If Your Retention Is Poor, Nothing Else Matters
Brian Balfour (former VP Growth at HubSpot) said it right that if you have failed to retain customers, then anything else does not matter at all. To understand it, consider the SaaS business various factors that are linked with customer retention:
- Customer satisfaction
- Monthly recurring revenue
- Annual recurring revenue
- Revenue retention
- Business Analytics
You see, customer retention for small businesses or the large enterprise is linked to several other very important factors of a subscription business. If retention is poor, then customer satisfaction, revenue, and predictive analysis also suffer. In other other words: The Business Collapse!
Also Read: Lessons to Learn from Churned Customers for Improved Customer Retention
Customer Segmentation
First things first, you need to segregate customers. First, segregate those who are on the verge of leaving your product or services. Then you need to make the strategy to make these customers stay. Now, even if you succeed in retaining the customers, you cannot be at ease. Find out the type of customers whom you have retained.
For instance, if you have retained customers whose activity is not 100%, then it is for sure that they are not going to help you achieve the revenue targets. So, to achieve revenue targets in that case, you will either need to acquire more potential customers or try to retain customers who are completely active when it comes to using your software so that you can meet and exceed the revenue targets.
The point that needs to be part of the customer retention strategies for small businesses and large enterprises is that the segregation of customers is a continuous process. Also, no matter how efficient and robust the tech stack you use, the thing that empowers this engine is your acquisition and retention strategy.
Cost vs Return for Your Retention Strategy
Experts always say that customer acquisition is costlier than customer retention. That is the reason all businesses in the market are working on customer retention for SMBs. However, even if you have an expert team working on customer retention, you need to do a cost-benefit analysis of the strategy that you have designed. Just see the benefit that your retention strategy is offering in comparison to the cost that you are spending on retaining the customers. One of the best ways to retain recurring customers is to communicate with them. Communication with the customer needs the least resources to invest. So, pay attention to inbound marketing to have a loyal customer base.
Also Read: Combating Churn for a SaaS—Use Content to Attract, Educate, Convert and Retain Customer
Customer Loyalty Programs
When it comes to the retention of customers, SaaS SMBs opt for various customer loyalty programs. And these loyalty programs play a significant role in retaining recurring customers. For instance, Pizza Hut offered its customers a loyalty program under which it gave two points for every purchase of one dollar. And when a customer collects up to 200 points, he can purchase a medium-sized pizza for free. Likewise, Lenovo offers MyLenovo Rewards where a customer can earn reward points.
So, you can also plan and curate a customer loyalty program for your SaaS business in order to not only retain customers but to keep the entire customer base loyal.
You have done your part.
Let SubscriptionFlow take it from here!
subscription management software.
The Best Subscription Cancellation Experience
To this point, we have talked quite optimistically. Now, we will tell you how to prepare for the worst-case scenario. What to do if your strategy for customer retention for small businesses or a huge enterprise fails?
Start working on your subscription cancellation experience!
Yes, that’s what you need to do now to deal with the worst situations—subscription cancellation—customer churn. The customers who have decided to cancel the subscriptions and your retention strategies and customer loyalty programs have failed to stop them, then the only thing that can be done is to let them exit gracefully.
- Do not make them fill out lengthy feedback forms
- Do not prolong the process of a subscription cancellation
- Do not put any conditions on them
- Do not make your cancellation policies horrible
- Do not make them stay for any notice period etc.
- Do not restrict the access to your SaaS platform for the user abruptly
- Make your cancellation policies very clear from the beginning
- Offer your customers the option to rejoin
That’s how you can offer the best cancellation experience to your B2B SaaS businesses. Coming towards why do you need to bother about so much about the cancellation, because it is a complete experience for the customer. When the customer sees that you are so caring and gentle with your leaving customers, then it will boost your branding. The customer will quote and refer to your product or services in good words.
Also Read: How to Control High Customer Churn with SaaS Customer Retention Management – RetentionFlow App
Conclusion
When too many customers leave, it is the point of concern that you should make it the centre of attention for the time being. Why? Because you cannot think of meeting revenue targets without customer retention. You cannot get investors when your customers are leaking. So, the issue of customer churn has a domino effect that can shatter the foundation of your SaaS subscription business. However, SubscriptionFlow offers you the best subscription management and payment processing platform to manage your business so that you may not need to worry about several other issues that are associated with the churning of customers.
