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Predictive vs Reactive Selling: What’s The Best Way to Reduce Customer Churn?

Predictive selling enables you to anticipate and proactively present solutions to preempt problems in a business process. In this piece, we’ll dissect ways to adopt predictive selling and reactive selling to trigger sustainable growth in revenue for your business and reduce customer churn.

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Predictive selling enables you to anticipate and proactively present solutions to preempt problems in a business process. In this piece, we’ll dissect ways to adopt predictive selling and reactive selling to trigger sustainable growth in revenue for your business and reduce customer churn.


In the current era, marketing departments employ all manner of tactics to arouse curiosity and appeal to different sensibilities of the target market. Many organizations with subpar products and services tout the superiority of their products to drive sales, and oftentimes it pans out. However, at some point down the road, when such products are put to use, customers realize what a hunk of crap it is and that they've been coerced into buying a product they may not even need.

We get pissed when this happens, it feels like money wasted and worse with caveats that go “monies paid are non-refundable.” At this point, a lot of alienated customers go on a rampage sharing negative reviews against such businesses and nothing spreads faster than negative publicity.

Such entities gradually experience a sales downturn as more customers realize their sudden nightmares are caused by quirky bookkeeping software, or they've had to lose hard-earned money due to a fundamentally faulty trading service. Plugging holes in your offerings and responding to feedback from customers, whether negative or positive, is a great way to reduce customer churn. 

At any rate, there’s also a rather technical means to tamp down customers’ departure via predictive selling and reactive selling. Let’s elaborate on the meaning of these terms and figure out which is optimal for your business. 


Reactive selling vs. Predictive selling


Predictive Selling

Utilizing analytics to forecast a prospect's future actions and behaviour is known as predictive selling. What is relevant today might not be in six months or one year. Prospect priorities vary. Business problems are evolving. You can keep tabs on a dynamic buyer world with the proper predictive analytics mechanism, even as things shift.

The ability to more accurately predict a customer's future behaviour concerning purchase decisions, what they will buy and when they will buy, based on their historical purchase patterns will help you keep tabs on a dynamic buyer world with the proper predictive analytics mechanism even as things shift. 


What are the benefits of predictive selling?

Take a look at the following six advantages of predictive selling:

1. Customer retention

To minimize any revenue loss, businesses need to continually bring in new clients to replace the ones who leave. It can be quite expensive to gain new clients because the expense of doing so is typically more than the cost of retaining the present ones. By seeing indications of customer dissatisfaction and detecting which customer segments are most likely to quit, predictive analytics may reduce churn and increase customer retention in your client base. Companies can use this data to examine customer satisfaction trends and take the required steps to increase customer happiness while maintaining revenue levels.

2. Discover profitable customers

The consumers who spend the most and generate the most long-term profits for a company are crucial for marketers to find. Only predictive analytics can provide this degree of knowledge, enabling businesses to maximize their marketing budgets and concentrate their efforts on attracting consumers who will ultimately produce the greatest lifetime value.

3. Customer targeting

Your customer targeting is the best example of when predictive analytics may be useful. Let predictive analytics handle the grunt work so you can focus on developing a better understanding of your target market and what they are looking for in an offering. Nobody likes to open an email that has nothing to do with anything they want. 

4. Estimate production rates

Predictive analytics has many advantages in the manufacturing and production sectors. Businesses may predict stock levels and necessary production rates using predictive intelligence, and also estimate production failures based on historical data. They can utilize this information to avoid making the same mistakes in the future.

5. Secure a competitive advantage

What can predictive analytics do? It can provide you with access to already existing, useful knowledge. It simply has to be dug up. Utilizing the consumer information you have at your disposal will give you valuable details about why customers choose you over your rivals, highlighting distinctive selling aspects that you can then further market to increase leads.


Reactive Selling

When we pitch something to a consumer or potential customer, we do reactive selling. Afterwards, we wait for the customer to respond. We frequently adopt a reactive stance while dealing with our potential customers. Reactive sales strategies typically include waiting for customers to approach you and then formulating a sales process around their requirements.

You might picture a car dealership with a salesperson waiting for customers to trickle in while they are alone in their office. They wait patiently for the arrival of customers. The salesperson is prepared to respond to inquiries and direct clients toward choices. They are merely responding to the demands and desires of the clients.

Let's examine three ways you can leverage reactive selling to reduce customer churn:-

1. Be Vigilant: Keep an eye out for feedback on your social media pages and be sure to address every customer complaint and adjust your business strategy accordingly. Do this for all comments, regardless of how positive, negative, or helpful they are.  You can learn from this feedback and adapt your sales strategy, products, and more to your customers' needs.

For instance, let's imagine you discovered a customer's Twitter complaint regarding one of your items. You should respond to the customer rather than disregard their feedback. You should offer to resolve their issue in a polite manner.

Discover the issue, then present a reasonable solution. If you have caused something, such as sending a product that is defective, make careful efforts to apologize. You can express regret, propose to supply a replacement, and even reimburse the recipient for their shipping costs. You might even want to go so far as to give them a rebate on a future purchase as a token of your goodwill.

On the other hand, if a buyer simply dislikes your goods without any "legitimate" justification. Inform that you are constantly searching for ways to improve your company. And provide more to your clients while requesting their feedback. Your company will gain from this in two ways:


  • First of all, interactions like this can turn a dissatisfied consumer into a devoted one.

  • Second, it demonstrates to the rest of your Twitter followers that you value your clients and offer first-rate services. This is another great way to reduce customer churn. 


2. Take need-based decisions: When you sell reactively, there could be instances where your actions are motivated by an immediate need. You are responding quickly and effectively to a need, one pressing issue at a time, as opposed to preparing and acting proactively based on facts.

3. Flexibility: You must continue to be adaptable and fluid when marketing by reactive means. Although it seems obvious, it's crucial that you're willing to adapt and satisfy client demands. If you want to be an effective reactive seller, you'll need to master the skills of re-prioritization, time management, shifting tasks, and switching between priorities.

Despite being frequently viewed as a less successful sales strategy, reactive selling isn't always a sterile approach. In some circumstances, it's critical to respond as soon as a problem emerges; but, if you merely respond and never adapt to a changing landscape, your business may take a bad hit. 


Predictive selling Vs reactive selling: which is better?

Well, that's a tough one to call. In actuality, none trumps the other. Various circumstances demand different ways of marketing your products and services.

But here's a valid theory. The optimum strategy to reduce customer churn in a business is to make use of a mix of both proactive and reactive selling. From the preceding paragraphs, you’ll understand when to leverage data to anticipate the future needs of a client. While also keeping vigilant to respond quickly to spontaneous customer requirements. 


Related: Product selling vs solution selling: should you change your sales strategy?

Written by

Tobey C. Okafor

Internet Entrepreneur and Content Writer based in Lagos, Nigeria.

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