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Reducing churn in data management SaaS companies: a case study

Apostolov, Nikola (2020) Reducing churn in data management SaaS companies: a case study.

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Abstract:Data management Software-as-a-Service (SaaS) allows companies to utilize state-of-the-art data management solutions through a cloud on a subscription basis. These services provide the opportunity for firms to become data-driven and better understand their customers, internal processes and market trend, in order to transform data from non-active to competitive advantage. Cloud computing has transformed the industry through allowing IT cost reduction, operational elasticity, faster upgrade cycles, and ease of implementation, but has also unfolded various challenges. As firms could easily start utilizing a data management SaaS, they could also easily terminate their subscription in the end of the month. With the growing competition, customers could switch from one provider to another based on performance and price differences. Therefore, providers need to prioritize on creating long-term relationships. This paper focuses on studying the main reasons for churn in a case study data management SaaS provider. The findings showcase that the largest population of churning customers are those which had expectations which were not met. Therefore, the sales process was closely studied, in order to establish that the accomplishable results promised by salespeople are highly dependable on customers’ characteristics (size, devoted time, IT skills) and input. It was recognized that salespeople spare key information regarding the characteristics customers need to possess, in order to push sales when challenged with reaching personal targets, leading to clients having wrong expectations and eventually churning. As salespeople engaged in such actions because they were not accounted for churn, this paper recommends that data management SaaS providers need to assess salespeople performance based on customers acquired plus those which did not churn for at least six months and not due to unachieved promised results. Through applying this method, salespeople would be more transparent towards their potential customers through providing personalized expected results and underlining the fact that data management SaaS is a self-service platform that requires time and resource devotion, in order to achieve results.
Item Type:Essay (Master)
Faculty:BMS: Behavioural, Management and Social Sciences
Subject:85 business administration, organizational science
Programme:Business Administration MSc (60644)
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