In this episode of Metrics & Chill, learn how ProfitWell grows one metric that’s crucial for both them and their customers: revenue per customer.
Metrics & Chill Podcast | Apr 16
Kiera Abbamonte on March 19, 2021 (last modified on March 25, 2021) • 4 minute read
Chris Cardone, Customer Success Lead at Unstack, talked with John Bonini on an episode of the Metrics and Chill podcast. Chris shared how Unstack approaches one key metric that’s crucial for SaaS businesses: Churn.
A no-code marketing platform that allows marketers and entrepreneurs to launch and scale a business more quickly, Unstack needed to better understand the underlying reasons why customers churn. To do that, they built a robust, proactive, and standardized process for diagnosing and fixing churn.
Read on for more details, or listen to the full episode here:
The metric Chris and Unstack have been focusing on a lot is churn. As Chris explained it, “Customers who were really great fits for us were churning. That wasn’t a good signal to us. We thought, ‘That’s preventable.’”
After looking at their churn rate and involuntary churn in particular, Chris and team zeroed in on one aspect of churn they could proactively fix right away: Involuntary churn.
“We looked at involuntary churn—where churn comes from a payment failure—as an area we could quickly resolve and fix,” Chris explained.
Beyond that, the team knew they needed a mechanism for better understanding the reasons behind voluntary churn.
Chris knew that fixing that involuntary churn was the simplest, fastest way to eliminate a chunk of their churn.
“In the B2B industry, involuntary churn is at 1.39%. For us, about 3% of our churn was involuntary,” Chris said. “That’s a whole percent of churn that we could completely prevent just by having systems in place that alert the customer success manager when a payment has failed.”
That was Opportunity #1.
Opportunity #2 relied on putting a system in place to help them centralize data on churning customers and standardizing a process for identifying common sources of churn. By doing so, the team saw a huge opportunity to meaningfully reduce churn.
Once they zeroed in on churn, the next steps became clear.
They could immediately eliminate a sizable chunk of involuntary churn by setting up a constant monitoring system to alert customer success agents when a payment fails. From there, the customer success team could proactively reach out to customers on a human-to-human level, alerting customers to the payment issue and helping them right it.
The next step was to build a system for understanding and getting proactive about the other churn—the voluntary kind.
“The first thing we did when we were experiencing all this churn is we talked to people,” Chris said. “We standardized a form of what we wanted to ask people. We asked the right questions—we standardized the churn process.”
According to Chris, centralizing the resulting data and making it accessible across the team was the key to identifying trends in churn and addressing them head-on.
“It’s accessible to every single C-level on our team, every manager who needs access to it,” Chris explained. “So they can constantly review that and see where it’s leaning for this month.”
As an example, Chris added, “[The form] provided us information that education was a missing sector—so we developed a lot more educational materials and became more proactive about the distribution of them.”
Now that the system is built and standardized, the team approaches the resulting data as a kind of rolling, constant feedback.
“We implemented constant monitoring,” Chris said. “One thing we found about a lot of customers who churned is their activity on the platform was slimming a lot in the last month. So we set up monitoring to be able to see when a customer was falling off the trail of activity, so we can be more proactive in reaching out to those customers.”
In short, the team uses trends in their churn data to take concrete, proactive steps to avoid future churn.
“We’ve been able to leverage our data to prevent future churns. You can save one churn by analyzing that one specific churn and having a very specific outreach. Or you can use it to then prevent further churn,” Chris explained.
Right off the bat, Chris and Unstack saw improvements in involuntary churn. “We have decreased involuntary churn a lot by having a human get involved proactively. It was a quick win, especially having a person do it.”
In most cases, when a human customer success agent reaches out about payment failures, customers are able to fix the problem in less than 24 hours. Boom—churn unchurned.
As for voluntary churn, Chris said, “We’re always looking for rising reasons for churn that are coming up. Having one form that every single piece of churn has to go through is really beneficial in being able to notice, ‘Hey, this feature we’re missing is actually starting to cost us dollars.’”
“Our metrics are still being measured year-over-year,” Chris told John, “but we’re already seeing churn lowering from month-to-month.”
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