How Successful Startups use Customer Success

For many companies, especially those providing SaaS, most of the revenue derived from customer relationships is produced post-sale.

It therefore makes sense to focus on both retaining customers for as long as possible and developing these valuable customer relationships. Customer requirements and expectations change over time, so it’s important to remain highly aware of how needs and desires evolve and to support these ongoing developments.

Startup enterprises that pay close attention to customer success have an immediate advantage over organisations that remain focused upon sales and marketing. A business approach that is based upon customer success is far more likely to succeed in an increasingly competitive marketplace.

Focus on Retention

Customer success is rightly focused on customer retention as businesses that focus on retention grow much faster than their competitors. By marketing to existing customers, businesses are making as much as 2.5x more than their competitors in their first three years.

But marketing to existing customers only works if those customers are happy and have already experienced success using the supplied products or services.

Know Your Customers

A key requirement for all business startups is to know exactly who your customers are. Developing a deep and productive understanding of your customers, why they are using your products or services and what they are aiming to achieve are fundamental aspects of driving customer success. Through customer research you should be able to answer the following questions:

  • Who are your customers?
  • Why are they your customers?
  • What are they aiming to achieve?

Of course, not all customers are the same. So it’s a good idea to develop a group of representative buyer personas that encapsulate key attributes.

Develop Buyer Personas

There are many ways to build a collection of representative customer or buyer personas. Demographic data including age, gender, income, geo-location, occupation, interests and preferences provides a good foundation. But you need to answer various qualitative questions such as:

  • What motivates customers toward finding your business?
  • What does your customer aim to achieve with the supplied product or service?
  • What attributes of your product, service or company are important to customers?
  • What has your customer disliked about other suppliers in the past?

Gathering this type of information can often best be achieved through interviews and customer surveys. By assessing various distinct customer groups including new customers, long-term established customers and customers who have made repeat purchases, you can gather valuable insight that supports the definition of truly representative buyer personas. Implementing exit surveys is another valuable tactic that should provide some understanding of why customers and prospective customers are leaving.

Define Their Goals

Having defined a collection of representative customer personas you need to consider exactly what it is they want to achieve by using your products or services. This is where further interviews and customer surveys are beneficial. Conducting both interviews along with customer surveys is a good idea as using just one technique is unlikely to provide an unbiased, accurate result.

Identify Success Gaps

Having gathered this valuable information describing who your customers are and what they want to achieve through using your products or services, you are now able to identify where success gaps exist. A success gap refers to the difference between what your customers and clients want to achieve and what your product or service is capable of delivering. Identifying and then filling these success gaps represents a significant opportunity for startups to support customer success.

An example is a software product that allows users to create and manage social media PPC adverts on Facebook. Customers will have specific goals and expectations in mind when creating these advertisements and if these are not achieved they will not be successful. While your product might be doing a great job in helping them create and manage their advertisements there is clearly a gap between this functionality and the ultimate outcome that the customer desires. By getting to know exactly why the customer is running advertising on Facebook and then helping them to create effective adverts you will have gone beyond the basic functionality of the ad-management tool to recognise what constitutes customer success and to help your customers achieve this while using your product. This will make a huge contribution toward retaining this customer and potentially selling them additional products and services in the future.

Define Customer Success Milestones

Milestones are simply markers used to track progress toward a defined goal. Having identified the goals that customers want to achieve when using your products or services you should be able to describe the paths they are likely to follow toward achieving these goals. For example, a software product may require installation, configuration and validation. And there is likely to be a learning curve that needs to be scaled in order to make full and effective use of the product.

By defining these milestones, which can then be customised for each specific customer, progress toward achieving success can be monitored. Each step in the journey would be recognised by the customer as a valuable step toward success.

Prevent Churn

As noted, customer retention is a primary goal of customer success strategies. By engaging with customers to fully understand them, their motivations and their goals you will demonstrate the added value you provide through collaboration. This will contribute to a lower churn rate.

During the early phase of a new customer relationship you will set the stage for your ongoing relationship. First impressions have an enormous impact so it’s imperative that new customers don’t encounter negative experiences. Taking time at this stage to make certain that customers are fully guided and supported along the path toward success will reduce the likelihood of early churn.

It’s important to set realistic expectations and not to over-promise as this will inevitably lead to frustration and dissatisfaction. It’s important that everyone dealing with a customer is fully aware of what success looks like for that customer and the strategies that are being used to get there. Setting and communicating realistic expectations will minimise the risk of disappointing customers and provides the opportunity to exceed expectations and delight customers.

Customer Success Drives Startup Success

Any startup enterprise that fails to pay adequate attention to customer success will suffer the consequences. The high cost of attracting new business along with the costs associated with losing customers eat into narrow profit margins and any negativity, in the form of poor reviews and online comments, can be enormously damaging.

By establishing a customer success based approach from the very beginning, business startups can establish a valuable foundation that will minimise customer churn, maximise retention and drive ongoing sales.

Give Customer Thermometer a trial and find out how your customers feel! You will quickly see how easily implemented, simple surveys deliver great response rates that will improve your customer experience.

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