Ep. 171 - Why the SaaS Journey Doesn’t End at Checkout

Guests: Ken Rapp (Co-Founder & CEO) and Emily Lagasse (VP of Marketing) of Bluestream

What if the key to SaaS growth isn’t more leads, but fewer customer drop-offs post-purchase?

In this episode of SaaS Backwards, we sit down with Ken Rapp (Co-founder & CEO) and Emily Lagasse (VP of Marketing) of Blustream, the platform pioneering post-sale engagement, to explore how product ownership experiences are unlocking revenue, retention, and lifetime value.

According to Rapp and Lagasse, most brands obsess over acquisition, but lose up to 70% of customers before the second purchase. Blustream flips that script by transforming post-purchase silence into an intelligent, AI-powered dialogue that guides customers through onboarding, usage, care, and reordering.

Key takeaways include:

📦 Unboxing is a retention opportunity
🤖 AI predicts drop-off and upsell moments
🛠️ Don’t launch on platforms too early
🎯 Vertical focus beats “sell to everyone”

If you’re a SaaS CRO or CMO looking to drive net revenue retention, boost repeat purchases, or reimagine how post-sale moments can be monetized, this episode is for you.

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Transcript

Welcome to SaaS backwards, a podcast that helps SaaS CEOs and go to market teams to accelerate growth and increase profitability. Our guests today are Ken Rapp, co-founder and CEO, and Emily Lagasse, VP Marketing at blustream. An intelligent adaptive messaging platform that sends personalized automated messages to product owners at exactly the right time.

Ken Lempit: Consumer product and service companies use it to create product experiences that drive revenue, retention, and long-term value. Emily, Ken, welcome to the podcast. Thank you. Before we dig into this great topic I'd love for you, Ken, to give us a little bit more about the company. It's, reason to be and your background, and then we will ask you Emily to do the same.

Ken Rapp: Great. Well thank you so much for having us and , yeah, it all started with a cracked guitar. Is where, maybe I'll say it. So, you know, I'm a guitar player and some of our co-founders are and in a cold New England dry winter one of our guitars cracked, actually, a couple of us have cracked guitars.

And we asked ourselves, why did that happen? And it was because the humidity around October, November, here gets very, very dry and the guitar was in distress and never even, we had no, no connection where the guitar was telling us it was in distress. And we said, boy, that's interesting. What if that guitar could have talked?

What if it could actually have communicated with us, and I'm a pretty experienced guitarist, but I had never had that brand and told, told me what was going on. I certainly would've prevented it from having a problem. And that led to the concept of,

boy, I got a lot of communication pre-sale. We all as business leaders, have invested in CRMs and campaigns and making sure we're getting to buyers, and then our websites are beautiful and we have e-commerce stores, and then you have direct to consumer so that the package is purchased and it, and it's shipped.

We even know that it shipped and when it, when it's delivered to the door. But then, then we're just disconnected from our customer for that ownership experience to unbox it, learn about it, onboard with the product, use it, take care of it, and maintain it. The only time we might reconnect back to the company that we bought the product from is normally when we have a question or a problem.

And usually that's good if we do reconnect 'cause we have a problem 'cause the company will fix it or it's not so good if I have the problem and don't even continue and tell my friends I had a hard time with it. And so we said, what if there's this ability to create dialogues and interaction and a connection for that consumer or customer of a brand of a, of a retailer, of, of a brand, that would be an ongoing conversation around product ownership.

And that's really what we're so excited to be working on out in the market. So it all started with a crack guitar and now it's well beyond music and wellness and, pets and, and other things. So looking forward to having a conversation today. 

Ken Lempit: That's awesome. And Emily, could you, share just a little bit about your background please?

Emily Lagasse: Absolutely. So I've been the VP of marketing at blustream for the past three, three plus years. I came in at a very exciting time. We were making a pivot, getting ready to launch our current platform, and that's my favorite space to play in. You know, I was an entrepreneur before joining blustream.

I had two businesses of my own and my favorite space is going from that zero to one launch. And getting something out there. So it's been a really exciting three years and looking forward to talking today about everything we've been doing and learning about. 

Ken Lempit: Well, this is a fascinating topic, and Ken, we're gonna have to talk a little bit about musical instruments after we're done here.

