Tag: Customer Success

Maximizing Customer Retention: The Role of Key Account Management in Customer Success Management

In the business world, customer success management is no longer an afterthought; it’s a necessity. Consensus across research confirms: retaining existing customers costs 5 to 25 times less than acquiring new ones. But businesses are realizing that it goes beyond keeping customers satisfied; it’s about truly understanding their needs and delivering value at every touchpoint.  The rise of the digital era has changed the rules of the game. Complex products, multifaceted needs, and fierce competition have become the norm. In this context, a one-size-fits-all approach no longer works.  Success lies in a tailored, strategic approach to customer success management. One that leverages Key Account Management (KAM) principles to retain customers and transform them into brand advocates. KAM principles encompass fostering robust relationships, tailoring solutions, maintaining consistent communication, prioritizing the long term, and constantly reviewing and adapting strategies. This journey requires a keen understanding of your customers, insightful data, and a commitment to going the extra mile. And it’s a journey that pays off in spades.  Read More: What is Customer Centricity and Why it isn’t the destination? The Changing Role of Customer Success Managers / CSMs in a Technological World “This season is an opportunity for the CSM to shine.” (From episode #9 of The Shift podcast). In today’s ever-competitive business environment, customers expect consistent value and support. Customer Success Managers (CSMs) play an indispensable role in ensuring this. But their role goes beyond just implementation or ensuring customer satisfaction or customer retention.  The changes? Multi-faceted roles – serving as advocates, advisors and educators. Guide customers through complex technical platforms and maximize value Ensure smooth adoption of products or services CSMs are often tasked with understanding intricate technical platforms and ensuring that customers can effectively utilize them. The platforms they deal with can vary from sophisticated data analytics tools to advanced customer relationship management systems. However, despite technological challenges, CSMs are the ones who ensure that these tools deliver value to customers. Learn More: Best Customer Segmentation Strategies for Customer Success Teams Strategies for Sales Growth with Existing Customers: Avoiding Pitfalls Organizations often fall into common traps when trying to drive sales growth with existing customers. Sherrod Patching, VP – Customer Success, GitLab, highlights a typical pitfall: an overemphasis on feature-function discussions.  She says, “… it’s easy to just pivot to feature function. (But) ensure you understand how these features and functions that they’re so excited about are going to lead them to business outcomes and ensure they’re on the right path.” (Snippets from episode #9 of The Shift podcast). Particularly for products with high release cycles, it’s not about turning on features for the sake of it. It’s about highlighting those that bring customers closer to desired outcomes, like faster development times or increased efficiencies.  Other common mistakes to avoid: Overlooking customer segmentation: Different customers have unique needs. 73% of customers expect companies to understand and 62% expect companies to anticipate these needs. Ignoring customer segmentation can hinder the ability to engage effectively and tailor offerings. Neglecting relationship building: Building trust and rapport with customers is essential. It’s not just about the bottom line; it’s about fostering long-term relationships.  These relationships can bring on upselling and cross-selling opportunities. A McKinsey study reported that upselling and cross-selling can increase marketing ROI by nearly 30% and overall sales by approximately 20%. While results could vary by business, sector and service, the bottom line is sales performance can increase even with existing clients.  Ignoring customer feedback: Failing to act on customer feedback means missing opportunities to delight customers by improving current offerings and developing new, relevant ones. Shockingly, just over 20% of B2B companies consistently measure and act on insights from customer experience.  By sidestepping these mistakes, organizations can build lasting relationships, optimize sales growth strategies and drive long-term success.  Emerging Trends in Customer Success Management  Several trends are reshaping how customer success management is viewed. One significant trend is Account-Based Marketing (ABM). This targeted approach allows customer success teams to tailor their efforts and resources towards those customers that are most likely to succeed.  Another emerging trend is the growing emphasis on social selling. By leveraging social media, customer success teams can connect with potential customers, build relationships, and promote their offerings.  There is a noticeable shift towards proactive engagement. Rather than waiting for customers to reach out, customer success managers actively engage them, offering content, support and offers tailored to their needs.  