There’s one topic you’ll find on every list of metrics a SaaS should care about and that’s customer churn. Reducing customer churn is critical to achieving long-term growth and profitability because research shows:
It costs up to 7x more to acquire a new customer than to retain an old one
Increasing customer retention by only 5% can increase profits anywhere from 25-95%
The latest SaaS customer retention tools are reducing churn by 10 - 30% by addressing churn within the customer cancellation flow. Once overlooked, this critical moment in the customer journey has enormous potential.
If you’re interested in decreasing churn and keeping customers renewing again and again, this post is for you. Read on to discover the 7 customer retention software must-haves in 2022.
You’ve worked hard to acquire every single one of your customers. So, the last thing you want to do is let them slip away because you’re not using effective customer retention programs. And in 2022, effective means automated.
When you use an automated customer retention software, you can easily save customers at the last second with effective persuasion techniques – like discounts, special offers, or coupons. This approach helps you increase customer lifetime value while also providing robust business and product insights.
But not every automated customer retention program is the same. For example, some tools:
Manage just voluntary churn (e.g., when a customer cancels at the end of a trial period or decides not to renew)
Focus just on involuntary churn (also known as dunning – or when a customer’s card is expired or payment doesn’t go through)
Include both voluntary and involuntary churn as well as a combination of churn-related solutions like adoption, renewal, and expansion
Because there are many options, it can be challenging to choose the right automated customer retention software for your business. To make sure you’re building a program you can quickly stand up and benefit from, we recommend you assess softwares based on the following criteria.
To create a powerful retention engine, you want to integrate your automated customer retention software with the customer data you already have. And it should be easy to do.
ProsperStack integrates with the most popular billing platforms and CRMs to automate the entire cancellation experience. A few lines of code, and you're up and running.
Once your solution is up and running, can you adjust and customize it on the fly? Or does it require development?
When you see how you can save customers, you’ll want to make some changes. That’s why you want a tool that lets you make changes at any time to respond to the unexpected – without developers. Ideally, it should be highly visual, with just a few clicks required.
Can you test different customer retention strategies head-to-head to see which one works best? Is this feature automated?
It’s tough to conduct A/B testing and determine the most effective offers by hand. An automated option here can be game-changing because even a few percentage points add up quickly when it comes to holding onto customers.
Are you able to easily measure the effectiveness of your churn program to understand its actual impact on your bottom line?
Understanding what incentives work best for each customer segment gives you the intel needed to win back more customers quicker, leading to more revenue saved.
Does the automated customer retention tool offer a dashboard or similar reporting function that helps you translate data into insights? Does it include both quantitative and qualitative features? Can you customize the data for your business?
This topic is more important than it seems because you’ll have access to data you’ve likely never had before. For example, customer product feedback may help you prioritize your product roadmap to correlate product features to lost monthly recurring revenue.
Is the vendor continually adding new features and functionality to keep up with the nature of a subscription business? Can you easily access details about product changes?
If the tool you’re assessing hasn’t delivered a significant new feature in the last few months, that’s a red flag. The subscription market is growing fast, and you don’t want to miss out on opportunities.
How will your vendor keep you up to date on industry best practices? Do they know what customer retention strategies are working well for similar companies?
We’re SaaS industry veterans and a SaaS ourselves. That means we understand the unique pain points you’re facing. We have case studies from brands just like yours and we understand exactly what improved their ROI.
If you’d rather spend your days doing what you’re best at instead of worrying about churn, we’d love to talk and discuss our automated customer retention tool. Every day, we help subscription-based businesses flip the growth switch through automated customer retention.
With our hosted cancellation flow, you can see results quickly – and we’re talking a matter of hours. Let’s start retaining your customers, driving down your churn rate, and growing your revenue. Learn more and see a demo today.