Customer Success Misunderstood or Mastered?
“Squishy,” “fluffy,” “nice-to-have.” As a passionate advocate for Customer Success, these descriptions of this critical practice area are painful to hear. After nearly two decades of meaningful contributions to growing some of the most respected and profitable SaaS companies in Silicon Valley and around the globe, one would think that Customer Success’ value was understood, and certainly that the definition was known. However, as consultants, we’ve heard the aforementioned comments recently and still find that sentiment surprising. Especially when some of today’s most successful emerging and growing companies are already investing in customer success. In fact, growing companies are 21% more likely than their stagnant counterparts to prioritize customer success. With the cost of acquiring a new customer being more costly than retaining a current one, the role of Customer Success can actually increase revenue and build healthier customers. Furthermore, acquisition costs are anywhere from 5 to 25 times more expensive than selling to existing customers. Customer Success bridges this gap and allows for opportunity of revenue through upsell, and expansion.
As a department that is cross-functional in nature, partnering with all roles to ensure a customer’s success in your products or service, it is clear that Customer Success is a practice area that is here to stay. Keep reading to learn how Customer Success is a key component in protecting and growing recurring revenue and why you need it to succeed.
What Is Customer Success?
Customer Success is anticipating customer challenges or questions and proactively providing solutions and answers. Customer Success helps you boost customer happiness and retention, thus increasing your revenue and customer loyalty. Their focus is on customer health and churn, best practice use of your products and services to meet their needs and make their responsibilities easier or more functional. Companies who have it mastered are seeing customer retention rates continually improve. Whether Customer Success sits on your revenue team or not, their ROI or impact financially will no doubt add to your revenue stream.
Why Is Customer Success Important?
Having Customer Success as part of your organization is a game changer to your company’s overall success. Think about how many options we have just to get a cup of coffee from a coffee shop. They all have what we need, but how do you choose? Other than proximity (which can make a difference fighting morning traffic), the delivery of service, customer interaction, environment, is what makes you choose which coffee shop to go to. You are less likely to grab a cup of joe from a coffee shop that doesn’t greet you at the door, has lack of enthusiasm or attention during the order, but you are more likely to enter a coffee shop where you feel welcomed, greeted, and given service with a smile. There are so many available options at everyone’s disposal that the choice for more customers tends to land on service and experience as the final denominator for making a choice.
Different from Customer Support, this team is not transactional or reactive in nature, adding a new swimlane between your post-sales and renewal stages of your customers journey. This team will best understand the customer’s lifecycle and help them to achieve their unique goals. It is a team that is consistently on the ground level with your customers, building relationships, anticipating needs, keeping them connected with needing your product or service, securing champions or Power Users that ultimately build to advocacy, referrals, and even in some cases, future team members.
How To Quickly Establish a Customer Success Team
- Start with recognizing and confirming your customers’ lifecycle or journey. This will be what the team is responsible for with a clear vision on how to get from post-sales to adoption. This may require data to help make informed decisions, solidify confirmations of what customers actually want, and anticipate needs within the types of customers served with your product or service. These stages in the lifecycle can guide how ultimately Customer Success can be built to scale and support overall initiatives and goals.
- Customer Success has often been compared to a swiss army knife, where the team can have multiple functions in a single role to ensure success. Starting with establishing Leadership Roles and how they fit in your organization will be critical to help support the growing team, with roles within your Executive Leadership Team such as Chief Customer Officer and Vice President of Customer Success for example.
- Determine how your Customer Success Team will own the customer’s experience from implementation through adoption, adding Customer Success Managers or even Implementation Managers, if the responsibilities are worthy of splitting across the two.
- Looking at the different types of customers being supported, could offer opportunity for Tiered Service or Support Offerings for customers. Forrester shared that a tiered service model can actually give you a multidimensional approach to best serve customers. It allows room for different layers of service, a variety of success options for sales and expansions to fit the needs of customers, create scalable portfolios, and often reveal themselves through the Journey Mapping exercise.
- Take time to determine the skills and experience for the team you are trying to build. Think about what is necessary for this team to have coming into the role. This can range from knowledge of the product, prior experience, other skill sets like communication, self-starter, or renewal experience, based on the expectations of the role. This will also help your Recruiting and Human Resources team on what to look for as you hire or offer internally.
As you can see, there is more to this “fluffy” or “nice-to-have” team than meets the eye. Without this team added to your organization, there becomes a limit of what can be reached for the success of your customers. By anticipating needs, working collaboratively to serve your customers, and truly understanding the solutions available to them, a model can be added to any organization where there are in fact no limits to your customer’s success.
By partnering with the Growth Molecules Team, we can assist in getting started on building your Customer Success organization. Not only will you build an organization set to scale, but most importantly, offer your customers the opportunity to have a thought partner, advocate, and expert of the products and services available to them.