Best Strategies to Create Loyal Customers for SaaS

The importance of loyalty can be summed up in the cost difference between keeping and earning new customers. If customer loyalty is not your priority, it's going to cost you both at the present and on the long run.

Acquiring new customers costs five times more than keeping existing customers. You don't need to spend more money, but rather refocus your strategy from acquisition to lifetime value. For SaaS companies, this is even more important because your bread and butter is MRR.MRR is your monthly recurring revenue, or how much existing customers bring in consistently month over month. Your whole business model really relies not in single purchases but on long term loyalty and customer retention: keeping your customers engaged and subscribed to your paid plans month over month.This is easier said than done. Customer loyalty is deeply rooted in building strong relationships and positive connotations and experiences which can be difficult to apply to a completely online forum. In this article we'll explore the basics of loyalty, customer loyalty programs, customer retention, and lifetime value.

Here are some ways top SaaS companies create loyal customers:

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1. Include your customers in the evolution of your product or service.
2. Build a strong emotional connection.
3. Reward your customers.
4. Listen and deliver what they're asking for before they ask.

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[anchor id=evolution]Include your customers in the evolution of your product or service.

As your product grows and changes, it's important to keep customers in the loop on how you are updating and changing it to meet their needs. The more your users see those advancements, the more your customer retention and loyalty will improve and a loyal long term customer (as we explained before regarding MRR) is money in the bank. 💰

A few solutions to keep users informed and engaged are:

• A changelog to show existing customers how your products or services are evolving.
• Segmentation, to target groups, profiles or personas in your customer base and increase the probability that the content you serve them will be effective. Irrelevant updates do not help with building customer loyalty.
• Notifications to reach customers wherever they are and encourage them to come back.

[anchor id=changelog]Keep customers engaged with a changelog.

When customers see that your team is working hard to make improvements frequently and your product is not just stagnant, they'll be more engaged. Customers are loyal to teams that work hard for them, visibly.Communicating this effectively is necessary, or customers will miss vital updates and improvements. If a product improves in a forest and no one is around to hear it, does it make any sound? No, you need to be vocal about how your products or services are growing.Sending emails is not as effective as it used to be, with open and click through rates for business emails getting lower with time and spam folders growing larger. Communicating product changes and developments in context, within your product where users are most likely to engage is the best alternative.Beamer is great for this. One of Beamer most popular tools is an in-app or site changelog that flawlessly blends into you interface where you can post announcements for new updates, feature launches, and general news for you customers. Gain inspiration from the best SaaS changelog examples to choose an attractive format for your audience. If your customers spend time in your app or with your product, why not making that time work for you in more ways than one?Customers just have to click a “What's New” tab or icon in your interface to open up the sidebar with chronological updates. You can add photos, videos, GIFs, and links, to make them more engaging. Customers can comment, react and share posts in their social media increasing word of mouth marketing.

[anchor id=content]Give your customer base the content they want.

We live in a world of feeds, from social media to our internal work tools we spend long hours scrolling down and filtering information. Avoid overwhelming your users with irrelevant data.

You can use the customer data you gather from regular interaction to learn more about them, build profiles and segment your audience in order to target them with content that will catch their attention. Make the time customers spend reading your updates rewarding by giving them tailored content, just what they are looking for!With Beamer, your team can segment updates so customers get the most relevant posts, increasing engagement and optimizing customer experience. With updates so close and intuitive, customers never miss what improvements your team has made. You can create groups, filter updates by different metrics and send customized messages for all types of customer.Customers will become more loyal if they notice that you are taking the time to speak directly to them. If you want to learn more about this subject we wrote a whole post about How to Use Personalization to Improve SaaS User Engagement.

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[anchor id=notifications]Notify users wherever they are.

Even if your products and services may be an integral part of your customers' daily routine, there will be times they are disengaged or preoccupied with other matters. ¿How to make sure they'll read your updates at the most optimal time?By using notifications, you can communicate important news even when your customers are not looking at your changelog, when they are out of your site, or even if they are logged out of your app.Beamer offers two different solutions for your notification needs:

Notifications inside your app or site.

Send in-app notifications for important updates inside your app or site. If your customer is logged in and working on something but not paying attention to your updates, just send them a friendly reminder in the form of a notification bar, snippet, tooltip or modal window.

Notifications outside your app or site.

With push notifications, your scope is larger. You can send announcements even when your user is browsing other sites or logged off. With this kind of announcement you'll make sure your customer is coming back to you when you need them.

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[anchor id=communication]Have clear and consistent lines of communication.

Building strong relationships with customers start with solid communication. Online, it's hard. You're not face to face with customers so you need to be explicit and clear in setting up lines of communication with them so they know where and how to connect with you. And a phone number is not enough anymore. ☎️The more “touch points” of communication the better. For example, many companies have blogs and forums, chatbots, support emails, hotlines, active social pages, and dedicated agents for bigger customers.It's all about finding which communication methods you can support and which work best for your customers. And finding the balance between automated solutions (bots, help centers or tutorials) and human based solutions (a phone number or ticket system).How you want to extend communication beyond that will depend on your customer base and ability. You also want to make sure you establish clear channels of communication so it's not confusing for customers as to where they can find information. For example, keep chat bots for sales and support only and use Beamer for company announcements.

