Customer Success Playbook for an economic crisis

Now that we are in an economic crisis due to the pandemic, we might as well equip ourselves to deal with it and hopefully come out better instead of waiting for the situation to heal by itself, which might take quite a while. So, we invited James Scott, VP of Customer Success, ShootProof to discuss how we can build a Customer Success Playbook for an economic crisis, which KPIs should be measured, best way to communicate with customers for renewals, etc.

Learn more about the customer success playbook for an economic crisis. Here’s a summary of that conversation.
Cheat Sheet for Customer Success Template

What should be the KPIs of success teams in these times?

According to James, this is the first time Customer Success (CS) has come into the spotlight and hence it a perfect opportunity for the CS community to shine and make an impact.

Due to the pandemic, smart companies are focussing on customer retention and revenue retention as customer acquisition is hard now.

To make a positive impact, it is crucial for the Customer Success team to stay true to its core and understand customers which will help them to deliver value to the customers. Measuring KPIs are also important so that the results can be shown back to their organisation and also to the customers.

CS teams should maintain consistency with the metrics (like retention, upsell, NPS) but the targets should be discussed to make them achievable in these times.

Puneet suggested that no CS team runs on a single KPI but rather a set of KPIs like logo retention, MRR Retention, Upsell etc.

But the metric that is prioritized the most shows the focus of the organization and what different teams in the company should prioritize.

As now the logo retention should be prioritized, most of the efforts should go into preserving the relationship with the customer as revenues can be increased later.

James agreed and said that even acquiring the same customers is difficult. He gave the example of ShootProof where they have a free plan and they help customers to move to this plan in case they are facing financial difficulties. It allows the customers to keep using the product instead of closing the account.

Puneet asked whether you moved the customers from a paid plan to a free plan or you allowed the customers to use the existing plans without a fee, temporarily?

James replied that the free plan was always there and always is an option. But, instead of pushing free stuff to all customers, we wait for customers to come to us and then we discuss and understand their problems and then offer custom solutions. Customers always don’t need free stuff and sometimes customers need other things (like extra licenses, seats, API usage, credits etc) which we try to provide and in turn learn a lot from the customers.

Puneet suggested that a customer success playbook shouldn’t be built in a silo but in collaboration with customers. If you have a large number of customers, discuss with a sample size so that you build something that is actually useful.

James pointed out that humanizing the relationship with customers shouldn’t be skipped. Customers shouldn’t be treated as numbers on spreadsheets and this is the best opportunity to build personal connection. Do small things which can make a big impact on the customer which will always be remembered and appreciated.
Customer Onboarding Template

What should be the targets during this time? Or should there even be targets?

James firmly believes that there should be targets so that we can articulate, track and measure impact but targets need to be adjusted, adapted and changed in these times. Not always we will get it right as this is a new situation but we will learn together.

The targets should be based on the historical data and experience, conversations with customers so that the targets are realistic.

Using the assumptions and limited data, make the targets and then after a month relook at the assumptions and reset the targets if needed, as now more data would be available.

Puneet agreed and said that the gold standard is maintaining the same ARR this year though that depends on industries you are serving. In most cases if you can maintain zero growth that is the gold standard for this year.

James argued that it is a general statement and depends on various factors and varies according to the departments and companies.

James suggested that the customers should be segmented into various buckets based on how the pandemic has impacted them (high, medium and low impact).

Then the net retention target can be set for each segment. 

This allows you to find your own gold standard instead of copying someone else.

How about making advocacy an important part of KPIs? 

Not just NPS but measuring case studies, referral, guest blogs, webinar as these things will not have happened if you have not delivered the value.

James liked the idea given by the audience and said that metrics can be divided into leading & lagging metrics. Till now we have been talking about lagging metrics which are mostly related to the business outcomes but take longer to influence. 

Leading metrics like how many customers am I connecting to per week, how many business reviews am I doing, how many case studies have I got approvals for, they are correlated with business outcomes and easier to influence.

Some CS teams are measured on lagging while others are measured on leading metrics.

But the necessary requirement is to be empathetic and compassionate from customer POV and not have the sole aim of getting video testimonials, case studies, etc especially if the customer is going through tough times.

In these times if you do something bad, it gets amplified 100 times.

Puneet agreed and commented that the same is true vice versa too. 

Do you think a free version of a product is necessary in these times?

According to James, if you are a multi million enterprise product the answer is probably No for you. But for smaller LTV products it is a good idea to have a free plan.

Basically, if you have a free plan, this is the best time to leverage it. But if you don’t have one, it is a harder decision to decide if you want to build now and use engineering resources for this or have other important tasks that need urgent attention.

Free plan provides a good option to prevent churn.

Puneet suggested that before deciding whether to build a free plan now or not first empathize with the customer situation, figure out what needs to be done to be more relevant today and if you are a few inches or a few feet away put efforts in that direction. 

How should we talk about upsells and renewals now?

SaaS businesses earn most of their revenues through upsells and renewals. But when the economy has crashed and companies are going out of business, how do we convince our customers to renew or upsell to them?

James said that the core principle about CS is to help customers extract as much value as possible from the products they have already purchased and look for ways to provide extra value through other products or enhanced functionalities, i.e., upsell.

In these tough times, companies are unlocking premium features and providing them for free. That gives more value to the customer and it creates a ton of goodwill for the company and hopefully later if the features actually provide them value, they will pay for that.

Can we get bandwidth from different functions to amplify the playbook?

To build an effective customer success playbook, a lot of communication and one to one touchpoints are required. The CS team will already be overworked during this time so do you think we can get more bandwidth from functions which have spare bandwidth like sales, marketing (they can help in one to many messaging) or how can you leverage your CEOs, CXOs, senior management to participate and make it more impactful? Do you change the organization structure temporarily?

According to James, it makes sense. First we need to understand the “why” part and then make the plan to solve the “how” part. After that we can bring Sales, SDRs and train them on the specific plan. But it should not be a knee-jerk reaction because the other departments are not experienced in that field and may cause more damage than good. If done well it can be impactful provided the feedback we get from the customers is implemented into the business.

The seniors executives could be part of webinars, virtual meetups or can even write a few blogs which can act as a testing ground for various hypotheses. 

What if the company is asking the CS team to achieve higher metrics while the customers want discounts? 

How can the CS team communicate the customer’s requirements to their management?

James suggested that it is crucial to help the leadership better understand the customers and their challenges. For this a 2 pronged approach, i.e., Data & Customer Testimonials/Quotes should be used.

As part of the Customer Success team we sometimes focus on what we think, how customers are feeling assuming they are stressed, they want discounts but the senior management is focussed on the metrics. Hence data is key and you have to think of things that can be measured that illustrate which strategy is not working, ex- I did 20 calls, 18 calls had a negative reaction and they form this % of revenue. Here data is used to form the argument.

But this is not enough. To convince the management you need to bring in the emotional angle like how the customer is feeling also. For this you can add 2 quotes from the 18 calls which show how disappointed the customers were. Customer testimonials along with data helps you put your point in a solid manner. 

The current situation is tough but if the time for renewal is approaching it is better to collaborate with the customer and come up with a plan that works for both the parties. 

Also try to get your management in some customer calls so that they can hear from the horse’s mouth. In the case there is timing mismatch then the calls could be recorded too.

In the end, James said that the pandemic has hit everyone hard. So, with empathy and focusing on human connections, we can all go through this tough time together and emerge victorious on the other side.

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