Last updated on January 17th, 2023
Retaining a customer is more advantageous than acquiring a new one, irrespective of the business you are into. It has often been proven, and there’s absolutely no doubt about it. When a customer becomes your loyal customer, they may stay on your website to subscribe to more services or buy new products. They may also upgrade their services over the period if they find your services satisfactory. If you’re running a SaaS company, you must have experienced customers getting churned. Businesses need help to prevent churn from happening and retain their customers for extended periods. But some proven strategies can make the job easier for them.
Customer retention is one of the issues that many Software-as-a-Service (or SaaS) businesses face these days. They develop strategies that can help them reduce the customer churn rate and retain their customer base.
Primarily, it always remains the point of focus for SaaS businesses to retain customers. They have to look at their sales funnel and, from onboarding to the retention process, find ways to maximize customer acquisition rate and minimize the customer churn rate.
So, here we are to help all those businesses with their customer retention issues.
Follow These Tips and Increase Your Customer Retention Rate
01. KPI Monitoring
The first tip for you all—the SaaS business community is to monitor the important KPIs constantly.
The Important KPIs Regarding Customer Retention Are:
- Churn rate
- Customer acquisition rate
- Monthly recurring revenue (MRR)
- Annual recurring revenue (ARR)
Things become pretty simple when you do KPI monitoring for customer retention management. Consider this scenario when you monitor the churn rate; you will know who is leaving. However, moving one step ahead, you can see the reason. And that is one step towards getting customer data insights.
From customer onboarding to customer subscription cancellation, monitor the customer data so that you can identify why customers are canceling their subscriptions. When the reason is identified, you just need a workable strategy to control the customer churn rate.
Coming toward the recurring revenue. In SaaS subscription businesses, you must also keep an eye on revenue. Some enterprises have monitored not only the monthly recurring revenue but also the weekly and average per-person revenue. This monitoring helps in identifying revenue leaks. But, again, the data monitoring shows the causes of revenue leaks.
02. Customer Experience
The next thing that SaaS businesses need to pay attention to is customer experience. And for that, you need your customer care and support services on their toes. Make sure that your support and customer care representatives are all available and all-time available for the best customer experience. Trust this!
Better customer care services play a hiring role in retaining customers. Just consider the scenario in which a customer is stuck somewhere and having a technical issue. They contact the customer care rep, but your support teams are too busy to tend to him. Such customers who are still waiting to hear a response from customer care or the support side, might cancel subscriptions.
So, one of the tips you need to consider is to pay attention to the customer experience.
03. Apposite Add-Ons
SaaS companies not only need to pay attention to the core business but also need to keep the research on the SaaS product ongoing. And for that, you need customer data insights. To know the customers’ activities, you must pay attention to customer data. That way, you will know what the customer wants.
And when you know what the customer wants, you will come up with the add-ons and advanced versions. So opt for retention management solutions to accommodate apt add-ons. Also, you will need to market the add-ons and new versions of your SaaS product.
04. Communication With The Customers
The next tip for you is to keep communicating with not just one but the entire customer base. Not just customer care, but you must always communicate with the customer. You can make a customer communication schedule and decide the date and time for communicating with customers.
Tell your customers the upcoming features or versions you will introduce. Finally, you can use email marketing and in-app messages to communicate with your customers. These messages and emails not only bring customers into the loop but also helps in improving the brand name.
05. Customer Loyalty Programs
Curate exciting customer loyalty programs. Come up with subscription boxes that are irresistible for customers. Whenever top customer loyalty strategies are created, customer loyalty programs become part of it. Offer your loyal customers discounts, offers, and coupons.
Also, if some of your customers are dormant, offer them these loyalty programs. They will help you in retaining your customers. You can also market these customer loyalty programs.
06. Make Use of Social Proof
A potent tool that can improve customer retention is social proof. Showcase positive customer feedback and testimonials on your website and in your marketing materials to reassure prospective buyers that other people are enjoying your product. In addition, a professional logo is required to give your website a professional appearance. You can create a logo for this purpose by using the Designhill logo maker tool.
07. Difficult To Replace
You need to make your brand difficult to replace or almost irreplaceable. And to make it difficult, the customer experience is the most important thing. Also, the product value matters. You must ensure that your product is fulfilling enough for customers so that customer satisfaction remains maximum. When the product is irreplaceable, the retention rate will show you a boost.
08. Customer Segmentation
Customer segmentation can also help in retaining the customer base. How? You just need to monitor the customer activities. You need to implement a customer engagement strategy when you notice customer activity falling. However, you can also go for the implementation of account expansion strategies for the customers who are loyal to your brand.
Convince them to try the new version of your SaaS product or opt for the add-ons. When customers are segmented, things are pretty streamlined for you. You know what to spend and where to spend to maximize the ROI. Also, customer segmentation plays a vital role in keeping customers satisfied.
09. Use Word of Mouth
Studies have proved that customers (these days) do not get convinced about your products or services just because of your marketing strategies and sales tactics. Instead, they believe in reviews and word of mouth. They want to listen to the customers who have already tried your products or services.
So, working on the product value can also be an option for you so that the customers will talk about your SaaS product. As a result, more customers will want to know about your product when they talk about it. And that the opinions and reviews are called word of mouth. And people easily believe it.
So, you will also need to focus on your product value and customers’ opinions about your product.
10. Offer Refund Policy
When we say retention, customer experience is the key, and refund policy plays a significant role. When the return policy is unclear, the customers who have bad experiences with that can easily spread negative reviews about your platform, and you do not want that. So, make a refund policy very clear from the beginning.
When you keep refund policies, there can be two scenarios. The customer can exploit you, or having the best experience will make him leave the best comments about your business. So, the refund policy offers you good branding, the best customer relations, and the best retention rate as well.
11. Customer Feedback Loop
The most important thing that any SaaS business must not neglect is the loop of getting customer feedback. You need to ensure that you not only get customer feedback but also consider it seriously. Customer feedback tells you what the customer wants and what add-ons you need to work on.
It will help you improve customer relations and increase the flow of revenue because that way, recurring revenue diversifies. The customer feedback also tells you if there are needed improvements in your SaaS product. So, it benefits your business.
12. Customer Communication Calendar
When we tell you to communicate with the customers, it is better to do it with a plan. And take your plan to the calendar so you will precisely know when to send messages and calls to your customers and what to tell them. When things are streamlined, it becomes easier for you to convince customers to cross-sell and upsell.
Communication is the key to good customer relations. And it is better to prepare your sales and customer care representatives for that. Also, you must communicate with not only inactive customers but with active customers as well.
13. Customer Education Program
If you plan and start a customer education plan, things can be very clear for you and your customers. Your education plan will guide your customers about using your SaaS platform. Some SaaS platforms are quite complicated to use. So, it is better to tell your customers how to use your platform. It will save the resources you otherwise spend on customer care and support.
For customer education, you can go for in-app messages and popups. Other than that, offer training sessions. It will not only satisfy customers but also increase your product value.
Now you know how important it is to retain customers for your business growth and what strategies will work well to achieve your goal, especially when you’re into SaaS business. If you are looking for a SaaS platform to help you implement your customer retention strategy, then SubscriptionFlow is the one. Here, you can track customer data from the very first interaction with the customer. And when you have such detailed datasets, getting useful business insights is easy. These business insights help in onboarding a loyal customer base and retention as well.