Have you ever tried to fill a bucket full of holes with water? It’s pretty tough, right?! The water you pour in the top, just pours out the bottom. You keep working hard to get the water level up, but those holes are just too damned big. At this rate you’re never going to fill that bucket to the top.
There are only two options left, you can either:
- Become Chuck Norris and watch the bucket fill itself. You can now, after all, empty a swimming pool of water with a fork in the rain - surely a leaky bucket is no problem!
- Plug some of those holes and slow down the rate at which the water is being lost from said bucket.
Now, imagine the bucket is the monthly retained revenue for your SaaS business. That leaking water is all the revenue you’re losing when customers cancel their subscription to your service. Many people talk about sales and marketing with their eyes firmly focused on the term “NEW BUSINESS”. However, the churn rate for SaaS organisations is a surprisingly rich area of opportunity. It is a well documented, highly lucrative, and easy to target market that you might not be spending your time on. I’m talking about your existing customers!
Those are some impressive numbers for simply reducing the rate at which your client base is turning over. There’s a reason why this small reduction in SaaS churn rate has such a dramatic impact on your profitability. Industry research shows that it requires 5 x the investment to generate a new client over retaining your existing ones.
How do you reduce the churn?
I’ll be upfront, you are not going to retain every customer you have. Life simply doesn’t work like that. The best thing you can do is be conscious of your new client and their needs when you are writing your post-sale marketing strategy. You should have a plan in place to delight them from the very first interaction with your business, right through to the point they have chosen to buy, and beyond.
This mentality of delighting your prospects and clients from the very start, is one that’s very well adopted by successful SaaS companies. Now, I’m not saying you have to bend over backward to fulfill your client’s every whim, but you do need to apply the same level of buyer persona focused need evaluation into the onboarding and ongoing services aspect of the client’s lifetime.
Once you have solved the original problem it’s NOT the time to sit back and get complacent. There are several other touchpoints that can give you the opportunity to further deepen your relationship and value to the client.
Here are a few we have in place when we start working with a new client:
- HubSpot technical onboarding
- HubSpot end-user training
- Providing jargon-free updates
- User group events
- User Manuals
- NPS Surveys
Each of these six touchpoints gives us with a chance to add value to the service we are providing, whether it’s direct with the decision-maker, or with members of the wider team. Our client retention rate is a very healthy one as a result.
Yet, none of these touchpoints are delivered without it being part of our strategic GamePlan to grow Klood into a bigger and better agency. The GamePlan provides us with documented strategic goals, buyer journeys, content requirements and the high-level view required to take action.
Here is a list of some other activities to consider. - https://blog.hubspot.com/service/customer-touchpoints
Why is a GamePlan required?
A GamePlan is a definite requirement at this stage of your buyers/prospects’ lifecycle. The time when a client is most likely to get disgruntled and leave is within the first stages of solution ownership. This happens for a few reasons, typically bad service delivery is top of the pops when it comes to leaving, but you can also overdo it.
Taking this strategic approach, with the right checks and measures in place, will allow you to mitigate the risks of clients leaving during the crucial onboarding phase and improve your client relationships. This then extends to the other known touchpoints in the client lifecycle.
As a SaaS business, you are armed with tons of data that can help you in this endeavour. You can access information such as:
- Last logins
- Company adoption
- Tickets raised
If you dig into this data you can start identifying trends that are typical of a client on the way out, and then deliver training, offers or guidance that stops the wayward client leaving. What data you need and how you will deliver a program of retention will need to be documented, managed and measured. This is why you need a GamePlan to help you retain clients. It will help you smash your growth, increase your business profitability, and as a beautiful little side effect, all those delighted customers will give you a ton of free endorsements when they sing your praises to their peers! Unless your Chuck Norris of course, in which case your clients probably raise their children with the sole purpose of becoming his future clients. Such is the power of Chuck Norris.