May 11, 2019

Engage On Social Media

3. Retention  >  Engage Customers On Social Media

Engage customers on social media to reduce SaaS churn

Utilize the power of social media to build a powerful relationship with your customers. Engaging with customers on social media is a perfect approach to reducing churn and creating loyal customers.

● PERSUASION

Salesforce

Salesforce is actively involved in social listening and responds to customer query right away on Twitter.

Hubspot

HubSpot posts relevant content on LinkedIn to engage with its ideal customers.

Grammarly

Grammarly publishes relevant quotes on its Facebook account for engagement with average likes over 2K per post.

How to use the technique

  • Use buyer personas to choose appropriate social platforms. Be on social networks where your ideal customers are. If your ideal customers only use Instagram, be on Instagram. Grab our free churn optimization framework to find out more. 
  • Socialize. Social media is all about socializing. Focus on long-term growth. Engage customers by building a relationship with them.
  • Be active on social networks. Have a social media manager handle your accounts. Respond to customer messages, queries, feedback, and mentions without any delay.
  • Offer customer support on social media. This is what customers expect. They use social media to interact and engage with their favorite brands. Use chatbots to respond quickly to common customer queries.
  • Publish informative and interesting content regularly. Use a scheduling app. Publish fresh posts on a daily basis. Avoid promotional content.
  • Publish video content. Videos are far more engaging than images and text. Post high quality informative videos on social networks for engagement and reducing churn.
  • Get feedback for improvement. Collect data from customers who accept the upsell offer and those who don’t. Use feedback for improving your offer, pitch, and other issues. Focus on conversion optimization. Get access to our free churn optimization framework on conversion optimization.

Mistakes to avoid

  • Publishing promotional content. It’s OK to promote your app and features every now and then but using social media solely for the purpose of selling won’t work.
  • Poor social listening. Not monitoring brand mentions, customer feedback, and not participating in discussions will impact your business negatively. Active social listening is the recommended approach.

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Research evidence

According to Sprout Social Index, social media is the top choice of consumers for customer support. When a brand connects with its consumers on social media, 70% of people are more likely to use that brand’s products, 65% of people said that it increases their loyalty with the brand, and 75% of consumers are more likely to share a positive experience with the brand on their profile. That’s how crucial social media is for any SaaS business.

70%

70% of customers that have been engaged on social platforms are more likely to use that brand's products again in the future.


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May 11, 2019

Upsell Higher Plans

3. Retention  >  Upsell Higher Plans

Upsell higher plans to reduce SaaS churn

Selling to existing customers is easier and cost-effective. Upselling higher plans and upgrades to current customers is the best technique to increase revenue, retention, and revenue – and it helps you reduce churn because customers who upgrade are more likely to stay.

● PERSUASION

Qualaroo

15Five

CloudApp

How to use the technique

  • Use customer history for offering upsells. For instance, sending an upsell offer when a customer completes a milestone or when a customer refers your product to a friend. Use data and behavioral analysis for pitching upsell offers at the right time. We have crafted this amazing free churn optimization framework. where you can find more details.
  • Send emails with upsell offers. Again, use segmentation to send upgrade offers to appropriate customers. Add prominent CTA, highlight benefits of the upgrade, and share customer testimonials.
  • Use in-app upsell notifications. This works great for reducing churn and improving engagement. You can lock advanced features, notify customers to upgrade so they can unlock them.
  • Offer a free trial of the upgraded version. Upgrading plan for free is a great way to retain customers. Let customers explore the upgraded version and once they get value from it, they will switch to it.
  • Share the benefits of the upsell. Make it appealing. Use emotional triggers. Share testimonials. Show how they will get value.
  • Get feedback for improvement. Collect data from customers who accept the upsell offer and those who don’t. Use feedback for improving your offer, pitch, and other issues. Focus on conversion optimization. Get access to our free churn optimization framework on conversion optimization.

Mistakes to avoid

  • Upselling to unhappy customers will make them churn. Don’t do it. Use data for upselling and only target happy customers.
  • Upselling at the wrong time. Upselling to a customer who has an open ticket with customer support isn’t a good idea. Choose an appropriate time for pitching the upsell to boost conversions.

