The Lifecycle of Loyalty: Tackling Churn at Critical Stages in the User Journey

Casey Hill


Senior Growth Marketing Manager


Casey Hill
Casey Hill

Episode Summary

Today on the show we have Casey Hill, the Senior Growth Manager of ActiveCampaign.

In this episode, Casey shares his insights on navigating churn by focusing on the critical stages in the user journey to foster loyalty.

We explore the nuances of addressing churn from initial engagement through to long-term retention, highlighting strategies for each phase: activation, impact/results, and loyalty.

The discussion offers actionable advice on how to enhance customer retention rates and improve the overall customer experience.

Mentioned Resources



Introduction to Casey Hill and ActiveCampaign's Mission00:01:04
Lessons from Hill Gaming Company and Kickstarter Success00:03:34
Transitioning to ActiveCampaign: Startup to Scale Challenges00:05:32
Strategies for Reducing Churn: The Activation Stage00:10:06
Deep Dive into the Impact/Results Stage of User Engagement00:20:21
Building Loyalty and Advocacy Beyond 180 Days00:30:19
The Role of Annual Plans in Retention Strategies00:37:40
Wrap-Up: Key Takeaways on Churn and Loyalty00:44:25


[00:00:00] Casey Hill: I think that the biggest thing that I've changed with churn is that in the beginning of my career, I think I just looked at churn as an aggregate. If you really want to drive actionable results, you have to get into that specificity. The actionable components are in the specificity.

[00:00:24] Andrew Michael: This is, the podcast for subscription economy pros. Each week we hear how the world's fastest growing companies are tackling churn and using retention to fuel their growth.

[00:00:37] VO: How do you build a habit-forming product? We crossed over that magic threshold to negative churn. You need to invest in customer success. It always comes down to retention and engagement. Completely bootstrapped, profitable and growing.

[00:00:50] Andrew Michael: Strategies, tactics and ideas brought together to help your business thrive in the subscription economy. I'm your host, Andrew Michael, and here's today's episode. Hey, Casey, welcome to the show.

[00:01:04] Casey Hill: So glad to be here. Thanks, Andrew.

[00:01:05] Andrew Michael: It's great to have you. For the listeners, Casey is a senior growth manager at ActiveCampaign, a custom experience automation platform helping over 185,000 businesses in 170 countries worldwide. Prior to ActiveCampaign, Casey was the head of growth at Bonjoro. He's also a startup growth consultant and advisor to McKinsey, BlackRock and Growth Mentor. So my first question for you Casey is, how much of your experience building Hill Gaming Company helped shape your approach to growth?

[00:01:36] Casey Hill: It's a good question. Yeah, so Hill Gaming Company was basically a company that started as a Kickstarter. It's actually a physical card game. I kickstarted and raised $40,000 for that in 2018. It actually taught me a lot. So running my own kind of micro e-commerce business, I had to learn a couple of core buckets. Number one, I was managing about eight different freelancers. So there was a lot of organizational thing and I was also running all my own ads, building my own website, taking people through, you know, my own funnel. I was working in the automation world and the MarTech world as my day job. And now I had to actually test these things in real life with my own business, with my own budget. And so it was phenomenal. Learned a lot about fulfillment. Learned a lot about shipping logistics. Yeah, it was a great experience.

[00:02:21] Andrew Michael: Amazing. And being a game itself as well, did you focus on sort of any of the game mechanics and that behind it? Didn't you have that sort of influence your work in any of your roles?

[00:02:30] Casey Hill: Yeah, yeah, absolutely. So I definitely grew up a gamer. I come from a family of seven. My older brother actually was a physics PhD and also a professional Magic The Gathering player. So we actually got flown around the world to play and so he also helped on the mechanics and the building side. But I think one of the things I really took away on that side was the importance of play testing. And it's funny because that actually has a lot of parallels to the software world. Right? This idea of gathering customer feedback, having kind of a customer feedback driven plan.

[00:03:00] Casey Hill: We went to dozens and dozens of stores all over California. People play, tested the game. We aggregated that feedback and it was constantly an iterative process. And we had over 100 of those play testers show up on day one of our Kickstarter, which was really encouraging to see that kind of support come the time to crowdfund it. But that was definitely instrumental in making the game balanced and effective for sure.

[00:03:23] Andrew Michael: Yeah, so it sounded like you're early beta users as well, and then stepping up when the product launches and product time sounds something similar to that, if you think of startup analogy.

[00:03:33] Casey Hill: Totally.

[00:03:34] Andrew Michael: And nice, so you as well previously at Bonjoro. We chatted about this before the show, like going from that zero to one phase and then growing with them. Now you've stepped into a role at ActiveCampaign, a much larger beast as well. What's been one of the biggest changes stepping into this role and what's probably like the common thread that you see between them?

[00:03:57] Casey Hill: Yeah, great question. I think that when you're operating in a startup environment, I think oftentimes micro wins, as I might call them, make a ton of sense. Like you run a small webinar, if that gets you four customers, like that's just worth it. Like you're just going to do that. You're going to scrap to get whatever kind of business you want and bring that through the door. When you start to work at a larger company, the orders of magnitude are totally different, right? You're talking about tens of thousands of trials, right? And thousands and thousands of customers.

