The relationship between company and customer has gone tremendous change with the advent of SaaS companies. When customers used to be treated as an outsider by the traditional companies, in B2B SaaS companies, they are treated as no less than a partner. Companies have increasingly realized that building long-term relationship with customer is the key to their success.
Having a long-term customer is not a “good-to-have” feature anymore in the modern SaaS companies. They have to work together and give continuous support to their customers in order to remain competitive in the marketplace. The lower switching cost to another vendor has made it even more important for companies to think of better strategies towards customer retention. They have started taking special consideration for customer retention and even invest separately to fulfill this goal.
This has given rise to the new department and philosophy called customer success. In the last ten years, B2B SaaS companies have started considering customer success as their key growth machine and it will continue to rule the SaaS world as long as the customers matter to a company. And that’s an eternal truth.
So, how you can leverage the power of customer success for customer retention and what outcomes does it produce? We are going to see this in detail in this blog. Let’s look into the five steps you can take towards customer retention in your B2B SaaS company.
Flawless onboarding
The foundation of customer relationship starts from the very beginning itself. Your marketing and sales team has done their job already to bring you the customer. How you treat this customer onward defines your relationship with them for the rest of the customer journey. But not to miss, it is equally important for the marketing and sales team to select the right fit customer. There is no point in selecting any customer through false promise just to fulfil your targets.
So, once you have started with a new customer, your onboarding program would decide how your customer feels about your brand from the initial stage. This is how you must execute your onboarding successfully.
Proper Introduction
Customers must be introduced with the right stakeholders with whom they would be working forward. Customer success manager must step in at this stage and introduce himself along with the technical specialists who would do the product configuration for the customer. An account manager can also be a part of this introduction
Customer training
Customer training is an important part of onboarding. A manual walkthrough of the product or an online video tutorial must be shared with the customer depending upon the complexity of the product.
Strategic discussion
A CSM must hold strategic discussion with the clients about their goals and objectives. They must set their expectations clear right from the beginning and inform clients about what can be achieved through the product and also what not.
Effective Engagement
Another important step towards customer retention is having an effective engagement with the clients during their usage period of the product. Most of the companies, after the customer purchases the product, leave the customers to themselves. They interact only when customer needs any help or raises a ticket. This is detrimental to customer relationships. To maintain a positive relationship with customers, you need to be proactive in your engagement. Customers must feel that they are always taken care of by their vendor who also is like a business partner.
A CSM can keep an effective engagement with customers through the following steps.
Monitor usage
Through a customer success platform, a CSM can keep a watch on the customer’s usage of the product. This would inform him about where the customer is going wrong in his usage and how he can enhance their experience. For example, if a customer is using only 4 out of 10 features then a CSM must know that and must take necessary steps to enable product adoption.
Improvise touchpoint management
Although it is not possible to maintain high-touch engagement with every customer, an expert CSM must know when to use high-touch or low-touch in different situations. A new customer needs more attention so a high-touch engagement can be deployed. Whereas for the customer who has already adopted the product, a low-touch engagement would suffice.
Demonstrate value at different levels
There might be multiple stakeholders at the client-side with whom your CSM has to maintain relationship. A successful CSM knows in what terms they need to communicate with different stakeholders. C-suite executives must be shown the business value of using your product. They are more interested in knowing what business value your product is providing. That value can be in terms of revenue growth or cost-saving.
Likewise, the mid-managers are more interested in knowing how the product is enhancing their operational efficiency. Are they able to meet their business goals through the product? A CSM must demonstrate the product’s capability in these terms.
And finally, the end-users of the product should also realize the value of the product. They care about how the product is making their workflow smoother and more efficient. By using the product, how can they get their task done with the least amount of effort.
The decision to remain in business with a vendor comes from all levels. Every individual sees value through different lenses in your product. And for customer retention, it is essential that you foster a positive relationship with every individual in the client’s company.
Use essential metrics
Business outcomes are useless until they are measured and demonstrated to the higher executives. Customer success metrics like retention rate, adoption rate, daily active users (DAU), monthly active users (MAU), must be measured from time to time. Let’s have a brief glance at few of these important metrics:
- Retention rate: this measures the rate at which you are able to retain your customers. This is important to check from time to time to know how well your product is accepted by the customers you acquire.
- Churn rate: This shows the rate at which your customers are leaving you. When the churn rate is high for a month or a quarter, you must immediately do the churn root cause analysis and fix the issue that is causing the churn.
- Adoption rate: This is the rate at which your customers are adopting your product. How long does it take for them to adopt the product? What are the common barriers that are preventing the customers from adopting your product? These insights must be brought forth for further prevention of churn.
- DAU: Daily active users are the number of users that are logging into your product on a daily basis. This gives you an idea through which you know how engaging your product is. Through this, you can also predict how long will it take for your product to become an integral part of their business ecosystem.
Business expansion
This is one of the most proven customer retention strategies. The logic is simple. To retain the customer for long-term, you need to increase your footprint in their domain. That means, you need to make them use more products of your company. The more products they use, the more likely they would stay in your business for the long-term.
A CSM must be adept enough to anticipate the growing needs of their customers. Customer needs evolve over time as they get more immersed into the B2B SaaS products. A vendor knows this well beforehand. Hence, they have a bulk of ancillary products to enhance the usage experience of the customers.
When the customer has already adopted your primary product, you must approach them for upsells and cross-sells. The more deeply they are engaged with your product catalogue, the least likely they would switch to another vendor in future.
Final Thoughts
Customer success is the key to customer retention. They are the two sides of the same coin. Any company with a robust customer success structure will have a proven record of retaining their customers for long-term. The art of relationship management has evolved over time. There is no more reactive approach that a company must keep with the customers. They have to be proactively engaged with the customers to serve them with utmost quality.
The experience with the product also plays a crucial role in customer retention. The product features, UI and dashboard should be designed in such a way that it facilitates a gradual immersion of the user in it. The users start with the simple features and as they mature with the product expertise, they get more accustomed to the advanced features of the product. And once they have started using the product seamlessly and realizing the continuous value from the product, customer retention becomes a natural outcome.
Author Bio
Jafar Sadhik is a passionate digital marketer possessing sound knowledge in the fields like SaaS tools, CX, churn statistics, etc. Previously, worked for top ventures like SportsKeeda and Neil Patel Digital India, and currently works at SmartKarrot Inc. He loves to read books during leisure and a great admirer of Agatha Christie’s works.