Customer success objectives
Before a company even has customers, customer success is one of its main goals
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Qualification is important to bring the right customers
In the first step of the customer success process, qualification is critical to ensuring that you bring on the right customers.
In order to start solving a problem for someone, you need to understand and define that problem. In order to do that effectively for a customer, you need to understand and define who your customer is. This can be expressed in simple terms as:
Qualification = defining the problem AND defining the customer
Most companies have a system or process in place to qualify new leads or opportunities before they are brought on as customers. At its core, this is an attempt at qualifying potential customers.
But what I see frequently with many companies is that they rush through this qualification phase because they’re anxious about getting a contract signed and revenue generated from new customers.
However, when you start skipping steps in your qualification process—or worse yet when you don’t even have one—you end up bringing on customers who aren’t ready for your product/service or who aren’t a good fit at all. And when this happens, it usually means that these unqualified customers aren’t going to achieve their desired outcomes or be successful with your product/service (at least not anytime soon).
A useful methodology to qualify customers is called BANT, which stands for Budget, Authority, Need, and Time. In summary, you want to make sure you are talking to the right person (authority), that this person has a budget that meets your pricing, that you know what the person/company needs (and that your product can give them that) and, finally, you know when they are planning to make a decision. This will help you prioritize your efforts and focus on the right prospects.
Customer success starts even before the sale
Before a company even has customers, customer success is one of its main goals. After all, if you don’t have customers, you won’t be successful for very long. That means that the first goal of any customer success team is to make sure that the product being sold is great and that it will attract the type of buyer who needs it.
Once your product hits the market (and, hopefully, starts flying off shelves), it’s important to keep in mind that customer success isn’t a one-time goal. It’s an ongoing process of making sure customers get as much value out of your product as possible. Customer success comes from making sure they understand how to use your product correctly so they can achieve their desired outcome.
Customer success managers
As a customer success manager, you’re a brand ambassador, the eyes and ears of the customer.
You need to be well-versed in our product, understand how it works, and know how to use it to service your customers.
Customer success is the voice of the customer.
Understanding customer behavior and predicting outcomes are the way to grow your business
Customer success involves understanding your customers. It is this understanding that will allow you to guide them through the customer journey and ongoing engagement. The only way to understand your customers is to look at their behavior, not just their stated needs or wants. By analyzing customer behavior, you will be able to predict outcomes and make decisions based on this data that will improve your company’s results.
The first step in understanding customer behavior is by gaining an understanding of what your customers value. The second step is by knowing where they are within the customer journey.
Lastly, an understanding of how your customers feel about you can inform whether or not they choose to renew with you vs someone else next time around.
How to measure success for a customer success manager (CSM)?
Customer Success KPIs are the metrics you can use to measure success in your Customer Success Management organization.
While they’re difficult to track, both CSM performance and success can be measured via KPIs and other metrics.
What models do CSMs use to measure their own performance? How do they define their own goals? What is a good way to evaluate how well a CSM is doing at work?
Measuring CSM performance is about successfully measuring long-term goals in short-term milestones
Let’s take a look at some of the various ways you can measure your CSM’s ability to retain customers, grow revenue, customer product usage and customer upsells.
- Renewal rate – The percentage of customers who renew their contract or subscription with your company
- Net Promoter Score (NPS) – Measures how likely customers are to refer your product/service
- Churn rate – The percentage of customers who don’t renew their contract or subscription with your company
- Overall usage/adoption -The increase in the number of users feature usage, and adoption over time by segmenting organizations into those that have reduced churn or didn’t churn over a certain period
- New business MRR- Monthly Recurring Revenue from new business within an established base.
Product health and usage metrics should be used as leading indicators of future activation, and thus retention
Product health and usage metrics should be used as leading indicators of future activation, and thus retention.
Product health and usage metrics can be used to judge CSMs. Product health and usage metrics are the most effective metrics to use for future activation and retention
Do not use one metric alone as it would be flawed and can lead to poor decisions
You should use multiple metrics to determine your ideal customer success objectives.
Using one metric alone is flawed and can lead to poor decisions.If you use only a single metric, you may end up making poor decisions. For example, if you measured success with only the number of new customers acquired each month, it would be easy to get lulled into a false sense of security.
The best way to solve this problem is to never use one key metric in isolation. This will always give you a flawed view of what is happening with your customers because there are multiple factors within different areas of the business that determine overall engagement, health, adoption, and growth across a customer base.
Instead, focus on long-term goals like driving higher lifetime value from each account and use short-term metrics from multiple areas of the business to measure progress towards those goals.
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