How 10 Startups Actually Use Customer Feedback to Reduce Churn
Industry leaders share how they stop their customers from leaving
If you’re leading a SaaS company, you’re thinking about churn. I’d bet one of your biggest problems is reducing it or keeping it low.
Well, of course, your product is important. If you build a product your customers love, they’ll stay.
But at the heart of any great churn strategy is customer feedback. In developing our product at Savio, my team and I have spoken to hundreds of companies about how they collect feedback and how they use it to combat churn.
Here’s how these leaders actually use customer feedback to eliminate churn, as well as advice you can implement yourself.
1. They use customer feedback to build a stronger relationship.
Alan MacLachlan, CEO @ Improves
If you’re lucky enough to get feedback from a customer, you must act on it. Good or bad, it’s your chance to improve the relationship with your customer.
If it’s good, say thank you. Tell them how much you appreciate it. Make sure you acknowledge it. They have just taken time out to help you—by dropping them a simple reply saying “thank you” you’ll build the relationship and vastly increase the potential for future sales. The stronger the bond you have with the customer, the less likely they are to go elsewhere.
If it’s bad, do what you can to help them. Make sure they understand you acknowledge the problem even if you can’t do a lot about it. What is important is how you deal with it. Don’t make it hard for a customer to contact you. Clearly go out of your way to help. Offer refunds, replacements, or whatever, but try and go the extra mile where you can. You can turn a bad situation around and give them a positive experience. You might just save the customer.
At the end of the day, my best advice is this: think to yourself what would you want if you had sent the message you have just received? What would you like to happen? That is almost always the best solution.
2. They use it to figure out what else their customers need.
We had a big churn problem early on. Customers would use our product, reach their goal and then churn. We realized that we had to ask, “What value can we bring to you when you’re done using our product?” Using that question, we unlocked two value propositions that were adjacent to our offering. Together, those two changes increased our average customer lifetime from 3 months to 18 months.
We used to run automated drip campaigns to get users to re-engage, but realized that getting their feedback was more valuable. We’ve since switched to having a team member manually email a personalized message to each user who didn’t activate. This has instilled personal ownership of feedback collection in the team, and the personal touch and extra motivation have uncovered great insights around our top of funnel messaging and clarity of value proposition.
One way of using customer feedback to reduce churn, improve customer experiences, and help a business’ growth is to use customer’s input to the fullest when developing or redeveloping products and services.
3. They use it to make customer service more effective.
William Cannon, CEO @ Signaturely
We’ve invested in resources, technologies, and integrated sales processes to facilitate the interface between our employees and customers. Having a platform that centralizes information and a set of standardized and structured procedures makes customer service and experience much more effective and positive, with the lowest level of friction possible.
At the same time, you can use this infrastructure to track customer success metrics and ensure alignment of objectives, frequency of deliveries, and that there is overall satisfaction among your customers.
4. They use it as an excuse for face-to-face interaction
Julian Goldie, CEO @ Goldie Agency
Technology and automation are great allies, but we’ve found that offline experiences also count. We try to be close to our customers, get in touch frequently, and ask for feedback on the progress of the project.
The key, for us, has been to invest in more face-to-face interaction. Remember that a solid relationship is built over time and your initiative is important. So don’t expect your client to come up with a complaint to think about how to serve you better: schedule alignment and relationship meetings. Show your customer that you care about your business and your success.
In this way, they will feel unique, well attended, and important to your company—and they will stay.
5. They use it to nurture use among their most important customers and build a better product.
Karthik Subramanian, Senior Content Manager @ Picmaker
We are a B2C company, and a lot of our customers use our product once and may not come back for a while. But, what we do is figure out who our top users are, and nurture them enough to appear for a 15-minute interview with us. And, we send them a prepared set of questions such as what features they like using in our product, what would they like more in our product, etc.
Then, we ensure that we:
- Capture all their feedback in an excel spreadsheet — We populate an excel spreadsheet with everybody’s feedback and share it with our product development, IT, and UI/UX teams so everybody knows what our customers are saying.
- Save their videos — All customer interview videos are shared with product development, IT, and UI/UX teams — because no matter how much written feedback we share, videos are extremely powerful. Especially, when somebody is critiquing our product, a video can help get your point across more effectively.
- Include their feedback in our sprint — We ensure that when we gather user feedback, we include it in our new product development sprints so that our product evolves in the same way that they want it. As product owners, we are biased and we really don’t know what our users want unless we speak with them on a one-on-one basis or through a survey.
- Communicate about the new feature launch — Once their desired feature goes live, we send them personalized emails asking them to try it out. If they feel that the new feature isn’t still as impactful as they desired, we go back to the drawing board again and fix it until it works fine.
