As a SaaS customer success specialist, you’re probably juggling a lot. With so many ideas to expand and grow and several customer success strategies up your nose, it's hard to know which direction to take. Hence, the safest route is to consolidate all your thoughts and strategies.
That will take you on the road to success, taking along your customers and employees.
So, here we are with an in-depth dive into the SaaS customer success strategies to implement in your business operations for growth and success.
Unfortunately, businesses' number one mistake is to focus on new clients and not invest any effort in retaining old customers. That leads to a potential loss of customers. The loss of a single customer multiplies and leads to a considerable percentage loss of your customer base.
That would mean increasing efforts down the line to attract new clients. That's way more costly than retaining your old clients. That's where SaaS steps in. Customer success leads to customer retention. So, let's look at what SaaS customer success means.
What is Customer Success?
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Customer success is learning about customer challenges and finding the best possible solutions. Thus, the strategy helps you keep your customers delighted in the least. That translates to customer retention, hence company profitability and growth.
The more you stay focused on retaining your existing customers, the less you'd have to invest in sales and marketing to find new ones. Another advantage of maintaining your customers is that loyal customers become brand ambassadors.
One happy customer will tell about six other people about their experience. Hence, your base will automatically grow without requiring you to invest more money.
That also reduces the churn rate and increases your revenue.
Difference between Customer Success and Customer Support
You’ll find several journals and papers that use the terms customer success and customer support interchangeably. However, there’s a distinct difference between the two. Let’s take a look here:
Customer Success
Customer success is about being proactive.
You develop an action plan for onboarding new clients and partnering with customers. This approach lets you get first-hand information about the customer’s experience and feedback.
Customer Support
Unlike customer success, customer support is more of a reactive approach. While the SaaS customer success team works on developing the complete plan for onboarding, customer support provides ‘support’ or clarity to the customers about the same onboarding process.
The team addresses all customer requests, issues, and queries using different media like email, chat phone, and other social media platforms.
In other words, customer support comes into action once the customers raise a question or concern, so it’s a reactive fulfillment of customer demands.
However, customer support and success ensure a smooth customer onboarding process.
How to Measure Customer Success in SaaS?
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For SaaS companies, the better your customers can use your product, the higher your revenue. This is a difficult step since most customers begin to use the product directly without any help from your sales staff or customer service managers.
So, the higher your product's success rate at getting the client to use it correctly, the more the chances of them staying with your company for a long time. Plus, they'll also refer your product to others down the line.
Now, how do we measure SaaS customer success?
Traditionally, we used a few metrics for measuring customer success:
Number of tickets closed by the reps
Number of product demos booked for customers
Number of emails sent to customers.
However, today many consider these metrics outdated. Nowadays, the efforts are more on maintaining your customer relationships. That is determined by
The customer's understanding of the product
Their satisfaction with it.
The use of all the functionalities of the product.
These aspects can drive further sales and build your relationship with the customer. The more you invest in keeping your customers happy with the product, the less the chances of churning.
However, there are hundreds of ways to track and measure customer success. So, which are the best for your company?
Here, we've shortlisted the top industry customer success measures to make your business thrive and help you achieve your bottom line.
Easier & Faster Onboarding
Customer onboarding is crucial to customer success and retention. A bad onboarding experience will likely end mid-way through the sales, so the customer may assume your product is useless and will probably leave soon.
Creating a smooth onboarding process for your clients is vital to keep your customer happy and focused on the development product. You can track customer engagement during the process to see if your customer has any doubts or questions.
You can also track the following:
Do the customers go through product tutorials for successful onboarding?
Do they contact your support staff in case of problems or queries?
Are they looking into all the functions and aspects related to the product?
Time to First Value (TTFV)
Time to Value, or TTFV, is one widely used metric for assessing your onboarding processes. It helps you understand how efficient the onboarding experience is and how successful it has been for your company.
