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Every time you land a new customer, it’s a cause for celebration. It’s another reminder that your hard work developing, marketing, and selling your product or service is paying off. But what do you do when many of those hard-earned customers start to evaporate, some not too long after they appear?
Did you know that, on average, a Google Play app loses about 80 percent of its users within the first three days following installation? In fact, app retention rates across the board are dismal, with only about five percent of users still using an app after 30 days. One of the greatest challenges your company faces is how to reduce churn in SaaS.
Let’s look at some of the reasons churn happens and what you can do to reengage your customers and put your company in a much better position than it is right now.
SaaS Churn Reasons
The customer churn rate in SaaS is the industry’s chief nemesis, and it often happens for one reason: the customer onboarding process is too slow. That sluggishness leads to other frustrations and dissatisfactions that, if not addressed, can result in slower growth and decreased revenues.
A major challenge for SaaS providers is that there isn't one universal B2B customer churn solution, as each business has unique challenges it needs to overcome. Here are five ways your business can improve the customer onboarding process to reduce churn rate and expedite a customer’s first experienced success with your product.
1. Map The SaaS Customer Onboarding Journey.
The best way to find out why customers are canceling is to ask them—either directly or indirectly by identifying user touchpoints, benchmarks, accomplishments, and scheduled notifications which can help you visualize how users travel from point A to point B during the onboarding process.
Once you identify where and when a customer experiences their first time-to-value with your product, you can align your onboarding process to these customer success pathways. As you map out customer success journeys, outline how other users will discover similar solutions to solve their problems. The focus should be on ensuring each new customer learns how to use your product to achieve their goals more quickly.
2. Research, Research, Research
Marketing and sales departments know researching a company’s target audience is essential to success. You can do the same type of research to design your onboarding process. Giving customers a relevant solution from the get-go is much easier when you know beforehand the problems they’re trying to solve.
3. Set Realistic Goals and Expectations
In psychology, there’s a saying that unrealistic expectations are premeditated resentments. As people tend to pin their hopes for happiness on fulfilled expectations, it’s easy to see how not being straightforward about what your product can and cannot do can lead to disappointment.
To prevent a customer’s frustration and churn, make sure you know how they define success. Some want to improve communication between their CSMs and their customers, while others are looking to scale partnership operation, processes, and referral registration. When you guide customers directly to their personalized solutions during onboarding, you increase the likelihood for them to be satisfied with the outcomes and increase retention.
4. Create Milestones to Celebrate Incremental Progress
If you have customers with larger goals that will take longer to achieve, it can help to build steppingstones into their journey. One example is a progress bar that shows a customer how far they’ve traveled in setting up their account and how much closer they are to unlocking the full potential of your product. To ensure success, make each milestone easy and quick to attain and use celebratory language to convey a sense of accomplishment on the user’s part.
5. Test and Adjust The Onboarding Process as Needed
Testing and improving your onboarding process is an ongoing endeavor if you want to reduce SaaS churn. Talk to your customers, send out surveys, and speak with users directly on a regular basis to develop a continuous feedback loop that helps ensure you create an onboarding experience that works well from day one.
Automate Customer Onboarding and Reduce Churn
All good onboarding focuses on helping customers achieve their unique “Aha!” moments quickly. Automating the customer onboarding process is a sustainable strategy that enables you to reduce SaaS churn rates, grow your business, keep your team focused on what matters and develop long-lasting customer relationships.