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Spotify managed to reduce its churn rate to just 5.1% in 2017 by offering an excellent customer experience through curated playlists and personalized recommendations. This strategy helped retain customers. Additionally, Spotify offered customers the option to downgrade to a cheaper plan, which is a proactive approach to prevent churn by accommodating customers who might leave due to cost concerns. The company also scaled its customer support as its customer base grew, ensuring high-quality service. Furthermore, Spotify allowed artists to sell merchandise without taking a fee, which increased artist and customer loyalty to the platform.
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Spotify grew to 140 million active users and 70 million subscribers in less than ten years while simultaneously reducing churn to just 5.1% in 2017.It offered an excellent Customer Experience (Path1) through curated playlists and personalized recommendations to make customers stay. Interestingly, Spotify offers customers the ability to "downgrade" to a cheaper plan. While this may sound counterintuitive, it's an effective strategy to prevent churn by getting ahead of customers who might leave because they wish to pay less. The company has an extraordinary focus on scaling its excellent customer support along with its growing customer base. Spotify allows Artists to sell merchandise without taking a fee to increase artist and customer loyalty to the platform.
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How do you find the right strategy to grow your organization in a rapidly changing business environment? "Growth IQ" distills decades of tested strate...
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