Customer Success Magazine
By Mikael Blaisdell

no-churn-TM-Feb11-SMIn 2013, the US venture capital community committed approximately 50 million to fund companies developing solutions specifically focused on helping companies to retain their customer relationships.  The exact figure may be higher, as there are a number of firms still in “stealth” mode at this point.  This amount does not include co-founder self-funding for smaller start-ups, or investments made by companies to expand or extend their existing products to add customer retention functions and features.

csassoc-logo-tag-webAll across the SaaS industry, companies have been hiring people dedicated to the retention of customer relationships.  The titles vary widely, Customer Success Management being the most common, but all have a common mission: to stop/reduce churn.  The Customer Success Forum on LinkedIn, the premier online discussion forum for the emerging profession, began the year with 1,800 members worldwide.  Today, there are more than 4,000 — with more than 150 newcomers every month.  A new professional organization has formed, The Customer Success Association, and it held its first conference, CSC-MainCustomer SuccessCon East, in Boston on December 5th.  Customer SuccessCon West followed on January 23rd, and Customer SuccessCon Europe is next on April 3rd.  (CSC East will again be held in Boston next September.)

If 2013 was a fast ride, what’s to be expected in 2014?  More new vendors, vastly increased numbers of new CSM roles in SaaS companies globally, some industry “giants” taking very serious looks at formally building their own customer retention programs and teams… hold on to your hats and place your bets!

Customer Success Map Check

Clearly, SaaS Customer Retention has become a matter of serious concern and attention across the industry.  Have we hit the tipping point as a role/profession?   If not, it won’t be long.  The more important question to ask at this point is: are we headed in the right direction?

Broken RelationshipIt’s relatively easy to say: “You, you and you — stop that code-red customer from leaving, and then start the rescue operations on the others on the at-risk list.”  Stopping or reducing churn only begins when somebody takes ownership of the situation and becomes accountable for performance.  But if that’s the whole of your mission, your effectiveness at that task is inherently limited — at best, you’re leaving a lot of money on the table.  At worst; you’ve been set-up for failure.

It’s time to look much farther, to realize that just owning churn-reduction is a narrow, negative, and reactive approach to SaaS that ignores what’s really at stake.  A SaaS company either actively manages its customer relationships as strategic portfolio assets, or it effectively cedes control over them and the company’s future to chance and/or the competition.  Customer acquisition is only the very first step in what must be a long-term, scientifically engineered, and professionally directed strategy.

Designing and Building for the Future

The relationship with the customer begins long before the first formal contact with a sales rep.  Impressions are being formed, expectations set —  that may turn into leads/contacts.  Now is the time to initiate a seamless program for selecting and nurturing those leads that have the greatest potential for becoming top-tier partners/customers, and for engaging the team that will guide them all the way along the desired path.  That’s not a job for a fire-fighter squad.  The role is much, much more, it’s a core component of the company’s global game.

If you’re ready to be serious about looking beyond basic churn-reduction, here are some resources for you:

The Customer SuccessCon Events: West / East / Europe

The Customer Success Association:

(This article was originally published in The HotLine Magazine. []  It has been slightly revised since then.)

January 31, 2014