This course is under construction. Please check back for new lessons.
Customer Success: Growth Engine for Business?
In an article titled, “Customer Success: The Third Growth Engine of Business,” Eva Klein makes the following case:
- “An explosion of information, options, and possibilities” has increased competitive pressures on businesses.
- As a consequence, “The cost of customer acquisition has ticked up steadily over the past decade.”
- Furthermore, “Buyers are flooded with previously unimaginable choice,” so they find it easier to abandon one provider in favor of another.
- She notes, “When it becomes more expensive to acquire customers and easier for them to leave, something inevitable happens—businesses start paying a whole lot more attention to keeping existing customers very, very happy.”
- Given the preceding, Eva concludes, “Customer success is the biggest emerging growth opportunity in business,” and “The most cost-efficient way to run a business today is ensuring your customer is happy and successful.”
Upon reading her article, my initial reaction was, “Hell yeah!” Too often, it seems, businesses are so eager to increase their rate of customer acquisition that they undervalue retention. Expenditures on sales and marketing are perceived as investments while, inevitably, expenditures on customer service and success are viewed as expenses to be avoided.
“The most cost-efficient way to run a business today is ensuring your customer is happy and successful.” Really? Under what conditions?
Maybe…Under What Conditions?
However, coming to conclusions regarding the allocation of scarce resources among marketing, sales, and customer success is too important to rely entirely on my (often faulty) intuition. So, I slowed down to ponder three questions:
- Under what range of conditions might Eva’s conclusions be true?
- What are the chances that those conditions pertain to your business?
- What might you do to change the odds in your favor?
It’s time for a deeper dive. The relationships among customer success, retention, and value are worthy of the attention lavished on marketing and sales.
In this series, we’ll reveal hidden assumptions and ask pointed questions. We’ll end up with a useful way to quantify tradeoffs and make more informed judgements. It’ll be fun.Customer Success: The Third Growth Engine of Business