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Research evidence

A survey conducted by Pacific Crest and For Entrepreneurs on SaaS growth rates, CAC, churn rate, and other metrics revealed that fastest growing SaaS companies rely more on upsells and a major percentage of their revenue comes from existing customers who opt for upsells. The faster a customer moves from free trial to paid customer to repeat customer, the likelihood of that customer sticking with your app increases significantly.

Upsell

Fastest growing SaaS companies rely more on upsells and a major percentage of their revenue comes from existing customers who opt for upsells


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May 11, 2019

Send Educational Blog-Posts

3. Retention  >  Send Educational Blog-Posts

Send educational blog-posts to reduce SaaS churn

When customers are able to get value from your app, they're least likely to churn. Educational blog posts that show them how to get things done and achieve success with your app is a great technique for delivering value.

● PERSUASION

Dropbox

Dropbox sends a personalized email to inactive users and share a link to a tour of their product.

Groove

Groove creates a post on new features and intimates its users through a simple email.

Outbrain

Outbrain sends a great introductory email with links to tutorials where users can learn more.

How to use the technique

  • Use personas to craft relevant blog posts. What type of content your ideal customers prefer? Is it how-to articles, in-depth guides, case studies, or any other type of content? Create relevant blog posts targeting specific buyer personas. Not sure how to do it? Read our free churn optimization framework
  • Share new features. Create a blog post on the release of new features. Share its link with users so they can start using it immediately.
  • Share blog posts with customers via email. Don’t send all blog posts to all the customers. Focus on personalization. Only send blog posts to relevant customers who are most likely to read and engage.
  • Segment users and target appropriately with relevant content. Send how-to guides to active users and case studies to inactive users. Segmentation makes your emails personalized which boosts engagement and reduces churn.
  • Set goals for each blog post you publish. And ensure your email has the same goal. Use prominent CTAs to achieve the goal.
  • Educate and help instead of selling. Handpick educational and informative blog posts and include them in the email sequence.
  • Send one email a week. Don’t spam. Even if you’re sending educational blog posts, don’t overdo. Send a short email with summaries of blog posts published last week.
  • Track performance of individual blog posts. It will help you understand what type of content converts better. Use UTM codes and goal tracking. Refer to our free churn optimization framework for more details.

Mistakes to avoid

  • Sending one email to all the customers. Not personalizing emails and blog posts to the user’s current status is a big mistake. Link blog posts to customer preferences to reduce churn.
  • Sending too many emails. Even if you’re sending educational content with an intention to help, too much of it isn’t recommended. Stick with one email per week rule.

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Research evidence

HubSpot collected data from 13K+ businesses on how often they blog. The results revealed businesses that publish 16+ blog posts a month receive 3.5x more traffic than businesses that publish 4 or fewer posts a month. And businesses that blog 11+ times a month generate 4x more leads than businesses that blog 4-5 times a month. Blogging is a perfect way to educate and engage readers.

3.5x

Businesses that publish 16+ blog posts a month receive 3.5x more traffic than businesses that publish 4 or fewer posts a month.


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May 11, 2019

Free Upgrade To A Higher Tier

3. Retention  >  Free Upgrade To A Higher Tier

Provide a free upgrade to a higher tier to reduce SaaS churn

Upgrading customer’s plans and moving them to a better plan without increasing price is an awesome technique to reduce churn, increase engagement, and retain customers.

● PERSUASION

Drip

Drip has no free trial but it lets users get access to a premium plan for free. Users get to enjoy premium plan at no cost.

Buzzsumo

BuzzSumo has no free plan but users can enjoy any plan for a month before paying for it.

Canva

Canva allows its customers to use Canva for work free for 30 days.

