Businesses no longer sign-up long-term complex contracts with their software vendors. Switching from one SaaS product to another has never been easier. The value that the business gets from a software and user adoption have become key to customer retention. Customer Success is all about ensuring your customer is getting the best value from your product.
Who needs a Customer Success strategy?
Anyone who sells to businesses and has customers needs a Customer Success strategy. Acquiring new customers is very expensive given the way digital marketing expenses have skyrocketed in the recent years. It has never been more important than now to retain your existing customers and keeping them happy. Happy customers provide upsell opportunities and more importantly become your advocates.
Today’s most fastest growing start-ups and successful businesses have already invested heavily in Customer Success. Growing companies are more likely to invest in Customer Success compared to their stagnant competitors
These companies understand that retaining customers and keeping them happy is half the job done in the pursuit to build their business. They realize Customer Success is the way to keep customers happy and successful.
How is customer support different from Customer Success?
Customer support is one of the components that contribute towards a happy customer. Some of the key differences are below.
Customer Success
Customer Success is proactively working with the customer in their journey with the product – from onboarding all the way through to becoming an advocate. It involves helping the customer get the best value from the product and keeping them happy.
Customer Support
We all have made customer support calls to our banks and other businesses that we use. It is reactive – they wait for us (customers) to call and try to provide us with the support we need. Customer support focuses on providing support to customers requests over multiple channels including email, chat and social media. Customer support helps solve their immediate and specific problems.
Why is Customer Success Important?
In the traditional way of running businesses, sales and marketing teams were responsible for bringing in new customers. They would touch base with customers occasionally as the life-time value of customers were high. Businesses took time to analyze various software and their companies. Once they decide and buy, they usually stuck around as change was expensive. The role of the marketers usually ended once the customer was closed.
Enter SaaS. Businesses are happy to try software, see whether it solves their problem and whether the product is good. If it’s good they stick around, else they will just move onto the competitor who will happily provide all the tools to migrate their data from their competitor into their SaaS.
Given how expensive it is to acquire new customers, if the churn is high, the business will struggle to be profitable. This stresses how important it is for SaaS businesses to retain customers and keep increasing the recurring revenue.
So, why would customers continue with your business? Only if they get the value from the product as advertised by your sales and marketing. A customer will never churn if they are getting value from the product. After the customer is closed, who ensures that the customer does indeed get the value that was promised to them? Enter Customer Success teams.
Even though the customer bought the product thinking they are going to solve x and y problem using your SaaS product, providing guidance to your customers, helping the customer with training, getting feedback in real-time, and addressing any issues are all important steps in ensuring the customer succeeds and in turn doesn’t churn.
Customer Success Management
Now that you know what Customer Success is and how important it is for your SaaS business, let’s look at how to manage Customer Success as a business function.
Customer Success management involves defining processes and building a team who are passionate in seeing your customers succeed. It involves strategizing proactive assistance, monitoring and customer journey which in turn leads to customer retention.
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In some companies, the VP of Customer Success heads the Customer Success practice. VP of Customer Success would directly report to the CEO, showcasing the importance of the practice. A Customer Success manager in turn manages a team of Customer Success executives.
The responsibility of a Customer Success manager/leader include:
- To define the Customer Success strategy for your team based on a deep understanding of how your customers use your products, what types of customers you have, how different customers get value out of your product.
- To build and manage the team of Customer Success representatives with a good understanding of the product, your company and related best practices.
- Actively monitor surveys and feedback received from customers. Identify bottlenecks in customer retention and improve those areas. The bottom line for Customer Success is the reduction of churn and in turn increase in revenue.
- Work with customer service representatives to identify customers who really get value from your product. Build case studies with the identified customers and convert them into advocates for your product.
- Train customer service representatives to identify upsell opportunities. This helps to increase revenue from existing customers in addition to increasing retention.
How to build a Customer Success team
Building a Customer Success team from scratch can be challenging and there is a couple of ways that it can be done. If you have the time and budget, you can hire a VP or Customer Success Manager who has a proven track record and work with them to build the team, strategy and execution.
An alternative approach could be to identify a leader from within your organization who has worked closely with customers and understands the full value proposition of your product to lead your Customer Success practice. Knowledge of what value your product provides to customers and how customers benefits will be a great advantage.
From being reactive, you can start by being proactive and setting out strategies on how to map out the customer journey of a customer. You can look at your existing customers, who have been with you for a while, to see what worked for them and how they progressed from onboarding to becoming an advocate of your product. The Customer Success manager can templatize that and start creating a process.
With a small team, it would be difficult to focus on all the customers. You can segment the customers into high-value, mid-value and low-value customers and start focusing on the high-value customers. You can start focusing on other segments as your Customer Success team grows.
What are the elements of Customer Success?
There are three main components to Customer Success:
- Customer Success Strategy
- Customer Success Team
- Customer Success Software
Customer Success Strategy
Customer Success, as with any practice, is not a one size fits all operation. What Customer Success means to your business might be completely different to another company even though the fundamentals remain the same – work towards ensuring customers get full value from your product and are excited.
The first element is to build out a strategy. For this a deep understanding of what has worked well, what hasn’t, who your customers are, what features they use the most, what they like, what they do not like is important. Once you have this information, you can start devising a strategy that tries to replicate what worked well for one customer for other customers. If some features are used more, you can see how you can get customers who don’t use that feature to start using it. You can also identify problem areas across your customers and plan a set of activities to correct them.
Once you have the strategy in place, it’s time to create a repeatable process that will fix some of the issues you have identified and build a team to realize the processes.
Customer Success Team
Once you have your strategy and process in place, you would need people to execute it. We have already discussed a couple of ways you can build a team above. Choose what works best for you. Start small – focus on the high-value customers, learn more about your customers and then as your team grows focus on all your customers.
Customer Success Software
Businesses who run SaaS companies use several third-party tools to support their business. For example, they might use Segment for data collection, Freshservice for their helpdesk, Pipedrive for their CRM, HubSpot for marketing, SurveyMonkey for their NPS scores and so on. To draw a complete picture of your customer, you would need data from all these tools in one place. Moreover, you want this data to be represented intelligently to simplify the work of the Customer Success representative and help them focus on helping customers rather than doing data analytics work. This is where Customer Success software comes into play.
You can think of this software as the platform where your Customer Success representatives would carry out their day-to-day work. These software help Customer Success teams identify the customer who requested help and also to proactively identify customers who need help. Choosing the right customer success software becomes important as it is through this software that the customer success strategy gets defined. They also help manage a repeatable set of processes to make sure all customers, though managed by different representatives, have an experience as defined in your strategy.
This software also provides several personalized automation for doing repetitive work which helps Customer Success representatives save time and focus on high-touch high-value activities.
Conclusion
Customer success teams are no more a nice-to-have, but a must-have for SaaS businesses. It might seem like a lot to implement, but as discussed above, you can start small by identifying a champion from within your organization and focusing on your high-value customers. You can then slowly build out your team along with the help of Customer Success software.