Customer education and empowerment are also gaining traction. Customer success teams are investing heavily in webinars, tutorials and other resources that help customers fully understand the features of offerings. This focus on education allows customers to get the most out of the product or service.  Lastly, customer journey mapping is a crucial tool for customer success teams. By understanding the customer’s entire journey, from the first contract and through the relationship, customer success teams can identify opportunities to improve the customer experience.  “This seamless experience for the customer, that’s shared with the customer, that’s documented in systems, that then carries through, becomes a continuation of a single journey.” (Snippets from episode #9 of The Shift podcast). These trends highlight the increasing complexity of customer success management and the need for innovative strategies to meet customer needs and drive continuous improvements.  Addressing Challenges in Account Planning and Governance Organizations frequently struggle with account planning and governance – a crucial process that requires strategic plans for customer account management. Challenges often arise due to misalignment among teams, lack of customer insights, poor communication, focus on short-term goals and inadequate resources. Masterclass by Forrester Principal Analyst Anthony McPartlin: Why companies fail with key account management? There is a need for a cohesive approach to account planning. Account planning by the Sales team and success planning by the Customer Success team needs to be aligned. Many organizations treat these as separate processes, resulting in siloed approaches. However, ensuring that account plans and success plans operate in tandem is vital. “But those two need to go hand in hand. What you want

Key Account Management: Best Customer Segmentation Strategies for Customer Success Teams

Customer Segmentation for Key Accounts Engaging with customers and striving for positive outcomes in those interactions play a vital role in helping a business succeed. From enterprises to SMBs in the B2B sphere, almost every organization is focusing on keeping up with the needs of their customers. With the widespread permeation of digital media, personalized communications and solutions have become commonplace. These granular, bespoke communications can be effective if they are delivered to the audience they’re intended to. Customer segmentation helps in identifying the shared characteristics so that these group of customers can receive our solutions & attention more effectively. In SaaS companies, customer segmentation for key accounts is usually done based on the Annual Recurring Revenue (ARR) value of the customer organizations. Since ARR segments clients based on the revenue contributed, segmenting becomes easier – but it can be counterproductive when vendors prioritize accounts with high ARRs. The risk-avoidant nature of ARRs means customer success & account management teams have to segment their customers strategically and understand the similarities and differences between the needs of their clients. Learn More: The Role of Key Account Management in Customer Success Management The need for key account segmentation Every customer is different – While some might expect customer success teams to help them understand the issue in detail, others might want minimal communication outside the scheduled interactions. Teams can put these two customers in separate segments, and create an accurate assessment of their needs. This helps teams get a clear understanding of the issues in front of their customers and deploy resources in an effective way. Unlike the old methods where large clients were clubbed together, developments in the area have resulted in methodologies that include companies from various industries, of different sizes and revenue, together. These methods ensure all customers across different segments get the same importance, but with different approaches that are suited to their needs. Read More: What is Customer Centricity and Why it isn’t the destination? Types of Key Account Segmentation There is no dearth of customer success segmentation models, and teams can choose the one that suits their needs most. While traditional methods have lost their allure, certain new frameworks have shown value in customer segmentation. Based on the model that is chosen, teams have to consider the variables specific to the industry or business. The nature of the products and services being proposed also play a part in deciding the segmentation model to be used. Trait-Based Segmentation It relies on demographic information, like the industry, company size, latest developments in the sphere etc. This segmentation technique is easily identifiable, but the underlying assumption that shared traits between industries or companies also share desired outcomes can lead to misleading assumptions. RFM-Based Segmentation It stands for recency, frequency, and monetary aspects of the customer organization. Recency refers to the time elapsed since the last customer interaction, Frequency is about the number of times customers contact the vendor in a specified period of time, and Monetary aspects refer to the total spending of the customer with the vendor. These details help customer