Ujjal Kohli from Preact: Using Data to Predict When Customers Might Churn

While it takes a certain level of trust and assurance to get customers to willingly give you their personal information, they may already be providing you with valuable information with every login, click or download. Information that may help you extend them being a paying customer, and even assist you in selling them more goods, and more expensive services.

Ujjal Kohli, CEO of Preact, a cloud-based customer success platform aimed at helping software subscription services reduce customer churn, joins to discuss the importance of using systems to predict future customer behavior based on actions and activities – and then using that knowledge to better address their needs. (This transcript has been edited for publication. To hear audio of the full interview, click on the audio player at the end of this article.)

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data to predict when customersSmall Business Trends: Can you tell us a little bit about your personal background?

Ujjal Kohli: I spent about seven years in the mobile phone business as EVP of sales and marketing for a very large mobile operator in the 1990s. Subsequently, I’ve done two successful startups. One in the networking space that went public. And another in the advertising space that was sold last December. So this is my third startup that I’m leading as CEO.

Small Business Trends: Can you give us a little information about what Preact does?

Ujjal Kohli: Preact helps subscription businesses proactively manage churn and up-sells their customers. And we do that through the use of very sophisticated, predictive analytics, machine learning and analysis of the signals picked up from customers, combined with the expert intuition of the customer’s success gene.

Small Business Trends: How do you think companies are leveraging the information received to extend the relationship?

Ujjal Kohli: The best companies are combining the use of predictive analytics and expert intuition to use their information. Many companies, however, are really not using this information.

The good news is that artificial intelligence has come a long way. Big data has come a long way. We now have cost effective technologies to capture it, to store it, to retrieve it quickly and most importantly of all, to analyze it for insights. For example in our case to say, ‘Hey, this customer of yours doesn’t look like they’re in good health. You better take some proactive action, otherwise they are likely to churn.’

Small Business Trends: Can you talk a little bit about the different data points you are tracking from the churn and opportunity perspectives?

Ujjal Kohli: The analysis of individual user usage, we think, can get the greatest insight. That, of course, is an enormous amount of work for our computers to be studying the individual click stream of every single user. But you can have much better results.

As an example, rule-based systems might say if someone hasn’t logged in for seven days, maybe that’s a red flag that the account is not using your system and may churn. We don’t do that. We go, ‘Mary tends to log in every day. If she hasn’t logged in for three days, maybe that’s a red flag. Joe on the other hand logs in every other week typically. So if he hasn’t logged in for four weeks, maybe it’s a problem’.

So it’s a much finer grain analysis that tells which features are getting used, which ones people are getting stuck on, and which accounts are getting value from your system.

But that’s not the whole story. You also get what I call account-level signals such as, are they slow paying their bills when they used to be pretty much on track? Is their contract coming up for renewal? Has your main sponsor at the company just left the company? Or maybe there’s been a reorganization and they’ve moved on to something else. So those are account-level signals. They can also provide some good insight into what the account is likely to do.

Small Business Trends: Being able to access that kind of information and provide opportunities to help or lead at the individual level are incredibly important. But I guess also at a higher level, you’re actually able to see certain trends that are taking place in customer segments as well.

Ujjal Kohli: Yes. You can see, for example, which features get the most usage, which features could be extremely valuable to a certain customer, etc. That can give you a tip that maybe you need to onboard them better in the future or maybe send them a video or an easy tool.

Small Business Trends: How does a service like yours help to fine-tune the whole process of going from website visitor, to signing up for a trial, to converting all the way through to a customer?

Ujjal Kohli: Because we’re looking at individual user activity, we can see which of your free trial customers are using the system substantially, benefiting from it and are active and, therefore, prime candidates to convert to a paying customer. People can have a lot of free customers and it’s expensive and a lot of effort to pursue all of them without insights about which ones are the best prospects to convert. So what Preact does is give you an insight to which ones are the best prospects to convert so you can efficiently and effectively use your marketing and sales resources to reach these people.

Small Business Trends: Let’s talk about what a company has to do from a cultural standpoint in order to be successful with implementing this stuff?

Ujjal Kohli: I think to keep customers, reduce churn and up-sell, it requires a CEO and company-wide commitment. Deploying of tools like Preact is one thing. But there’s many other aspects of management that have to be right. You have to have an empowered and properly trained, motivated and incented customer success team and systems that do outreach automatically.

Metrics and dashboards are very helpful. If everyone can see what the numbers are and what the trends are, that can be pretty effective. And so some of our best customers have TV screens in their offices showing churn and up-sell results. And they are tracking them in real time, day by day. Everyone in the company can see how they’re doing. So I think that’s the kind of level of commitment that it takes so you have an empowered team.

Small Business Trends: Where can people learn more about Preact?

Ujjal Kohli: Our website, Preact.com has a lot of information.

This is part of the One-on-One Interview series with thought leaders. The transcript has been edited for publication. If it's an audio or video interview, click on the embedded player above, or subscribe via iTunes or via Stitcher.

Brent Leary Brent Leary is the host of the Small Business Trends One-on-One interview series and co-founder of CRM Essentials LLC, an Atlanta-based CRM advisory firm covering tools and strategies for improving business relationships. Brent is a CRM industry analyst, advisor, author, speaker and award-winning blogger.