Avoiding Churn: Tips for SaaS Companies

By November 3, 2016 July 14th, 2017 SaaS

You’ve probably heard before how important it is to retain your customers. Not only are returning customers extremely targeted leads, they bring in a lot more business than new customers, and cost a heck of a lot less to keep around.

A SaaS company should stay focused on reducing their churn rate as much as possible. But how do you keep people from leaving your business? Here are some tips we think are helpful in keeping your customers engaged and invested.

  1. Make sure your customer is engaged

The number one reason for churn in the SaaS industry is that users aren’t using your product. It is essential that you are keeping your users engaged so that they are realizing the value of subscribing to your service and don’t feel like they are wasting money. New content, helpful add ons, and staying up to date with integrations and other partnerships should be at the forefront of your SaaS company’s development goals. If you don’t want them to hit the unsubscribe button, you need to make sure your product doesn’t get dry, and find ways to incorporate its use into your customer’s day to day life.

  1. Make sure your customer feels valued

Customer appreciation is a huge part of avoiding churn. 68% of customers say the reason they will leave a company is because they feel it doesn’t care about them. So how do you make sure that your customer feels valued? A great way is to reward them for their continued service with discounts and rewards. Instead of promoting a new-member discount, focus on creating a returning customers rewards point system. Also, make sure your customer service is top notch. Customers will feel ripped off if they don’t have a dependable customer service representative to help them when they run into issues with your product.

  1. Monitor the technical side of things

A lot of SaaS churn comes from nothing less than avoidable technical issues. Automatic payments accidentally get cancelled when people get new credit cards, people cancel for a period of time and then forget about your service, or people are added to the wrong list or not offered the right features for their situation. Monitoring credit card cancellations, subscriptions, and upgrades is an essential part of making sure customers are where they need to be and paying for what they should be. Don’t let carelessness lead to losing customers you don’t need to lose!

  1. Ask questions

Lastly, when you do lose customers, find out why. You have nothing to lose if you send out a quick email or survey to your old customer asking why they left and what you could have done differently. This GrooveHQ blogpost has a great template for this kind of exit survey email. While you’re at it, get feedback from your current customers as well so that you can resolve issues before they decide to leave your company. The best thing you can do is listen when your customers tell you what they want and need.

At the end of the day, avoiding churn is all about making the most of your customer experience so that they grow to trust and love your brand. Authenticity, sincerity, and great content is all you need to keep your customers happy and committed to your product.

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