Proven SaaS Customer Success Best Practices to Increase Lifetime Value
Recurring revenue is the lifeblood of any SaaS enterprise operating within today’s new subscription economy. The digital transformation of business has led to an explosion of demand for SaaS products, but the low barrier to entry and the fluidity it has afforded customers has created immense competitive pressures.
While there’s a temptation to prioritize the acquisition of new customers—a market share focused approach—the real prize lies in nurturing your current customers. After all, recurring revenue is ultimately more valuable than new revenue.
With this focus on recurring revenue, your goal becomes increasing the lifetime value of your customer relations. It requires you to use SaaS customer success best practices centered around mutual growth, a deep understanding of customer behavior, and constant monitoring of your customer’s journey.
SaaS Customer Success Best Practices That Work
The software subscription market, combined with innovations and disruptions in service models, has created a customer-centered economy. Now, your customers expect services that suit their every need, and they tend to view the subscription market as a short-term investment they can move through without repercussion.
To thrive in this environment, you need customer success practices that will produce lifetime value, including:
- Comprehensive monitoring of customer behavior
- Shared customer information
- Rapid response to customer behavior
- Personalized programs and engagement
- Optimized customer onboarding
Remember, you’re trying to grow relationships with your customers to maximize their lifetime value. It’s about detail and dedication.
Comprehensive Monitoring of Customer Behavior
In a digital world where the customer is in the driver’s seat, you need to know as much about them and their habits as you can in order to remain relevant. This requires more than your traditional CRM can deliver. You need a comprehensive vision of how you are performing relative to your customer’s expectations at every stage of their journey.
You want to leverage software that allows you to visualize your customer relationship hierarchies across varied segments, accounts, and product lines. That way, you can escape the dreaded one-size-fits-all mentality and build a real understanding of your customers by analyzing their responses and engagements, their usage uptake and feature preferences, and their suitability for expansion.
Shared Customer Information
Every point of contact your business has with your customer generates data and offers insight into their experience. As such, customer success in the SaaS market is not the domain of a single team—it’s a company-wide strategy.
Making your customer data available to every member of your team and empowering them to add to your customer knowledge base is the best way to ensure your customer has a positive experience at every stage of their journey.
Rapid Response to Customer Behavior
It’s not enough merely to gather and monitor all this wonderful customer information; you also need to take proactive action with it.
Here’s an example. Suppose you identify that a user is regularly accessing several of your core product features but has yet to engage with a fourth. You know this feature has helped other customers save time, so you should be able to clearly demonstrate its value. You send out a personalized email or social media message letting the customer know you’ve noticed their work practices and that you have a new feature to show them that’s going to increase their ROI within your service.
Essentially, you’re growth hacking: identifying a need and providing a solution at the same time as you increase the personal depth of your customer partnership.
Personalized Programs and Engagement
These personalized programs and engagements can reduce your customer churn rate. The customer-centered economy means the customer is justified in thinking they should be the core of your entire company’s universe. You can demonstrate you actually live that reality by producing communications that speak directly to their current real-world behaviors and challenges.
This approach reaps its rewards long before you enter the final stages of the renewal process. Rather than addressing your customer for the first time with a blanket appeal for their loyalty, you instead develop a journey-long dialogue that positions you as an irreplaceable partner.
Optimized Customer Onboarding
You begin that dialogue with your customers from the first engagement, but you give your promises foundation when they start using your products and services. You can consider your customer to be in the onboarding phase right up until the day they can master the entire suite by themselves.
With your onboarding process, you’re establishing a customer’s emotional connection to your product. You want them to feel impressed and comfortable so they can get value from your partnership right away.
You want to create what we’ve termed a SASSE framework built around five key steps:
- Sales handoff
- Achieve first value
- Success plan
- End of onboarding
This method ensures the smoothest transition through each stage of the onboarding process so you don’t lose customer knowledge or alienate them.
All the practices we’ve laid out are part of an ongoing goal to prolong and deepen your customer’s connection to you. That, in turn, helps you increase your customer lifetime value. The key target in any long-term partnership is growth and expansion. You have to demonstrate to your customer that you’re not a part of the disposable subscription culture but rather a key element of their future.
You do that by proactively encouraging them to take up or increase their usage of your product. Also, you should demonstrate your scalability at every opportunity and keep them informed of any and all relevant updates.
Putting Best SaaS Customer Success Practices to Work
Survival as a SaaS company in the subscription economy depends on generating recurring revenue that stems from increasing your customer lifetime value. You get there with constant and in-depth customer monitoring and data sharing across your business, which enables you to better respond to your customer’s behaviors. From there, you can personalize your customer engagements toward prolonging your partnership and expanding together as their goals evolve.
This approach requires dedication and an almost obsessive interest in understanding and serving your customers. That’s what it takes to generate ongoing partnerships in this volatile new economy.
Totango is a leader in understanding and innovating within this new customer-centered economy. Our tools and advice can help you quickly onboard, effectively monitor, and continually serve your customers. Request a demo today or explore Spark to learn how we can help you build your business around your customer.
Image courtesy of fizkes.