Ever since the SaaS companies came into prominence, somewhere around the mid 2000s, the major problem they faced was that of customer churn. They spent hefty amounts on marketing strategies to acquire new customers but due to the immense complexity of the software the customers were not able to
Ever since the SaaS companies came into prominence, somewhere around the mid 2000s, the major problem they faced was that of customer churn. They spent hefty amounts on marketing strategies to acquire new customers but due to the immense complexity of the software the customers were not able to adopt them and derive value from them. Hence, they eventually lost interest and discontinued their subscriptions. Because of the companies realizing these losses, they started investing their time and money in building customer retention strategies. They experimented and introduced many functions in their business processes specifically targeting the reduction in customer churn and came up with many new findings that slowly started improving customer retention in their business. As they got more experienced and adept in this area, a new discipline eventually emerged in the software industry which we now call as Customer Success, and gradually a need for a customer success framework has arisen.
This function was upgraded with new tools and methodologies whose sole job was to proactively approach customer retention. Many new roles were introduced out of which Customer Success Manager (CSM) retained its place at the top in this function and today is one of the widely recognized and useful positions in SaaS based organizations.
Businesses realized that the customer success cannot be fitted into their existing framework; hence a need for a new customer success framework has arisen. So what makes up a great framework for your customer success and how to build one are few of the most researched topics for the SaaS companies of recent times.
A great customer success framework should be built around the different stages a customer goes through in their entire journey with the company. Customer experience, which is an integral part of Customer Success, is generated at every stage whenever there is an interaction happening between them and the provider. For a clear comprehension, the customer life-cycle around which a framework can be built is divided into six stages as shown in the below exhibit.
This is the first stage of the customer life-cycle when they interact, mostly passively, with your brand. It is the job of the marketing team to provide a great experience to the prospects through outstanding marketing campaigns. How they design their marketing content, what target audiences they reach, what channels they choose are few of the most critical decisions they can make for effective outreach.
The look and feel of your ads, the aesthetic sense of your web content along with promoting your USPs to the right audience are few of the decisions that can result in either a good or bad customer experience in their very first interaction. According to a Gartner research, 57% of times, customers have already made up their mind whether to purchase the product or not even before they have the first conversation with a seller.
Target buyer personification is another important exercise for filtering out the short-term customers from the long-term ones. If the right features of your product are shown to the right customers from the very beginning itself then it can promise a long-term relationship with those who respond to those ads and get converted.
For a successful acquisition of a new customer it is paramount that the experience they are having while interacting with your sales and marketing team should be as consistent and great as was promised in the earlier stage.
The perception created during the brand awareness stage should not be hindered during the interaction with your sales and marketing team. Hence, a clear agreement about the roles and responsibilities of your sales team should be made right from the beginning for implementing the right framework directed towards customer success.
The sales team should be able to handle all the product specific queries with much ease and if necessary an operations team member should be brought in the discussion should the customer need a detailed description of the product and want to understand how it can solve their problems. The sales team should avoid selling false promises to the customer as the customer success enablement should be their prime motive which should also be imbibed by every other employee of the organization.
This is the stage where the customer moves from all the promises they were made in the earlier stages to actually experiencing them. It is the responsibility of the company to ensure that the customer’s expectations remain the same because of which they decided to purchase your service in the first place. If there’s a proper onboarding process laid out in advance then there’s nothing like it. A foolproof onboarding process covers all the aspects of:
This is the most important stage in the journey of a customer with your product. The customer starts using your products and should be able to derive value from it. It is the CSMs responsibility to ensure that the product is able to move their business ahead as it was promised initially.
The CSM should ideally possess the domain knowledge of the client’s business so that they can show and evaluate in what capacity the product is able to achieve their business goals. They have to continuously monitor their customer’s satisfaction, relook at their business KPIs, conduct quarterly review meetings and recommend them the unused features of the product for driving higher customer engagement to their product. This is the stage when customer adoption takes place and once that is done, the customer retention becomes a natural outcome.
When the customer has fully adopted your software, which you can know from their real-time usage data, and your product has got completely integrated with their business ecosystem then you may know that the customer has turned into a loyal one. Once you are sure that your product has become their first choice to fulfill their business needs and they are definitely going to renew their subscriptions then their loyalty can be leveraged through different means.
You should realize that it has become the right time for reaping the harvest. Based on the immense value they are deriving out of your product they naturally become your brand advocates. At this stage a customer success organization should design their brand evangelism strategies by reaching out to customers for testimonials, customer stories, referrals or reviews.
Once the customer has traversed through all the stages of adoption, has realized the value of your product and has even agreed to become your brand advocate then there can not be a better time to upsell or cross-sell your product to them. Based on their interactions with customers in all the earlier stages, the CSMs can easily guess the customer’s response when approached for further expansion of their business.
The expansion can happen in the form of renewal of service or buying related or higher versions of products with more features. In any case the CS team should be able to demonstrate the further enhancement of the values of their new offerings while recommending them to the customers.
With more and more businesses realizing the need for having a greater customer experience, the customer success framework is getting widened throughout all other areas of a company. 18
The company owners have understood it well enough that without customer success their business cannot sustain in this ever-increasing competitive environment. Just a short impediment in customer experience and the customer is gone! Hence it has become their prime objective to bring all teams into the same page to realize that customer success is not just a siloed function anymore. Everyone has to contribute in their capacity to bring success to the customer by making them realize value out of their product.
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