The systematic approach Usersnap took to increase customer retention
Today on the show we have Luka Kankaras, a Product Specialist at Usersnap
In this episode, Luka shares an overview of the framework Usersnap used to increase retention. How they collected feedback to diagnose their challenges and prioritized what to tackle first.
We then discussed how Usersnap reduced churn by expanding the use cases of their product and we wrapped up by discussing how the team used OKRs to align and focus their attention on churn.
[00:01:23] Andrew Michael: hey, Lu. Welcome to the show.
[00:01:26] Luka Kankaras: Hi, Andrew, it's nice to have you
[00:01:28] Andrew Michael: to have me or for me to have you, but, uh, it's great to
Uh, for the listeners, Luca is a product specialist at user snap, a customer feedback platform for SaaS businesses, Luca, and the user snap team have recently made a significant increase in customer attention. And Luca's here today to share their approach. The team adopted that led to the success outcome prior to user snap.
Luca was a marketing and sales manager at log. And there's also now a co-founder of a startup in stealth. So my first question for you look is what does your new startup do? [00:02:00]
[00:02:01] Luka Kankaras: All right. thanks. That that's a tricky question. So what, um, what does startup do is called Passal and it's a global membership. Uh, for all the remote workers who, you know, prefer working from restaurants, from coffee shops or ho or hotels.
So what we do is that we give them one membership that allows 'em to, you know, enjoy discounts and access, networking events, and basically their favorite places across the world.
[00:02:29] Andrew Michael: Okay. Very interesting. And you've just got started now with it. You just launched it apparent because on LinkedIn, it wasn't stealth.
And that's why I was wondering if you can answer that question or not, but, uh, so it's out, you're starting to push
[00:02:40] Luka Kankaras: it. Yes, exactly. So we launched thep we collect, we already introduced it to a few restaurants and now we'll do that until September. And from September we'll focus on bringing.
[00:02:54] Andrew Michael: Very cool. Are you focusing any specific demographics and territories first?
Uh, what's the [00:03:00] yes. Go to market.
[00:03:00] Luka Kankaras: Yeah. So mm-hmm so, because we are based in Europe, uh, we'll focus on the dock region first. Okay. And for like, mainly like we'll focus on Austria and Germany and from there we'll move. Hopefully we'll move to the.
[00:03:16] Andrew Michael: Okay. Very nice. Well, I wish you best of luck, uh, with that now.
And, um, this new startup journey that you've started. The thing today we're gonna chat about is a little bit about user snap and what the team has bringing there. Can you just give us a quick, like overview of what user snap is and what the company
[00:03:31] Luka Kankaras: does? Yeah, of course. So user snap is a customer feedback platform that allows you, that allows companies to kind of collect feedback within the whole product development lifecycle.
So our kind vision is to help companies build products that, that actually bring value to their users and to avoid pillars. So we do have the feedback, uh, widget that they install on the website and they, they allow their users basically to share [00:04:00] their feedback. Uh, whenever they want to.
[00:04:03] Andrew Michael: Cool. And we had this discussion as well before the, your team reached out as well.
You've had some really good increases in customer attention lately. Um, you had an approach like maybe let's get started. Can you just give like a high level overview of, uh, what the team has been working on and what you've been doing to try and increase, uh, retention?
[00:04:22] Luka Kankaras: Yeah, of course. So for us, basically, it all started back in 2020.
Um, I mean, I joined also the company around that. And we saw that our monthly churn rate was around, uh, it was around 7%, but then over time, uh, when we wanted to improve something on it, uh, we, we kind of realized that we have no clue on what to do because we did not know what, you know, our users say to us why they leave, et cetera.
And that's when we thought about this whole strategy. Uh, and that's when we introduced a strategy, uh, that that's called ki AA SK. So the first [00:05:00] thing is that what we did is that we improved the whole ask part in the term, uh, process. Then after that we did, we did act on the feedback. And of course, um, after that is all about the prevention.
So if you want, we can also go through each stages. Of that right away. That's
[00:05:22] Andrew Michael: yeah, let's do that. It's quite a ironic though, as well for a feedback company, not to know the reasons for churn all, but it's good that you realize that and started implementing that into, so, yeah. So let's talk through the first phase you mentioned is like ask and I'm assuming that's just really trying to understand and diagnose problem.
Like how did you go about them figuring this out? What was the steps that you did to.