[anchor id=emotion]Build a strong emotional connection.

With that being said about consistent and versatile communication, human connection is growing in importance for loyal customers.Even if your sales and support process is automated, make it still personal. For example, you can have email templates for direct outreach that are 95% completed but with custom fields to fill in with more personal details like a lead's role, company name, company, and industry details.

[anchor id=human-side]Show your human side.

We are not robots! 🤖 Many companies use as slogan some variation of "we treat you as friends and family", but no that many go beyond the words. Declaring your company as a "warm" or "human" brand, adds nothing if you're not showing those values when you interact with your customers. Remember that product or brand identity is not just text on internal memos, it's something that should be obvious to every customer that interacts with your brand.For example, some brands sign their emails with a human name and face, and use language that is closer to everyday conversation to add a warmer and personal touch to regular client outreach.Other solutions include showing that your team is human and real by sharing team photos, quotes and content from team members through your blog and social media helps create that personal connection as well: humans work here.Buffer was very successful at this by being very real about the way their team works and what they were up to on their blog and social pages as the company has grown.

[anchor id=transparency]Be transparent as a company.

Customers expect to interact with companies, brands, products or services like they're real people. Being transparent with customers helps build trust and earns their loyalty!For example, if your team experiences problems or makes a mistake, say so outright in your communication with customers. Be transparent about the way you do business.Again, Buffer really broke ground when they decided to share both their remote work structure, their internal organization with all roles defined, and their salaries at each position with their customers. It's not that it's important, but telling the story and keeping people up to date with what's happening at your company, even the bad things, helps them feel like they are in the know and can trust your team and your brand.

[anchor id=roadmap]Build a roadmap!

Another way to be transparent as a brand is to show publicly what you're working on and how your team has planned to keep improving your products or services. The best way to do that is with a roadmap. 🗺️What is a roadmap? Well, it's a tool that publicly displays some or all of the following information:

1. What updates, features or projects is your team working on?
2. What tasks or projects have they already completed?
3. What new updates are you thinking on implement for the feature?

Beamer also offers solutions for this need! With Beamer you can easily build a roadmap, publish updates and make it public in minutes. On the other hand, you can encourage customer feedback by asking your users to send their own feature requests and to vote on what updates they value more.With Beamer Roadmap and Feature Requests, keep your customers informed, engaged and happy. And let them guide you on what they wanna see next from your product. Happy customers are loyal customers! 💖

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[anchor id=rewards]Reward your customers.

This is a given but there are so many ways you can do this that help strengthen your relationships with loyal customers. Rewarding customers who are avid users of your products or services is important because they're likely to become promoters of your product.

[anchor id=nps]Use NPS – Net Promoter Score.

For SaaS companies, NPS or Net Promoter Score is the easist way to mesure customer satisfaction. And it's important because it lets you know how many of your customers are happy enough with  your product to recommend it to other leads like them.NPS is simple: you ask your customers to rate a prompt like "How likely are you to recommend this product to a friend or colleague?", "How much are you enjoying our app?", "How much do you trust our brand?" or "How likely are you tu purchase one of our products or services again in the future?". You can use that data to separate customers between promoters (your most loyal customers), passives (customers with low to none loyalty) and detractors (customers that are likely to cancel their subscription or give you bad reviews).By identifying these types of customer, you can take action to improve your relationship with your promoters, and change the mind of your passives and detractors.Beamer offers a powerful and easy-to-use NPS tool to help you embed surveys and other ways to measure customer satisfaction right within your product. With Beamer NPS you can not just gather useful ratings, but also include follow up questions and ask for contact details. Gather more data and make your research process easier.To learn more about NPS and how to implement it to great success, you can read our posts about it:

• What is NPS, Why it Matters, and What Can it Do for you?
• What is a Good NPS Score for SaaS?
• Understanding SaaS NPS Detractors (and What to Do After)

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[anchor id=loyalty]Creating customer loyalty programs.

Peer to peer recommendations and word of mouth are extremely effective in building brand awareness and getting qualified leads. And that process is fueled by customer loyalty.To generate more loyalty, rewarding your top customers is a must! Give your customers actual rewards. 🏆A customer loyalty program is more than just a list of prizes and rewards. It's not just giving rewards and money away. It's a whole system that needs to identify customer loyalty and give rewards that can build a stronger relationship and create a virtuous cycle. Customer loyalty helps build customer loyalty.When creating a loyalty program think on the following:

• What data will you use to measure customer loyalty? Like NPS or other types of direct outreach and research.
• How will customers earn the rewards? What behavior are you looking for? Like user-created content, repeated purchases, time customers spend using your app, positive ratings and reviews, subscription time.
• What rewards will you give away? Like discounts, credits, early access to new features, priority / faster support and opportunities to upgrade to new subscription levels for less.
• How will these rewards improve customer outreach and loyalty? Remember that you are trying to build customer loyalty by tapping into your already loyal customers.

