It’s probably fair to say we’re all a bit obsessed with growth. We create our business strategies around driving growth, and look to growth as the key indicator of the health and viability of our companies. But while acquiring new customers is obviously a critical part of having a business, it’s hardly sustainable if they only ever stick around for a few months.
“Are you attracting and engaging the right customers? Are you providing the right support and delivering ongoing value? And where should you start?”
A 1% increase in customer acquisition affects your bottom line by just over 3%, while a 1% decrease in churn can boost it by 7%, which means, in the end, retention can be more than twice as powerful as customer acquisition. Are you attracting and engaging the right customers? Are you providing the right support and delivering ongoing value? And where should you start?
We recently hosted a webinar where Japna Sethi, Group Product Manager at Productboard, and Chip Lay, Director of Product Strategy at Fullstory, joined me to chat about strategies for identifying your customers’ pain points, uncovering valuable insights from customer’s feedback and data, and creating proactive support measures that drive value across the entire customer cycle.
“It can be intimidating starting with a blank chart and not knowing exactly where to go first… You see a data point that looks bad, but why? Why are the people dropping out at step three?” Chip Lay, Director of Product Strategy at FullStory
Retention is about more than onboarding
Spoiler alert: this isn’t about onboarding campaigns. Don’t get us wrong – they’re really important when it comes to customer retention, and we’ve covered them extensively in blog articles, podcast episodes, and even in our recently refreshed guide, The Onboarding Starter Kit.
But they’re not the whole picture. To increase retention and reduce churn consistently, you need a system that continuously drives value for your customers across their entire lifecycle. And that’s why, today, we’re sharing a tried and tested three-step approach to help you achieve it. Read on for the highlights and, if you want to dive into the specifics, watch the full recording here.
1. Understanding where – and why – your customers are getting stuck
Using a mix of qualitative and quantitative methods, such as session replays and A/B testing, provides a better context of what’s happening and can uncover new areas of research.
Not all friction is created equal. Quantify the impact of each point of friction and prioritize the ones that are having the most impact on your business.
“The idea is to use qualitative and quantitative together in a flywheel to help you ask better questions and move faster. You can use product analytics to discover new areas for research. You can use qualitative inputs to spark ideas for experiments to run.” Chip Lay, Director of Product Strategy at FullStory
2. Organizing customer feedback
After identifying the what and the why, the next step is collecting and centralizing all customer feedback – direct and indirect – so you can turn it into actionable insights.
Segmenting feedback by company attributes or characteristics allows you to identify patterns and make prioritization decisions in a dynamic way.
Use those insights to provide clarity and transparency on decisions to stakeholders.
“This gives a lot of context, not only to help you make decisions, but also for your team to understand why you made certain prioritization decisions. It really helps align the entire organization on one strategy.” Japna Sethi, Group Product Manager, Growth, at Productboard
3. Proactively engaging and supporting your customers
While product announcements are important, they should be just one of many tactics.
Use the Swiss Cheese Method to “stack” proactive support measures in different formats and channels, such as Product Tours and Tooltips, to ensure the message gets across and customers get value from your updates.
Proactive support tactics can showcase the value of product changes at the moment the customer needs it the most and drive adoption long after the initial product announcement.
“The more tactics you use, the less likely you’re going to have people slipping through the cracks and the more customers are going to learn about what was released and how they’re able to get value from what you just shipped.” Mark Iafrate, Product Marketing Manager at Intercom
Turn up the volume on your user behavior data.
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