According to Profitwell’s survey, customer acquisition cost (CAC) in the B2B industry has grown by more than 70% over the last five years. Keeping that in mind, knowing how to retain your customers and making sure that they’re getting the most value from your product is crucial for continued, sustained growth.
In today’s market, B2B SaaS companies are expanding through product-led growth. But how do they retain their new customers and get them using their product consistently? The answer lies in product-led customer success.
Defining product-led Customer Success and it’s importance
At its core, product-led customer success isn’t much different from the “traditional” customer success mindset everyone is accustomed to. But the biggest (and most important difference) lies in how we approach the customer and set them up for success with our product.
What makes a product-led customer success approach special?
Unlike traditional customer success, product-led customer success is based on the constant monitoring of your users’ in-app data, behaviors, and engagement, along with assessments of customer health. In other words, product-led customer success strategies are triggered by product usage and in-app metrics.
By knowing the stages where users feel stuck, where exactly they found obstacles, and how to help them will not only help you to boost your overall trial-to-paid conversion rates, but it will also improve your retention and overall customer success and growth.
Product, more specifically in-app, data tells us exactly how the customers feel when they’re inside your product. Instead of making guesses around how we can help our customers, we know exactly what needs to be done. Maybe it’s a quick demo call, sending some helpful resources, or something else. Since it’s the product that’s driving growth now, we need to start using product data to tailor the perfect customer experience. This is the most effective way to ensure a successful long-term relationship.
Now, if you want to learn how to “do” product-led customer success, keep reading! In this article, we’re going to show you strategies and tips to reduce churn, improve retention, make customers happy, and boost growth.
Product-led customer success: The Three Pillars
If you want to find success with product-led Customer Success, you’ll need to set up a few things first. Here’s are the three pillars you’ll need to get started:
- Clearly defined user journey(s), user onboarding, and feature adoption flows
- Various user segments (both account-based and product-based)
- The ability to proactively reach out to and educate customers (both in-app and out of the app).
Now let’s break down each of these and how they drive product-led customer success.
User journeys, user onboarding, and feature adoption flows
You won’t be able to proactively reach out and make your customers successful if you don’t have a proper user journey, user onboarding, and feature adoption flows. Without these, you won’t be able to trigger different user behaviors and measure their overall satisfaction.
Remember that one of the main differentiators of product-led customer success is scalability. With the user journey, you will be able to know where exactly your customer feels stuck, and how you can apply this knowledge across the product.
The overall user journey(s), user onboarding, and feature adoption flows may differ from product to product, but some general rules apply to everyone. Two moments in your user journey(s) or user onboarding are particularly important:
- The “aha” moment: when your user perceives the value of your product/feature (when they realize what the product can do for them)
- User activation point: when your user actually feels the value of your product/feature (in other words, when they try it and experience the benefit).
For the user to be activated and considered “adopted,” they need to go through several “aha” moments and user activation points for every core feature. User onboarding and feature adoption flows are based on different behaviors and triggered by in-app experiences.
In-app experiences that are triggered by the users’ context or actions (such as trying to use some new feature) are the new way of onboarding users and adapting them to your features.
Now let’s move on to the second pillar of product-led customer success: user segmentation.
Product-led Customer Success: Segmenting your users
There are two different user segmentation methodologies that work with product-led customer success:
Account-based user segmentation: segmenting your users based on account data (company size, premium clients, free trial, etc.)
In-app user segmentation: segmenting your users by different in-app events, such as the time when they were last seen, the number of features they activated, and so on.
The Key to Product-led Customer Success: Proactive Outreach
One of the main purposes of product-led customer success is reaching out to your customers exactly when they need it.
This requires proactive, fast, and educational outreach. Fortunately, thanks to your user onboarding triggers, user journey(s), user segments, and user identification, this won’t be too hard. Especially because you’ll know exactly how to reach out to and help them.
Key Takeaways
In a nutshell, product-led customer success is a scalable way of constant customer education. Its mission is to make your customers happy and successful. Product-led customer success is based on three main pillars:
- Carefully planned user journey(s), user onboarding, and feature adoption flows
- User segmentation and user identification
- Proactive outreach
Originally published on Productcraft by Pendo
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