Jeremy Davis on how stellar customer experience can boost retention, drive engagement, and reduce churn for businesses
Life is unpredictable for SaaS companies. Tech start-ups and their software projects are in abundance but whether upstart or incumbent, the age of the subscription economy demands a lot from organisations trying to make software stick. Not only is competition fierce, but customers are increasingly fickle and ready to switch loyalties between rivals.
This is where customer experience can be a business differentiator. From pre-sales and purchase to onboarding and ongoing customer education, experiences play a crucial role across the entire customer journey.
Here are five ways that SaaS companies can boost customer retention, drive engagement, and reduce churn by delivering exceptional customer experiences.
Step 1: Prioritise customer experience in your business
Customer expectations have changed, thanks to innovative technology giants like Amazon and Spotify. A Salesforce survey found that 67% of people reported that their standard for “good experiences” is now greater than ever before. The key to building retention for SaaS companies is to deliver exceptional software experiences that add value to your customers at every opportunity. Customers expect to be able to carry out complex transactions, activities, and tasks anywhere, anytime, and on any device. But the demand for great experiences goes beyond that. For example, in sales, training and customer service, every interaction with a customer must be as effort-free and value-adding as possible. Gartner research found that there are two main ways to maintain customer loyalty: resolving customer issues efficiently with minimal effort on their part and helping customers gain more value from your software. Make delivering exceptional customer experiences your number one priority.
When customer education goes well, customers learn how to get more from your product, increasing retention and encouraging greater loyalty and advocacy
Step 2: Showcase long-term value during pre-sales and purchase
Customers can get more value from your product if they know how to use it to achieve their goals, if they know tips and tricks to be more efficient, or if they receive ongoing education on how to keep improving outcomes. The goal, therefore, is to identify opportunities and then actively deliver experiences that enhance the value of your product in your customer’s eyes. It might seem unintuitive to focus on retention before a prospect has become a customer, but this couldn’t be further from the truth. From the first contact with the prospect, the ball is in play. Without the right approach, customers could drop off and turn to a competitor at any point. Be sure to understand prospect pain points, align to their unique requirement and show not tell – they need to see real life examples.
Step 3: Get onboarding right, and the rest will follow
Onboarding is where the buyer’s journey and the customer’s journey meet. There is a multitude of opportunities to offer value enhancement here, but there are also many pitfalls to be aware of. Some of the mistakes to avoid include providing slow, complex, overly technical onboarding processes and not aligning onboarding experiences with the customer’s unique requirements. A smooth transition between the buyer’s journey and customer journey is crucial so make onboarding seamless and ideally use one platform for all engagement. Ensure its hyper personalised – aligning the onboarding processes with customer goals and expectations, so that you are always showing the customer what is valuable to them. Keep an eye on customer progress and monitor customer behaviour by identifying exactly how users interact with your product which will help you in the all-important follow up.
Step 4: Create a hyper-engaging customer education experience
It’s no secret that investing in customer education produces fantastic ROI. In a 2019 Forrester report, 90% of respondents said they had seen positive returns on their investment in customer education. Due to this success, spending on customer education increased by 80% in the preceding two years. This is because good training provides value enhancement. When customer education goes well, customers learn how to get more from your product, increasing retention and encouraging greater loyalty and advocacy. Here are some ways to ensure you are doing that:
• Offer multiple learning methods: Personalisation is key and people learn in different ways, whether that’s self-led or instructor led, virtual or in person, passive or active – tailoring the experience can boost engagement, satisfaction and knowledge retention.
• Offer ongoing opportunities for learning: Ultimately, you want to create super users: people who understand and love your product. As new features are introduced, ensure that they understand how they add value to them personally
• Create engaging training experiences: Quite simply, make them immersive, valuable and if possible, fun!
Step 5: Don’t lose sight of customer retention
Customer retention has never been more profitable for software companies. Leading organisations in every industry are already moving away from a mindset focused on customer acquisition alone to a retention-focused one. Of course, attracting new customers is still essential. Every customer retention strategy will fail miserably without a healthy, growing customer base to retain. But by switching the priority of focus in key areas, you can reap rewards. Not convinced?
• Acquiring a new customer cost five times more than retaining an existing customer.
• 80% of your future profits will come from just 30% of your existing customers.
• Loyal clients spend 33% more than new clients.
• Increasing customer retention by 5% can increase profits by up to 25% to 95%.
Excellent customer experience should start from the first moment you are engaging a prospect and should never stop. Get ahead of the competition and make sure your customers not only stay loyal and shun rival solutions, but also advocate for your brand by delivering stand out customer experiences across all parts of their journey with you.
Jeremy Davis, head of product marketing, CloudShare