We've explained why it’s important for you to think about renewal as an organic part of your growth strategy. After all, it costs five times more to acquire a new customer than it does to retain one. So knowing that, who wouldn’t see the value in making retention and renewal part of their long term growth strategy?
And you’re on board with this concept. But still. You figure you’ve got your sales team on renewals. Or maybe you’ve got a crackerjack team of customer success account managers and as far as you’re concerned -- they’ve got this. And that’s great. They’re probably amazing at what they do. But they can’t spin renewals out of whole cloth.
To help your team members do their job at peak efficiency, you have to lay the groundwork in the form of ongoing targeted customer reminders and triggers. You need to consistently remind your users of the value you provide and successes they’ve achieved -- and help them achieve greater and greater success -- if you want renewals to be a foregone conclusion. in the words of customer success expert Lincoln Murphy: “The mindset of Customer Success and properly aligning processes – including email follow-up – is critical to the success of a modern SaaS enterprise.”
What do we mean by targeted reminders and triggers? Well first, let’s talk a little bit about your customers’ psychology. Trust us -- it’s relevant. For your business to succeed, you want your customers to interact regularly with your product, become avid users, and go on to renew. Essentially what you’re asking them to do is to adopt a new, consistent behavior. And to get them to do this, you have to understand what’s necessary to change behavior. To do this, three factors must be present: motivation, ability, and a trigger. In the SaaS world, that breaks down like this:
- Customers must be motivated to use your app. They must have a clear understanding of the value you can provide and how this product will help them make progress in a job they are trying to do. You can convey this in many ways. One important opportunity to do so is during that amazing onboarding experience we talked about in part one, and by then providing continuous value and successes.
- They must have the ability to use your product. Again, this is on you: Monitor engagement, remove struggles and obstacles, and facilitate their ability to make progress in the job they’re trying to do.
- Customers must be triggered to use your product. At their most basic, triggers serve as reminders to perform a behavior or an action. But they can be much more than that. If you carefully target and time your triggers and reminders, they can not only nudge customers to use your product, they can also remind users of the unique value you provide. Well-crafted triggers -- whether via emails or in app reminders or push notifications -- can increase your customers’ motivation and ability, in turn creating a trifecta of success. When it comes time to talk about renewal, those types of value reinforcements will help people remember how they derived value from the app -- increasing the odds that renewal will feel like a no brainer.
In order for you to correctly target these triggers and reminders to your customers, you have to know why and how your customers are using your product. The why comes back to the job they're trying to do and how they define success. The how is the nitty gritty of their usage: What actions are they performing? Which sections of the product are they using? (or not using?) Where are they encountering obstacles? Where do abandon the product? Where do they go deep, indicating places you could provide even more value?
With these types of ideas in mind, here are some tips to maximize your triggers and notifications to increase the chances your customers will consider renewal a no-brainer
- Customers who log in but don’t get very far. These customers seem to have motivation-- they’re logging in regularly, after all. But they may be lacking in ability to extract the value you want them to experience. For these customers, a trigger should include helpful instructions or tips to get them over the hump and remove whatever struggle they’ve been facing as they try to make progress. You should also explain the value and success they’ll achieve.
- Customers who don’t seem to have a problem with the mechanics of interacting with your product but don’t log on regularly. This indicates low motivation with an adequate or high ability. There’s a good chance they just aren’t seeing the value you could provide. Triggers and notifications for these types of customers should clearly lay out, in quantifiable terms, the value they’re missing out on, along with tips on easy ways to succeed.
- Customers who use your product, extract value, and succeed regularly. Don’t neglect this group of highly-engaged users! Send triggers to remind them it’s time to use your product, of course. But also show them the successes they've had. Quantify what they’ve accomplished. Explain how they could extract even more value. And consider occasionally rewarding them with things like a free feature, a discount, or a free month of usage.
No matter what pattern of behavior you’re targeting, your notifications and triggers should always be linked in some way to value and success. If you keep these concepts uppermost in your customers’ minds, you’ll help them see the value in a renewal.