6 SaaS Customer Retention Best Practices
In customer retention, every engagement counts. There is no final effort in the days and weeks leading up to an anniversary that can overcome a poor relationship in the months prior. Rather, customer retention for SaaS enterprises is a result of the customer experience. It is an outcome based on an emotional reaction and connection to the performance of a supplier and the value a customer experiences through using that enterprise’s product.
Why Customer Retention Matters
The digitization of business has made customer retention the lifeblood of the Software-as-a-Service industry. The continued growth of the SaaS model, led by the multi-billion-dollar successes of B2B giants Microsoft and Salesforce, reflects a more responsive relationship between customer investment and ROI. With the majority of revenue spread out across repeated cycles of renewal rather than being captured in a single sales event, enterprises must continually deliver value, or risk their customers seeking more profitable relationships elsewhere.
SaaS customer retention best practices are therefore year-round and ever-evolving in an effort to maintain relevance and deliver value. When renewal time arrives, committing to another year should be just a logical extension of a successful partnership.
6 SaaS Customer Retention Best Practices
Retaining your customer’s interest, and therefore their business, depends on their ability to achieve their goals using your product. To increase the likelihood of renewal you schould focus your efforts on product understanding, effective usage, and customer knowledge.
The following SaaS customer retention best practices help promote those outcomes:
- Know Your Customer
- Deliver Value at Every Stage
- Personalize Your Voice
- Create and Celebrate Milestones
- Focus on the Future
- Adjust to Customer Business Needs
The process begins with a comprehensive understanding of your customer and their business goals.
1. Know Your Customer
Every time anyone in your enterprise connects with your customer they gain a little knowledge about them. Beginning with the initial sales effort and extending through every facet of the customer journey, this information needs to be collected and stored within a common reserve that is accessible to every member of your team.
2. Deliver Value at Every Stage
Customer expectations change over time. What begins as a need to learn how to incorporate your product into their workflows eventually becomes a desire to implement advanced features that deliver specific results. That’s why it is important to stay closely attached to your customer throughout their journey. By constantly checking their product usage, feature usage, and rollout though their business you can make personalised and proactive customer engagements.
3. Personalize Your Voice
As we mentioned earlier, the on-demand nature of the SaaS industry means customers expect their partners to deliver a personalized service dedicated to achieving their unique goals. The best way to create that environment is to fill your communications with facts drawn from the current customer experience. Personalizing your messaging with up-to-the-hour statements about customer progress, usage patterns, and industry-specific information tells your customer you are listen to them and are committed to their growth.
4. Create and Celebrate Mutual Success Plans
Milestones present a two-way benefit to SaaS enterprises. Firstly, they create a sense of momentum and achievement in the customer. Secondly, they give the enterprise a metric by which they can measure and monitor customer progress.
5. Focus on the Future
Customer retention is a promise of future growth. Your messaging should always reinforce the additional value that comes with greater mastery and implementation of your product. As the thrill of the initial sales and onboarding phases passes you should continue to deliver communications espousing future lessons, skills, and advantages.
6. Adjust to Customer Business Needs
Customer goals can change based on the needs of the business. In some cases, these goals may change rather quickly due to unforeseen circumstances like an economic downturn, industry changes like mandates or legal requirements, and much more. It’s imperative that your company, product, and customer success teams can both carefully and quickly adjust to any changes. Evaluating the impact of changes on customer business needs and adjusting your strategy to meet them is both critical and time-sensitive. Full strategy shifts may have to adjust in days, as opposed to weeks or months. Teams may not have all the answers upfront, but being as flexible, agile, and responsive as possible is important to retain customers through changes in their business needs and goals.
Success Through Customer Retention Software
Delivering a personalized, proactive customer experience depends on understanding how your product is being used. The digital delivery of SaaS products means you can accurately follow customer product usage through customer success software. Such solutions allow you to effectively measure customer engagement, feature use, and license utilization to accurately follow the health of all customer accounts within your portfolio. You can also use the software as a form of early warning system to automatically notify your customer success team of any changes in the customer experience in time to ward off churn or capitalize on renewal and upsell opportunities.
For the full article click here.
Source – Mia Jacobs