Hello, this is Matsubara, CRM Evangelist.

"I wonder how that customer is doing these days."
"—By the time I thought that and contacted them, they had already switched to another company."
Many sales representatives have likely had this experience at least once.

This time, we'll delve into why we often fail to notice the signs that customers are leaving, and explain how to detect them early.

table of contents

1. The experience of "realizing you've drifted apart"
2. Why does customer churn occur "silently"?
3. Five reasons why you might not notice
4. Specific signals that indicate an impending defection
5. Reasons why you can't judge based solely on "fewer contacts."
6. What changes when viewed from three different perspectives?
7. The mechanism of Churn prediction
8. What should you do after you notice something?
9. Establish an organizational system to detect defections.
10. Signs of customer defection by industry
11. Actual operational flow in EMOROCO CRM Lite
12. Even if you notice it, you can't prevent it 100%.
13. Why do people tend to interpret things in a "positive light"?
14. The economic impact of preventing defection
15. Frequently Asked Questions (FAQ)
16. Summary

1. The experience of "realizing you've drifted apart"

In sales and customer success settings, the following situations are common:

When I contacted them after a long time, they said, "We've already started using another company."
I only realized that the other party's enthusiasm had waned when it came time to renew the contract.
"Come to think of it, I haven't heard from that company lately," I thought, but by then it was already too late.

All of this indicates that the process of customers leaving was actually happening slowly and quietly.
Rather than a sudden separation, this pattern involves noticing changes that had been progressing unnoticed until later.

2. Why does customer churn occur "silently"?

Customer churn often progresses through the following stages:

- Satisfaction level gradually begins to decline
- The frequency of inquiries and communications gradually decreases.
・Start considering other options
- Actually switching contracts or terminating transactions

This entire process often takes several weeks to several months, and it's not a case of a "defection" happening in an instant.
That's precisely why it's so difficult to notice these subtle changes in the course of daily work.

3. Five reasons why you might not notice

Reason ①: They haven't looked at the behavioral data.
Without the habit of regularly checking behavioral data such as customer visit frequency, number of inquiries, and document download status, you won't even notice the changes.
In many companies, even if this kind of data is recorded, no one actually looks at it.

Reason ②: Relying too much on intuition
The feeling that "things are going well with that customer" is merely an impression based on the last time you interacted with them.
If our perceptions aren't updated, they become fixed as outdated information.

Reason ③: They only see the moment of contract renewal or cancellation.
Many companies only check on a customer's status when it's time for contract renewal.
However, signs of defection often appear months before renewal, and in many cases, by then it's already too late.

Reason ④: There is no definition of a defection signal.
If an organization doesn't define what constitutes a "warning sign," then each person in charge will have to rely on their own judgment.
Judgments based on intuition can vary greatly in accuracy depending on the person making them.

Reason 5: It becomes a lower priority amidst busyness.
When you're busy dealing with new customers or urgent issues, attention to existing customers who seem fine for now naturally gets pushed to the back burner.
This was previouslyBefore spending a large budget on new customersThis is precisely the structure that makes it easy to neglect existing customer support, as explained earlier.

4. Specific signals that indicate an impending defection.

In fact, some of the signals that are likely to appear as an impending defection include the following:

- The frequency of inquiries and communications has decreased compared to before.
- Replies to emails and messages are delayed.
Despite personnel changes or resignations, progress has not been made in building relationships with successors.
- Their response to additional proposals, which was previously positive, has become negative.
They are becoming more sensitive to fees and contract terms than before.
- As part of industry information, we are hearing the names of our competitors more and more often.

Some of these signals can be difficult to interpret on their own, but when multiple signals appear together, it may indicate an increased risk of defection.

5. Reasons why you can't judge based solely on "fewer contacts."

It's important to note here that judging someone as leaving based solely on a single signal like "reduced communication" is premature.
The following are some possible reasons why communication decreases:

- The relationship is going well, and there are no particular problems, so there is no need to contact them.
Conversely, the relationship has cooled, and the desire to contact each other has been lost.
- It's simply a busy time for the customer.