[00:05:44] Luka Kankaras: Yeah. So for us, uh, we basically did it in two ways. Uh, one and the first one was about asking the customers for the churn reasons, uh, during the churn process. So for example, you know, if you have your premium LinkedIn account, [00:06:00] uh, or I would say most us tools now as well.
Uh, so when you wanna cancel your and disable your account, they show you a popup as important reason why, why you are. and we did not have this in place before that. And once you introduced it, it really helped us a lot because we could also base on that follow up with the users, depending on the reason they select.
And the second way we did ask for feedback was by scheduling interviews with churn customers to find out these reasons. Um, the thing with this tab is you really, and what we, what show us kind of the most success was that we, you really need to play with the templates, email templates that you use to invite them for an interview.
Uh, I think we experimented with a few of them, like five or six of them until we found, uh, the best, uh, the best template to use.
[00:06:51] Andrew Michael: Cool. So let's go back, uh, starting as well, first of with the churn exit survey. So I think even this is something like you said, it's very, very common. [00:07:00] I even see now, like Stripe has this built into their subscriptions and billing set up, so you can start ask, but initially, how did you go about the survey itself?
Was it open ended or do you have specific fields to select, what did your survey look like?
[00:07:16] Luka Kankaras: Mm-hmm yeah, so. When it comes to the, to the survey, it was kind, uh, dropped down with six options. And then, uh, what we like the last option was of course other, where they could provide an open answer. And what we did over time is that when we saw that, for example, they never selected one of the categories.
We just removed that and then leave them kinda less. Because the last choice they have, uh, you know, the more kinda likely is that they will select one of the. and then based on the category they sent, uh, based on the, kind of the churn reason they select, we ask them like, why, why they, uh, decided, you know, uh, for [00:08:00] example, like exactly like difficult to use, what exactly was difficult to use.
[00:08:04] Andrew Michael: Cool. And from that, like, what were you then trying to understand? So you implemented this churn server. You have, uh, let's say like call it two, 300 sponsors now. Uh, what steps did you take from.
[00:08:17] Luka Kankaras: Yeah. So from there, uh, once we had kind one, once we identified the trend on why they're churn, you know, for example, if it's too expensive or not, uh, the second thing was to kinda act and to form all our team members, all our colleagues.
About kind the pain points, uh, you know, and, and that kind of driving force behind our customers turning. So that was the next step kind of presenting all the insights to the team. Um, we do have, uh, with every department, we do have like monthly check-ins where we present all the insights that we collected.
And I, I cannot kind of thank enough to the whole thing, kind of to be open, uh, when it comes to [00:09:00] acting, uh, on these insight. Uh, and because I think this was kind of the crucial step, uh, in addressing this session after, of course after this part, uh, we kinda, the short path success and try to reduce the churn, uh, to try to find those low hanging fruits.
So we kind of just offered incentives depending on the churn reason. So if they select, you know, too expensive, we would show down popup saying, you know, here is like 50% discount in case you decide to stay with us. Mm-hmm if they select, you know, we couldn't get a team by end, we say, okay, do you need more time?
Do you need, you know, we can organize a training for you and your colleagues to get started. So like every single popup was really personalized, uh, to that turning.
[00:09:44] Andrew Michael: Yeah. It's interesting. So you started then like with, for churn deflection, which is like the first sort of thing that you tried to focus on as opposed to, uh, going to the root cause.
The, the other thing is interesting. You mentioned that as well, like offering a discount when people go to churn for it's too expensive [00:10:00] for the reason is like the. This is one of the things that I'm still asking the jury about and trying to figure out, does it actually work or does it end up hurting the business in the long run?
Uh, cause I actually recently saw was quite funny. Uh, it was a slack group, like sauce do founders or whatever. Somebody posted in there. There were, uh, something along the lines like, Hey guys, if anybody wants a discount. Just go to cancel your subscription. I think it was on zoom. Zoom gives you a 50% discount and everyone's like, haha, I do that as well.
And there's like this whole long common thread to people actually mentioning this and they're like, oh, and by the way, this company does it, this company does this company does it. So I wonder like, does it end up hurting yourself more than actually deferring churn at the end of the day? Cause on the other end of it as well, which is quite funny is that like.
You might have set up this campaign and you're going back to the team. You're like, oh, wow. Look, we just like managed to deflect so much churn, but naturality, what you ended up doing was giving discounts to users. So mm-hmm, , it's very difficult to measure this and to really understand the extent of, [00:11:00] to which it's happening.