How to use the technique

  • Develop a strategy with clear goals. Why exactly you need to offer free upgrades? Is it for engagement, brand awareness, loyalty, churn reduction, future cashflow, etc.? Better conduct a survey and ask existing customers as to what they expect. Read our free churn optimization framework on how to conduct research. 
  • Select customers for the free upgrade based on a set criterion. For example, engagement, in-app activity, usage level, volume, etc. Use health score and pick customers with the highest or lowest health score.
  • Share details via an email. Explain the free upgrade, the benefits it comes with, the duration of the upgrade, and what you expect them to do next (try certain features).
  • Help them get more value from the free upgrade. Share tutorials and help guides to help them get value from the upgrade quickly. Assign an account manager for assistance. This works best for retention.
  • Let customers use the upgraded plan for some time. The free upgrade should last for a few good months so that customers can get value from the upgrade. Three months is a good time for the free upgrade.
  • Track performance. Are customers using features of the upgrade? Are they enjoying it? Are customers getting used to free upgrade? Have you separated free-riders from real customers? Make them used to the upgrade. Read our free churn optimization framework to find out more on how to do it practically.

Mistakes to avoid

  • Not setting clear rules. Without rules, free upgrades can backfire. If there is a duration for the free upgrade, clearly communicate it. Don’t hide anything. Give customers a freehand.
  • Degradation without prior intimation. If the plan will be downgraded after a few months and you already communicated it, send multiple reminders prior to degradation. The idea is to let customers switch permanently to the new plan.

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Research evidence

Valarie Zeithaml published an article in the Journal of Marketing on consumer’s perceptions of price, quality, and value of a product. It was found that consumers consider price, quality, and value in the exact same order when making a purchase decision. Price is the first thing that a consumer will give importance to over quality and value. Even if a customer perceives a product to be of high quality and value, the high perceived price will prove to be a barrier.

$$$

Price is the first thing that a consumer will give importance to over quality and value. Even if a customer perceives a product to be of high quality and value, the high perceived price will prove to be a barrier.


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May 11, 2019

Re-engage Inactive Users

3. Retention  >  Re-engage Inactive Users

Re-engage inactive users to reduce SaaS churn

Re-engaging inactive users is the only technique that will reduce churn. Identifying inactive users and figuring out what made them inactive – and taking appropriate proactive measures to bring them back is the name of the game.

● PERSUASION

Animoto

Animoto sends a nice re-engagement email asking users to update their email preferences.

Grammarly

Grammarly sends re-engagement emails to inactive customers who haven’t used their app for a good number of days.

Groove

Groove sends an open-ended question via email to users who cancel their accounts.

How to use the technique

  • Define who is an inactive user. How does your SaaS define inactive users? Someone who hasn’t logged in for a week, someone who hasn’t used any app feature for 10 days, someone who doesn’t open emails, etc. It is best to segment inactive users based on different inactivity variables and treat each segment differently. Refer to our free churn optimization framework for more details.
  • Identify the reason for inactivity. Cure the cause, not the symptom. Use data and behavioral analysis to understand the reason. Get over the phone for an interview with the inactive customers to dig deep.
  • Manually onboard users again who have been inactive for a good number of days. It’s highly likely that they didn’t get value from your app. This will help reducing churn.
  • Send personalized emails. Send personalized emails for re-engagement to different inactive segments. Emails should be relevant to the reasons why a segment is inactive.
  • Help them get value from your app. Having paying inactive customers mean they haven’t got the value from your app (what they expected). Re-engage them by helping them get their problem solved.
  • Assign an account manager. Assign account managers to inactive users to reduce churn. These managers should help and guide users to get value from your app.
  • Get feedback and improve. Ask inactive users to share their feedback. Make appropriate changes on the basis of feedback. You can read more in our free churn optimization framework

Mistakes to avoid

  • Not taking timely action. Be proactive. Detect inactivity early and respond with an appropriate re-engagement strategy. Monitor customers constantly for inactivity.
  • Offering discount to inactive customers is a bad move. They're already paying you so it’s not about the money. They're unable to get value or make your app work for them. Help them.

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Research evidence

Rajkumar Venkatesan in his article, published in the Journal of the Academy of Marketing Science, discussed how to execute customer engagement strategy. Customer engagement requires a systematic collection of data and information during pre-purchase, purchase, and post-purchase phases. The more you know about your customers, the easier it gets to create an engagement strategy.

1-2-3

Customer engagement requires a systematic collection of data and information during pre-purchase, purchase, and post-purchase phases.


