At least 90 percent of our blog's content focuses on new business sales, BDR teams, and/or content marketing. Even our name itself, Sales Empowerment Group, implies a focus on generating new meetings and converting new opportunities.
But what happens after the sale? Are your existing customers in a separate bucket from prospective customers? Are new business sales and customer renewals sSAASeen as two different lines on the annual quota chart?
We wanted to address this divide, because -- in the words of Brian Hall (President of Carema Consulting) -- Customer Success is the lynchpin to outsized revenue growth. Establishing a strong Sales + Customer Success partnership leads to happy, long-term customers who generate more revenue and drive brand new prospective customers to the top of the sales funnel. Your existing customers are, often times, an untapped resource for generating new business.
We held a webinar/workshop with Brian Hall and Kathleen Marcell (Sr. Consultant) of Carema Consulting to look at the benefits of Customer Success, why Customer Success should be a focus - both now and moving forward, and discuss what are the top three/four best practices for realizing Sales + Customer Success collaboration. Brian and Kathleen also taught us about the customer journey, Customer Success (CS) as a Marketing engine, how QBR’s are a revenue treasure trove, and how CS captures the voice of your customers.
You can check out the full webinar here, otherwise here's a look at 7 best practices to accelerate growth with Customer Success.
1. Six benefits of a customer success team
What's the importance of Customer Success in terms of growing your business?
Brian Hall put it like this:
"Every growing company needs to not only land new customers reliably, but also make sure your existing customers are staying your existing customers and that their lifetime values are growing with you."
What does this look like when it's done well, when the Customer Success team successfully grows your existing customer's lifetime value? Here are six of the major benefits:
Realize cost savings and extend your financial runway
It costs much less to retain and grow an existing customer vs. acquiring a completely new customer.
We couldn't agree more on this point, especially from our perspective, seeing all of the time, money, and resources that go into successful BDR teams and marketing engines, you definitely want to make sure these efforts are being further rewarded in the form of long-term customers.
Accelerate Revenue Growth
If your company is using the "land and expand" model where you sign with a customer, maybe on a smaller deal first, with the intention to build a long-term relationship where you provide more products and services, a Customer Success team is critical.
More quickly establish product-market fit
The Customer Success team gathers feedback directly from your customers which, in turn, helps you improve your product/solution/service. For earlier stage companies, this research enables you to learn from those first 10-20 customers and reach "product market fit" faster and more effectively.
Make your Customers Sticky
Quick example outside of the world of B2B sales.
Let's say you buy a new Macbook computer and you never hear from anyone at Apple. Three-four years later, when you're looking for a new computer, you might get a new Macbook, but you might also end up with something completely different. You're not as attached to Apple as you could be.
But imagine if you bought the same laptop and you had someone from Apple on a call with you a week later to show you how to get everything setup. They ask you what are the top 3 things you want to achieve on this Macbook and then they follow up with you every month with tips and tricks in those 3 specific areas. When it comes time to buy a new computer a few years later, you'll have more invested into your MacBook that you couldn't imagine making a switch to a competitive brand.
This is what you want from your Customer Success team. Good onboarding, regular check-ins, making sure your customer's needs/problems are met, these actions build a moat around your business and make your customers more sticky.
Leverage your Customers as a Marketing Engine
The best marketing is when a happy customer is singing your company's praises. Happy customers become incredible marketers through testimonials, case studies, being a webinar guest, references, and more.
Increase Valuation with Investors
We have this many customers, this percentage renewed, here's how our revenue went up with each client. Having customer value go up and displaying a low churn percentage goes a long way when presenting to potential investors.
2. Three Key areas of value from customer success
For many B2B companies, especially in the earlier stages, they're so focused on signing new customers, that the concept of Customer Success or an Account Management strategy is nothing more than, "Hey, let's reply to emails as fast as possible. Just keep our customers happy."
But if you could take a few days to really map out what a defined Customer Success strategy would look like, what are the three key areas or stages you'd want to lead your customers through? Brian Hall shared his blueprint for success here:
When your customer signs on, take some time to document and understand the outcomes they're looking to achieve. From there, begin to prescribe a path on how they will achieve these outcomes via your product/service. A lot of this can be done during the onboarding process. Guide them on how to use your product/service and be proactive helping them reach their desired outcome.
The work you're doing in the "Entrench" stage establishes trust and moves you from a vendor to a partner. Now you can leverage this trust, ask your customer to be a marketing advocate. Sharing their story will increase your company's credibility and attract new customers.
You're also establishing yourselves as active problem solvers. This raises the likelihood your customer will come back with new problems and new desired outcomes for you to solve together.
Ends up being one big circle. Sign a new customer, discover what problems they wish to solve, solve those problems, and then share their story to attract new customers facing a similar problem. Your Customer Success team ends up being the secret weapon of both your new business sales and marketing efforts.
3. Where do I start with customer success?
Let's go with this scenario, a company has no Customer Success team. No Account Managers. No defined strategy or experience in this arena. Where should they begin?
Kathleen Marcell (Sr. Consultant at Carema Consulting) suggests an often neglected step: Document the goals of the customer upon closing the deal. Have your sales team log this in your CRM. My customer wants to achieve X, Y, and Z this year with our product/service.
