The magic of cross-functional communication, sales mistakes that lead to churn, achieving CS transformation
Cross-functional communication is one of the keys to effective Customer Success. This single factor transcends industry, business model and your company’s use of technology. At a fundamental level, cross-functional communication is the same as empathy – the ability to understand and share the feelings of another. Within Customer Success, your ability to be empathetic is tied to your understanding of 1) the customer’s goals for your product or service and 2) the customer’s long-term goals.
If we want to help our customers grow, if we want to make it impossible for them to churn, we need to ask them difficult questions and develop the heart to understand their responses. This gets right to the core of effective cross-functional communication.
- Your customer calls your help desk twice a week – every week – with new suggestions for product features: This is a sign you need to get to know your Product Managers and try to understand why your product contains certain features and not others.
- Your customer’s company is growing quickly; they’re adding 10 new licenses every month. They love your product and they want to renegotiate their subscription fee: You need to learn the language of finance and know it well enough to discuss this opportunity with the head of your finance team… and their counterpart at your customer’s company.
Remember, as a Customer Success Manager, you are the bridge builder. You have an incredible opportunity to make sure everything fits together in exactly the right way, every time. The magic of cross-functional communication comes when you can translate the needs of one group (your customers) into the appropriate response of another (a specific team within your organization).
Sales mistakes that lead to high churn
Sales teams often aggressively close deals because of a myopic focus on immediate growth. But what they fail to recognize is that there are long-term implications to short-term focused selling for the business – specifically it can result in a trailing high churn rate. According to Steli Etfi, CEO of Close.io (who knows a thing or two about closing deals!), there are four common sales mistakes that lead to high churn – but the good news is that they are all solvable.
Here are the two that were most interesting to us but we definitely recommend checking out the full read to learn more about how to fix these common scenarios.
- Selling to customers that shouldn’t buy your product: You need to be disciplined to close only truly qualified prospects because in SaaS, selling to the wrong customers will actually kill your business.
- The Consequences: Bad customer feedback that can result in poor product roadmap decisions, lots of bad customer support issues, poor team morale as a result of disappointed customers, negative reviews from unhappy customers.
- The Fix: Don’t just focus on closing more deals, focus on closing better deals. Clearly define criteria that are required to qualify as a good customer, to make sure that everyone who buys your product will get value out of it and succeed with it.
- Over-promising: It’s tempting to sell an improved future-version of your product today and hope that the customer will stick around long enough to actually experience it.
- The Consequences: Hurting your credibility, damaging your relationship with customers, good customers will cancel because they can’t trust you.
- The Fix: Let your prospect know the timeline of future improvements – and always err on the side of caution.
Achieving your Customer Success transformation
According to recent research, many companies are not yet ready for customer engagement transformation. For too many, there are gaps in their approach to customer success that have been keeping them (even those with established customer success teams) from being truly transformational in how they engage their customers.
The good news is, for every gap, there’s also a fix.
Here are three common gaps and strategies to get your program back on track. Check out the full read for more details about how to address these gaps.
- Being too narrowly focused on customer success. Customer success teams are often too narrowly focused. Many companies are managing some post-sale activities but not the complete revenue lifecycle.
- The Fix: Take a holistic approach to the whole revenue lifecycle. Effective Customer Success has to go beyond onboarding.
- Executive support is growing but it’s still not enough. Customer Success teams are often built from the ground up and with limited budgets and little feedback from the C-level on expectations or measurement of success.
- The Fix: Assemble a customer success leadership team that doesn’t require extensive guidance. If possible, before creating your team, ensure you have a leadership team that has successfully navigated the muddy waters of recurring revenue management.
- Lacking data. Effective Customer Success is heavily reliant on having the right people, the right processes, the right technology and the right insights from the right data. You need to have access to the right data and processes to maintain that data in order to be success – but this is often easier said than done.
- The Fix: Ensure your technology is tied to the right analytics — or find a partner who can.
Word to the Wise
This week’s wisdom gives us three Aha! Moments about Customer Success from a recent industry conference:
- Customer Success is always changing. This is simply because the needs of customers, teams and people are always changing; the idea of Customer Success is very fluid and there is no magic bullet.
- Content is still king, not just in marketing. Customer Success should be driven by your content. Remember that customers typically will not go to a your website to find help; instead, they turn to a search engine. So you always need to make sure you are optimizing your content when writing; it also needs to be a positive user experience.
- You have to cultivate. This philosophy generally favors the customer over the seller and it should run throughout your organization in which you work. Customer Success is a mindset, not just a team within a company; all teams in your company need to be not just internally optimized, but customer optimized as well.