SaaS Lifecycle Management: A Comprehensive Guide to SaaS Customer Management
Different SaaS goods are likely something you use every day, whether you pay for them or not. The reason for this is that the software as a service (SaaS) business is quickly growing and spreading. On the other hand, if you’re a business boss or customer success manager (CSM) at a SaaS company, you need to know the different ways to get new SaaS customers. If you don’t, your company will be one of the many that loses customers too quickly.
SaaS Customer Lifecycle Overview
The SaaS customer journey can be broken down into three stages: getting new customers, keeping old customers, and keeping engaged customers. When people buy a SaaS product, it’s not enough for them to just buy it once. They have to use it over and over again to see how valuable it is, and then they’ll keep buying from you every month or every year.
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Many times, you have to show that your product is valuable. This is one of the things that makes SaaS such a profitable business: 51% of businesses use SaaS apps for most of their tasks, and 38% of businesses only use SaaS products. This means there are a lot of challenges, but also a lot of opportunities. Here, we’ll quickly go over the steps of the SaaS customer lifecycle and how to make the most of each one.
This is what people do when they want to learn more about a company, interact with it, and buy something from it. Its steps are recognition, conversion, purchase, activation, renewal, and recommendation. These all fit into the processes of attracting, engaging, and delighting customers.
Stages of the SaaS Customer Journey
1. Awareness
In this stage, your customers realize they have a problem that needs to be solved. They learn about your brand or answer by researching online and finding your free resources, such as blog posts, YouTube videos, or social media.
2. Conversion
They know about your solution and have signed up for free resources to learn more, like an ebook, a webinar, or a free trial or version of your product. This is the conversion step. This is the point where lead handling with offers that are specific to their needs will help move them closer to buying from you.
3. Purchase
At this point, your sales team has done its job and found a new customer who will pay. Right now, it’s important to keep showing value by giving customers special onboarding, proactive customer success management, and the chance to give (and receive) feedback.
4. Activation
Not only do you want a person to buy your product, you also want them to use it every week or every day. Most SaaS products are paid for on a monthly basis, so it’s easy for customers to stop and go with a different product if they don’t like yours or find it useful. Make sure to reach out, teach, and give customers tools to avoid common problems that cause customers to leave.
5. Renewal
After a few months or even a year of using your product well, the customer has to pay again to keep using it. Before these dates, it’s important to stay in touch with your customer to find out if they have any concerns that might make them not renew. Because you want to thank them for being a customer, make sure they know what the benefits of joining your loyalty program are.
6. Advocacy
By now, your customers have not only renewed their subscription but also joined your customer loyalty program. They are also so happy with your product that they tell their friends and coworkers about it. Customers who are happy with your SaaS product will spread the word about it through word of mouth, writing reviews, acting as recommendations and case studies, and joining as affiliates.
How to See the Customer Lifecycle with the Flywheel
We’ve switched from using the funnel to the flywheel at HubSpot to better understand and show these stages of the customer journey. The stages of the customer lifecycle are shown as a flywheel. The more you spend in each stage, the faster the flywheel spins. This method invests in site users, prospects, and customers to keep the flywheel going and bring in more customers while keeping the ones you already have happy and loyal.
Customer Lifecycle Stages and the Inbound Methodology Flywheel
1. Attract
You may already know about the inbound method, which involves making educational content for buyer personas and sharing it on blogs and social media to get people to know your brand. This gets them to visit your site and learn more about your product or service. People who read your content will be more interested in lead-generation content or tools that you hide behind a form they need to fill out in order to see more helpful content.
2. Engage
After getting in touch with leads, you can keep them interested with free tools, workshops, content offers, and other trainings until they are ready to talk to your sales team. They could be using a free tool, have asked for a test, or have done something else that makes you think they might be ready to buy. When the sales team contacts them, this makes them more likely to buy when they become a customer.
3. Delight
The flywheel really starts to turn during the delight moment. This stage is all about continuing to please your current customers. This will make them happier, more loyal, and help spread the word, which will fuel the “Attract” phase and bring in new customers.
If you put reactive customer support and proactive customer success at the top of your list of priorities, you’ll keep customers coming back to subscribe or buy from you, they’ll give you referrals and good reviews, and they’ll tell their friends and coworkers to buy from you too, which is one of the most important things potential buyers think about when choosing a product.
Managing SaaS Applications and Usage Tracking
What it Means
If business SaaS apps are managed well within a life-cycle plan, the Manage phase is where long-term maintenance takes place. This is where applications will “live” the longest, but it may also be the most important step.
Mismanagement is most likely to happen at this time, though, because applications need to be actively maintained, measured, and managed on a regular basis.
What to Do
At least once every 30 days, owners and users of SaaS applications should look at the following and move as needed:
- The company now has new SaaS apps.
- All upcoming dates for SaaS renewal
- All of your SaaS costs or spending
- Any apps or functions that are already being used
- Not used or not fully utilized applications
Benefits
- Sets up a regular check-in schedule for all SaaS services, which stops costly surprises and “shadow IT.”
- Regular reporting makes sure that KPIs and measures are always up to date.
- Allows teams, partners, and application users to work together when used with a system of record that makes information visible to all of them.
- Makes governance work by constantly finding new applications, measuring current ones, and sending out notifications at the right time.
Proactive SaaS Renewal Planning
What it Means
When looked at in terms of a lifecycle, an application’s renewal date is like a turn in the road. If the application is repeated, it will stay in the Manage & Measure stage, though some changes may be made.
If the organization decides not to renew or keep using the application, a retirement or off-boarding process is set up to make sure the application leaves the organization with as little risk as possible.
Considerations
Think about these choices for each contract term in each application:
- You might want to use a different tool instead.
- Keep and grow (get more teams to use it, get more people to use it, or something else).
- Keep as-is means to keep using it at the same level.
Benefits
- Creates a renewal plan that helps people make smart decisions about upcoming renewals well before the deadlines for giving notice.
- Makes sure that all the things that affect decision-making are taken into account when evaluating the value of a SaaS application.
- Keeps and increases the value of SaaS tools by letting you negotiate renewals with SaaS providers in a way that is informed by data.
Thus now you are aware of SaaS Lifecycle management.
