Proven Strategies To Boost Customer Loyalty

by Richard


You’ve invested a lot of time and money in building an awesome SaaS. Your product is so cool that once customers try it out they’ll surely be hooked, right?

Unfortunately, no. The average annual SaaS churn rate is between 5 and 7%.

Customers are often not particularly invested in your product beyond ensuring that it does what they need, even if it is cool. They can be a fickle lot, on the lookout for the next big thing that grabs their attention.

Studies have shown that the cost of keeping a customer is about 10% of the cost to gain a new one, so it makes good sense to put effort into keeping the customers you already have and getting them excited about your brand.

Companies like Apple have customers lining up around the block for new products without a huge marketing effort. They engender enviable levels of brand loyalty – what can your business do to get closer to this level?

Get Service Right First

Remember, this is assuming you’ve got a great product which answers the needs of the customer. If your product is amazing but your customer service is shoddy, you will lose a good proportion of your clients out of sheer frustration.

We won’t labor this point – it’s the obvious first step and we covered some strategies for improving the customer experience recently. If you want to build brand loyalty, your business needs to have good service first. This will be the foundation for any other strategy you bring into play…

Get the recipe for an effective loyalty program. Download for free here…

Ask For Engagement

Engagement begins with the customer actually using your product and being able to derive value from it. How many people do you have lurking around inactive on free trials or your first tier of service? Getting proactive about gaining their engagement is important – they’re either loyal or they’re part of the next lot to cancel.

As Lincoln Murphy says, this isn’t the gym. “Engagement is when your customer is realizing value from your Saas”. He further points out that engagement should be seen as a customer issue, not a product issue.

You will not develop loyalty if you don’t first foster engagement. How can you ask for engagement? Here are some examples;

Mention: “Use-case Master Class” webinar

As part of an overall churn-reduction strategy, Mention ran the Masterclass webinar to demonstrate concrete examples of their impact on ROI of users. The webinar also has a forum for users to ask questions.


Zendesk: “The Human Touch”

Zendesk wanted to avoid being the kind of company who only calls when they’re seeking renewal, so they implemented a Customer Account Management (CAM) team on a 12-month schedule of phone calls, emails and check-ins.

This helps curb potential issues, build trust and develop customer loyalty. Customers establish a real relationship with the company and are more likely to refer others.

Dropbox: Incentives

Dropbox has built a multi-billion dollar company without spending a huge amount on advertising. They use incentives quite effectively to gain engagement. Users can earn extra storage space by going through their product tours and completing other activities, such as sharing on social media.


There are many other examples we could mention to help build engagement: drip email campaigns, consistent social media engagement, video tutorials, contests… The important thing is that you are doing something effective to gain engagement.

[tweetthis]Engagement is when your customer is realizing value from your SaaS[/tweetthis]

Build A Real Connection

Why do brands like Apple produce such raving fans? It’s not just that they love the product: they feel connected to the brand.

Steve Jobs was a master at connecting with customers and getting them to identify themselves with the Apple brand; “The coolest thing about iPod is that your entire music library fits in your pocket”.

Tell your story

Did you know there’s science behind why storytelling works to help gain you loyal customers? Storytelling engages a wandering brain and lights up parts that a factual report doesn’t. It can emotionally engage the listener or reader, causing them to produce oxytocin and impact their behavior.

A compelling story builds a true connection with your customer. Those customers lining up outside Apple stores aren’t just buying a product, they’re connecting with the brand at a personal level. Your story is what makes you relatable to other humans.

Here are some examples:

  • Salesforce tells stories around their customer successes, making real-world examples accessible.
  • HubSpot connects through excellent content, customer stories and immediately connecting with the sentiment of their visitors (“stop interrupting, start connecting”).
  • Intel has done a great job of taking how most people think and feel about technology and injecting it into their everyday lives.

Develop a true understanding of your customer

Do you really know who your customer is? What are their dreams and challenges? If you understand them you can foster loyalty by tying your product to helping them achieve those dreams or overcome those challenges. You can also better focus your stories so they demonstrate those things.

Gregory Ciotti has written a lot on customer loyalty. He makes a great point when he says: “Many marketing campaigns are designed entirely around moving products. What if instead they were designed around moving people?”

To move someone, you need to understand what really spins their wheels; what are their motivators? Conversely, what do they disengage with?

Monitoring your metrics and the reactions to your content are some ways to understand your customer. You need to be able to answer questions about who your customers really are.


Image source: Business2Community

Upgrade The Features That Matter

Most SaaS tend to find over time that some features are more important to customers than others. These are known as “sticky” features, because no matter how you upgrade you shouldn’t lose those features!

How can you use sticky features to boost loyalty? By improving on them – giving them more power or better quality. Customers are unlikely to cancel if your best features are made even better.

Most customers also dislike change just for the sake of it, so if you are showing that you understand which features are important to them, it goes a long way toward them supporting you.

Reward Your Customers

Most of us like good surprises, right? Surprise rewards can help businesses create powerful and lasting bonds with customers. ‘Surprise and delight’ strategies are being used more often as part of long-term loyalty builders.

How could your SaaS ‘surprise and delight’?

  • Extra storage.
  • Free upgrades.
  • Discounts.
  • Added features.

Choose something that is relevant to your product and meaningful to your customer. With these types of rewards, you don’t tend to have an initial cost outlay, unlike physical goods. Also, you already know your customer is interested in these rewards because they use your product!

We know rewards and loyalty programs work if they are well-managed. Some businesses argue that they can’t afford them, but there is plenty of documented evidence of businesses increasing revenue from reward programs.

Build an effective loyalty program. Download our free ‘recipe’ here…

Final Thoughts

Customer loyalty begins with your SaaS having a great product, excellent service and a true understanding of your customers.

From there, engagement efforts, building connections with your customers and rewarding them for their business will all help create a brand that engenders trust and loyalty.

Kill your churn. Keep more of your customers. Get an invite to Retained.

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