- On this blog post, you'll learn how to:
- Keep customers close to you with nurturing flows;
- Dscover trends on customer behavior with churn analysis
- Build an effective customer retention flow in simple five steps.
Marketing professionals have been nurturing leads since the dawn of days. After all, a nurtured lead tends to be more interested in a product, which leads to a higher purchase chance. Assuming they know that lead nurturing isn't throwing random content to random people, hoping customers buy something from them.
But when it comes to customer churn, isn't hard to find customer success professionals ripping the hair off their heads trying to find an effective way to reduce churn.
And it gets worse when companies try to find a solution for it when customer churn is already messing with their recurring revenue.
That's why customer nurturing is as important as lead nurturing: much alike, a customer who knows how to use a product to solve their problems is more likely to keep using it.
Not to mention that its power greatly increases when there's a helpful and caring customer success team behind it.
Why do I need a retention nurturing flow, anyway?
After leads are activated - through a user onboarding process or an onboarding concierge - they're already in the Retention Stage of the customer lifecycle. That means they're probably using the product but still need the right incentive to keep on using it.
Putting ourselves inside a customer's head: most of the times, it's not the product which makes us stay in a company. We know that there's plenty of companies out there offering a similar product that could fit our needs.
Other than a product, customers need a personalized experience: a whole customer journey prepared to help them, make their companies grow and achieve their ultimate result. Otherwise, the feared customer churn enters the scene.
The personalized experience goes way beyond a personalized welcome email or a concierge onboarding: the experience extends to the Retention Stage, going all the way through the customer lifecycle.
How nurturing work towards customer churn
In order to provide a personalized customer journey, companies must be an active part of their success, providing enough resources to help customers achieve their objectives. If a company doesn't provide that, customers lose interest and gradually cut their relations with the company.
It starts by losing touch by email, then lower engagement rates within the app, several days of inactivity, then the subscription cancellation - the churn itself. The good thing is companies can detect that through churn analysis and with a little help from predictive marketing.
Let's analyze the average customer journey map for SaaS companies:
As you can tell, most of these steps include some sort of incentive given by the company. It offers valuable and educational content to help their soon-to-be leads, helping without asking for anything other than an email subscription.
When they're ready, the lead is comfortable enough to try the product, hoping that it'll help them reach their objectives better and faster than before while offering a great customer service. From this moment ahead, customers must be properly nurtured with more valuable and educational content than never: product-focused content and rich content.
This content, along with a one-to-one customer success and, of course, a product that effectively helps them achieve their objectives, is what makes a customer stay in a company. More important than that: they're willing to keep paying for it, thus reducing customer churn.
Churn analysis and predictive marketing for retention
For companies who already have their own retention strategies established, the biggest source of information to increase retention rates is what we call churn analysis.
If you’re ready to get a handle on customer churn in your business, you’re ready to start doing some survival analysis.
By gathering all data acquired from customers who've churned, it's possible to have an overview of their interactions, engagement, and behavioral patterns in order to determine what's common between churned customers.
This analysis is also used by companies when modeling churn through a mathematical model for churn prediction, where the behavior of churned customers are used to create a prediction of the time current customers will stay in the company.
A simple way to reunite churned users and analyze their data is creating a marketing automation flow which adds them to a specific list of contacts - such as Churned Customers.
After that, filter these customers by the time they've churned - last month or semester - and analyze which events have been activated and which events haven't. Everything that could help identify the moment when the customer loses the interest in the product.
Examples of behavioral patterns that can be found through churn analysis:
Even though there are several different cases and customers out there, churn analysis can give insights to identify what kind of actions and attitudes are common between churned customers, and with that, what kind of decisions the company must take to avoid losing these customers. That's what predictive marketing is all about.
With that, while having access to previous customer data and predicting future outcomes on their behavior, companies can develop strategies to improve what has been identified as an issue:
For recent-activated users who are using the product but aren't effectively taking actions in it, an individual approach to identify if there's something wrong with the user onboarding as customers might be having trouble to execute a specific action within the product.
