Through Darkness & Downturn

Abby Sullivan May 6 2020

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Today, a deep dive on lessons in resilience—from the minds of two software leaders who’ve successfully led their own way through darkness and downturn

 

 

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How is B2B SaaS growth trending over time?

📈7 day +0.49%     |      📈30 day +0.97%      |      📈90 day +3.33%

B2B Index 90 day-20.05.06

As it stands today, B2B SaaS revenue is steadily, yet minimally, rising—with a +3.33% change over the last 90 days. We’re seeing a change in MRR Gain, from yesterday, at -1.79% and MRR Loss at +1.61%.

 

How are churn and new revenue trending over time?

MRR LOSS +1.61%MRR Loss-20.05.06

MRR GAIN -1.79%

MRR Gain-20.05.06

Daily updates of the index can be found in your subscriber newsletter each day, so be sure to check back to see what’s up in the B2B SaaS market—for better informed decisions on market spend, sales forecasting, and growth choices.

You can also share the data with friends, colleagues, and fellow industry players that could use it right now. Send me their email address to abby@recurnow.com and I’ll get their name on the list. Or they can subscribe directly at index.profitwell.com.

Now, what's happening in B2B SaaS news?

 

A crisis offers opportunities to question and reimagine

How many times have you heard the word “unprecedented” in the last eight weeks?

I’d bet I’ve hit the triple digits (and I’m actually guilty of overusing the word myself). 

It's kind of inevitable, though, right? The world as we know it is simply… uncharted. 

And Amy Konary says we can learn a lot from these truth-telling moments for businesses. “Amidst all the chaos, after the initial reaction, a crisis offers us opportunities to question and reimagine."

But if we back up a minute... You might be wondering, why should you listen to Amy’s take?

During the last two recessions, Amy worked as an Analyst at IDC where she was responsible for data modeling and forecasting of software industry revenues. She’s essentially synonymous with “the Subscription Economy,” at present working with Zuora as the Chair of the Subscribed Institute, a think-tank for subscription execs.

And we can attest to being personal fans, after Amy spoke at our Recur conference in 2018, re: “the New Road to Revenue" (which you can watch here if you're interested). 

And below are the three lessons she's taken from her experience as a key player amid turmoil.

RecurNow-AmyKonary-Zuora

 

Subscription business models are built to weather economic storms.

It was during the dark days—namely, the last two downturns—that we witnessed the SaaS business model emerge, and ultimately dominate the software industry.

"The recession-induced inflection points completely turned around how the industry operated as the advantages of selling subscriptions over perpetual licenses became evident. In addition, while the ongoing costs of managing traditional software were unpredictable, the costs of SaaS were much more transparent and therefore easier to budget for."

 

Digital models provide advantages for customers and businesses.

SaaS applications are delivered and constantly improved upon via the cloud, playing a crucial role in growth. Subscription customers want ongoing value, and SaaS companies deliver on-demand innovation, via the cloud. This ensures that customers always have access to the most secure, up-to-date product available—relying on software rather than physical features and distribution channels, to provide ongoing value and set themselves up for resilience amid global struggle.

 

There must be a focus on innovation.

The subscription model is fundamentally built upon ongoing innovation. "During times of market turmoil, most companies make the fatal mistake of cutting back on innovation." But it's that relentless innovation that led to the birth of companies—even amid an economic recession—like Adobe, Zuora, and Twilio, Amy points out. Now is the time to double down on your customer relationships and do everything you can to provide more value and meet their evolving needs.

It all comes back to the relationship.

For more on Amy’s takeaways, here's a link to her full blog post. 

 

Chameleon x ProfitWell

I interrupt this lesson plan for a brief webinar reminder.

This one’s called Reduce Product Cancellations in a SaaS Recession. It’s hosted by the crew at Chameleon, user onboarding pros, plus our ProfitWell team, who knows a good deal about cancellations and delinquent churn

Why we care: There is not enough conversation around the not-so-fun parts of subscription, like cancellation experiences. A customer cancelling your product is a big deal and a great opportunity to learn more about the user experience. A cancel experience is an opportunity for your organization to adjust and grow.

What’s on tap (for the first 100 signups): A look at product strategies and tactics to reduce and deflect cancellations, with concrete examples of what others in the space are doing to win back at-risk customers and stay afloat. 

As I mentioned, signup is limited, and it’s all going down tomorrow—so if you’re interested, be sure to snag your spot on the list here

 

Peacetime professionalism --> wartime grit

And now, another bout of takeaways.

This time, from a differing POV—that of David Cancel (also known as DC), CEO and Founder over at Drift, the masters in conversational marketing. He wrote a blog post via Inc.com, compiling the lessons he’s extracted from leading and founding ventures amid multiple downturns.

And I find it interesting to weigh the parallels of his extractions with Amy’s (above). 

DC has led companies in (now three) economic emergencies. And he says his best advice is to change your mindset: from peacetime professionalism to wartime grit.

RecurNow-DavidCancel-Drift-Inc.com

His lessons learned:

 

Ignore distractions.

It's easy and understandable to keep your eye on the stock ticker, Twitter, the news. But right now, DC writes, we need to hyper focus on the customer and what they need, following them where they need you to go, and identifying new areas of business based on those needs.

 

Focus on your people.

DC says, as of late, he’s concluded that 99% of what makes businesses successful comes down to people. You must to take care of your people, both employees and customers, with outward transparency.

 

Forget the master plan. Adapt and shift.

“Digital customer experiences will be the sole option in some sectors for an indefinite period. Wartime CEOs therefore need to do more than ruthlessly stick with a master plan. They will need to be constantly monitoring their team members and evolving their processes.”

So what did we learn from all this? It sounds like a huge part of forging through this storm lies in prioritizing your people and iterating on your offering. But I’m also keen to hear your take. Do you agree with DC? Are you on board with Amy? We’re in it together and we want to continue learning, so please, do share. 

You can always reach me at abby@recurnow.com to discuss. (I promise, your replies won’t end up in a marketing blackhole. All responses go to me and I’m sincerely interested in your input—whether you’ve learned something the hard way, or you’re new to navigating this whole thing.) 

You can access DC's full blog post here, via Inc.com


Reminder: Subscription Stimulus Package

PSA: Your Subscription Stimulus Package is still thriving and ripe for the taking. It's an initiative we launched with 70+ other names in the space, with room still for more partnerships, to help get our neighbors back on track during a time of uncertainty for so many. 

If you're interested in up to 20% of your MRR in savings, head here.

If you're looking to partner with our crew and offer your own savings initiative, send a note to brian@profitwell.com for more on collaboration. 

Click here for the entire list of partners.

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ProfitWell featured user
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Today’s featured user is Wealth Factory, a team with a respectable (and straightforward) mission: to manufacture economic independence for one million entrepreneurs, health care professionals, and small business owners

The powers behind Wealth Factory are essentially reimagining personal finance for entrepreneurs, without sacrificing through insane budgeting standards. 

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There you have it, your May 6 episode of Recur Now. Tomorrow, we do it all again. 

Remember: this show is for you. If you have news to spread or helpful resources for our listeners, please do not hesitate to reach out to me at abby@recurnow.com and we’ll connect on ways to get it out there.

This series is a Recur Studios production—the fastest-growing subscription network out there. If you find use for this show, subscribe for more like it at profitwell.com/recur.


 
By Abby Sullivan

Content Marketer

Subscription market insights you won't find anywhere else.