For a SaaS company, customer retention is everything. Externally, the entire market value of your company rests on your ability to retain your customers. And internally, churning through customers is a slow downward spiral of exhaustion, which indicates something is wrong with your product, onboarding/support resources or market fit.
Transcript: Customer churn sucks but doesn’t have to suck the life out of your SaaS business. Hi, I’m Justin Talerico with Married2Growth and this is my perspective on my number one indicator of SaaS capital efficiency—customer churn. Unlike revenue churn, customer churn is binary. They’re either a customer or they’re not. And when they’re not, […]
Revenue churn is a huge indicator of growth potential. That’s because, even when companies have significant customer churn, they can overcome it with expansion revenue. When you have that, combined with success in new customer acquisition, you have a growth machine that will be hard to slow down. It’s a recipe for success.
SaaS businesses grow at the intersection of customer acquisition and lifetime value. When customers churn they cut short lifetime value and upend the fundamental driver of healthy growth
While you may not be able overcome fundamental problems with your product or your go-to-market, the good news is there are actually really effective things you can do to help increase customer retention that aren’t going to come at a high cost.
While you may not be able overcome fundamental problems with your product or your go-to-market, the good news is there are actually really effective things you can do to help increase customer retention.
Why is setting the right buyer expectations so important? Because this is what leads to customers who accelerate themselves through onboarding, adopt your product and renew when it comes time. Buyers who know what to expect are far more likely to be retained than those who don’t. Prepared customers are the best customers.
SaaS customer retention is everything. Everything. If you are bootstrapping or running lean, it’s the only way to have a healthy, profitable company. And if you are raising money or want to be acquired, it’s the basis for the entire valuation of your company. While customer retention takes a village, sales is the most on the front line of selling to the right customers and side stepping the wrong ones.
Without a clear definition of what types of customers and contracts are most likely to be retained, it’s hard to avoid the wrong ones. Sales leadership needs to document, and educate the sales team constantly on these four things.