Teach a man to fish and his credit card will follow
According to SaaS experts Lincoln Murphy (prolific customer success blogger) and Brian Balfour (former VP Growth for HubSpot), user retention is the key to SaaS success… nothing is more important than retention.
Lincoln writes a ton about customer success and its impact on retention. When you make your customer successful with your product, they’ll stick with you. Indeed, what product user doesn’t want to keep using the product that’s making her successful?
Brian emphasizes the importance of retention on your SaaS business metrics. If your churn (i.e., the nasty outcome of not retaining users) isn’t under control, eventually your growth rate will turn flat like the Canadian Prairies.
To Brian’s point, the blue line below illustrates what happens to growth when churn is a factor:
Lincoln and Brian know what they’re talking about.
But I believe there’s more to retaining customers than focusing on customer success and retention as a key SaaS metric…
Helping users succeed with your product will greatly increase the likelihood of retaining them over time. But teaching someone to be a skilled driver requires more than a few lessons in a single car.
Crucially, teaching someone to be skilled in any domain requires that you go deeper than a single product will allow.
To maximize your product’s retention, teach your users (and prospective users) a new skill, approach or way of thinking.
The best way I’ve found to teach your audience is through content marketing.
Use a marketing tactic to improve retention and customer success?
But what about the product itself?
Your product is critical to retention, but it can only teach users so well. Digital products typically don’t make amazing educators (as much as I love my Duolingo for learning Italian) — and especially not when it comes to teaching new concepts and new ways to think.
Who make the best teachers? People do.
Looking inward, who’ve been the biggest influencers in your life? Ponder that for a sec…
I’m guessing there’s at least 1 teacher or professor in your list.
Teachers influence us in a massive way throughout our lives… they show us how to understand concepts, ask the right questions, be critical, communicate… and even behave.
You and your organization can have exactly that kind of influence on your customers, simply by teaching them something new.
And teaching customers something new will create a strong connection and a lasting impression — which are just the things you need to build brand loyalty.
From accidentally quitting Intuit to educating entrepreneurs about copywriting
Copy Hackers is a copywriting and marketing brand built entirely on teaching people how to write emails, landing pages and websites.
The million-dollar business was conceived by Joanna Wiebe based on the popularity of this post on Hacker News, nearly 6 years ago.
If you don’t have time to read all 122 comments, here’s the core of the thread from Shereef Bishay, the startup entrepreneur who started it:
A few days ago, I responded to a comment by bloggergirl offering to read anyone’s web copy and help. I shot off an email hoping for a paragraph or two of feedback on my startup’s copy.
Instead I received a professional, detailed deck of tons of invaluable well thought out feedback. It must have taken her an entire afternoon.
To top it off, this isn’t someone with a lot of free time on her hands, she’s only days away from launching her own startup
This community blows my mind!
Shereef was responding to Joanna’s no-strings-attached offer to help, and she blew away his expectations. Many more requests like Shereef’s followed on Hacker News, which eventually prompted Joanna to write 4 ebooks (that, and the fact that she accidentally quit her job at Intuit) about copywriting for entrepreneurs and marketers.
Joanna and I were out for dinner the night she announced the new ebooks on Hacker News, and throughout our dinner, my phone buzzed… and buzzed… and buzzed — giving me a notification every time Stripe processed a new payment.
Ebook sales took off and evolved into speaking engagements for Joanna.
The speaking gigs evolved into video course sales.
And the video course sales now allow us to bootstrap the 6-person SaaS company that’s developing Airstory.
It all started with Joanna teaching people something new.
Will we ever move away from teaching as part of Airstory’s marketing strategy? Not a chance. Joanna hosts a weekly teaching session called Tuesday Tutorials, where she and her guests provide actionable tips on writing effective copy — using Airstory as the writing platform for each lesson.
Teaching people how to write copy (or write better copy) has paid off immensely for Copy Hackers and Airstory.
Could you sell spreadsheets for $5 million per year without educating your target market on their finances?
Back in 2003, Jesse Mecham was preparing for his wedding and the eventual combining of his and his then fiancé’s finances.
