An Intro to Customer Success
Article Table of Contents
Customer Success - what is it? #
When I tell people I work in “Customer Success”, they immediately think I do either Customer Support, or sales. In a way, they are correct. I do both. Today, and more in the future, I’ll dig deep into this particular industry.
A traditional marketing funnel narrows as it draws people from the top “creating awareness” pool, down through prospects > leads > trials > and eventually (hopefully!) customers.
Notice that the funnel gets smaller with each step, and ends when the customer pays you. Source: beintheknow.co
There’s different kinds of funnels, or different labels for each stage, but the goal is to identify and speak to a target audience, convince them you can do something valuable for them, and then have them become a customer. (I.E. pay you money)
A “customer” can be a one-time purchase, recurring purchase, subscription, etc. Anything where they pay you money. Litmus is a business-to-business software-as-a-service company. All of our customers are subscribers. We don’t have any one-off purchase options.
There’s very few barriers to becoming a customer of Litmus. No disks to have delivered in the mail, no software to install, no hardware to buy and techs to pay to install it, no contracts, no sales team, and quite inexpensive prices. A few visits to Chipotle/month is the same cost as a basic Litmus account.
Low friction is good! This means we can have many, many customers and don’t have to spend lots of time and effort getting each customer. This is good for them, too, as they can kick the tires of Litmus via a trial, and don’t have to talk to a sales rep or anything else.
This ease of becoming a customer has an edge, though. It means it’s just as easy to stop being a customer. Click a few buttons (A max of three mouse clicks from any page in your Litmus account) and your account will be closed, and you’ll never be billed again.
In the marketing funnel, your goal is to increase conversions through each stage of the funnel, ultimately boosting your numbers of new customers. A Customer Success team looks at a different kind of funnel.*
Difference between customer success and marketing #
If you invert the marketing funnel, and start with your customers (and ignore everyone who is not yet a customer) you’ll have what you HOPE is a path of growth for your customers.
Here’s a quick example. I’ve inverted a traditional marketing funnel, and now the TOP of the funnel is when someone becomes a customer. (Ideally, funnel width is proportional to growing revenue from your customers)
What some Customer Success teams think about. (Thanks to Moz for the original graphic.)
To a SaaS company, marketing is only half the battle. Once you get customers in, you need to keep them.
With low costs to start using a tool, there are low costs to leaving it. There are no multi-year contracts you need to sign, no six-figure hardware installs and ongoing maintenance agreements. You just click the “cancel” button in your account, and you’re done.
So, a customer success team deals with the time in a customer’s life between when they become a customer, and when they stop being a customer.*
From the customer’s perspective, this is the most important time. Indeed, this is the only time that matters. This is certainly the only time the customer is thinking about you. Many companies, however, they’re not quite sure how to focus on their existing customers.
If you want a hint - go talk to your customer support team. They’ll have more than enough feedback to get you moving in the right direction.
I’ll dig more into this soon.
* “Customer Success” can be defined in many ways. Some companies label their outbound sales team “customer success”. Sometimes a strict support team goes by that title. Rather than calling out these companies for appropriating the wrong title - I’d say it’s aspirational and encouraging. If a company is reorienting itself around MY success, as a customer, I’m quite pleased.
Furthermore, there are many different angles by which you could get at “customer success”. If you’re a software company, everyone who works on the core product is technically serving the customer. If you’re in the X team, you’re serving the customer, so aren’t we all in the “customer success” business?
Yes, but for the sake of roles, lets keep it simple and assume divisions. Phew.
Additional Reading: #
- Sixteen Ventures - Lincoln Murphy is THE go-to expert on this.
- Customer Success: How Innovative Companies Are Reducing Churn and Growing Recurring Revenue (By Lincoln and others)
- More that I’ve written on Customer Success