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How to approach customers about transitioning to SaaS model

When transitioning to subscription model, your existing customers are your most important stakeholders. Make sure you take the right actions to help them through the process to retain as much loyalty as you can. Learn how.
Niclas Lilja
By Niclas Lilja on April 13, 2018

When making the leap from traditional software company to SaaS subscription model, you need to take your existing customers into consideration. Without the proper change management for your customers, or enough time and support to help them through a transition, you may risk losing some of your most loyal base. When it comes to making the change, start with talking to your customers to get feedback, run your offerings side-by-side for a period of time, and give your customers great options and value for being loyal.

Transitioning to SaaS Model: Talk to your customers about the change

It probably goes without saying, but making a major organisational change without the proper notification to your customer base can be disastrous. But you'd be surprised how many companies think that implementing a change that is meant to improve their customer's experience is easy.

When making the transition, there can be a lot of question marks, especially for those who are reliant on your traditional software model, and apprehension may be high. Because of this, talk to your customers. Give them plenty of opportunities to ask questions, express concerns, and even give feedback about what they would want or look for in your new offerings. This can be the best insight you can get into what your new model should look like, and what your pricing tiers should include.

By doing this you can also create a better environment of trust, and in fact strengthen your relationships with customers. By approaching them, you make them and their opinions feel valued. Then you can also make sure they have all the materials and assistance they need to make the switch.

Make the transition slowly, instead of all at once

If you change your offerings from traditional software model to subscription model overnight, you are effectively pulling the rug out from under your existing customers. Give them the time they need to make the transition. Depending on what your business is and your offerings, they may need to alter and adjust some of their own major internal processes to accommodate your new model.

By offering both the traditional software and subscription options together, you give your customers the freedom to change over when they are ready. It can also allow for some onboarding or trainings with the new programs, so that everything goes smoothly when the switch does happen. Think about it this way: would you rather spend time beforehand helping customers transition smoothly, or transition quickly but end up managing multiple customers who end up in crisis mode when they don't know how to work your new systems?

By offering both options for a period of time, you can ensure that you're also helping your existing customers understand the subscription offerings, and can assist them in making the right choices for themselves.

Give your customers something for their loyalty

A change in business model often presents itself as a good opportunity for many existing companies to jump ship. As they need to make the choice of staying or finding another option (if there is one), they can be tempted to use the latter. But if you are good to your customers, they will be more likely to be good to you.

Here you can be in a position to offer them special introductory rates for their continued loyalty and support. Or perhaps they can receive dedicated account specialists who will be there specifically to help them make the most of the software. Discover what may be most appealing to your existing customers (by talking to them!) and learn how to articulate the ways that they will benefit by continuing their partnership with you.

If you put yourself in your customers' shoes and think about "what's in it for them?" you can be in a better place to lure them into staying with you through the change.

Any company's transition from traditional software model to SaaS subscription model wouldn't be successful without existing customers sticking around. To make sure you can achieve this, you need to in some ways put their needs first, and understand their fears and apprehensions and address them accordingly. So talk to your customers to get feedback, make your transition slowly by running old and new offerings simultaneously, and give your most loyal customers the best value you can.

Want more information about making a smooth transition from traditional software? Download our White Paper: Best Practices for Transitioning to a SaaS Subscription Model

Download the White Paper

Published by Niclas Lilja April 13, 2018
Niclas Lilja

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