Do you have an addiction to new customers? You likely have a sophisticated sales and marketing funnel which converts leads into prospects, and then prospects into customers. Yet, as you proudly ring the bell to celebrate the new logo, existing customers quietly slip out the back door.
Despite all this talk about Customer Success, companies still bring in new customers but don’t onboard them in a meaningful way. The impact of generating new disengaged customers means that even though bookings from new sales look awesome, your business may be in a death spiral, or will be soon. While software as a service makes it easier to sell, it is also makes it easier for customers to leave. Due to customer acquisition costs (CAC) it could cost you up to nine times more to acquire a new customer than to keep an existing one. CAC means it takes one renewal, two, or even three renewals to make a profit on that new customer you worked so hard to bring in. So, when you sign a customer and they churn in the first year, you lose. This means you could be in a death spiral and don’t even know it. Do you know how long it takes to get to profit with new customers at your company? If not, find out.
Onboarding is the critical period after the deal closes when new customers must be guided to success. This is also the time when customers are most interested in making a difference with your product. Yet, despite the importance of this period the main cause of churn is a poor onboarding experience. When customers don't realize the value of your product quickly, then you'll be playing catch up to avoid churn. Don’t make these four onboarding mistakes with your new customers.
Ad hoc onboarding. You have a sophisticated buyer journey and no onboarding strategy. You throw the product over the wall to new customers and then hope they figure it out. You’re available to solve their problems, but that keeps you and your team in the reactive zone and leads to a higher chance of customer churn.
Onboarding = CSM. Are your CSMs trying to do it all? At most companies I talk to, each CSM single handedly tries to onboard, train, and support customers. They log support tickets and pull heroics to keep customers happy. How can your teams scale when you are locked in a one to one approach?
Silos. You likely have great customer-facing services, programs, and content. In fact, content is everywhere. The problem is you task customers with figuring out where to go when. When nobody ties together best practices to guide customers along their onboarding journey this again keeps you and your team in the reactive zone.
Technical Weeds. The software is sold and immediately you dive into the technical weeds of implementing your product. You are deep into resolving issues without any discussion of what success looks like. Without handoffs, kickoffs, quick wins, or planning, there’s no big picture that defines roles, responsibilities, outcomes, and accountability.
The solution to these onboarding mistakes is orchestrated onboarding. Orchestrated onboarding includes the following best practices to keep you and your customers from wandering down dark alleys during the most important part of the customer journey.
Orchestrated Onboarding Best Practices.
Prescriptive guidance. Rather than ad hoc onboarding, consider the impact of prescriptive guidance during the most important part of the customer journey to guide customers to their desired outcomes, rather than waiting for them to have problems.
Cross-functional teams. New customer onboarding is not the job of one person. Instead leverage all the expertise your customer facing teams have to offer and use that to guide customers down a well-lit onboarding path.
Curated journeys. Break down silos and connect the dots between CSMs, Training, Support, and Consulting, plus all the content each team creates. Design a scalable and curated journey for customers rather than provide random touchpoints and content.
Success Plans. Build a success plan to provide a best practice for how new customers can reach their desired business outcomes. Success plans include details about the desired business outcomes, quick wins, roles and responsibilities, training and consulting, and identifies gaps and risks. Success plans keep your customers accountable during their onboarding phase and beyond.
How is your customer onboarding process working for you and for your customers?
Take another look at the four onboarding mistakes above and consider what looks familiar. Next, take a look at the orchestrated onboarding best practices and determine where to quickly make an impact. Schedule a meeting with other customer facing teams to see how you can align and collaborate. Create a learning path that leverages existing enablement content. Don’t delay, because McKinsey says that onboarding customers is the most important part of the customer journey. When you carefully monitor and engage customers throughout rollout, you are on the path to a lucrative customer relationship.