10 ms·

Help! SAAS revenue dropping 50% month on month. 3rd month, numbers look scary.

15 points by hnTerebi 10y ago

Monthly recurring revenue has dropped 50% month on month for 3rd straight month. At first I thought it was just a blip. But 2 blips and now it looks like a trend. Its 4 year old desktop application, revenue was growing steadily before that. I feel like this has come out of NOWHERE, i'm struggling to even begin to figure out what was the cause. I did some Googling and I found a helpful post by Amy Hoy, she suggested this> 1. Earn more per customer. 2. Get more customers. 3. Keep more customers you already have. ------ So far I have figured out I can start doing this. 1. Up-sell customers to my other products 2. Investigate if I can create or add a paid add-on service to the current product 3. Start posting on community forums 4. Start contacting more sites to review the product 5. Convert more trial -> paid accounts 6. Find out why customers are failing to renew their services and fix the problem. How do I find out what was the cause of the drop? I literally have no idea where to start... The only thing I know what to do is whatever I can to at least re-start my marketing efforts. Any advice appreciated...

deleted 10y ago
[deleted]
ckluis 10y ago
1 - what do your analytics show? 2 - do you have something like intercom.io installed to message customers based on usage? 3 - call customers who are leaving and ask why? ask if you can fix it (if valid) and ask if you can offer them something to stay 4 - I hope by re-start you do not mean - you stopped marketing. It should never stop and always evolve.
ig1 10y ago
Call your (ex-)customers and ask them.
nanis 10y ago
There is one question you must answer first: WHAT CHANGED? Your application may not have changed, but the environment in which it operates may have. Is there a new alternative in that space? Don't limit your attention just to things that look exactly like yours: Consider everything that might conceivably be used instead of it. Or, are there new legal requirements which your product fails to satisfy? Or, did the legal requirement that necessitated the use of your product disappear? Also, given that this is recurring revenue, I am assuming you have a customer database, and you know who cancelled subscriptions. Do consider contacting a random sample of them and asking straight up if they would mind telling you why they stopped using it, and how they think you could improve the product to best serve their needs. Also, order of magnitude would be helpful here: Did 30 customers cancel? 300? 3,000? ... 30,000,000?
- hnTerebi 10y ago
  I'm losing about 10 customers a week from recurring billings not re-signing. They value from $27 to $100. Over the last 4 months, total number of users that didn't upgrade from trial -> paid or just expired was: ~4000 users. I will run report on cancellations that happen and email them all and ask why they cancelled (I do have automatic email that gets sent on cancellation but I never get a response from those).
karterk 10y ago
You can't reverse the trend if you don't know why exactly it's happening. First talk to those who are cancelling to find out why. For e.g. add a mandatory field on the cancellation form that asks them to describe why they are quitting you service.
- brudgers 10y ago
  I'd say personal contact rather than a mandatory field will garner more helpful responses...since my response to a mandatory field might be "because you disrepsect my time with things like this here mandatory field" even though I'd already decided to drop the service for other reasons.
  - saluki 10y ago
    Yeah, no one likes a mandatory field on cancellation. However, in my experience the mandatory field gets useful feedback about 90% of the time and the other 10% are just people entering something to complete their cancellation. Definitely worth trying to get feedback as users cancel. You could make it mandatory till you get a handle on what's gone wrong then leave it in place as an optional field once things settle down.
    - brudgers 10y ago
      Even better would be listening to existing customers and take steps to increase retention. Collecting data after cancellation requires allowing "the bad thing" to happen.
      - saluki 10y ago
        Double True, definitely need to listen (and watch) existing users to keep increasing the value your app provides to keep them happy. A page out of patio11's playbook is tracking users that visit your cancellation page but don't cancel so you can connect with them right away to try to avoid 'the bad thing'.
citizens 10y ago
Are your original subscribers credit cards expiring? Any failing webhooks preventing invoices from being charged?
MalcolmDiggs 10y ago
It sounds like you need data, and lots of it. Here's a good place to start: http://www.amazon.com/Lean-Analytics-Better-Startup-Faster/dp/1449335675 http://www.amazon.com/Lean-Analytics-Better-Startup-Faster/d...
- hnTerebi 10y ago
  Yes, thats the biggest issue. No actionable data. Thanks for link I'll have a read.
codegeek 10y ago