[00:04:25] Casey Hill: So you oftentimes have to start thinking about growth from, kind of this layer perspective. You need stuff that's scalable and can kind of layer on top of itself and has that long tail effect. So for something like a webinar, that really only makes sense is, if you can turn it into, like a series, right? Where it keeps stepping up and it keeps layering on. So I think a big change in terms of the growth mindset is you have to kind of move away from just those micro wins and you start looking really at things that have that scalable potential.

[00:04:54] Casey Hill: The other thing is there's a lot more resources and a lot more people that you can tap into at a larger organization. So that's… that has pros and cons, right? The pros is that you have resource backing, all of that kind of intellectual collective insight. The cons is there's a little bit more red tape. Things can move a little bit slower because now instead of just being the decision maker, I'm like, we're doing X we go, there's a lot of stakeholders to get bought in. So there's kind of pros and cons, but definitely having a machine and a mechanism behind you that can really push hard is pretty cool. And it's nice to have that when you're trying to drive growth swings.

[00:05:32] Andrew Michael: Yeah. It is a big change. I think going from an early stage startup, having all the resources behind you then, to be, able to do a lot of things you probably always really wanted to do at that small startup, but just weren't really practical or made sense at the time for you there. And I like sort of the way you phrased as well, like being able to layer on and build on top of things and thinking about more of, bigger wins at the end of the day.

[00:05:55] Andrew Michael: Today, we discussed like a good topic and something I think that you've worked on in the past, [inaudible] was really going to be around this idea of churn and retention at different stages of the user journey, and you broke them down into three different stages and maybe if you can just give a little bit of an overview of what those stages are and we can dive into then your thoughts and experience in those areas.

[00;06:18] Casey Hill: Yeah, absolutely. And I'm super excited to chat with you on this because there's so much conversation right now from funds and in the public about how this is the year of efficient SaaS and, you know, NRR and churn are top of mind being discussed constantly. And so anything we can do to kind of tactically jump in and tackle these buckets, I think is super valuable. So one of the things I started doing a handful of years ago is when I was analyzing churn trends within the organization I was working as well as in my consulting work, I started to find that the reason that folks churned was very fundamentally different depending on the stage they were in.

[00:06:51] Casey Hill: So I started to break down. We have, activation stage churn. This is zero to 30 days, right? And I'm gonna give general day marks. Again, depending on the organization, if you're enterprise versus SMB focused, there's gonna be some nuance there, right? But this is a general way for you to frame it. Zero to 30 activation, and we can dive into a lot of things that are relevant in that stage. The next one is 30 to 180. And that's kind of this impact results phase where you really need to drive tangible impact and results with the software.

[00:07:22] Casey Hill: And then you have this loyalty phase, which is kind of day 180 plus. It gets looked at the least by far of any of these phases of churn, but it's also super important because these are some of your biggest advocates. These are some of the people that have the most what we might call second order revenue potential. And so it's a super important one to kind of unpack what it looks like to keep those people on board. So, those are the three, kind of main broad phases that I would bucket people into.

[00:07:49] Andrew Michael: And why those specific timeframes?

[00:07:52] Casey Hill: Yeah. The reason for the specific timeframes is that the reason again, that people fall off is very different. So if we start with activation, right, people come in and the first thing that's supercritical is going to be that initial experience and it's very much about, feel at this stage. If you think about software or things that you use personally, you'll find that there's not an expectation that you drive a dramatic result on day three. What happens is you start to get set up and there's all these pillars of that initial setup phase and you're kind of getting the sense of, is this intuitive? Do I feel supported? Do I understand how to navigate the interface?

[00:08:26] Casey Hill: So one way to look at this is I kind of like to start all the way at the top. One of the things that I kick things off with is, are you bringing in, right fit folks, right? A lot of times people have these trial numbers and they have these huge pockets of trials. They don't understand, like why are these people not activating? And what we find is there's often a disconnect between the marketing messaging on the site, someone signs up for a trial and the expectation is different.

[00:08:52] Casey Hill: So the very first thing before we get into any of the other logistics is you need to make sure that you have that match and you actually wanna make sure that you reach out and try to get connected to those people that don't activate, like don't do anything and talk, try to have conversations with those folks so you can peel out what did they think this was? What was that gap in expectation? So you can go fix your paid messaging, you can go fix the messaging on your website or your landing page or wherever you're driving people to. So I think that's step one, is make sure you're bringing the right folks.

[00:09:24] Casey Hill: The second piece is I spent a lot of time and I talked to a lot of different founders and CSMs and all sorts of folks about that initial onboarding experience. And what I found is that three to four touch points during the first two weeks was the sweet spot. But most teams actually had six to 10 touch points, right? From email, from prompts, from, it just becomes bloated over time. What happens is people set up a flow, then they start to add all these triggered flows. Well, if someone does this action in my software, then send them another message. And then there's not coordination between departments. So you have your onboarding flow, but then you might have a certain marketing flow. And it's pretty soon people are just inundated.

[00:10:06] Casey Hill: So one thing that's really important for people to pull out is that it does not matter how good your messaging is. If you hit people 10 times, they're just gonna be flooded. They're gonna tune out, they're not gonna pay attention. So I think that, take a step back. If you need to do, kind of a customer lifecycle map, you can do that, where you put each of the different departments, you look at, when is sales contacting them? When is marketing contacting? When is onboarding?

