High-growth businesses offering software-as-a-service (SaaS) to customers are focused on keeping this one important metric down: customer churn. This term refers to the percentage of customers that cancel or unsubscribe their use of your service over a certain period.
If you’re scaling up your SaaS business, you’ll need to zero in on this important metric. You’ll want to keep your customer churn rate at a manageable level, as this can affect the bottom line and the growth of your business.
Here are six ways to reduce your company’s SaaS customer churn:
Improve Your Onboarding
Although providing free trials don’t contribute to the monthly revenues of your organization, it can help boost your onboarding rates. The purpose of offering free stuff is to attract customers and then communicate the benefits of using your service.
When a customer signs up for a free trial, make sure that your onboarding process enables customers to experience the long-term benefits of what you have to offer. This will make them more likely to convert to permanent customers – and hopefully into active ambassadors of your brand.
Here are a few ways to enhance your onboarding flow:
- Use a reliable customer onboarding platform to help you get your customers up to speed with your service and its advantages.
- Keep things simple for your customers. Avoid presenting users with too many details and features at the start.
- Communicate the benefits and value proposition of your service effectively by optimizing your user experience (UX) copy and brand messaging.
Focus on Customers at Risk of Churning
Customers who are likely to cancel their subscriptions are an important segment of your business. You could retain them – and even get them to sign up to your other SaaS services – if you solve their problems proactively.
You can identify at-risk users by using a platform that gathers data about the usage of your services. The data that you’ve collected can show activity patterns that indicate whether a user is likely to stay or cancel their subscription.
Another method of identifying at-risk customers is to thoroughly define your target buyer personas and customer profiles by business size, demographic, industry and more. This lets you determine the segments with the lowest and highest churn rates. Give this information to your sales professionals who could get in touch with users on the brink of canceling their SaaS subscription.
Create a Frequently Asked Questions (FAQ) Page or a Knowledge Hub
An FAQ page and a knowledge hub are two ways to bring down customer churn for your organization. A report from eConsultancy revealed that 83 percent of customers expect some form of assistance during their online shopping journey. What’s more, 51 percent of respondents prefer obtaining the help they need from a knowledge base or an FAQ page.
If your business isn’t providing users with a well-written and up-to-date hub or page, you’re practically turning off customers from the get-go. Customers who have a good grasp of your service’s benefits are less likely to abandon your business.
When creating a knowledge hub or FAQ page, you need to meet the following criteria:
- The page should be easy to understand and straight to the point
- The hub must offer step-by-step guides or in-depth answers for using a specific SaaS feature
- The page should include links for further reading or information
Provide Value-Added Elements to Customers
Minimizing churn and improving customer satisfaction go hand in hand. An effective way to boost user satisfaction is to give them more for their money.
Think about offering added-value elements that won’t cost your company a lot of money. You don’t necessarily need to provide service features for free or run promotions every month. Instead, offer free video tutorials on how to properly use your service.
Cut Down Customer Response Time
When users reach out to you via email or social media, don’t leave them on “read” for too long. If you fail to respond or engage in a timely manner, they’re more likely to cancel their subscription and take their business elsewhere – particularly to companies with responsive customer care representatives.
When you receive a customer inquiry or help ticket, you need to address this within 24 hours.
Develop a Winback Strategy
Some customers cancel their subscriptions out of the blue. You’ll want to learn the reasons behind their exit.
You can proactively obtain the information you need by adding a survey to your cancellation process. Once you know why they decided to stop their subscription, you can use this info to see if you could win them back. Acting on their suggestions may just be your ticket to converting a former customer to a returning user.
If your platform is currently experiencing a high churn rate, don’t fret. Take note of these six actionable tactics to stop customer cancellations that hurt your bottom line.
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