At present, SaaS customer churn is havoc for SaaS businesses in the market. No one wants to lose even a single customer because letting go of a customer is more like losing both customer and revenue. So, we have this piece of writing to help you reduce the churn rate to a minimum.
Know the Reason for the Churn
There can be varying reasons for customer churn depending on the business. However, you must know the reason for the churn in your SaaS business. Also, it is not compulsory that the customer churn is caused because the customers are leaving willingly. Sometimes, customers have no intention to leave but they get their subscriptions for the SaaS product cancelled. It happens because of payment failures or other technical reasons. Whatever the reason for the churn in your SaaS business, you need to know it first because only then you will be able to work and nip the evil in the bud.
Strategize for Churn Reduction for SaaS
Now that you know the reason for the churn rate for your SaaS business, you need to make a strategy to curb the issue. For instance, if you find out that the reason for the churn rate in your SaaS business is because of payment failures, you will have to integrate multiple payment gateways with your SaaS subscription management system. Integration with gateways will offer you a secure way to process online payments. So, always make a strategy for your SaaS business once you know the reason for the churn rate in your business.
Monitor Certain Specific KPIs
When you are working in the SaaS business industry, it is important to keep an eye on the performance of certain KPIs. The important KPIs regarding customer churn include Monthly Recurring Revenue (MRR), Annual Recurring Revenue (ARR), and Customer Lifetime Value (CLV). The monitoring of these KPIs will show you the performance of your business in the SaaS business market. If ARR, MRR or CLV show a fall, then it is evident that your customers are churning. So, monitoring KPIs will also be helpful in identifying customer churn and its reasons.
When you are working on a strategy to deal with the customer churn rate, never forget about the involuntary customer churn rate. The involuntary churn rate is not because of the intention of the customer to leave rather it is because of technical reasons. For instance, sometimes, the customer tries to pay through a certain specific payment gateway, but the gateway is down. So, the payment does not get processed. When customers fail to pay, the system automatically cancels their subscriptions rather than giving them another chance to try to pay through some other payment method or the gateway. When other payment gateways are integrated, the system automatically processes the online payments through the other payment gateway when one is down. So, to deal with churn, integrate your subscription management system with other payment gateways.
As a SaaS business, you also need to conduct a churn analysis. For analysis of customer churn, you can use business analytics. Churn reduction for SaaS startups and established enterprises is important. And to do that analysis and audit of the churn are important. Customer data will tell you the pattern of the customer behaviour from which you can identify the reasons for the churn and even the solution to curb the increasing customer churn rate. Use your subscription management system that can offer business analytics to deal with the customer churn rate.
Engage Your Customers Once Again
The best and foremost solution to treat the customer churn rate is to communicate with your customers. Communication is also a way to find the reason for the churn and to find the solution to treat the churn rate. You can communicate through emails and messages. Ask your churning customers to at least leave feedback so that you can retain the remaining customers and onboard the loyal ones. also, you can communicate and offer your customers some lucrative discounts and offers to make them stop the cancellation of their subscriptions. Also, onboard a competent team of marketing and sales to get loyal customers and make them stay with you longer. By now, it is clear that customer retention is lined with customer satisfaction. The more you keep your customers satisfied, the more they will be their CLV for your SaaS business. Also, for SaaS customer churn reduction, communicate with your customers effectively. You can even automate the process of communication with the customers. You can use chatbots to at least reply to your customers timely and appropriately.