[00:10:28] Casey Hill: But one of the things that I find again here is that personalization, while super powerful, can often be one of the reasons this happens because what people do is they have their original core activation flow and they just layer in more and more personalization touch points, which makes sense in their head because they're like, oh, this is gonna be great. But really what produces the best results is a blended approach. So personalization, I'm a strong advocate, but it needs to be alongside your original core messaging. You don't wanna just keep adding more and more steps. So that's kind of the second piece. Once you qualify that these are good people, that are good fundamental fit, you wanna look at that first two weeks and make sure that's really seamless.

[00:11:10] Casey Hill: The next piece on this is I think people underestimate how critical response time is. I think there's a huge… people don't realize the difference between a five minute response time and a one day response time when people are starting out. Again, this first phase of activation is all about feel and people will tune out, people will disconnect, people will leave. They're not at that proverbial aha moment yet, right? That hasn't hit. And so because they're not at that moment, you being engaged and them getting the sense that this is gonna be a team that's very responsive, even if possible, and I know again, this varies by brand, but if possible, having a point of contact where they know and they feel comfortable that I can go to this person if I have specific questions.

[00:11:49] Casey Hill: And again, I understand that based on scale for some SMB focused organizations, that's not possible, but it's important just as a North star to be aware of, like this is what a customer wants. So I think that response time is then critical. I also think it's really important for folks to think about the journey of when someone signs up for a software, like how do they normally approach it? When I sign up, I often skip, like all the checklists, all the prompts, I just try to go in and do directly what I wanna do. And if I can't find the answer, I go to Google and I type it in, and I type in like split testing, insert software name, right, to just try to find that specific article, that specific thing that I wanna do.

[00:12:30] Casey Hill: So what that means for you is that you might lose people if they get into the software and it's just like, okay, you get the checklist and then here's this onboarding guide and they're just getting pop-ups here and there and they're trying to be taken through everything. Instead, try to stay really tailored and really focused, have knowledge-based articles that are really clear, do that internal audit where when you look at your core features, make sure when someone goes to Google and they type those things in, that that's intuitive and that's easy.

[00:12:59] Casey Hill: Most companies aren't doing that. Most companies aren't spot checking themselves and going and saying like, what happens when I type in my core feature plus my company name into Google and actually see what that result is? How good is that article? Is it clear? Is it easy to navigate? Because this is more and more how people are operating. And AI is only gonna make it so much more like that, right? Where people are just gonna be like, so used to being able to quickly get exactly what they want in that context.

[00:13:28] Casey Hill: The final thing I'll note is personal touch is incredibly valuable. And similarly to the bandwidth thing, I understand that certain organizations may have more or less capacity here, but a personal video or a phone call or any kind of like face that you can put to that relationship does have a profound impact during that first phase. Cause remember, this is not even about getting into results yet. This is just all about, how do I feel in terms of the accessibility of this company? Do I think this is going to be easy to learn? Can I see myself getting my team, adopting this? That's the head space during that first phase.

[00:14:02] Andrew Michael: There is a lot to unpack there. You went through quite a few different stages and I think there's some interesting aspects as well. Like I think one pain point you pushed on as well was the number of emails. You said three to four being the sweet spot. Most companies, doing more than 10. This typically happens because everybody wants to speak to the customer and then nobody's really aligning internally. I'd be keen maybe just on that first point though, like what are some ways you recommend teams think about coordinating internally to avoid this mess?

[00:14:34] Andrew Michael: Because I've seen it happen many, many times at many different startups and it's almost, it becomes this inevitable point in time with a company and then everyone says, Oh, let's put together a customer communication map and they always end up falling apart as well, I think at the end of it. So do you have any tips and advice for people looking to try and ensure that that communication is spot on and then they're not bombarding their customers?

[00:14:56] Casey Hill: Yeah, for sure. So I think the first thing is you have to have a consistent auditing schedule. So one of the major reasons this happens is because over time, more and more things keep getting added and people are only looking at these flows maybe once a year, right? If that. And if that in terms of bringing everyone into one room. So the first thing I think to start out with, if you haven't done anything yet, you need to create some sort of centralized doc where you know who is contacting the customer during those first two weeks. Like, start there. That's the initial thing. Make sure that all the departments record any kind of touch point, whether it's email, whether it's impromptu product oriented touch points, whether it's sales, whether it's marketing, get all of that layered in. That's step one.

[00:15:39] Casey Hill: But then what's gonna happen is that over time, people are gonna continue to test. They're gonna say, what if we split test this type of, you know, flow? What if we changed up this kind of thing? So that's where it's important to make sure that you set a schedule where you say, look, every quarter we're gonna get in here and we're gonna audit this and we're gonna make sure that we're on the same page. That's where you prevent getting a space of maybe six months where your activation rates are being greatly impacted. Your churn during that initial period is being greatly impacted because you have a bloated experience.

[00:16:10] Casey Hill: And I think people, I've been behind the hood of a lot of software over the last 10 years. And I think people would be amazed at how often that bloated experience exists, right? Sometimes people might go in and think, oh, like, this is just my software, it's pretty heavy. It is very, very common in our industry to have kind of a bloated, over-the-top heavy contact when you start in any kind of software tool. So I think that's where you have to start, is with an auditing process, make it cross department and make sure it's frequent.