But I just found it really ironic. Cuz I previous episode we're discussing this topic and that same week I noticed this like up in a group, what are your thoughts on it? Like how did you have any debate or discussion around it?
[00:11:13] Luka Kankaras: So my thoughts, I mean, it's so nice to mention this. So on the short term, uh, I, if you look at a short term, uh, kinda if we do the discounts, I think it cannot hurt us that much, but, uh, if we do not do anything on the feedback we collected, but just continue to, you know, to use the discounts.
It's like the most, uh, most expensive, more expensive churn. I think that kinda, that will, uh, yeah, that will kind have nothing but the negative effect on the business because what's also our idea behind it is, you know, by understanding their churn reasons. This will all give us feedback. Eventually that we improve our pricing, that we improve our product to add features they use, and then to create a pricing base really on the value they.
[00:12:00] And by doing that, we want to, remove this step of operating discounts.
[00:12:04] Andrew Michael: You mentioned as well then.
[00:12:06] Luka Kankaras: Sorry. No, no, I hopefully have zero churn. Yeah.
[00:12:10] Andrew Michael: Yeah. Uh, the holy grail net negative as we need to get. So the, the thing you mentioned as well then is you had like a monthly update or did I get that right?
Where you would share the insights, uh, from it? Like what did that format look like? How did that go? Um,
[00:12:27] Luka Kankaras: mm-hmm . Yeah, sure. So when it comes to the monthly, uh, updates, our customer success team, uh, share, I mean, this is like in general, they share the insights they collected with other departments, you know, including, uh, the growth team, the product team and development team.
So we have that sort of also creative seed, uh, that we put into every meeting. Where we share, you know, some new insights that we, or let's say some suggestions that we kinda came up with based on the feedback we collected. Yeah. So the great, the [00:13:00] great, uh, kind outcome, uh, was that, you know, other than kind, having people, uh, providing construction feedback, uh, kind challenging, what we came up with, uh, we really got some cool features out of it.
So what we did is that we, uh, we hired 24 7, uh, support. Uh, just because we work, you know, we are from Austria. So we work, uh, in the central time zone and most of our customers are from the us mm-hmm . So, you know, this was one of the feedback they gave us. Like, you know, you are not there where we need help.
And that's when we decided to open a 24 7, uh, customer support also, uh, we changed our pricing, uh, the pricing model based on their feedback. And it's interesting that each one of these ideas came kind of from different.
[00:13:49] Andrew Michael: Nice. Yeah. During these meetings. Yeah. I think one of those things with churn and pricing is that like, you always wanna have a certain percentage.
I'm not sure what the feedback was there, but to definitely have like a good [00:14:00] percentage of people complaining that pricing is too expensive. Uh, because if nobody complains, then your prices are too cheap on the opposite. End fact. Uh, it's interesting. We did something similar as well. I think at hot show, obviously we had.
Churn exit survey and we're using it for quite a while. But when COVID hit was when we really started to try and get things together, we put together like a churn dashboard and we were using, uh, Tableau at the time. Uh, so then we could actually model out, uh, the survey responses and how they changed over time.
On a month to month basis, what the reasons were, and like you say, similar to, we were using NPS in the fashion, we were collecting NPS with the team and then sharing like some of the protractors and contractors, we would do the same thing then for like reasons for churn and how things were changing over time.
Uh, I think this is really interesting as well, like to get a baseline for, because this is something that came up with an episode with Erno from a lower pulse where they also used these churn next surveys as a measure of what churn they could actually [00:15:00] fix when they were setting targets for how much they wanted to reduce by.
Because like for small businesses, for example, going outta business is not something that you're gonna stop, uh, yourself as user snap. That's like outside of your control. So trying to. Incorporate that in the goal that you set to reduce is no use. So if you understand what, like the true churn is, that's, uh, avoidable versus unavoidable, it allows you to get a go clarity, like what you can actually do to improve the metric and the goals that you set for your team.
Um, exactly. I like that. The next thing you mentioned, then you did some news interviews and you experimented some templates. Like what sort of volume are we talking about? How many interviews you conduct? Is this something you still do today? .
[00:15:44] Luka Kankaras: Yeah, so the interviews we still do today, however, uh, I mean, we operate based on the different OKRs, right?
And then in the, into each OTR, we have certain key that we wanna focus on. And for example, in this quarter, uh, [00:16:00] churn topic is not one of the topics that we wanna handle. And that's why we do not give you that much priority. Having in mind that we are not, you know, a big company, we are 90, 20 people, actually not 20 people start.