[anchor id=pricing]Offer options in pricing and features.

Pricing can be a way to earn points with your customers. The amount of money businesses spend in your product may make or break your relationship with them. So by crafting a good pricing strategy, you can also increase customer loyalty.Here we'll summarize two different approaches to pricing that can allow you to retain customers, get repeat purchases and increase loyalty:

Value-based pricing.

Pricing for your customers, is about how much they value what you offer and what price they assign to that as acceptable. Value-based pricing let's your customers make your pricing work for them and their specific needs.

It focuses on pricing around the qualities that make your product or service valuable over the rest of the market. And it's ideal for SaaS!

Value-based pricing requires that you look at your features and competitive differences and that of competitors and price according to what customers are willing to pay for certain functionality and factors.

For example, Hubspot's pricing may feel expensive, but they know what their customers value. They know that their customers can make exponentially more with their tools and features than with the competition, solve many pain points with a single tool. And so, people are willing to pay and are happy to do so.

Growth-based pricing.

Another pricing strategy that makes customers feel they are getting what they value is pricing based on their growth and specific features.

If you allow for incremental changes in pricing that grow with customers needs, they feel this is more tailored to them and will stay onboard. It also helps to allow customers to add different features to their plan “a la carte” without having to jump to bigger subscriptions with features they don't need.

Intercom, for example, offers baseline pricing for each level which then grows based on users and “add-ons” for additional, individual features.

[anchor id=listen]Listen and deliver what they're asking for before they ask.

Go above and beyond and deliver what customers are going to ask for! This means listening to customer pain points, watching where they experience friction, and being aware of their market and work processes outside of your product so you can continue to make a product that meets their needs, now and in the near future.

[anchor id=how]How to listen to your customer?

Some ways of listening to customers to feed the loyalty cycle are:

Direct feedback.

Comments, ticketing systems and contact forms allow you to hear what your users have to say in their own words. Even if it takes a lot of effort to filter this kind of feedback, it's the closest you'll get to understand their pain points and what's really on their minds. Responding to direct feedback can also help you forge a stronger relationship with a customer.

Surveys and ratings.

Surveys are not only good solutions for marketing research. Regular surveys and NPS surveys, can help you focus the feedback on specific topics and, as we explained before, to identify potential loyal customers (like with NPS). While regular surveying can mean a lot of money, NPS widgets allow you to automate the process and repeat a single prompt with little human involvement.

Scanning for comments.

Finding social media mentions and customer reviews is good practice for any business. Even if users may not be willing to give you feedback, they may share their opinions in other platforms. Social media also gives you the opportunity to respond: tell your customer that you fixed their issue or show interest in what they have to say. That will also build customer loyalty.

Product usage metrics.

Watching how customers and members interact with your product and what they use and don't use provides you with useful data. You can use that information to optimize the most critical aspects of your service and provide solutions to pain points.

Beamer is a great way to see exactly how your customers feel about your product or service. When you make announcements via Beamer, users can add a reaction and in-content feedback as comments.This can help your team better understand what's working and what's not. Staying up to date on market news and changes for your target markets is important too so they you can ensure your solution shifts with demand.

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[anchor id=feedback]Feedback needs an answer.

Feedback is not a tool for users to free their minds of their frustration. Is a tool to build better relationships between business and customer. If you want repeat customers, to keep them satisfied, or even for them coming back even after a bad experience, you need not just to listen but to take action.Spend time looking at customer feedback, identifying your users' most critical pain points and solving them. Notify users about the changes you've made and then repeat the process and close the feedback loop. Build customer loyalty by showing them that you care about what they have to say. Read our blog "10 Tips for Collecting Meaningful Customer Feedback" to learn the best practices.A few examples:

• A big picture example, Netflix knew their product of DVD delivery was dying so they shifted to a streaming option ahead of the market.
• A smaller example: Hubspot knew there were plenty of emailing services out there, so they focused on sales personalization, automation and CRM, and opened up integrations.

These are all ways to do one thing that really is the key to building customer loyalty: creating and maintaining a product that serves your customers' pain points in the best way possible. If you have a focus on this and a personal touch from your team, customer loyalty becomes the effortless byproduct.

New customers may mean short term growth but customer loyalty means long term returns and lifetime value. If your SaaS company is looking to keep users engaged and to increase customer loyalty, try Beamer today.Learn about the importance of NPS for PLG companies in The Ultimate Guide to Tracking NPS for PLG Teams.Read the article "How to make sense of all your customer feedback" to learn how to best collect, summarize feedback and share your analyses to help developers fill and prioritize your product roadmap and build positive, productive relationships with your customers.