Growth Hacks for SaaS Service: How to increase revenue and reduce customer churn?

  • Tutorial
Disclaimer : we, the Witget project , are developing our own SaaS service. We are trying to find and generalize the experience of older and more successful comrades. We present you a selection of useful growth hacks, prepared on the basis of materials from the KissMetrics blog , which will not only save users, but also stimulate them to pay more.

The larger the SaaS-based company becomes, the greater the threat to its subscriber base is the churn rate indicator (the number of users who refuse the service and freeze use). Even if the indicator can be kept at 2% - the larger the base, the more dangerous these tenacious 2%.

One of the leaders of cloud services formulated the problem as follows: “The larger the company becomes, the greater the struggle to reduce the churn rate resembles running on quicksand. The harder you strain, the sooner you will suck. ” True to be noticed, isn't it? Many people are faced with the fact that it is necessary to somehow increase momentum without causing discontent among subscribers. But how to do that?

Fortunately, for this there are working solutions that were used by reputable companies in various fields of activity and led to a win-win situation for everyone.

On the graph: a
characteristic distribution of the number of
regular, new and departed subscribers
depending on time;
shaded is a danger zone.


Squeeze everything out of the available options.
This refers not only to a reduction in the number of rejections of the offered services, but also to an increase in profitability. This can be achieved using the following recommendations:

Analyzedeparted subscribers and the reasons why they did it. One of the most common ways to get this kind of information is a farewell survey. It can be implemented both as part of the unsubscribe process and through a farewell letter. It is proved that polls are more effective in this case, although, of course, they require a slightly more complicated technical solution.

Separatesubscribers who drift to the side "looked to look out of curiosity" from the loyal and reliable. Alternatively, try to create a cohort database and look at the dependence of loyalty on various factors: gender, age, education, geography, etc., to better understand the nature of your customers. For example, it may turn out that people who work in large organizations in such and such directions, who love this and that, on average remain subscribers for a longer period of time than the rest. All the rest can be considered a risk group in the sense of the probability that they will refuse your services.

You must also work with a risk group. Suppose you call them and askwhat they would like: what functions, what opportunities. If customers cannot decide, then ask if they are interested in discounts, a webinar on the service, new chips, etc. The main thing here is to make the communication look like personal, because only then will it be possible to figure out what can be done to ensure that the client is satisfied.

Educate your subscribers about how they can benefit more from the services they already work with. This will reduce the chance of unsubscribing. You can select such subscribers as a special mailing group and send them additional answers to frequently asked questions, various kinds of memos and manuals - something that, in your opinion, will help to keep them and even turn them into your followers.

A large section of the blog specifically dedicated to educating subscribers to use your programs is something that should be a must. There are few ideas that work as well as offers for free to teach those who want it, but who are plagued by doubts. Some customers may not even know what opportunities (to which they have actually signed up) they do not use.

There are many educational methods that you can offer your subscribers:
• newsletters - something that directly falls into their inbox;
• cases are examples of using the service or step-by-step instructions on how to use the service in a particular case;
• a series of articles or blog entries that talk about what those who do not use this or that opportunity offered by you;
• infographics and presentations - brief squeezes with useful information presented visually and containing useful numbers, charts, diagrams and comparisons;
• workshops that talk about your products and the most effective ways to use them;
• Seminars on topics related to the industry as a whole;
• webinars;
• Training platforms or video channels on YouTube.

Encouragetheir subscribers for their activity and long-term cooperation. Talk about the possibilities of further upgrading to those who follow your instructions and are trying to more fully utilize the opportunities available in the current subscription.

Possible options:
- points for each visit to the interface,
- points for the total time spent in the service for a month,
- points for recommending to a friend,
- points for using the new option,
- points for the client’s desire on your site to indicate that he is yours uses - for this, prepare special icons,
- a reward for feedback, case, review, for ideas,
- reward for the time that the client devoted to you as a whole - for example, a gift for 1 year in the service.

