One of the oldest adages in business is, “The customer comes first.” Without customers, you don’t have a business, naturally. And so you want to ensure that your customers’ needs are being met and that they come away satisfied. Happy customers are essential to any business, especially as more organizations adopt subscription pricing and rely on recurring revenue.

However, Customer Success has evolved beyond merely providing superior customer service. Ensuring customer satisfaction has become increasingly complex and is tested at each step of the customer journey, which means new processes and new metrics are needed.

Customer Success has to be the primary focus in today’s outcome-driven economy. The value of customer loyalty has never been higher, and successful companies are focused on promoting better results for customers to generate new sales opportunities and minimize customer churn.

“You can focus on adoption, retention, expansion, or advocacy; or you can focus on the customers’ Desired Outcome and get all of those things.” —Lincoln Murphy, co-author of Customer Success

The best way to ensure you stay laser-focused on Customer Success is by incorporating Customer Success management into every aspect of your operation. With a comprehensive Customer Success management system in place, you can increase the lifetime value (LTV) of each customer and turn them into evangelists to help build your business.

Read on to learn about:

  • Customer Success is a companywide commitment
  • The return on investing in Customer Success
  • Outsourcing Customer Success
  • Key takeaways

Customer Success Is a Companywide Commitment

Customer Success management has to be a structured initiative that encompasses every aspect of your organization. Every employee needs to appreciate the value of their customers and the need to help them achieve desired outcomes. It’s all part of establishing a deeper understanding of customer needs and collaborating to create better solutions.

B2B buyers are better educated than ever before. According to Gartner, B2B buyers only spend 17 percent of their time meeting with vendors and spend 45 percent of their time researching solutions. What’s more, 77 percent of the B2B buyers surveyed by Gartner said their latest purchase was extremely complicated.

There are more options for solutions than ever—more information, and more decision makers. As a result, buyers are reluctant to decide for fear of making the wrong choice. This means you are no longer just selling, but also collaborating to understand the customer’s business challenges and provide better solutions that deliver ongoing value.

More companies are moving toward licensing and subscription models that generate ongoing revenue while making it easier for customers to budget for an incremental commitment. That recurring revenue hinges on Customer Success.

Acquiring new customers is five times more costly than retaining existing customers, and a 2 percent increase in customer retention is the equivalent of cutting costs by 10 percent. What’s more, data from Marketing Metrics shows that it’s 50 percent easier to sell existing customers than new customers, and the likelihood of upselling a new customer is 14 times higher than closing a new customer.

Where customer service is reactive, a Customer Success program has to be proactive, which means providing support at each step. It also means having a companywide Customer Success management program. Here are 10 things that can help you embrace Customer Success management.

  • Apply a success perspective—Think about being proactive and, in addition to hands-on activities, assemble the resources and training needed to promote Customer Success.
  • Listen rather than sell—Remember that Customer Success is about collaboration, not closing, and so you need to use active listening and ask open-ended questions.
  • Be proactive—Don’t panic if you encounter a customer problem. Remember, it’s not about losing the sale but promoting success, and so the Customer Success team should serve as first responders to solve problems, set expectations, and promote next steps.
  • Agree on success metrics—Be sure you understand what success looks like for the customer. You want to anticipate customer requirements and stay in front of expectations to maximize Customer Success.
  • Use success analytics—Use metrics to demonstrate the desired outcomes. The right data can help you demonstrate ROI to the customer and highlight where you need to adapt.
  • Instruct the customer—Part of Customer Success is empowering the customer. Share knowledge and show them how to maximize value.
  • Challenge customers to improve—Customer Success is more than anticipating business and process issues and removing obstacles. It should also include identifying ways to extend business success and add even greater value.
  • Safeguard the customer experience—The Customer Success team needs to be able to balance immediate requirements with anticipated needs. Communication is the key. Be transparent and adjust the roadmap as needed.
  • Share Customer Success—As you achieve desired outcomes, the customer’s brand value increases. Spread the word and share that success.
  • Be a customer advocate—When you become a champion for the customer, everyone comes out a winner.

The Return on Investing in Customer Success

The LTV of any customer relationship is the sum of the length of time they remain a customer, the number of products and services they buy, their value as a sales reference, and the amount by which they reduce your sales overhead by focusing on outcomes rather than individual products.

