6 proven ways to secure SaaS customer retention in 2025

Keeping your customers happy makes all the difference in staying ahead in the business world. Sure, landing new clients feels great, but what if they don’t stick around?

That certainly calls for SaaS customer retention.

This strategy, while smart, is the secret to making your brand thrive.

According to a Zendesk study, 74% of customers feel loyal to a particular company and about 52% of them report going out their way to make purchases from their favorite brands.

Think about that for a moment! You’d quickly realize that your long-term clients play a big role in your overall profitability.

As a business owner, you must always remember that it’s far cheaper and easier to nurture relationships with existing customers than to constantly chase new ones. It’s just like caring for a garden.

If you only focus on planting new seeds but fail to water the plants you already have, they’ll wither.

The result? You’ll be left with little to no harvest.

Likewise, without solid customer retention, you could lose a loyal base ready to drive your growth.

Interestingly, this expert-led guide explains why keeping customers is crucial for long-term success.

You’ll also discover effective strategies that will make your clients return for more.

What is SaaS customer retention?

SaaS customer retention refers to a company’s ability to keep existing clients from moving to another competitor and using their software.

It also measures the percentage of buyers who stay with a business over a given period. 

This implies that the more users you retain, the healthier your business becomes.

According to ChartMogul, top companies with an average retention rate of 85% grow up to three times faster than their competitors.

This translates to one key fact: keeping your clients close is a secret recipe for your business’s long-term success. 

How to secure a SaaS customer retention: 6 effective strategies

Retaining your buyers goes beyond delivering a great product.

You want to create an experience that will make them want to ride with you long-term. Any modern business thrives on long-term relationships, which leads to more cashflow and revenue.

Here are some tactics you can implement to keep your clients coming back for more.

1. Personalize onboarding for new users

The onboarding process is crucial in any customer journey.

As the saying goes, first impressions last longer!

So, what a potential client perceives at first sight of your brand sets the tone for how long they will interact with your brand and make purchases over time. 

For instance, whenever a new user signs up for your service, you should welcome and support them as much as possible.

Notably, every individual differs and has specific needs.

‍You can offer tutorials, customized emails, and relevant demos. 

Doing these will help new users find their “Aha” moment faster. And that’s exactly when the value of your offering clicks!

Clients now realize that your offering makes their work or life easier. It further encourages them to stay and explore even more.

2. Deliver proactive customer support

Fixing problems or solving queries isn’t just what makes your SaaS customer support great; anticipating them can give you an edge over your competitors. Proactive support means you’re one step ahead.

In fact, you’re reaching out to your clients even before they realize they need help.

Think about the last time you were pleasantly surprised when a brand solved an issue for you before it became a headache.

That’s the kind of experience you want to create as well.

So, what should you do?

Monitoring user behavior can help you spot areas where customers struggle with your product or services.

With a tactful and pleasant email, offer helpful tips, guide them via live chat, and deliver solutions before they ask.

Noticing that you are thinking about their success will impress them and will significantly reduce your churn rate. 

3. Keep customers engaged with usage-based communication

There’s a spark of excitement when a client logs in to your platform. It shows they are actively using your product.

But your real goal is to keep them coming back for more.

This is where usage-based communication comes into play. This strategy keeps users engaged and reminds them of your value offerings.

Therefore, send timely and personalized messages based on how customers interact with your product.

For instance, if you realize an active customer hasn’t logged in for a while, send them that “Hey, we miss you!” message. 

You can even highlight new features you think they’d like.

To get optimal results, you can use excellent email templates that can drive business growth and ultimately help you retain buyers.

Your active clients shouldn’t be ignored, either.

Offer tips on maximizing the product or provide sneak peeks into upcoming updates. This approach can go a long way in keeping your users engaged.

4. Provide quality products and consistently improve them

Providing quality products for your clients boosts your retention rates further.

Notably, a Hubspot survey reported that 77% of respondents agree that an excellent service that meets their needs is the top reason they stick around.

But remember, no SaaS product is ever truly “finished.” With evolving consumer needs and advancing technology, staying ahead of industry trends is vital.

