The ABCs of Customer Success
As far as SaaS companies are concerned in late 2017, one of the most important topics that we could cover is the idea of customer success. By improving customer success rates, businesses are far more likely to see financial success. I like to think of it like this – Customer success leads to retention. Retention leads to revenue.
So how is customer success achieved? First, let’s talk about something a little less fun…customer churn. Customer churn (when a customer cancels their service) occurs at every stage of business. When a company works to reduce their customer churn rates, they are also likely doing the very same steps to increase their customer’s success rate.
Many startups will focus on closing large enterprise clients. This is understandable. Enterprise clients offer more stable cash flows, glowing references, and more business opportunities for scaling and growing services. However, SMBs (small to midsized businesses) matter just as much. For starters, getting smaller clients is much more manageable with automated processes while enterprise clients are more expensive to onboard.
The essence of customer success is to work on customer retention to reduce customer churn, whether that customer is an enterprise client or a small SMB. In this article, we’ll take a look at some ways of achieving customer success over the lifetime of their subscription.
“H” is for Handoff
The smaller the company, the less hassle the first handoff is. If your company is relatively smaller, then it is likely that the person that recruits a customer is also their primary point of contact with the company over the lifetime of their subscription. If this is the case, there is no problem. However, it isn’t always so, especially for larger companies. Usually, the person who recruited the client hands them over to a customer success management agent, and they become the new client from then on. It is essential in such circumstances to inform the client of this change so that they do not experience any confusion.
There are a handful of important factors to consider when passing a client or lead over to another team member: who will be working with the lead, the size of the lead, the possibility of a larger team working with the particular client, and so on. Make communication a priority for your team to cover any gaps in the process.
“C” is for Champion
Have you ever worked with a customer who just gets what your company does? They might even love the service you offer and are happy to explain it to everyone they know. A customer champion is a person on the other end of a business deal that understands your products in and out and can easily vouch for it.
Customer champions understand the most fundamental aspects of your product as well as the benefits of the service you offer. Customer champions will also typically be excellent communicators. That is why they are so valuable to the work you are doing. Having a customer champion isn’t particularly difficult either. All it requires is communicating with someone who always has an ear on the ground and whose colleagues find easy going and approachable.
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“T” is for Trial
This point is particularly important for large enterprise clients. Say you have a free trial for your product for 30 days. Your smaller clients will be fine with this trial period. Your enterprise clients, on the other hand, will typically see it as only the beginning.
By the time the trial period is over, larger companies will only be beginning to draw up a blueprint for how they will integrate your product into their systems. During the trial phase, your client will likely incorporate your product into a more massive project. Remember, most clients today are employing a whole host of different digital sales and marketing products, only one of which is your product. They might also be pursuing other strategies such as emails, new sales staff, etc. It’s crucial to keep your product at the top of their list of priorities while also keeping things simple.
The trial phase should be split into two phases. The first is to define everyone’s roles. Have a discussion with the client about what to expect. Also, you need to have clear rules for how to get the top brass at your client’s company informed of crucial role changes and technical tweaks whenever you plan to grow the account. The second phase is creating a blueprint for the customer. This plan will detail the workflow, making it easier for them to follow it.
“A” is for Adapt
There are many changes that could take place at your client’s company. These vary in size and impact. For example, your customer champion might switch from their current position to a different one. If such an instance arises, you should move quickly to recruit a new customer champion.
Another form of change is one that affects relevance. Your customer might discover a new product or change the way they do things, impacting the significance of your product to them. Do you still offer enough benefits to justify them paying you for your services? 
Remember, your product needs to give more value than it takes. There will typically be regular cost-benefit analyses conducted on your product to see if it’s worth keeping. In such cases, you should be prepared to defend your product and show why it is still a great proposition.
“G” is for Growth
When an enterprise client starts out with your product, they’ll usually apply it to a specific unit of their business. If they understand the benefit of your product and want more of it, scaling up becomes a point of discussion. This is the perfect opportunity for you to grow an enterprise account and bring in more revenue. Most of the hard work building a relationship and earning trust will have already been done. Make sure to plan and act as quickly as possible before the opportunity disappears.
“S” is for Success
There are so many factors to customer success we could probably have a paragraph for each letter of the alphabet. It’s important to learn from each experience you have with a client so that, as your company and processes grow, you learn what works and what to avoid along the way. Remember these primary factors to helping your customer be satisfied, and you will be well on your way to success too!
Using Red Flag Indicators to Fight Churn
The most important thing to a customer success program in any company is that it keeps the figure representing this rate as low as possible. Of course, the CSM team can do all it can to prevent churn. However, that’s not where the real challenge lies. Once the churn has already crept in, as it inevitably will, how do you fight it? The real problem with this is figuring out why your customers are forsaking your service.
Once you know clearly why users are leaving your subscription base, you have half of the problem already solved. Now it just becomes a matter of plugging a few holes and keeping customers happy.
One way to efficiently track the causes of churn in your product is by using red flag metrics. This is mainly the process of tracking user behavior in a bid to find out where their behavior starts to change and become indicative of abandonment.
The Writing’s on the Wall
Before a user ever leaves your product and decides they won’t be logging into their account again, they show signs of the same. Most users won’t wake up one morning and suddenly decides to abandon a product. It is usually a slow process of frustration or indifference that culminates in abandonment. Your job as a member of the CSM team is to find patterns in user behavior to see these red flags before the user capitulates.
The signs are usually easy to see. The first thing to go out the window, of course, is engagement. What was a casual login every day turns into a login every other day. It soon becomes once a week, then once a month and before you know it, the user is missing in action.