[00:16:39] Andrew Michael: Yeah. I think the problem as well is like most time, teams using their own software, they'll typically be using it, like quite frequently. And I think these issues often pop up, is when you perhaps don't use your product for a month or two and then you log in and then you get bombarded with five or six different messages and notifications and pop-ups. And because these tools are not very great at figuring these things out, even though they claim to have different steps and stuff. There's always thinking, and someone comes and comes, oh my God, like, what are we doing to our customers? Like, we need to stop this. This is terrible.

[00:17:08] Andrew Michael: But as you said like having a regular touch point is a great way for teams to align and understand, okay, like this is an important part of the user experience. And it's important for us to be revisiting this and making sure that we continue to work on it, but that also at the same time, we're all aligned and we're not bombarding customers because yes, I think you can really ruin that first time experience and then put on those like blinders, where people just stop listening and they tune out and then they become ineffective. Nice.

[00:17:36] Andrew Michael: The other thing that I think was interesting, you mentioned being sort of that experience where people ignore these things now and they just start Googling and going through search docs for specific like feature company name. I wonder as well now, like I think there's definitely an opportunity and I'm waiting for the company that's going to do this if there's not already a hundred. One, that automatically allows you to use something like ChatGPT and ask questions about a product, and then it goes through and searches these databases. But what do you recommend teams do to identify some of these like, initial help articles they should be putting together or how to prioritize? Cause I think you could spend a year putting together these docs and then so.

[00:18:21] Casey Hill: Yeah, it's a great question. So I think that oftentimes companies are going to position around certain differentiable features. So as a starting point, that needs to be what you need to spot check. If you know that like, hey, we differentiate from our competitors because of these four core features, at a bare minimum, you need to go and see exactly what that looks like when you go to Google and you type and you search things in, right? So I think it starts with, again, I don't wanna be a broken record with the audit thing, but it starts with essentially just doing that check process.

[00:18:48] Casey Hill: The next thing is, bring in customers who have fresh eyes and just ask those folks, right? Ask them how they're going through, ask them what that experience is. I tend to, like some people, bring in like blind testing groups. I strongly prefer it to be, actual customers to like blind testers. Cause the actual customer has real intent to use the tool. So they understand, like what they're trying to accomplish and they'll give you much more valuable data and insight in my experience. So if you have a sales motion, that can be one way, just have your sales reps kind of bring up and ask them some of those questions during that initial process as they're going through, or obviously your CSMs can do the same thing.

[00:19:26] Casey Hill: So I would talk to customers and run an audit based on what you're positioning on. And so that would be like bringing marketing into the equation, like, what are we running ads about? What is our website core, like what is, our core differentiators on our website or specific LPs that we're promoting? I think that's kind of like stage one of unpacking that.

[00:19:46] Andrew Michael: And it's also the stage one sort of you mentioned at the very beginning being like, I'm making sure that that promise, that you're selling on the marketing side matches the value that the product delivers as well. So having those aligned and then having the docs as well aligned to that is really critical and important.

[00:20:03] Casey Hill: Yeah.

[00:20:04] Andrew Michael: Nice. So phase one activation makes a lot of sense. I think this is obviously a lot where you can have the biggest impact as well is, if you manage to activate more users, the compounds and in terms of the overall retention of your user base. What's the next stage then?

[00:20:21] Casey Hill: Yeah, so the next stage is impact, right? And this is, obviously, a supercritical. This is where people have to drive results from your platform, right? So this is a critical phase. There's a couple of major things I look at during this 30 to 180 day period. So the first thing is you wanna make sure that you set the right goals. A really good example is in my past company, Bonjoro, one of the things that really confused us is we saw all of these folks who were getting good open rates, but were churning. And we couldn't understand because in our head we're like, we're sending videos, they're getting good open rates, like why are these people churning?

[00:20:55] Casey Hill: When we dug in, what we found was that wasn't the right goal to be tracking, it was replies. The magic of Bonjoro happened when a customer replied and said, hey, thank you so much for sending me that personal video. You know, I'm excited to be here. I'm excited to test XYZ. When we flipped that lens to looking at the right metric, that was really powerful. So the first thing is make sure that as an organization, you might have an idea of what you think success, that metric looks like, make sure that's correct and that that's the right metric and dig into your data, look at the people that are churning, look at your customers that are the stickiest possible customers and stress test that piece.

[00:21:34] Casey Hill: The second part that's really important during this phase is if people are not receiving value from your software. There's, kind of, two core reasons. There's the optics reason and there's the realities reason. So an optics reason might mean they actually are receiving value, but you're not presenting that in the right way. So what I mean by that is we weren't email tool at ActiveCampaign, right? We help people send email, we have CRM. What we do is we send people a digest. We show those results. You added this many leads, you sent this many emails, you're in the top 1% of senders. We're constantly reminding people of the value that they're pulling from our software. So that's the optic side, right? Like during this phase, make sure that you're doing things to encourage folks to be reminded that I am getting value from this tool, I am getting value from this system. That's one side.

