Role of Customer Success in Organizations
“Customer Success is a long-term, scientifically engineered, and professionally directed strategy for maximizing customer and company sustainable proven value.”The Customer Success Association
Customer success is a method of determining performance and satisfaction based on results. A way to demonstrate the real-world impact of your product. Customer success efforts provide an answer to a simple question: Does your product help customers achieve their desired outcomes? This in turn helps you retain customers, identify upsell and cross-sell opportunities and attract new ones through referrals.
Customer success is an exciting and relatively new concept in business. The purpose of your product is to cater to your customer’s requirement and help them achieve their desired outcomes. Their success ensures continued usage of your product which results in the success of your business. To initiate customer success within an organization requires trained teams, access to meaningful insights and the ability to automate actions at relevant moments.
It is important that customer success is a company-wide endeavor, and that includes all teams and individuals; all the way to the top management. If an organization wishes to maximize on the transformative benefits of the customer success effort, then it must lead from the top-down. This change will requires aligning the mindset and goals of everyone at an organization. Customer success efforts will require the below steps:
- Know: Understand your customer 360 i.e. persona, revenue, sentiments, usage, etc.
- Identify: Ability to pinpoint accounts at risk, primed for an upsell, in need of training/guidance, etc.
- Act: Take relevant actions by managing touchpoints, timely intervention, personalized communication, pulse feedback, etc.
Customer Success v/s Customer Support v/s Customer Experience v/s Account Management
There is a lot of confusion in organizations with many of these words being used interchangeably. The customer support function is reactive in structure and deals with customer issues. After customers reach out through emails, tickets, etc. these teams try to resolve these issues and hope to keep the customer satisfied.
Account management is also reactive as a function. Although they share similar goals with a customer success team, account managers are more focussed on renewals, upsells, cross-sells, etc. The effort of the account managers is only to ensure that the customer’s stay subscribed and not really on them getting maximum value from the product.
Customer Success on the other hand is about being proactive, and what this means is that the teams gather insights through various touchpoints, multiple systems, monitor the data points through the customer’s journey to identify opportunities and risks. It involves getting into the mindset of customers’ success as opposed to viewing them only a means to generating revenue.
Customer experience broadly covers the customer’s entire journey and their satisfaction using your product to achieve their goals. Through the customer success management software, you are able to better understand the customer experience and influence their journey to improve it.
Why is Customer success important?
“In traditional enterprise sales, the salesperson sold the customer a product once for a perpetual license and committed the customer to pay an annual service fee, often 15-25% of the price of the software.”Tomasz Tunguz
SaaS businesses today rely on revenue generated through monthly or annual subscriptions from its customers. This gives the customers an opportunity to switch to another solution at every renewal if they don’t see value in a product.
Role in Customer Retention & the Renewal Process
There are accounts where the customer is not entirely satisfied, nor seeing enough value, but continue paying for the product for unreasonable periods of time. Such accounts are termed as “prisoner accounts”.
This is definitely not a way companies would get far anymore. Companies have to understand that their customer accounts churn due to lack of involvement with their product, and this could be due to poor onboarding experience, where they don’t quite understand how the product is beneficial and what needs to be done by them. As a result, most customers would run the course of current subscription i.e. a month, quarter or year and then move to another product.
It is crucial that they see value in the product and understand how to implement it in their strategy and processes. That can be achieved through personalized experience which can be delivered through relevant training, timely guidance, accurate and simple instructions. It would also be extremely valuable if customer success managers are able to gather meaningful feedback from customers. Based on this feedback and other information about the customer’s engagement and adoption through their journey, a customer success manager ensures that issues are addressed even before they arise, and a customer’s subscription renewal is mere formality.
Traditionally, upselling and cross-selling was merely done by account managers with the core focus on revenue expansion. Today, customer success managers also have goals to expand the revenue from existing customers, however, keeping their desired outcomes in mind. The customer should understand the value of the core product and also if subscribing to a higher tier or another complementary product adds value to their operations.
As a customer success manager works with customer’s very closely through their journey, they are in a position to notice opportunities which can be resolved by another solution offered by them or their extended teams internally.
Source: McKinsey & Company
How to implement Customer Success?
As we’ve seen and understood that the entire organization contributes to the success of a customer and a change in the mindset internally is pertinent. This includes bringing about a customer-centric culture and a focus on the product. In other words, product success will help customers appreciate your product and build a deeper relation with them. In addition to this change in the culture, a strategy, relevant technology and trained team will be required to successfully operationalize customer success.
Relevant technology to support the customer success strategy
As a SaaS business you know that ensuring customer success can help retain subscribers. But how do you measure customer success? What metrics are essential for your product, and what results are critical for your customers? A customer success solution provides a single platform with relevant insights, a mechanism to execute or act appropriately, and better way to scale the customer success efforts efficiently.
Trained Customer Success team
Every SaaS company relies on customer success for their own success. A trained team of customer success professionals can help in achieving this by understanding the customer’s objectives and fitting it with features of their product or solution that help with it.
In most organizations, the role of these professionals ends up being that of a firefighter, as they are reacting to escalations and complaints from customers and trying to resolve them.
As the customer-facing resource, the customer success teams will need to establish communications with customers and connect to create and nurture a positive relationship and rapport. A trained team aims to become trusted advisors of the customers; they listen to the customers, understand their desired outcomes, and propose solutions that guide them towards success.
Food for thought…
The role of customer success is extremely crucial in all businesses. The mindset change across all internal stakeholders can ensure the success of all customers, right from the beginning of their journey.