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Biggest Mistake in SAAS Retention

Jacob Brain


If you are reading this post, it’s likely that you are working to customers engaged and subscribed to your SAAS product. As a retention marketer, your key task is to keep churn down and revenue growing by not letting your customer sneak out the back door undetected. But many of you might be committing the biggest mistake in customer retention for SAAS products. Ready to find out what it is?

The biggest mistake in SAAS retention (and maybe even in SAAS marketing as a whole) is the lack of personalization. Why is that so important? To unravel this ball of yarn we have to start with why personalization is so vital to your product.

The Needs Approach to Buying

Why we buy has a lot more to do with our needs than it might seem. If we take a look at the chart below, it outlines Maslow’s heiarchy of needs. This structure of needs serves as a guide to inform us about why we buy the items we buy, and how it relates to the needs it fills across this spectrum.We don’t buy iphones and BMWs because we need a car or a phone. The needs these items fulfill extend higher into our sense of self, and our place in society. Our values, culture, and sense of belonging to the race as a whole are defined in the purchases we choose to make. So in many ways we are defined by what we buy. Or at least we hope so.

So when someone detaches from a product or subscription service,  we should look at the same needs the item fulfilled when the product was purchased to see what went wrong. We could look at the physical attributes or basic needs the product served, but many times there are other needs at play. The truth is that your SAAS product not only fulfills some tactical or basic needs, it also fills some emotional needs higher up the hierarchy. And in the customer experience many marketers neglect this hidden contract with the consumer that your product is doing more than providing a service. It’s providing an avenue to the experience of this person’s daily life.

You Never Knew Me

So like it or not, your product or service fulfills more than the feature set it provides to a user. It makes their life easier, or worse, and it can ruin their day if it’s not working, or give them the joy they desire if it’s working right. And there is no better way to link these interactions with your product than with the development of a relationship through personal acknowledgement. When there is personalization, it starts to mimic the attributes of a relationship which is at the center of the hierarchy. Establishing the relationship works to develop a basis of safety and security, as well as providing the basic features of your product.

True personalization is how SAAS applications build relationships and start to extend up the hierarchy into areas harder to dislodge from our needs. We develop trust in relationships, we gain esteem in our relationships, so it makes sense that the core goal of a retention marketer is a real relationship with your user. And your avenue for creating that is personalization. Not just settings, but real feedback and intelligence that reacts to a user because relationships are two-ways. We’ve written about this in Reactive Marketing, and Why Orientation Campaigns Matter, if you want do dive in more. But to summarize, building this deeper relationship is paramount to the success of your SAAS application.

So take this to heart, and look to revamp your retention process so it focuses on the relationships you are developing with your customers. The biggest mistake is to think of it as a one-way street and ignore the relationship your customer wants to have with you.

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