I've got some background there as well. But, um, let's talk about the blustream story and let's talk about the early days, the journey from RnD to getting to a product in market. What were the early challenges you faced in developing the product? And how did you realize that the initial product you built for Shopify wasn't doing the job, 

Emily Lagasse: You know, I think 

as category creators and product experiences, you know, we were initially trying to figure. Make our way into the industry and get early adopters onto the platform. And we saw, you know, we had the Shopify integration for existing e-commerce businesses for our clients to help them integrate.

And we said, we have this integration. What if we were to kind of take a piece of that, you know, specifically focus on the unboxing and the first impression that a customer has. And have this focused entry point for more e-commerce businesses. Let's try and get out in front of as many e-commerce businesses as we can and use the Shopify at Marketplace as

another sales channel and ultimately, you know, we attracted a lot of pre-revenue and very early stage e-commerce and they were looking to experiment and test different apps, which is what a lot of e-commerce businesses do because Shopify, the Shopify app marketplace makes it very easy to do that. And I think really ultimately there was, a bit of a mismatch in the ecosystem between what we were offering and, you know, which still required a conversation with our team and what people were looking for in the marketplace. So, you know, ultimately we, we realized we were getting traction and higher touch opportunities. And we still have our Shopify integration, which serves many of our clients very well, but we don't focus heavily on the Shopify app that was focused on that unboxing experience as much anymore 

Ken Lempit: And so who are the ideal customers for blustream? 

Emily Lagasse: So, you know, any product, physical products that get delivered to someone's home that need someone, that consumer needs help with that product. So it could be any product that's sold really. E-commerce, Ken mention pets, musical instruments, wellness.

You know, you think about products that you received yourself, that you get and you think, gosh, I really wish I had somebody here to help me understand how I set this up, how I can best use it. Do I need to clean it? Do I need to purchase something else to use this even better? You know, so just all the touch points around products that you purchase.

Ken Rapp: , the Shopify launch, when we first started, we weren't ready. And so maybe there's some wisdom there about when to do what. I'm, an entrepreneur that really loves solving unmet needs, and this is an unmet need in between customer acquisition and customer support,

is product ownership and there really aren't a lot of alternatives out there to connect with your customer around product ownership. And we thought that Shopify, as Emily said, was a great ecosystem for blustream to really help lots of companies out there who need this help, but our technology

It wasn't ready. We needed to learn more from the first early adopters about exactly what their needs are. I'm a big believer in get on the field of play and try things, learn and then adjust and get closer to the center of the bullseye. And so, Shopify still was successful for us because we learned not to be there early, but we got some customers and they worked with us.

And then as we've gone forward, it's our job to invest in our product and technologies to make it easier and easier to adopt, which is where we are now with our journey builder. We've just launched into the market back at the end of May, which allows a company to load in their company brand and a product and our AI and our experience with the connections out there with our existing

hundreds of thousands of customers. We look at all the cadence and content and when to deliver what message, and we bring that together with all the content that business or brand has, and provide a journey that's a, a set of dialogues between a company and their customer that will engage them and get them really to be emotionally connected.

And our job is to help you get more, best customers that that's where we're at. We just weren't ready three years ago when we saw the vision. But the reality was we needed more interactions with customers. 

Ken Lempit: so it sounds like you had to handhold a lot of these folks and a little bit of mea culpa on being ready to go as they were working through the bugs with you, or the bumps, I guess more like 

Ken Rapp: the bump.

It's not a straight line, you know, and what's marvelous is most companies. and people are very happy to join a vision and go on the sort of journey together toward building something new if it brings value and you can demonstrate the value. And in the early days, if we're just transparent about that, that's great.

The problem on Shopify is, as Emily said, and Emily, you're a user of Shopify. Your prior gigs when you, used Shopify as a e-commerce site, you needed something quick to go and have it fully baked so that you could just turn it on and run. And we needed, as a business and a company at that moment, we needed customers who would collaborate with us on tell us what's wrong, what we're really solving here.

Ken Lempit: So fast forward three years later, you know, we have a amazing business now, but we weren't ready then. It's a great lesson in right time and right tool. Or wrong time, right tool. yeah, sounds like, early adopters needed a more handheld approach, right? That's sort of the, the learning there.

I wanna move on to another topic, that we planned here and, and you guys mentioned in our prep that 70% of customers don't make a repeat purchase. That seems like a terrifying prospect. Especially if there's any consumption associated with the product. So how, how did you develop those, uh, that product experience journey that you mentioned to address this retention issue?

And where's the innovation that you're bringing to help customers stay engaged after that first purchase? 

