How to prevent client churn with customer success management

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One of the key takeawyays from the Pulse 2015 conference in San Francisco last week was an insightful talk on how to prevent customer churn. Dave Moran, general manager of customer analytics for Marin Software, presented on his company’s learnings from taking advantage of customer success management.

As an ad tech platform provider, Marin Software helps ad agencies with search, social and display ads. Or as Moran described how his mom thinks of it, “We’re the guys who send those annoying popup ads when you’re on the Google!”

In reality, Marin Software’s application is a very sophisticated ad bidding tool within which the customers live and breathe, according to Moran. Therefore, a large customer success management (CSM) force is necessary to defend against customer churn, he says.

Marin Software also has a traditional account management (AM) model to drive revenue growth. Overall, it has 120 CSMs and AMs in a 520-person company.

With a very engaged customer base, the hands-on Marin Software ad-spend program helps customers optimize their outlay. Based on that customer intelligence provided by Gainsight, Marin Software CSMs receive actionable data into their customer churn rate. “Churn data is not sexy,” Moran says. “But it’s one thing that lets ask why we’re losing customers.”

Dave Moran, GM, customer analytics, Marin Software
Dave Moran, GM, customer analytics, Marin Software

When the Marin Software team started out with its CSM program, the churn coding was really rich. “The churn dropdown menu had a lot of ‘other’ categories,” Moran says. “The CSM report was garbage data.” It led some executives to have a cage match fight over data that wasn’t usable, according to Moran.

This prompted Marin Software to take a Dumpster dive on the old data, especially on the lost deal data. CSMs were interviewed. Turns out the “products” option in the lost deal data was a catchall. So that’s where the cleanup started. They added more specific sub-categories such as “feature not available” or “competitor has feature” and “feature not being used” for customers who only used Marin Software for reporting.

But one of the main reasons Marin Software was losing customers was lack of performance, according to Moran. To combat that downturn, Marin Software had to have intel on how the product was being used. “We needed to get the product use signals; needed to monitor product usage,” Moran says. “If it drops off, what are the true risk signals?”

While all this product usage data helps Marin Software CSMs keep current customers engaged with the product, even bigger opportunities exist come renewal time. “For renewal opportunities, if you don’t know about alternatives you can’t consider them,” Moran says. “If the data is not there you need to automate it.”

At Marin Software, 90 days out from a customer renewal an automatic flag will go up to review the opportunity to make it a workable subject, Moran says. Otherwise, the CSMs are underwater, so the renewal data is surfaced to them.

Marin Software uses Salesforce and Gainsight as part of its workable playbook for renewal.

With so many renewal opportunities coming up on a daily basis, Marin Software uses a data warehouse and visualizes them in Tableau. “That lets us know what is churning and why,” Moran says. “And it leads to a super crisp, clean executive discussion now.” There is still discussion over customer renewals, but no one has creative license to make up their own facts now, according to Moran.

Not every customer renews but Marin Software still takes the action to conduct exit interviews with lost customers. However, customers don’t want to talk about lost business very often. So an independent third party will conduct the interviews. Based on the interviews, Marin Software will go back to re-engage the customers when the features they wanted are available.

Churn risk management and prevention


When it comes to solutions for churn risk management and prevention, there is no one-size-fits-all, according to Moran. B2B firms can see a range of breakdown signals, such as customer support cases opened, bill payment frequency, number of customer webinars attended and so on. Plus, lost session analysis will give us a handle on how to do better, he says. This keys on clicks and logins. However, you have to go deeper and think about the data or you’ll miss the meaning, according to Moran. “Gainsight goes deeper. There are combinations across features that you need to know about,” he says.

To help with churn prevention, spend a ton of time on customer journey mapping, Moran advises. With journey mapping, “It’s fast to go back to look at lost trends and opportunities,” he adds. For example, when considering the retailer segment, Marin Software uses certain keywords that could predict product usage. “It was important that we made sense of lagging meta data.” However, when you go deeper on product usage data, you have to ask if it passes the “so what?” test for that data to be actionable, according to Moran.

Partnering for customer success

Even with all this product usage data in hand, CSMs cannot just be partners. B2B leaders must achieve consensus. There must be agreement about what the product usage data categories are in order to tell the whole story. In Marin Software’s case, it mapped the product usage data back to the product brochure. “That keeps things orderly and efficient to be able to find trends and take action. Because of our monitoring, we have a better way to map.” This is especially important for tying in verticals because of all the nuances they have and the different expectations for performance.

Moran likes to deliver the product usage trends on a frequent basis by using Gainsight defensively. More important than the trends themselves are the trend positions. That leads to the requirement for the CSMs to get the whole churn story. For example, after 30 days of inactivity, they have to go to the customers and find out why they are not logging in or not using certain features, according to Moran. “Some customers don’t want to hear it, but we need to know,” Moran notes.

Marin Software would rather take a proactive approach to customer churn management, so they don’t have a churn committee. “Not that that’s not valuable, but it seems more academic,” Moran says. “We let churn management live day-to-day in the customer playbook and dashboard.”

The remainder of Moran’s talk revolved around customer case studies. One customer hadn’t received enough training to use the Marin Software ad bidding and rebidding functions and the CSM was able to pick up this signal in Gainsight and thus arrange for training. In another case, a CSM was monitoring the customer’s application performance in the form of page load time and headed off the customer complaint by letting her know there was a problem and that it was being worked on.

Other customers who only used Marin Software for reports, and CSMs were relentless in finding out why only that functionality was being used. While the customers liked Marin Software’s other features, they hadn’t matured enough. Turns out that the sales people had glossed over those features and the CSMs had to dial back customer expectations.

“We have to talk to the customer about targets to map into the strategic account plan,” Moran says. “Tying our performance goals to the customers’ goals helps us define their plans and manage tasks. It’s important to tie your success to customer success.”

So keep a record of the value definition at the customer. Otherwise, shifting sands or the product champion leaving the customer will make it hard to achieve success. Have a quarterly recalibration with the customer and poll the current goals. The CSMs need to ask the tough questions to surface data. They need to ask 90 days out from renewal if there’s any reason the customer wouldn’t re-up. This forces a dialogue and could result in finding out if there are others with which to engage.

“And if it’s the right tier, we will focus on keeping an angry customer from churning,” Moran says. “For example, we will put an independent training resource on a plane to go see a customer or arrange for a meeting with the EVP of products, who knows how to articulate and not promise too much to the customer.” This capability is important for customers big and small, according to Moran.

Read our other Pulse coverage here and here

Photo via Buffer.com

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Derek Handova

Derek Handova

Derek Handova is a veteran journalist writing on various B2B vertical beats. He started out as associate editor of Micro Publishing News, a pioneer in coverage of the desktop publishing space and more recently as a freelance writer for Digital Journal, Economy Lead (finance and IR beats) and Intelligent Utility (electrical transmission and distribution beats).
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