How to Use Data to Reduce Churn and Double Revenue

I plan to double revenue this year. $7M to over $15M ARR.

But there's a problem: Churn
As I ran the numbers, Churn will get out of control.

So I turned to data and found a solution: a winning segment.
And I'll share in detail how we found it!

Here's the step-by-step guide:

— adriane schwager (@aschwags3) April 11, 2023

In this thread, I'll show you in great detail how we did it (and how you can do the same). Lots of screenshots and some of our real data & findings.

I didn't use a fancy BI tool - just GSheet and our CRM.

Follow along and do the exact same exercise for your business!

— adriane schwager (@aschwags3) April 11, 2023

1) Select core KPIs

The first step is to choose the KPIs you want to compare different segments by. Don't overcomplicate it; pick the 3 most important metrics in your business.

Write them in a GSheet / Excel.

It should look something like this: pic.twitter.com/RMPzdSYSaP

— adriane schwager (@aschwags3) April 11, 2023

For GrowthAssistant, we looked at:
- CVR Lead to Customer
- Churn Rate
- Avg. Revenue per User
- Subscription Length

So our table looked like this: pic.twitter.com/UkDj7KW17i

— adriane schwager (@aschwags3) April 11, 2023

2) Find suitable "categories"

Now let's talk about the "categories" we want to analyze. Those are just characteristics you can group your customers by.

Common ones are:
- Level of Funding
- Amount of employees
- Industry
- Lead Source
- Job Title
- Location
- ....

— adriane schwager (@aschwags3) April 11, 2023

This is very company specific.

Check your CRM to see what data you already have available.

You can also manually backfill data. Some of our leads / customers did not have the field "Employee Count" filled in. So we used LinkedIn to manually backfill the data.

— adriane schwager (@aschwags3) April 11, 2023

Again: keep it simple! Start with 3-5 characteristics you think might have a big impact. Ideally, you have most of the data for them already.

For us, it was:
- Funding
- Lead Source
- Amount of Employees

— adriane schwager (@aschwags3) April 11, 2023

3) Break categories into multiple segments

For funding our segments looked like this:
- No funding
- $0-$5M
- $5-$25M
- $25M+

There's no right or wrong.
Just balance each segment out - if 70% of your customers are in $5M-$25M, break it into smaller steps!

— adriane schwager (@aschwags3) April 11, 2023

Here's what it looks like for us (with fake numbers).

Noticed the new column "Share of all customers"? This is important to see your distribution of all (churned + active) customers across the segments.

Once again: if your segments are too small or too big - just change them! pic.twitter.com/dgiHyuqppU

— adriane schwager (@aschwags3) April 11, 2023

4) Calculate KPIs for each segment

Now it's time to use your data for some insights:
Export your leads and customer from your CRM. Cluster them into the different segments (in this case by amount of funding).

Calculate your CVR from Lead to Customer (or whatever KPI you chose): pic.twitter.com/1ly9oUnVkA

— adriane schwager (@aschwags3) April 11, 2023

5) Clean up data

Beautiful. Let's clean it up and add a little hack.

Since I am interested in the differences between the segment, I just compare them to the average: pic.twitter.com/JFF9EiIZ35

— adriane schwager (@aschwags3) April 11, 2023

6) Roll out across KPIs

The segment of $0 - $5M in funding is looking good. But it's just one data point and likely too early to drive a conclusion.

Let's get going and do this exercise for each KPI. pic.twitter.com/X5LsWUdD0T

— adriane schwager (@aschwags3) April 11, 2023

It's looking good.

Some first insights:
1) We struggle to convert the "No funding" segment, but once we do they are sticky
2) $0 - $5M seems to be a good segment

But we are just getting started!

— adriane schwager (@aschwags3) April 11, 2023

7) Roll out across categories

We got some insights after looking at "Amount of Funding". But now let's do it for the other categories:

- Funding (done)
- Lead Source
- Amount of Employees
- ...

— adriane schwager (@aschwags3) April 11, 2023

Important:
Sometimes the insight is that there is nothing to see here.
Looking at different Lead Sources provided no new learnings for us.

But sometimes, you hit gold.

That's what happened to us when we looked at "Amount of Employees". Here are our findings with real data: pic.twitter.com/GHuDj46GuP

— adriane schwager (@aschwags3) April 11, 2023

Imagine the impact an insight like this will have on our business.

You would stop investing time into "Segment 1".
"Segment 3" would be getting the VIP treatment.

All efforts would move into getting more "Segment 3" leads!

— adriane schwager (@aschwags3) April 11, 2023

8) Summarize findings

Do this across all categories and then break it down into the core finding.

Keep it as simple and short as possible.

Here are our real main findings: pic.twitter.com/opYfLAfolC

— adriane schwager (@aschwags3) April 11, 2023

Sure, some of this can be summarized as "the bigger the company the better". But seeing the differences was eye-opening.

Who knew that "employee count" is the most predictive metric to judge quality for us?

Our whole approach as a company shifted. We implemented scoring etc.

— adriane schwager (@aschwags3) April 11, 2023

With those changes, we'll double our revenue this year again!

All of this (backfilling data & data analysis) was done by our Data Analyst Growth Assistant.

He built most of our reporting and Hubspot workflows which made the whole task easier for him.

— adriane schwager (@aschwags3) April 11, 2023

That's a wrap!

Here's the summary:
1) Select KPIs
2) Find "categories"
3) Create segments within categories
4) Calculate KPIs per segment
5) Clean data
6) Roll out across KPIs and categories
7) Summarize learnings

I hope that...

— adriane schwager (@aschwags3) April 11, 2023

... this step-by-step guide helps you to uncover similar insights about your business.

Everyone is talking about being "data-driven".
Well, now you know one way to use data to drive actions.

— adriane schwager (@aschwags3) April 11, 2023

Enjoyed those insights? Follow me @aschwags3 !

I’ll be sharing lessons about leadership, global remote teams, and entrepreneurship I learned from growing@growthassistant to $7MM and beyond.

— adriane schwager (@aschwags3) April 11, 2023

The goal for this year? To reach $15M in ARR. 100% bootstrapped.

How?
By finding the BEST offshore marketing talent for companies.

If done right, it feels like magic. Value and ROI are crazy.

And with GrowthAssistant we are making it easy for you to experience the magic

— adriane schwager (@aschwags3) April 11, 2023

I am convinced every company would benefit from GrowthAssistant!

Experienced, full-time offshore talent to take on all your design, reporting, outreach, and ad management tasks.

Head to the website to learn more and join the waitlist:https://t.co/4yQgFugYv0

— adriane schwager (@aschwags3) April 11, 2023