The metric covers the timeline between the sales and the time until your customer completes the onboarding process. That means when customers buy your product until they start using it efficiently without support or help.
So, of course, the shorter this timeline, the more successful your onboarding process. However, the time length also varies per product and company.
But again, with complex products, though the time will be longer, the value will also be higher. So if the perceived value and your TTFV are the same, your customer will likely stick around and be satisfied.
An increase in NPS Score
Net Promoter Score is one easy way to measure customer success. It's a simple process where customers or product users are asked to rate the likelihood of recommending your product to others.
The scale ranges from 1-10, where the customers who score from 1-6 are termed detractors. Those with 7-8 are neutrals, and those with the highest score of 9-10 are the promoters. The difference between the percentage of promoters and detractors gives you the net NPS score.
NPS is an excellent measure of customer satisfaction and the value your product gives your customers. However, there is one flaw; it's a number. You cannot always justify the user score, especially in the case of low scoring.
Revenue Expansion
Investing in new customers is 5 to 25 times more expensive than retaining your old customer base.
Expansion revenue is the revenue that expands on the initial purchase price or contract of a customer.
For example, an existing customer purchases the premium version of your product. Your business revenue goes up, and your productivity also increases. There are two ways to work on expansion revenue.
Upselling and Cross Selling
Upselling means introducing your upgraded or expansive plans to your existing client base. People must stay abreast of product upgrades and developments and opt for promotions.
Cross-selling means adding more features and benefits to the existing plan of your customers. This means instead of introducing new products and services, you make slight changes to the current model or plan and give that to your existing customers.
So, expansion revenue helps you achieve more profitability without costing you too much of your resources or price. You can scale up without generating more leads.
It works because your existing customers are 60-70% more likely to buy your product than new potential customers. So, there are many benefits to focusing on your expansion revenue rather than getting new potential buyers.
Net Revenue Retention
Net Revenue Retention, or NRR, is an important SaaS metric. It measures the expansion revenue of a customer over some time.
NRR considers things like customer churn, product upgrades or downgrades, etc. It gauges the organizational growth from the expansion revenue of your existing base. It also helps you identify areas of expansion revenue potential or areas where you can improvise.
Reduction in Churn Rate
The churn rate can be defined as the number of customers retaining your service versus the dropouts. Usually, a churn rate of 3-5% is alright.
It's the number of customers lost or the dollar value lost due to losing customers in a month. The churn rate can be calculated with a simple formula:
Divide the number of customers lost during the month by the number of customers at the beginning of the month and multiply the number by 100.
Churn Rate Formula
Source: WallStreetMojo
Bottom line: If you have good relations with your customer, your churn rate will be low.
Increase in Product Adoption
The product adoption rate measures how much the customers are familiar with and at ease with your platform. A high adoption rate shows that customers are happy and comfortable with the platform and have had an efficient onboarding process.
One of the best customer success strategies to increase product adoption is offering your customers freemium options.
Offering free trials to your customers shows how easy it will be for them to go from a free trial to the actual version of your product. The conversion rate is measured by dividing the number of customers using the free trial by those who buy the paid version.
A key to growth is trying to convert these free trial runners into actual customers who pay for the subscription and contribute to your business revenue.
One way to do it is to educate your customers about the benefits of your product. Tell them why they need the product and how they can use it. As a SaaS company, you can use product adoption to increase your customer base.
One important thing in getting more customers to adopt your product is the ease of the onboarding process. Customers who find a product or platform that's hard to use or complicated are less likely to stick around.
Customer Happiness Score
Every customer has different expectations, goals, and success factors. Hence, we have the customer happiness index to measure customer happiness at different stages on the customer's journey and product roadmap.
The index uses product usage, loyalty, and the level of product understanding and usage to measure customer happiness with the product. Remember that we are talking about customer happiness here, not just satisfaction, which is just a bare minimum for a customer to stay interested in a product.