He created an Excel spreadsheet to help manage their tight budget — an absolute necessity — because as students, he was earning $10.50/hour and she was earning $9/hour.
Then Jesse started thinking about bolstering their income by selling the spreadsheet that he’d created to manage their own finances. From Jesse:
Wow, if people are making money selling spreadsheets, surely I could sell copies of my primo budget spreadsheet.
You Need A Budget (YNAB for short) was born.
The genesis story of YNAB is cool, but what Jesse’s done since is even cooler.
Jesse created a 4-step system for managing your family finances, and over the past 10 years, he’s been teaching the system to prospective customers, educating them on how to achieve their financial goals.
Students of his system don’t have to use YNAB software, but everything in YNAB is built around this system.
Check out the free educational resources YNAB offers on its website:
Two years ago, Jesse was packing 6,000 people per month into his webinars.
He knows how busy people are and how little time they have to learn something new, so his podcasts are 5 minutes long.
According to Jesse’s recent interviews, education has been a driving force behind YNAB’s growth to 30+ employees and $5+ million in annual recurring revenue.
Could you sell landing page software for $16 million per year without educating marketers on why their landing pages suck?
Unbounce, the Vancouver-based landing page SaaS company has been educating users since it first started.
Their blog dates back to 2009 and now includes nearly 1,000 posts about creating effective landing pages and marketing campaigns. One thousand.
In fact, their very first blog post went live before the product even launched.
At that time, Oli Gardner, Unbounce co-founder, spent much of his time writing funny, colorfully worded landing page critiques to help educate marketers.
He now spends the majority of his time on the road… speaking at conferences around the world about conversion rate optimization.
Unbounce believed so strongly in educating its prospective customers that the company launched its own conference in 2014, Call To Action Conference, which this year is expected to host more than 1,200 marketers.
Turns out that the Unbounce brand is as much about authority and domain expertise as it is about landing page software and templates.
In terms of pure numbers, Unbounce was initially funded by friends and family with $15K CAD. Now they’re at 14,000+ customers and $16 million in annual recurring revenue.
Unbounce has fully embraced the belief that your product should reinforce what you’re teaching. Your product vision should align closely with what you’re teaching. Your product should help cement new behaviors.
The need for synchronicity between your education materials and your product cannot be overstated.
When you consistently and persistently do something new, you become someone different.
Similarly, when your own users consistently and persistently do something new, they become something different.
It’s a transformation that your users will feel — and that your SaaS business will thrive on.
Could you compete with Starbucks — and invent a new vocabulary for coffee connoisseurs — without educating the masses?
The same principles apply to physical product (and service) companies.
Who was ordering tall, half-skinny, half-sweet lattes with an extra shot at coffee shops before Howard Schultz launched Starbucks? Nobody.
Starbucks taught its customers all about consuming coffee, and those customers were transformed into sophisticated connoisseurs of complex coffees.
Know what else happened? Starbucks transformed people into customers who will wait patiently in line to pay a premium for high-tech, brewed, customized cups of exotic coffees.
One of Starbucks’ competitors is doubling-down on a similar strategy.
In many ways, Blue Bottle Coffee is the antithesis of Starbucks. Each of its cups of coffee — which cost between $5 and $7 — is brewed manually, requiring at least three and a half minutes. Grandes, ventis, and other customizations aren’t offered. Its cafés don’t have wi-fi.
But when it comes to educating consumers, Blue Bottle is taking a page straight from the Starbucks playbook.
Starbucks may have 20,000 stores to Blue Bottle’s 14, but through its content marketing, Blue Bottle Coffee is teaching everyday coffee drinkers to appreciate rare, distinctive beans and how to brew them like a pro:
Teaching your users something new accomplishes more than just improving your retention metrics.
If you use content to teach people (e.g., blog, YouTube videos, email list), the content will eventually be indexed by the Googles.
People seeking to learn more about what they do will find links to your content on Google, click them, read your posts or watch your videos… and at some point, they’ll be open to learning more about the company who’s delivering the amazing content — and open to trying the products they offer.
Educating users lifts retention and acquisition.