Um, we kind just put this whole project on hold, but in general, we are, you know, conducting the training interviews. Uh, I would say yeah, regularly when it comes to the amount of call I think we did around, uh, 20 or 30 interviews eventually. Mm. And, you know, and it's really like, it's really good. And that was also surprising to me because I always expected to kinda, you know, when we have the training, uh, the interview that you expect that people are kind angry or, you know, they're frustrated about something, but in general, most of the times they were kind of really super friendly to share their feedback and to give you suggestions on want to.
And also, uh, majority of these [00:17:00] interviews were just about that their kind of project ended and that they allowed the tool and then they just give you a few suggestions for the future. So that's why I'm super positive about that.
[00:17:08] Andrew Michael: Yeah. I think the challenge, especially with churn exit interviews is like the survivorship bias of those that actually agree to do it first.
Those that don't and, uh, what you're gonna be getting then, uh, because perhaps like the really pissed off people are too pissed off to even give a shit about speaking to you. So, uh, but yeah, I think. Uh, doing them, those stuff, you can learn a lot in that. And for example, as you mentioned now, like the project has ended, I think that's definitely, uh, something you'd maybe see as one of your use cases on a specific persona.
Uh, we actually certainly saw it at hot chart, uh, where you'd have a lot of agencies that were using the product and you had this periodic churn, uh, where they would do a project churn, come back, do a project churn, come back and it ended up having like an impact you could see on like the react. Metrics itself and on activation.[00:18:00]
So, um, it ended up being like a total net positive because it wasn't like really the customers actually churning. Um, I'm not sure what they've done to try and figure that out now, nowadays, but I think there's definitely a lot of companies, this opportunity of figuring out this project based flow and subscription model.
So, yeah, you've
[00:18:21] Luka Kankaras: connected one point to add here. Yeah. And one point, to add here, uh, sorry. Just my dog is barking. No worries. Uh, yeah, working from home is terrible. Uh, and sometimes because of the dog, what I wanted to point out was that for example, What we did based on this feedback.
I mean, we started as a buck tracking solution in the past and the majority, or kind of the churn reasons was about the kind of, you know, their project ended and one, and that's why we also realized, uh, that we need to access also another area. And that's when we shipped [00:19:00] it towards the customer experience, because we wanted to make our products.
You know, now when it comes to the churn reasons, now we have other churn reasons. Like, you know, the project ended is not anymore. Like the number one. Yeah. Because now if we have more departments using our software, that means that, you know, uh, the product will become, they will not drop, uh, drop out, you know, as soon as their project end.
So that was really also a learning
[00:19:27] Andrew Michael: lesson. well, so it sounds like as well, then you used like expanding the number of use cases for the product as, uh, exactly as a weight to increase engagement for the tool. And then, uh, what else did you try then? So you, you said, okay. Like this was a concert, like concerted effort across the board with the team.
Uh, you did initial research. You then started the low hanging fruit, like churn, deflection, you introduced and encouraged new use cases. Uh, what else did the team do, uh, that you felt was really, really effective?
[00:19:56] Luka Kankaras: So the other thing that we like two more things that we did based on the [00:20:00] feedback one is that we improved the whole user onboarding experience.
And so we had difficulties kind of bringing people to the value as fast as possible. Yeah. And that's also what we noticed, you know, if you even subscribe to the, to, for them, to our product. You subscribe, but that does not mean that kind of, you know, your onboarding has stopped. You saw that many companies are kind of thinking of the onboarding as something, you know, as soon as the user signs up until the moment they purchase, but like that's covering just one part of it, you know, after they purchase that still does not mean that they are fully onboarded.
So what we did is that we improved kind of the activation metric. Um, we focused more on the retention. And in general, when people can experience the value out of it. And also on the other side, we improve the whole email flows, uh, and like conversational and product bumpers. And we kind of created more [00:21:00] educational content, uh, for all our users to, in order to make them more successful.
[00:21:04] Andrew Michael: Yeah. The, the email flows is an interesting one. Like how effective did you find. And did, did you measure the impact and performance of the time?
[00:21:16] Luka Kankaras: So when it comes to the emails, uh, I must say that product bumpers at the right time at right triggers, uh, are more kind of useful. Then the email flows, the email flows on average, uh, only like the welcoming email it has like about like 50, 60% operate.
