In my role as VP of Client Success & Professional Services at NUVI, I’m directly responsible for reducing customer churn and improving retention. In the few months since I’ve arrived, we’ve improved by over 20% on our churn. This is due in a large way to my team and their very hard work as well as an overall shift in the overall focus and priority of how to approach Client Success. I will try to explain, as I usually do, through a story.
This year I’ve recently taken up running and a few months ago I had the opportunity to run two 10k races for the first time in my life. The races were within two weeks of each other on the 4th of July and the 24th of July. I completed my first race, Freedom Run in Provo, Ut, in 59 minutes and a few weeks later I finished the Speedy Spaniard, Spanish Fork, Ut in 52 minutes. I learned something very significant through this experience that applies to the overall approach to Client Success.
The first race I was worried about the finish and “pacing” myself so averaged about 10.5-minute mile pace for the first 5 miles. Then for just over the last half mile to mile, I ran my guts out at a 7-minute mile. I was very impressed with myself as I ran past many other runners during that last stretch, but I still just barely beat the 1 hour time. The second race, however, I changed tactics. I started the race out more of an 8-minute mile pace and continued that cadence for a few miles and then slowed down to more of a 9-minute mile. And at the end, I still had enough energy to push to the end at a pretty good pace. The point is, even though in the first race I ran much faster at the end I still averaged almost 10 minutes per mile, where the second I was below 8.5 minutes per mile average. My improvement was more about what I did at the beginning then what I did at the end. This same methodology for running is applicable to customer retention, and the effects are gigantic.
The Long Run
Let me explain: Retention efforts shouldn’t begin at the end of your customer’s contract but at the beginning. And for our purposes here, the beginning is far ahead of them even signing a contract.
Without the correct approach up front, our customers won’t use the tool and therefore won’t find any value in it. As we approach the end of their contract, it is a hard sell to convince them to pay us for another year for something that has no demonstrable ROI, or in other words, they have seen no success. As a SaaS company, a strategic onboarding process is a crucial component if we expect any kind of longevity from our customers.
Over the past few months, we’ve completely altered our interactions with new customers. Now, thanks to improved sales training and processes, a thorough and meticulous onboarding for each new customer, and better training for our customer service managers, we are seeing retention rates drastically improve. By reducing churn, we are protecting our brand reputation and turning a higher profit as a company. Much just to break even.
It should go without saying that every customer that doesn’t see the success in working with your tools and company will end up canceling their contract, moving to a competitor, and taking with them a negative impression about your brand. While our directional shift hasn’t been an overnight transition and certainly isn’t easy––I’m extremely proud of the progress we’ve made and can confidently say we are headed in the right direction.
On paper, this was a subtle change. It didn’t cost the company any more than doing it the old way. All it took was a shift in priority and focus. Instead of focusing on saving customers during the last months of their contract, we decided it was imperative to save them at the beginning of their contract by proving the value of the tool and making sure they knew how to use it to achieve their business goals.