When you get that endorphin rush from seeing a sale you may think you’ve won a customer. If everything’s gone right, you’re absolutely on the way to a relationship that might last years and will produce great things. More frequently the purchase is just the beginning of the process of moving from trial to loyal (and avid) customer.
Think of this example – if you had a lemonade stand and someone showed up once to purchase a refreshing drink, would you think of them as a regular customer or someone who showed up needing lemonade that day? Their needs for a cool drink could be related to the outside temperature, hydration after a long walk, or a need to try the most talked-about lemonade on the block. But the first day they show up at your lemonade stand, a buyer is not a customer.
Now think forward, and imagine that for several hot weekends in a row you’ve seen the same person. You know a bit about the time they show up, how many cups of lemonade they buy, and perhaps have made chit-chat and talked about something more than the weather. You could definitely call this person a customer, but not yet a loyal buyer. You don’t know when the lemonade stand around the corner will come calling.
When the same customer shows up on a rainy day, asks you why you haven’t opened the lemonade stand, and presents you with a few ideas for other things you could sell (“psst – Brownies go extraordinarily well with a cold glass of lemonade”), you’re well on your way to earning a Customer For Life.
It continues with dedicated service
Why did your customer come back? Undoubtedly you’re not the only lemonade stand in the neighborhood. And you might not even be the cheapest. But people are creatures of habit and want to know where they are going to make a purchase with someone who cares about them and what they think.
Learning more about your customer and the key drivers of their business is the single best thing you can do to build success. Not “success” in the traditional sense where you measure the sheer dollar amount of the contracts you bring in and the quotas you make. I’m talking about success as defined by the raw ability to understand why your customer is hiring your company and to translate that into the products and services you deliver for them.
Success might mean not selling to a customer today until their business has matured to the point where they really take advantage of your solution. Success might mean highlighting the single feature in your product that – no matter how they use it – will improve their business so that they talk to other people about you. Success might mean calling a customer up just because and saying “hello, I’m calling because I wanted to know more about how you’re doing and how I can help.”
Success Grows with Your Understanding of The Customer
It’s easy to think you know your customer. They bought something from you, after all. Isn’t that enough? But remember that their business is changing and developing at the same time yours does too. The solution that worked for them months or years ago might not work as well for them now for the needs they have today. Or perhaps, the reason they bought your product hasn’t changed a bit.
The point is that their business – like yours – is not static. You need to keep on asking the customer what they think, why they continue buying, and what they need to really succeed. The capital S in Success stands for Solves Their Problem. Which problem did they hire you to solve?
Which Job do they want done? Learn more about that and then next time a customer asks you for your answer, you’ll be able to speak simply in the words of a customer just like them.
When you are building a great business (particularly a Saas business), you need to devote extra time to taking care of your customers so that they not only are satisfied at the sale, but also on an ongoing basis. A customer may join you because of clever marketing, a consultative selling process, excellent product, or empathetic service – or a combination of all of these factors. They may also want to leave for many reasons that are (at least temporarily) out of your control. Keeping the customer, understanding their needs, and communicating those ideas to the product and engineering team is the job of the Customer Success team.
So what is Customer Success, really? I believe Customer Success is a hybrid of traditional ideas for support, account management, customer on-boarding, and sales. The best Success teams work hand-in-hand with dedicated Sales, Support, and Marketing teams to guide the customer from initial awareness through consideration to trial, buying decision, on-boarding and implementation, and ongoing success.
Why call it “Customer Success” instead of Account Management, Support, or Customer Service?
These department names and functions are well-known and often misunderstood. Customer Success implies the support and service offered by traditional Customer Service teams and the speed and flexibility of Account Management and Sales. “Success” in this model does not mean that the Customer is successful all of the time – it means that we are successful in finding an amicable (and hopefully awesome) solution whenever someone needs help. It’s not just the transactional “help” of “how do I find this feature that I’m looking for” but also the consultative relationship you forge with a great salesperson and account rep who can always seem to get you what you need.
How do you build a great Customer Success Team?
It starts with a lead who has done this sort of work before. It’s often possible for a Sales Leader to move into this role if she’s had past experience supporting clients, or a Customer Service Leader to add account management to his skill set. But the best head of a Success Team is someone who has been on the front lines bridging the gap between sales and service for a while, in a variety of industries, for a variety of account sizes.