Line up the service ladder
If you are a SaaS provider offering various levels of service, usually called “service plans”, it makes sense to use the following strategy: by offering bonuses when moving from one level to another, you increase your potential income from each subscriber and get a great opportunity to control the situation.

The upselling concept is pretty straightforward to understand. Make your customers see the real benefits of moving from one plan to the next.

Stimulate them by offering related products and services, a kind of add-ons that will expand their prospects and make you think about moving to a higher level.

Often, services offer to try a more expensive tariff for free for a while, so that you feel the difference, get used to it and then pay more.
The gain that the subscriber will receive from this should be clear and easy to implement. Therefore, you should thoroughly describe the differences, for example, between the Starter and Pro levels. In order for people to have a desire to pay, they need to nurture their respective needs.

Growth Hacks with price
1) Rates from left to right. Place tariff plans not in ascending order, but in descending order. That is, be the first to set the most expensive tariff.
Example. Callback Hunter

2) The choice of two, where 1 option clearly loses.Choose not 3-4 tariffs to display, but create artificial demand for the one that comes third in your plan in terms of cost, indicating only two paid tariffs on the site: the most expensive tariff and next to it a cheaper one in cost. But! The difference between them should be significant, and if possible, at times. And there should be no alternative.
Example. Bounce Exchange site.

3. Visualization of tariffs. Tell us for whom exactly this tariff is suitable - for a beginner or a pro, for an individual or legal entity. You can even imagine tariffs as images: a cat family, as in the CallBackHunter and MailChimp examples (below). Visualization will help you identify yourself with the type of client and make a decision quickly.
Example. MailChimp e-mail newsletter service.

four.Accents. Accentuate color and text. Play on a few human features. So, people do not like to make decisions, it is much easier for them to rely on the opinion of the crowd. Therefore, highlight one of the tariffs or write on it: "Best", "Hit", "Most Popular".
Example. Cloud hosting Digital Ocean.

Example. Survey Monkey Survey Service.

What you need to be careful of:
- too many tariffs,
- the ability to choose a tariff and add options for a fee - the conversion is lower if you give a choice.

good example. Tariff plans for the site builder Successfully allocated the desired tariff. It is marked with color, only the buy button on it, it is also brought to the fore.
All tariffs are provided with information about the benefits, about savings both in percent and in rubles.
It is reported for whom the tariff is intended.

Bad Example
Slack Service Rates . The benefits are not obvious. It is not clear what tariff is allocated. Questionable Enterprise rate with a floating price.

Interact - Put on the hook

It is important to understand, not only how to make the client stay with you and pay, but also how to transfer him to a more expensive tariff. The hook-and-drop tactic works great here. When the client is already “hooked” on your service, he likes it, the client is satisfied, then the probability that he will leave is low. But how to make him pay more? Here you need to play on growth factors.

For example, a service like Alyticstakes a percentage of the client’s advertising budget. This is quite obvious and understandable to the client monetization. But if you look closely, it becomes clear that you do not have to expect a big budget growth. On the contrary, the service is designed to reduce costs and optimize costs. Therefore, the company’s current income from the client will remain, but if there is a need to increase the average check, then you need to look for an opportunity in a different plane.
Typically, CRM give rates for the number of employees. But as practice shows, the number of employees in a company never grows sharply . As a result, companies have been sitting on the same tariff plan for a long time, without increasing the average bill. In this case, you also need to look for other parameters for growth.

Also, the error of some services is that their tariffs are set for impressions or units of goods. Website traffic to a stable company rarely grows by orders of magnitude. The number of commodity units also rarely crosses the boundaries of the allowable warehouse. Therefore, tariffs built on these volumes are not so effective.
Garpun tariff example.