All other emails here have around 30% open rate. And like we saw them as successful. Uh, but really they did not drive, you know, that many, uh, I mean, when we look at the results, when you look at the, you know, kinda. Click, you know, link, click links, and so on that it not improved [00:22:00] drastically, but it, I mean, but it improved.
If you look at a previous
[00:22:03] Andrew Michael: date, so you were doing sort of like event based messaging three email, right? So if someone took an action, you to, if they didn't take an action, you send a message. Yeah. Um, this one as well, like I wanna hear some from some of the listeners. Well, so if you're listening, you have any great stories to talk about.
Used user onboarding effectively. And specifically email is because actually funny enough, like at hot chart, at some point we originally launched with an onboarding sequence and then it didn't change for like the first two years, nothing changed. And, um, then at some point somebody accidentally switched off all emails, uh, and they weren't running for like three months.
But the funny thing is like we saw absolutely no change in metrics like whatsoever. There was like, no. Easy way to see like any sort of correlation or causation in anything, uh, in the data. Uh, and that got me sort of thinking was like, okay, we spend so much time to try and get these email sequences together and to work.[00:23:00]
Um, Do the action work or is like people that are gonna take the actions are gonna take the actions anyway. And there's just very, very small percentages that end up changing their behavior because they receive an email from a company. Um, but I'd love to hear like as well from other, listen, if you have yourself as well, some stories to share on this, um, because definitely, uh, like practically.
It makes sense in my mind. And it's like, okay. Yes. It's logical that if people don't take actions, we'll send them a message to prompt them. Uh, we can use other channels as well. So like, one of the things we wanted to explore with was like retargeting ads on Facebook. So somebody is like credit an account and they've gone through a couple of actions.
Like you can actually use ads to reach them in different channels and, uh, try driver activation. But. I'm just not sure, like if anyone has had really good success stories. Cause it really caught me is like, when I noticed that we we'd switched off everything, nothing changed. And it was like, okay, like, uh, can we actually improve this by making changes?
Because there was something then there was nothing. And if we add something again, what is gonna be the difference, but yeah. Keen to hear your thoughts, like, uh, yeah, [00:24:00]
[00:24:00] Luka Kankaras: I can, I can add one thought here. What, what we really thought that made a difference was the sales. So we are kind of following the, you know, product led go to market strategy.
And as a part of it, we did, uh, the pro led sales. So in the past, we kind of really played a lot with the outreach campaigns, you know, like reaching out to call leads cetera. But at, you know, at that point we realized, okay, but we have so many leads coming to us. Why don't we focus? You know, Fully, uh, on the inbound, uh, sales.
And when we introduce the emails, uh, you know, to kind of most active trial users, etc. That really brought us, uh, also conversions and demos and the numbers went up drastically. So I would say if I can, you know, from the whole email flows that we did in the past, uh, I would say this one was really measurable and it brought us the most success.
Yeah. Reaching out to the most active users and offering [00:25:00] help. To
[00:25:00] Andrew Michael: book for leads and stuff. Yeah. I think that makes sense as well, to large degree, because then you, it's more of like a customer success initiative or even sales, like trying to close deals and really trying to give more of a handheld white glove experience.
And I think that definitely makes my doubt in that, uh, being, but again, I think there's survivorship bias in that is that the people that. Going to agree to it already, the people that are pretty happy with the product and wanna learn more about it or wanna get a better experience. So mm-hmm, , um, it's for me as well.
There's something I wanna like explore a little more with the show and speak to a few people. Who've actually seen really good success in the space.
Cause I look at my own metrics as well. And when I look at sort of like, we use Intercom, we set up specific goals and, uh, we see like the conversion rates. But if you do like split tests, you can see pretty much like the same percentage of goals achieved with the cohorts that get the emails versus those that don't.
And it's, it's negligible the difference, but, uh, yeah. [00:26:00]
[00:26:00] Luka Kankaras: And, and the thing here is that with these calls, when you are approaching your customers from that kind of customer success point of view, and not from the sales, uh, shoes, the thing is that, you know, they'll and you do this regular check-ins with them.
They'll be more willing to share with you, you know, um, the, let's say the negative feedback I have, you know, you'll see where, when the kind of red lights turn. Yeah. Uh, they'll be more open about speaking about their issues, et cetera. So this is all something that I think is the most valuable when it comes to these regular
[00:26:33] Andrew Michael: check-ins for sure.