Customer happiness reduces churn, increases loyalty, and generates much revenue for your company. However, measuring the customer happiness index is tricky.
Since happiness cannot be calculated based on a single metric, there are many factors you need to look at to understand the complete customer experience with your product. For instance, we have these NPS surveys with an 11-point scale to analyze the chances of your customers recommending you to other potential clients.
Drivers of Customer Happiness
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Your relationships with your clients have a lot of bearing on customer happiness. The more effort and time you spend educating your customer about the product, its benefits, and how it fulfills a need, the more likely they'll feel happy.
However, customer happiness cannot be measured at a single point in time. It is estimated over time, so your efforts must consistently ensure the customer stays happy with your product in the long run.
So instead of focusing on one grand gesture or action, invest time, making it a continuous investment in keeping your customers loyal to your brand. When they feel their needs have been met, they will return for more in due time.
Here are some key drivers for customer happiness you should keep in mind for your business's future growth and profitability.
Customer Support
Customer support is significant in customer happiness. Your customers are concerned that if they have questions or issues with the product, how fast can they get help?
They will become frustrated with the product if they fail to get the needed support quickly. If you have solid customer support, it can boost their confidence and trust in your brand.
The customers need to know they are being heard. They need to know their issues will be resolved, so as long as they get personalized attention, they will be happy and stay loyal to your product.
On the flip side, customer support also brings valuable information about the product and service for your company. By paying attention to the customer's concerns and suggestions, you can make significant changes and improvements to your existing products. That will ultimately increase customer happiness and loyalty.
Hence customer support creates a positive customer experience with your brand that leads to a high level of satisfaction, happiness, and loyalty.
Customer Onboarding
It is the process where you introduce your customers to your product or service and help them get on board using it. A positive onboarding experience can raise customer happiness levels by
Giving them clear expectations of the product or service.
Helping customers utilize the product or service quickly and to the best of its usability.
Offering a personalized experience to each customer, making them feel satisfied and happy with the product and service.
Helping customers get the most value from the product via a practical onboarding experience.
All in all, customer onboarding is a crucial part of customer happiness. With a clear, personalized onboarding experience, your customer has a positive experience with your product.
Renewals
Whenever customers renew their contract or subscription, they are happy and satisfied with the product or service. Hence, they continue to use it as they find value in it. Renewals show customer happiness in specific ways.
Trust and Confidence: When customers renew their subscriptions, they show confidence in your product or service.
Decreased Stress: Renewals can also help reduce customer anxiety and stress. They no longer have to worry about looking for new products or solutions for their needs. Plus, they also needn't repeat the onboarding process with a new product, which can be a rather frustrating experience.
Loyalty Boost: Customer renewals depict customer loyalty. Renewals increase the bondage or relationship of the client with your company.
Positive Word of Mouth: Satisfied and happy customers will recommend your product and service to others. Hence, increase your business and help you achieve your bottom line.
Pricing
Customers want value for money. They will feel happy if they feel they are getting good value for their investment. On the contrary, if they think they are paying more than they should, they may start looking for alternatives and consider switching to other products or brands. Here's how pricing affects customer happiness.
Perceived Value: Customers will be happy with their purchase if they feel they are getting good value for money. If the product is reasonably priced and provides excellent value, they will likely buy more from you.
Transparency: Pricing should always be easy to understand and transparent. If there are hidden costs or charges, that will only add to the confusion and distress.
Flexibility: Pricing plans can be flexible and customized per the customer's needs leading to more happy customers. Rigid and noncustomizable pricing plans are only annoying and distressing.
Competitive Price: Customers want a fair deal. They will make price comparisons, and if a price is higher than the market rates, it will become a somewhat dissatisfying experience for them.
Hence, it would help if you worked on generating positive customer experiences by offering competitive pricing, so customers stay satisfied and loyal to you.
