“Customer experience will overtake price and product as a key differentiator by 2020.
” – A Walker Study
In the age of technological progress, customer experience is one metrics all businesses, especially SaaS companies, need to pay attention to. The pace of rapid change and the rising speed of innovation is making it increasingly difficult for SaaS companies to create and maintain a competitive advantage. The very nature of SaaS products is such that the customer is continuously evaluating it – weekly, monthly and annually. Switching products has become easy.
Customer engagement is also a valuable metric in the SaaS universe as:
- It is 9x cheaper to retain existing customers than acquire new customers, costing $0.13 to acquire any additional dollar of revenue – Source
- 86% of SaaS businesses treat “New Customer Acquisition” as their highest growth priority- Source
- Best-in-class SaaS companies achieve 5-7% annual revenue churn – equivalent to a loss of $1 out of every $200 each month – Source
- The median monthly revenue churn for large SaaS companies is 0.75%, translating into an annual revenue churn rate of 10% – Source
- 50% of paying customers log in to their SaaS service less than once a month (or not at all) – Source
To drive growth, SaaS companies have to drive usability. To do so, they have to connect with their consumers in meaningful ways to showcase the ‘value’ that the product is providing. Here’s a look at how to do that
Focus on personalization
Users have to be introduced to the new age of ‘Personalization’. Let’s call it Personalization 2.0. And this personalization does not mean just sending emails with the individual’s name on it.
Given the sheer number of SaaS products available today, the consumers expect a high degree of personalization that extends across the entire product lifecycle. This means the personalization experience has to start from the onboarding process and has to extend to how the product is being used. Every single interaction that the user has with the product has to be personalized. The objective of personalization is to provide a hyper-contextual experience that shows the user that the product is tailor-made to suit their needs.
Customer engagement is an ongoing activity
SaaS companies have to realize that customer engagement is not a one-time activity. The focus of customer engagement activities does not end at onboarding and is not relegated to news regarding product updates and updates.
Customer engagement initiatives have to go beyond these, and companies need to identify ways of connecting with the user based on their journey. And this engagement has to happen within the product. Right from proactively sending them the right training material, updates, upgrades, marketing content etc., every piece of information exchange has to be contextual and relevant to the customer based on her product usage and product journey.
Break down the silos fragmenting customer success
The objective of customer success for SaaS products is to take the user to that ‘aha’ moment in the shortest possible time. Many stakeholders contributing to customer success who operate in silos makes customer engagement a fragmented experience.
With silos dividing teams contributing to customer success, no one gets a 360-degree view of the customer. The information exchange that can enable seamless interactions thus does not happen. What SaaS companies need to do is provide all the stakeholders of customer success, the product engineering teams, the marketing teams, the finance teams etc. a consolidated and comprehensive 360-degree view of the customer. With the right data at hand, these teams can connect with the customer at the right time, when work happens and thereby push enablement closer to work proactively.
Driving communication value
“Content is king, but context is God.
” We cannot emphasize the importance of this statement in the SaaS universe. With so much content vying for the customer’s attention, your update email is just another piece of communication that is delivered to the customer. How can you make it more?
Value can be driven only by contextual communication…communication that is relevant to the customer…. communication that has solutions to their problems or will help them achieve their end goals better or faster. SaaS companies do gather a lot of data on their customer but what good is that data if it does not deliver the right actionable insights. With the right insights that come from usage data, behavior and sentiment analysis, companies can hone their communication with the user. They can then align their communication with what the user wants and address all their implied and explicit needs. Such communication has value in the life of the customer journey and helps the customer connect with the product in a more meaningful way.
In a nutshell, while creating a great product is essential, it is time that SaaS companies pay attention to how they deliver value to their customers, deliver meaningful experiences, create enablement where work happens and deliver deep and continuous customer engagement in a device agnostic manner.
Connect with our team of experts to see how you can achieve this and more with your SaaS product.