5 Ways to Prevent Your SaaS Customers from Churning

OnlineSales.ai Blog

One of the most painful aspects of a SaaS product is the fast churn of its customer base. Customers tend to onboard easily, fail to adopt the product long enough to engage, and end the journey too quickly; this results in the SaaS business losing a lot of money while weakening its reputability.

In this blog, I’ll be recommending 5 ways that’ll prevent your loyal customers from calling it quits on your product.

Drive Engagement

You may have built an incredible SaaS product that does almost everything at a click of a button, but what’s the whole point of having a product which does not drive any value to your customers? A product is obviously only worthwhile if your customers engage with/use it!

Lincoln Murphy, a pioneer in Customer Success says – “Engagement is when your customer is realizing value from your SaaS.”

A customer who does not use your product will not keep paying for it. As simple as – you have bought yourself a Netflix subscription and nobody has been using it, you’d surely end up cancelling it!

Similarly, if your customers are not engaging with your product they will unsubscribe.

An analysis conducted by Bluenose clearly indicates that Usage/Engagement is the major contributor to churn.

   Drivers-of-Churn      Image Source

Keep a track of non-usage. In case there are continuous periods of non-usage, you must know what’s wrong and how to solve it.

One of the best ways is to start measuring engagement, by measuring the number of customers that log in. Then understand the frequency of logins, which features they explore the most and so on.

Start sending out engagement triggers through either emails or personal phone calls based on their logging patterns and features they do not use.

Additionally, send out short product explainer videos, setup FAQs on the website, conduct webinars, product conclaves etc.

Once you are able to get your customers to use your product, the likelihood of a churn is highly minimised.

Feature Perfect

More often than not many SaaS companies focus their synergies on adding features. Many believe that having 100 features will make their product superior to others in the market.

Check which 10 of the 100 features are truly adding value to your customer. The time, energy and money spent on building the other 90 should possibly be utilised towards upgrading the 10 that make the most impact.

Features that become part of a customer’s daily regime are the ones that will improve and further boost engagement. For example, the first thing most of us do each morning is to check our phones for emails, calls, messages etc. It’s habitual now.

Customers need to ideally become habituated to your product, and upgrading the quality of your key features is crucial. What we need to create here is a Habit Loop. (Diagram below).

Habit Loop

Habit-loopNir Eyal’s habit loop

Customer Service is the Key

Remember, your SaaS customer doesn’t only look to your product, but they continuously measure the service and support you provide.

Check which 10 of the 100 features are truly adding value to your customer. The time, energy and money spent on building the other 90 should possibly be utilised towards upgrading the 10 that make the most impact.

As mentioned in my previous blog – 5 Ways to Drive ROI with Customer Success, Great companies are focusing on mastering the ‘software’ part of Software as a Service, although, the new generation of great companies are recognising the need to emphasise on the ‘service’ implied in SaaS.

Every customer is different and so are his needs. Understanding what your customers want, acknowledging and addressing their concerns on time, helping them achieve their goals using your product, taking their valuable feedback and incorporating it into your product, are some of the best practices with which you can build an experience they will never forget.

Often, it’s due to the service you provide that a customer decides to continue sticking to your product.

Incentivise your Customer

Delighting your customers is another way to keep them hooked. I’m sure most of us will never push back for something that is free. A Recent example is the Amazon Prime services after a subscribed user finishes the 30-day free trial, he is given an offer to avail a yearly plan for 50% Off.

Columnist Peter Economy reports, “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.”

Also remember, a happy as well as an unhappy customer spreads the word.

How can you surprise your customers? What could you possibly give away that will delight them? I’m listing a few options here that you could choose from:

  • Early Bird access to new features
  • Free Subscription for a month
  • Beta access to upcoming features
  • Extra storage
  • Increase in number of user seats
  • Free support package

These are great business strategies to keep your customers glued and satisfied, without them having to look to another product.

Upsells and Cross-sells

Keep a watch and gauge for opportunities to either upsell or cross-sell. Selling to a new prospect is way tougher than selling to an existing customer.

The authors of the book – Marketing Metrics have compiled important data around selling to a new prospect when compared to an existing customer.

Image Source

The data above is shocking yet stark. Put yourself in your customers’ shoes and ask “I’m already doing business with this company and I trust them, so why go elsewhere to buy?” Hence, upsell and cross-sells are much easier to win and highly effective in boosting your company’s profits.

Also remember, a happy, as well as an unhappy customer, spreads the word.

The more use your customer derives out of your product, the more he binds himself to its vital features, and the faster and easier it solves his problem, the lesser are his chances of discontinuing.

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Adrian Gahlot
Business Growth Specialist at OnlineSales.ai | Digital Marketing Fanatic

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