Dear SaaStr: A big customer payed for a year but doesn’t use the product. Should I just mark them as churned?
No. Don’t necessarily count a big customer out that hasn’t deployed … yet.
Instead, what you should try to do is renew them, especially in the enterprise. Go help them actually deploy the software. After all, they likely spent months evaluating it and piloting it. And in many cases, years deciding to make a big business process change. It takes time. Sometimes, longer than the customer had planned.
I’ve had many customers, especially big old customers, get excited, plan and buy … and then for internal reasons, deployment just got pushed out.
Many of them never used the product at all in Year 1. Yet, almost all (several brand names) renewed!
Why?
- First, they’d already budgeted for it. So the renewal was still realistic.
- Second, they still wanted to make the business process change and had picked their vendor of choice. So why change, even if deployment was delayed?
- Third, sometimes they just got ahead of internal resources. They didn’t end up having an internal team to deploy the app, but they still want to.
So yes, it’s a big bummer when a larger customer buys but doesn’t use.
But that may only mean … Not Yet.
Treat them as a much more realistic renewal than your gut tells you. Keep checking in and seeing how you can help get things rolling. Don’t hide from the lack of activation. That doesn’t help.
And just go out and ask them what you can do to help to speed up the deployment.
