Products get built, products get sold and then Service steps in to take it from there. At least that’s how it used to work.
Now – as an industry – we are aware that it’s a good idea to help customers use the products they buy, and it’s even better if we can make certain that customers are successful.
So now that the industry is buzzing with talk of customer success, what does it mean for Services?
Who better than Services to understand the challenges customers face in using products and the gratitude that can be earned by helping them. It’s time for Services to take a leadership role in driving the principles of customer success across the company.
Service organizations are in a unique position to drive customer success initiatives. It is not enough however to stop at the edge of the Service silo. For customer success to be fully effective other customer facing departments need to embrace success-oriented principles.
What should customer success look like at your company?
- Sell quality products that have the features and performance customers need.
- Onboard customers to help them use and apply your products.
- Teach customers to be proficient and support them when they need help.
- Demonstrate that your products are indispensable and accelerate customer outcomes.
When customers use your products effectively, they do not churn and are prime targets for renewal and expansion opportunities.
The principles of customers success are well documented, and many companies have already launched initiatives. Yet, more than half of companies surveyed by ServiceXRG indicate that customer success is an activity within a single department, most often within Services. Customer success must be a company-wide effort. Sales, Marketing, and Product Development all play critical roles.
The Leadership Role for Services
Services organizations have been in the business of customer success for decades and many are actively engaged in success initiatives today. Services can take the lead and make the case for customer success company-wide.
Look to renewal rates, ARR/MRR growth, NPS and satisfaction as indicators about that current impact of customer success. If you don’t have the data now, begin collecting it.
Highlight the activities that yield positive customer outcomes (onboarding, success planning, account management, etc.) and those the create customer angst (poor product quality, sales and service policies, poor hand-offs between departments, etc.).
If you would like to discuss how you can develop a compelling justification for implementing or expanding customer success at your company give me a call.
The Meaning of Net Recurring Revenue
Measuring Net Recurring Revenue provides a clear indication about the extent to which recurring revenue is growing or declining. The more important insights from this metric come by examining the reasons for growth or contraction of Recurring Revenue. Consider the following when examining Net Recurring Revenue:
- What is the trend in Net Recurring Revenue – growth or contraction?
- What is the rate of rate of change in growth / contraction?
- What are the primary reasons for loss of recurring revenue – loss of customers or contraction or exiting of relationships?
- What are the primary factors that contribute to revenue gains – new relationships or expansion of existing relationships?
The type and magnitude of changes to Net Recurring Revenue Rate can provide important insights into the reasons for changes to the value of customer relationships. Use these insights to develop strategies to stem customer churn and reduction of contract value. Build upon practices and circumstances that lead to new customer engagement and growth of existing relationships.