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May 11, 2019

Highlight Annual Subscription

3. Retention  >  Highlight Annual Subscription

Highlight annual subscription to reduce SaaS churn

Annual subscription reduces churn, improves cashflow, and makes revenue predictable. Encourage, motivate, and incentivize customers to opt for annual billing instead of monthly.

● PERSUASION

Buffer

Buffer offers both monthly and annual billing. Customers save 20% with annual billing.

Mailerlite

Mailerlite offers both annual and monthly billing and clearly displays the actual dollars a customer will save per year.

Segment

Segment also has an annual billing option. To show some contrast, these two are presented in details side-by-side in a dynamic calculator

How to use the technique

  • Add annual subscription option without removing the monthly subscription. It is best to offer monthly, quarterly, bi-annual, and annual plans. Give maximum discount on the annual plan. Refer to our free churn optimization framework to get more details.
  • Offer discount on annual plans. No incentive works better than immediate savings. Clearly show how much a customer will save with an annual plan. Mention amount as well as percentage. Highlight savings.
  • Offer other incentives to annual subscribers. For example, priority support, a dedicated account manager, free access to webinars for the whole year, etc. Convert annual billing into a complete package with savings and additional incentives.
  • Communicate the benefits of opting to an annual subscription. Highlight benefits and make them prominent on the pricing page.
  • Send emails to monthly subscribers and encourage them to switch to the annual plan. Before you charge a customer’s card for the next month, send an email and clearly tell the benefits of switching to annual.
  • Show customers how much they missed to save. Send a history of monthly payments a customer has made and show how much could have been saved if it was an annual plan in the first place. Highlight the savings they missed just because they weren’t on the annual plan.
  • Test multiple annual billing options. You can test different variations of annual billing: Annual only, optional annual billing, and annual default. Also test CTAs, benefits, and savings. Optimize for conversions. We have crafted a grea free churn optimization framework to help you with conversion optimization.

Mistakes to avoid

  • Removing monthly subscription. Removing monthly billing and switching to annual only is a big mistake that might turn-off people ready for only small & safe commitments. Don’t do it. Monthly payments are better than no payments at all.
  • Ignoring annual subscribers. Not engaging with them assuming they're sure to stick with your company. Ignore them and they won’t renew their plan. Give these customers special attention.

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Research evidence

David Skok argued that SaaS should focus on three things: Acquiring, retaining, and monetizing customers. He further explained how SaaS businesses can deal with negative cashflow is early years (which is a common SaaS challenge) by switching from monthly to an annual subscription. Annual subscription reduces months to recover CAC which converts negative cashflow into positive right from the first few months.

365

Annual subscription reduces months to recover CAC which converts negative cashflow into positive right from the first few months.


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May 11, 2019

Create A Loyalty Program

3. Retention  >  Create A Loyalty Program

Create a loyalty program to reduce SaaS churn

A loyalty program can benefit your SaaS in several ways: Increase in revenue, repeat customers, churn reduction, engagement, and customer satisfaction. It’s a great way to build a community of loyal and satisfied customers.

● PERSUASION

Zizzi

Swarm Perks [https://www.theverge.com/2016/6/7/11870810/swarm-perks-app-rewards-update] gives interesting and useful reward to customers based on their location.z

Dropbox

Dropbox grew 3900% in 15 months with its customer loyalty program.

Swarm_Perks

Swarm Perks gives interesting and useful reward to customers based on their location.

How to use the technique

  • Analyze and get feedback from current customers. Use data to figure out how your current customers use your app, what challenges they have, what’s your profit margin, etc. Get feedback from customers to understand what rewards they prefer, what features they like, how much they’d pay for an upgraded version, etc. Not sure how to collect data? Get this free guide. Refer to our free churn optimization framework to learn more. 
  • Devise a point and reward system. It has to be simple yet challenging. Link point system to usage or other crucial metrics. Rewards should be interesting and meaningful.
  • Create customer selection criterion. Is your loyalty program for all customers or do they have to qualify for it based on a criterion such as usage, volume, payment, engagement, etc.?
  • Integrate into CRM. It will make your loyalty program systematic and meaningful. You'll be in a better position to set realistic goals.
  • Communicate and promote your loyalty program. Share on social media, emails, and send notifications. Add a CTA within the software. Create a support document to explain the program.
  • Measure performance. Has it reduced churn? Are rewards motivating customers? What buyer persona participated actively? The loyalty program should achieve its goals. If it doesn’t, revise and improve it. Read this free guide for step-by-step instructions.

