BESSEMER CLOUD COMPUTING LAW #7:
The most important part of Software-as-a-Service isn’t “Software” it’s “Service”! Support, support, support!
The only acceptable reason to lose a customer is death (bankruptcy) or marriage (acquisition). Every Cloud company is in the service business, and therefore your customer service can be the difference between failure (churn) and huge success via high retention and up sells.
One of a Cloud business’s most valuable and least appreciated assets is the detailed usage statistics of its customers. For years, product marketing and product management groups in license software businesses have attempted to guess at the behavior of their customers. Despite heroic efforts, it was very hard to truly know how customers used the product on a detailed level and to incorporate this feedback in the major annual releases. Cloud businesses should instead learn from their consumer internet peers, by taking advantage of their web application architecture to analyze detailed customer usage data, use a/b test variations, iterate on small details of a page or a feature, and evolve the product each and every day.
Basic proactive monitoring for likely churn or up-sell opportunities is too simple not to do, and all Cloud businesses should do it well. You already know who logs into your product, how often, what they do inside the product, and what results they achieved. So now you need to track the key usage metrics and measures, and create internal dashboards to know which customers are getting the most value (potential up-sell candidates!) and which are likely to churn (time to intervene proactively!). Work with your marketing team to automate “low usage” reports internally, and send low usage escalation emails to your customers requesting an explanation of the behavioral changes. As you get more insight into the issues, you may want to consider techniques like expanded online training or even unlimited subscription-based training (as many leading SaaS companies are now doing) to drive adoption and awareness.
It is likely that your Cloud business will experience system outages over time. As long as you are keenly focused on backup and disaster recovery and thus avoid a data loss, these will not be fatal. How you han