success teams to gauge the responsiveness of the customer and plan their proposal accordingly. Value-Based Segmentation Value-Based Segmentation groups customers according to the economic value they provide to the vendor. It focuses on the ARR potential of customer organizations, and groups them by subscription levels, production rates, existing ARRs, and similar metrics. Customer success & Key Account Management teams can locate upsell and cross-sell opportunities with this method, and serve existing customers better. It focuses attention on building relationships with customers, and improves the revenue potential over time. Needs-Based Segmentation It classifies customers based on specific needs. Customer success teams group customers who use products for similar objectives, and achieve targeted service delivery for every one of them. Types of key account segmentation based on revenue The process of segmentation differs from one methodology to another, but the steps involved largely remain the same. Segmentation on the basis of Revenue (MRR or ARR), one of the most prevalent methods, is usually done under the following labels: Revenue Segmentation Revenue Segmentation pays extra attention to customers who contribute more to the bottom line, because high-value customers usually have complex needs. The customer success teams should carefully select meaningful segment boundaries, where customers below and above revenue boundaries have varied needs – otherwise the difference in treatment can be jarring to the customers. Also, the matter of customers who downgrade their subscription or opt for a lower tier contract needs to be handled carefully, as dropping low in the order of importance can cause resentment when not handled diplomatically. Revenue Potential Revenue Potential of a customer might increase multiple times over the future, even if it is relatively low today. Or in case of enterprise clients, the partnership may start with a really small project, but if the team understands the potential of serving other departments/functions and tailor their product accordingly, there could be excellent upsell opportunities. By providing high value of service even at low MRR, the chances of getting bigger projects is increased. Reference Accounts Reference Accounts are customers who may not have a large relationship value, but have great contacts in the business to whom they can refer vendors to. If they are really happy with the limited partnership scope, then too they can serve as reference points for other prospects that customer success teams approach on their own. Lifecycle Stage Lifecycle Stage of customer technology adoption is very important for SaaS sales teams. Customers in the initial stages appreciate vendors taking the time to help them understand the intricacies of the field, and they need more upfront time investment than those who are in advanced stages of technology adoption. Industry Industry level segmentation makes sense if the vendor product is used by multiple industries in different ways (check out systems, for example – which can be used by PoS systems as well as warehouses). Teams can then focus on industry-specific messages while approaching customers.

Customer Success and Key Account Management: 2 Intricate Cogs of the Same Wheel

When Jeff Bezos founded Amazon in 1994, he did so with the mission of becoming “Earth’s Most Customer-Centric Company. ”Fast-forward to 2020 and one can argue that customer success, and rather customer obsession is the sole pillar that Bezos’ entire $1.7 Trillion empire rests upon. But while the vision during the early days was in place, the definition was nowhere in sight. As Bill Price, former Global VP of Customer Service Amazon explains, Bezos interestingly (and maybe even purposely) resisted accurately define his vision for several years. Eventually, things took shape and Bezos took the first major decision that would drive his point home – allowing customers to review the products – a decision that attracted strong initial backlash owing to possible sales detraction. But Bezos was firm in this belief – “We don’t make money when we sell things. We make money when we help customers make purchase decisions. “Over the decades, this vision has transformed into a near maniacal culture of customer success, one in which Bezos leaves a chair empty at conference tables as a reflection that it has been occupied by the customer – “the most important person in the room”. Today’s blog is a journey into customer success, the benefits that it can reap for your organization, and what it looks like in practice! What is Customer Success All About? In essence, customer success is about making your organization’s culture, philosophy, department, or role all about the customer. And especially in a manner that your customers can easily find ‘success’ with your products and services. When customers interact with a brand, they expect a specific desired outcome via an experience that can be tagged as ‘meaningful’. Customer success is about meeting such expectations time and again. As Jeff Gardner puts it – “The fastest you can help customers understand and extract value from your product that is in line with their business goals, the stickier and more successful they’ll be.” Misconceptions About