In cloud computing, software as a service (SaaS) is probably the most famous category for a good reason. Virtually, it has eliminated the need for businesses to run programs locally or get custom-built programs, which tend to be cost-extensive. Most importantly, SaaS has enabled both small and large companies to compete on the same lane to scale their growth thanks to equal access to essential services.
But, according to Totango, the SaaS industry experiences a churn rate of about 5 percent or higher every year. If you’re in this business, there’s every reason to be alarmed by such figures. Marketing your SaaS business and improving your retention rates is the key to staying afloat if you want to grow your business.
The question is, how exactly can you improve your SaaS service? In this post, we’re going to share some actionable and growth-hacking tips that you can leverage to ensure quality services to your customers.
1. Start with Customer Service
For software vendors, it helps to understand that there’s a proliferation of software and apps on the market. Most of them offer a free trial or money-back guarantee programs. In this case, customers are given the opportunity to review your software and try some of the available features to determine if they’re user-friendly and objective.
The first thing you want to look at is the quality of your customer service. Are you reachable via different channels and platforms? Do you have a knowledge base that provides answers, guides, and solutions to some of the common questions? How well are your support agents upskilled on your systems? As Forbes notes, there is nothing as important as quality customer service in a SaaS environment.
Ensure Prompt Response
Noways, companies are using self-service and inline support to offer immediate assistance to their customers. This is something you should do to, and you can use tools, such as Samanage and Toonimo, to streamline your support and packages like Clockspot to track time of your employees. Staying on top of all support requisitions is the key to keeping your retention rate high.
Keep in mind that a support request that goes for days or weeks unattended could be the reason for a lost subscription. Try to patch such loopholes by offering 24/7 support or other self-service tools that can help fix issues in a timely matter.
Leverage Omnichannel Support
Gone are the days when companies provide support via call and email only. Today, your support should be all-round. Typically, this doesn’t mean that you should adopt all the communication tools and services out there. Only use options that your clients love or are already using. A great support channel mix should include call, email, live chat, and social media.
When it comes to omnichannel support, one mistake that companies make is running all the channels they offer separately. This will to delays and poor support, particularly when a customer uses two or more channels to contact you. Instead, you need to have a backend support system that tracks and organizes all the support requests to allow your agents to offer quality customer service.
In this case, customers who sought help via email need not re-explain the issue when they follow-up through a call.
Involve All Your Team Members
One way to deliver quality support services is to involve all the departments. For example, if there is an IT issue that affected the billing cycles of several customers, both your billing department and IT department should stay up to date on the issue. Support tools, such as Brand Embassy and Teamsupport, are great for allowing feedback and input from different departments.
As a SaaS company, it necessary to find ways that encourage and facilitate a cross-departmental exchange of information to improve your customer service. For example, if your product department fails to liaise fully with your sales department, it becomes hectic for your salespeople to provide walkthroughs or onboarding help.
Instead of focusing on driving massive saves, pay attention to improving service for your existing customers. You can do this by offering reports that are customized with pad printing, 24/7 support, free upgrades, onsite training, and prompt response to requests and calls.
Set Up a Customer Success Department
For large companies, this department can be independent. However, for small to medium size SaaS companies, you can set up a few of your salespeople to manage the overall experience of your customers. The role of the department is to analyze the journey performance of clients.
They monitor the whole journey and implement continuous improvements to the processes. The team also create methods that help to identify customers that are at-risk to prevent churn. One thing to note is that customer success is unique to customers.
2. Proper Training and Onboarding
It’s easy to get consumed with improving your conversion rates and forget catering to your existing conversions. When marketing a software program, a significant stage of the sales funnel is training and onboarding. You customers must understand the use and features of your software correctly. This is why offer free trials make a lot of sense.
Educate them On the Features
The first step is usually to explain your features. You can use a short video to show all the ins and outs of the app or software. Let them know the cool features that can actually benefit them and how they can use them to improve their workflows and processes. If you offer APIs, it helps to show them how they can seamlessly integrate their systems with your app for enhanced performance.
For example, if you offer a CRM software, you can educate the different members of your client’s team on how to use it. Let social media marketers know and understand the crucial features of social engagement and management. The salespeople should know how to use the contact and lead management tools.
The marketing team should also understand the use of campaign management feature and, reporting, and dashboards. This way, every member will be familiar with all the features of your software. The result is a better collaborative environment for the sales, marketing, and support teams that improve communication, discussions, and information exchange.
As part of the training and onboarding process, it helps to share your success stories and experiences. Provide proof of some of the successes your past and existing clients have achieved through the use of your service. This helps to show your prospective customers that you know what you’re doing, and it helps to build trust from the start.