Like, I think with the, the check-ins and stuff, one of the things I like was app flyers approach, the P she is they set their customer success targets to actually increase engagement. Their product. So what they would do is they would, before calls, they would see the clients, they would see which features they'd use, what they'd activated.
And then they would just like on the calls, try and encourage them to use the new [00:27:00] features or to increase engagement with those. So, Using like the one to one conversations is sort of an adoption flow and an event based adoption flow. If you wanna call it that to try and increase, uh, actions and they find really good success in that in helping increase engagement all around.
The other thing that you mentioned was around the feedback. I think that's an, an excellent place to get feedback. And one of the great. Places as well as like just post renewal. So if you have a customer that's just recently renewed, um, there's a big motivation then for them to be actually giving you feedback and just asking question like, uh, what nearly stopped you from renewing today?
Uh, on that call, I think can be a really powerful, uh, tool and way to collect some good quality feedback because. The users now have been committed to whatever the next mentor period is already. Um, and they wanna make sure the success of the product because it's, uh, going to deliver them value at the end of the day.
So probably that's more effective collecting feedback from those people cuz you hitting well, your, your [00:28:00] customer profile because they've stuck around, they haven't churn. Uh, and they're motivated to give you the feedback as opposed to like somebody who's not been satisfied with your product they've churned.
They could. A bad fit customer to begin with, but then collecting those, like that feedback from those exit surveys can give you mixed signals as well, and which refocusing your energy.
[00:28:20] Luka Kankaras: Exactly. And if people are, you know, now if I ask, okay, Andrew, that sounds great. I wanna quite feedback from the, you know, reactivated users, but how, if they're not responding to any popups or any emails, like I cannot dress enough.
How important? I think the email copy should be. And how, like you need to, from the subject line to the first sentence, I think the number one goal should be about showing them that you not a robot, you know, that you not a bot that is sending automatically these emails. Uh, so that's why paying attention, those details.
Uh, I think that it can really increase the feedback rate. They will get.
[00:28:59] Andrew Michael: Tell us [00:29:00] about those emails. Like what was, uh, one of your biggest learnings in how to get more people to, to attend.
[00:29:06] Luka Kankaras: So the first thing was what I just mentioned, uh, for us the subject line, uh, he has to have some kinda, you know, he has to be intrigued.
So what we put usually is just like a question or we put like feedback at. The name of the company, et cetera. So something that would just have then click on it. And then in the first sentence, we always put the personalization, but not personalization by, you know, just stating their, uh, email company role, whatever, but rather, you know, oh, I just, uh, opened my laptop and, you know, Saw your name, uh, in the user base, whatever, but something like that's really related to the actual, why you send them, uh, an email at the first place.
And after that, what we saw the best, uh, when it comes to booking interviews was offering a voucher. And stating that the call would be researched only. So it's [00:30:00] not, you know, there's no trips, uh, basically, so it's a research only it'll take, I don't know, 30 minutes we really want from you this, this and that.
No preparation needed nothing and you'll get an Amazon voucher. So it was really quite, quite, uh, straightforward and yeah, and that, like, if you want, I can also send you the template we used for.
[00:30:22] Andrew Michael: Yeah, that'd be good. We can add that as notes as well later for the listeners. I think that's interesting. Yeah.
So definitely like having really good strong copy with emails is important and. Interesting that you use Amazon vouchers as well. I think, unfortunately at this stage you need to sort of offer a carrot to get people, to, to join along and come in and give up their time as well. Yeah.
[00:30:45] Luka Kankaras: Um, we did, we did a surveil LinkedIn on that.
Like what, what is the, uh, you know, what's the reason when you decide, why do you decide basically to participate in a research call mm-hmm and the majority of them? So the first two options were the first [00:31:00] one was about because of the voucher, monetization reward. And the second was because, uh, they wanna shape the product.
They wanna kind of leave that trace. Yeah.
[00:31:12] Andrew Michael: Nice. Um, so all of this as well, there must have been like strong alignment within the organization. Like how did you bring everybody together? Because making all these changes across the board and companies like it needs to be coming, I think from the top down.
And, uh, what was sort of like the process like that internally. So you collect all those feedback. You have these insights, like, but actioning them is not always straightforward. Uh, how did that go?
[00:31:37] Luka Kankaras: Yeah. So we, I mean, it's, it's great in our company that we have flat structure and we are all kinda open to feedback in that sense.
