How To Lower Your SaaS Customer Churn
Customer churn can significantly impact SaaS businesses and cause inflation in their recurring revenue. A recent study by Accenture Strategy stated that âEnterprise SaaS companies lose $1.6 trillion per year due to customer churn!â
A customerâs usage rate declining is typically a sign that churn is about to occur. However, there are different usage metrics, such as total users, user log-ins, time spent using the product, etc. Churn is typically the next step if you see that a customerâs usage pattern has significantly changed. You should always know if your customers change how they interact with your product if they switch from one feature to another.
Customer Interaction Level
The level of customer interaction generally declines due to a decrease in product usage or perceived value. Customers no longer see the benefit of calling you to solve their problems. If you notice a drop from an average of eight support calls per month to just one or previously reliable customers who missed two or three consecutive payments, it should cause concern.
When customers downgrade to a lower-tier plan, it may signify a downgrade in the product, which lowers MRR and raises the possibility of customer churn. Customer churn can happen due to a customerâs price sensitivity or misalignment of the value proposition.
Seven Strategies To Lower Your SaaS Customer Churn.
Enterprise SaaS companies must ensure that their relationships with current customers improve over time. It will help reduce customer churn and re-engage customers who have left or are about to leave.
Letâs dive right into the strategies!
Offer Effortless Customer Onboarding
It is crucial to offer customers an effortless customer onboarding. Customers are more likely to use your product or service more frequently if you make an excellent first impression. Considering that a customer will remember the impression you left after paying you with their hard-earned money. Also, every subsequent interaction with them will be influenced by how you treated them when they made that commitment.
Define Roadmap For Customers
Having personalized customer onboarding specific to your business is a blessing in disguise. This strategy gives you total control over the rate at which youâre surfacing more information while making it simpler to manage customer expectations. Defining a roadmap to walk the potential customer through the features, functionality, and operation of your product or service can help make the transition easier. Customers are less likely to leave your company if they feel empowered to succeed through your guidance. So you must constantly review and improve your onboarding process and continue to help your customers overcome hurdles.
Increase Customer Engagement
Increased customer engagement will help SaaS enterprises lower their customer churn by putting the right strategy in place and focusing on customer satisfaction. Having an engagement strategy that is simple to implement and regularly informing customers about the benefits of your product or service will help to increase customer engagement and foster long-lasting relationships. You can accomplish this with blogs, newsletters, videos, and other platforms using personalized, product-focused content.
Segment Customer feedback
Every customer is unique and has specific challenges to overcome. So their preferred approaches to overcoming them have to be unique too. Segmenting your customers based on the challenges they tell you about, how they use your services, and what content they read the most helps to show them youâre paying attention. This strategy will encourage customers to refrain from churning and be with you for a long time.
Prioritize Proactive Customer Service
Prioritizing proactive customer service may help you identify issues you were unaware of while onboarding your customers and help you provide the necessary solutions. A bad customer experience can be a significant factor in why customers stop doing business with you, so having an effective customer success strategy is essential for SaaS enterprises. Your customer needs to have an exceptional and memorable experience to recognize the value of your product and remain loyal.
Create A Community Around Your Product
In our very nature, we have a solid desire to fit in. People enjoy having a sense of belonging or being part of a community. You can lower customer churn rate by educating and involving users in online communities. A community provides a platform for customers to actively and frequently engage with each other and share knowledge while allowing you to make your customers feel like they are a part of your brand.
Offer Dedicated Account Managers.
SaaS enterprises can enhance customer retention efforts, boost customer retention rate (CRR), and raise customer lifetime value (CLV) by offering a dedicated account manager for prominent customers. Customers are more likely to stick around when they feel like they know someone at the business personally. Assigning someone sole responsibility for a particular client can be an effective retention strategy.
Hold Regular 1:1 Success Calls And Send NPS Surveys
Retaining customers can be a hectic process. However, you must make an effort to schedule regular 1-on-1 success calls with your clients and monitor their Net Promoter Score (NPS) to learn what aspects of your products are liked and disliked by your customers. These will allow you to find out how and why they use your services and what difficulties they encounter. These will help you strategize your next move and create an effective customer success strategy.
You will lose a significant chunk of your annual recurring revenue if a customer decides they no longer want to use your products and services. It will cost you money and time, and finding a new client may take months.
Check this blog to know more about SaaS Customer Churn:Â https://www.cognisaas.com/blog/strategies-to-reduce-customer-churn
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