One of the most well-represented sectors in the SaaS/Cloud lineup is the general group of technologies to automate and assist companies with everything up to the execution of a sales contract with a customer. The category takes in a range of functions and often goes by a variety of labels: Customer Relationship Management (CRM), Business Intelligence, List Management, Business Analytics, Marketing Automation, Sales Force Automation (SFA) etc. There are lots of on-demand tools for “Hunters.” But what about systems for effectively managing the ongoing customer relationship? Where are the products and technologies for the “Farmers?”
While there are a few vendors beginning to advertise Customer Retention Software, most of the offerings appear to be still primarily focused on marketing and sales to new customers. However, as the pressure fromWall Street increases on SaaS/Cloud firms to improve their profitability and valuation by increasing customer retention and the predictability of their recurring revenue streams, and as Customer Success Management teams proliferate, the market for tools is set to expand. Here is a beginning list of what will be needed in a basic customer retention manager’s technology suite:
Customer Engagement / Application Adoption Monitoring
In the research of The HotLine Magazine over the past several years, the lack of customer adoption of a application’s feature set has been consistently reported as one of the primary indicators of churn. Awareness of that factor is rapidly growing, and Customer Success Managers have accordingly started to track feature usage as closely as they can. For companies whose applications weren’t designed themselves to track actual usage of specific features and functions by customers, there are currently five vendors who can provide that capability, and more are on the way. Application feature usage tracking is an absolute must-have for a CSM team.
Customer Health Dashboards / Operational Status Monitoring
Apart from tracking usage of key features and functions, there is much more that needs to be known about your customer relationships in order to maximize retention. Simple Green-Yellow-Red indicators on a display, especially where there is no understanding of the definition of these status levels, are often worse than useless. As the initial Implementation and Training phases are rolling out, the CSM team needs access to the project management system reporting in order to keep an eye on the customer’s progress and to compare it to the ideal for that value tier and/or type of customer. (If the implementation is not being done by a professional team, yours or someone else’s, that’s a significant warning sign in and of itself.) Add the Case Management System of the Customer Support team to the toolbox as well, and be sure that the support reps can set status alerts visible to the CSM team if problems are not able to be speedily resolved. If more than one customer is affected by a bug, all should be automatically included in the tracking.
Operational status monitoring can provide a wealth of data, but that data still needs to be turned into actionable knowledge about your customers. During the sales cycle, the sales team developed a lot of information about the prospect that now needs to be maintained and extended. While there may be many individuals in your customers’ organization that interact with the application and with the members of your organization, there are also decision-makers and influencers that may not themselves have such direct interaction on a regular basis. Another prime cause of churn reported by participants in our research is divorce, a separation between your company and the senior management and other decision makers of the customer.
Has a major influencer or decision-maker left your customer’s organization? If so, that’s cause for two separate lines of action. First and foremost, you’ll need to cultivate someone else to cover that role for you, to encourage the continuation of the relationship from the customers’ side. Second, you need to find out where that former friend/influencer has gone and explore the potential of their new position and company. What new business initiatives have been planned or introduced by your customer that could affect either the current contract or potentially involve extensions? The need for up-to-date knowledge about your customer never goes away.
Social Media Scanners
Just as you monitor social media sites and channels to keep up with what’s being said about your company and products, you should also be keeping informed about what is being said about your customers and the key members of their organizations. Are rumors circulating about possible mergers and acquisitions? You may find that the first information you receive about the departure an influencer or key manager at a customer site may come from a status change on a social media site.
Putting It All Together
There is one other key aspect of a good customer retention technology suite that cannot be over-emphasized; it’s the most important of all. The best tools are valueless without someone to make effective use of them. The greatest single churn factor is the lack of an authentically chartered and accountable owner of the ongoing customer relationship. Who is that in your company?