When it comes to customer relationship management, the churn rate of any business is an important indicator of health. In the case of the B2B marketing and sales process, and especially Software as a Service (SaaS) companies, reducing churn is a priority.With the improved access to information, “customers are more transient, and it is easier and less costly for them to switch between competitors,” says Fred Wiersema, from Pennsylvania State University.
B2B customers are fewer in numbers but make larger, more expensive and more frequent purchases.
“If a customer regularly uses your product, you have nothing to worry about. If on the other hand, the customer’s usage level drops off, you need to find out why it dropped and what to do about it.”
For instance, rather than looking at churn alone, HubSpot created an App Usage Index, to measure the degree to which customers practice inbound marketing, and monitor how many different tools on the app the customer is using.
Rather than looking just at churn, they calculate:
How frequently customers blog and track leads through the software.
Whether they run email and conversion campaigns.
Whether they engage in social media..
And much more.
Since customer engagement is the first predictor of retention, it’s important to measure it. These numbers and figures can help you get to know your ideal buyer persona, so you can not only target the best potential customers but those who have the best potential lifetime value.
"So, get the good customers in – the ones who’ll be profitable and stick around a long time – and work to keep the bad customers out, and many of your churn problems will get resolved before they’re actually churn problems."
We're not just talking about looking at your marketing dashboard, CRM or business intelligence tool. Try looking at their social media!
2. Detect significant patterns
Your stats can give you early warnings of people risking leaving your product or signing out of your service. For instance HubSpot assign Inbound Marketing consultants to help implement the software and work for them during their onboarding period.
"Regardless of age or experience, each customer receives a personalized monthly account review, the goal of which is to help them get as much out of their subscription as possible."
3. Remind (or improve) the value of your proposal
Software as a Service companies often consider that their value lies only on the software itself. If the client can find a similar software at a lower price, so be it.
So, you need to use all the tools at your disposal to remind existing customers what is the value behind your software, beyond the algorithms. Rather, how does it make their lives better?
4. Delight customers
This sounds like marriage counseling.
The same goes for a customer that shows signals of losing engagement. Remind yourself, using data analytics and your CRM host, what appealed that customer in the first place?
Imagine the picture: you have a recurring software glitch. You turn to customer service, and after running some diagnostics and fixing a bug, the company representative closes with “I’m done. Good day”. You don’t hear from them until you have the same glitch. Is that customer care? Follow up!
That is why HubSpot recommends using what it calls “the three pillars of delight”:
Innovation: change is better than status quo. Therefore, innovate to serve people with the right products.
Communication: personal is better than impersonal. So, communicate to help people.
Education: empowering is better than ignoring. So, educate people to grow their knowledge.
Your company must use the benefits of social monitoring as a listening tool! Data improves how you execute these pillars, and helps you pay attention both to verbal and nonverbal communication to follow up and solve problems on time.
Most SaaS are subscription based models. A customer may choose one product from your suite at a basic level. Is that enough for him. Even more, is that enough for you?
There is so much more that you can offer! Upselling helps you improve your relationship with your customers on a more in-depth level. As their company grows, so does their requirements. They may need a larger storage capacity, more advanced capabilities or an extended coverage. Make sure you can grow with them, before they turn to other options.
Reducing churn. Are you a software or a service?
This is complicated.
But Neil Patel asks the question: “why is it that your customers pay you every month? Because you’re serving them."
Can they see that?
Can they feel that?
Do they know that?
"If you can provide service in tangible ways, you will become vastly more successful at retaining customers.”
What’s your current company’s customer churn rate? How are you addressing it?
Inbound Marketing & Sales Enablement Consultant, HubSpot User Group Leader, HubSpot Platinum Partner