5 All-Too-Common Strategy Mistakes You Might Be Making

May 14, 2019

It’s always easier for Monday morning quarterbacks to say what should have been done than to plan for success. However, in the SaaS world there are absolutely some dos and don’ts around building a successful brand and keeping those dreaded churn rates low. Here are some of the most common mistakes SaaS companies make, according to experts.

1. You seem the same as everybody else

Your prospects and customers literally have 6,800 options to wade through in order to find answers to a select few–often industry-specific–problems. If every website they come across is advertising an “Optimized business solution to increase your ROI,” they’re going to get overwhelmed pretty quickly and might even sign up for your product by mistake (more on that later).

2. You’re not onboarding

According to Len Markidan at Groove, there are two “major milestones” in the customer journey: the moment they decide to purchase your product, and the moment they have their first success using your product.

Chances are, you were there for the first. Skipping the second could be a huge mistake. Often, when customers cancel a subscription, it’s because the product didn’t do what they wanted it to do. The onboarding process should be simple, clear and immediately establish your product’s value. Even a friendly greeting can go a long way toward winning over customers. Online test prep company, Magoosh, saw a 17% jump in conversion rates simply by offering a welcoming onboarding message rather than a run-of-the-mill sign up homescreen.

3. You’re not upselling

We all know that keeping a customer is better (and less costly) than acquiring a new one. But failing to upsell those that are already fans of your product is a revenue source that you could be overlooking.

According to Paul Farris, author of Marketing Metrics: The Definitive Guide to Measuring Marketing Performance, your chances of selling to a new customer hover at a respectable 5-20%. But your chances of selling to an existing customer are much higher–60-70% higher.

4. You’re assuming any customer is a good customer

Of course, customers are the lifeblood of any SaaS company, but attracting the wrong customers could actually hurt business in the long run. Wrong fit customers aren’t simply unhappy customers, according to Lincoln Murphy at Sixteen Ventures. Instead, they’re customers for whom “you cannot deliver immediate value, nor can you–based on where you’re at today, your available resources, etc.–realistically deliver future value in the required timeframe for these customers.”

Training salespeople to spot the right customers and being completely transparent about what your product can and can’t do will not only help your churn rate, but will also save your customer support team a lot of headaches.

5. You have no idea why your customers are churning

Keeping churn rate down is a matter of survival for SaaS companies, and that’s why you’ve got to fight it with “hand-to-hand combat.” But it’s impossible to fight what you don’t understand.

Surveying churned customers about why they left isn’t fun; no one likes to hear the negatives. But if one customer has a problem, chances are, others do too. According to Groove, for every one customer complaint you receive, you’ve actually got 26 angry customers who may have simply walked away. Finding the problems that caused other customers to leave goes a long way toward preventing future churn.

The most important thing to remember is that SaaS customers are real people looking to solve problems with your product. Focusing on customers as people rather than churn rate numbers is the key to ensuring they’re taking full advantage of the benefits your company offers. Remember that, and it should be smooth sailing.

Anna Talerico


Anna is a SaaS operator who loves giving practical advice about sales, management, company culture, customer success and capital-efficiency. At her former company she led customer-facing teams which included sales, customer success, professional services and product support. When that company was acquired in 2017, she co-founded Beacon9 to help other tech companies chart their successful path forward in these same areas.