What you can play on:
- on the growth of the base of subscribers / visitors.An example is the MailChimp service. In the free tariff it is possible to send letters to a certain number of subscribers, and then you need to pay. You also have a dilemma - or create a new account, but lose aggregate performance statistics and templates or pay. This tariff may also be relevant for agencies that have a growing number of customers that they connect.
Example. Pricing service Unbounce landing. Typically, these pages lead new users from advertising. Therefore, the repulsion from the number of visitors to this page is justified here.

- on the number of actions.SurveyMonkey survey service allows you to conduct one survey of 100 people for free. Usually we send the link through the channels and then people go through the survey. SurveyMonkey allows you to take a survey of 101, and 102, etc. But the data on them will be closed until you pay. You can also “cheat” and open the double of this survey, but then it will be difficult to reduce the data.

- on the growth of the volume of accumulated data.An example is DropBox cloud storage. You place your data in the storage - files, videos, images. At some point, you realize that there is not enough free space. Need to pay. And then the choice arises - either to leave, which means to transfer all the files somewhere else, or to create a second account to another mail (but you need to log in and out constantly to go to different folders), or pay. Most often choose the latter.
Slideshare works according to a similar scheme, which gives a limited amount of storage for presentations.
Example. Correct positioning of CRM tariffs by data volume.

- on the growth of appetites.First, we use a tariff plan for the Internet, which is rather weak. Then we start surfing the internet. But we are faced with the fact that there is not enough power to watch a short video and listen to music. We switch to a faster Internet. Then we want to watch big movies on the mobile or even distribute the Internet to a friend, if he is nearby. Then we take the next tariff. And so on. Putting us on the hook, service providers catch us on the fact that we are becoming more professional and want more. The next possibility follows from this.
Example. MTS tariffs. The reason why you need to move on is ideally shown, the tariff features are visualized (why use traffic). The benefit is also reported - cloud storage.

- additional options,which are not in other tariffs at all. Do not forget to let the client try new options so that he can evaluate them.
- points for the renewal of a more expensive subscription, which can be spent both on the services of the service (hours of consultations, expansion of the volume of space, etc.), and outside it. For example, in a store of complementary goods that are interesting to your customer.
Example. “Credits” from LivePerson Live Chat.

Communicate with customers
Perhaps it is time to get to know your customers a little closer, to penetrate their problems. We are not talking about the primitive distribution of questionnaires, which few people respond to, but we are not talking about personal meetings.

There are other options that can be compelling. If at the same time you have to sacrifice something, then so be it. Indeed, if there are no fewer failures from your services, you have to give all your best. Here are some examples of customer interactions that work successfully for many companies:
Surveys of subscriber satisfaction. Ask no more than 10 questions, think through them very carefully to deeper look into the psychology of the client. If you understand what makes your subscribers happy, you can offer them a more suitable product. We recommend Survey Monkey for these purposes.
By helping us, you help yourself.Explain to your customers that their complaints and recommendations will help you make the service better for them. The more they communicate with you, the sooner what they need will appear in the service.
Surveys in social networks with a lottery and bonuses . If you are a SaaS provider and have not yet launched a social marketing campaign aimed at keeping existing customers, you are behind the competition. (Welcome to the era of social media marketing!). A social media campaign focused on current and former customers is a great way to communicate with both in a more friendly format.
Branding campaign on social networks.Branding forms loyalty. Loyalty does not allow people to simply refuse your services simply under the influence of competitors, unless, of course, the reason is not in monetary difficulties. When you comprehend the reason for the increase in the percentage of refuseniks, having a streamlined channel on social media will be very helpful. This is your best tool for direct group communication with current, new and former customers.
• The ability to leave feedback or complain. Like every SaaS provider, you have customers who have questions. Many of these clients have neither the time nor the desire to use the usual way of communication - through a page usually called “Contacts”. The ability to chat online through chat or leave a review in a special form that is available on each page is a significant plus.
Services to use: UserVoice, UserEcho, Zendesk.

Summing up, we can say that the solution to the problem of increasing profits and reducing the number of unsubscribed is that you need to be active, experiment, try various options, as well as interact more with the client.

Editor - Anna Chashchina .

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