If you’ve been working under a hypergrowth environment for the past 18 months, it should be clear by now that the last three have changed everything. To succeed in this new landscape, SaaS companies will need to pivot or re-prioritize, re-focusing on retention, expansion, and keeping their customers happy.
That means some of the past strategies you used to engage with customers might not work as well today. Pendo’s senior director of platform Chad Burnette and automation platform Tray.io’s head of product, Bella Renney, recently shared their advice on what you can do, right now, to make retention your new growth during a recent webinar.
It’s a lot more cost-effective to retain and grow your current customers than it is to obtain new ones, Renney said. Specifically, it’s seven times more efficient. “Doing more with less naturally leads to this focus on trying to retain and expand,” she said.
It’s also a lot easier: You’ve already got loads of data and feedback from the people who have been using your app. That allows you to be strategic about where you invest resources to be sure each decision is aimed at retaining those customers.
“With new customers, you don’t know anything about them yet, because they haven’t been in your tool,” Renney said.
And, Burnette noted, the top 30 percent of SaaS companies derive one-fifth to nearly one-third of their revenue from expansion. Investing long-term relationships with existing customers, with renewal and expansion of those accounts, clearly lead to success.
So what can you do right now to drive renewal and expansion?
Burnette said now is a time to step up your outreach to your customers, engaging them more proactively than in the past to aggressively obtain more qualitative feedback. That, combined with insight gleaned from product usage data, can help you identify the highest value projects to pursue in the near term. Look for the most requested functionality, and then evaluate each for whether it’s something you could bake into an existing subscription, or if it’s a substantial enough feature to be upsold. Pendo, with its in-app messaging capabilities, comes in handy here, he said.
View trial users through a retention lens, Burnette recommended. “If you really think about it, if you get someone to sign up for a trial, you are retaining them. You’re retaining them into a mode where they’re actually paying. You’ve got the fish on the hook,” he said.
You should also be looking to reduce as much friction in your product between a user experiencing the app and their ability to self-serve support and clear hurdles to success. And, make sure your resources are allocated in the most effective way. Think about integrations that you could leverage to put some of the burden on companies who do certain things better than you, so your engineers can focus on your own wheelhouse and delivering the most value to your customers.
“Find experts in the field so you can dedicate your resources to your expertise, your product, and your area of the market you solve problems for, and lean on other companies and their expertise in their area of the market, and not have to do it all in-house,” Renney said.
Since we’re all operating with fewer resources these days, think about ways to use automation to increase engagement and retention with your customers. If a user in a trial is idling and not accomplishing anything useful, you can nudge them with an automated email triggered based on certain usage metrics, Burnette says.
Setting up automation in Tray to feed NPS responses into Microsoft Teams or Slack can make it easier for everyone in your organization to catch bad scores and proactively reach out to those users to see what can be fixed. “You can immediately reach out and have a much better shot at retaining them,” he says.
Figure out which “north star” metrics are most important for your product, then collect that data from multiple tools and systems and compile them into a customer health score, Renney says. That’s data you’ll want to be staying on top of, now more than ever
When building your tech stack, make sure you’re selecting tools that offer low friction methods for unlocking their full functionality, so you can move fast when necessary, Renney said. “At this time in the game, I don’t want to have to talk to someone to unlock some feature that in the moment I really need,” she said. Make sure you can easily share insights from those tools with the wider organization for smooth collaboration.
You should also start viewing your tech stack as more of a “tech network,” or ecosystem, Burnette said. Make sure data can flow freely and automatically between your tools.