The HotLine Magazine Archives
For The Profession of Cloud/SaaS Product Support
By Mikael Blaisdell

It is often said that Support & Service must necessarily be better in the OnDemand / Software as a Service ecosystem because “the customer could leave at any time. Therefore, we have to continuously earn our customers’ loyalty every month.” In reality, however, how many SaaS companies truly operate as if they were concerned about customer retention? What percentage of your customer base is at-risk? If you offered your customers an easy off-ramp, a way to painlessly migrate to another vendor, how many would take advantage of it? Or if a competitor suddenly offered to buy your customers, would they be for sale?

data protectionWhile I’m asking the question rhetorically, your competitors may soon be asking it for real. In the SaaS CRM, SFA & Contact Center Technology (CCTECH) space, one company, Salesboom Inc., has formally laid the challenge on the table. If you’re a customer of their principal competitor, Salesboom will not only provide you with a Migration Magic Button to seamlessly pull all of your data — including custom tabs / fields / implementations and processes — across to their system, they’ll even cut you a check for $5,000 as an enticement to make the trip. Though there are some restrictions, the offer is well within reach to a huge number of the prospective customers. Will the campaign work? How confident in your customers’ loyalty would you feel, if you were the targeted company?

relationship-broken-smWhen loyalty runs only or mostly in one direction, there can come a moment of realization. I dealt with the same bank for over 25 years, until I found out that only I thought of it as a relationship. When another bank came along, and asked for my business, offering equal products and demonstrating that they wanted to establish a relationship, I discovered the difference between what I had gradually become accustomed to and what I really wanted. The realization that what I had was a pattern of behavior, and what I wanted was a relationship, was all it took to make the decision. When I took the extra step of telling my former bank I was considering leaving, and got no reply at all, my decision was completely validated. I wonder how Salesboom’s competitor will react to those customers who decide to seriously consider or take the offer. Will there be a response?

exclamation-mark-in-circleRelying on a supposed superiority of a technological product is a short-term customer retention strategy. The relative height of the barriers to competitors are variable — and essentially unreliable. Sooner or later, someone will match the technology or improve upon it and put an offer on the table to your customers. If the technology and whatever ingrained habits have been developed over time is all that holds your customers, the arrival of the competitor’s bid may be a very painful moment. Either the customers will be lost, or the effort of playing catch-up ball to save the relationship will be exceptionally expensive.

What percentage of your customer base is for sale? Can you afford to ignore that question? The data hidden in your customer contact center can help you to determine your risk; if you aren’t sure how to use it, I’m here to help. No one can compel you to ask the question. But a competitor may well hand you the answer.

tssf-100x50To discuss this article, please join us in The SaaS Support Forum by following this link.  (Information about TSSF may be found here.)

March 4, 2008