Emily Lagasse: I think when you zoom out and think about the customer journey, you know, we've talked about this box arriving on your doorstep. It's kind of like this black hole moment for the company not understanding what's happening with their product.

And you know, first and foremost, I think it's really. There's this huge opportunity, right? 70% of customers are not coming back for a second purchase, and the opportunity is to engage with that customer when they get their product, help them learn how to use it, help them learn how to enjoy it, help them learn about other products you may have that compliment that product, and so really understanding their whole journey with your products and their experience and who they are.

Mapping those points, understanding where they may fall off. And that's what our team has been able to do is really take our data lake, take all these points of data that we have from other product experiences of people on our platform, and the help of AI, understanding where those common points are, and helping customers have an excellent experience building that loyalty.

Ken Lempit: So I, I wanna dig into that just a little bit. 'Cause there's a huge amount of noise about AI and a lot of garbage content being created by AI too. But, um, here we have a really interesting and novel use for AI. The sort of consistent with what I feel is the true higher order value. So you're taking an amount of data that no human could really get their arms around, right?

Drawing conclusions from analyzing it with these tools. So I'd love you to just get a little bit more into the kinds of information that are available to your AI and what it's really putting out as a result. 'cause this is where I think the true value of AI and the innovation around AI is possible.

Ken Rapp: Yeah, excellent question. And by the way, we're frightened by AI in real life. We have a very conservative and deep respect for how to use it. What we're doing with the AI is under the covers, you know, very controlled monitoring, all the interactions and knowing the, the averages and the high potential cadence. What is the cadence of a journey?

For a consumer married to their next purchase because they've built trust, how do you build that significantly high net promoter score because the consumers love what you're providing? It's when it's product centric, it's not promotional. It's all about helping build trust. You have a new channel as a business and if youcan continually refine the cadence and content and, and make it super relevant to your consumer.

You've built a channel where the, the, you know, it's 10 times harder to get a new customer than to keep the one you have. you now have a customer buying.

And so we use AI really in two places. One is to make sure that we're helping our client brands. Know the best cadence and content at the right time on their journey.

And the second is there's another whole topic on AI around the natural language processing that's more familiar to us. When we, we call and we get an agent that, you know, is an AI agent, or when you go and search with ChatGPT on a particular topic and get some great answers. What we do is we see customers occasionally they, they literally believe that and it feels like there's a human on the other end of the line helping them with their product.

So once in a while they'll ask us a question out of the blue, and that's a great example of where AI can be helpful if we digest and assess their question or their comment and then provide our client with an answering system of A, B, or C from the client voice, not AI giving the answer. But AI helping determine which is the best of the three to five answers our client wants to give.

I think it's a good time to kind of shift our gaze to go to Market for blustream itself. I'd love you guys to walk me through how the marketing strategy has changed. we talked a bit about early marketing, but really only the channel that you were using. So I think it might pay to kind of look back a little bit and then talk about what we're doing today that's working.

Ken Lempit: So, um, if you guys could shed some light on, initial go to market couple, few years ago and take us through to today, that would be awesome. 

Emily Lagasse: I think back to that time when we were. You know, talking to everybody, learning a lot and working on our marketing messaging and figuring out who our ICP is and you know, when you have a platform that solved the problem of retention for CPG and subscription, that's huge.

Right? That's a huge ocean there. And trying to figure out the specific use cases and verbiage and messaging that we needed to use for each of these kind of specific cases within was really important. And so it required a lot of, conversations and learning on our part. We were fortunate early on to partner with folks in specific, verticals that really

saw our vision and aligned really well with us and helped us grow within those verticals. And that was a key driver to our success. But really once we were able to hone in on. these specific verticals and the messaging within and the channels within, and understanding what content needed to happen within those verticals and what events to attend, what webinars to put on.

It really helped us grow within these verticals and become experts in those verticals. And we just continue to add more and more pillars from there we're using the same strategy, 

Ken Lempit: Just to reiterate, so you had a more broad based, almost anybody could be a customer, and now you have a specific set of verticals.

Where did you start? 

Emily Lagasse: Well, we started in a few key areas, but I think the place, and Ken, correct me if I'm wrong, but I think really the place where we really gained the most traction early on was in the music industry specifically school band and orchestra rentals. And I think that was in large part because of the excellent partners that we had in that channel and the specific use case that we were solving that no one else in their industry was.