Customer Success Since customer success is a rather newer concept in the management world, a lot of misconceptions exist, especially when managers deploy customer success programs for the first time. Myth 1: Customer Success Always Translates to Hands-on Service Customer success might translate to being obsessed with customers. But this does not necessarily mean that CSMs are engaging with customers round-the-clock. Customers prefer minimal interactions and the fewest possible touchpoints for their queries to be addressed. Hence, customer success, in this case, would mean optimizing such touchpoints for smoother onboarding, documentation, automation, etc. Myth 2: Customer success is a single department drive This cannot be farther from the truth. While it is true that customer success cannot thrive without ownership, it has to be a pan-organization effort. Assigning customer success to specialists is just the tip of the iceberg and would amount to nothing if the rest of the organization does not follow suit and work collaboratively towards a single objective. Myth 3. Customer success translates to feedback collection and analysis Don’t get me wrong. Feedback is one of the most crucial building blocks of customer success. But assuming that customer success is only about customer satisfaction surveys and Net Promoter Scores is highly erroneous. Surveys might be good for specific queries, but they lack in-depth insights about products, customer behaviors, trends, correlations, and more. Why Does Every Business Need Customer Success? “Until you know what it takes to achieve success from your customers’ perspective you will just waste valuable time.” – Jason Whitehead, Tri Tons Your business’s success closely depends on the success of your customers. That is the crux of this blog. There is no point in selling a product or service if your customers are not “winning” (constantly) after making their purchase decisions. Jeff Bezos is a billionaire NOT because he has created an automated sales ecosystem. It’s because he has created thousands of millionaires around the world through Amazon in the form of star sellers. It is also because Amazon helps end customers to make the best purchase decisions for their available budgets. If that’s not convincing enough, here’s why customer success should be at the helm of your business strategy in 2021: Reduces Churn: When you listen to your customers and accordingly iterate your service or product, it’s only natural for their satisfaction graph to rise and for them to stick around longer. At a proactive level, this also translates to solving issues of customers even before they can spot them! Drives Revenue: It should not come as a surprise that the majority of your revenue comes from (or should) post-sales relationship building. That’s simply because it is much easier and economical to up-sell and cross-sell instead of acquiring new ones! Improves the Renewal Process: For businesses functioning on SaaS and subscription models, renewal conversations and decision-making on the part of their customers are fairly common. With customer success, users are more likely to keep renewing and stop questioning their decisions time and again. Customer Success in Key Account Management If customer success is all about aligning the definition of success of clients with your organization, then how does Key Account Management (KAM) come into the picture? In essence, KAM is a subset of Customer Success. Think about it. If 80% of your revenues come from 20% of your clientele, customer success would translate to successful KAM for these accounts simply because they matter the most. To achieve the best results, you must merge the two management styles to ensure the most optimal outcomes for your business. During implementation, this is not a complex feat to achieve since KAM and CS are two sides of the same coin. This also brings us to their key differences: Client Focus: In a typical Customer Success scenario, you would not want any client to be left behind. The idea is to help each one of them succeed to the point of no return. On the other hand, KAM expects you to cherry-pick the clients that add the most to your

How to Optimize Your Business? – Thanks to Sales Enablement Tools

Nowadays, businesses need the right tools and data to remain competitive in their respective market. This makes now the best time that you check out sales enablement software. These are solutions that provide your team with the proper tools, knowledge, processes, and functions to maximize every sales opportunity. Sales enablement is more than just about lead generation. It covers an umbrella of functions such as recruiting, hiring, onboarding, training, coaching, providing resources, and evaluating the effectiveness of certain programs within the organization. Likewise, sales teams are not the only ones who benefit from such sales enablement tools. It can also help marketing teams, human resource teams, and more. It syncs every department within your organization and ensures that their goals are aligned towards one goal, which is an increase in productivity and efficiency of sales. With that said, here’s how you can optimize your business with the right sales enablement tools in the market. 