Customer retention is one of the most important aspects of any business. And customer retention emails are a vital part of all email marketing strategies… but especially for SaaS businesses. That’s because, even if you have the best customer acquisition strategies in your industry, you’re never going to really scale if you’re consistently losing customers on the back end. It's essential to focus on keeping your customers happy and coming back for more.
In this guide, we’re going to cover all things related to customer retention emails — what they are, why they work, how you can create a winning retention email strategy, and some real-life examples of fantastic customer retention emails. Let’s dive in!
What are customer retention emails?
Customer retention emails are emails that are sent to existing customers with the intention of retaining them as loyal customers and encouraging them to continue using your SaaS product. Customer retention emails are actually the most common form of email marketing used today.
There are many different forms and types of customer retention emails that can be tailored to unique situations and specific categories of customers. But the common thread is that customer retention emails are always designed to keep your product top-of-mind with your customers, enhancing the customer experience, and increasing customer satisfaction.
Why are customer retention emails so effective?
First, let’s start by examining why retention in general is so important for SaaS businesses and so effective when retention strategies are well-implemented. Like we said earlier, customer acquisition (even amazing customer acquisition) can never make up for a churn problem. Neither can state-of-the-art onboarding, effective sales strategies, etc. Churn is a silent SaaS killer.
Plus, acquisition is always going to cost you. In fact, acquiring a new customer is five times more expensive than keeping an existing one. On the other hand, just a 5% increase in customer retention can increase profits between 25-95%. That’s why getting serious about retention is an absolute must for SaaS businesses.
And part of putting a greater focus on retention is crafting a solid retention email strategy. Let’s talk about a few reasons why email marketing can be so effective when it comes to retention…
1. Existing customers are much more likely to buy from you
Research shows that the success rate of selling to a brand-new customer is between 5-20%. But when it comes to selling to existing customers, the success rate improves to 60-70%. That’s because people typically prefer to buy from brands they know than a brand they’ve only recently heard of. Customer retention emails help you capitalize on that. By sending retention emails to existing customers, you not only make it more likely that they’ll continue their current subscription but also increase the potential for an upsell to a new product or a higher tier.
2. Triggered emails result in higher open & click-through rates
A good customer retention email strategy will make use, at least in part, of triggered emails — meaning automated emails that are sent as a result of a user’s action (or inaction). And triggered emails are 95% more likely to be opened than a mass-delivered email blast. They also have twice the click-through rate.
3. Customer retention emails allow for personalization
A huge reason why customer retention emails are so effective is because they allow for personalization in a way that other advertising and retention strategies may not. Churn is hugely personal and varies widely across your customer base. Customer retention emails allow you to fine-tune your retention strategy to specific customers and their unique circumstances.
Personalization is not only effective from a strategic standpoint — it’s also more likely to increase customer satisfaction. If a customer is receiving emails that are tailored to them and their pain points or specific needs, they’re much more likely to respond positively than they would to a mass email. And customer satisfaction is a major key to solid retention.
4. Customer retention emails enhance brand awareness
You know the phrase “out of the sight, out of mind”. With so much competition in the SaaS space and the constant threat of churn, the last thing you want to be is out of sight. Keeping the utility and value of your product front and center (and your brand top of mind) for your customers is key when it comes to retention.
Once a customer has provided you with their email, whether it’s to sign up for a free trial, subscribe to your product, or even just get on your email list, it’s in your best interest to keep in regular contact. If they engage with your brand once and then never hear from you again, they’re much more likely to forget about you and your product. By sending consistent customer retention emails, you can establish yourself as a value-adding presence in their inbox, build a strong connection, and remind customers of how your product can solve their pain points and improve their lives.
How do you build an effective customer retention email strategy?
