Customer Success: The Definitive Guide

Customer Success- The Definitive Guide 2016Customer Success is transformative.

Whether you have a subscription business or you sell one-off products or services and simply want to do business with your customer more than once, Customer Success should be your driving purpose.

In the two years since I first published this “Definitive Guide to Customer Success,” the transformative power of Customer Success has shown again and again.

Customer Success has its roots in the Software-as-a-Service (SaaS) world and my original definition was very much SaaS-centric.

But since then, companies that are not SaaS, or even technology companies at all, have recognized the transformative power of Customer Success and embraced it as their new operating model.

If you aren’t familiar with exactly how Customer Success is transformative, I’ll lay that out for you below in great detail in this guide.

I don’t know what will happen with Customer Success in the next couple of years, but I wouldn’t be surprised if sometime down the road we’re no longer talking about “Customer Success” as a separate function within a business, but simply as part of the way you do business.

Even today that’s how you should view it.

Why? Simply put; No Customer Success = No Your Success.

You make sure your customers are successful and they’ll make sure you’re successful. It’s a Win-Win!

On the flip-side, if your customers are not achieving “success” with your SaaS, your success is at risk.

Of course, what “success” looks like for your customers is 100% unique to your customers, in the context of your product or service.

So while there’s not a one-size-fits-all definition of lower-case customer success – that’s up to you to know – as far as the concept of upper-case Customer Success is concerned, I’ve attempted to define that for you here.

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The Only Two Reasons Customers Churn

The Only Two Reasons Customers ChurnChurn is the antithesis of growth.

When you lose a customer, in order to grow by one customer, you have to first replace that customer you lost, and then add a new customer.

And when a customer leaves, they take the revenue they were paying you with them (often to a competitor!); but they also take other things, like negative sentiment, your employee’s morale, ammunition for the competition to use against you in future deals, and much more.

You know churn is bad, I don’t have to convince you of that. (Right?)

What’s even worse than having churn is not knowing why your customers churned. That’s why I say you need to know why each customer churned so you ensure no customer ever churns again for those reasons.

But I want to be clear that, whatever reason your customer gives you for why they churned, the details uncovered by your internal tracking, or (ideally) both, it all fits into one of two categories.

Let’s dig in…

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You Have to Know why Your Customers Churn

You Have to Know why Your Customers Churn

When customers churn, that’s a problem.Even if their churn was “unavoidable” it still hurts.Churn hurts on several levels: from lowering revenue to hurting employee morale.And churn means something happened to the customer (out of … [Continue reading]

Pricing Strategy Framework for SaaS Startups

pricing-strategy-framework-for-startups

Pricing doesn't exist in a vacuum and is therefore not something you can tackle on its own.Pricing is a function of marketing and determines, among other things, your market position. It also indicates - or is ideally derived from - the type of … [Continue reading]

Qualifying Leads in a SaaS Free Trial

qualifying-leads-in-a-saas-free-trial

I got this set of questions on Twitter: "Is there a certain level of activity during the free trial that is likely to predict conversion from free to paid? Also, how do other companies handle Sales vs. Marketing Qualified Leads (SQL vs. MQL) when it … [Continue reading]

Customer Success and Logical Account Expansion

customer-success-and-logical-account-expansion

Customer Success is a powerful growth driver.Sure, in the early days when you're putting out the fires of churn, Customer Success seems less like a growth driver and more like a stop shrinking driver.But once you move past churn busting - or … [Continue reading]

Reasonable SaaS Free Trial Conversion Rate

Reasonable Free Trial Conversion Rate

What's a reasonable conversion rate from free trial to a paid customer?I get some form of this question from time to time and I've answered it several times over the years.Well, I got it again so it's time to revisit this very simple … [Continue reading]

Acceptable Churn Rate for Small Accounts

acceptable-churn-rate-small-accounts

What drives a company to focus on Customer Success is changing. In the past, churn (or retention, depending upon how you look at things) was generally the catalyst.Once churn is under control, the catalyst changes to expansion; driving use, … [Continue reading]

Success is Uncomfortable

success-is-uncomfortable

I've talked before about holding customers accountable and how customer success isn't about making customers happy.Sometimes you have to push customers out of their comfort zone and - if you'll allow me to channel my inner Tony Robbins -progress … [Continue reading]