Top reasons why RETENTION suffers
Here are 5 common reasons for retention taking a hit & here are a few of those contingencies you ought to be able to factor in, plan & prepare yourself for...
Retention is one the most discussed & a hot shot topic at most product orgs. & why not. If one is acquiring customers at the end of the funnel as a result of doing a series of things right, does it make any sense at all losing them all for any other reason?
Good orgs. & teams are totally aware of this piece of truth, which is perhaps why they acquire users with the intention to RETAIN & intern retain with an intention to GROW & keep GROWING thereof. One single largest truth that stands testimony to the health of an org. / a product that’s recently launched in the market is RETENTION, which is to say the number of users who have stayed on & are using the product over a regular cadence. And it could take various forms depending on the category of business one’s into:
But there could be many situations & permutations & combinations of things that could go wrong for an org. in spite of building the right product, which substantiates & underlines the phrase “doing the right things at the right time” [quote: The Road Ahead – Bill Gates] all the more. The focus ought to dynamically drift from building, building & building towards growth, retention & delight if one’s to witness all that effort bear fruit & multiply thereof.
So, even if your retention curve over a period of time isn’t looking exactly like the RED one & doesn’t seem to lift off that fervently, it would be great if your teams get down to doing whatever possible to match that. Because, if the curve is akin to the BLUE, which is what it would be like for most orgs. & products, that’s certainly not the time to sit tight & hang in there. Going by current market trends & how great product teams tend to function, although it could be too late, that ought to be the time to get back to the board & analyze, brainstorm & chart out a growth path towards taking the product ahead & embark on another cycle of growth.
Having said all of that, there are a few common reasons why retention could suffer. Over the course of this article we shall cover some of them & try to chart out action plans towards getting those teams out of them holes they may have got their necks stuck into.
1. Poor Product
Given how people largely understand the value marketing would add, they tend to allot the right amount of fund & do all things possible to add it to their arsenal much earlier on even when the product happens to be in the build stage itself. But as the word goes, “Marketing will well & truly get your product noticed & may also lead to a few odd sign-ups but it won’t suffice keep your users hooked”.
There are a few characteristics that could be used to define a Poor Product.
→ UX (User experience)
Products that lack a basic UX could turn sour pretty quickly as the users could disconnect with it given how the experience on the App sucks. What use would it be if you’ve employed the best of teams to build something of a product that perhaps uses disruptive technology (AI) but is found totally lacking when it comes to the user experience?
→ CX (Customer experience)
Also, once users have started using the product on a regular cadence it becomes important to focus on the overall customer experience (CX) which includes everything else over & beyond the Web & Mobile Apps, right from post-sales support, tech-support, troubleshooting, addressing last mile problems & of course cancellations.
→ Competition, Market direction / Pivots
Disregarding competition is just a BIG NO as of 2024-25 because it could put you out of place & render your product totally worthless even if it id splendidly well as it was released. One ought to keep a watchful eye over what the competition is doing & also where the market is heading generally. The trendlines just NEVER lie because they are representative of the user’s choices, the rationale that dictate the strategies / initiatives that orgs. formulate & decide what one ought to be pivoting on. If you think about it, a pivot gone wrong would usually cost an arm and a leg for most orgs. across situations.
2. Lack of Continuous Value Addition
When popular belief suggests that the reason products don’t take off is because they could be an underfit given the market’s & the user’s expectations, there are cases where some orgs. have faced the exact opposite as well. Dabbling with products one could so easily notice how this phrase begins to resonate well & stick over a period of time, “The word [PRODUCT] could so easily stand synonymous to [VALUE], in fact they could be perceived as 2 faces of a coin”. There can’t be a product if it doesn’t add value & sans the value addition there may be no need for the product anymore.
Here are a few characteristics that help define how products could add value continuously:
→ Fitment
When one says market fitment they usually talk of it over the first release & the interest in the term / maintaining relevance continually seems to dwindle down over a period of time, which could pave the way to Feature Factories. Building features that can delight ought to be at the helm for every product team & org. without which the fitment could soon take a hit & that could be enough for things to turn sour derailing the market position, losing market share as well.
→ Personalization
You have users who are coming back to use the product, your retention numbers hint at health / stability. Data never lies & tapping into the users’ trail would lead to a lot of insight on what’s going wrong or right. The lack of establishing a 1:1 connection with the users, the lack of segmentation based on the usage towards establishing similar problems & not being able to spawn innovative ways around solving it all for them could be a major reason for even the SaaS orgs. to face CHURN as it could then leave the users with a sour tinge.
3. No effort towards Onboarding
All products need an onboarding strategy & one cannot go wrong with that at all, more so today in the SaaS & the PLG era. Products that are designed in a manner where users are expected to login & just find their way navigate those user flows all on their own with minimal support from anyone ought to have user onboarding complementing that growth strategy pretty well. “With good onboarding your growth could become sustainable & scaling it could get more straightforward”.
→ Sustainable onboarding
When onboarding could be known, spoken about widely & unanimously accepted as a default next step towards retaining the users, there is a burning need to ensure that the whole effort once directed not just yields results (conversion & retention) temporarily but sustains for a longer period of time, which lands us on the topic of how one could make that whole exercise more fruitful so as to reap the best out of it, in other words make it more sustainable.
Check out this old post from TPW (The Product Web) for more about how to make your onboarding more sustainable: CLICK HERE
4. Poor Support
Although the definition of support / customer service has changed over the past few years given the advent of SaaS & PLG, it still forms as essential part of the product & more importantly in charting out the customer journeys. Not every customer would know everything & one certainly can’t go in with that expectation, ever. Moreover, it is possible that customers could run into problems any time & it’s not a given that someone who is new to the product would be the only ones who would need some help. With users getting to use the features of the product as they are released, there is all the more need to envision the support function as a continuous one & never a one-time affair like it used to be a few decades back. “Support could help a great deal in identifying & straightening out a few of those minor blockers & helping users get more bang for the buck”.
→ Feedback cycles
If you aren’t pushing those micro-surveys directed at capturing the minutest details constituting elements of UX & if you don’t run into those exercises targeted at gaining more detailed feedback that reflect customer behavior & attitudes, you’re surely missing out on a ton of detailed insight. Not only asking users about their experiences, these feedback sessions ought to be immersive enough to get a grasp over their reactions to some ideas that could turn into potential features & contribute / convert to delight.
→ Feature-level support
Given the SaaS & PLG era, you could be an odd-one-out if you wait for the users to complain about some friction points towards resolving them / weeding them out. The situation demands a degree of dynamism in terms of following user trails, running a few analytics to pin down the no. of users who are able to get to those outcomes without breaking into a sweat & dropping a few links carrying some video walkthroughs to bail them out of trouble. And if that’s is not done, you can be sure of it denting your user psyche hard & leading them on to think away from your product. You’d better do whatever possible to retain them than to let them go now & put it a titanic effort to attract them back again.
5. Lack of a growth strategy
The one mistake one can never afford to commit is to not have any growth strategy at all. It’s a toil alright building & taking the product to the market leading to perhaps a cycle of growth. But, if that is not optimized it can’t be acceptable at all. Yes, you need to consistently keep looking into new areas / segments, build those GTM strategies towards capturing them all. Your existing customer base could prove to be more than just the boiling pot & you needed to getting your hands dirty with that right now.
“Not just charting out GTMs, one should never underestimate the power of loyalty & using that as a viable marketable tool to gain market share”.
→ Inflection point
Every business that’s growing does take a pause, a breather when that graph tends to go parallel to the X-axis although the trendlines may still point upwards, needless to say it’d be in the best interest of the org. if that happens only for a brief period. Of course, keeping a tab on the trends in the market does become imperative here. But if you aren’t observant enough about certain specific trends / patterns that could reveal a lot about the behaviors / attitudes of your users you may be missing out on what could be a massive wave of growth.
For more about Inflection Points refer to this post: CLICK HERE
→ Tapping into Loyalty
The very fact that you have users adopting the product into their lives ought to give you more legs into imagining the length & breadth of the market space. You obviously would have spent some time estimating your TAM (Total Addressable Market) & that ought to act as a perfect yardstick to understand where you stand right now. And if you aren’t tapping into the existing user base, who have been using the product for long you could be losing out on some possibly great testimonials that could act as a splendid marketing tool towards attracting more prospective users.