Even though both situations involve the same phenomenon of "reduced communication," the underlying reasons can be completely different.
To discern these differences, it's necessary to combine not only behavioral data (objective) but also on-site observations (subjective) and the customers' own voices (their own evaluations).

6. What changes when viewed from three different perspectives?

Combining the three axes used by EMOROCO CRM Lite—nurturing score, emotional temperature, and NPS—significantly changes the accuracy of this judgment.

・Nurturing score (objective)We capture changes in interest levels from behavioral data such as portal access and inquiry frequency.
・Emotional temperature (subjective): This records the level of relationship the person in charge perceives during their interactions.
・NPS (Net Promoter Score): We directly verify how customers themselves rate this company.

For example, if all three of the following conditions are met—"communication has decreased (lowering nurturing score)," "the person in charge is also feeling a decrease in enthusiasm (lowering emotional temperature)" and "ratings on NPS surveys have also declined"—then this can be judged not as mere temporary busyness, but as a sign of a serious risk of customer churn.
Conversely, if communication decreases but there is no change in emotional intensity or NPS, it can simply be interpreted as the relationship entering a more settled phase.

7. The mechanism of Churn prediction

Churn prediction is a mechanism that combines these factors to detect the risk of customer churn in advance.
BeforeCRM design to reduce customer churnAs explained earlier, you can build a system that continuously monitors changes in behavioral data and issues alerts when certain criteria are exceeded.

- List customers whose behavioral data has not changed for a certain period of time.
- Highlight customers whose emotional temperature has dropped on the dashboard.
- Automatically generate follow-up tasks for customers whose NPS (Net Promoter Score) results fall below a certain level.

These mechanisms can transform the situation of "I realized we had drifted apart" into "I noticed and was able to take action."

8. What should you do after you notice something?

Once you recognize the risk of defection, the following actions are effective:

First, make a frank contact to check on the situation (even a casual approach like "How have you been lately?" is fine).
Review past interactions to identify any incidents that may have caused dissatisfaction.
If necessary, take steps to rebuild relationships, such as changing the person in charge or having a supervisor present.

The important thing is to take some kind of action as soon as you notice it.
If left unchecked, the defection process will only intensify.

9. Establish an organizational system to detect defections.

It is important to create an organizational system for recognizing employee defection, rather than relying on the individual's perception.

- Set aside time weekly or monthly for the team to review customers with significant discrepancies in emotional temperature and nurturing scores.
- Create a system for conducting NPS surveys regularly or at key milestones.
- Ensure that managers are also aware of how to handle customers at high risk of churn, rather than leaving it to a single employee.

These initiatives are directly related to the efforts to prevent reliance on individual expertise, which I previously explained in my article on how to eliminate reliance on individual expertise in sales .

10. Signs of customer defection by industry

The signs of defection vary depending on the industry.

・Subscription-based servicesA decrease in login frequency or usage time is the most obvious sign.
・B2B recurring contractChanges in the frequency of regular meetings with the person in charge and changes in their response to additional proposals can be signs of this.
・Storefront businesses (hair salons, restaurants, etc.)A sign that the customer visit frequency is starting to increase compared to previous patterns is a good indicator.
・Long-term contracts such as insurance and mutual aidA decrease in inquiries outside of renewal periods and an increase in consultations regarding reviewing contract terms can be signs that something is wrong.

It is recommended that you take some time to organize and identify what behavioral changes are likely to be signs of customer defection within your own industry.

11. Actual operational flow in EMOROCO CRM Lite

Here is an example of an operational flow for detecting customer churn using EMOROCO CRM Lite.

- Automatically collect behavioral data (portal access, number of inquiries, etc.) for each customer.
- The person in charge will record their emotional state after business negotiations or phone calls.
- Send out NPS questionnaires at key milestones, such as a few months before contract renewal.
- On the dashboard, customers with significant discrepancies across the three axes will be displayed as priority for follow-up.
- Use the workflow function to automatically send notifications to the responsible person when a customer exceeds a certain threshold.

By implementing this entire process as an extension of daily operations, we can integrate the detection of customer churn into our normal business processes rather than requiring special tasks.