The team that Customer Success Leader builds should have Account Management and Customer Service functions – that doesn’t always mean that the person will need dedicated teams for those functions. Jason Lemkin suggests that “most SaaS companies use a rough metric of 1 Client Success Manager for every $2m in ARR.” For a smaller average deal size you might need a few more people to keep things going and it’s a good metric to use to measure team performance.
What team do you need?
Think about Lemkin’s model of client success and consider using it to plan a “Team effort” for each $1m in ARR. For your first $1m in ARR, you will probably need only two people: one who focuses on Customer Service and content for new customers, and one person who manages the on boarding and engagement of new and existing customers. As your customer base grows, use the metric of about 50-100 interactions/daily for Customer Service and 100-500 Accounts for account management to size your team.
Equip your team with tools
You’re going to need a combination of management and nurturing tools to deliver service and account management. As your service volume goes up, you’ll want either a lower-end tool like Zendesk or Desk.com or a higher-end solution like Salesforce to manage your service interactions. For automatic and real-time engagement, I love Intercom – it’s a great hybrid of programmatic marketing tools and the quick touch transactional tools found in service desks.
Your goal should be “no customer left behind”
When thinking about how you manage that Customer Success team and make them a great team, consider how it feels when you get great service and know exactly who to call: it feels great. Whatever approach you use to engage customers and whatever policies you have to govern your customer interactions, the customer should be at the core of that experience. If you need to measure results (and you do), keep your eye on Net Churn. The results of keeping more people even while the top line customer growth increases really helps the team accelerate.
What results should you expect? Great customer teams are accretive to a great sales and marketing team. By keeping more customers and by helping the sales team with the critical task of expansion revenue and retention, great Customer Success teams deliver results.
When someone calls you to discuss a product you just signed up for, how do you feel? Depending upon where you are in your buyer’s journey, you might welcome the call, feel ambivalent, or be annoyed that the company called you at all (especially if you haven’t yet given them your phone number). What often happens is a mismatch between the relationship strength — the relationship between you and the company necessary for you to have a good experience with their product — and your goals. Likewise, the transaction cost — the effort required for you to experience the product enough to know whether you’re ready to buy — may also be fundamentally misplaced.
A great (first time or otherwise) product experience matches the relationship strength needed by the typical customer. How much help will the customer need from you to get what they need from your product? This product experience also matches the transaction cost that customer expects. Is it too much work for the customer to do the work they need to do, with or without your help? Answering these two questions helps you scope your investment in your product to focus on sales, marketing, or product efforts. Is the relationship effort and cost needed small — like when you try a free product that might not bring you immediate benefit — or is it quite high? You might be auditioning to solve a pivotal problem for a large business while working on a deadline. Continue reading →
We are all very busy. When someone asks for our attention, we want a show. Not just a “dog and pony” show, but a real experience with a tight structure, strong production values, and a Big Finish that we can record for posterity. Pop Stars have it down – they know that a customer’s experience with a single song has to translate into a customer experience that reinforces the brand. The key insight is that we don’t want to have our time wasted and we want the time we invest in an experience or a product to have value that extends beyond that experience itself.
What’s the first experience customers have with your product?
Think about the encounter with your product as a show. At Disney Parks, management refers to the customers as guests and the employees as on stage talent to help everyone know that the experience is a magical (and also fragile) construct where the guests want to be entertained and the employees do their part to make sure everything seems right. This is the exchange customers make for their time: show me something of value and I will commit my time, energy, and effort into seeking and finding that value.
The first time a customer uses your product, they need an easy task that demonstrates immediate value so that they will want to come back. A common way to accomplish this is to use the customer’s own information (connect your Twitter handle, enter the name of your web domain, or even the most basic tell me the preferred name you wish to be called) because it’s more likely you will get that information right. Get the first customer interaction right, and the customer will come back. Give them garbage, and you lost the chance to be considered in the future.
How do you set the stage?
In a rock show, there are roadies and advance personnel that ensure that the stage is set “just so” and that the experience in-theater (or stadium or venue) is similar to the way the talent practiced. There are rituals (the opening act, the lights, the backing music) that help prime the audience for an experience. And there are built-in mechanisms for checking audience participation (the welcome “HELLO CLEVELAND” to indicate a special experience in your town, the encore for making sure that you know the singer appreciates you). All of these actions set the stage for a great customer experience.