[00:22:24] Casey Hill: The other side is sometimes there's a mismatch between this kind of, like time to value curve when you bring people in. So if folks are struggling to get to, they're churning in that impact phase because they're just not getting to those results fast enough, you wanna start giving some thought to that time to value curve and how you can possibly address it. So some of this could be like fundamentals. This could be how do you price? Maybe you try to make your tool something where people can get in more easily, lower barrier of entry, but you have usage-based scaling as you go. That's one model, right? To, like reduce that barrier and to take consideration of that time to value curve.

[00:23:03] Casey Hill: Another thing that really started becoming popularized in 2022 is actually just kind of like a down sell motion. More and more companies started purposely downselling because they realized that time to value was a little bit longer and they wanted to bring more people in. There was super strong headwinds. You know, you had, in the software world, you had 2021 is this huge boom period. 2022 things come back down to earth. 2023 is kind of this weird mix up and down, but there's still pretty strong acquisition headwinds. So that's another way to kind of think about or approach that side of it, if you will.

[00:23:39] Casey Hill: Another component during this period is if people are not active, they're going to leave, right? Like that's just a basic thing. So make sure that you're studying that usage, those logins and that usage pattern, right? That monthly active user over weekly active user percentage. And there's a resource I can share with folks from David Sacks, who's a well-known venture capitalist, who did an amazing breakdown about how to think about MAU over WAU, right? How to think about that metric, what are good baselines, how to kind of calculate it.

[00:24:11] Casey Hill: But I think at a base level, you need to be monitoring that activity during that phase because if people don't log in, they're not gonna get impact. So that's an important metric. And I would recommend people to set up, like automated notifications internally. If you see that someone has been inactive for a certain amount of time, make sure that you have people getting pinged on your CSM team or internal team to reach out, right? Pick up the phone, call a person, see how you can help, see how you can support them during that period. I think that's super important. The final piece I'll kind of say on this, oh, sorry, Andrew, go ahead.

[00:24:44] Andrew Michael: Yeah, I was gonna say, is that not more of a vanity metric though at the end of the day, if going back to the first point that you made around really needing to understand what the value is that you're delivering and be able to measure that value and if people are achieving that value, why do they need to log into your product to use it? So in your case, you mentioned Bonjoro. Maybe I've set up an automation. I've set up a flow. I want to get replies. I'm getting the replies. I don't need to come to the tool. From your perspective, like what you're saying now is, I'm going to look inactive in the tool, but really I'm actually getting value from it because I'm continuously receiving these replies. Like I didn't maybe get this point exactly. Yeah.

[00:25:22] Casey Hill: It's a good question. I think for most software, there's a strong correlation between people logging in and between their results and their output. You're right that this might not apply to every single piece of software. Like maybe there's some people who can kind of set things up and it's running on autopilot, but I tend to find from my experience that the majority of tools that I have worked with over the last decade, it is important that people log in and their logging in is a proxy of their overall engagement in the platform to process and kind of be like going through those pieces.

[00:25:53] Casey Hill: So I would say that if you are a piece of software that you feel like does just someone can plug say a pixel in, they have something running on the backend and they're like seeing results and they can kind of set it and forget it, maybe you're excluded from that. But I would argue that's less than 5% of software. I would say that for 95% of software, login and activity within the platform is super critical, especially during that phase, where you're trying to drive those initial results. So I would say, especially during activation and an impact phase, that logging in would be critical.

[00:26:25] Andrew Michael: Yeah. Yeah, and that way, going back to, I think your second point is all like, how do you illustrate the value of products delivering in the case where it's, a sort of said and forget, that's when like email digest can make sense. Like this month we sent, you sent out 900 videos, you got 700 replies, whatever it is, is a great way to sort of still show the value, but not necessarily need them to come into the product.

[00:26:47] Andrew Michael: The other thing you mentioned as well was around the monthly active to weekly active user ratio. And I think this one also, for me, I think it really depends on the product itself and what the frequency of usage is of the product, because I think like what I found in the past as well as you can't really manufacture usage if it's not in the natural cadence to use the product or service, I think it's good to understand how often people would be taking the action for your product or service and like, for example, a, for a social media app, you're going to want them in every day.

[00:27:18] Andrew Michael: So you want to be looking at, like monthly to daily ratio. If it's a email sending platform, let's say I run, a month… a weekly newsletter, like once a week would be the cadence because I'm coming in once a week for that. And then… so I think the metric there is really trying to understand what the natural usage and the frequency is of the product and how do you go about measuring that then in the context of, as you mentioned, the weekly over monthly active users.

[00:27:44] Casey Hill: Yeah, for sure. So you might find that there's certain different baselines by industry, right? In one case, maybe a 40 percent ratio might be great, right? In another case, that ratio might be skewed because it's like a different usage pattern. I agree with that. How you get to that might be a combination of like having conversations with leaders and other folks in your industry and trying to understand, like, what does that look like? I think there's often an intuition or like a pulse check. Like you're saying, you're going to get a sense of tools that have the capacity to run more on autopilot versus require folks to be constantly engaging.

[00:28:17] Casey Hill: I think during the initial phases, again, during activation phase and during impact phase, the majority of tools are going to require some level of, like ramp in to get, even if you do, have set it and forget it. Like you need to get that initial stuff in. And once you get that initial stuff in, you also need to monitor the first couple iterations of it, right? Like let's say you run an email tool and you have flows that are going in. Well, you're gonna wanna not only set up the flows, but you're gonna wanna understand, how are those flows performing, going in, making modifications.

