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+17 Retention Tactics: Grow your SaaS using the Pirate Framework (AARRR)

Are you grappling with challenges in retaining your SaaS customers? 🤔 Intrigued to know how to reduce churn and achieve high customer loyalty?

Welcome to an in-depth guide that unveils effective retention tactics, crafted around the resilient Pirate Framework (AARRR)! This article unveils 17 powerful tactics aimed at boosting your SaaS business’ customer retention and, in turn, its growth.

Customer retention, the key to a sustainable and profitable business, is no longer a secret with this guide. Uncover a world of strategies 💡 that grants longevity to your customer life cycle, ensures recurring revenue, and amplifies the potential for customer referrals. We’ve packed this guide with strategic insights, data-backed facts, and successful real-world instances just for YOU. 🎯

Lace-up as we dive into these tactics, step-by-step, all in an effort to maintain and enhance the longevity of your customer relationships. 🚀

#1 Apply Sales Discovery questions

Focus on your Sales discovery to find the true pain points of your customers and in order to show them the real value of your product. Knowing the real pain points help you draft better follow-up communication. Great discovery questions help you qualify, keep your pipeline clean and focus on the most promising leads.
Every great sales discovery should give you at least the following answers:
– Does the prospect have a problem/pain? If yes, what is it?
– Are they aware of the problem?
– Do they want to solve the problem?
– What implications does it have for them, if they can’t solve the problem?

👉  Here are 10 great B2B SaaS Sales Discovery Questions.

#2 Be closer to your customers

Have at least 1 call per week with customers and potential customers. With every call, you will learn (about pains, feature requests, marketing messaging, etc.). You can also build a customer advocacy program to turn your most influential customers into brand ambassadors.

👉  Here is a great guide about customer advocacy programs.

If you just starting out with your business (or expanding to new markets) build a launching partner program. It’s basically a group of early customers and they provide you with insights, and regular reviews of the roadmap & help you to grow your brand in the industry, make intros and referrals, etc. In exchange, you can offer them special conditions

#3 Build an objection battle cards

Create a list of the top 5 objections and learn how to handle them. The most common objections include:

  1. Your product is too expensive
  2. We can’t decide right now
  3. We miss XYZ feature

You can also include competitors in your battle cards.Revise your communication and see if you can already anticipate them in your communication (e.g. Welcome Email sequence, FAQ…).

#4 Build lock-in features for stickiness

Can you build features that increase the lock-in of your product and make it hard(er) for your customers to churn/switch to the competition?
• APIs: By offering robust APIs, you allow users to integrate your product with other tools and systems they use.
• Multiple User Accounts: If a company has many employees using your product, the collective knowledge and familiarity with your system create a barrier to switching. Training a whole team on a new system is time-consuming and costly.
• Historical Data: When users have accumulated significant historical data in your system, it becomes a valuable resource.
• Customizations & Integrations: If users have tailored your product to their specific needs or integrated it with other tools, these customizations create additional barriers to switching.
• Network Effects: As more people within an organization or industry use your product, its value increases, making it harder for individuals or teams to switch without losing out on the network’s benefits

#5 Conduct Exit Interviews

If a customer is leaving, so be it. The goal of this interview is not to get him back, but rather to have a word with them before they walk away. Before he exits, seize the opportunity for a final conversation.
→ A video call is fantastic
→ A phone call is great
→ A chat/email is good Even if you let them rant, you will learn from their reasons for leaving and apply this knowledge to improve your product and offer.

Credits: Vishal Rewari from Optiblack

#6 Create a customer Re-Engagement Campaign

Re-engage customers who have become inactive or haven’t made a purchase or used your SaaS product. Email Strategy: Send targeted emails or a series of emails to these customers. The content should remind them of the value they once found in your product and what they might be missing out on.
• Offers & Incentives: Provide special offers, discounts, or exclusive features to entice them back. This could be a limited-time discount, access to a new feature, or a personalized training session.
• Benefits: ◦ Increased LTV: By re-engaging inactive customers, you can boost their lifetime value.
• Feedback Collection: This campaign can also serve as a feedback mechanism. Understand why they became inactive and use this insight to improve.
• Strengthened Customer Relationship: Personalized re-engagement efforts can reinforce the bond between your brand and the customer.

#7 Downsell on cancellation

When a user intends to cancel their subscription, consider offering a downsell option. The downsell can be a more affordable version of your product or service, retaining the customer at a lower price point. For instance, if a user is part of a $97/month membership program and wishes to cancel, offer a ‘lite’ version for $47/month.

👉 This approach can retain price-conscious users and prevent complete churn, ensuring some level of continued revenue.