Mistakes to avoid

  • Making it complex. Do customers have to spend time to learn and understand your loyalty program? If so, it won’t work. Change it. Make it simple. Use terms, scoring system, and rewards your customers are aware of.
  • Poor rewards that don’t motivate customers. The rewards shouldn’t be meaningless. Nothing works better than monetary rewards (free subscription, free upgrade, gift cards, etc.).

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Research evidence

Frederick Reichheld conducted research on how loyal customers help businesses save cost. The findings revealed that increasing customer retention by 5% will increase profits by 25%-95%. The reason is simple: Return customers don’t cost a penny to your business. The customer acquisition cost has already been incurred and as they buy again, it reduces operating cost significantly.

95%

Increasing customer retention by 5% will increase profits by 25%-95%. The reason is simple: Return customers don’t cost a penny to your business.


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May 11, 2019

Release New Versions

3. Retention  >  Release New Versions

Release new versions to reduce SaaS churn

Customers are more likely to churn if they get bored with your app. Release new versions often, upgrade, and add new features to keep customers hooked. Share details of the new version and let customers know how it’s different (and better).

●● INTUITIVENESS

Trello

Trello uses its own software to share complete development roadmap with the users. It’s a perfect way to communicate updates and new versions.

Mind_The_Byte

Mind the Byte informs its customers of the new version by publishing a new blog post.

Medium

Medium has a dedicated product announcement page where it talks about new versions and releases.

How to use the technique

  • Plan new releases based on customer feedback and usage analysis. Prepare a development roadmap (schedule) for new versions so as to plan everything. Refer to our free churn optimization framework to learn more. 
  • Add new features to reduce churn. Simply updating features won’t work. Provide customers with something new and interesting with each new release.
  • Clear communication is essential. Use development roadmap to share details of the next release with customers well before time. This will keep them engaged and reduce churn. Tell them what they should expect with the new release.
  • Announce maintenance hours. Send multiple reminders via email and in-app notifications. Keep customers in the loop.
  • Share the benefits of the new version with your customers. They aren’t interested in version name and number rather they're interested in what’s in it for them. Share benefits through email, blog, and social networks.
  • Analyze performance. How new version influenced churn and customer engagement? Did it improve login activity? Not all new versions perform well, don’t forget to measure success. Here is a free guide for you to read more about analytics.

Mistakes to avoid

  • Unnecessary upgrades are useless. A new version for the sake of a new version or to reduce churn might backfire. Don’t release a new version if it doesn’t add any value.
  • Rolling out upgrade during peak hours will ruin customer engagement. Don’t hurt UX. Roll out upgrades after midnight when the majority of customers don’t use your app.

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We will reveal an EXACT framework we use to improve conversion & retention rates of our SaaS clients by at least 30%.

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Research evidence

According to Customer Service Barometer 2017, consumers appreciate it when brands meet or exceed their expectations and are clear in communication. Millennials are more likely to share their great customer experience with friends and family. When SaaS clearly communicates software upgrades, it is appreciated by customers and they tend to stick with the business.

v2.0

When SaaS clearly communicates software upgrades, it is appreciated by customers and they tend to stick with the business.


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May 11, 2019

Host Webinars

3. Retention  >  Host Webinars

Host webinars to reduce SaaS churn

Hosting webinars consistently will keep customers engaged and will reduce churn. Webinars provide you with an opportunity to interact with your customers, listen to them, guide them, and get feedback to improve your software.

●● INTUITIVENESS

Intercom

Intercom increased its activation rate 6x by hosting educational webinars.

Autopilot

Autopilot went from zero to 2000 customers in 1.5 years by hosting webinars regularly.

Adespresso

Adespresso conducts several webinars and it has created a dedicated page for webinars where you can find recordings of all the previous webinars.

