Customer Churn During a Pandemic: What SaaS Companies Need to Know

A crisis is a time for Customer Success teams. In situations such as the current COVID-19 pandemic, your CS team can take action to prevent customer churn during the pandemic while also helping to build a sustainable future for both parties once the danger passes.

Through constant, customized communication, reviewed and honed business goals, and a platform that collects data and makes it actionable, your Customer Success team can lead you through this once-in-a-generation challenge. You will want to focus on the following areas:

  • Stay Agile As a Company
  • Evaluate Your Customers’ Exposure
  • Revisit Customer Goals
  • Communicate and Provide Value
  • Leverage Customer Health Scores
  • Evaluate and Iterate Your Process

One of the most important ways to reduce churn and stay relevant to your customers is to make sure your team is as flexible and agile as possible.

Stay Agile As a Company

The current COVID-19 pandemic has not been kind to many industries, and SaaS is no exception. In March of this year, SaaS stocks reached a 20 percent decline from their selling highs. Business IoT has experienced a growth rate down 50 percent from the previous year, and the subscription growth rate for small businesses also fell by half.

The current downturn makes it vital that you work to defend your core revenue. Customer retention is the primary function of your Customer Success team, so now is the time to ensure your team has the tools and support they need to continue delivering value to your customers. Your business will need to be agile in order to pivot quickly as circumstances change in this rocky period. Agility in messaging and in the tools you use to collect and act on customer data are crucial.

Evaluate Your Customers’ Exposure

The pandemic is depressing the overall economy, but there are some industries that are seeing increased demand. Communications SaaS companies have watched the growth rate of subscriptions rise by 1.4X.

Segmenting your customers according to the way they’re affected by the current situation will help you provide the right kind of assistance for each.

Communicate regularlywhen you can offer valueand use Voice of the Customer (VoC) tools to find out how your customers are faring during this time. Segmenting your customers according to the way they’re affected by the current situation will help you provide the right kind of assistance for each through targeted messaging and personalized support.

Whether your customer is affected negatively or positively, however, it is important you address the changed environment and help your customer reevaluate their short- and long-term goals.

Revisit Your Customers’ Goals

Goal setting is a great way to introduce momentum to a new partnership and maintain it during an enduring one. It lays out a clear definition of success and creates an expectation of approaching value. A downturn such as this, however, may make some goals irrelevant. Get in contact with the key contacts on the account to review goals and how they may need to be adjusted, what your customer’s new goals might be, and what they need to get accomplished this week versus next month. Collaborate with your customer to establish a timeline and milestones for achieving realistic goals in this new economic environment.

Communicate and Provide Value

One major thing your Customer Success team can do to prevent customer churn during a pandemic is to reassure them of your own continued availability. Reach out to let them know the status of your products and services and be honest about any changes or compromises during this time. The following three goals can support your communications efforts right now:

  1.   Optimize internal communication: Your teams should be able to collaborate and provide support to each other easily. For instance, your product team should be able to see features that are getting less usage in order to make usage simpler or create how-to-get-started articles. Marketing should also have visibility into customer data so they can promote more training events, best practices, or quick how-to videos to drive engagement.
  2.   Emphasize digital options: Lead the way by offering the latest in digital solutions that can deliver additional value. Offer customer forums where your customers can find community and share resources, offer webinars that present practical solutions to common pain points, and provide video tutorials to show updates and help train users on new features.
  3.   Communicate frequently: Do not make your customer reach out to you for answers. Engaging closely with your customer will bolster your relationship and provide an opportunity to promote new product features and practices that could help. To avoid overwhelming your customers, ensure every communication adds value, instead of just cluttering their inbox.

Regular communication is vital in maintaining a relevant presence in your customer’s business life during a time of great change. 

Leverage Customer Health Scores

Knowledge is power. Use a customer success platform that allows you to connect multiple data points in one place to provide a real-time, 360-degree view of how your customers are doing today. Review the metrics that go into building your customers’ health scores, such product usage and adoption, license utilization, business results, engagement, and advocacy, and ensure they are properly calibrated for the current environment. Your customer success platform should gather information from a wide range of sources and make it available across your enterprise so that each member of your team has access to data about the health of each customer.

Evaluate and Iterate to Reduce Customer Churn During a Pandemic

There isn’t much you can control during a pandemic, but you can take action to deliver customers the right value at the right time, provide guidance to your team, and iterate as you continue to learn more. Avoiding churn is about being able to continually adjust your—and your customers’—approaches in order to create value. The right customer success software can reduce customer churn during this pandemic by making it easy to be agile and responsive to your customers and the environment.

You can’t afford to keep waiting, start taking action today for free. Totango’s flexible, fully customizable customer success platform lets you create a customer-centric enterprise around your customers.

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