Combating Churn: The Joint Force of Younium and Churned

Wolter Rebergen, commercial director of Younium, recently mentioned in a webinar that was hosted together with Churned that it is 10 times more important to retain and engage your existing subscriber base than it was a few years ago.

In this webinar Maarten Doornenbal, Co-Founder of Churned, emphasized the point that B2B SaaS companies should aim to get the highest possible renewal rates and prevent customer churn to survive in the current software market.

Furthermore, Gartner recently released a report stating that predicting CLV (Customer Lifetime Value) enables better allocation of resources to customers that will provide stronger returns.

All of these coherently aligns with the fact that the cost of acquiring a customer have gone up, and are still rising. According to Profitwell the CAC has risen with 60-75% between 2014 – 2019 for both B2C as B2B businesses.

Both Maarten and Wolter shared excitement about how we are entering a new era of utilizing technologies to reduce churn and securing revenue. It opens up new doors for using subscription and customer success data.

Keep reading to figure out what these 2 industry experts have to say about mastering churn

The Misunderstood Metric of Monthly Churn

As observed by Maarten, churn is rapidly gaining relevance as a key performance indicator in business boardrooms. However, there are serious concerns about whether it's being properly analyzed.

The general consensus among SaaS market analysts is that a 5% monthly churn is tolerable. Wolter, however, disputes this view, claiming it's a seriously misguided standard. Over a year, a 5% monthly churn accumulates, resulting in a staggering 46% yearly churn rate.

This essentially means that almost half of your client base is lost annually, greatly affecting both your company's reputation and revenues. Moreover, the current economic landscape exacerbates the issue, as the cost of acquiring new customers can reach up to EUR 13,530.

For these reasons, Wolter advises SaaS businesses to strive to lower their churn rates as much as possible. He states, "Understanding why your customers are departing or lessening their business with you is the initial step in reducing churn."

Decoding the Causes of Churn

Every business faces unique challenges with churn and the corresponding loss in revenue.

Wolter views churn as an unavoidable event in any SaaS enterprise. The real difficulty arises, however, when your customers start dwindling, and you're clueless about why it's happening or how to rectify it.

If you're experiencing a decline in customers from your platform, here are some possible reasons:

• Sluggish implementation and delayed return on investment (ROI): If you don't promptly show your customers the ROI of your SaaS platform, they're likely to switch to competitors.
• Subpar onboarding and user experience: If your onboarding process isn't effective or the user experience is unsatisfactory, users may struggle to make the most of your platform, and declining usage metrics will indicate a lost customer.
• Absence of standardized processes and automation: Businesses are keen to reduce workforce costs through technologies that streamline workflows and automate mundane tasks. If your platform can't provide these features, you're likely to lose customers to a brand that can.
• Inflexible or intricate pricing structures: In situations like competitive price cuts or when your customers are looking to reduce costs, an inflexible pricing policy won't help. Also, if your pricing structure is too complex, customers may find it hard to perceive the value they're paying for.

To combat churn, Maarten stresses addressing the root causes, such as:

• If complex pricing is causing customer loss, consider offering flexible subscription billing options.
• If low product usage is an issue (a significant indicator of churn), invest in proactive customer success management for timely issue detection.
• If you're failing to remind customers about renewals, implement automated reminders.

Wolter highlighted the growing significance of tech-assisted churn management. Let's delve into how Younium and Churned aid in retaining customers, in the following sections.

The Role of Churned in ensuring more revenue

Churned's comprehensive platform and AI capabilities enable businesses to predict and prevent churn, optimize customer success strategies, and drive customer retention. By utilizing the power of data and AI, Churned empowers businesses to elevate their customer success journey and define the future of customer retention.

