How does Canva nail user retention?

Whether you want to create a social media post or a presentation, you’d rely on Canva if design isn’t your thing.. Founded in 2012, it is worth over a billion dollars today!

Of course, they did a lot of right things — from identifying the right problem to solve to scaling and there is a lot we can learn from Canva. Let’s focus on how they retain customers.

Canva has the vision to allow everyone to create beautiful designs and it aligns perfectly with the demand in the market. Not everyone knows what compliments yellow and neither can everyone afford a designer. Hence, by allowing people such as you and me to create stunning designs for social media, presentations, infographics, etc, Canva lets people transform their imagination into reality.

Jobs to be Done Framework

Canva’s vision is based on the “jobs to be done” framework. Simply put, it means people come to a product for a specific purpose, or they hire a product to do a job. For example, a social media manager might use Canva to make Instagram posts while a job aspirant may use Canva to update their resumes. Both of them have a specific job in mind for the product. Hence, the framework shows how you can define your market around jobs.

Once you understand this, you’ll notice how everything that they do is centred around one job, i.e., being able to design anything quickly.

Before we jump into the actual techniques Canva uses to retain its customers, let’s understand the basics of customer retention in case you are not familiar with it.

What is Customer Retention?

Customer retention is the ability of a company to retain its customers over time. For Saas businesses, this would mean how many customers renew their contract at the end of their subscription duration. It is measured by comparing the number of customers at the start of a given time period and the number of customers at the end of the period.

Customer Retention Rate = (((# of Customers at the end of the period) — (# of Customers Acquired during the period)) / (# of Customers at the start of the period)) * 100

A good customer retention rate not only reduces your marketing cost but increases your ROI and brand loyalty. Existing customers are more likely to refer your product to their family and friends.

Now that you understand what customer retention is and how it impacts your business, let’s look at some of the ways that increase customer retention.

1. Freemium model: As Fred Wilson puts it, a freemium model is where you give your service away for free, possibly ad supported but maybe not, acquire a lot of customers very efficiently through word of mouth, referral networks, organic search marketing, etc, then offer premium priced value-added services or an enhanced version of your service to your customer base. The objective here is to get users hooked to your free product, motivating them enough to turn into paying customers. Hence, you guessed it right. In order to provide support and sustain your business, you should have at least one attribute in place for free users. Canva has an extensive collection of templates categorised by the type of platform, e.g., Instagram posts, Facebook posts, Facebook ads, Pinterest pins, etc. Free users can simply browse and select the category they are interested in. Further, Canva also has a huge collection of templates in each category that users can use in their designs. Although some of the templates are paid, there are enough resources available for free. Users can customise and download templates. Hence, there is little to no support needed for these users. As a result, the cost of free users is simply a database entry. Not only this, free users can pay a nominal amount if they’d like to use a paid template, thus, eliminating the need for sales and customer success teams here. Of course, they also have a pro and enterprise plan for individuals and organizations.
2. User onboarding: Customers use your product because your product solves a problem for them. Once the user comes to your product, focus on small wins. A lot of organizations bombard users with a list of features they have that could overwhelm them. Also, when you talk about all the different features you have in your product, you move the focus to your product rather than the user. You need to make the customer the hero and not your product. Users have a specific use case in mind when they come to your product as per the jobs to be done framework. It is your job to identify this use case. When you help the user solve a small pain point as soon as they come to you, you are setting them up for quick wins. By doing so, the user is not only motivated to solve their own problems but you also encourage them to explore your product. According to the BJ Fogg behaviour model, behaviour is influenced by 3 factors — motivation, ability, and trigger. When you help the user perform an action right when they come to your product, you motivate them to solve their problems. To create meaningful onboarding processes, you need to think about all the different user personas. If your product caters to three different types of users, think about their journey.

When you sign up on Canva, it explicitly asks you your purpose. Based on your selection, the onboarding process differs. If you select “small business”, they’ll recommend Instagram, Facebook, and other social media posts whereas if you select “teacher”, they’ll recommend infographics, presentations, videos, and so on. Of course, small businesses might also be interested in making an infographic but it is highly likely that small businesses will use Canva for their social media activity. Similarly, it is highly likely that teachers would want to make a presentation. Say, you choose infographics. You’ll then be redirected to the creation page with a blank canvas and a range of designs to choose from. Notice how Canva guides the user at this moment. Once you decide that you want to make an infographic, you’d want to know how to make one, e.g, whether you need to drag elements, how do you edit elements, and so on. Canva knows that this is the moment when the user needs guidance. If they tried to walk you through the editing process even before you decided that you wanted to make an infographic, you’d probably be overwhelmed and somewhat confused.

1. Personalization: Canva starts personalizing its content according to your needs as soon as you sign up. We already talked about the onboarding process that is personalized as per your primary use case. You’ll notice that under each category, they also have a “recommended for you” option that highlights the templates you’d most likely be interested in. For example, if you use Canva to post Instagram sale posts for the holiday season, they’ll recommend you similar templates. When you personalize your product for the customer, you make the customer feel valued. Great companies know that it is not about them but the customer. You need to make the customer the hero.
2. Customer education: By definition, customer education refers to a company’s ability in providing consumers with the information, skills, and abilities needed to become a more informed buyers. In order to find the value in a product, you need to be aware of the jobs you can accomplish using the product. Of course, you experiment and play around with the product yourself but a customer education program shows you the real value of the product. Naturally, when prospects understand the value better, the more likely they are to convert into a paying customer.

Canva’s design school is a great example of how to build an education platform for customers. From courses to how-to guides, the school has resources for everyone. Users can learn all they want about design and better use the product. For example, if you take the course Branding your business, you understand how each design element such as font, colour, tone, etc impact your messaging. You also learn how to choose the right brand kit for your business using Canva. So, the design school helps customers build trust and positions Canva as a market leader in design.

Not just products but Canva excels at marketing too. They hit all the right spots, from relevant email campaigns and targeting intent-based search terms to content marketing.