Understanding how ‘healthy’ your customers are is vital for sustainable growth. It’s about more than just whether they’ve bought from you recently; it’s about predicting which customers are likely to stay loyal, advocate for your brand, or – crucially – churn. Measuring customer health effectively allows us to proactively address potential issues and maximise lifetime value. Many Australian SMEs overlook this, focusing solely on acquisition, which is far more expensive than retention.

So, how do we actually do it? There’s no single ‘magic number’, but a combination of indicators gives a robust picture. We recommend focusing on these key areas:

• Product Usage: How frequently and deeply are customers using your product or service? For software, this might be logins and feature adoption. For a retail business, it’s purchase frequency and average order value. Low usage is a strong churn indicator.
• Support Interactions: Are customers frequently contacting support with issues? While good support is essential, a high volume of requests from a single customer suggests they’re struggling. Analyse the *types* of issues too – are they usability problems, bugs, or simply needing help with basic features?
• Sentiment Analysis: What are customers saying about you online? Monitor social media, review sites, and even survey responses for positive, negative, or neutral sentiment. Tools can automate this, but don’t underestimate the value of manually reading feedback.
• Net Promoter Score (NPS): This simple question – “How likely are you to recommend us to a friend or colleague?” – provides a valuable benchmark. Segment your responses: promoters (9-10), passives (7-8), and detractors (0-6).

Don’t treat these as isolated metrics. We combine them into a scoring system – for example, assigning points based on usage frequency, support ticket volume, NPS score, and recent purchase activity. This creates a ‘health score’ for each customer, allowing us to segment them into categories like ‘at risk’, ‘needs attention’, and ‘loyal advocate’.

Regularly reviewing these scores – monthly is a good starting point – allows for timely intervention. For ‘at risk’ customers, this might involve a personalised email, a phone call, or a special offer. By proactively nurturing customer relationships based on data, we can significantly improve retention rates and drive sustainable growth into 2026 and beyond. The next step is to identify the data sources you already have and start building a simple scoring model.