• Predict and prevent customer churn: Churned leverages AI and machine learning to accurately predict and proactively prevent customer churn. By analyzing customer behavior, interpreting trends, and utilizing real-time data, Churned provides insights that enable businesses to take targeted actions to retain customers.
• Centralized customer data: Churned offers a centralized platform where businesses can collect, structure, and analyze real-time customer data from various sources. This comprehensive 360-degree view of customer profiles helps identify at-risk customers, understand their needs, and build personalized retention strategies.
• AI-generated health scores: Churned's AI engine generates health scores for each customer based on factors such as usage patterns, feedback, and interactions. These health scores enable businesses to prioritize resources and focus on high-risk customers, allowing for proactive engagement and tailored customer success strategies.
• Actionable recommendations: Churned goes beyond churn prediction by providing AI-generated recommended actions. These recommendations guide customer success strategies, ensuring that efforts are backed by data-driven insights, and empowering businesses to take proactive steps to increase customer satisfaction and loyalty.
• Hybrid-Touch approach: Churned recognizes the importance of combining technology-driven insights with human intuition. The Individual Customer View feature allows businesses to delve deeper into individal customer data, track risk score trends, and apply both AI-generated insights and human judgment to create effective and personalized customer success strategies.

A competent customer success platform gathers subscription and customer data from different sources and converts them into a score to assist in determining the best actions for at-risk customers.

Churned takes it a step further by integrating AI capabilities.

Our AI model adapts from every action you take and assesses the impact of each action on the client's health.

Maarten explains, "If a risk pattern emerges, AI will recommend a corrective action. After the action is executed, a new data point is generated, which feeds back into the models. The models then assess the action's effect on the risk."

For instance, if low SaaS product usage is identified as a churn driver, AI might recommend sending an instructional onboarding video to users to rectify the issue. The AI then analyzes the product usage metrics post-video, compares the predicted impact with the actual one, and updates future actions based on those insights.

Hence, with ongoing learning, AI begins to generate more intelligent, accurate, and personalized recommendations for each churn risk scenario."

The Role of Younium's Subscription Management Solution in Churn Reduction

What happens when customer details recording, routine invoice generation, and payment data collection are organized and automated?

Customers are likely to perceive their relationship as valued, leading to a reduction in churn.

Here's how a subscription management solution like Younium can achieve this:

• Providing a reliable and accurate data source: Many businesses have been manually calculating churn and other subscription metrics, leading to potential inaccuracies and outdated data. Younium provides access to clean, consolidated subscription and revenue data from various sources, facilitating more informed decision-making.
• Churn calculation and subscriber data analysis: Younium leverages historical subscription data, updated in real-time, to calculate subscriber churn, MRR churn, and even annual revenue churn. It also generates insights on churn reduction based on subscription and customer behavior data.
• Automating the quote-to-cash process: Younium interfaces with other tools in the workflow, like finance and accounting systems, ensuring customers always receive correct invoices in various pricing and currencies. It also automates renewal management, facilitating timely, relevant conversations that nurture the business relationship.

Churned + Younium: Unleashing the Power of Integration for Churn Prevention

Integrate Churned, an AI-powered customer success management platform, with Younium, a subscription management solution, to effectively prevent churn and optimize your subscription business.

• Smarter Churn Insights: By combining Churned and Younium, you gain access to rich customer data, enhancing behavior prediction capabilities and empowering you to take proactive measures to prevent churn.
• Accurate Subscription Billing: Seamlessly integrate Younium's subscription management capabilities into Churned to ensure precise and efficient subscription billing processes, eliminating errors and improving the customer experience.
• Workflow Automations: Leverage the integration of Churned and Younium to automate critical workflows such as order processing and renewal management. Streamline operations, save time, and allocate resources strategically for customer success.
• Data-Driven Decision-Making: Churned analyzes subscription, booking, and order data sourced from Younium, enabling you to make data-driven decisions to identify churn risks and implement proactive retention strategies.
• Enhanced Churn Predictions: With Churned's AI capabilities, you can benefit from more accurate churn predictions. Leverage advanced algorithms and machine learning to handle exceptions and continuously improve churn prevention strategies.

Integrating Churned with Younium empowers your subscription business to leverage data insights, streamline billing, automate workflows, and make proactive decisions to reduce churn. Unlock the power of integration and drive customer success with Churned + Younium.

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