Slaying SaaS churn with Integrations

This post is excerpted from our Price Intelligently blog.

Your customers have a “use it or lose it” mentality about your product. They'll happily pay for a product that's giving them value. But if they're not using it, that value disappears (along with their business).

Integrations let you avoid that outcome by giving you more opportunities to get your product in front of your users. It embeds your product naturally in your user's workflow, making it increasingly necessary to their process. By creating more pathways to and from your product, a meaningful integration can compound your product’s stickiness and value.

When users find more value in your product (and more reasons to use it), they engage more and are less likely to churn. Integrations can be the conduit your product needs to provide a better user experience and promote engagement.

Integrations keep activity high

According to sales analytics platform InsightSquared, increasing engagement can ward off the risk of churn. Higher engagement and lower churn mean more revenue for your company and larger opportunities for growth.

Integrations directly increase engagement by expanding your product's utility and visibility:

• Users can incorporate your product into a new workflow
• Users can build out their workflow around your product
• Users constantly interact with your product at different stages of their big-picture process

You need to keep engagement high to keep users from cancelling their subscriptions. A decrease in customer engagement is called activity churn, and it indicates that customers are finding less and less value in your product.

[Adapted from a graph by Intercom]

Activity churn is a leading indicator of cancellation. Decisions to churn are not made in an instant—they're made weeks or months before a customer actually cancels. You can see this stage above in the red-flag zone, as customer usage slowly declines.

Since user churn undermines growth and drains your MRR, reducing your churn is a direct way to increase your MRR.

You can be proactive about reducing user churn by focusing on increasing your product's utility and visibility. Adding integrations helps users leverage more value, which in turn increases engagement and reduces activity (and thereby user) churn. All of this adds up to more cash in the bank for your company.

Integrations give users more reasons to engage

Integrations with third-party products help reduce activity churn because they give customers more ways to engage with your product. They help your product to constantly show its value in many different ways.

Integrations help you embed your product in a SaaS ecosystem, which ultimately strengthens customer retention and benefits your company by increasing productivity, increasing depth and breadth of usage, and improving distribution and visibility.

Merging apps makes workflows more productive

Your product aims to improve a specific aspect of your customer's life or a specific part of their workflow, but ultimately it's part of a larger picture. When you integrate with other apps, you show how your product fits into the big picture of accomplishing tasks and solving problems.

Increased productivity contributes to a stickier user experience that discourages customer churn. For example, Zapier found that Typeform users who integrated with Zapier to push Typeform data to their other services showed about 40% less churn than users who used Typeform on its own.

[Source]

About 15% of the cohort of Typeform users who integrated with Zapier had churned at some point in 12 months. Meanwhile around 25% of the cohort of users who just used Typeform churned within the same time frame.

 The ability to use Zapier to push Typeform data to other apps adds to the productivity of teams who want to use their Typeform data. While this added productivity is not necessarily a direct cause of lower churn, it is a contributing factor to a better user experience because it encourages users to get more value from the data that Typeform provides.

 Integrated products can make a workflow more productive by:

• Facilitating the sharing of information
• Encouraging communication in the context of your product
• Compiling different types of data in one place

Embedding within your user's workflow and improving their productivity can give you an edge in the competitive SaaS landscape. For example, one Intercom user reports that though he has subscriptions to Intercom, Mixpanel, and UserVoice, he uses Intercom the most because it's the only one with a Slack integration. Here, the integration allows Intercom to capture the value generated by Slack’s product.

[Source]

The team can merge customer support tickets and the surrounding conversation in one place, increasing productivity in answering the tickets. Intercom has become embedded in a channel that already had high engagement from this team—and as a result, this user calls Intercom “stickier” than the other products without Slack integrations.

Intercom doesn’t need to be stickier than its competitors, so long as the experience of using Intercom is stickier—and integrations can get it there.

