how to reduce churn for b2b saas companies

How to identify and target customers at-risk of churning

Rachel McBryde
Apr 2, 2020

Have you ever experienced a phone call with a customer that has your heart racing and your palms sweating?

For those of you who have experienced these phone calls, it's a commendable and hard place to be as you instigate a potentially difficult conversation knowing that its outcome could lead to a difficult scenario.

So, why go through it? Why should you instigate conversations with customers who are identified as “at-risk” to proactively reduce SaaS churn? 

How do you SaaS reduce churn?

In the B2B SaaS world, the significance of our customers' renewal in their contracts can help in a multitude of ways, from ensuring ARR to the potential opportunity of a referral strategy. Beyond the shadow of a doubt, it is more important than ever to lower SaaS customer churn and continue to use your product and services. 

From receiving feedback from churned customers to targeting companies who are at-risk of churning, getting as much information as you can help your B2B SaaS company reduce churn rates and increase customer satisfaction in the long run.

Feedback from churned SaaS customers

In 2019, we discussed churn as a part of 10 KPIs every B2B SaaS company should track. Ultimately, churned customers are customers who are no longer paying for your services and have ended their business relationship or transaction with you.

So, why is it just as important to gain feedback from churned customers as it is from ones who are currently in the twilight zone of your business?

  • You’ll strengthen the relationship between you and your customers in building trust; 
  • Find data that is crucial to helping your company progresses further in your services or product;  
  • Allow your customers to give you honest and valuable feedback, creating a positive force in making your product/service better;
  • Mitigate the risk of a customer churning.

Evidently noted on hubspot too:

“It's also easier and more cost-effective to retain customers than to acquire new ones, returning customers spend more and buy more often, and refer friends and family.”

So how does a B2B SaaS company categorize an “at-risk” customer? 

Reduce SaaS churn proactively by targeting "at-risk" customers

Depending on your business model, how you define “at-risk” is open to your interpretation, but most importantly, agreed upon by everyone in your team who knows and has had interactions with customers who have churned. So sit down with your team, and brainstorm a set number of criteria that is agreed upon. 

Blogs such as  7 examples of signs to consider or SaaS churn threats are just some great thought trains to consider when conceptualizing your “at-risk” customers.

Ultimately, just as you would identify an Ideal Customer Persona, you’ll need to identify and segment similar customers who you’ve known to have already churned and create themes based on these customers. Once created, you’ll be able to go through your current customer basis and pick out customers you’d consider to be “at-risk” of churning. 

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