customer success strategy for an economic downturn

Ari Hoffman’s Customer Success Strategy for an economic downturn

Not a single person in 2015 answered “Where do you see yourself in 5 years” correctly. But neither did several companies who had made detailed plans to achieve glorious heights in 2020. 

Covid 19 has thrown every company offtrack which have left teams around the world bewildered. As we slowly accept social distancing as the new reality and learn to live with Covid 19 we have to make sure that not only our companies survive this crisis but are also able to thrive during it.

As we all know, Customer Success will play a crucial role in driving the SaaS industry forward during these tough times. So, to help Customer Success rise up to the occasion, we recently conducted 4 webinars where we invited various industry leaders and discussed how Customer Success will play a massive role for companies to thrive during this pandemic.

For the first webinar we had Ari Hoffman, Director of Customer Advocacy, Coveo discuss Customer Success Strategy for an economic downturn with Puneet Kataria, Founder & CEO of CustomerSuccessBox.

instead of focusing only on KPIs and metrics it’s important to make the customer successful

Churn Analysis Template

What should be the Customer Success Strategy during these tough times? Where should people start from?

According to Ari, the rate of innovation is extremely high during crises as it is a do or die moment. However, to use a crisis as an opportunity to grow, it has to start at a personal level and then expand throughout the team.

Customer Success has never been as critical as it is now but instead of focusing only on KPIs and metrics it’s important to make the customer successful. Right now the aim should be to make our customers’ lives easier by using our product or service by focusing on customer outcomes. This will make the customer successful and hopefully make them stay with us during these tough times.

Puneet added that in the subscription economy the company is not only dependent on new sales but MRR is equally important, if not more. If Customer Success helps their customers stay and grow in business, they would continue to be our customers which will keep the economic flywheel running.

Ari gave several examples on how customer success departments can actually help their customers by thinking out of the box. For example, the support department currently is under a lot of pressure. As their customers are also working with minimum resources while wanting to get maximum results. Here the success department can unify the various information by going through the support documents and creating rapid response resources and dashboards for the customers. These dashboards will be self-serve and can be tinkered with to solve future problems also.

How can SaaS businesses get such out of the box ideas?

As these are unusual times, we need to reset our previous plans and start from scratch.

Puneet sharing from his experience said that, at CustomerSuccessBox, we are focusing on Business Scenario Modelling, which is done by companies for themselves, for their customers.

keep the door to customer communication open

First, separate your customers into different segments based on how much the pandemic has impacted them. The different categories can be:

  • Zero Impact
  • Severe Impact
  • Average Impact
  • Minimal Impact
  • No Impact

Then try to step into the customer’s shoes and empathize with them. Start brainstorming and collaborating with your customers and hopefully you will be able to come up with new customer success strategies.

Ari added that waiting to deploy strategies till everything is figured out is good for big companies in normal times. But for rapid response, you need to be agile and flexible. Not everything will work as per plan and that is fine, just build the next MVP and keep trying.

The other important thing is to keep the door to customer communication open. Sometimes customers are scared to have unfiltered conversations but in these tough times it is the opposite. Customers need help and want to talk to someone who understands their problems.

For the sake of open communication, don’t try to divert their attention from their busy schedules. Lead with empathy and suggest them things that will give them real time results.

In the SaaS industry, we already have access to huge data, Use the data to figure the customer’s pain points and help them set their objectives while combining it with their subjective response to form a bigger fool proof strategy.

Several questions were asked by our viewers among which the most common ones we have answered below:
Customer Onboarding Template

How to improve 2 way connections and build relationships?

Ari suggested that there are 3 main ways to communicate with customers (in order of high to low importance).

  1. Video Conferencing: There are many free video calling softwares where we can even discuss reports in real time which, along with being productive, build a better relationship.
  2. Calling
  3. Sending Emails: Instead of sending mass emails, send personalised emails.

Puneet added that instead of speaking with each customer separately, first segment the various customers on specific metrics into different buckets. Then from each bucket, talk to 5-10 customers so that you get an idea of what problems the customers in each bucket are facing. Another advantage of this approach is that you talk to few customers but you have longer discussions with each customer and hence are able to learn about them on a deeper level. This will help you build better features and dashboards that can actually drive positive results for your customers.

Ari also suggested that as CS teams work with product teams, they need to decide which features can be made in the least time and have the maximum impact. To help in this decision the CSMs can collaborate with their customers.

Puneet agreed and said that in these times people are willing to engage more than ever and want to learn from each other. Tough times come and go but good relationships last forever.

How to maintain MRR?

During tough times everyone has shortage of funds and asks for discounts. But as a business we cannot give free services everytime as that would. 

According to Puneet MRR is a function of the success that we deliver. The first question to ask is are we relevant? If not, the first task is to make ourselves relevant.

Like gyms took their classes online, restaurants have converted themselves into cloud kitchens and have started online delivery, the business model needs to be tweaked so that customers continue to derive value from the product/service.

Companies have to act responsibly along with being empathetic and being transparent. The priority is to survive first. The companies can themselves ask for rate reduction and discounts from their vendors and pass on some of the benefits to their key customers and those who need it the most. 

While doing all this, the business should also be made more efficient.

After brainstorming and business scenario modelling, the product map needs to be revisited as the pandemic has brought about permanent customer behaviour changes. 

It is an opportunity to build a strong recession proof business

Ari added that it is time to take a pause and look at the product roadmap from different perspectives before making the required changes. It is also a good time for employees to try their ideas and share their results or learnings with the company to construct an effective product roadmap.

It is an opportunity to build a strong recession proof business and if we are able to do it, in future we will be on a path of explosive growth.

How do CSMs meet their upsell and renewal quota? If companies start offering free licenses, how will CSM incentives be affected?

According to Ari, the questions depend on several factors like the vertical the business is in, business model, go to market strategy etc. But in general, if the company is doing good, CSMs should get the incentives, If not then CSMs should share ideas to improve the company’s condition.

It is critical to decide whether the company should focus on MRR, logos or something else according to Puneet. If your customer is reducing jobs, they may need less number of licenses. We have to decide whether we want to retain the account or focus on MRR. In the subscription economy, lifetime value is more important than MRR and ARR. Retaining the customer is more important than hitting the renewal quota but it depends on the business to business.

Ari added that it is an opportunity to challenge our customers to make them successful while being transparent, empathetic and authentic.

We have to go through this tough time together and keep trying to improve as when the boom comes, all of us are ready for that massive growth we have been waiting for.

Customer Success Strategy Webinar with Ari Hoffman

Thanks for reading this recap. As a reward, here’s the full webinar for your reference.

Arnab is a content marketer at CustomerSuccessBox. In his free time he loves watching videos on YouTube and reading about entrepreneurship and startups.