How Customer Research Solves B2B Churn
Why are your customers leaving?
Some SaaS companies have no clue. Yet, the solution is staring them right in the face.
Customer research is an underutilized tool in discovering why users churn. Teams fail to analyze user activity, onboarding engagement, and the competition.
Moreover, strive for retention. Research reveals that “the average ecommerce store generates 43% of its revenue from repeat purchases. At best-in-class companies, that number nears 80%.”
Sunil Gupta, co-author of “Managing Churn to Maximize Profits,” states, “What’s missing from traditional methods is that they focus only on a customer’s likelihood to churn, but not on the overall profitability of that customer.”
Empower your team to combat churn. And focus on consumer insight to retain more customers.
Why Research Matters
You don’t know what you don’t know. Research fills the gap between recognizing a problem and solving it.
With a simple hypothesis, you can test concepts and evaluate your target audience. You’re able to transform a guess into knowledge. And those data-driven strategies will move your company forward.
Research matters because it offers your team the opportunity to create the ultimate customer experience. To satisfy customers, you must understand their behaviors, needs, and wants. You need to know the why and how behind all their actions.
“When you understand the motivations driving your prospects and customers, you can reflect their feelings back to them (in their own words, I might add),” says Jennifer Havice, conversion copywriter at Make Mention.
Despite the importance of research, some companies fail to set up a system to derive insight from their findings. That’s an issue, especially when evaluating churn.
Some marketing and sales managers don’t even know why churned customers flock to the competition. Knowing why can be advantageous to halting churn before it actually happens.
Take the time to create a research process for your SaaS. It may center around improving the customer experience or the actual product. Meagan Timney, senior product designer at Inkling, writes:
“By committing to a process of prototyping, testing, releasing, and validating–known in the software world as ‘agile development’–you can make incremental gains, resulting in a much stronger overall product offering.”
Take your research seriously if you want to understand the how and why behind churn. Don’t let it get lost in a computer file labeled Miscellaneous.
Collect Data to Learn
Research is necessary. Now, what?
To pinpoint customer churn woes, your SaaS team must gather data. But before you start analyzing every spreadsheet in your company’s history, decide what’s important.
Revisit your buyer personas. Review your current customer profile. And examine your existing growth model. Understanding what you want will provide a clear path to earning results.
It’s also important to think of churn as an indicator of behavior, rather than just a number. Amy Gallo, contributing editor at Harvard Business Review, suggests that managers should ask themselves the following questions: