Keep the Competitive Edge and Reduce Churn

Frequently, customers leave your product ecosystem, leaving you puzzled about the reasons behind their departure. Maybe your product was once the best option on the market, but due to missing features and difficulties, its competitive edge has dwindled. Alternatively, customers might encounter challenges in using the product, thereby undermining the initial value proposition that drove their adoption. Frustrated customers = high churn!

The goal is to discover these reasons before customers churn. This objective can be achieved by analyzing a blend of leading and lagging indicators. By proactively identifying and interpreting these indicators, teams can cultivate a comprehensive understanding of customer behaviors and sentiments. Armed with this insight, teams can implement well-informed strategies, preserving customer allegiance and diminishing the prevailing churn rates.

In this webinar, Johanna Rothman will demonstrate how to spot lagging indicators early and when to use them to keep your clients and reduce churn!

Transcript

1. Keep the Competitive Edge and Reduce Churn Tara Dwyer Webinar Coordinator Product Management Today Johanna Rothman Management Consultant, Rothman Consulting Group September 12, 2023 9:30am PDT, 12:30pm EDT featuring moderated by
2. Revenera helps product executives build better products, accelerate time to value and monetize what matters. Revenera's leading solutions help software and technology companies: • drive top line revenue with modern software monetization, • understand usage and compliance with software usage analytics, • empower the use of open source with software composition analysis, and • deliver an excellent user experience for embedded, on-premises, cloud and SaaS products. To learn more, visit www.revenera.com.
3. TO DIAL IN AND USE YOUR TELEPHONE: Dial: +1 646 558 8656 Webinar ID: 865 8310 4876 Passcode: 305913 This Information Is also available In your webinar confirmation email from Zoom. Have a question for our panelist? Type into the Q&A panel to interact with our speaker!
4. Johanna Rothman Management Consultant, Rothman Consulting Group Keep the Competitive Edge and Reduce Churn
5. © 2023 Johanna Rothman @johannarothman We want to retain customers Sometimes, they leave unpredictably Why? 5
6. © 2023 Johanna Rothman @johannarothman Personal Stories • Change in UI/UX • Change in pricing structure • Discontent with original (“only”) choice, see an alternative (sometimes feature-superior, sometimes not) 6
7. © 2023 Johanna Rothman @johannarothman People Leave Products Because… • No longer need any solution • Product no longer offers the same impact: • Price • Satisfaction (experience) • Experience using the product outweighs the impact the customer receives 7
8. © 2023 Johanna Rothman @johannarothman Insuf fi cient Impact —> Frustration Frustration —> Churn 8
9. © 2023 Johanna Rothman @johannarothman Our Agenda 1. Why customers start to use your product (the hook & impact) 2. When you care about churn and when you might not care as much 3. Measures to consider at which points in the product’s lifecycle 4. Leading and lagging indicators 5. Churn reduction strategies 9
10. © 2023 Johanna Rothman @johannarothman 1. Your Product’s Hook • Your product’s hook is the promise you make to your ideal customers • Who do you want to buy your product? • What problems does your product solve for those people? • Your product offers impact to solve those problems 10
11. © 2023 Johanna Rothman @johannarothman Consider Personas for Identi fi cation • Personas help you explain (to internal people) • Ideal customers • Ideal problems • What matters to those customers (impact) 11
12. © 2023 Johanna Rothman @johannarothman 2. What Matters to Which Customers When 12 From Create Your Successful Agile Project
13. © 2023 Johanna Rothman @johannarothman Early Cares About Churn • When you’re discovering the product and the customers, you might want churn • By the time you want to cross the chasm, you only want additional customers and to reduce churn • Enthusiasts want “more!” • Visionaries want “solve this problem!” 13
14. © 2023 Johanna Rothman @johannarothman Implications for the Early Market • Flexibility in problems you choose to solve (& impact the product makes) • Customers expect frequent releases • Flexibility in defects • But as you approach the mainstream… 14
15. © 2023 Johanna Rothman @johannarothman Mainstream Flips Everything • Your maximum number of customers • Reducing churn here matters the most • Notice what matters to them: • They don’t need a lot more features, but they need the features to work • They need relatively frequent releases 15
16. © 2023 Johanna Rothman @johannarothman Retain Customers as Product Approaches EOL • Most products appear to be “cash cows” here • They don’t care much about new features as long as the features work (max impact) • Goal: Retain customers and reduce churn 16
17. © 2023 Johanna Rothman @johannarothman Retain customers by offering impact. Product meets their expectations. 17
18. © 2023 Johanna Rothman @johannarothman 3. Chasm/Mainstream Measures • As you increase the number of customers, they expect: • Time to value is short • “Typical” product paths work (solve their problems with maximum impact) • Suf fi cient features to solve most of their problems • Installation/registration ease 18
19. © 2023 Johanna Rothman @johannarothman Logs for Insights/Measures • Leading indicators: • Abandon the registration (insuf fi cient ease) • Requests for more features (not solving the problems the customer has) • Requests for “how to” videos/ documentation • Each of these says something isn’t quite right 19
20. © 2023 Johanna Rothman @johannarothman 4. Indicators • First, remember this: • The more you instrument the code, the faster you can receive the measures • Validate your data with more than one user’s experience • Remember that the older the data, the less valuable it might be 20
21. © 2023 Johanna Rothman @johannarothman For all products: How easy is it to onboard the customer? 21
22. © 2023 Johanna Rothman @johannarothman What to Measure for Leading Indicators • Abandoned registration • Never-installation • Before the customer starts, they stopped • Gather qualitative data to understand why: • No survey. Talk with them. 22
23. © 2023 Johanna Rothman @johannarothman Lagging Indicators: From Logs to Measures • Defect escapes: • Any measurable response time • More features: Gather request data from Customer Support/Success • How-to requests: Instrument requests for documentation or videos 23
24. © 2023 Johanna Rothman @johannarothman Learn Which Features Have Most Impact for Whom • Consider these ideas: • Most popular features by persona • Least used features overall • Who checks for video/text documentation? 24
25. © 2023 Johanna Rothman @johannarothman Product Usage Measures • Instrument the product to detect churn here: • Defect escapes in the typical paths • Intermittent problems • Substantial UI change • Fee/payment changes and (lagging) usage changes 25
26. © 2023 Johanna Rothman @johannarothman Time Series to Af fi liate Big Changes with Dates • Example: • Product release on July 1 • Huge bump in how-to videos and Customer Success requests post- release • Time Series can help everyone see that as early as possible 26
27. © 2023 Johanna Rothman @johannarothman 5. Churn Reduction Strategies Depend on the Change • Different users: create more A/B tests • User experience: experiment fi rst • Pay structure: Analyze your competition and see where your customers have alternatives • Watch the market for challengers to your product • Verify your product’s promise matches the product’s reality 27
28. © 2023 Johanna Rothman @johannarothman Big Ideas • Remember what matters to your ideal customers and when • Instrument the code & product and use a time series to see changes early • Pay attention to when users contact you • Always clarify your ideal customers and the promise you make them 28
29. © 2023 Johanna Rothman @johannarothman Let’s Stay in Touch • Pragmatic Manager: • www.jrothman.com/ pragmaticmanager • Please link with me on LinkedIn 29
30. /in/taradwyer/ Q&A Johanna Rothman Tara Dwyer Webinar Coordinator, Product Management Today /in/johannarothman/ jrothman.com Management Consultant, Rothman Consulting Group productmanagementtoday.com
31. Revenera invites you to learn more about reducing churn and other ways of growing recurring revenue with product usage data! Check out the Revenue Optimization Guide for Software Suppliers available on Revenera’s blog, and then join Vic DeMarines, Revenera’s VP, Product Management for Software Monetization for a 25 minute webinar on leveraging entitlement usage data to hit your revenue target. Find the article here: Find the webinar here: