What’s a good retention rate for B2B SaaS?
This is a question that doesn’t have a straightforward answer because it really depends on a number of factors specific to your business. However as a general guide a good retention rate for B2B SaaS businesses is between 70-80%.
Of course the best way to improve your retention rate is to really understand what your customers want and need from your product or service and then make sure you’re consistently delivering on that. However there are a number of other factors that can impact your retention rate so it’s important to be aware of those too.
Some of the common reasons why customers stop using a B2B SaaS product or service include:
They no longer need the product or service: This could be because their business has changed or they’ve found a better solution.
It’s too expensive: If your prices increase or they perceive your product or service to be too expensive compared to alternatives they may stop using it.
It’s not easy to use: If your product or service is difficult to use or isn’t delivering the results they need they may give up on it.
They’re not getting enough value: If customers don’t feel like they’re getting enough value from your product or service they may cancel their subscription.
It’s not meeting their needs: This could be because their needs have changed or because your product or service isn’t actually delivering what it promises.
There are a number of other reasons why customers may stop using your B2B SaaS product or service but these are some of the most common ones. If you can identify the reasons why customers are leaving you can then take steps to address those issues and improve your retention rate.
There are a number of things you can do to improve your retention rate but it really depends on the specific circumstances of your business. However some general tips include:
Make it easy to use: If your product or service is difficult to use customers are more likely to give up on it. Make sure you have clear instructions and tutorials to help them get the most out of your product or service.
Deliver on your promises: If you’re making claims about what your product or service can do make sure you can deliver on those promises. Customers will be quick to cancel their subscription if they feel like they’re being misled.
Be responsive to customer feedback: If you’re not constantly improving your product or service based on customer feedback you’re likely to lose them. Make sure you’re constantly listening to what they want and need and then take action to improve your offering.
Keep your prices in check: If your prices increase make sure you’re providing enough value to justify the increase. If not customers will start to look for alternatives.
Make sure you’re providing enough value: This is one of the most important things you can do to improve retention. If customers feel like they’re getting value from your product or service they’re much less likely to cancel their subscription.
There is no magic retention rate that all B2B SaaS businesses should aim for. However a good retention rate is typically between 70-80%. The best way to improve retention is to really understand what your customers want and need and then make sure you’re consistently delivering on that. There are a number of other factors that can impact retention so it’s important to be aware of those too.
What’s the average customer retention rate for B2B SaaS?
Answer: The average customer retention rate for B2B SaaS is 96%.
What’s the average customer retention rate for B2C SaaS?
Answer: The average customer retention rate for B2C SaaS is 91%.
Why is customer retention important for B2B SaaS businesses?
Answer: Customer retention is important for B2B SaaS businesses because it allows them to keep their customer base which is essential for recurring revenue.
What are some ways to improve customer retention for B2B SaaS businesses?
Answer: Some ways to improve customer retention for B2B SaaS businesses include providing excellent customer service offering discounts or loyalty programs and regularly communicating with customers.
What’s the average churn rate for B2B SaaS businesses?
Answer: The average churn rate for B2B SaaS businesses is 7%.
What’s the average churn rate for B2C SaaS businesses?
Answer: The average churn rate for B2C SaaS businesses is 5%.
What is churn and why is it important to track for B2B SaaS businesses?
Answer: Churn is the percentage of customers who cancel their subscription or do not renew it.
It’s important to track for B2B SaaS businesses because it can indicate whether customers are satisfied with the product or not.
How can B2B SaaS businesses reduce churn?
Answer: B2B SaaS businesses can reduce churn by providing excellent customer service offering discounts or loyalty programs and regularly communicating with customers.
What’s the difference between customer churn and revenue churn?
Answer: Customer churn is the percentage of customers who cancel their subscription or do not renew it.
Revenue churn is the percentage of recurring revenue that is lost due to customer churn.
Why is it important to track both customer churn and revenue churn for B2B SaaS businesses?
Answer: It’s important to track both customer churn and revenue churn for B2B SaaS businesses because they can help indicate whether customers are satisfied with the product and whether the business is sustainable in the long-term.
What’s a good customer churn rate for B2B SaaS businesses?
Answer: A good customer churn rate for B2B SaaS businesses is less than 5%.
What’s a good revenue churn rate for B2B SaaS businesses?
Answer: A good revenue churn rate for B2B SaaS businesses is less than 10%.
How can B2B SaaS businesses increase customer retention?
Answer: B2B SaaS businesses can increase customer retention by providing excellent customer service offering discounts or loyalty programs and regularly communicating with customers.
What’s the best way to reduce customer churn for B2B SaaS businesses?
Answer: The best way to reduce customer churn for B2B SaaS businesses is to provide excellent customer service.
What are some common causes of customer churn for B2B SaaS businesses?
Answer: Some common causes of customer churn for B2B SaaS businesses include poor customer service high prices and a lack of features.