12. Even if you notice it, you can't prevent it 100%.

To be honest, even if you notice signs of defection, you can't prevent all of them.
There are factors beyond our control, such as changes in pricing or the customer's business policies.

However, there is a significant difference between losing customers without even realizing it and losing customers even after you have noticed and done everything you can to address the issue.
The former is the result of "doing nothing," while the latter is the result of "doing everything that could be done."
This difference can also lead to improvements within the organization.

13. Why do people tend to interpret things in a "positive light"?

Psychological factors also play a role in why we fail to notice the signs of defection.
People tend to prioritize accepting information that is convenient for them and overlook information that is inconvenient.
This is a psychological tendency commonly known as "confirmation bias."

"We've had a long relationship with that customer, so it'll be fine."
"Even if they contact me less, it's probably just because they're busy."
—These interpretations are not due to the person in charge intentionally being optimistic, but rather stem from an unconscious psychological tendency to distance oneself from unsettling possibilities.

The fact that this tendency exists is not necessarily a bad thing.
However, in order to objectively evaluate signs of defection, it is important to be aware of this psychological tendency and to develop the habit of confirming your interpretation with external indicators such as data.
The deliberate recording of subjective indicators like "emotional temperature" is a technique used to allow the person in charge to objectively reflect on their own interpretation later.

14. The economic impact of preventing defection

Let's also look at why early intervention in the event of defection is so important, from an economic perspective.
In the world of marketingThe "1:5 Rule"
—It is a well-known principle that the cost of acquiring a new customer is five times the cost of retaining an existing customer.
In additionThe "5:25 Rule"
—There's a principle that simply improving customer churn rate by 5% can improve profits by at least 25%.

As these principles demonstrate, preventing a single customer from leaving has economic value equivalent to acquiring many new customers.
Investing in recognizing signs of customer defection is not merely a matter of "attentive customer service," but rather a management decision that directly impacts the very revenue structure of the business.

15. Frequently Asked Questions (FAQ)

Q. How often should I check for signs of defection?
Depending on your industry and contract cycle, we recommend making it a habit to check the status of your key clients weekly or monthly.

Q. When is the best time to send out NPS questionnaires?
It is common to send these at significant milestones, such as a few months before contract renewal or after the completion of a major transaction.

Q. What should I do if the emotional temperature input is inaccurate?
Emotional temperature is simply a record of the on-the-ground feeling.
Rather than striving for perfect accuracy, the most important thing is to first develop the habit of keeping records.

Q. Can this system be used by small teams?
Yes.
Regardless of team size, the idea of ​​combining behavioral data, subjective perceptions, and customer feedback can be applied at any scale.

Q. Should I contact a customer immediately if they show signs of churn?
Depending on the situation, overly blatant questioning can actually cause anxiety.
I recommend contacting them in a natural way to inquire about their situation.

Q. Is it possible to rebuild a relationship with a customer who has almost left?
If you notice the problem early and respond honestly, there is a good chance you can rebuild the relationship.
The longer you leave things unattended, the more difficult it becomes to turn them around.

Q. How accurate is Churn prediction?
Churn predictions only indicate trends and do not guarantee 100% accuracy.
Please use this solely as a tool to narrow down the customers who deserve your attention.

Q. How can we utilize data from customers who have already churn?
Keeping a record of the circumstances that led to customer defection provides valuable learning material to help identify similar patterns early on with other customers.

16. Summary

Customer churn often progresses quietly and gradually.
You cannot notice this change by looking only at behavioral data, only at intuition, or only at the timing of contract renewals.
By combining three axes—nurturing score, emotional temperature, and NPS—and creating an organizational system to detect signs of employee churn, we can transform the regret of "employees drifted away without us realizing it" into the outcome of "we noticed and were able to take action."

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Related article

・CRM design to reduce customer churn
・A "two-axis matrix" of nurturing score and emotional temperature
・Integrated management of NPS (Net Promoter Score) and emotional temperature
・Before spending a large budget on new customers
・How to eliminate reliance on individual sales personnel