Now that we understand a little more about the “why” behind customer retention emails, let’s get into the “how”. Here are some tips for creating effective customer retention emails:
Focus on at-risk customers
A good strategy for customer retention emails is to put a lot of focus on customers who are at-risk. At-risk customers include any customers who are currently subscribed to your product but are exhibiting signs or behaving in a way that suggests they may be considering cancellation. This could be customers who haven’t logged in for a while, haven’t adopted a new feature, or haven’t upgraded from the free version to the paid version. Customer retention emails are a great opportunity to prevent at-risk customers from churning before they ever cancel their subscription.
Leverage data from happy customers
While it’s very important to focus on at-risk customers in your customer retention strategy, you don’t want to forget about your happy customers. That’s because your happy, loyal customers can provide a wealth of information and data that can actually help you retain more customers. After all, clearly something is going right with these customers.
Make sure you’re taking advantage of the information these happy customers can provide for you. Solicit feedback regularly from loyal customers and try to focus on the specific features of your product. What do they praise the most? What feature or functionality most effectively solves their major problems? What part of the product do they use most often? The answers to these questions can give you a starting point for the messaging in your customer retention emails directed towards at-risk customers.
Keep it simple
If you want to take full advantage of your customer retention emails, then you need to focus on content. Sending aeshetically-pleasing emails with finely-crafted copy won’t mean anything if the content of the email isn’t geared towards your specific customers. That doesn’t mean you can’t send beautifully-desngied customer retention emails. But you want to put the content above all else. Consider where your customer is on their customer journey, what their pain points are, and what you can include in your email that will directly address their needs.
Choose the right subject line
The subject line is vital because it’s the first thing your customer will see in their inbox. That means it’s also the moment that they’ll decide whether or not to open your email. If they don’t open it, then it’s not going to help your customer retention strategy. Aim to keep your subject line short, straightforward, and written in your brand’s natural voice. You should always communicate exactly what your email is about in the subject line. And, if you can, this is also a great place to begin focusing on your product’s value.
Make your value clear
In order to retain more customers, you need to make it clear what your product does for them. While the value proposition of your product is likely what drew your existing customers in at the beginning, it’s possible that, over time, they’ve lost sight of that value or forgotten what brought them to your product initially. Customer retention emails are an opportunity to remind customers of what makes your product stand out, what specific pain points it addresses, etc.
Part of building an effective customer retention email strategy is to maintain a consistent flow. An element of that involves the schedule on which you send your retention emails. After all, nobody wants to be constantly spammed with retention emails. If you send them too frequently, you’re likely to do more harm than good.
But consistency is about more than the frequency with which you send emails. You also want to be consistent with the types of emails you send and why you send them out — in other words, what triggers them. Essentially, you want your retention emails to be consistent enough that customers know basically when to expect emails from you. For instance, they may come to recognize that they receive emails when they haven’t utilized a new feature, when they’ve been inactive for a while, etc.
Build in feedback loops
Feedback loops are absolutely essential for customer retention. Hearing what your customers love about your product (and what they don’t) is the best way to ensure you’re keeping your product up-to-date and truly valuable. Customer retention emails are a perfect spot for building feedback loops. Make sure you’re giving your customers a clear, simple way to offer feedback so you can get a better grasp on what makes your product effective and why customers might churn.
Examples of great customer retention emails
We mentioned earlier that there are many different forms and types of customer retention emails. We’ve rounded up some great examples of a few different types.
Consider welcome emails the very first of your customer retention emails. This is your chance to make a great first impression, begin to establish brand loyalty, reiterate the value of your product, and keep your brand top-of-mind. Plus, welcome emails are popular — they have an open rate of 50%. Here’s an example from Asana:
Product update emails
Whenever you launch a new product or feature, it’s time to send an email. These types of customer retention emails are vital because they remind your customers of the utility of your product and introduce them to a tool or product that could potentially be a game-changer for them. After all, if you’re launching or updating then it’s (hopefully) because you received customer feedback suggesting a need for something new.