Ken Rapp: Yeah, it's a great example. So, and we feel very, very lucky and proud of that space. So being a musician myself, think about school, band and orchestra. a great point here is there's a difference between buying a guitar and being a beginner guitar player, or even buying a second or third, or

don't tell my wife my 10th guitar or whatever. but there's a difference between buying a new guitar and being a student in the rental business and the rental business for blustream our customer base just took off. And the reason is most businesses who rent instruments to fourth or fifth graders and, school being an orchestra, they get a customer to sign the contract and pick up their instrument at the beginning of the school year.

And then they would check in and hear from a teacher if there was somebody who had a problem or returned it. They wouldn't hear from that giant group of, thousands of kids until the end of the school year, and they had a churn problem, just like most subscription businesses do. Most repeat sales problems we talked about earlier.

They had the same problem but it was over a very long period of time because they didn't know what was going on with their students. But the, the answer is the same across the board, 50% of the students didn't go on to year two, roughly. some higher, some lower, but 50% is the number. In that space, by engaging that renter about a new alto sax and teaching them how to play and how to put the strap on, on day one the student's parent is getting the messages and they're working with their child on

all these wonderful things about the instrument. Did you know these are the pieces of a clarinet and do you know that you need reads? And what the use of a read is? And all the businesses we work with have wonderful content on their websites, but it sits there. And when someone's first gonna buy something or rent something, they go, there's a lot of interaction.

But then once they rented or bought the instrument, it stopped. What we found is out of all of those students that we're going to drop off at the end of the year, we see a 30 to 40% reduction in churnof the quitters across the board.

Some lower, some higher, but it's right between 30 and 40%, which means right now there are tens of thousands of kids out there playing a second year that wouldn't have been playing a second year because of blustream's interaction. So that then led to, well wait a. If, and the, well, let me back up. The revenue impact, let's just say an average rental is 50 bucks a month for 10 months.

You're talking about a $500 a year business per student times thousands, that you're losing half that, that amount of customers and have to make it up again with CAC, by investing in new customer acquisition. And so. we're not the smartest people on the planet, but it's pretty obvious if you can reduce the churn in a long, you know, school year process.

Maybe there's other businesses who care about churn and want to get repeat sales. And so we started looking into the subscription economy and the CPG space and started getting some early adopters in those areas. Now that's where I was saying, I think you asked the question. If we look at our go-to market now, compared to where we were back then, we're now going into the wellness space.

CPG subscription economies really focused on helping people in their health and pets in their health. And that's a repeating recurring business that still sees, the numbers of 50% of the subscription buyers churn out within 90 days. Now we spend all this money and time and effort to get someone, and most of us have tried subscriptions.

You get a coupon or you get, you know, something free and you try it. And then what? The company doesn't have any understanding of why we're getting maybe eating smoothies, but that smoothie company actually has protein powders and desserts and things that might cross sell and upsell if they knew a little more about why I am eating a smoothie.

And so we see the same thing across the board there. So we see a 30 to 40% reduction in churn in the lost opportunities out there in the world of consumer products. 

Ken Lempit: That's really awesome. It's sort of, uh. The very contemporary wash, rinse, repeat, huh? That's, uh, pretty awesome. So you had mentioned.

That you're also meeting people, meeting prospects, and I guess customers at events, right? That events have become really important in your go to market. And we're hearing this a lot that I think years after the pandemic. People are finally, you know, recommitting to events, large and small. Can you talk about your round table, go to market activity and how did, how did you get going on that?

What, what sort of instigated that and what makes a panel conversation valuable to you and, uh, potential clients and industry partners? 

Ken Rapp: So, way back when in my career, and I'm only 35 inside this body, um, but my body's more than 35 now, but way back in my career.

I was part of a marketing team where we asked one of our champions, early adopter champions who was being successful and even other cooperation coopetition companies who were helping that customer, get together on a, in a webinar back in the day, we would carry our suitcases and travel all around the world doing it, but now with a webinar.

So it really is effective 'cause it's educational. So what we did. Here is take the concept of let's invite a customer, let's invite a partner, let's invite, another technology and us, and we'll host workshop webinars. And it's been really successful, doing something like that. We continue it., 

Emily Lagasse: I echo everything Ken says, focusing on education and bringing together a group of panelists that can have a really authentic and engaging conversation with very little work from the moderator. I typically am moderating these events and, you know, anytime you can get panelists together that are feeding off one another, and that energy is just, you know, palpable and, and you can tell that.

