Embedded BI: An Antidote to Churn
"Well, in our country," said Alice, still panting a little, "you'd generally get to somewhere else—if you run very fast for a long time, as we've been doing."
"A slow sort of country!" said the Queen. "Now, here, you see, it takes all the running you can do, to keep in the same place. If you want to get somewhere else, you must run at least twice as fast as that!"
— Lewis Carroll, Alice Through the Looking Glass
No one in the SaaS world is a stranger to churn. Clients cancel their contracts and downgrade to less expensive plans, driving up customer and revenue churn rates respectively. These losses eat away at the time and money spent acquiring that revenue in the first place, forcing SaaS providers to recover from the setback before reaching for their growth goals. So many of us find ourselves in the Red Queen’s race, running as fast as we can just to stay where we are.
But we don’t have to stay in the world behind the looking glass. SaaS providers can reduce churn rates by keeping customers happy and making their products indispensable to daily operations. How, though, does one go about doing that?
Introducing embedded analytics to your application can certainly be part of the solution. You might think business intelligence software does little more than improve the product in question, but it can actually help address most of these ten common churn causes. Here’s how.
Chargify claims that good onboarding is about reducing the time it takes for a customer to reach their “first success” with the product. They suggest that you “identify the first success your customers are aiming for” and then craft an easy way for the customer to achieve it.
This is a great suggestion, and with embedded BI integrated into your application, reaching this first-success milestone could be as simple as having the customer execute a premade report or dashboard. Giving them instant insight into their data is a powerful means of driving home the value of your product.
Data-Driven Customer Success
It’s important to keep tabs on customer satisfaction, but bothering clients with satisfaction surveys can actually reduce their satisfaction!
How else are you supposed to touch base and make sure everything’s going smoothly? Well, one of the great things about embedded BI is that you can use it internally to analyze customer usage data and identify any trends that might be cause for concern. This way, your customer success team can reach out to address specific issues instead of placing the burden of diagnosis on the client.
More Support Bandwidth
Embedded analytics is no substitute for a help desk or ticketing solution, but it certainly can free up your IT department to do what they were hired to do instead of creating reports all day long. So many companies find their IT teams stuck responding to customer requests for reports. The high demand can lead to a bottleneck that gives the impression of poor customer support, even though IT is working at breakneck speed to meet the need. Sound familiar? It might be time for you to give your customers direct control over their data.
Reduce Competitor-Driven Churn
At the top, we mentioned that adding analytics to your product is a great way to make it more attractive to prospective customers, and there’s no doubt about that. But BI is also sticky. Once customers start building a report library and getting used to your analytics features, it will require considerable effort to switch to a new provider. People tend to resist change unless they are strongly incentivized to do so. Picking an agile BI solution capable of responding to evolving customer needs is a great way to reduce churn and beat out the competition.
Strengthen Your Proof of Concept
Chargify points out that sometimes customers churn away because they misunderstood your application’s features during the evaluation phase and really weren’t a good fit for the product in the first place.
Tightening up your sales-side communication is crucial here, and one way of doing that is to show prospective customers your BI report library during the evaluation phase. These reports will give prospects a concrete idea of how customers use your application: what data they enter, how the application supports their operations, and what insights they might be able to glean from that information. If they’re excited about the stock reports, there’s a strong chance they’re a good fit. If, on the other hand, they don’t quite see the utility of these reports or don’t have a need for them, consider it a red flag.
Add Strata To Your Pricing
Embedded BI is highly modular, meaning you can control which customers get access to which features using permissioning. Incorporating BI into your application, therefore, gives you another dimension by which to stratify your pricing model. Maybe you already have Basic, Professional, and Enterprise tiers, but now each of those has Standard and Advanced sub-tiers corresponding to different analytics offerings. The more flexibility you’re able to build into your subscription plans, the easier it will be for you to prevent customers from churning away due to cash flow issues.
Rely Less on Power Users
Look for a BI solution that offers ad hoc reporting made simple. The more casual users are empowered to answer their own data-related questions, the less your clients will depend on a handful of advanced users to make the application accessible to the rest of the company. If one or more power users leave their companies or transfer to other roles, you don’t want adoption numbers to suffer as a result. Self-service BI helps democratize software that might otherwise be used primarily by more technical workers.
Boost Your Appeal to Mid-Market Customers
If you’re a SaaS startup looking to become more attractive to medium and enterprise-scale companies, value-adds like embedded analytics are a great way to initiate that growth stage. If you don’t continue to support legacy versions for your early adopters, you may see an increase in customer churn; but this should balance with the overall decrease in revenue churn. Losing two $100 subscriptions for every $250 subscription you sign is still a net win.
Embedded BI isn’t the solution to all churn-related problems. It won’t, for example, improve chemistry between your personnel and your customer personnel or help you mitigate damage during system outages. But it can alleviate a number of other root causes, so if any of the above are on your company’s horizon, it may be worth looking into an analytics solution. Do whatever it takes to leave the Red Queen in the dust.