#8 Email Sequence – Churn

Survey your churn customers. Once they cancel, ask them why. Send automated emails with a quick survey. Use dropdown fields with churn reasons + open text field for further info about why they cancel (once a month, analyze the churn reasons). Based on the churn reason, personalize your follow-up:
• too expensive —> one-off discount
• too complex —> Customer Success call / Free Training
• missing feature —> share product roadmap Even offer to jump on a call with them. For important customers, call them. During a call, you should ask:
– Why did you initially start using [Product]?
– Why have you stopped using [Product]?
– Is there something that could have been done differently?
– How are you going to replace [Product]?

#9 Limit and standardize your discount policy

When offering a discount, always ask for something in return. Otherwise, you devalue your product and lose trust. Offer discounts only in exchange for:
• Long-term commitment
• Upfront annual payment
• Taking part in a case study
• Intros/referrals to other companies
• Signing/onboarding in the next x days

👉  Learn more about it here.

#10 Revamp the top 3 jobs to be done

Customers don’t buy your product because of all your features. Actually, they don’t care. Customers “hire” your product. They care about what’s in for them. Your product helps them to do their job better:
-e.g. create beautiful websites/convert lots of traffic in signups/close more deals/get customers’ insights (—> Jobs to be done) They want to feel [emotional results using your product]
– e.g. healthier/more productive/smarter

👉 Revamp the 3 main jobs to be done for your ideal customer (do research, customer interviews, read reviews, etc.). Adapt them in your customer-facing communication.

#11 Send a Surprise Bonus Email (freebie)

Send out emails to your B2B SaaS users with surprise gifts or free content.

  • Segment your user base to target active users or those who might benefit from a re-engagement nudge.
  • Choose the bonus: it could be an industry report, a discount on complementary services, or an exclusive webinar invite.
  • Track engagement metrics post-campaign to measure its success and gather insights for future initiatives.

#12 Set a North Star Metric

Try to focus on what really matters. A great tool is to make use of a North star metric and to set goals (e.g. with the OKR framework).

👉 Check Alex’s examples of north star metrics.
👉 Check Mariano’s examples of north star metrics.

#13 Shadow/listen to a prospective sales call

Gain direct insights into customer needs, objections, and feedback by actively listening to prospective sales calls.
✅ Firsthand exposure to the questions, concerns, and feedback of potential customers provides invaluable market understanding.
✅ Common objections or concerns raised during calls can be used to adjust sales strategies for future pitches.
✅ Understanding customer pain points and needs can lead to more personalized follow-ups, strengthening relationships and increasing conversion chances.

Coordinate with the sales team for suitable calls, ensure customer consent for an additional listener, actively listen without interrupting, and discuss insights post-call with the sales representative.
→ What problem can you solve for your target customers? 
→ What are your customers’ day-to-day life’s primary and adjacent pain points? 
→ Which concerns of potential buyers’ can you eliminate through your content?

#14 Sit on customer support for a day

You will get valuable insights from first source, go deep on your talk with your customers:

→ What are the most common use cases customers need help with?
→ What language do they use to express their problem?
→ Which FAQs can you answer via your content?

#15 Survey customers

Frequently surveying your customers is key. You will always learn more.
🔗 Use this survey template from PMF Survey to get started.

Here are some possible questions (depending on what you’re trying to learn about your customers).
• How did you discover [X product/company]?
• How would you feel if you could no longer use X?
• What would you use as an alternative if X weren’t available?
• What’s the primary benefit you’ve experienced from X?
• Have you recommended X to anyone? • What type of person do you think would benefit from X?
• How could we improve X to better meet customer needs?

Important customer Segments to get better insights:
– Most active
– loyal users
– Infrequent
– high NPS score
– high/low MRR
– inactive users (signed up but never used it)
– new customers
– churned customers

#16 Try offering Annual Payments

Encourage long-term commitment by offering discounted annual payment plans. For instance, if a monthly subscription is $20, offer an annual plan at a rate equivalent to $15 per month, totaling $180 for the year.
💰 Annual plans can enhance customer retention and ensure a steady cash flow.

#17 Try sending a Testimonial Email

Send emails showcasing genuine testimonials from satisfied clients.

👉 Try to match user persona and use case
👉 Highlight specific features or significant benefits of your product within the testimonial.

Conclusion

Wrapping up our exploration of 17 retention tactics, it’s reflection time.

Customer retention presents a valuable opportunity for SaaS businesses to build a solid base of loyal users. A significant reduction in churn, increased customer loyalty, and a healthier bottom line are just a few proven outcomes of effective retention strategies highlighted in this article.

So, why wait? Start implementing these proven tactics and experience the transformation in your SaaS business retention rates today!

Article by

Mariano Martene

Mariano Martene is a Full Stack Marketer helping SaaS around the world grow their business and reach their next milestone. He is currently the Co-founder of SaaS-HQ and has been a b2b marketer for over 10 years, and has launched several successful side projects.