From there, have someone follow up with the customer and confirm/add to these defined goals. And then establish a set cadence (quarterly meetings are a good place to start) to meet with the customer and go over their goals. This way nothing slips through the cracks.
When this becomes overwhelming for one of your sales reps or managers to handle along with their other responsibilities (which it will) now you have a system in place to go and hire your first Customer Success manager.
4. How existing customers fuel new business
Kathleen Marcell shared six ways your existing customers can fuel the top of your sales funnel via advocacy marketing. Here's a look at the different approaches you can try out and integrate into your own outreach strategy:
Ratings and Reviews
What sites do your customers and prospects visit to do their vendor research? Find out what these are and have your star customers fill out ratings and reviews to stay top of mind.
Have one of your most successful customers join you on a webinar. Popular webinar formats for this are a virtual fireside chat or a panel discussion. Don't be shy about asking them to join. Most of your top customers will be happy to do this, plus it's good personal/professional branding for them.
Have a system for generating referrals from your customers. You may want to consider offering a discount for this (receive 10% off if you refer five businesses our way). This step is often forgotten but can save so much money compared to only prospecting cold for your next customer.
Land a quote from one of your customers. Put their photo next to it. Looks great on your website or shared on LinkedIn.
Two recommendations here. First, if one of your customers won't allow you to use their name, this isn't a deal breaker for telling their story in some way. Consider doing an anonymous case study where you say something like, "Client in the manufacturing" or "Education" space. And then proceed to share the outcomes.
Also, a well-produced, well-written 3-4 page case study with professional graphics is awesome, but it takes a lot of time and will hold your marketing department back from other initiatives. Besides, case studies are being quickly reviewed by an executive. Consider a short format like the ones we use here at SEG. Focus on these four bulletpoints:
- Background - Who is the company? Size. Industry. Location
- Challenge - What problems were they facing? What were they trying to solve?
- Solution - What did your company provide as the solution to their challenge/problem?
- Outcome - What was the result of using your solution? What happened? Include some stats and a quote/testimonial.
Current customers serving as a reference for prospective clients, usually one of the final stages in the sales process. Kathleen shares how important it is to create a network of references, this way you're not always going back to the same person/same company. Your top customers are happy to be a reference... just maybe not 100 times.
5. Five primary goals for business reviews
Earlier we talked about where to start with Customer Success and one of the answers was establishing a regular business review (often quarterly, but doesn't have to be). So, whether you're doing this for the first time or you're already running these meetings, here are some expert tips from the Carema team.
Showcase the value
Make sure your customers understand their progress. You're telling a story here with a beginning, middle, and ending (at least the end of one particular problem). Make sure to highlight and remind them where they were before they purchased your product/before they partnered with you. Highlight the progress you're making each quarter.
Learn/Confirm Customer's Evolving Goals
Stay relevant, learn their additional needs and areas of focus. Identify new opportunities so you can expand your footprint.
Clarify renewal likelihood
During a business review, ask your customer if they're willing to provide a testimonial or case study. This is a good way to indicate which customers are most likely to renew. If they say yes to a case study, they're in the green. If they say no to these requests, not always the case, but this might be an early sign that the customer may not renew or you may need to dial up your Customer Success efforts to create a new advocate.
Qualify for expansion
Asking questions, identifying areas for potential expansion. You might find several of your customers are referencing a problem you hadn't thought of yet and this could be the seed of a new product/solution.
Very important aspect, make sure you're getting honest direct feedback from your customers. If something's not going right, if there's a bug, or your customer has suggestions for improvements, this is essential for improving your business. Create a system for gathering feedback, define who on the team will review it, and where this information will be stored.
6. Account expansion impact on investment valuations
What is the single most important factor for driving post-money valuations of Series A SaaS companies?
According to a study conducted by Tomasz Tunguz, Venture Capitalist at Redpoint Ventures, the leading factor wasn't Monthly Recurring Revenue (which so often gets the most focus and attention) but Account Expansion, increasing revenue from your existing customers.
"Tomasz Tunguz goes on to summarize at the end, it's undoubtable that building a great product or service is job one of a company, but making sure your retaining those customers and growing them at the same time is the second level priority and not to be ignored."
7. Skillsets of a customer success manager
Brian Hall suggests first you should take a look at the responsibilities of your customer success role. Is this person going to be responsible for retention and renewal? How responsible are they going to be in teeing up revenue expansion opportunities with your existing customers?
Either way, a big trait to look for is a person's consultative capabilities. Are they good at asking questions. Listening. Doing discovery work and getting at the essence of what your customer is trying to achieve. Someone on the new business sales team or even on the product/implementation side can be a great Customer Success Manager because they know the product/service and have the ability to connect the dots between what they're hearing from the customer and how your solution can help.
Even just one great Customer Success hire can go a long way in accelerating your company's revenue growth.
We hope you got a lot out of this blog recap. As a reminder, you can watch the full webinar here. And you can reach out to Brian Hall and/or Kathleen Marcell of Carema Consulting via their website's contact form here.