How to Measure Customer Success Outcomes
Marketing is all about setting goals, analyzing campaigns, and measuring success based on whether you met those goals. Simple enough, right? The complicated part is that you can use thousands of different metrics to evaluate your marketing, depending on what your company is trying to accomplish in the near-, medium-, and long-term future.
Quantitative vs. Qualitative Goals
Most marketing goals are quantitative (based on hard numbers) because they’re easier to measure that way. If you set a goal to double website visits, you can tell immediately whether you’ve met it or not. The same goes for lead collection — marketers tend to focus on quantity over quality. Quantity is a simple matter of counting, while quality requires a much more in-depth analysis.
The downside of quantitative KPIs is that they’re often giving you pretty shallow insights. You can tell how many people came to your website but not why. You can tell how many leads you’re bringing in, but not what each person needs. You need a mix of both types of metrics to gauge your marketing success.
Pure demand is essential, and there will always be some part of your company that’s focused on bringing in more leads, but it’s not the only thing. Instead, what we’re suggesting is that you should be judging yourself based on the connection between your goals and your customers’ success. So how does that look?
Churn and Renewal Analysis
Successful customers stick around, renewing their subscriptions and making repeat purchases rather than churning at the end of their first year or free trial. By diving into the numbers, you can figure out what’s leading to their success or failure. What you’re looking for are the things that your best, most successful customers have in common. That will start with the customers themselves — their income levels, job titles, locations, and similar characteristics.
Then, you’ll start to look at usage. Let’s say you make a project management software, and you’re wondering what your best users have in common. You notice that when people only use your software through the web interface, their retention rate over the course of six months is only 20 percent — not optimal. But the customers that use the web interface and the browser extension show a 40 percent retention rate, and the ones that download the mobile app show an 80 percent retention rate, which is much more encouraging.
The lesson is to find the customers who are only using the web interface and promote the browser extension and mobile app — if you can get them to download those, they’ll be more likely to adopt the software and renew their subscriptions.
The same goes for churning customers. There may be certain areas of onboarding that they didn’t get through or certain features of your product that they never used. If you can identify those speed bumps, anticipate them going forward, and help future customers get past them, you’ll significantly cut your churn.
You’re almost certainly already segmenting your customers by the size of their account, the number of people working there, how long they’ve been customers and other quantitative data points like that. Quantitative segmentation is incredibly useful and shouldn’t be neglected.
But you should also be segmenting your customers by how they feel about you. Customers who have been the most receptive to your customer success efforts are more likely to be open to cross-selling and upselling, for example, so they’re the perfect target for marketing emails about new and expanded product lines. Customers who are more lukewarm about you, on the other hand, might benefit the most from an email offering them a free, live walkthrough of your product’s features and capabilities.
Ask Your Customers What They Think
You can start with NPS surveys. NPS (Net Promoter Score) surveys aren’t a new system, but they’re time-tested and straightforward to administer. You simply ask your customers to answer questions on a scale of one to ten, usually starting with some variation of “How likely are you to recommend our product to a friend or colleague?” Then, simply break down your customer list by their responses:
- Anyone who answers a 9 or 10 is a “promoter” who loves your product and will tell other people about it. You want to keep them happy, but they don’t need much extra attention.
- Anyone who answers with a 7 or 8 is a “passive.” They’re satisfied with the product, but they’d switch if they found a better option. They’re not likely to talk down about you, but they’re not selling your product either. With a little extra attention, you can turn these people into promoters.
- Anyone who answers a six or below is a “detractor.” As of right now, they’re not happy with your product and probably won’t purchase it again. They might even be actively complaining about you online, which is hurting your reputation. Every company has detractors, but if their numbers start to become worrying, you need to reach out to them and find out what’s wrong.
You can generate NPS-based segments with just the single question we mentioned above, but you can also get much more granular with the questions you ask them, focusing on specific features instead of the product or company as a whole. For example:
- How easy was it for you to begin using our product?
- How integral is our product to your daily life or workflow?
- How likely are you to renew your subscription at the end of this term?
- Do you think the pricing for this product is fair?
- How satisfied have you been with the service you’ve received from this product?
And so on. Each of these questions will divide your customers into segments that you can triage accordingly, either rewarding their loyalty, giving them a helpful nudge, or diving into why they’re so unsatisfied.
NPS surveys aren’t the only tool you can use for this kind of segmentation. If you’ve got a big social media following, use it! There are plenty of online tools to create surveys, like SurveyMonkey, Qualtrics, Google Forms, and more, that will give you a robust analysis of your results. Create a survey on one of those platforms and send it out to all your social followers. It won’t be as easy to connect social accounts to individual people in your CRM, but you’ll still get a sense of what people like and don’t like about your product and your company.
More Ways to Segment Your Audience
Some other segmentation methods to try include:
- Demographics: look for correlations between demographics and the metrics we’ve talked about above. Do young people have an easier time getting to know your product? Do people in specific industries use it more often?
- Usage: segmenting your customers by how often or how much they use your product can be extremely useful. Some might use it every day, while others only check on it once a month. Their needs — and your messaging — will be different.
- Onboarding outcomes: you want to know that your customers came out the other end of your onboarding process with a thorough understanding of how to use the product. If they jump right into all the features, you know it’s been a success. If they don’t, they might need more help.
There’s no limit to the amount of segmentation you can do as long as it’s useful. If you create segments based on your customers’ hair color and it doesn’t get you any actionable information, you can just scrap those segments and try something else.