The folks that are attending this webinar are coming away with some real key nuggets that they can apply to their businesses. I would also add, anytime you can have panelists share real life examples, case studies, things that people can apply directly within their business. You know, similar to your podcast, it sounds like Ken, you know, you, you have folks on here so they can share what they're doing and others can learn and perhaps take away things to apply.

We intend to do the same thing in our webinars as well. We find that to be very effective. 

Ken Lempit: Awesome. I wanna dig in on one last topic because it seems obvious, but I don't think it is as obvious as it seems. You focus on problems in your messaging, right? So it's problem centric. How did you get to your customer pain points and, and as you have, you talked about.

The drop off in use or churn for a rental company. I mean, it seems clear enough, but I bet there's more to it than what's so obvious. So I'd love to know how you got to the pain points and you know, how are they woven into your own go to market and communication strategy. 

Ken Rapp: You know, it's funny.

My very first job out of college, I went to work. I remember standing at the coffee machine and meeting people and someone told me the story of how that company got started. It was a business that was started without a product. most companies have started 'cause you, you have an idea for a product.

They literally had no idea what they were gonna do. They just knew the target customer and they went out and listened and their fear was not solving the right problem. And that stuck with me through my entire career. And so what we really focused on in the early days here and, and it's in our culture, is to be listening to our customers for their problems.

And then how we as partners can solve those problems is the business will take care of itself if we're solving real problems. So there's a philosophy here at blustream, which is all about just wanting to learn from our customers about problems they have that may or may not be solved and we can't solve all of them, but the ones that we can have an impact on we're super excited to be working in the industry to solve.

Speaker 4: And I would add to that, it's clear 

Emily Lagasse: the data shows all of these companies are having challenges retaining their customers. But there's a question mark about why. So understanding the very specific points and drilling down into understanding what is happening when that product hits someone's doorstep.

Is it mismatched expectations and then that leads to a return? Are they not, you know, filing for their warranty? Registering for their warranty, and not getting the appropriate updates to, you know, make their product work the right way? They're just any number of issues that someone could face. And so getting into each of these industries and verticals and understanding exactly what happens, what happens when a student rents a violin.

Getting to be able to put yourself in that position and speaking to folks in the industry to really understand what the challenges are so that we can work on the solutions from there. Because there are very, you know, little niche opportunities there under the larger challenge of retention.

Ken Rapp: I have one more comment to make on that. You're right Emily, you triggered a thought is, I think e-commerce has commoditized the buying process because I went on just for fun and I typed in dog treats and I got like 1 million hits on Google. Like, so if I was a brand who provided dog treats, even on Amazon, they'll give you alternatives.

It's this unbelievable world we live in right now. So where are you going to build your brand equity and how are you going to, you know, really nurture your customer? It's gotta be post-sale. So that's part of our, the one of the, at the big problem level, I think that's the big macro problem is, you know, technology is great and as brought to us the flexibility and consumers want to buy online.

And now it's so easy to buy and compare online that it's hard to then retain that customer. I think that's why the retention problem and the repeat sales problem is out there. when I was a kid, I would go to my local store and I knew that's where I went. I knew their name.

They knew my name. I just went back there. Now it's so hard to do that, and so we're helping companies really have a connection to their consumer or their customer, for life. That's what we're all about. 

Ken Lempit: I think that's a great place to land our episode. Thank you so much, Ken and Emily. If folks wanna learn more about your company, and I think you have a,journey builder link you also wanted to mention, that'd be a great time to do it.

Speaker 4: We encourage folks to visit our website, blustream.io 

Emily Lagasse: and we also will include a link in your show notes to our Journey builder. So if there's a product that you have that you'd like to understand potential challenges that a consumer may face and how we would propose addressing those. You can visit that link and run your product through our journey.

Ken Lempit: Awesome. And if people wanna reach either of you, what's the best way for them to do that? 

Emily Lagasse: So our email addresses are just our first name, emily@bluestream.io. And ken@bluestream.io. 

Ken Lempit: That's great. And that's BLU, no E Stream, right? blustream.io. 

Folks wanna reach me on LinkedIn? It's linkedIn/in/kenlempit

My demand generation and advertising agency for SaaS Companies is Austin Lawrence Group. We're at austinlawrence.com 

and if this episode hasn't convinced you to subscribe to the podcast, I don't know what will. That's SaaS backwards. Wherever podcasts are distributed. Ken Rapp and Emily Lagasse, thank you so much for being on SaaS Backwards.