How to Prevent The “C-Word” (Churn) via Customer Support
New entrepreneurial ventures often have a go-to-market strategy of acquiring new clients and creating velocity to amass a large client base. However, as time passes, these new businesses encounter a new challenge that most did not consider when launching from their humble beginnings: retaining customers. Of course it is important to acquire customers, however it is just as crucial to keep them. What can you do to retain your acquired clients, avoid churn, and lost revenue? Read on to learn about churn and how to reduce the loss of your customers.
All About That “C-Word” (Churn)
Churn denotes a rate that shows how many clients stop using your services or products. Simply put: it is the loss of customers. The churn rate gets measured by assessing the failure to renew subscriptions or basic service or product use. The rate gets evaluated based on a specific time frame (typically monthly, quarterly and annually, but some business models inspect this metric daily or weekly).
Minimizing customer churn is paramount because it is expensive to acquire new customers. Research by the Harvard Business Review shows that it’s 5 to 25 times more expensive to acquire a new customer than it is for your company to retain customers. Conversely, it’s also been proven that increasing customer retention rates by 5% increases profits by 25% to 95%. There is hope!
In keeping with that positive motion, what if we dropped the c-word altogether and focused instead on the “glass half full” perspective: customer retention?
Businesses seeking to secure customer renewals may wait until the last month of the agreement to begin the negotiation. Incentives like flexible payment terms or additional services at cost may come into play, However, in addition to the crucial customer journey elements of driving adoption and deriving value, improving a business’ Customer Success and Customer Support abilities are often one of the best ways to enable improved customer retention.
Customer Success or Customer Support? Establish Distinguished Functions
Firstly, it’s important to differentiate between Customer Success and Customer Support. They are indeed two unique disciplines with specialized areas of focus. However, both are essential to the holistic customer experience.
Customer Success is typically a proactive function responsible for driving customer adoption [of the product or service], ensuring that the customer’s intended business outcomes are being met, looking for opportunities to protect and grow revenue, and the most important, to be the internal advocate for the customer. Another key attribute of Customer Success is that there may be direct responsibility for an assigned portfolio of customers. That is to say that one “Customer Success Manager,” as the role in this function is often called, manages the customer relationship through all of the aforementioned key areas: adoption, business outcomes, revenue, and advocacy.
Where Customer Success aims to anticipate a customer’s needs, Customer Support on the other hand, is a reactive function serving in moments of technical uncertainty. The charter of a Customer Support team is to achieve customer resolution as quickly and painlessly as possible for the customer. Below are three insightful tips on how to execute flawless Customer Support that meaningfully contributes to customer retention.
Provide Real-Time Help & Customer Self-Help
In 2016, J.D. Power & Associates reported that 42% of customers prefer live chat compared to just 23% for email, and 16% for social media or forums. Therefore, companies must pay attention to the key learnings from this behavioral trend: people want information immediately and live chat functionality satisfies that desire.
Live Chat is the channel preference of the new breed of business-to-business (B2B) customers. Gone are the days of 1-800 number phone dialing, and even email correspondence is waning as it takes too long (the average response time is 12 hours!). Customers seek real-time help and statistics show that it pleases them: Live chat has the highest satisfaction levels for any customer service channel, at 73%, compared with 61% for email and 44% for phone. (Source: Econsultancy). Provide real-time help to nurture your product’s customer experience.
In addition to Live Chat, customers appreciate self-help tools like knowledge bases, user communities, in-application tips, and video tutorials. These modes of communication can come via a Customer Support Portal, a Learning Management System (LMS), or even as links within a company’s public-facing website. The goal is always the same: get the information in the customer’s hands as quickly in the most direct, effective, and pleasant manner possible.
Improve 24/7 Availability
The COVID-19 pandemic of 2020 further accelerated the way that business is conducted. No longer is work in an office commonplace, rather many employees of B2B companies are working from home. This also means that flexibility in when work is getting done has changed: Salesforce has highlighted that Thursday is the new Monday with their 60K-strong workforce.
With increased flexibility in work schedules, and greater accessibility to high speed internet access, a follow-the-sun customer support model is more important now than ever. Customers want to know that they can get customer support at any time of the day or night. Support that is available 24 hours-per-day for seven-days-a-week (24/7) is vital in customer emergencies. Artificial Intelligence (AI) chatbots are one such way to quickly augment your lower volume hours of Customer Support.
Collect Client Feedback and Close the Loop
Most B2B SaaS companies have survey tools in place to measure Customer Satisfaction (CSAT), Net Promoter Score (NPS), Ease of Use (EU), or other key performance indicators. These survey types gather the customer’s quantitative and qualitative feedback to help your business measure their satisfaction rate and know their desires and preferences. Gathering such information and providing appropriate feedback to such clients is vital. Such a system will make them feel valued, and they may continue using the product or service once all uncertainties and complaints are well handled.
However, companies must have the standard operating procedures, enabled staff, and necessary team empowerments to act on the survey responses. For positive feedback, train your Customer Support team to thank the customer and ask if (s)he would be willing to publicly promote your company with an app site review or by participating in a marketing case study. For negative feedback, ensure that the response protocol stipulates that a customer support representative response is deployed within a maximum of 24 hours. In both scenarios, closing the loop with customers can even be automated leveraging the aforementioned chat bot AI technology.
While Customer Success is a critical piece of today’s B2B software-as-a-service (SaaS) customer experience, technical Customer Support is of equal importance. When Success and Support programs are thoughtfully executed, customers will love you, making it easier for them to be retained by companies.