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A Retention-Focused Strategy that Shoots Straight for Growth: Customer Success

Blog by Ian Luck
February 14, 2018

Long before Customer Success became the hot new kid on the scene, Customer Experience had been touting many of the same ideals as Customer Success. So what’s the difference then, what’s the big deal with Customer Success?

This article is a short discussion about:

  • How Customer Success is a strategy for every industry and company
  • Customer Success in relation to Customer Experience
  • Many companies practice Customer Success; they just don’t know it
  • Why Customer Success is a valuable strategy

Customer Success

Customer Success has been somewhat of a magic pill for SaaS businesses. Although this is an exaggeration, it has for many companies been the strategy that has steered them away from the never-ending cycle of attrition and acquisition towards steadier growth. So the question is: Where does that leave everyone else, where is their magic pill?

Subscription or service based models now take advantage of well-executed Customer Success strategies or put more directly they now find it extremely necessary to have high retention. However, is a strong focus on retention any less important for other industries?

Whether it is the subscription model, transactional or some variant in-between, companies that have high attrition rates are like a dog chasing its tail. Endlessly pursuing growth, as each lost customer needs to be replaced with two more.

However, many companies have survived and even grown with what could be considered high churn. These companies most likely had fantastic sales teams or brilliant marketing tactics, but the fact of the matter is that this prosperity had to be worked for doubly hard.

Retention is nothing new, but the determination amongst subscription and service based industries leaves other industries thinking Customer Success is neither for them nor as necessary. This couldn’t be further from the truth; the only difference is simply that some have woken up to just how costly churn can be!

Retention isn’t anything new, but how we envision creating it can be

Customer Success says that to retain customers you need to make them successful with your product or services; meaning you need to make them see the value of your products and services.

Customer Experience though has been championing the merits of retention long before Customer Success even came about, and as such why choose one over the other.

This misconstrues the function of both domains, for the two are not opposed to each other nor is one a part of the other. For Customer Success is about discovering and understanding what provides value to customers, while Customer Experience is the process by which to attain these objectives.

As a result, those that see the value of your products and services will more likely remain as customers. How companies go about creating such value is through the process of Customer Experience, which could mean a focus on such things as customer service, product quality, price, etc.

Customer Success that isn’t called Customer Success

Zappos is a great example of a company that is focusing on Customer Success but is rarely ever referred to as such. Instead, it is more commonly framed as being about “amazing customer service.”

So what makes Zappos' amazing customer service, really just Customer Success in disguise?

As an e-commerce seller of big brand shoes, they exist within a market space that consists of a large number of competitors. To differentiate itself, Zappos decided to create its own unique value for their customers, a value so strong that their customers would choose each and every time to shop with Zappos.

To do this Zappos created an unforgettable experience for their customers, specifically through the means of a Customer Service team that will pretty much do anything a customer desires. For example, service representatives tracking down late-night pizza places for callers.

What Zappos realized was that to create value for their customers, such value would not come from the product they sell but in the experience they created around the product. Creating amazing customer service has been so valuable in the process of buying shoes that Zappos now benefits from a very loyal customer base.

Customer service is the process or means to higher retention. What creates value is knowing Zappos’ service attendants will do more than any other competitor to resolve issues surrounding purchasing shoes.

Customer Success: The single message strategy

Customer Success is not a radical new approach to improving a customer’s experience nor does it strive for any new unheard of goal. It is a strategy that focuses on retaining customers by providing products or services that the customer values so much so they can’t do without – what specifically creates that value is up to the customer.

So why care about Customer Success at all?

Customer Success has one simple focal point, as other customer strategies encapsulate multiple objectives. And while there is nothing wrong with this, Customer Success provides a refreshing message - that retention through valued products and services is a pathway to easier low-cost growth.

So while subscription-based companies have strongly adopted such a message, it has mistakenly been assumed that such a message only benefits the subscription-based world. No matter the industry, business model or market circumstances; it is a strategy that all companies can benefit from.

In short Customer Success is:

  • Widely used by the subscription-based industry, but is a retention strategy that can be adopted and beneficial for all.
  • Creates retention by creating valued products or services, customer experience is the process undertaken to create value.
  • Customer Success aims for one thing only: retention. After which high-value purchases and new sales from word of mouth can arise.
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