Let's celebrate my first churns
November was a tough month for me. Two paying customers churned, and one downgraded to a cheaper plan.
Of course, as a perfectionist and imposter, I instantly thought that the problem was in my product. I reached directly to churned customers to understand what happened. And I was surprised by their response.
Reach out for feedback
I couldn't imagine writing an email to churned customers a year ago. But it happened. I wrote three emails in November and received a response to each of them.
And the reasons why the customers unsubscribed:
- One of them temporarily needs to generate screenshots and may subscribe again. I will consider adding a pay-as-you-go option or a yearly plan.
- One of them has built MVP with a screenshot feature, but after rebuilding it without and don't need to use the project anymore.
- And the one that downgraded changed how they use screenshots so that it helped to reduce the number of screenshots rendered monthly.
Nobody mentioned that my product had bugs or that they weren't pleased to use it. It was the opposite. They applauded the product and were deeply satisfied with it.
People are friendly and responsive. Many might not answer, but you need to try anyway.
I might automate the process in the feature to collect feedback on churn.
3 lessons
Attachment to MRR hurts
Internal deep attachment to the MRR number is not sustainable and negatively impacts my mental health. I haven't found a solution to it yet, but Satvik Pendem (@satvikpendem) gave me a direction to consider:
Focus on those who pay
A churn is not a positive or negative event. Treat the churn as a point of information.
In my case, all these churns don't tell me how I can improve the product and serve my current paying customers better. Maybe, I might change the pricing structure and billing approach, but I don't know need to test.
I will second the advice that Val Sopi (@valsopi) shared with me. While analyzing churn is good until it is about your product, it is much better to double down and what works and try to satisfy your current paying customers.
Ask for testimonials
Yes, a customer is gone. But as I shared earlier, the customer can return later. So, try to stay in touch with them.
In addition, if you haven’t done it earlier, you might ask about testimonials. If satisfied with your product and service, they might leave you a good testimonial.
That might help you attract and convert visitors into friends and customers.
Afterthought
Not everything goes as you wish. If your growth doesn't have dips, it is not growth at all.
Hey Dmytro! Thanks for sharing, I recall a couple of advices from YC people. If memory serves, one of the advices was to analyze how often do your potential customers have the problem your product solves — and aim for those having it more often.
If I was going to find with a use-case where your product could potentially be used frequently, I'd come up with something like frontend QA automation which makes sure that the website design looks the same in different browsers by making screenshots and comparing them with reference ones, and also makes sure nothing is broken after a new release.
As I'm working on a product for API monetization, I'm extremely curious: how did you implement billing and subscription mechanism for your API? How long did it take?
Thanks a lot for your advice and reply. You keep me motivated to share my journey.
QA automation usually has systems to detect changes. But that's a good direction to consider. If I can cover monitoring of changes for small business owners, yes? But I build an API, not a monitoring tool, and that's one of the problems of my product that I need to solve. I plan to build more tools around API to showcase it and to make a bit of money if possible.
Marketplace, template or API hosting?
I use Paddle, and it took me about 2 weeks to integrate billing.
...decades later 😄
I mentioned QA automation as a potential direction for sales efforts, building a change detection tool for sale could be a risky investment without prior market researches.
Thanks for the answer! I work on a monetization engine with the following philosophy: the only thing a developer needs to do in order to start selling an API, is to write the API code.
Basically, API developers would get a big "Subscribe" button which, when clicked, onboards a new customer and lets them use the API according to the subscription plan, tracks usage and collects payments.
All the following should be handled by a tool with zero integration efforts: subscriptions, user management, access tokens, subscription plans, quotas, rate limits, usage tracking, billing, invoicing, payment collection and self-service checkout for customer onboarding.
So no more boilerplate code like
stripe.createUsageRecord()
or
if (currentCustomerOrderCount >= subscriptionPlan.maxOrdersPerMonth) {
return HTTP.Forbidden;
}
All is done by the SaaS.
How would such tool affect your work, if at all?
Your tool would have helped me to start faster, of course. But I already have a boilerplate.
As somebody who loves building APIs, I do love the idea and even own a domain in that niche. Go for it.
Have you tried to speak with potential customers?
Thanks for your answers! May I ask you to play around with it? Please be as ruthless as you like.
https://www.projectx.biz/
Thanks for sharing! It definitely hurts when you have few customers and they churn no matter the reason. But it's more reassuring to hear it wasn't because you did anything wrong.
Then again, if it was because something with your product they disliked, then that would mean the churn is in your control, which could be additional motivation.
Yes, paradoxically, it looks like win from any perspective!
Thanks for sharing Dmytro!
Thanks for reading 🙏 It helps me going further.
This is so kind of you to share, Dmytro. We're always seeing the good things that happen in a startup. But I love how you've dissected the incidents. And it feels better when a customer tells you why they churned.
Thanks, Gotham. Yes, I would think that the problem is with my product.
What are the excellent entry points/events/triggers to collect testimonials?
Good question, Dmytro. The tested entry points which worked well for my customers
Thanks a lot, Goutham!
By the way, two people asked me about an affiliate program, but I haven't taken it seriously. At least, I could have asked about the testimonials.