The second blog post in our 3-part Xanax for SaaS Execs series, we're talking about how customer service can affect churn rates and what you can do to reduce customer churn.

    What keeps SaaS executives up at night, and how can they get a better night’s sleep?

    As I outlined in Part 1 of this series (The First Pill) the Software-as-a-Service (SaaS) landscape continues to grow exponentially, and Canada is no exception. Investment in Canadian SaaS companies reached $1.62 billion in 2018 across 229 deals, up from $1 billion and 100 deals in 2017.1 The Canadian cloud economy contributed an estimated 8.2 billion to Canadian GDP in 2018, up from 4.6 billion in 2013.2

    And the nation’s capital leads the country – and North America in fact – with the highest concentration of high-tech labour as a percentage of its workforce at 11.2%.3 It boasts a vibrant mix of incubator organizations including Invest Ottawa, LSpark, OneEleven, and the Kanata North Business Improvement Association. In only its 3rd year, Ottawa’s 2018 SaaS North conference drew 1500 entrepreneurs from 500 growing companies. And the SaaS Ottawa Meetup group boasts just over 800 members.

    All of this investment, support, and growth is a great news story for Canadian SaaS companies, as well as non-SaaS companies dipping their toe in SaaS waters for the first time. However, as you might expect, growing pains are causing SaaS execs some sleepless nights.

    I’ve had the opportunity to sit down with a number of SaaS company founders and senior execs to learn what’s keeping them up at night, and what they’re doing to get a better night’s sleep. I’m sharing insights from those conversations in a series of blog posts. I’m also adding in gems from SaaS North, where a number of founders and CEOs generously shared lessons learned along their journeys.


    The Faster You Grow, The More Focus Needed on Customer Care

    A common theme I heard across B2B SaaS companies of various stages and sizes was around customer service and customer care, which is such an essential element for SaaS companies. Poor customer service is often called out as a top reason customers churn.4

    As Kinaxis CEO John Sicard explains, this is especially challenging for companies who started out in a perpetual license model and subsequently moved to SaaS. Whereas in the past they may have taken a reactive approach to customer care, waiting for customers to reach out and log cases, in a SaaS model, the value for customers extends far beyond the software component.

    Customer Care organizations must monitor all elements of the service, proactively anticipate issues, and solve them well before customers can feel the impacts.

    And while pro-actively anticipating and resolving issues before clients are impacted is nirvana, it ironically creates another challenge when you get there. If customers don’t see the issues, and don’t know your company is working around the clock to pro-actively prevent or resolve them, will they value what you’re doing?

    To make sure they do, some companies prepare and regularly share “While You Were Sleepingreports with each customer – outlining all of the issues that were pro-actively solved before the customer was even aware or felt any impact. This is a brilliant way to ensure customers know you’re delivering value, well beyond the software itself.

    Even if organizations were born SaaS, rapidly growing B2B companies have their own unique challenges. They quickly find that the number of enterprise customers they need to support grows faster than their ability to scale their customer support model, technology, and processes. As one B2B start-up with impressive foresight is doing, rapidly growing organizations are wise to anticipate and plan for this reality.

    The start-up founder shared that as they grow, they already know they won’t be able to provide the same level of high touch support they provide to their early adopter clients today. This founder is concerned about how to scale the support model without alienating the very clients that put them on the map in the first place. One of the approaches they’re taking is investing in the most frictionless ticketing system and knowledge base possible, and seeking early customer input into how to evolve their support model together.

    As SaaS companies continue to focus on improving customer service and customer care, they are wise to ensure ongoing engagement and dialogue with early adopter and power user customers. These groups of customers value being part of evolving the product and its ecosystem, and as a result, will be much more accepting of the resulting changes.



    1.  Canadian SaaS Companies Secured Over $1 Billion of Investments in 2017 (BrainStation)

    2. CANADA'S CLOUD IMPERATIVE: Improving Business Opportunities Through Enabling Services (ICTC) via LSpark
    3. New Study Rates Canada’s Best Cities for Tech Talent

     (CIC News)
    4. The Three Leading Causes of Customer Churn (Retently)


    This article was published more than 1 year ago. Some information may no longer be current.