To maximize LTV requires you to strike an unspoken bargain with the customer: You are working together toward a mutual business benefit. With this kind of focus on Customer Success, you are expanding the customer relationship without actually selling, making that relationship more valuable over time.

The evolution of the subscription economy is driving this renewed focus on Customer Success. When you are strictly selling a product, your focus is on closing the deal, which means you can apply more resources toward lead generation and conversion. When your focus is on recurring revenue, you want to lower your customer acquisition cost (CAC) as much as possible and increase LTV.

Rather than thinking of sales as a funnel, you want to think of Customer Success as a positive feedback loop driven by marketing, sales, and Customer Success. Marketing puts leads in the pipeline. Sales works with customers to find solutions to business problems. Onboarding ensures ongoing success through collaboration.

This then leads to renewals and, ultimately, referenceable customers and advocacy. To sustain this feedback loop, lower CAC, and increase LTV requires automation, data, and the right resources to promote success at each stage of the customer journey.

To ensure that Customer Success extends beyond the point of sale, you need access to customer usage data and contextual data to monitor adoption. Using predictive analytics, you should gain greater insight into customer interactions, see potential opportunities to upsell and cross-sell, and identify potential threats before they become problems.

For example, analytics should be able to call out impediments to success such as slow customer adoption. Too often, customers buy new solutions to address specific issues and then abandon them due to user resistance, or because they can’t figure out how to incorporate them into a workflow.

Low initial usage should be a red flag that something is wrong, and additional research will show whether the customer needs help with training, integration, or some other issue. Analytics can reveal other types of issues as well, such as adopting a competing solution.

It’s up to the Customer Success team to adopt a customer-centric viewpoint and ask the hard questions about customer uses and value:

  • How do they use the product or service?
  • Why do they use it?
  • How do we increase the value of that product or service?
  • How do we avoid concerns such as subscription fatigue?

Using customer satisfaction data and other data sources such as market variables, trends, demographics, and so on, can inform every step in the customer journey. That tacit agreement with the customer that you are working toward mutual success should promote a frictionless process that yields ongoing value for everyone.

Outsourcing Customer Success

Outsourcing sales and a variety of customer motions has been a common strategy for years, allowing company staff to focus on core competencies to maximize efficiency. The same is true when you outsource Customer Success management.

Customer Success is about building relationships, understanding the customer’s needs, and gathering the data to generate the insight you need to ensure customer retention and increase LTV. You can outsource customer relationship management and get the data you need for customer retention.

Finding the right Customer Success outsourcing partner offers advantages:

  • You save money—It is much more cost-effective to outsource than to create and maintain your own in-house Customer Success department.
  • You save time—Any Customer Success program requires a substantial time commitment. Outsourcing frees your internal team to focus on core areas without having to worry about relationship management or data gathering.
  • You get highly trained staff—Outsourcing gives you access to experienced professionals who specialize in various aspects of Customer Success, which saves you the cost of hiring and training more staff.
  • You start fast—When you outsource, you get to take advantage of personnel and procedures that are already in place, which shortens ramp up time.
  • You get state-of-the-art technology—One of the biggest costs of any customer relations program is technology. You need more support than you get from customer relationship management (CRM) software, and by outsourcing, you have access to the latest support systems and analytics without having to pay software licensing fees.
  • You can focus on your business—By offloading Customer Success management, your internal team can focus on what they do best, without having to track ongoing customer needs.

Key Takeaways

There are many moving parts to any Customer Success management program, but with the right focus, the right analytics, and the right resources, you can use Customer Success to deliver ongoing value to you and your customers. Here are some key points to remember:

  • Customer Success management is a companywide strategy.
  • Listen, don’t sell, and focus on delivering ongoing value.
  • Agree on metrics for success in advance.
  • Use predictive analytics to be proactive about promoting Customer Success.
  • Apply automation and outsourcing to lower CAC and increase LTV.
  • Customer Success is circular, not linear, and should increase in value over time.
  • Outsourcing Customer Success will save time and money and help you focus on your core business.

Here’s wishing you success with your Customer Success management program.