How’s the churn rate looking in your SaaS?

For most, churn is a metric for considerable concern. You work hard to bring new customers onboard, so you want to see return on that investment by having customers who stick around with you.

It takes some effort on the part of SaaS to hold good retention rates. Signing up to a plan does not mean the customer will stick around when leaving is as easy as hitting a “cancel” button.

This is where SaaS need to look for ways in which they can create loyalty among their customers. A customer who feels nurtured by your company and generally looked after is more likely to stay and possibly even become an advocate for your brand.

Here are some strategies SaaS can implement to foster loyalty:

#1. Take Feedback Onboard

Statistic: 97% of consumers said they are somewhat likely to become more loyal to a company that implements their feedback. (Apptentive)

Listening to and implementing customer feedback should always be a priority if you want to grow your SaaS and truly look after the needs of the customer.

This does not mean you should be rushing to produce every single feature request — you still need to weigh up the goals of the business and the customer you wish to serve first. However, think about it this way; what support requests are you getting frequently? Are there common questions or irritations with how a feature works? All SaaS should treat the collection, organization and prioritization of customer feedback as a priority.

This might mean putting out new training materials. It might mean sending out a quick explainer email. It definitely means finding ways to proactively seek customer feedback and taking a broader focus on customer success.

Bridging Customer Support and Product Development

Your Customer Support team tends to the the frontline of eyes and ears when it comes to customer feedback. The challenge for SaaS who have a product development team independent from Customer Support is to ensure that there are no barriers to communication between the two.

UserVoice wrote about the importance of keeping Customer Support and Product Development in sync: “as many teams have discovered, bridging the gap between Product and Support is actually really difficult.” They interviewed Mercer Smith-Looper about how her team has made bridging the gap work at Wistia. In their case, by using designated “Customer Champions” who can reach out to a “Dev on Point” to address or escalate issues.

Require Feedback from Churning Customers

Many SaaS don’t really have a mechanism in place to gather feedback when the customer does hit “cancel.”Seth Banks of Subimage discussed the good and bad of requiring feedback from cancelling customers in a blog post. Where they used to have optional feedback for cancelling customers, they decided to make it a required field.

Sometimes they got feedback which was less than helpful from annoyed customers, but they get enough helpful feedback for it to make sense to have feedback as a requirement. They use that feedback to stay on top of development priorities. Sometimes they even manage to get the customer back as a result of addressing the feedback.

Which SaaS do customer rewards well? Check out our free guide:

#2. Keep Them Interested

Statistic: “80% of shoppers would switch stores or brands when offered a compelling promotion.” (MarketTrack)

You might think it’s too inconvenient or that your customers are too loyal to switch, but it really is that easy, even for SaaS. This means that the line “always be selling” holds true, even when you’ve already got the customer signed up.

Here’s how Venturebeat puts it:

“SaaS companies are literally always selling, because they have to keep the customer from hitting the cancel button each month. That means they always have to provide value for their customers, which is a huge departure from traditional vendors that will just stay on-premises until they’re ripped out.”

This doesn’t necessarily mean a “promotion” is the way to go, but there are other things you can be doing so that the customer feels like they are getting so much value from you that they’re really not interested in switching.

“Value” should include an exceptional customer service experience with personalized attention where needed. Customers don’t connect with the SaaS, but they do connect with the human faces of it. Use names, talk about your team and who they really are and address your customers personally where they need help.

When you think about it, is it easier to hit cancel on “Random SaaS Name”, or to cancel on “Annie” who has gone above and beyond to provide them with a good service?

Value should also include a focus on customer success. Know what your customers’ goals are and what success will look like to them. Map out their journey with your SaaS and identify those success milestones which they need to reach. The value part comes in when you help them get there…

#3. Rewards and Surprises

Everyone tends to enjoy the good kind of surprise and your SaaS customers are no different. Of course, rewards are by no means a compulsory component of successful SaaS, but they sure do help with keeping people interested and fostering their loyalty.

It’s about channeling that “surprise and delight” element at the right times for your customer. For example, you might choose to reward them for their loyalty at certain milestones by:

  • Offering a free upgrade.
  • Giving them an “extra” in features such as more storage or a feature they couldn’t access before.
  • Offer a discount for sticking with you for a longer period.
  • Surprise with a gift of some kind.

As Inc. columnist Peter Economy puts it, “think customer surprise.” If you remember that feeling of anticipation and delight as a kid when you opened up a cereal box with a prize, this is the kind of response you can evoke from your clients when you do something for them.  “The secret to delivering great customer service is to give your customers a surprise–something they didn’t expect. It’s those unexpected experiences that leave customers with a story they are eager to tell.”


What kind of surprise would your customers appreciate?

#4. Educate Employees

Statistic: “25% of employers have seen an increase in customer loyalty after increasing employee educational requirements.” (Career Builder)

This is not specifically a SaaS statistic but it makes sense that better-educated employees will be able to provide your customers with a better service experience. Make sure your customer service people have the tools and training they need to provide excellent service every time they interact with your customers.

Give employees discretion to solve problems and create a process for them to escalate any issues. Make sure this includes that a customer never has to repeat themselves to someone else! This is a huge irritation and can contribute to feelings of a poor service experience.

“81% of consumers admit that it is frustrating dealing with a company that does not make it easy to do business with them.” (Accenture).

Get examples of SaaS rewards done well. See our free guide here:

Final Thoughts

If your SaaS wants to keep churn to a minimum and retain customers, you need to work on strategies which will develop loyalty toward your business. You won’t keep everyone (customers can be fickle like that!), but you will be able to impress sufficient numbers who will want to stay with your excellent service.

Adopt the “always be selling” mantra and find new ways to surprise, delight or boost the customer experience. Make it so your customers would feel bad about leaving…

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