Therefore, improving your products shows customers you’re committed to delivering value and staying relevant.

You may roll out new features, improve performance, or fix bugs—these help in customer retention.

However, there’s more you can do than just perform software updates. Communicate with your users with release notes or announcements. You can inform them how these upgrades further improve their experience.

The more informed they are, the better they’ll appreciate the effort you’re putting into making your service the best it can be.

5. Offer rewards and upsell strategically

Now, who doesn’t love a good reward? SaaS customer retention is more than just keeping users happy with your offerings; you also want to reward their loyalty.

You can offer a discount to those who’ve been with you for some time.

Or, you can implement a referral system where they earn perks for bringing in new users.

Also, upsell strategically by offering additional features that complement how customers already use your service.

If a client actively uses a software plan, offer them an upgraded package with more perks. This boosts revenue and enhances their experience.

6. Collect and act on feedback

Last but certainly not least, utilize feedback! This can be your secret sauce for increasing your customer retention rate.

So, regularly check in with your customers to ask how they perceive your service. You can use in-app surveys, follow-up emails, or quarterly check-ins to note your users’ thoughts and concerns.

While gathering feedback is great, what matters most is taking the needed action. Nothing says, “We value you,” like making changes based on their suggestions.

Therefore, improvements should be implemented, and recurring issues should be fixed promptly. 

Most importantly, let your customers know that their input made a difference. Now, that kind of responsiveness builds trust in your clients.

Remember that the journey doesn’t end once a customer signs up; it’s just the beginning. So, keep them happy, and they’ll come back for more!

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Advantages of SaaS customer retention 

The importance of retaining your clients cannot be overstated. In fact, holding on to your existing buyers is cheaper than looking for new ones.

A Harvard Business Review study noted that acquiring new clients costs 5 to 25 times more than keeping the ones you already have.

Let’s consider just how vital SaaS customer retention is.

1. It boosts long-term profitability

When clients stick around, they’re more likely to make repeat purchases, leading to a steady revenue stream for your business.

It aligns with a 2024 Zendesk customer experience trends report, which noted that two-thirds of consumers will buy more products based on how they are treated. 

2. It enhances customer feedback

Existing customers already know how your product works, making their feedback even more valuable.

Thus, they’re in a position to offer insights that’ll improve your services so they become appealing to them and future buyers. 

Notably, a survey by Redpoint Global revealed that 74% of respondents would stick with a company because they feel valued and understood.

Therefore, listening to and acting on user feedback goes a long way toward retaining clients. 

3. Retention boosts referrals

Happy customers will refer new individuals on your behalf.

Without needing an extensive campaign strategy, retained clients become your best promoters. They’re more likely to refer your products or services to others. 

Therefore, you wouldn’t need to spend so much acquiring new users or expanding your customer base. Indeed, nothing beats that word-of-mouth strategy.

4. It strengthens your brand’s reputation

High customer retention signals user satisfaction and trust.

The more users stay and use your product over time, the better your reputation is. This positions your SaaS brand as reliable and customer-centric.

Overall, customer retention helps maintain loyalty, boost profits, and create a growing community of individuals ready to purchase your offerings.

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Important SaaS customer retention metrics you should know

Customer retention metrics provide insights into how well your company maintains relationships with existing users.

As such, they help you focus on areas that can boost loyalty and need improvement.

Let’s discuss four major indicators and how to calculate them.

1. Customer retention rate (CRR)

This measures the percentage of customers a business retains over a specific period. It also provides insights into how well you’re holding onto your customer base over time.

Here’s how to calculate it:

CRR = (Customers at the end of a period) - (New customers acquired) / Customers at the start of a period

If you start with 1,000 users, gain 200 new customers, and end with 1,100 customers, the CRR would be: {(1100 – 200) / (1000)} x 100 = 90%

2. Churn rate

This is the percentage of users who stop doing business with you during a period. The average churn rate for SaaS brands is around 5-7%.

If it’s higher, you’re losing customers faster than you acquire them. Not paying attention to this metric can severely hurt your growth and profitability.

Here’s the formula:

Churn rate = (Number of customers lost during the period / Number of customers at the start of the period) x 100

Based on our earlier example, if you start with 1,000 users and lose 100 during the quarter, the churn rate is (100/1000) x 100 = 10%

3. Customer lifetime value (CLV)

This represents the total revenue a company can expect from a single client. This helps you understand the long-term value of a customer and measure the returns you make on acquiring and retaining them.

You can calculate it using this formula:

CLV = (Average purchase value) x (purchase frequency) x (customer lifespan)

If a user’s average purchase value is $200, the purchase frequency is 10 times per year, and the average time a customer spends with a company is five years, the CLV becomes 200 x 10 x 5 = $10,000.

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See also: Lifetime value in SaaS –- strategies for outperforming the competition.

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4. Repeat purchase rate (RPR)

This metric measures the percentage of customers who make more than one purchase. It directly indicates that users are loyal and satisfied with your offerings.

Interestingly, these repeat buyers are likely to become long-term patrons.

The calculation is as follows: 

RPR = (Number of customers who made more than one purchase) / (Total number of customers) x 100

If 300 out of 1,000 customers made more than one purchase, the RPR becomes (300/1000) x 100 = 30%.

Understanding these key performance indicators (KPIs) can help you assess how well your strategies are working. Good results indicate strong customer loyalty and long-term profitability.

On the other hand, unimpressive outcomes can help you to adjust your approach.

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Exploring 3 notable SaaS customer retention examples

Keeping your customers loyal is everything in this crowded market.

With endless options available, you want to create solid relationships and foster a delightful experience for your users.

Now, you may wonder how big brands keep their clients coming back for more.

Let’s review some inspiring SaaS customer retention examples and see how to win over clients’ hearts and build lasting connections. 

1. Amazon: delivering top-notch online shopping experiences

Amazon, a top eCommerce giant, is a specialist in retaining customers. But how did this company attain that status?

The answer lies in the seamless and exceptional customer experience it provides.

From the onset, Amazon transformed online shopping.

Users could find books and other products thanks to its well-arranged catalogs and customer reviews.

However, the company enhanced its customer experience by reducing delivery times. It also introduced two-day shipping via Amazon Prime or same-day delivery for certain items. 

It also offers detailed product information and hundreds of reviews for users who are nervous about buying online.

If that doesn’t work, they can make hassle-free returns. The focus on minimizing friction in users’ shopping experience is a major reason they love Amazon.

As such, it’s a go-to shopping destination for millions worldwide.

2. Uber: using an amazing referral campaign

The transport company Uber nailed its customer retention with its referral program. The business took off by offering users a sweet deal: refer a friend, and you get $10 in credits. This was a perfect win-win situation. This strategy rewarded new and existing customers, which increased loyalty.

As Uber grew, the rewards increased, and the company was able to record over 150 million active users worldwide. Its referral program is a straightforward yet highly effective customer retention tool.

3. Apple: an unbeatable customer service

Apple’s retention strategy focuses on the quality and consistency of its customer service. This company doesn’t rely on third parties to care for its customers.

If you have issues with your iPhone, Mac, or related product, you head to an Apple store, where highly trained staff are ready to assist.

The trust and personal connection it brings make this strategy even more brilliant.

When you purchase an Apple product, you buy an experience that lasts long after the purchase. The company ensures that every interaction you have with its brand is always positive.

Whether you’ve got a Genius Bar appointment or a quick question about your device, its customer service will satisfy you.

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Enjoy flexible financing for your business with Stenn 

SaaS customer retention is a never-ending journey that begins when your offerings connect with a customer and continues through every update and support touchpoint.

Focusing on the right strategies discussed in this guide can keep your clients more engaged and loyal to your business, ultimately leading to a steady revenue flow. 

But let’s face it: retaining customers in the SaaS global landscape is not always easy. It even becomes more challenging when there’s limited cashflow.

This is where our flexible invoice financing and revenue-based financing options become handy.

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As you focus on perfecting your approach, we’ll ensure you’ve got the financial backing to run your operations.

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