Customer Success Strategies: From Churn to Customer Value
The concept of Customer Success originated with companies actively targeting ‘at-risk’ accounts with teams designed to increase retention by helping customers derive more value from their products and services. These companies soon discovered that their efforts, initially targeted at “stopping the bleeding,” could be extended to their entire customer base. This proactive approach helped transform Customer Success from a reactive discipline focused on stopping churn to one that emphasized increasing retention and expanding customer value. The result: increased customer adoption, higher perceived value for the product and greater customer loyalty.
Applying Customer Success to Your Business
Although Customer Success began in the enterprise software industry, companies in other sectors selling products and services or that have recurring-revenue business models now realize helping customers get the most out of their product(s) or service(s) increases customer satisfaction and lifetime customer value. These companies also live by the 80/20 rule (80% of their revenues come from 20% of their customers) and acknowledge that the cost to sell to their most valued customers is a fraction of the cost to acquire new ones.
Here are just a few examples of how Customer Success strategies and techniques are being employed today:
B2C: Customer success is a key strategy used in the sportswear industry. Companies like Nike and Under Armour have runner’s apps that do everything from connecting runners with personal fitness coaches to tracking running metrics with sensor technology on their footwear. This helps their customers succeed in achieving their running goals.
B2B: Within the oil lubrication industry, manufacturers aggregate customer metrics on lubricant performance, and then offer these metrics to their customers to for example help reduce machine downtime. Using real-time data, they track the results per type of machinery to recommend the best lubricant for each model. This helps ensure their customers’ success.
B2B2C: Business services such as insurance and financial services that sell via brokers or agents need an in-depth understanding of their end-customers’ needs to provide the right products backed by excellent service. Brokers/agents now have Customer Success Managers meeting monthly with a variety of end-customers to assess their needs and to gather metrics on how the company’s services are performing. During these meetings, the insurance and financial services brokers/agents help ensure their customers are successfully applying their services and also identify potential cross-sell/upsell opportunities.
Customer Success strategies will become increasingly critical to gain competitive advantage in any business where nurturing long-term customer relationships and management of a customer’s lifetime value is important. In the past, the buying journey ended with the sale. Customer Success strategies dictate that the first transaction is not the end but part of a longer-term customer journey leading to greater customer value and sales. Your job is to remain proactively engaged with your customers by helping them to achieve success, which will also increase sales of your brand.
Don’t be left behind. Contact us to learn how ISM can help create and implement your Customer Success program, and how to integrate this program into your overall Customer Engagement efforts.