What’s up??!?!

Just got back again after almost two months. 😭

I’ve been fighting the shiny object syndrome in me in those months.

But I decided that I’d still stick to my offer, lol.

ANYWAY.

Let’s get into the sauce.

What is a churn?

There are four different types of churn.

1. Customer churn

2. Revenue churn

3. Gross MRR churn

4. Net churn

But today, we’ll focus on customer churns.

Customer churn is when users stopped using your product or cancel their subscription. 

Here’s how to calculate your churn rate:

Now, I can’t tell the average SaaS churn rate because it varies from industry to industry.

But ideally, your monthly churn rate should be around 3%.

If you get a churn rate higher than that, oh boy, you need to fix it ASAP.

So here are the 3 strategies to reduce your churn rates:

Strategy #1: Identify High Churn Risk Customers

To do this, you look at certain signs or patterns that suggest they might leave.

These signs could include things like:

• Decreased usage

• Complaints

• Missed payments

• Lack of engagement

Then address it.

Strategy #2: Improve Your Onboarding

I asked a founder on Reddit about what’s his SaaS churn rate like.

He told me this:

20% is still high AF.

Basically, the onboarding process is like the first impression customers get when they start using a product.

If it's easy to understand and shows them how the product helps solve their problems:

They're more likely to keep using it.

If the onboarding process isn't done well, customers might feel confused or frustrated because they don't understand how to use your product or how it can help them:

They might not see the value of the product quickly, so they might lose interest and stop using it.

And I know you don’t want that.

So I suggested him this:

Guide new users through your product with:

• Checklists

• Modals

• Interactive walkthroughs

• Email sequences

Strategy #3: Send Email Campaigns Regularly

I asked a founder again—but this time, it’s different.

I asked if he sends emails to his customers on a regular basis.

He said he does not.

Why?

Because he fears he might annoy his customers, which leads to unsubscribe rates.

But that’s not the case here.

It depends on the type of email you’re sending.

If you’re constantly sending promotion emails without any value, of course, anyone would unsubscribe from them.

On the other hand…

If you’re constantly sending value emails, it’ll be a hard decision for them to click on the “unsubscribe” button.

Look.

Sending emails regularly isn’t as bad as you think if you know how to use it right.

It doesn’t only reduce your churns.

It also builds trust.

Trust > Relationship > Improved conversion rates > Reduced churns > Increased MRR.

Get it now?

And… that’s it for today’s email.

Let me know your thoughts by hitting “reply” or leaving a comment!

— Kate

btw…

If you’re a B2B SaaS founder and want to implement strategy #3, just visit this page. 🫡