Other products give new perspective on depth and breadth of your product

Integrations also expose the depth and breadth of your products that may not be immediately apparent to your users. This gives added incentive for a user to open your product and use it for a longer period of time.

The integration should fit your target market, so that it adds the depth that your users need. It should be a natural extension, so that it adds the breadth that your users would seek.

For instance, Kevy's integration with Magento specifically supports eCommerce companies who want to expand and grow online businesses. Magento provides a platform for eCommerce businesses, and Kevy helps an eCommerce company engage with customers and personalize online marketing. The two work together seamlessly because they both are built for eCommerce customers. Kevy's options for personalizing and customizing the user experience are a natural extension for eCommerce customers building a platform with Magento.

 Integrated products can also expand your customers' product usage by:

• Drawing attention to underutilized features
• Adding supplementary data that supports data from your product
• Analyzing data from your product in a different way to help users reach new conclusions

For example, Stripe, Braintree, and Zuora integrate with ProfitWell to turn the data that these platforms collect collect on subscription payments into graphs and charts for free, like this cohort analysis below.

These graphs help Stripe, Braintree, and Zuora users leverage the data provided in more meaningful ways. For example, a company using Stripe can see changes in data from multiple paying users graphed over time. This could help a company find trends in a certain company's payments over time, or even uncover a payment trend within cohorts of customers.

These trends that would be very difficult to visualize from dispersed raw data become clear when using a tool like ProfitWell. Stripe users can reach new conclusions and better see the value of their Stripe data. At the same time, users can better see the value of ProfitWell's data tracking systems when they use it to analyze their stripe data. The integration mutually highlights the depth and breadth of both products' value.

Partnerships with well-known companies increase product visibility

Integrations with a more well-known products can help your product “ride the wave” of a larger platform. These integrations with popular products put your product in front of a hugely expanded market of potential users.

Brian Balfour of CoElevate and Reforge points out that “products are built to fit specific channels,” and that should inform your product integrations. Your product can take advantage of the distribution channel of a larger product (Product X) by adding value for Product X's large base of existing customers. This increases your own product's visibility and distribution potential.

Growbot, for instance, was built to capitalize on Slack's huge user base of over 4 million users. Growbot is a tool that allows team members to support one another with affirmations (called “cheers”) for a job well done, and tallies points that each team member receives for each cheers. Cheers are communicated and tallied on Slack and take advantage of specific Slack features, like the ability to @ mention a teammate, and the ability to add emoji reactions to messages.

Yet Growbot is its own tool with a separate value proposition from Slack. It adds additional value to Slack users, but was created to leverage the visibility and distribution of a high-volume, high-engagement partner product. 

Partnerships through integration can also benefit your company because:

• They confer trust from established products to your product by association
• They make your brand name visible to customers already using the integrated tool
• They can be used to create incentive programs that boost visibility and engagement

For instance, Jet Blue's app recently integrated with Lyft to help travelers get to and from the airport and support their larger-picture travel plans.

When travelers flying with JetBlue call a ride with Lyft from within the JetBlue app, they earn JetBlue loyalty points (which they can then use to gain other JetBlue benefits). This integration is great for Lyft, because JetBlue helps incentivize users to engage with Lyft's service. It's also beneficial for JetBlue because the Lyft integration provides additional reason for users to engage with their app. It adds value to the app product and makes it stickier and more necessary for a traveler.

[Source]

Since Lyft is already a well-known ride sharing app, the utility of JetBlue's app (which is secondary to its airline services) benefits from the clout that Lyft confers. The overall integration helps to highlight the value of both apps to users who want to make travel plans.

Support your users' big-picture plans

Integrations support and enhance your customer's big-picture process. They are valuable because they embed your product in a SaaS ecosystem. Integrating your product with other SaaS products communicates to your customers that your company is looking to improve their entire user experience. 

Better user experience supports increased engagement, which is the high-level antidote to churn. Add concrete value to your product by adding integrations—you'll combat churn and support your company's growth.