So there is no, you know, the strong leadership who makes all the decisions themselves. And then, you know, we are just there kind of to implement it, but rather, uh, everything should be based on the research and on the evidence. and [00:32:00] that's the main driving force in our case. So if, you know, if I say, okay, these 10 customers said that, you know, we need to improve, uh, you know, our pricing or I don't know, it's too expensive.
Uh, then the rest of the team will find, okay, do we have evidence for that? Yes, here it is. And then we start implementing it. You are the one responsible. And you are, you know, if it doesn't work, then you are the one, sorry, who is, you know, who has to bear with that, but yeah, on the other side. Yeah. All right.
You're also the one responsible
[00:32:34] Andrew Michael: for the benefits. Yeah. You mentioned. Okay. As well. Like, was this something that was part of an okay initiative to really, really the team around it? Um, or not was just sort of like really? Um,
[00:32:45] Luka Kankaras: yeah. Yeah, it was, it was so we had one OKR focused solely on the churn. and I was the driver for it.
Yeah. So that's why, that's why like this, I had to engage more with it, you know, with the project in [00:33:00] the past, it was more about whenever we mentioned the churn topic, we kind of just put it under the carpet and we avoid that topic at all. Yeah. But once, you know, I mean it's selfish, but I think we are all a bit selfish in that case.
So when I knew that I'm irresponsible bill for it, I knew that, you know, we need to put more effort to making it.
[00:33:20] Andrew Michael: What was the driving factor? Like that churn became a cause for OK. Like to become an objective mm-hmm was any specific moment in time, like a trigger, like somebody looked into something like, why did you decide then at that moment?
[00:33:36] Luka Kankaras: Yeah. So what we did is that we, because as I mentioned, our product, uh, is a. It's a different in terms of, uh, our target audience, cetera, and, and the project ended was the main turn reason people had. So that means that we really had, you know, on a monthly basis, a high number of customers living just because their project ended.
So that's when we [00:34:00] saw, you know, we have to do something about it. And, uh, once, once that whole topic was introduced in order, when we noticed actually the number of customers living and coming, you know, we knew. If we just increase the acquisition and we bring more people into it, we'll still have a lot of them leaving.
So we needed to improve retention in order to grow. So that was the main, the main reason, uh, why we decided to put more effort into it. Nice. And you know, and you also know probably that retaining a customer is much cheaper in that sense than, you know, acquiring a new one. Is it?
[00:34:38] Andrew Michael: I haven't had that before.
cool. Uh, so I wanna make sure I ask a question, ask every guest, cause I see we're running up on time as well now. Um, let's imagine a hypothetical scenario now you're joining new company general. Attention's not doing great. The CEO comes and says, Hey look, you're in charge. Like we need to turn [00:35:00] things around.
There's 90 days. What do you do the catches? You're not gonna tell me I'm gonna put out an exit survey or I'm going to speak to customers and then figure out the problems and start there. You're just gonna take one tactic that you saw that's been effective in the past and run with that blindly hoping it works with this new company.
What would you choose and why?
[00:35:20] Luka Kankaras: What would I choose and why? Yeah, so I would definitely, in that case, I would just talk, uh, I would talk more to the younger
[00:35:28] Andrew Michael: customer. Now you can't talk to customers, uh, this is, this is the, you have to pick a tactic that you've seen, that was worked. Okay. Got it. Out of all the things that maybe you did recently, like, what is the one thing that you found was most effective in reducing churn mm-hmm
[00:35:41] Luka Kankaras: So for us, uh, the most, I would say the most one was to work on the, based on the, based on the insights we, uh, we collected was to kinda improve the product according. So, what we did was most, like, see if there's [00:36:00] any additional way, you can add more value to their journey and work on that because that's, I think behind everything we did that, that's the core.
That's what help us increase retention. Mm-hmm uh, that's like, it's like, see what, you know, people are not leaving because they're paying high price. People are leaving because they're not getting enough value for that price. They're currently paying. So this would be the main tactic I would, I would.
[00:36:29] Andrew Michael: Cool.
Yeah, I think definitely there there's an X as well put together at some point, uh, post on this in terms of like, what is the cost first value matrix? And I think you can map this out pretty nice. Like, and cost can be a value of like monetary can be time. And then value can be whatever it is they're trying to get out of your service.
And typically you can put like a four by four matrix and you can look at your customers and you can see, okay, what are they paying versus what the value is? And if they're paying a lot and getting little value out of your service, they're probably the most likely to churn. [00:37:00] If they're paying a little and they're getting lots of value.