1. Synchronize source of content and data As mentioned earlier, sales teams aren’t the only ones who get to use sales enablement tools. It can affect your whole department as well. It does so by providing a centralized source of content and data for all departments. This source of content and information is critical for engaging with potential customers and closing deals with them. Having a single source of truth for all your content can help you create a more streamlined and organized sales enablement strategy. This helps sales reps and other teams reduce wasted time and efforts on searching for and using relevant content to use for their campaigns and operations. This centralized repository of data can also help you improve your sales account planning, especially if you integrate it with your customer relationship management (CRM) software. DemandFarm is a powerful account planning platform for integrated planning where you can connect your data with external sources for a holistic approach. 2. Personalize buyer’s journey With your customer data organized and aligned properly across departments, this makes it easier for you to personalize your potential buyers’ journey and experience with your company. After all, not all customers need and want the same thing. You would often need to use different tactics to close a deal for each prospective customer. Through sales enablement tools, you can create a relevant and personalized sales account plan for each respective prospect. This serves as a guide that contains all the critical information you will need to interact and close a deal with them. As more customers begin to look for genuine and dynamic interactions, relying on a scripted sequence for each sales pitch won’t be enough. You need to be in tune with your targets’ behaviors, needs, and wants instead of forcing them to fit into your own sales process. And since sales enablement aligns your sales team across all departments, they can get the needed data to learn more about their leads. 3. Streamline communication between marketing and sales team Marketing and sales team may have different functions and tasks within an organization, but they are inevitably tied with one another. A study by LinkedIn shows that 58% of aligned sales and marketing teams have higher lead conversion rates compared to those companies with teams that have poor communication. Sales enablement software can help you with that. It does so by streamlining content for both sides. What one produces, the other can use for its operations. These may be in the form of content, data, and reports. Likewise, it provides transparency on both sides to keep goals aligned throughout. Nowadays, this alignment between the two teams is becoming increasingly important for your business’ growth. With digital marketing blurring the line separating the two departments, these two teams must collaborate to ensure meaningful engagement with potential buyers. 4. Leverage data and analytics Nowadays, data and analytics have become an integral part of running a business. It helps generate relevant content for their brands, make smart decisions, develop better strategies, and create meaningful relationships with their customers. According to a report by the Havas Group, 81% of brands often go extinct because they no longer create relevant content for their customers. Meanwhile, only 19% collect and utilize data for marketing and sales purposes. This goes to show how much data can affect your business’ growth. One of the benefits of sales enablement is its ability to track and measure the performance of your sales process. You can gain insights from your interactions with your prospects and those who are engaging with your marketing content. This includes top-performing content, trends and prospect behaviors, and areas of improvement. You can use these insights to develop content and process to close deals faster and more frequently. 5. Improve customer engagement The different types of sales enablement tools are geared towards one thing, and that is to drive up your sales productivity and revenues. It would also help in sales acceleration and sales transformation. With the right data and relevant content, you can improve interactions with target consumers and create meaningful relationships with them in the long run. Engagement is essential when it comes to closing deals. The constant streams of communication ensure that your leads are nurtured, and your potential buyers remain interested in your company. Without that point of contact, all your marketing and sales teams’ hard work can fall apart along the way. Sales enablement gives you the necessary tools and data to keep engagement with your prospects and consumers relevant and effective. This includes videos, CRM, whitepapers, datasheets, and more. 6. Integrate with your other solutions The beauty of technology is that you now have other tools, devices, and solutions within reach to help you manage and operate other aspects of your business. Sales enablement applications are just one of the software you can integrate within your system. Having one software may sometimes not be enough. After all, no solution is one-size-fits-all. Sales enablement software has its limitations. Nonetheless, you can incorporate sales management software into your strategy to further enhance your