[00:28:47] Casey Hill: So again, I totally agree that like, in the case of ActiveCampaigns, interesting, cause it's a CRM tool and it's also an email tool. So for the CRM side, you'd imagine like sales reps are in there every day. They're doing their tasks, they're following up with leads. So that's gonna be very involved. Whereas on the email side, that might be a step back from that. I guess you need to get a baseline, but I would definitely say that finding inactive users who aren't doing the core behavior. So maybe a better way to kind of sharpen that pencil is what are the core behaviors that people need to do to get to that time to value? Have those been done?

[00:29:23] Casey Hill: If those haven't been done, then we need to find a way to, like engage with that person, hop on a call with that person, get that individual into a stage where they are receiving value before everything else. And that actually kind of dovetails into like the last item that I emphasize for the impact phase, which is, can you get them involved in your community? Can you run dynamic events like training events, webinars, whatever that are keeping that engagement piece strong? All of those I have found create more loyalty during that phase, during that 30 to 180 days

[00:29:55] Casey Hill: Like in the community, there's networking, they're meeting other people, they're becoming more emotionally involved with your product. And the training webinars are directly correlated to helping them drive results. So if they're like, I want to do X thing, and they hop on a webinar that shows them how to do that exact thing, that's moving them to actually getting results and getting impact faster. So those are some of the key pieces that I would have folks looking at during that impact phase.

[00:30:19] Andrew Michael: During that stage. Yeah. I think the community aspect as well, as you mentioned, it's also serves as an education component as well and unlocking new use cases, better ways to use the product or service. And I think there's no better way than learning from other fellow peers as well that are going through similar challenges and figuring things out along the way. Which is cool. And yeah, I think just like pushing back on the points a little bit as well as I think that, I think generally, they all make a lot of sense, but I think it goes back to the very first point that you made, which is critical is the only reason people come to you is because they had a certain problem and they're looking for you to solve that problem and that's the end value and making sure that you can measure that value is the most important critical component, I think, like, are you delivering it?

[00:31:01] Andrew Michael: I remember we debated as well, quite intensively at some points at Hotjar around this idea of engagement, like manufacturing it, like not trying to manufacture and get people into product. Like if they were getting value from us. And one of the things that at some point we were like, let's introduce a Slack integration, and then someone was like, yeah, but if we have Slack, then people aren't going to come into the product anymore and like, where this road you really care if they come into the product, if they're still receiving that value, they're getting the feedback that they needed, they're learning from their users, Hotjar is solving the problem. So I think it's also just sort of figuring, making sure that you don't compromise on the delivering value component just to manufacture activity, side of things.

[00:31:40] Casey Hill: Yeah, totally. And Hotjar is funny. I used Hotjar for Archon, for my gaming company that we talked about at the top of the show. And it's funny because my pattern of using it was, I plugged in the Pixel and I actually obsessively was going on every day and I was watching screen recordings because I was trying to understand how people were interacting. And so it's an interesting example, like a software that you might think would very much fall into the Set it and forget it. ‘Cause I could look at the heat map, I could get the aggregate top level statistics. But at the time I was actually obsessed with constantly going in and watching those recordings because that for me was helping me understand that user path where people were kind of like scrolling, hovering, all that type of bits.

[00:32:22] Casey Hill: But I definitely agree with your point that you're making is that you wanna understand that value point. And you also wanna make sure, as I was saying at the top, that it's the right value point. That kind of goes to, like setting the right goal in the Bonjoro example is, you wanna make sure that it's the right piece that you're trying to kind of move folks to, or they're naturally gravitating towards, you might say.

[00:32:42] Andrew Michael: Yeah, because I'm making an assumption though, but you ended up churning, I assume on churn because, on Hotjar because the project and the use case that you had at that time ended up ending and there was no need for the product to service anymore. That I think that's also, like that periodic churn is something we saw at Hotjar quite a bit, especially with smaller businesses where they don't know that frequency of usage and continuous like, iterations and launches where they're monitoring and updating changes.

[00:33:10] Casey Hill: Yeah, totally. Yeah. SMB world is always like that, right? Like if you serve SMBs, there's always going to be this just like companies naturally phasing out of business and you can do better or worse, right, on churn and obviously the baseline churn percentages are very different. You know, you can have sub 1% in enterprise and if you're at 3% in SMB, you're doing phenomenal. So like your baselines can be different, but there will be a certain amount. They'll be unavoidable, even if people are driving a ton of value just on the nature that you're SMB.

[00:33:38] Andrew Michael: Yeah, absolutely. I think [inaudible] highlighted that in one of the episodes we had early on in the show, sort of, how they measured churn was they said, okay, like we're not just going to arbitrarily say we're going to go from 3% to 1% because we serve SMBs. We will first understand what's within our control and what's outside of control. And like a business shutting down is not something that we're going to fix as a company, we're not going to go like, get some more money, keep going, or like educate them to run better businesses. That's not what we do.

[00:34:06] Andrew Michael: So the first step was really just seeing, okay, what are, what's within our control to control and what's not, and then, okay, now we understand what we can play with. So we never gonna get a hundred percent of churn solved or in SMBs, but at least the 65% or 70% that's within the control, that's what we should be focusing on. Loyalty. We passed 180 days. Yeah.