In a product email, you should include your product announcement along with an explanation of exactly what this new feature or product does and how your customers can get the most value from it. Here’s an excellent example from Canva:
Triggered retention emails
We mentioned that it’s a good idea to create automated email that are triggered by certain actions, especially when it comes to at-risk customers. For instance, you could set up a campaign that sends automatically if a customer hasn’t logged into your product for a certain period of time.
You can use that email to remind them about the value of your product, catch them up on any updates that have happened since their last log-in, offer ongoing educational resources, etc. Here’s an example from Animoto:
One of the pillars of customer retention is customer support. Your goal should always be to support the customer in order to make their activity within your product the most successful it can possibly be. The happier your customer is and the more they’re getting out of your product, the easier it will be to retain them. That’s why it’s important to include support emails in your email strategy. Try to send emails that educate your customer on ways they can further leverage your product, tips for using your product more effectively, etc. And don’t forget to include a call-to-action! Here’s a great example from Food Junky:
You’re a SaaS owner but, chances are, you’re also a SaaS user. These days, most of us are. And, as a result, you’re probably very familiar with how difficult it can be to keep track of all the different SaaS products you’re using. That’s why reminder emails are so important for customer retention, especially in the SaaS industry.
Whenever your customer has an important date coming up, like a subscription renewal or the end of a free trial, it’s time to send a reminder email. The tone of these emails should always be polite and persuasive. You want to retain your customer or, potentially, even have them upgrade (especially if they’re coming to the end of a free trial), but you don’t want them to feel like you’re strong-arming them into that decision. Use reminder emails as a gentle nudge, never a shove. Here’s a prime example from TinyPNG:
Milestone emails are such a fun genre of emails for customers to receive and so refreshingly unique to the SaaS space. With many SaaS products, there’s the opportunity to track milestones that a customer has reached. When a customer has reached a specific milestone, you can send them a milestone email celebrating their achievements using your product. Emails like these can encourage your customer to keep working towards their goals — and, in the process, to keep using your product.
You can track anything and celebrate any number of customer metrics: an impressive streak your customer has for the number of days they’ve activel used your product, the amount of content they’ve created, how long it’s been since they signed up, etc. Here’s a fun example from Duolingo:
Customer engagement emails
While every customer retention email has some goal of encouraging customer engagement, these types of emails are specifically focused on engaging customers and encouraging them to use your product even more. Typically, customer engagement emails play the role of providing further value to active users by taking their activity within the product and suggesting further tools, features, or content that are relevant to their specific needs. Because of this, customer engagement emails usually involve a high degree of personalization. Here’s a great example from Netflix:
Winback campaign emails
Retention doesn’t have to stop just because a customer has already churned. That’s where winback campaigns come in. Winback campaigns involve a series of of emails designed to re-engage customers who have already churned and get them to resubscribe to your product. Effective winback email campaigns often include personalized incentives or discounts. Here are couple of examples:
Customer feedback emails
Customer feedback emails are one of the most effective types of customer retention emails. As we discussed previously, customer feedback (both positive and negative) is invaluable for retention rates. Customer feedback emails are essential when it comes to collecting this type of data. These emails allow you to keep an open line of communication with your customers. No need for anything fancy — just express how much you value their opinion and ask whether they have any challenges or questions you could help them with. Here are some examples from Nest and Groove:
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Customer Retention Emails FAQ
What are customer retention emails?
Customer retention emails are emails that are sent to existing customers with the intention of retaining them as loyal customers and encouraging them to continue using your SaaS product.
Why are customer retention emails important?
Customer retention emails can help you lower your acquisition costs by putting the focus on retaining more customers rather than having to constantly acquire new ones. Customer retention emails leverage the relationship you already have with existing customers, enhance your email marketing, and improve brand awareness & loyalty.
How do you create effective customer retention emails?
In order to create truly effective customer retention emails, you should focus on at-risk customers, build in feedback loops, make it clear how (and why) your product is valuable to your ideal customer, use clear & straightforward subject lines, and create a consistent cadence with which you send emails to your customers.