Stay Connected

Congrats! You’re subscribed

  • Facebook Classic
  • LinkedIn App Icon
  • Google+ App Icon
  • Twitter Classic

Onboarding: Why you haven’t finished your job as soon as you got that customer.


The hidden costs of keeping SaaS clients

Getting a customer to sign up and pay isn’t the end of the job. It’s the beginning. As we mentioned in a previous blog post , the simplest way to increase your customer lifetime value is simply to keep your customers.

Once you get a client, you need to keep a client. The tips below are just that – tips. You know your business better, your customers better, and hopefully have developed a comprehensive marketing plan with a thorough understanding of your target market.

If you’ve done that, all you need to do is remember that the job isn’t done when the customer has been acquired, but rather you need to work hard to keep your customer each and every day.

In the old world of business, once you got your money, you didn’t need to worry. They were locked in for multiple-year contracts, and very hard to get out of. Even if they managed, switching costs were high and the competition was just as bad, so better to accept vendor-lock in.

In the new world of business, customer delight is the key to profits. Specifically, in Software-as-a-Service (SaaS) business, when the customer can simply cancel you at the end of the month, or at worst after a few months.

One example of a company that went bust is 2e2. They provided IT managed services and integrated technology solutions across the UK, Ireland, Spain, Benelux, the Channel Islands, the Isle of Man and the US, plunged in January 2013. Learn from their mistakes – Sam Simpson a former employee shares his story one year later here.

Today, you need to not just worry about getting the customer a vested company with active acquisition is, but also keeping it. The most important way to keep a customer is to plan through the entire customer lifecycle – not just purchase but rather through the entire customer decision journey.

Whereas before customer acquisition was a funnel: from research to purchase, today, McKinsey has defined the customer decision journey. Unlike the linear funnel, the customer decision journey is circular: “initial consideration; active evaluation, or the process of researching potential purchases; closure, when consumers buy brands; and post purchase, when consumers experience them.”


That post-purchase phase is just as important.

Here are some tips. I’m sure others have more – leave your tips in the comments:

1. Don’t overpromise and under deliver

There’s a reason used car salesmen have bad reputations. Once you trick someone in or don’t fulfill their expectations, they won’t continue. Even worse, they will tell their friends who will tell their friends – to avoid you.

It’s really simple: treat people like human beings. Don’t go after the quick wins but long-term losses.

2. Offer trials

Don’t go after one month of income but forgo years. Offer demos, free trials of at least a month, extended periods of time. Once they are already using your product – even for an extended trial period – they are likely to continue. If they don’t start, even for free, they might never start.

3. Pay attention to first impressions

Your first experience with your product defines how your customer experiences it. Behavioral economic studies show that we are influenced by our mood.

You need to pay attention to user experience, ensuring your product is easy to use, solves their problems, and doesn’t pander to them but also doesn’t overwhelm them.

4. Provide good service and quick page load times

Your website too complicated to navigate? Take too long to load? Even a 2-second delay in load time can lead to an 87% page abandonment rate. Watch all the JavaScript and tracking. Optimize your code and don’t let legacy code and bloat ware get out of control.

5. Don’t misunderstand your customer.

You aren’t your customer. You don’t know what they need. Assumptions may not be based in reality. Test, validate, and test some more. Data analytics – both quantitative and qualitative – need to be utilized to answer the right questions and validate assumptions.

6.HIPPOs aren’t always right

The HIPPO – highest paid person’s opinion – may sign your paycheck, but that doesn’t mean that they are experts in funnel optimization. While testing and experimenting have an important role in any SaaS (or business for that matter), just doing what the boss says or throwing spaghetti at the wall and see what sticks is not the best way to retain customers. Instead, you waste time and money while losing customers running activities that weren’t based on your customers’ needs and market research/validation.

7.Solve the user’s needs, don’t bombard them

Your user doesn’t care about every feature you have. They aren’t going to spend hours of training (or even an hour) unless it meets a need and solves a problem. Otherwise, less is more. Let your customers solve their problems with your product simply, easily, seamlessly, and with as few choices as possible. If you overwhelm them, they are likely to leave.

8. Follow up

If there’s an issue, make sure your customer support team is promptly following up with them, trying to understand and solve their problem, and then follow up.

Are you sending a monthly newsletter? Auto responders and marketing automation? Customer site visits and periodic contact with management?

9. Bonus Tip and probably one of the most important!

Monitor closely the retention- you can't manage what you don't measure

Keep your customers. Make them happy. Don’t stop earning customers after that first sign up.

Bonus Tip and probably one of the most important:

Monitor closely the retention- you can't manage what you don't measure