In this episode, Guy Nirpaz (co-founder of Totango and author of the new book Farm Don’t Hunt: The Definitive Guide to Customer Success) and I discuss how to proactively retain customers in a subscriber or pay-as-you-go based market.
The economy is changing towards subscription based models for software and services, focusing resources on the success of retaining customers. There has been a tremendous shift in the business model where companies are now selling their services as subscription or pay-as-you-go services.
The role of the customer success strategy of a company is to proactively impact the client’s lifetime value. Businesses need to be aware of when or if a customer is going to churn. Churn is when the contractual customer or subscriber leaves the supplier during a given period. This could be due to a customer being dissatisfied, rates being better elsewhere, better approaches by other companies, or just having to do with a customer’s life cycle.
There is more money to be made with an existing customer in a subscription based business. Companies need to pay attention to what their current customers’ behaviors are. The key lesson they need to realize is the importance of value. Businesses need to pay attention and make sure they are creating value to motivate their customers to keep their services. There is a decision a customer makes every time they are up for renewal. However, you have to be proactive because the subscriber doesn’t make the decision right before renewal, they have already made that decision long before.
Companies are leaning more towards a data driven approach in retaining their customers’ success. The goal of the Customer Success Team should be generating revenue from existing clients. This allows the organization to take the right actions and determine their priorities. You can categorize this in 4 steps: Onboarding, Nurturing, Renewal, and Upsell. Customer Success Teams are misunderstood within a business. CEOs and Executives don’t know how to distinguish support, service, account management, and customer success.
To get ahead of the issues, companies need to look at it from the mindset of outcomes and drivers. The outcomes are retaining the customer, upselling them, or churn. The drivers are the things you do in onboarding and nurturing to ensure those customers have value. The outcomes and drivers will determine whether an organization is going to move quickly on the path to customer success.
Tune into the podcast for more great information about Totango and how to create customer success!
What’s your most powerful sales asset?
Guy is an authentic person who is passionate about customer success.
What’s the one book that every salesperson should read?
Inside Out and Outside In: Psychodynamic Clinical Theory and Psychopathology in Contemporary Multicultural Contexts by Joan Berzoff, Laura Melano Flanagan, and Patricia Hertz
What’s your favorite music to get you pumped up?
70’s and 80’s Rock
What’s the first sales activity you do every day?