Building a churn-proof retention flow
Let's be honest: a retention-focused nurturing flow isn't the solution to all your problems, but can help you with one of the biggest issue SaaS companies face through its way: customer churn.
Even after identifying the behavioral patterns through churn analysis and setting the next steps based on that, it's highly advisable to start working on a retention flow just after the customer activation.
If the company is there when a customer shows the ultimate form of interest - logged in the app and started using it - they immediately know the company is interested in making them grow.
1. Define the objective of the nurturing flow
First of all, you must have enough data to help you determine the main objective of the customer retention flow, such as increase the numbers of customers using a specific feature, or increase the user activity within the app. It's an important step since the kind of content, frequency and even the channel of communication may change depending on it.
In the following examples, we'll create a retention nurturing flow to avoid customers losing interest (which might turn into customer churn). The flow is focused on showing new features to customers who are using just one feature among those offered by the product.
2. Determine the channel and approach
Will the retention strategy take place within the customer's inbox? Or they'll be able to interact and learn more directly in the product through in-app messages?
While the channel is essential to develop a clear communication of your intentions to the customer, the approach must be carefully set to avoid making them feel you're just another spammer company.
A good strategy is to blend both emails and in-app messages since the latter is an excellent way to reach customers who are already within the product. With it, is a lot easier to guide and encourage them through the app to execute a specific action.
In our example, customers would get emails to suggest a feature they're not using. Together with that, in-app messages can follow the user within the app, to give instructions and complementary content to help them get used to the feature's interface and its functionalities.
3. Create a mind map of the steps
Since the customer churn nurturing flow must start shortly after the customer activation, companies must be careful when choosing how many steps the flow will have to not make it inefficiently short, or boringly long.
After that, the best exercise is to put everything you've made into a mind map, where it's possible to have an overview of the whole process, including the branches it may reach depending on the customer behavior.
Check out a mind map for our example:
There's no magic formula, and different companies require different quantities of steps. It's important that at the end of the nurturing flow, customers feel more confident and believe that the product is exactly what they needed in the first place.
4. Write the content of emails and in-app messages
Since the approach and channel of communication have been defined, the next step is to effectively produce the content that'll be sent. Sometimes, the best strategy is to keep it simple and clean, without too many images or text.
A nurturing flow is built with content, and that's why it's important that you have a content marketing strategy up and running to help these customers achieve greater results with your help. This content is a part of your retention flow as well.
For that, it's recommended the use of content marketing weapons: Middle of the Funnel (MoFU) and Bottom of the Funnel (BoFU) content, with a product-focused approach. Since customers are already using the product, they could use valuable resources to improve the way to use it.
5. Create the marketing automation flow
Now it's the time where the plan and content meet execution. Start by setting the trigger of the retention flow at your marketing automation platform or customer journey automation platform.
Since the Retention Stage of the customer lifecycle starts right after the Activation, don't wait too long to start your retention-focused flow. Say, a few days after the customer finishes the user onboarding.
The great thing about marketing automation is the possibility of setting condition triggers, that'll define the user next steps based on their behavior. With it, it's possible to create different "branches" in the flow, interaction possibilities that'll affect the customer experience and turn it into a personalized journey.
Following our mind map example of a feature suggestion retention flow, the marketing automation would start three days after the customers finished their user onboarding. Their actions after that would be monitored, adding them to different lists according to behavior - using just one feature, or low engagement rates, for instance.
If the customers fit the established criteria of "Contact is in the list", they would receive a feature suggestion email. If customers click on a link within the email, automatically they're redirected to the product with an in-app message to help them discover more about the feature.
Also, there's an "alternative path" to customers who doesn't click the email. If they're really not interested in the suggestion, the flow adds them to another marketing automation flow which will approach them again after a while - but not too soon, to avoid too much pressure.
By following these steps, each company would develop a different retention flow according to the main objective and the chosen approach. And there's no rule for how many flows could be created in a single journey - but the company should always think of not turning the flow into a spam party.
How about you? Do your company already have a retention-focused nurturing flow to avoid customer churn? If not, what different retention strategies could be used together with it to increase customer retention and avoid churn? Share your opinion with us :)