Share with them case studies regarding past projects to show the problems you tackled and how you reached the solutions. You also need to keep abreast of the latest news, trends, and developments in your industries. With this information, you can educate your customers on about the tricks and tips that they can leverage to improve their experience.
Training should not stop with a subscription, and this is a key takeaway for maintaining significant retentions. Your customers are bound to experience problems along the way. So, you need to follow up with them to ensure everything is going smoothly and help them where necessary.
Try to reach out to those protective customers that bounced. They came and used up their free trials, but they chose not to proceed with a subscription. You need to know why. This can be a short survey or text email, which they can respond to leave feedback and share their thoughts. You’ll be surprised when some of them share things that you overlooked or haven’t thought of before.
3. Leverage Your Existing Customers
As noted earlier, many businesses in the SaaS market tend to channel most of their efforts and resources into lead generation and conversions. They tend to forget that they actually have a gold mine that they can leverage to improve their overall service. As such, it’s your responsibility to ensure that every customer you have is contented with your product.
Depending on your subscription type, you need to make sure that your clients are making the most of their plans. The more your customer benefits, the easier it will be for you to increase your Average Revenue per User (ARPU). Growing your ARPU can have a significant impact than striving to lower your churn.
Use Customer Journey Maps
The first thing you want to do is to have a customer persona. This is typically an improvised profile or avatar of the kind of person or business you expect to benefit from your software. The persona should help you understand the whole customer journey in your sales funnel. It’s always a good idea though that the journey shouldn’t end at the “become a customer” stage.
Instead, the journey map should cover all the essential stages, including onboarding, training, post-sales, renewal, and upsell stages. This will help you to refine the whole customer experience and identify all the possible pain points, which you can eliminate early enough before they pose significant issues in the future. Don’t forget to include any internal processes that affect your customer’s’ journey on the map.
Analyze Your Existing Data
With your persona journey map, you can review your existing customer data and experiences to get clues into problematic areas. For example, you can look at the customer volume at each stage to determine where the highest drop occurs. You also want to look at your customer engagement with your product. Are they underusing their plans? Do their usage signifies that they need further training?
Another critical consideration is identifying the most common reason for support requests and the possible causes. This will help you improve your customer support and fix areas that are consistently causing problems. It also helps to identify and list the reasons for churn and try to address them one at a time.
There are also specific metrics for growth and acquisition that you need to track and use to gauge your overall performance. This includes annual contract value (ACV), active users (AU), month on month growth, traffic courses, new trial signups, and burn rate.
Especially if you are in the techy business, you should always keep your data clean and continuously work on its improvement. Learn more here.
4. Use a Systematic Approach to Growth
As a general rule in the SaaS world, your software is bound for growth if it provides solutions to problems experienced by a significant number of businesses in your target industry. But you just can’t move forward with that conviction. You need a systematic approach that’s going to scale your growth from the onset.
The problem with many SaaS companies is that they hit the point where they have “some customers” and stuck there. In this state, they tend to be pushed into the corner when new products storm the market. Keep in mind that there’s always a churn, and this means that they start moving backward. All these occur due to the lack of a solid plan.
For a systematic approach, you need to focus on an essential metrics for tracking growth. These include:
- Number of active leads in your pipeline
- Deal velocity
- Conversion rates
- Average contract value
When you look at these metrics, they’re all inter-dependable. The number of active leads simply show the number of opportunities you have. So, depending on the plan you have in place, you can actually turn the leads into actual customers. But wait. This isn’t something that just happens overnight.
Keep in mind that there are various people within a company that are involved in deciding to adopt a new software. This is where the idea of deal velocity comes to mind. Basically, deal velocity is the time it takes to get a lead from the customer. Your sales team is tasked to keep this time as minimal as possible.
From there, you have the conversion rate, which is the percentage of leads that actually convert into paying customers. The rate can be high or low depending on how useful your product is to your target customers. Of course, other factors come into play, such as pricing, features, and ease of use.
Your average contract value (ACV) depends on different scenarios. Typically, your service can charge clients per usage or user. For example, some services cost over $10,000 per year for unlimited users. In this case, you don’t to have a million subscriptions to keep your ACV high.
Whatever the case, your approach should factor in every possible opportunity for growth. Whether you need a million subscriptions or just a few thousands, it all depends on how you’re going to play everything out.
The Bottom Line
Improving your SaaS service is the ideal way to reduce churn, boost revenues, and increase your signup rates. Bust like any other business, getting there isn’t going to be a magic leap. It will take time, resources, and commitment. Remember to offer different packages, which are usually three in most cases. Giving customers different options is an ideal way to ensure consistent revenue.
As you grow, continue monitoring the activities and usage of your clients while making buy-in changes where necessary. Giving them better experience and flexibility will certainly kick up your leads and conversion rates.