This has helped us reduce churn significantly. We still look at customer usage data, but customer feedback has helped us immensely in the evolution of our product.
6. They use it to identify friction points—and fix them.
Borja Prieto, Head of Growth @ FROGED.com
When using a product-led growth approach, customer feedback is critical to help reduce churn.
First, you must define how you’re collecting feedback from customers. At FROGED we have 5 ‘channels’:
- Features requests feedback
- We ask for feedback when someone cancels its account (cancellation flow)
- Customer Success and Support teams feedback
- NPS Score
- CSAT Score
When we have a cancellation, we analyze that feedback, find the most important friction points, and then work to give them a solution.
We’ve found that if we can solve those issues that generate friction for our users, we see our churn rate diminish.
For example, you might notice a pattern from your users asking for a specific feature they expect within your product, and a significant percentage of those users start to churn. If you listen to your customers, develop that feature the way they want it, you’ll see less churn because of it.
7. They use it to identify the root issues in user experience
Simon Elkjær, Chief Marketing Officer @ avXperten
Having a high customer churn rate only means that your customers are no longer happy with your product and service. Though improving your overall customer experience and retention strategies are worthwhile strategies, we’ve found that it’s really important to get to the root of the problem in your product and really focus on that.
Customer feedback is one of the best ways to identify these root problems. Make the most out of all the available channels you have and constantly ask your customers how they perceive their product or service. Interacting with your customers and being attentive to them can help you serve them better and reduce churn.
8. They build it explicitly into their product development ticketing system
Charles Edge, CTO @ Bootstrappers
I’ve been in a number of product roles at organizations, both to instigate the development of products and to act as a sherpa to keep our products safe. Now I advise on lots of products at lots of companies.
There are a lot of statistics we can put on tickets and surveys that come out of customer success teams, with Net Promoter maybe being the most common. But while the stats are important, every growing support organization really needs to make sure to:
- Provide a button on a ticket to send feedback to a product manager. Keep in mind that tickets can be long, windy threads. Especially if they involve bugs or defects, so this should include a required summary before sending.
- Automate a ticket moving into the development system as a defect or attach to an existing defect to increase the score of the defect used in the development organization.
- Include a leader from the CX organization in Customer Advisory Boards (CABs).
- Have a routine meeting session between leaders in CX and leaders in product to specifically look for ways to reduce support costs. This isn’t as much about reducing cost (although everyone likes that) it’s about the customer not having to reach out for support in the first place, and so being happier.
9. They use it to determine feature request priorities
Bruce Hogan, CEO @ SoftwarePundit
We use customer feedback to reduce churn by organizing the tickets we receive into categories by product and feature. Each quarter, when we’re prioritizing our projects, we review this customer feedback and decide which issues we want to address. Typically, we address issues that are the most common and the most severe. The key is to ensure that customer experience teams are working closely with product teams.
For example, in the past, our mobile experience had several dead-ends. Visitors to our website could get stuck on a page if they tried to use specific parts of our navigation on mobile. We consistently heard this feedback over a few quarters, and the associated feedback was pretty negative. As a result, we decided to address this issue and saw our conversion rate on mobile decrease. This also led to a decrease in customer churn.
10. They use it to beta test new features
Natalya Bucuy, Content Marketer @ LiveHelpNow
For example, this year LiveHelpNow is launching a new operator’s panel, with additional features and an updated design. Before we release the updates to all of our clients we are conducting extensive beta testing of the new features with a handful of customers. We ask questions, get our customers to tell us what they like and dislike, what goes smoothly and what needs improvement.
Then we take that feedback to the drawing board and do what our customers want us to do. We use their feedback of their experiences in further development, improvement, and designs of the software. That is a great way of putting customers and their needs first. Not only does that improve our product, it gives our customers a sense of true participation in our brand. And that, in turn, creates and strengthens customer loyalty, ultimately reducing churn.
Common themes: how you can use customer feedback to reduce churn
If you’re not collecting customer feedback, you should be—it’s key to reducing churn.
- Use feedback to understand the root of the problem. Why your customers churn can complex; feedback can help you get a look at the full picture. Gather as much information from as many different teams as you can, and spend some time analyzing the issues. The better you understand your churn problem, the easier it’ll be to fix it.
- Use feedback to build a better product. When done well, feedback helps you build a product your customers actually want. The better your product, the lower the churn. Get bonus points by closing the loop after you make a change that your customers requested.
- Use feedback to build better relationships. Talk to your customers. Asking for feedback helps them feel that they’re being heard and they’re not just a number in a line of other users. Creating a genuine connection builds loyalty and leads to them staying with you. (It’s also a good way to get more feedback in the future).