16 Ways To Trigger Red Flags & Earn The Chance To Reduce Churn

3 minute read

Customer Acquisition Costs (CAC) and Life Time Value (LTV) are two key SaaS metrics you’ll be focused on.

Minimizing Churn, whether from trial to paid sign-up, or from sign-up to fully engaged paid-up user, is therefore critical.
 
One of the Growth Initiatives at your disposal is the Red Flag. A Red Flag indicates a high probability of Churn. A Red Flag can be raised when through data analysis the likelihood of churn becomes statistically likely, or an explicit customer response has triggered the same Red Flag.
 
So in essence, Red Flags are all about trigger moments, with the best and most successful SaaS companies spending a lot of time defining, analyzing and optimizing both the triggers and resolutions that take a Red Flagged Account to Amber and Green.
 
Here are 16 triggers you can watch out for that will help you reduce churn.
 

Trial to Sign-up

The first part of a Customer Journey I want to look at is that critical stage when they are evaluating your product (possibly against others) for a ‘best fit’.
 

Job To Be Done

When a potential customer signs up to your product they had a list of ‘jobs to be done‘, and they hope that your product was part of all of the solution.
 
A common churn moment comes when they don’t see how the product will achieve these jobs, or they think it won’t achieve them in a way they want them done.
 
One solution is to ask them during the sign-up or upon login.
 
What jobs were you hoping [your product] would do for you today?
 
If you don’t know, it’s hard to see whether it is a case of they couldn’t find how to do it, your product didn’t do it, or do it well enough.
 
If you know, you have all kinds of opportunities. For example:
 
  • You can customize their on-boarding
  • You can then ask them to grade you on how well your product did those jobs
Red Flags:
 
  • Jobs they wanted to do were not done
  • You were graded poorly on jobs you’re great at

What Green Flag Customers do?

Another solution that doesn’t involve asking them is to know what the journeys of a Happy Green Flag customers look like. What did they do in the first few hours and days? How does this differ from the group that churn?
 
Red Flags:
 
  • Trial user did not do X, Y, Z
When you know this you have an opportunity to optimize you on-boarding again.
 

SaaS Speed Daters

There are a lot of SaaS speed daters out there. They sign-up, have a click around, and they’re gone. If only you could have spoken with them longer. You’d have shown them what a great fit you were, and that you’ve even got unique qualities that are simply not available elsewhere.
 
If your product suffers with Speed Daters, what you need is a plan to show and tell them how great you are and set-up the an amazing second date.
 
Ideas to help include:
 
  • Better on-boarding walk-throughs
  • Mature demo accounts – if it takes time for your software to have complete or mature data, you can populate a demo account whilst their own is being set-up, show them what success looks like
  • Get them to invest and make the investment worth it – what inputs e.g. integrations, can you receive and what can you do to turn those inputs into something really cool, a must see
Red Flags:
 
  • They didn’t see mature demo account
  • They didn’t invest in the set-up

Sign-up On-the-Rocks

As the musical philosopher Neil Diamond said:
 
Love on the rocks
Ain’t no surprise 
Just pour me a drink and I’ll tell you some lies
 
Let’s jump forward 9 months and pretend that your relationship with your customer has gone from a Happy Green Flag, to Amber, and then a Red Flag. What were the signs that the relationship was on-the-rocks?
 
There’s actually a lot that can go on with a customer to make them reduce or even stop using your product. These include:
 
  • Their job has changed or evolved
  • Their priorities have changed and they’ve less time than they need
  • They don’t love your product anymore
  • They’ve found a better solution
Red Flags:
 
  • Logins (single and multi-user)
  • Usage session time
  • Specific feature usage e.g. dashboards
  • Specific action usage e.g. OKR confidence changes
  • NPS survey drop
  • Product suggestions
  • Session success survey e.g. How was your session today?
  • New feature engagement
  • Not taking phone calls
  • Webinar attendance
  • Not opening email
 
If all of the above were being monitored, would you be able to spot those most likely to churn?
 
And the bigger question. What would you do about it?
 
Which Red Flags do you use?
 
That’s for another post.

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