Some of the things to look for: 1. ACQUISITION: Has the number of new clients that you gain gone down significantly ? If yes, look into your current sales and marketing channels. For example, if you used to get a lot of inbound marketing (through search engine etc), check if your search engine rankings has taken a bit hit suddenly. Has google penalized you suddenly ? Have you lost some key backlinks or referrals that were providing you significant traffic and conversions before ? For outbound marketing, have you lost a key resource on your team ? 2. ATTRITION: If you are losing "current" clients at a significantly higher rate, talk to them directly when they cancel. Has something changed in your SAAS suddenly ? Did you drop a major feature ? Has your customer support changed a lot compared to 3 months ago ? Has a new competitor come up or an existing competitor is getting your current clients to join them instead ? 3. BUSINESS DOMAIN: Do you do business in a specific domain that is perhaps seasonal ? Is it possible that you may have a slower business during certain times of the year ? Just throwing this out as well. Find answers to these questions above and I am sure you will get an idea of where things are going wrong.
- hnTerebi 10y ago
  1. New users trial signups are the same and steady, ~30 a day. 2. Yes attrition rate has been very high. Why? I don't know. Most of the cancellations don't leave any feedback (or its not usable -> Will re-design cancellation form). 3. Lots of my new signups have been via partnerships with blogs that sell training and use my product as part of it. It could very well be that the numbers are new users that start the process, signup but they lose motivation along the way. But I don't have data to back this up.
tmaly 10y ago
Have you tried to collect some exit data from customers that are leaving your service? Maybe they are going to something else? Maybe they are not seeing the benefit? Doing a simple single multiple choice question would give you some more perspective.
- hnTerebi 10y ago
  Most answers from exit survey aren't answered. But I emailed some users and about half of them that replied are saying they want a Mac OSX version of the software. Unfortunately I can't even bundle the windows app using crossover because it crashes. Unless I poney out $3000 to hire the crossover team to make investigate it and try make it work. Not sure if its sign of the times or something else?
saluki 10y ago
First sign up for a subscription with a live card make sure signups are still working properly. Setup a plan to renew on a live card tomorrow, make sure that's working. Setup tracking on which users visit your cancellation page but don't cancel. Setup a page to view this in your dashboard. Email each one personally and ask them how their experience is going see if they have any questions or have suggestions to improve your app make it more valuable to them. Adding a required text box on the cancellation page asking why they are leaving is a good way to get feedback. Personally email every user you can, start with cancellations say "Just reaching out to see if there is a reason you cancelled and are there any improvements I can make to make the application better? Any feedback you can provide would be appreciated". Next email new signups to see how their experience is going. Check all your domains, browse through your funnel make sure signups are working nothing is broken on the site. Test out your app run through with a new account as a user and make sure things are working properly. Check error logs any issues users could be seeing. Check your traffic, organic search rank and make sure you haven't fallen out of favor with Google. (Investigate your typical traffic sources/analytics). Add code to start tracking logins, how users are using your SaaS to see if you can see which users are active or maybe active then drop off. Follow up with them see if you can help. Good luck turning the ship around.
- hnTerebi 10y ago
  Since its a desktop app, I haven't added any analytics past the download exe stage, I will look into it once I read that book about lean analytics. I do feel literally in the dark about things.
  - saluki 10y ago
    Gathering analytics from a desktop app will be more difficult than a web app. You might want to reach out to the guys at StartUpsForTheRestOfUs.com they've both had desktop apps in the past. Just email a question about desktop app analytics and also about your drop off in subscribers. They might email back and/or answer it on the podcast.
_____s 10y ago
The first thing I'd do is e-mail people who are cancelling and ask them the reason. Upselling current customers doesn't really stop the churn, and a 50% drop rate means there's something seriously wrong. Asking people nicely will get you a lot of answers, especially when there are so many people cancelling.
ruyi 10y ago
Need a lot more info. You need to find data that answers the following questions: 1. Any major changes/events within the past 6 months? (or, is your product still as good as it was 6 months ago?) 2. Any new competitors? Any existing competitor had a major update/upgrade on their product? 3. How is the industry your product serves doing? 4. Any (strategy or metrics) changes on marketing? 5. How are your customers doing? Also, it helps a lot to schedule some calls with customers who left.
WhatIsThisIm12 10y ago
Query your database for all active users, print list of emails. Transfer list to text editor. Paste into BCC field of email. Ask them what they want.
55555 10y ago
You should link to your product. It probably won't hurt, and will improve the advice we can offer you.

15 points by hnTerebi 10y ago

deleted 10y ago

[deleted]

ckluis 10y ago

1 - what do your analytics show? 2 - do you have something like intercom.io installed to message customers based on usage? 3 - call customers who are leaving and ask why? ask if you can fix it (if valid) and ask if you can offer them something to stay 4 - I hope by re-start you do not mean - you stopped marketing. It should never stop and always evolve.

ig1 10y ago

Call your (ex-)customers and ask them.

nanis 10y ago

There is one question you must answer first: WHAT CHANGED? Your application may not have changed, but the environment in which it operates may have. Is there a new alternative in that space? Don't limit your attention just to things that look exactly like yours: Consider everything that might conceivably be used instead of it. Or, are there new legal requirements which your product fails to satisfy? Or, did the legal requirement that necessitated the use of your product disappear? Also, given that this is recurring revenue, I am assuming you have a customer database, and you know who cancelled subscriptions. Do consider contacting a random sample of them and asking straight up if they would mind telling you why they stopped using it, and how they think you could improve the product to best serve their needs. Also, order of magnitude would be helpful here: Did 30 customers cancel? 300? 3,000? ... 30,000,000?

hnTerebi 10y ago
I'm losing about 10 customers a week from recurring billings not re-signing. They value from $27 to $100. Over the last 4 months, total number of users that didn't upgrade from trial -> paid or just expired was: ~4000 users. I will run report on cancellations that happen and email them all and ask why they cancelled (I do have automatic email that gets sent on cancellation but I never get a response from those).

karterk 10y ago

You can't reverse the trend if you don't know why exactly it's happening. First talk to those who are cancelling to find out why. For e.g. add a mandatory field on the cancellation form that asks them to describe why they are quitting you service.

brudgers 10y ago
I'd say personal contact rather than a mandatory field will garner more helpful responses...since my response to a mandatory field might be "because you disrepsect my time with things like this here mandatory field" even though I'd already decided to drop the service for other reasons.
- saluki 10y ago
  Yeah, no one likes a mandatory field on cancellation. However, in my experience the mandatory field gets useful feedback about 90% of the time and the other 10% are just people entering something to complete their cancellation. Definitely worth trying to get feedback as users cancel. You could make it mandatory till you get a handle on what's gone wrong then leave it in place as an optional field once things settle down.
  - brudgers 10y ago
    Even better would be listening to existing customers and take steps to increase retention. Collecting data after cancellation requires allowing "the bad thing" to happen.
    - saluki 10y ago
      Double True, definitely need to listen (and watch) existing users to keep increasing the value your app provides to keep them happy. A page out of patio11's playbook is tracking users that visit your cancellation page but don't cancel so you can connect with them right away to try to avoid 'the bad thing'.

citizens 10y ago

Are your original subscribers credit cards expiring? Any failing webhooks preventing invoices from being charged?

MalcolmDiggs 10y ago

It sounds like you need data, and lots of it. Here's a good place to start: http://www.amazon.com/Lean-Analytics-Better-Startup-Faster/dp/1449335675 http://www.amazon.com/Lean-Analytics-Better-Startup-Faster/d...

hnTerebi 10y ago
Yes, thats the biggest issue. No actionable data. Thanks for link I'll have a read.

