We all know customer churn is a big deal.
But the stakes are especially high for SaaS companies with subscription-based revenue models—like say, Copper.
As Copper’s Product Marketing Director, this means my role here has expanded past the traditional scope of Product Marketing, which has always mainly focused on customer acquisition. Our revenue is based on subscriptions, so customer retention is just as—if not even more—important.
In fact, it takes the median SaaS startup 11 months to earn back what they spend on customer acquisition within their first year in business alone.
So yeah, retention is important.
Product Marketers working in SaaS need to take care of customers throughout their entire buyer journey—and then the rest of their customer life cycle as well.
For those of you who don’t know, let’s just define what Product Marketing is real quick.
Product Marketers focus on the “Action” stage of the sales funnel. This means our main goals are educating prospects, helping to close deals, growing our customer base, and making sure these customers stay loyal—or in other words, making sure they don’t churn.
I myself am constantly working on ways in which I can contribute to reducing churn rates by conducting customer research and building on our Product Marketing strategy and positioning. I work across all team including Content Marketing, Product, and Customer Success and Sales to collaboratively approach the problem of churn and help execute new “smarketing” (sales x marketing) campaigns that align with our company’s goals.
And honestly, as far as churn goes, we’re doing a pretty good job at it (it helps that our product is awesome—no bias or anything).
Marketing a CRM can be a SaaS(y) challenge.
In Product Marketing, your job is to educate the potential customer about the product you offer, its value, and the benefits—before they purchase. If you inflate that too much, you'll build up too much expectation that your product may not deliver.
Remember: it’s always better to under-promise and over-deliver than to do the opposite.
In our space, CRM is so horizontal; it sells in more than one industry and is therefore focused on a range of business segments. (Whereas vertical tools serve specialized needs and don't serve a broader market.)
So, it actually takes a bit of work to show just how flexible of a tool Copper is, and how it can be molded to each customer's specific industry, business use case, and processes.
And then add in the fact that we have to do this early on in their experience before prospects lose interest or write off this tool thinking that it doesn't benefit them… let’s just say it’s a process that requires a lot of fine-tuning before you land that perfect Product Marketing recipe.
But once we build that relationship with a customer and are truly able to demonstrate to them the value they receive from our product—that’s what Product Marketing is all about.
You can’t stop churn, but you can control it.
So, for me, watching our short-term churn here at Copper is critical.
For example, I want to know what segments churn is highest in (company size, region, industry) or if the price was a factor so I can re-examine our pricing strategy relative to competitors.
This lets me dig deeper into the why—is it a bad product fit? Did our messaging and our product not line up? Does the use case not provide enough business value?
I also want to know about the timing of churn—was their churn in the first 30 days? Did they login to our product at all? If they did, what actions did they take (or not take) in the product before they abandoned?
Generally, I can break down churn into a few main categories. Here are three common causes of churn and how to tackle them.
1. Customers aren’t getting the full value out of the product.
This is when customers get the product but maybe don’t know how to apply it to their existing workflow, especially in our case—if they’ve never worked with a CRM before.
This starts after making the purchase. They don’t know how to use it, so they begin regretting the purchase—like they didn’t think it all the way through.
They might find it more cumbersome than their original way of solving their problems because of a lack of understanding the future benefits they’ll likely get from using the tool.
Of course, my aim is to make sure we’re getting the message right upfront before they buy and reaching out to these customers via automation or through a more hand-held approach to help alleviate their pain points before these thoughts of doubt come to their head.
We do this by proactively seeking out these customers to get feedback.
We find them through our reporting in Copper, which shows us which accounts have the lowest usage rates. From there, we’ll organize outreach to these customers and offer to walk them through the product again, or otherwise offer automated onboarding assistance and best practices.
Our marketing efforts and sales process are mapped out to match our product up with companies that are truly a good fit for Copper, so there’s always an effective way for our customers to use it. Sometimes they just need a little help getting there.
And once they’ve gotten there, both my team and the customer are happy. Win, win.
Learn about more strategies to reduce churn and keep customers longer with this handbook.
2. It’s a poor product/market fit.
Sometimes customers just haven’t figured out how to get the full value out of your product yet, which is fixable. But other times they’re just not a good fit for your product, meaning they’ll never get that value.
If Marketing is trying to max out lead quantity and not quality, and meanwhile your salespeople are hustling to hit quota so they don't sell to good-fit customers, the result will be churn—which your Customer Success team will have to deal with within a few months post-purchase when the customer realizes they can't achieve their goals using your solution.
In other words, selling to a customer who isn’t a good match for your product is a huge waste of time, energy, and money.
To prevent this, have a game plan. Don’t just go in with the intention of hammering out as many sales as possible. Especially in the subscription-based SaaS industry, this isn’t going to take you far when your customers are cancelling on you before you’ve broken even on the cost of acquiring them.
If your GTM teams are working as separate groups and not as one big team with a common goal of landing quality accounts, it’s time you re-evaluate your product marketing strategy.
3. Your user experience sucks.
Sure, everyone can “learn” how to use a product. But if the user experience sucks, they’ll never truly love it.
We want them to love it.
User experience is something we at Copper have heavily invested in regarding our design and product philosophy—which is why we've used Google material design principles to design ours. (Everyone loves the way Google works, right?)
A good UX is designed from the user's perspective. A bad one will lead end-users to complain over time all the way up the chain until it reaches a decision-maker at their company, who will be ready to switch to a new tool that the team actually wants to use.
And so the wheel churns.
First impressions matter, and the impression customers get from their first-time user experience (FTUE) is no exception. In the world of SaaS, you don't have too much time to wow customers as there are so many other solutions they can switch to.
So, it’s important to map out how users evolve with your product and how best to create an onboarding flow, messaging and highlight value early on that will have them better understanding how best to use your product for maximum ROI.
Then of course, there are the scenarios that you totally don’t see coming.
They’re getting value out of the product. Your success metrics are on point. They’re giving you positive feedback and all seems well.
Every product needs a Product Marketer.
Contrary to what many people think, Product Marketing isn’t a luxury reserved for established companies.
This is what a lot of companies get wrong. They’ll go for years getting by with their Product Managers, engineers and dev teams, investing all that money into developing products—then falling short on effectively marketing them to the world.
What should be happening is companies should be hiring a Product Marketer at the same time that they hire a Product Manager, so the two stay in sync from the conception of the product through to its delivery. This will ensure both parties know the product inside and out, and are always on the same page.
Basically: Product Managers develop products and know all the reasons (in technical terms) why they’re helpful to consumers. Product Marketers translate these technicalities into a value proposition and craft clear messaging to effectively deliver the product to the end user, and ensure they get the most out of the product.
Don’t let them churn on you.
Running a successful business isn’t just about landing new customers and making sales. It’s about connecting with new customers that are truly a good fit for your product or service, and putting in the effort to build a solid long-term relationship with them. (I’ll say it again: long-term relationship.)
That means you have to understand and care for customers throughout their entire journey—not just the acquisition stage. Once you’ve got this down, you’ll know exactly where churn’s bound to happen before it has a chance to, and be able to proactively tackle it.
You’ve got this.