[00:34:29] Casey Hill: Yeah, yeah, yeah, for sure. So I think that one of the least talked about phases of churn is this 180 day plus. People have been with you for a while, they've likely seen some results. And now I think the onus on you is to figure out, how do you actually make that person loyal, right? And one way of this is just great results, right? Like before I talk about anything else, if someone's just getting phenomenal results, like obviously that's a huge component of this equation. But I think there's other things that you can specifically do that do matter a lot.

[00:35:01] Casey Hill: So one of the first pieces is actual relationship building. So relationship building means like, how are you rewarding that person for being in your circle, right? And there's a lot of different ways this potentially can look, but the idea is, are you sending them something at the holidays? Are you incorporating them into your roadmap or you're asking them about, hey, we're trying to bring in our VIPs, we're looking at doing this new thing, we want your feedback. Are you starting a customer advisory panel?

[00:35:28] Casey Hill: We actually just did this at ActiveCampaign recently and I love it, I think it's so powerful. Take your top customers and make them into a customer advisory board where they're being compensated and they're part of this overall like helping you build things in the right way because they have a huge wealth of knowledge from both being with you for a long time and potentially also being like agencies or folks that serve a lot of your customers. I've found that these folks that are part of our customer advisory board are like a huge wealth of knowledge. I think that's huge.

[00:35:59] Casey Hill: Jason Lemkin, who's a person I really respect in industry, talks a lot about meeting folks in person. Again, I understand that's not possible for every business type, but as much as you can meet people in person, or even do goodwill calls. I'm a huge fan of goodwill calls, which is, reach out to folks with no specific agenda other than to check in, see how things are going, see how you can help them. Oftentimes when you call someone up and you have that no agenda call, it'll lead to that person becoming stickier because you're actually gonna end up solving problems or telling them about new features.

[00:36:32] Casey Hill: One thing that's really important here is the way that people use software, is often they come in for a certain application, they're likely only using a fraction of your overall platform. And I hear this all the time from folks. Oh, I didn't even know you guys could do that. Oh, that's crazy. I didn't even know that that was inside the system because you're constantly launching new things in software, but your customers came in to do one thing. So you might have them, like focused over here doing a basic newsletter and they don't even know all of that other capacity that you have.

[00:37:00] Casey Hill: Another thing that's important is once someone started to see results, I'm a strong advocate of trying to move that person onto an annual account. And I've done a lot of playing around with the best ways to move people. I found that Patrick Campbell's model has worked best for me and my clients. He recommends to reach out at month two and month 10 and have a specific email where you put the exact amount that the person is gonna save. So you don't just say, save thousands with an annual plan. You don't have some generic, you actually use a merge field and you say, you could be saving $1,312 a year on an annual plan. That is the subject line of your message. And you position that a month two and month 10 during this overall journey.

[00:37:40] Casey Hill: I feel that that tends to work really well and has led a lot of brands that have adopted that to get a much larger pool of people on annual accounts. And I've done that with many organizations before and seen that hike up annual accounts by as much as 5% to 10%. So definitely encourage people that don't have a concerted focus after the point of sale because most folks are, like defaulting to pushing annuals upfront, that's great, continue to do that, but also have those touch points via email that are highly personalized to their account going through. If that person's happy, you're locking that individual in for another 12 months. And if they potentially have issues, you have more time and bandwidth to actually deal with it.

[00:38:19] Casey Hill: Obviously putting someone on an annual account doesn't get ready to churn. Sometimes it can be a mask for churn, but it does give you more time to solve problems. It does give you more time to, you know, not lose someone because of a specific emergent event, like a bug or downtime, et cetera. So those are some of the major pieces I'm thinking about at this stage, which is how can you build relationships? How can you meet these folks? How can you incorporate them into the future of where you're going? How can you get them onto annual plans? I think all of those pieces will help impact that loyalty stage of Churn.

[00:38:50] Andrew Michael: Yeah. And also the point you mentioned around like transitioning use cases and introducing them to other features and parts of the product they may not even be aware of. Cause I think when somebody starts with your product or service, they normally come in with a specific pain point or problem in the beginning and their sophistication evolves over time, their needs evolve. And if your product can solve some of those needs, it's always a great way to introduce a new actions for them to take at that point. And yeah, absolutely. Although yearly can mask churn, it also is a big way, as you say, it buys you time to solve the issues and to work on it. So it is a big lever from there.

[00:39:29] Andrew Michael: I’ve seen, at Hotjar, we saw a huge inflection point when we introduced the yearly plans as well from that side. But I've also spoken to other CEOs on the show who sort of said, we actually removed our yearly plan because we felt we weren't learning fast enough in terms of churn and retention. So it's definitely good for business in the short term, but if churn is a big issue for you, perhaps it's not good to mask it and figure it out sooner than later. But yeah, it's an interesting one.

[00:39:56] Casey Hill: Yeah, it's, it kind of goes into this leading versus lagging indicators bucket, right? Like when you look at leading versus lagging indicators, and I know we were kind of having some back and forth, but activity can again be one of those proxies where if someone's on an annual plan, but you see long pockets of them being inactive, that's often a strong leading indicator that that individual is going to churn and so when you're looking at churn, you look at things like those usage rates, you look at things, like NPS and CSAT, and like many of these are flawed, right?