UI and UX
User Interface and User Experience are important factors for customer happiness. Some ways these two elements can affect customer happiness are
Ease of Use: The product should be easy to use. Hence, the more effort invested in making a well-designed UI and UX, the more quickly customers can find what they need and complete their work effortlessly.
Design: The easier it is to understand the product design, the higher the customer's happiness level will be with the product.
Visual Appearance: Customers always want a product that looks appealing. Use UI and UX to make your product or service attractive and pleasant.
Consistency: If your product or service is consistent across all platforms and avenues, it will lead to higher levels of satisfaction among the customers.
Personalization and Customization: People love a product tailored to their needs. Properly designed UI and UX provide personalized experiences to clients, making the customers feel important and valued.
How to Improve Customer Success in SaaS
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How well the customers can use the product by themselves is the key to your business's success.
Often the initial customers are those that convert from free trials, and these customers are the ones that are likely to stick around.
Plus, they will also become advocates for your product in the future hence the need to invest in retaining these customers. Some key areas you need to focus on for SaaS customer success are onboarding, support, customer education, and data analysis of the customer's use of the product and their experience with it.
Here are a few ways to strategize and improve customer success in SaaS companies.
Develop a Personalized Onboarding Experience
Personalization is important as all customers are unique and want a personalized experience. Personalized experiences are engaging and, for years, have led to successful onboarding experiences.
However, personalization goes way beyond just learning the first name of your customers. You need to understand your customers' journey thoroughly. Their entire expedition starts from the moment they interact with your brand to achieving their end goal.
You also need to educate them about the benefits of your product and how it can help them achieve their goals.
Develop a Knowledge Hub to Educate Customers
A knowledge hub can provide customers with a self-service where they can resolve their problems independently without any support. It also helps your company as your support staff won't need to be as engaged with the customers and will likely increase customer satisfaction and happiness.
It also works as a training resource that will help the customers benefit most from your product. You may add webinars, tutorials, etc., to help customers understand and use the product to their advantage.
Another thing you can do here is providing them with bite-size tours. These short, focused tours give the customers an overview of the product’s features and usability. Bite-size tours are provided utilizing videos, short tutorials, etc., and help increase engagement and ensure smooth onboarding processes.
This way, since the customers will get consistent information, there will be fewer chances of ambiguity and confusion.
The knowledge hub can also be expanded to support your increasing customer base.
Collect Regular Customer Feedback
Collecting customer feedback is important to customer success. For one, it helps you identify key areas you need to improve. It also enables you to analyze customer satisfaction levels.
Getting regular customer feedback can help you track progress and identify areas to make changes in to improve your processes.
Moreover, it can also give you insights into the unique customer preferences and needs, so you can tailor your products accordingly to meet (preferably exceed) their expectations.
Remove Friction in Contacting Customer Success Team
The faster the customers can connect with your customer success team, the quicker they can have their concerns and questions addressed. This leads to increased satisfaction and improves the customer experience with your brand.
It also reduces your churn rate, as the customers will likely stay with a business that hears them out and provides support.
Customer Success Tools
If you are equipped with the right tools, customer success is easy. Customer success tools are software apps that help you manage and improve customer success. Here are two top tools that can help you improvise customer success for your business.
Totango
Totango is a customer success software that helps companies track customer behavior, the latest market trends, etc. Hence, it helps them identify flanks and take action to improve customer success. Totango has features like customer journey mapping, customer health scores, analytics, etc.
Evergage
Evergage is another customer engagement platform that helps SaaS companies offer personalized experiences to all their customers. Features include A/B testing, customer segmentation, real-time personalization, etc.
Final Thoughts
As a SaaS company, customer success strategies are pivotal to growth. It doesn't mean you no longer need to generate new leads; you always need new customers to expand your base. But that shouldn't come at the cost of losing your existing clientele.
So, deploy these tools for measuring, keeping tabs on, and improving areas where you can for customer success.
Consider them an investment to save your customers and fur future profitability and growth.
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