Summary: I get the impression that nowadays everybody is talking about Customer Experience & Success. Although some reactions were less positive and therefore very surprising. So let’s understand why Customer Success matters.
(4 minutes read, audience: anybody interested in Customer Experience & Success)
These were some of the reactions I got when I spoke to business leaders recently:
John: “I never heard about Customer Success before!”
Graeme: “Great stuff, I know about Customer Success, but nothing new though!”
Lincoln: “It’s just another buzzword!”
Teresa: “Sure, these are the folks calling customers who are in arrears with their payment!”
Customer Success – Nothing New!
So, let’s not get too defensive! Let’s start with Graeme’s response, as his staetement is quite interesting. Here are my thoughts:
A friend of mine owns a tool and equipment hire business; he is a down-to-earth person, and very passionate about his business. I never heard him talking about customer centricity, churn or Customer Live Time Value. Nevertheless, his company is thriving from year to year! He doesn’t need any lectures to understand that happy customers are returning customers and how it impacts the revenue of his business. He is committed to doing all the right things, always available, never letting his customer down, and genuinely dedicated to finding a solution to any problem regardless if he is doing it for an existing customer or a prospect.
However, let’s bring in another dimension into this discussion: Of course his business lists all tools and machines you can rent on the company website. But this website just ‘sits’ there, it only offers a search function for products you can hire. He has never thought about triggering additional initiatives linked to the actions of his website visitor:
- If the visitor was interested in water pumps to rent, we could send a follow-up email including some pump-related information? Something like “Tips and Tricks: How you avoid your water pump to clog!”
- Or rethink: Rather than having the website visitor digging through all products, the website is designed to recommend some suitable products after asking the visitor a few questions. Alternatively, offer a call-back option!
Do you notice the change?
Successful businesses have always been customer-centric.
But with entering the digital space we gain additional opportunities to
engage with our customer, changing the customer experience and
adding new ways to retain customers!
Your three Growth Engines!
By now we have hopefully convinced Graeme that the digital age adds additional opportunities and touch points with the customer. But what shall we do with the remaining responses? Just recently I changed my approach when explaining Customer Success. My train of thoughts is as follows:
Every business has three growth engines.
- The first growth engine is about acquiring new customers, usually run by sales and marketing.
- The second growth engine is about retaining these customers. It is common to expect that with great product and services, customer retention will naturally follow. However, triggered by the subscription economy, businesses realise the importance of retaining their customers additionally to acquiring new customers.
- Once your customers are happy, you can address to increase customer referrals and identify up and cross-selling. This is your third growth engine!
The good news is that there is a framework called Customer Success. This framework comes with a robust and tested set of, i.e. processes, templates, metrics, and playbooks. In other words: If we shift our conversation towards retaining customers (by creating value for them) and then introduce Customer Success as a proven framework to achieve high retention, our sceptics will give us a chance. And the team taking care of retaining customers is the Customer Success Team, not the Sales Team! So I reckon John now understands as well why we need Customer Success.
Your take-home message
Next time when you need to ask your manager for more resources try these steps:
- Talk: About the three growth engines.
- Convince: Retaining customers is as important as acquiring customers.
- Introduce Customer Success: A robust and tested framework to retain customers!
- Explain: The resulting positive impact on churn, retention and LTV!