Customer Success is a new phenomenon and so, several companies club it with customer support. They feel that customer success is an extension to customer support.
That is NOT true.
All the functions post sales have gained importance in the subscription economy as now the power is in the hands of the customers. Anytime the customers feel that the product is not delivering the value that was promised or the customer experience is not good, they can easily move to a competing product.
Customer experience depends on how good the customer support and the customer success departments are.
Both functions are essential these days if you want to grow your company. They are like the wheels of a bicycle – both the wheels have different functions but the end goal is to provide balance and make sure that the bicycle can be used for transportation.
In the same way, both customer support and customer success help the customers use the product better so that they don’t face any problems and are able to achieve their goals.
But there are several key differences between customer support and customer success.
Customer support is a cost center while customer success brings in revenue.
As we know every company has a customer support department which consists of people solving customers’ immediate problems related to the product via calls, emails, etc.
Since the customer just pays for the product while the company has to hire customer support executives, it adds to the cost of the company.
On the other hand, customer success department is responsible for reducing churn (which in turn increases the LTV of the customers) and also upsells and cross-sells (which brings in additional revenue). The customer success department can improve your financials dramatically as the major revenue for a SaaS company comes from the existing customers.
Customer support is reactive in nature while customer success is proactive in nature.
Customer Support department takes up the issue only when the customer contacts them and shares their problem. So if the customer is stuck while using your product s/he will call the customer support and then they will try to solve the issue ASAP.
But, customer success department is proactive in nature. They try to make sure that you do not face roadblocks by informing you the process you need to follow. That way you save a lot of time and are not frustrated because you know how to use the product to the best of its capabilities.
Customer support is efficiency oriented while customer success is (obviously) success oriented.
Both the departments are measured on totally different metrics.
Since customer support is a cost center, the major focus is on efficiency, ie. the maximum number of calls (issues) that can be solved in minimum time. They are measured on metrics like Average Ticket Resolution Time, First Response Time, Average Ticket Count (daily/weekly/monthly) etc.
Customer success department is success oriented. Time does not matter if the customer is unsuccessful and is not able to achieve their goals by using your product. They are usually measured on metrics like Average Revenue Per Account (ARPA), LTV/CAC ratio, Churn rate etc.
Customer support is people intensive while customer success is analytics focused.
As a company grows, the support issues also increase tremendously. To handle so many issues, more people need to be hired in the customer support department. To improve your customer support, say decrease first response time, customer support team needs to be increased.
However, to improve customer success, the focus should be on analytics. Since each Customer Success Manager (CSM) will be handling several accounts, it is not possible to guess which customer has stopped using the product or is facing some problem. Also, it is not efficient to call each customer every week or month as that leads to time wastage and some customers might even get irritated.
Here, a customer success platform comes to the rescue. The major advantage of using a customer success platform is that it helps to figure out which customer to focus on and at what time. Basically, it helps the CSM work efficiently and effectively.
By going through millions of data points, a customer success platform shows the complete health score in terms of product health, financial, service and relationship health of each of the customers. CSMs can even drill down to individual accounts to know exactly which type of issues they are facing.
You know exactly where the customer is having problems and can then can contact the customer (call/mail etc) to solve them to make sure that they are able to derive maximum benefit from the product.
Once a customer understands the true value of the product, it becomes much easier to not only renew but also upsell. This leads to revenue growth for the company.
Customer support is responsive in nature while customer success is predictive in nature.
Normally, when a customer gets stuck while using the product, s/he contacts the customer support department. The job of customer support is to solve the issue as soon as possible so that the customer can continue her/his work.
Customer support is responsive in nature. They wait for the customers (who face problems) to contact them. It is like when you fall ill, you go to a doctor for medicines so that you can be fit again.
But, customer success works in the opposite way. Using customer success platforms, CSMs already know which customers might need their help. So, before a customer actually hits a major roadblock, they contact them to make sure they do not face that problem. Alerts can also be set on the customer success software so that CSMs can be notified when something unexpected happens and requires attention.
It is like exercising regularly and eating a balanced diet so that your visits to your doctor is reduced. That way you save a lot of time and other resources.
Customer success believes that ‘Prevention is better than cure.’
The goal of customer support is to drive customer satisfaction while the goal of customer success is to drive customer value from product.
Usually, when customers contact the support department, they are unhappy and may even be frustrated because it is stopping them from completing their work and eventually achieving their goals. The aim of customer support is to make sure that their issues are solved in the minimum possible time. If the issue cannot be solved, then an appropriate alternate solution should be provided. To do this in the best way possible, customer support executives should be product experts.
It is important that the customer experience is smooth and the customer support department is helpful in nature. Otherwise, the customer may start to hate the company which will lead to an increase in the rate of churn.
Did you know that a happy customer will talk about you to 9 people BUT an unhappy customer will talk about you to 16 people. This clearly shows the importance of customer experience!
Customer success department focuses on the long term benefit. Their aim is to make sure that the customer is actually achieving their goals by using your product. CSMs should be the domain expert and act as a coach to the customers because only if they are successful, then only CSMs can be successful.
(Source: Maranda Ann Dziekonski’s presentation in the webinar “How to start a career in Customer Success”)
Though the end goal of both the departments is to make the lives of the customers easier, each of the departments has its own importance, functions and goals. To be successful, both the departments have to work to the best of their abilities.
In a recent study, it was found out that by 2020, customer experience will overtake price and product as the key differentiator. To provide the best customer experience, you need both customer support and customer success to work in tandem.