codegeek 10y ago

Some of the things to look for: 1. ACQUISITION: Has the number of new clients that you gain gone down significantly ? If yes, look into your current sales and marketing channels. For example, if you used to get a lot of inbound marketing (through search engine etc), check if your search engine rankings has taken a bit hit suddenly. Has google penalized you suddenly ? Have you lost some key backlinks or referrals that were providing you significant traffic and conversions before ? For outbound marketing, have you lost a key resource on your team ? 2. ATTRITION: If you are losing "current" clients at a significantly higher rate, talk to them directly when they cancel. Has something changed in your SAAS suddenly ? Did you drop a major feature ? Has your customer support changed a lot compared to 3 months ago ? Has a new competitor come up or an existing competitor is getting your current clients to join them instead ? 3. BUSINESS DOMAIN: Do you do business in a specific domain that is perhaps seasonal ? Is it possible that you may have a slower business during certain times of the year ? Just throwing this out as well. Find answers to these questions above and I am sure you will get an idea of where things are going wrong.

hnTerebi 10y ago
1. New users trial signups are the same and steady, ~30 a day. 2. Yes attrition rate has been very high. Why? I don't know. Most of the cancellations don't leave any feedback (or its not usable -> Will re-design cancellation form). 3. Lots of my new signups have been via partnerships with blogs that sell training and use my product as part of it. It could very well be that the numbers are new users that start the process, signup but they lose motivation along the way. But I don't have data to back this up.

tmaly 10y ago

Have you tried to collect some exit data from customers that are leaving your service? Maybe they are going to something else? Maybe they are not seeing the benefit? Doing a simple single multiple choice question would give you some more perspective.

hnTerebi 10y ago
Most answers from exit survey aren't answered. But I emailed some users and about half of them that replied are saying they want a Mac OSX version of the software. Unfortunately I can't even bundle the windows app using crossover because it crashes. Unless I poney out $3000 to hire the crossover team to make investigate it and try make it work. Not sure if its sign of the times or something else?

saluki 10y ago

First sign up for a subscription with a live card make sure signups are still working properly. Setup a plan to renew on a live card tomorrow, make sure that's working. Setup tracking on which users visit your cancellation page but don't cancel. Setup a page to view this in your dashboard. Email each one personally and ask them how their experience is going see if they have any questions or have suggestions to improve your app make it more valuable to them. Adding a required text box on the cancellation page asking why they are leaving is a good way to get feedback. Personally email every user you can, start with cancellations say "Just reaching out to see if there is a reason you cancelled and are there any improvements I can make to make the application better? Any feedback you can provide would be appreciated". Next email new signups to see how their experience is going. Check all your domains, browse through your funnel make sure signups are working nothing is broken on the site. Test out your app run through with a new account as a user and make sure things are working properly. Check error logs any issues users could be seeing. Check your traffic, organic search rank and make sure you haven't fallen out of favor with Google. (Investigate your typical traffic sources/analytics). Add code to start tracking logins, how users are using your SaaS to see if you can see which users are active or maybe active then drop off. Follow up with them see if you can help. Good luck turning the ship around.

hnTerebi 10y ago
Since its a desktop app, I haven't added any analytics past the download exe stage, I will look into it once I read that book about lean analytics. I do feel literally in the dark about things.
- saluki 10y ago
  Gathering analytics from a desktop app will be more difficult than a web app. You might want to reach out to the guys at StartUpsForTheRestOfUs.com they've both had desktop apps in the past. Just email a question about desktop app analytics and also about your drop off in subscribers. They might email back and/or answer it on the podcast.

_____s 10y ago

The first thing I'd do is e-mail people who are cancelling and ask them the reason. Upselling current customers doesn't really stop the churn, and a 50% drop rate means there's something seriously wrong. Asking people nicely will get you a lot of answers, especially when there are so many people cancelling.

ruyi 10y ago

Need a lot more info. You need to find data that answers the following questions: 1. Any major changes/events within the past 6 months? (or, is your product still as good as it was 6 months ago?) 2. Any new competitors? Any existing competitor had a major update/upgrade on their product? 3. How is the industry your product serves doing? 4. Any (strategy or metrics) changes on marketing? 5. How are your customers doing? Also, it helps a lot to schedule some calls with customers who left.

WhatIsThisIm12 10y ago

Query your database for all active users, print list of emails. Transfer list to text editor. Paste into BCC field of email. Ask them what they want.

55555 10y ago

You should link to your product. It probably won't hurt, and will improve the advice we can offer you.