How to use the technique

  • Create an editorial calendar for webinars. When you need to host a webinar and what it should be about are the two critical questions to answer. Host webinars for different buyer personas, customer types, and address all lifecycle stages. We have an awesome free churn optimization framework to guide you further.
  • Host no more than one webinar a week. Attendees don’t have the potential to attend more than a single webinar in a week.
  • Set clear objectives. Each webinar should have clear goals. Is it to reduce churn? Is it to boost engagement? Is it for inactive users? Is it to promote an upgrade? Craft webinar based on its objectives.
  • Send multiple registration reminders preferably via email. Tuesday is the best day for webinar registration.
  • Add a Q&A session. It lets you understand customers and get feedback. It boosts engagement. What’s better than solving a customer query in real-time?
  • Record webinars and share them with registrants who didn’t attend. Publish recording on your blog and YouTube channel. Don’t let it sit on your server.
  • Measure the success of each webinar in terms of conversions, engagement, retention, and reduction in churn. Track performance based on webinar time, day, duration, and other variables. Tweak to improve performance. Read this free guide to master testing and tweaking. 

Mistakes to avoid

  • Not addressing customer issues. While it’s essential to achieve webinar objectives but it’s equally important to address customer issues at the end of the session. Listen and respond to make them stick with your software.
  • Not sending reminders for webinar registration and for attendance. Remind attendees of the exact date and time and send them reminders on their email and phone on the webinar day.

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We will reveal an EXACT framework we use to improve conversion & retention rates of our SaaS clients by at least 30%.

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Research evidence

According to the Big Book of Webinar Stats 2017 73% of marketers said that a webinar is the best way to generate quality leads and 57% of marketers reported that they plan to host more webinars next year. Webinars are a powerful source of customer engagement and retention since you can move customers through the entire lifecycle with multiple webinars.

73%

73% of marketers said that a webinar is the best way to generate quality leads. 57% of marketers reported that they plan to host more webinars next year


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May 11, 2019

Early Warning System

3. Retention  >  Develop An Early Warning System

Develop an early warning system to reduce SaaS churn

Developing a warning system to predict churn is a decent approach to reducing churn proactively. Assign churn score to customers that will help your sales team to identify users who are about to churn. Take necessary action to retain them.

●● INTUITIVENESS

Asana

Asana has developed a metric that it calls Account Health Score to measure customer success.

Upscope

Upscope has a simple ranking system that ranks users on the basis of usage.

UserIQ

UserIQ measures five key metrics to that it calls churn indicators.

How to use the technique

  • Identify key metrics that predict churn and engagement. For instance, login sessions, usage details, account activity, email open rates, satisfaction score, etc. are some of the metrics that determine the engagement level of a customer. Identify ones that accurately predict churn. Use our free churn optimization framework for more details. 
  • Develop a system to evaluate and monitor these metrics. Create customer health score or churn score metric based on identified metrics. The customer health score is used to identify customers about to churn.
  • Develop a dashboard for your team where they can monitor customer health score, share details, and work on campaigns to retain customers. The warnings should be displayed in the dashboard so that your team knows everything about customer’s health. Such as dashboard will streamline the process.
  • Create an engagement plan. The purpose of early warning is to engage customers who have low health score and are likely to churn. Create an engagement plan such as email series, retention callback, promotions, discount offers, etc.
  • Assign users to sales reps for engagement. Don’t automate the retention process. Ensure customers are taken care of by your sales team. Assign a reasonable number of customers to a rep.
  • Track performance. Is your warning system working fine? Are you tracking the right metrics? Is engagement plan delivering? Amend the warning system if it isn’t working. Read this free guide for more details.

Mistakes to avoid

  • Not defining customer health or churn score. Doing it all manually won’t work. Create a robust warning system so that customers with low health score popup in the dashboard right away.
  • Not reacting on time. The whole point of developing an early warning system is to reduce churn by taking proactive precautionary measures. Take action on time.

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Research evidence

Khan, Manoj, Singh, and Blumenstock developed an analytic framework to detect signs of churn. This was achieved by assigning a churn score to customers. This approach to developing a rigorous system to create a warning system helps reduce churn.

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There is a lot of research going on to develop models for calculating customers churn probability. Use their findings for your SaaS!


Related techniques SEE ALL THE TECHNIQUES >

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