: poor customer service
A poor customer service experience has a detrimental effect on the success of your broadband business. In fact, research shows that low-quality customer service costs businesses $1.6 trillion dollars annually.
Many internet service providers face customer service challenges, such as long call center wait times or multiple calls or transfers for customers to resolve an issue.
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This can negatively impact critical business success metrics such as net promoter score (NPS). In fact, the average NPS score for cable and internet service providers is negative seven. Prioritizing the customer service experience can help your business improve customer satisfaction and brand loyalty.
Reason two: Lack of service reliability
Providing fast, reliable internet connections is vital to improving customer retention rates. Frequent internet outages and slow speeds can lead to increased customer churn and decreased satisfaction.
Reliable internet connections are vital for both your business and your customers’ success. Frequent outages can create hardships for customers. For example, a local restaurant may be unable to process online orders or payments.
Additionally, remote workers might have to seek out a coworking spot, which can be expensive (some cost nearly $700 per month). A lack of reliable service erodes trust among your customer base, and if you can’t meet their needs, they’ll go elsewhere. 59% of customers say poor quality internet is why they’re leaving their current provider.
To prevent this, ensure that your company studies the latest trends and adapts its technology so customers have the reliable connections they depend on.
Reason three: Fierce competition
The broadband industry competition is heating up, meaning customers have more options than ever on different internet service offerings and price points.
Historically, cable companies flourished as broadband service providers because they already had the hard-wired connections needed to set up internet services.
However, technological advances such as fiber-optic internet mean hard-wired connections are no longer necessary to connect people's homes or businesses to the web.
As a result, it's been easier than ever for other companies to jump into the broadband market, even if internet services haven't been a traditional part of their offerings.
For example, Verizon Wireless has begun offering its own internet service. Verizon has rapidly added new broadband customers and has even been recognized by J.D. Power as a top internet service provider for small businesses.
Many of these industry newcomers can successfully steal customers due to competitive pricing and rewards systems. Companies looking to stay ahead may want to consider how their pricing compares to competitors and how they can create different plans to meet customers' needs for reliable connectivity and affordable prices.
Reason four: There’s no customer self service options
Customer self-service is a must-have for any successful broadband business. According to Statista, 88% of customers expect companies to provide self-service options.
With customer self-service, your customers get instant access to tech support at any time of day or night. While agents need to sleep, self-service technology such as conversational AI chatbots never do.
However, to provide an excellent customer self-service experience, you must set customers up for success. Most customers say businesses don’t provide enough resources to allow them to resolve issues independently.
To avoid this, ensure all self-service resources provide accurate, up-to-date information and are WCAG 2.0 compliant so they’re accessible to all customers, regardless of ability.
Reason five: Poor communication and a lack of transparency
Imagine you and your family are streaming a movie, and suddenly, your internet turns off without warning. Or you lose your internet connection while making an important sales pitch to a potential client. Later, your provider tells you that the outage you experienced was due to pre-planned maintenance in your area.
While we all appreciate our internet providers ensuring they’re using the latest technology, the fact that there was no forewarning is a little frustrating. After all, if you’d known they were going to do pre-planned maintenance, you wouldn’t have scheduled a sales presentation during that time.
This is why communication and transparency with customers is so important. Not communicating with customers about outages or scheduled maintenance can lead to frustration and eventually customer churn.
Communication and transparency are two powerful tools to improve customer loyalty and stop customer churn in its tracks. Nine out of 10 customers remain loyal to brands that offer complete transparency.
Additionally, studies show that customers who received communications about service outages had higher satisfaction rates than those who didn’t. Outages and maintenance happen. But if your company is looking to hold on to customers, it’s vital to ensure that you’re not keeping them in the dark.
Keep customers loyal to your broadband business
The competition in the broadband market is fierce. More companies are entering the broadband market, which makes it easier for customers to switch to a competitor. By understanding the top reasons customers are changing internet providers, your company can be proactive in reducing customer churn and increasing brand loyalty.
Are you a broadband company looking to scale support while increasing customer satisfaction? As a leader in comprehensive customer support, Ozmo is trusted by Verizon, AT&T, Google and more. Learn more about the future of tech support today!