Such signals are what we call red flags, and they are essential as they enable us to see the smoke before the fire begins to burn. Once you start to recognize at the red flags waving, you can quickly remedy the situation using various tools, including automation on a large scale or contacting the customer directly. You would be surprised at the difference made by a popup tooltip, or an automated email can make.
There Are Many Different Types of Red Flags
There isn’t a one-size fits all list of red flags that you can look for. Everything depends on the specifics of the situation; your product, the type of customer, as well a lot of other small details that come into play along the way.
The best way to find red flags is to work backward. Look at clear-cut examples of customers leaving your book of business. These are customers who you are sure to have entirely given up on your product. Try to find the common thread running through all of their cases. You can also look at other issues, such as:
- Customers who haven’t opened your app in a long while
- Customers who have given your product scathingly negative reviews
- Customers who have recently uninstalled your app
- Customers who closed their free trials
The last one is particularly telling since a majority of customers don’t close their accounts, no matter the service. These are some of the things you can look at to give you a clear indication of who already left and who might only just now be toying with the idea of canceling your services.
To understand why customers are canceling your business, gather the data on a group of customers who have canceled and start to look for trends in their experiences. It’s important to look for any patterns as they will help you quickly identify potential future churners and rush to fill the leaks before they become impossible to manage. Try to compare their activity, or lack of it, before they left, with the activity of your most devoted customers. This is when the data you collect as a business becomes vitally important. Refer to their history and compare it to other users, with tools like VisualCue, to understand the trends in unhappy customers.
Activation is a Critical Stage
As mentioned earlier, there aren’t any universal red flags to look out for. However, some common signs will easily apply to many SaaS products and organizations.
One of the factors that matter most is how many users manage to achieve activation. The activation point is the point where the user completes the setup process for their account. The truth is, most users do not reach full activation of SaaS products. The actual percentage is close to 60% of users on free trials. These users never log in to their products beyond that first login.
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Users can fail to reach the activation point for a plethora of reasons. They might just have decided that they don’t like your product, or you might have targeted the wrong type of user with your marketing strategy. There will be some factors you can’t control, but it is essential to mitigate any factor that leads to churn as much as possible.
When the User Doesn’t Login Again
If your product has an established user base, then there is a clear pattern for most users for how frequently they log in, and it is up to you to understand that trend. The typical user might be daily, weekly, and so on. When you notice a user breaking from this pattern, then that’s a red flag of potential churn. The failure of a customer to log in is an indicator that the customer simply doesn’t see as much value in your product as they did before.
Here the solution is to remind them of how valuable your product can be for them. Send them an email containing reminders for them to check their accounts. You can also send them some educational materials or little tips on how to navigate particularly different areas that they might be having trouble navigating. It’s as simple as getting the customer excited about your product again.
The Follow-up Always Matters
Remember, the point of this whole process is to recognize churn before it materializes and nip it in the bud to reduce your overall churn rate. The easiest method to reduce churn before it starts is to observe patterns as they emerge and employ large-scale automated solutions. Tracking these signs of churn is made simpler with the use of the VisualCue data visualization tools. It can help you see patterns in your customer base at a glance and in real-time, allowing you to be able to understand better where your customers find value.
By looking for the red flags you and acting quickly on them, you can reduce your churn rate and turn business around altogether.
- Sources
- https://blog.intercom.com/designing-first-run-experiences-to-delight-users/
- https://glideconsultingllc.com/makes-great-onboarding-process/
- https://glideconsultingllc.com/10-reasons-saas-business-creating-poor-customer-experience/
Understanding Why Some Customers Leave
Understanding why some customers leave is something that many businesses struggle with. Companies small and large have been looking for answers on what they can do to reduce their churn quickly to unlock significant revenue potential. As Benjamin Franklin once noted, “An ounce of prevention is worth a pound of cure.” This idea is the foundation of what reducing churn is all about— preventing small issues from turning into reasons for cancellation.
For the sake of this article when we refer to churn, we will be referencing customer churn rate or the pace in which customers are leaving your book of business. This likely effects your company but if you are a SaaS provider, then this should hit especially close to home. So how can you reduce your customer churn rate now? For starters, you must understand the customer experience from start to finish.
It’s time to get tuned into your customer lifecycle. If your lucky enough to have customer success managers within your organization, speak with them about the signs of a customer who is about to cancel your service. These are the people you should be learning from to better your chances of keeping customers paying for longer. Signs of churn can range from being late on payments, browsing the terms of service page on the application, calling a help number, or even the age of the account. Learn which signs of churn are most important in your business and address them as soon as possible. If a CSM is not readily available for you, use your data to determine common traits of customers who have canceled your service. By monitoring the symptoms of churn, you can better address customer needs before it’s too late.
Consider this, according to SuperOffice.com 68% of customers leave a service because they feel as if the company does not care about them or their needs. One thing you can be doing right now is reaching out to your customers to understand what they expect from your service. By doing this, they will know that you care about their needs being met and will likely stick around.
We live in a data-driven world, and responsible decision makers understand the power of decisions backed by data. By following and tracking your customer experience from start to finish, you better understand common trends and better address concerns. Here at VisualCue, we offer the tools to see in real-time which customers need attention. With limited training, you and your team can find the patterns in the data necessary to meet your customers’ expectations. Happier customers lead to less churn which leads to more monthly recurring revenue in the case of a SaaS company.
No matter the industry you are in if you are running a business than it is safe to say that you are concerned with keeping customers happier for longer. Reduce your churn rate by understanding the customer experience and look for patterns in the data. As you analyze the data, you will begin to recognize commonalities between the unhappy customers. Find these trends and address them because in the end, if you don’t take care of your customers, then I am sure someone else will.