Yeah. They're gonna be the least likely and so forth. And it's actually interesting exercise to run from like a data analytics perspective, which you can do with your own data. And you can see you have different companies on different plans and you can take a look at okay. Companies on the highest plan are paying the most, like, are they using the service regularly?
Are they engaging? Are they not? It it's pretty, it sounds pretty obvious. But when you do it on a few different, like, um, verticals and metrics, you'll be able to slowly start to see some interesting patterns as well. That can help you identify good segments as well as like what you can do to improve. Um, nice.
That's a good point. What's one thing that you
[00:37:37] Luka Kankaras: go, sorry. Yeah. So one more note that I would love to, uh, to tell everyone. That kinda, I mirrors that mistake at the beginning. And that's what I said about listening to the angry customers. Uh, just because when they share negative feedback with you, uh, what we did more was what I did more was, you know, I was just thinking, oh, that's [00:38:00] just one, you know, one user I, one opinion I don't, I, I don't care.
Or, you know, it was just like, it was an isolated accident in a. So as a result, nothing happened. So I didn't learn anything from that. But now the thing is that whenever someone complains, uh, kind of, you know, do a list, do a list, check in, okay. To which particular issue that complain is related, you know, are they complaining about the, the whole system about the business, about the process, you know, uh, what is their use case kind, each negative feedback kind of analyze a bit.
And then based on understanding of that whole concept context behind it, you'll kind of find out more from that customer and the issues they had. So that's definitely something I would suggest.
[00:38:47] Andrew Michael: Good to pay attention. And also I think it's like typically if not everybody complains or gives good feed, positive feedback, it works both ways.
So like typically, like you're only in a fraction of the number of people that actually have something [00:39:00] to say about that specific issue about that specific value that they're getting. Uh, so like, Paying attention to when you do get, uh, these piece of feedback is gold and the more you can be able to quantify it, then going back and saying, okay, like we heard this, but do we see this in data?
Or do we, uh, hear this in other, uh, channels from our customers? Very important. Yeah, exactly. What's one thing, you know, today about channel retention that you wish you knew when you got started with your career.
[00:39:27] Luka Kankaras: One thing that is, um, Hmm. That's actually, I got quite a, quite a few ones. So the, the first one is basically, Hmm, let me think about it.
No, that's actually a good one. So maybe, maybe that, uh, you know, just by having a customer, like when customer leaves doesn't mean that they left, I would say for grant. There is a way that, you know, they come back. Uh, if you, if [00:40:00] you, if you, if you improve, if you improve your services, your product based on what they tell you.
[00:40:06] Andrew Michael: So listening to your customers, taking their feedback and iterating, improving very
[00:40:11] Luka Kankaras: nice when you deliver. Yeah. When you deliver something that they ask you for and, you know, they. Uh, we saw that, like when you follow up with them, they really have that, uh, you know, they're really kinda excited about it.
And most of them actually, they did not implement another solution in the meantime are willing to come back and take advantage yeah. Of those
[00:40:32] Andrew Michael: features showing that you care and have empathy towards them as well. Exactly. So, look, it's been a pleasure chatting to you today. Is there any sort of final thoughts you wanna leave the listeners with anything they should be aware of or how to gear up to speed with your work?
[00:40:46] Luka Kankaras: Yeah, sure. So you can definitely add me on LinkedIn. Uh, we can, I'm super happy to talk to other people.
Uh, actually in free time I do discuss, uh, different creative. Business issues [00:41:00] companies have. So if you have anything you wanna share with or talk with, just, uh, add me on LinkedIn and yeah. And I hope to meet you there.
[00:41:09] Andrew Michael: Awesome. Well, thank you so much for joining today. It's been a pleasure from you and wish your best of luck now going forward.
And the new journey just started with the startup as well.
[00:41:18] Luka Kankaras: Thank you Andrew so much. And I hope that yeah, you'll have a lot of success with this podcast.
[00:41:23] Andrew Michael: Thanks so much. Thanks. Cheers.
And that's a wrap for the show today with me, Andrew, Michael, I really hope you enjoyed it. And you're able to pull out something valuable for your business to keep up to date with churn.fm and be notified about new episodes. Blog posts and more subscribe to our mailing list by visiting churn.fm. Also, don't forget to subscribe to our show on iTunes, Google play, or wherever you listen to your podcasts.
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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.