How we decreased churn by 14.7% in April by doing things that don’t scale
First things first: I have the honor of writing this article and sharing my practices and steps for lowering churn. Because of that, you’ll see more of my role than others, but the numbers we posted in April are a reflection of a churn-busting process that has been building momentum for months. You’ll also see more posts soon from other team members on their specific efforts, but I want to highlight a few here.
In April we had total revenue churn of $31,923. That was a 14.7% decrease from March, and our lowest month since September 2016. To put that in context, in September we had $411,704 in MRR and 8,363 customers.
We ended April at $661,889 MRR and 13,089 customers. User churn dropped from 7.4% to 6.2% and revenue churn from 5.9% to 5.2% (historical rates below). Don’t forget you can see all of numbers at convertkit.baremetrics.com!
We did implement two meaningful changes in April that put the icing on the cake, and that’s what you’ll read more about below. But here are four important factors which have been happening for months and made an undeniable impact.
- App performance and stability: There will be an engineering-specific post about this to give more detail, but ConvertKit as an app has been performing exceptionally well. Grant Ammons and the rest of the team have been working to upgrade the database and systems that make the app work smoothly each day.
- Ticket response times: It’s no coincidence that we continue to lower our response time to tickets at the same time churn is dropping. When customer problems are solved quickly and kindly, customers are happier.
- Product Creation Master Class (PCM): We have regular partner promotions, but in April our sales and marketing teams created “PCM” and it has been a resounding success. While those on trial wouldn’t count against churn, paying customers in the class have more incentive to stay and keep learning.
- Better content and partner targeting: since the beginning of the year our sales and marketing teams have focused on creating more targeted content and partnerships for customers. This has led to higher quality signups that become customers more likely to stay on, and lower churn.
What we did (and still do) that doesn’t scale
In this essay by Paul Graham, he talks about the idea of doing things that don’t scale. Early on the amount of hustle it takes to stand out in the field seems impossible. But that shouldn’t stop you from doing it anyway.
We did this early (and still do) with our migrations, but now we’re taking the idea to a new level with custom onboarding for new customers. There are two ways we attacked this in April that marked a distinct shift in our strategy.
Custom onboarding by platform and email
For the life of ConvertKit, we have had a good but very normal set of onboarding emails. There is also a checklist in the app that walks a customers through setup, and we have weekly live training for those who want to hop on and learn with others. Not bad, not remarkable.
What we realized early on with this path is that it gave people a good starting point, but still required them to do a fair amount of digging to find the right article to solve a problem. Besides leading to higher churn, it also increased the number of tickets we answered each day. In short, the emails were still impersonal and led to reactive rather than proactive care from our team. So how could we solve this?
One way we’ve been talking about for months is more contextual emails. If we knew where people were coming from, we could deliver a better email experience with exact information. Using Wordpress? Here’s what you do! Coming from MailChimp? Here’s the article explaining everything!
So unscalable act number one? Go to every new account website and see what he or she was using for a web platform and email service.
ConvertKit has about 60–70 new accounts each day, and for two weeks I went through every new account to see what I could learn about their setup. Then I put all of the information in a spreadsheet, added the platform and email attributes to Intercom, and watched the matching messages fire off.
Some examples were:
- Customers using MailChimp and Wordpress
- Customers using Aweber and Wordpress
- Customers using MailChimp and Squarespace
- Customers using only Wordpress or Squarespace
You get the idea. Basically the email would read the custom attribute and insert the matching article. That part was automated at least.
After 1–2 weeks of doing this, my manager Matt Newbill wrote a script that used BuiltWith to automatically search the new accounts for platform and ESP. This immediately saved me a couple hours a day. There is still some manual searching and confirmations, plus a small error rate, but overall I spend 30 minutes on it now.
This is all nice, but it’s not truly special or worth talking about. What happened next though…
Personalized welcome videos
That’s right. I send a personal welcome video to (almost) every new customer that signs up to ConvertKit. About 50–70 each day.
Here’s an example (used with permission):
This is where the magic started happening. People’s responses were amazing. They were so thankful to have something just for them. In the video, I simply say hi, say his or her name, welcome them to ConvertKit, and give them a quick tip based off their site, platform, or ESP.
It all takes about 30 seconds. But the effect is much bigger than that. Forgive me for being a bit philosophical here, but as we build an automated digital world the one-to-one connections we make become even more valuable.
Here’s one of my favorite emails responses I’ve had since implementing the welcome videos:
As I received more and more of these (several a day now), it has become clearer that the magic is not telling them they are using Wordpress or Squarespace.
The magic is in saying their name and noticing something about their work.
The numbers are still early for this, April’s churn numbers won’t actualize until the end of May. But two numbers we can see are user churn for 0–7 and 8–15 days, which are seeing significant decreases. The 0–7 day user churn just completed the best month ever, and 8–15 day churn is the lowest since October 2016 (with 500 additional accounts).
I want to reiterate this is not just because I say hi and smile on a video. It’s our team creating systems that help our customers succeed and feel welcomed, like they’re not just another number.
How we make the videos
For these videos we use an app called Bonjoro, and it’s ridiculously easy to use and communicate with your customers. Bonjoro syncs with Intercom to share customer contact information and our open rates are around 30–35%, though I’m testing ways to boost that.
What’s funny is several people who watched have said they didn’t realize it was a personal video until they heard their name! Now at the start I say the name as quickly as I can. I plan on writing an additional post just about the process I use with Bonjoro, so keep an eye out and subscribe for updates.
I’m really excited for what the coming months will bear out for these videos and customized onboarding. With the “brute force” approach we are using now to experiment, I believe we are striving to deliver the best of targeted information with videos delivering a personal touch.
Two more things.
- I’ll also be working on an entirely new in-app onboarding experience with Nathan Barry and our lead designer, Dylan Feltus. There are some great plans in place to help new customers understand the app quickly and find success. I can’t wait.
- The second phase for the videos is not just to use them as a welcome tool, but also as a check-in tool for customers who seems to be struggling or simply inactive. How much more effective will a video be for mid-cycle resuscitation? I’ll be sure to tell you when I find out.
If you would like to see a little bit more on the process and the behind-the-scenes of it all, check out this video from my YouTube channel!