What Makes Users Stick with Your SaaS?

3 minutes

Find Your North Star Metric to Enable More Effective SaaS Customer Retention Strategies


Every company has one, but not every company knows it. No, it’s not a secret office passageway, or a skeleton in the break room closet. It’s a “North Star Metric,” or the SaaS customer retention metric that shows you exactly what you need to do to get users to stick with your product instead of defecting to a competitor.

There are many SaaS customer success metrics out there, and you could spend pretty much all of your time tracking and analyzing them. Unfortunately, not all metrics have the same impact on your SaaS retention rate. To truly understand what makes users stick with your company, you need to hone in on your “North Star Metric” and focus your marketing efforts on improving it.

Also: Learn more about the North Star Metric in this dedicated, one hour Webinar.

So how do you find the North Star metric?

Start by defining your onboarding process (if you haven’t already). Take a look at the customers who successfully completed onboarding and track all of their activity for a period of time. Then split onboarded customers into two groups: those who returned to your product after successful onboarding, and those who didn’t. Finally, look at the difference in product activity between those groups. Whatever the users who returned did will lead to the North Star metric that will direct your SaaS retention efforts.

Churn retention

Souce: InnerTrends

That metric could be almost anything. For Facebook, it’s adding a certain number of friends. For Slack, it’s a certain number of messages posted in a Slack channel. You may not know what yours is yet, but once you find it, you can rest assured that your SaaS customer engagement efforts will become much more effective. That’s because they’ll be aimed at getting your customers to do the key thing that will make them stick with your product and platform over time.

If the North Star Metric concept is new to you, that’s okay. You’ve probably encountered many other SaaS customer engagement and customer retention rate metrics by now. But we guarantee if you give this approach a try, you’ll start to look at SaaS metrics in a whole new way.


The North Star Metric Webinar

I’ve given you a taste of it here, but in my latest webinar, hosted by 2Checkout(formerly Avangate), I talked about finding your North Star Metric in detail. I also walked through several case studies for companies that transformed their business by navigating according to that North Star Metric. One case study on a SaaS advertising marketplace found that buyers who opened at least four seller messages were likely to complete a transaction, showing that sometimes your metric is not under your direct control. In these cases, it’s even more important that you understand what that metric is, because you’ll have to do even more to influence it and keep customers around.


If you’re not careful to focus, you can drown in SaaS metrics and ruin your business by being distracted by ones that don’t matter.

Find out how to discover the SaaS metric customer retention metric that matters in this webinar.


This is a guest blog post by Claudiu Murariu, a data analyst expert who helps SaaS companies expose user behavioral patterns that can be used to increase customer engagement.

More about Claudiu here.

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