AI is driving up churn all across the board. Why? In many cases, it’s not because vendors fail their customers, or that the solution wasn’t good enough. In previous years, customers might have just renewed out of intertia. But things are different now.
Today churn is often simply because looking at how AI changes a category … put the customer / renewal into play.
- Sometimes, there is AI innovation budget fueling change.
- Sometimes, it’s a corporate initiative pushing folks to look at AI solutions to cut costs and drive innovation.
- Sometimes, it’s just curiosity.
But a lot more deals now are being put into play simply because customers that aren’t deeply unhappy are in some cases, for the first time in years, looking to see what AI can bring to the table.
You have to be ahead of this:
- You have to make sure you have at least some sort of “AI Parity” with the next generation, if your aren’t the next generation.
- If you do lose a few key customers due to AI-related churn, Be Kind. Because I’m already seeing a number go back a year out or less to their original vendor. Boomerangs are already happening where AI vendors overpromised 6-10 months ago. Burn them on the way out — and they won’t boomerang back.
- Move faster on the product development side. This is easier to say, but you just have to. AI is getting better and better literally every week.
AI is driving buyers to look at their vendors and tech stack anew. Even if they don’t churn today, they may be thinking about it. Not because there are issues, but because you aren’t top of mind as the AI vendor here of the future.
Be that vendor.
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