Close

June 3, 2021

The Importance Of Customer Success For Every Business

The reason why customer success is important

Customer success is the buzzword in today’s B2B world; that’s why businesses prioritize it. It is all due to the changing business trends and realities, and customer expectations in the last decade. It’s true that it has become the essential factor across the business of all sizes. The more a business gives it importance, the more it makes to grow the business. When a business emphasizes customer success, there is a lot of confusion on how customer success is different from customer experience and customer support and how to make sure that your customer is successful. Here’s everything you need to know about customer success.

What is customer success

You can define it as a methodology used in business to ensure that your customers achieve their desired results using your services or products. In other words, it is a relationship that focuses on the management of your customers and aligns vendor and customer goals for outcomes that are beneficial for both of them. When you have an effective customer success strategy, it will help to derive more revenue and reduce churn. 

Customer success vs. customer support

Customer support is not the same as customer success. There are a lot of differences between these two terms. The biggest distinction between customer success and customer support is that first is proactive while the second one is reactive. However, customer service and customer support teams provide assistance to customers and answer customer queries, and the customer success team works to facilitate customers. So, there is no need left to contact customer support.

Customer success and customer experience

Customer experience can be defined as a customers’ perspective when communicating with your brand or company and using your product /services. If you want to improve the relationship with your customers, you can consider these terms like customer experience as the ‘how and customer success as the ‘what.’ You should take into account customer experience to make a successful customer success strategy.  

Why do businesses need customer success?

There’s no surprise that your business’s success is intertwined with customer success. If customers use your products and like them, they will surely continue using these products for years that help you grow, and your business will succeed. You can say that that’s what customer success is all about at its core; as we mentioned above-means when your customers use your products, ensure they achieve the outcomes that they exactly want.

Pulling that off needs data, people, and methodology, this way, you can help them succeed while using your product. When you don’t know why, how, and when they are using your products, you will not get customer success.

Why is customer success important?

There’s no doubt that customer success induces business success. Moreover, it increases customers’ loyalty and their happiness, and eventually, your loyal customers become your brand advocates. Customer success helps to decrease churn rate and increase customer satisfaction and revenue that means it is linked to your bottom line.

Moreover, it has the power to grow your base of brand advocates. It helps to improve renewal rates that can be very helpful for subscription-based businesses.

When you have more loyal and satisfied customers, it leads to decrease churn rates and increase retention that impacts your bottom line directly. When you manage to retain customers, you will witness a boost in revenue. Acquiring new customers can be more expensive, so it’s a win-win situation.

Customer success reduces churn

These days, inbound marketing strategies are quite popular in the tech business, and they rely on them-means online reviews play a crucial role in lead generation. However, revenue models demand to create MVP (minimal viable product) initially and then through a reiteration process that is driven by user feedback that helps to improve your product over time. When you pair your users’ feedback with reviews-means, you have got more product commentary (positive or negative) that churn and purchasing decision happen faster. You need to have an agile team of experts that help you in customer retention, predict churn and stop it as well.

However, you need to train your team and educate them according to your company’s needs. The customer service team can gather valuable feedback from your new and recurring customers. Combine this feedback with your customer health data that can lead to an enhancement or any other good addition to your product.

Customer success drives more revenue

According to Jason Lemkin (MD of Storm Ventures), “customer success is where your ninety percent of the company’s revenue is.” This may be because, with tech companies, opportunities thrive on cross-selling and upselling. So you can say that customer success provides a method for creating these opportunities and help you make the most out of them.

Customer success improves the renewal process

When it comes to the technology industry, gone are the day when you lock your customers with contracts for life. Instead, these days they hold power. Technology business works on renewal business model, so they constantly handle the renewal sales process. Each time when your customers see yearly or even monthly subscription payments, they think, should they be paying for it? That’s why you might see software renewal conversation occurs more frequently than perpetual software sales.

Impact recurring revenue

Customer churn may be described as customers that stopped doing business with your company. If you are subscription-based businesses or SaaS companies, then customer churn rate means this percentage of customers who stopped using your services/products during the specific time period. The more customers cancel your service or stop using your product, the lower your recurring revenue unless you are able to attract a lot more new customers to replace them. However, it is said that acquiring a new customer costs five times more than retaining your existing one. Moreover, if you manage to increase your customer retention by 5%, you will see a 25%-95% boost in profits.

Customer success best practices

No matter what the size of your customer success operation is, these customer success practices will surely help you reap the advantages of customer success.

Track the metrics of your customers and share this data with your team

You can’t define customer success by yourself. However, it is a data-driven goal. You need to track the key customer metrics and share this data with your customer success team. There are some main customer success metrics that you should track, including repeat purchase rate, your customer retention cost, churn rate, lifetime value of your customer, net promoter and customer effort score, and satisfaction score of your customers.

Create a customer feedback loop

Don’t consider it a one-time project. Rather it is an effort that requires continuous refining and updating to better serve your customers and keep up with an updated product. You need to create a loop that brings in genuine customer feedback is a great way to keep up with those changes. Moreover, you should remain active for the long term.

Identify red customer flags

The customer data is the early warning that shows that how much your customer is struggling with your service or product. So ask your customer success team to identify the red customer flags and find new ways that help your struggling customers back on success’s path. You need to develop a system that flags these indicators for your customer success team manager to address. This way, they can rectify customers’ issues directly and provide them the help they need.

Carry out a customer success program

Create a customer success program for your team that guides them to effectively assist your customers. Every business has its own version of a customer success strategy, but you need to make sure that it meets the expectations of your new and existing customers. Once your business grows, don’t hesitate to modify your customer success strategy. 

Promote customer loyalty

The customers who have a positive experience with your business lead to loyalty. You want them to feel happy and satisfied; they are getting value when they shop from you. That’s why you should promote customer loyalty that helps you increase your customer retention rates. There a lot of ways to promote customer loyalty, like develop a community for your current customer, create a loyalty program, and build a discount system for your current customers that lead to additional purchases.

What does success really mean to your customers: Understanding it

As we have talked about customer success. But have you understood what it really means to your customers? Success with your services or product may be different for all customers, so it is crucial to understand what their definition of success is. If you define success by the customer, it should be the goal of your team who is working on customer success- not defined by your company.  

Takeaways

In today’s world, successful businesses prioritize customer success. As subscription-based businesses are a new norm, every business is trying to help their customer succeed. Businesses can take advantage of implementing a customer success program. Your customer success team can have a great impact on your revenue, churn rate, and customer loyalty.

Read more from Stealth Agents:

Leave a Reply

Your email address will not be published. Required fields are marked *