Customer success teams play a critical role in helping people use products effectively and recognise their value. Yet there’s a whole load of myths and surprisingly little insight about what makes an awesome customer success rep.
The customer success team has long been a mainstay of the SaaS industry, but in recent years other businesses have woken up to the importance of customer success functions.
It’s not surprising, given the incredible potential of the role. In a Deloitte survey, more than half of respondents gained 10% higher up-sell and cross-sell revenue, and higher renewal rates with a customer success team.
In this article, I look at what makes customer success teams so vital for companies right now and the five customer success myths to watch out for.
Why everyone’s talking about customer success
Today’s customers expect to be able to measure the impact of a product and justify the return on investment.
There’s a popular saying that goes, “if you can’t measure it, you can’t manage it”. Essentially, if customers don’t have the numbers to validate the success of a product, it’s going to be on the firing line.
So, if you’ve got a subscription model, then your focus isn’t just going to be on new business. It’s going to be on growing existing accounts and making sure customers have that crucial measurement – which is why customer success teams are important.
Growing client accounts has become a priority for many companies since the pandemic started. We know that winning new business is five times more expensive than retaining existing customers. So it’s not surprising that strategies have moved towards more sustainable growth and safer futures.
The reasons customers leave your company
Now that people are looking more closely at retention, the question they’re starting to ask is: why would someone leave our business?
The first reason is that your product isn’t working effectively and delivering a good ROI. I always say that 20% of ROI is achieved by the product itself and 80% is achieved by what customers do with it.
Leaving customers to figure out how to use your product to its full potential is one of the riskiest things you can do – which, as we know, is why customer success reps are so important.
The second reason customers leave is that your customer success team hasn’t been proactive about spotting opportunities.
Your customers’ goals are constantly changing, as is the way they’re measured. Customer success reps need to know what customers’ future goals and desired outcomes are, not just what they needed to achieve when they first committed to your solution.
This is absolutely crucial, but you’d be amazed how many people miss it altogether.
I’ll explain more about why this matters below, as well as the five most common customer success myths.
The five myths of customer success teams
Myth one: If you over deliver on expectations, you’ll be able to grow an account
We’ve talked about why customer success teams are important and how they can make it easy for the customer to buy more. However, the way most reps go about this is to over deliver and hope that’s enough of an incentive.
The problem is, studies have found zero correlation between over delivery and customers buying more. After all, why would you buy more when what you’ve already got is working just fine?
Over delivering also sets a difficult precedent. It gives customers unrealistic expectations and you’ll be left spending time and resources on accounts that aren’t growing.
Myth two: Solve customer problems and they’ll be happy
The Effortless Experience talks about how customer experiences are more likely to drive negative word of mouth than positive word of mouth.
It isn’t enough to solve a problem and hope for the best. Here’s why – you’re asking your customer to call up every time they run into an issue, which requires a lot of effort on their part.
Instead, customer success teams should focus on next issue avoidance to mitigate problems before they happen.
What are the main reasons a customer calls up? Then what are the four or five issues that tend to happen after that?
By understanding their issues, you can help customers avoid problems before they even experience them. Simply tell them, “There are a couple of issues that have come up for other customers – if this happens, do that, if this happens, do that”.
Then send a quick email follow-up to make sure your customer knows exactly what to do to prevent those issues from happening in the first place.
Myth three: They’ve bought the product so they must know its value
Customers need to know why your product is working for them, not just that it’s working.
A lot of customer success people forget that competitors are always snapping at the heels of clients. By getting the client talking about what they were originally looking to achieve by working with you and looking at the results and wider impact they’ve seen, you’ll have a chance of holding your place against the competition.
Myth four: This year’s objectives are the same as last year’s objectives
Your customer has had a successful year and your product has worked well for them. Naturally, companies try to renew the same package – and here’s where it goes wrong.
Customer success reps need to recognise that any half-decent salesperson will phone customers to ask what they want to achieve next year.
If you’re not having that conversation about your customers’ future, then they’re going to talk to new people. And those people are going to seem like they’re the only ones who care.
Customers’ objectives are always changing, so make sure you’re positioning yourself as a great option for whatever they’ve got planned next. Where do they need to be over the next three years? What are the outcomes?
Myth five: Customer growth only comes from upselling
The last myth is that growth only comes from upselling your customers.
Most people try to get customers to buy more products, but it helps to think of medium and large businesses as marketplaces. They have different regions and divisions; you’ll have started working with one but there are zero reasons why you shouldn’t explore others.
Customer success reps can look at these divisions and map out a company’s “white space” to find other spend you could be receiving. Once you’ve identified an opportunity, it should be easy to get your foot in the door:
- The customer you work with can put you directly in touch with the decision maker in that department
- An internal recommendation is incredibly powerful
- It’s easier for big companies to work with someone who’s already on its preferred supplier list
Looking for internal referrals from happy customers is a no-brainer, yet so few people do it. Up to 91% of customers are happy to give a referral and salespeople who actively seek out referrals earn four times the commission of those who don’t.
The next steps for your customer success team
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