Customer Success: Loyalty (and Revenue)Comparing customer success against the sales function within an organization.
Customer loyalty is a priority for businesses because it commonly equates to retention. Retaining a customer maintains revenue and presents an opportunity for further revenue growth. The acquisition of new customers is often a more expensive endeavor than maintaining and creating value from existing customers. For this reason, customer success management (CSM) is key to driving customer loyalty that results in revenue expansion and more substantial profits.
As will be explored in the following sections, customer loyalty and revenue are positively impacted by a customer's level of engagement. A more engaged customer is likely to be getting the most out of a product or service, resulting in higher customer satisfaction and the likelihood of retention. CSM increases this engagement through its core principle of creating real and lasting partnerships with customers. The more a customer feels they are heard, the more likely they are to share their opinions and experiences with customer success teams. These opinions and experiences create the data and resources for CSM to tailor and refine their services. As the CSM processes become more refined and efficient, the customer can maximize the value they receive. The higher value to the customer increases the likelihood they will remain loyal or even escalate their engagement with higher-priced products. This value to the customer also translates into their involvement with other potential customers. In this sense, customer success models stand to increase revenue through customer loyalty and generate opportunity for loyalty with new customers.
Let’s explore in greater detail how customer success strategies drive loyalty.
How Customer Success Drives LoyaltyOverview:
- Expeditious Onboarding
- Conflict Resolution
- Tailored Services
Onboarding is the first opportunity for a company to make an impression on the customer. The onboarding process is especially critical for SaaS companies looking to empower and inform their customers to use their products as effectively and broadly as possible. Pacing is vital in this introductory phase. CSM contributes directly to this end by making the onboarding process both efficient and effective.
The onboarding phase is commonly regarded as getting the customer to a place where they are deriving value from the product. Achieving this value for the customer as rapidly as possible, without sacrificing quality, contributes directly to customer satisfaction and success. This is also the first opportunity to establish a practice of goal setting with the customer. For example, a CSM can develop and communicate a timeline to the customer for when they can expect to adopt and produce value from the product. In turn, succeeding in this goal establishes a precedent for achieving future goals. CSM's efficiency and efficacy increase the value a customer receives, resulting in higher loyalty and retention.
Customer success teams also increase loyalty in their preparation for managing and foreseeing conflict. Escalations with a customer will inevitably arise. The CSM department actively monitors and engages this crucial area. Managing conflict resolution occurs through responding to phone calls, emails, or even commentary available through social media channels or discussion boards. CSM can also instill software solutions to monitor customer usage or comments, identifying at-risk areas or negative experiences as early as possible. Identifying and proactively mitigating conflict resolution increases opportunities to build or regain trust with a customer, resulting in higher rates of loyalty.
Customer success teams are well-positioned to create services that are specifically tailored to their needs and goals. This includes how those needs evolve and change over the customer lifecycle. By engaging in partnerships with customers, CSM is uniquely equipped to transform a company’s product that is designed for a broader audience and shape it to fit the individual needs of a customer. CSM accomplishes this task through open and ongoing communication, as well as monitoring and analysis.
Communication leads to active customer engagements, the establishment of attainable goals, and an avenue to receive feedback. Monitoring and analysis are employed by CSM through software technologies, surveys, and various other metrics. An adequately utilized CS team is also exceptionally well equipped to source from departments throughout a company to provide the most tailored customizations. In addition, the data and experience CSM provides a company leads to improvement across the company, such as product development, market research, or budgeting. With the refinement that results from CS modalities, the customer experience is heightened, and value is increased. As mentioned in previous sections, improving value for the customer results in a loyalty that builds long-lasting relationships.
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