You Mon Tsang is the CEO and founder of ChurnZero.
A turbulent economy feels like change is coming at you from all sides. Your most lucrative sales channels can dry up. Your best customers can become flight risks. Your key strategies may become ineffective. Companies that lack the flexibility to adapt to a changing business environment will become crippled by doing nothing or staying on the wrong path.
In your subscription business, you can turn the tide in your favor by investing in customer retention and your customer success team. This can help you unlock your potential to monetize existing accounts and ease the financial strain of a limited sales pipeline.
When equipped with the right data and clues, there are some remarkably effective ways your customer success team can anticipate and reduce churn risk, increase revenue and help position your business for what’s next.
1. Identify distressed customers and provide proactive support.
Your customer success team’s product usage data provides an early warning system for customers experiencing issues. By paying attention to dips in product adoption, they can spot and engage with these customers early and provide immediate support to mitigate risk.
One of our clients, whose primary clientele is restaurants and bars, executed this tactic well at the start of the pandemic. When the company’s customers started closing their doors, app usage dropped overnight. The customer success team stayed informed by tracking key product interactions such as login frequency and geolocation data to monitor the effect of mandatory business closures as they occurred. These insights gave the company the flexibility to prioritize reaching customers in real time, optimizing its approach to reducing customer churn.
2. Stay one step ahead of employee attrition to protect accounts.
When your customer’s primary point of contact leaves their position for a new role, internal or external, the churn risk for that account increases.
Employee turnover is nothing new. But thanks to technical layoffs, a more temporary workforce and the large layoff, the chances of your contact leaving have never been greater. Your customer success team needs to take steps in advance to minimize the potential impact. Account mapping is a practice that can help customer success managers reach additional influencers and stakeholders in a customer’s organization to amplify their presence and value.
To begin, document a primary contact’s main profile: title, team, key product use cases, organizational influence, purchasing authority, and internal circle, including their direct and indirect reports and their supervisor. Then follow the same process for your champions and power users. Don’t overlook a user based on their job title or hierarchy. Individual contributors can greatly influence a leader’s decision to renew.
Use the resulting account map to strategically build relationships and set up an alert to notify you when a key touchpoint’s product usage goes down, so you can jump-start your response plan.
3. Accelerate the value you deliver to stay relevant.
A recession can drastically change your customers’ financial and strategic priorities. Their top initiative this quarter could turn the following into a trivial concern. This means delivering value as quickly as possible by focusing on what matters most to customers at the time.
Your customer success team may want to consider accelerating customer onboarding to deliver critical functionality first. Prioritize features that deliver visible results. If your solution requires months of intensive implementation, consider narrowing its scope so that customers can start in half the time and see the effects right away.
The same goes for your product roadmap. Hear feedback from your customer success team (they’re the ones closest to your customers) and interrupt less intrusive requests to accommodate early release of high-demand features.
In a recession, agility counts.
Every downturn is different and its effects are hard to predict. As the eyes and ears of your business, your customer success team is key to responding quickly and decisively when budget cuts threaten your retention and revenue. Give them the strength to be agile, and you won’t just weather the storm; you will position yourself to succeed once it is over.
Janice has been with businesskinda for 5 years, writing copy for client websites, blog posts, EDMs and other mediums to engage readers and encourage action. By collaborating with clients, our SEO manager and the wider businesskinda team, Janice seeks to understand an audience before creating memorable, persuasive copy.