Keeping churn rate to an absolute minimum is a priority for businesses in order to achieve and sustain growth. Here’s how a live chat platform can help!
Churn rate is the percentage rate at which customers stop using a company’s product or service. In many cases, the reasons that make customers decide to stop using your product or service are out of your hands. Like they say “it’s not you, it’s me”. But when it’s a matter of customers feeling let down by your service, that’s when you can – and definitely should – do something about it.
For companies that provide software as a service (SaaS), messaging has assumed a pivotal role, and live chat platforms can be a great resource for helping to reduce churn rate. Live chat can not only help at the top of the sales funnel with lead capture, but also help with nurturing and retention by keeping customers connected, building up your users’ loyalty from the moment they engage with you on your website.
Here’s 3 ways you SaaS companies can use a live chat platform to lessen customer churn:
1- Re-engage customers with auto messaging
One of the most common reasons driving customers to stop using a product is disengagement. While some customers can make a sudden decision to leave your service, what often happens is that they gradually disconnect.
User activity is a key indicator for future problems – customers who aren’t active with your product are most likely losing interest, and they are at risk of slipping away. It’s therefore important to keep an eye on activity, get feedback and keep communication alive.
Talking to your customers is key: it’s the most effective way to keep them interested and engaged. This is where messaging automations play a huge role.
Automation workflows can help you to set timed messages to be delivered to specific people, at the right time, to prevent leads from falling off the radar and customers from losing touch. It’s important to segment your audience and chose the right messages to deliver that can re-engage inactive customers.
When adding links on your emails and messages to your web pages, you can use live chat to prompt auto messages in a personalised way. Greet your customers with a tailored message and invite them to talk to you. Messages like “we missed you!” or “glad to see you back!” can go a long way in showing customers appreciation and help you to re-engage them.
2- Integrate live chat into Your SaaS App
You will have noticed the numerous websites featuring a little chat bubble stuck in the corner, ready for visitors to reach out if they have a question (yup, there’s one right here too!). But why are there not more chat widgets inside SaaS products?
It’s about time SaaS companies realise the true potential of instant messaging; take customer support to the next level and facilitate communication via live chat, right from their application products.
Integrating live chat in your app means your users can reach out to you at the very instant they encounter a problem, to potentially get instant help. Getting help in real-time is the way forward to provide great user experience and maximise customer support.
Enabling instant communication from the app allows SaaS companies to solve problems quicker, giving customers more reasons to stick around.
3- Keep track of customer satisfaction rates
A crucial step to reduce churn rate is keeping track of customer satisfaction rates and gather feedback regularly. Feedback is a great resource for gaging satisfaction and improving churn rate.
Customer surveys are incredibly valuable to collate the insights that you need; identify customers expressing disappointment and react to keep satisfaction rates on a high note.
Live chat platforms with help desk and customer service features usually include feedback surveys and reports based on satisfaction rates. Making the most of these tools can help you to keep customers happy and reduce churn rate.
The importance of investing to mitigate churn
Churn is directly related to burn rate, so when thinking about the impact of churn and how to mitigate it, businesses must put things on the balance and compare all costs.
The greater the churn, the more capital is required for the business to simply maintain revenue. SaaS companies must balance growth, churn and cash for working through maximum viable churn.
In general terms, SaaS startups can afford to invest significantly more in retaining customers to improve churn rates, because retaining existing customers is less expensive than finding new ones. Moreover, investing in customer success to grow existing accounts can be a more cost-effective way to reduce churn than increasing spend for new customer acquisition.
When considering how much it should be spent on managing churn, Tomasz Tunguz has evaluated SaaS benchmarks and estimates that companies can spend up to 3 months’ worth of contribution per customer on churn management.
Though this can serve as a guideline for many subscription businesses, it will really be down to each company’s variable metrics.
Get your hands on the latest messaging tools to turn the churn around and retain more customers. Sign up with Ibby today, as one of our early adopters you’ll get started with a 3 month free trial!