Setting the stage for a product involves setting the stage, suggesting a clear and immediate benefit, and then showing the way with the minimum of gates to take customer through the sign-up funnel.
The best sign up pages have a Sell (“try my product”), a Benefit (“When you try my product you’ll get this immediate benefit”) and an Action (“Get the benefit by signing up Now”). Here’s an example of a few pages from the Pinterest mobile UI that do this well.
Not everyone has as clear of a benefit as offering beautiful pictures in a free product (and therefore has quite a low barrier to entry) but the principles for any business should be crystal clear. Show (don’t tell) the customer the benefit; Demonstrate the easy steps to get started; and Ask the customer to participate.
Add an Easy Button if You Don’t Have One
Customers – as we’ve said before – are really busy. That means your product needs to be dead simple to start, even if the insights you deliver and the value you aspire to is less than dead simple. Start by listing the reasons the customer should try your product today, and keep them simple. One, two, or three benefits are probably as many as people can handle in one go (model your pitching on the idea of short-term memory – we can hold only 5-7 items in that memory and a few of them are probably already busy right now).
Make the first win easy, and then start sharing all of the insight and benefit your product gives in an easy to use format. For many people this is still email. Email wins because it is asynchronous, can be opened in many clients, and is reasonably easy to produce. Email loses because people have too much of it and they just don’t like to read.
Remember, customers are busy. Their time matters. Provide more value in less time and create a great experience that inspires them to share and they’ll come back to see more.
How do you define influence? Simply put, it’s the ability to ask for something from others and have them follow through on your behalf. Following through could mean completing a specific action – like “share this article” or “buy this product” or “try my product” or something more subtle, like “recommend this to your friends”. Or it could mean something a bit more complex, like “make sure that people whom you know will think of our [brand] or [idea] when they consider others in the same type of product or brand”.
Influence is not just the ability to ask – we do that all the time – but also the forecast that you will be able to count on people to take action on your behalf. It is a tremendous force that needs to be used judiciously (as Stan Lee said, with great power comes great responsibility), and it can disappear quickly with the wrong ask.
What are influencers?
Influencers are individuals who persuade people to take action (including purchase decisions) through their authority, facts, charisma, or relationship.
If you don’t know what this feels like, try advocating for a brand or a service or an organization that you respect and use. Try pitching their goods or services to a friend, and see what the reaction is like. You might find that you do this every day, or it might be unfamiliar. Sharing a recommendation is a powerful way to help others. When that recommendation is a good one, it’s wonderful positive feedback. When that recommendation is not acted upon or when the person says, “not for me” it’s also great feedback that you need to refine your pitch or pick the person more carefully.
Influencers may also be brand advocates (highly satisfied customers) and are more credible to consumers when they are knowledgeable consumers and wield influence.
People engage in these activities because they feel intrinsic motivation (satisfaction from just the action of helping someone out) or extrinsic motivation (sharing content that is popular can make you more popular, or a trusted resource, or a linchpin for a process). Finding the key that makes people respond due to intrinsic motivation leads to a stronger bond.
What are some of the reasons someone might be an influencer?
Influencers engage typically because they share an affinity group (perhaps an alumni group from a university); a place (geography); an activity (athletic or otherwise); or an interest (may overlap with activity or be distinct – a combination of one of the other types).
Influencers share information to help their communities; to gain influence themselves; and to be a source of knowledge and information.
What can you do to help them understand what you do?
Start by putting yourself in their shoes. WIFM (What’s In It For Me) is a good acronym that helps you think about why they would want to take action on your behalf:
When do you need them to do it? Have you given the person enough time to consider what you’re asking them to do and have you made it very easy for them to comply? Have you asked them to do anything else recently?
Why should they do it? Does your action present an obligation for them and are they putting their reputation on the line by completing your task, or are you simply asking them to share information?
Then, THANK them for taking action on your behalf – and do it in a way that matches the communications you’ve had before. Not everyone likes being thanked publicly. You might send an email, a card, or pick up the phone. You might send a tweet. And you might say hello in person and buy that person a cup of coffee. The point is to display gratitude – to let that person know that their action mattered – and to help them stay motivated to help you in the future.