[00:40:24] Casey Hill: So we could have a whole episode on why some of these core leading indicators are flawed, but in aggregate, they do tend to paint a good picture. If your CSAT is low and your NPS is struggling and you have folks that are relatively inactive, that's a pretty dang good sign that you're gonna lose that customer. So I think that sometimes what I find is that blending leading indicators, not having like, if you just focus on, I'm just gonna look at activity. You might miss the mark because of, you know, things we talked about in this episode.

[00:40:51] Casey Hill: And it's, same thing as if you just look at NPS, oftentimes that gets messy and there's admin NPS versus user NPS, there's a lot of nuance to that. But if you look at like those three metrics blended together that can definitely be helpful.

[00:41:03] Andrew Michael: Yeah. And yeah, we've definitely talked about the nuances of these metrics and the challenges and the problems with them, but I like how you frame it. Sort of the blended mix, you'll be able to get at the direction of, are you going there, that right direction or not? And I see we're almost running up on time. So I want to make sure I ask a question I ask every guest. What's one thing that you know today about churn or retention that you wish in you when you got started with your career?

[00:41:26] Casey Hill: Yeah, that's a great question. I mean, I think that the biggest thing that I've changed with churn is that in the beginning of my career, I think I just looked at churn as an aggregate. I looked at it as an aggregate number. And we've talked about one way to splice it, which is by phase. There's also splicing it by cause. There's also splicing it by cohort. I think I had no idea the levels of nuance there and how critical that was until I started working with more brands, until I started kind of digging in and seeing, hey, this SMB cohort is totally different from this enterprise cohort. This ecommerce cohort is totally different from the SaaS cohort. And understanding that if you really wanna drive actionable results, you have to get into that specificity. The actionable components are in the specificity.

[0042:10] Casey Hill: I think averages hide the insights was a quote from Intercom CEO that I heard at Sassler. And I remember that stuck with me because I absolutely believe that's true, right? Like you could have an average rate that is pretty good that's being pulled up by one of your good cohorts or is being pulled down by one of your bad cohorts. And if you just look at it together, I think you're gonna miss the mark. So I would say that would be one of the biggest changes is, more cohort oriented lens to churn.

[00:42:38] Andrew Michael: Yeah, I love that. I'm definitely going to keep using that in the future. I love these little quotes on data. The one I love as well is sort of if you torture the data enough, it'll confess to anything. And this is definitely like what you mentioned, averages hide the insights. I'm going to be using them in the future. Nice. Casey, so today we talked about the different phases, as you mentioned, the different ways in which you can focus on reducing churn at these stages and engaging customers. Is there any sort of final thoughts you wanna leave the listeners with, anything they should be aware of, or how can they keep up to speed with your work?

[00:43:16] Casey Hill: Yeah, for sure. So I guess the biggest thing I would say to kind of wrap everything together, you kind of heard me talk about in a couple of different instances, but if you're gonna start in on any of this, like start doing a couple audits and a couple of checks, start seeing how many touch points you are, start seeing what are customers searching like, do the groundwork to inform a lot of the other pieces. That would be my one recommendation if you were to pull one thing away from the show is get some of that core insight you're gonna use for the rest of this. I talk about SaaS, churn, organic growth, a lot on LinkedIn.

[00:43:47] Casey Hill: So if you're interested in learning more about kind of firsthand experiences in that world, just Casey Hill on LinkedIn, you can find me and you'll find a lot of articles where I'm breaking churn down by phase or breaking churn down by cause and so happy to have help folks that have questions in those worlds. So I would say follow me on LinkedIn. And if you ever want to reach out, if you have questions on kind of your CRM or ESP side, feel free to reach out to me, chill, C-H-I-L-L at and happy to answer questions there as well.

[00:44:17] Andrew Michael: That's a really nice shortening of the name as well there. Casey Hill. It's a good one.

[00:44:24] Casey Hill: Yeah. Very cool.

[00:44:25] Andrew Michael: Well, yes, for the listeners, we'll make sure to leave everything mentioned today in the show notes so you can keep up to speed and you can catch those there. And again, yeah, thanks so much for joining, Casey. I wish you best of luck now in this new space that you find yourself at ActiveCampaign.

[00:44:38] Casey Hill: Yeah, grateful to be here. Thanks, Andrew.

[00:44:47] Andrew Michael: And that's a wrap for the show today with me, Andrew Michael. I really hope you enjoyed it and you were able to pull out something valuable for your business. To keep up to date with and be notified about new episodes, blog posts and more, subscribe to our mailing list by visiting Also don't forget to subscribe to our show on iTunes, Google Play or wherever you listen to your podcasts. If you have any feedback, good or bad, I would love to hear from you. And you can provide your blunt, direct feedback by sending it to Lastly, but most importantly, if you enjoyed this episode, please share it and leave a review, as it really helps get the word out and grow the community. Thanks again for listening. See you again next week.


Casey Hill
Casey Hill

The show

My name is Andrew Michael and I started CHURN.FM, as I was tired of hearing stories about some magical silver bullet that solved churn for company X.

In this podcast, you will hear from founders and subscription economy pros working in product, marketing, customer success, support, and operations roles across different stages of company growth, who are taking a systematic approach to increase retention and engagement within their organizations.


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