SaaS/Cloud company management teams have always recognized the economic necessity of spending a certain amount of money to acquire a customer. Customer Acquisition Cost (CAC) is a standard part of the business plan. What is not so readily acknowledged is that spending money to retain customers is also a necessary aspect of the new business model. It’s unfortunately very common…
The SaaS & Support Project research into the common causes of lost customer relationships showed that the most commonly identified “departure driver” was Divorce. Either the management of the customer company had changed, resulting in the loss of the internal champion, or the relationship had become distant. One SaaS company CEO described this scenario as a loss of contact "at the top' of the food chain, with upper management either leaving or forgetting why the system was implemented. Three significant questions come immediately to mind: 1) Why are SaaS vendors being taken by surprise? 2) What can be done to save the relationships? 3) How can CEOs stop setting their companies up for churn?
What's the difference between a short-term policy and a long-term strategy? All too often, it's the difference between some limited revenues and sustainable profitability. Folklore has a very apt phrase for it: “Penny-wise, pound foolish.” In more corporate terminology, “The exclusive focus on immediate gains may put long range profits at risk.” In an era where companies constantly talk of the need for 360-degree views of the customer, Customer Relationship Management and of the importance of customer retention, why is it so easy to find myriads of examples wherein valuable customer relationships are mismanaged and lost?
A new name, a new look, and a new focus has come to The HotLine. Re-launched as The HotLine Magazine, the new layout and graphics have strongly increased the accessibility of the articles and content. But the crucial difference is more fundamental. The focus has changed from optimizing center operations over to producing strategically significant, and sustainable, levels of contributions to overall corporate profitability. And the same needs to happen to the old role of Support / Service and the customer contact center. It's indeed time for something new.