INDEED, HOW GILD DROPPED MONTHLY CHURN FROM 4 TO 1
You have created successful lead-gen programs and have increased your sales. Your revenue has increased. But what are you doing to ensure that your customers are successfully using your product?
Customer Success is the key to make sure that the customers meet the desired results. If you want to build predictable revenue, then you need to keep your customers happy and keep them coming back to you. FaceValue Application, the Purchase Generator, helps you to load the customer details into CRM, automate the messages and keep a constant watch on the customer responses.
A high customer churn rate is scary. It is the enemy of hyper-growth. So what can you do about it?
Gild, a business helping companies recruit engineers, was also trying to reduce customer churn. They finally succeeded in reducing the monthly churn from 4 to 1. Let’s see how.
How did Gild start off?
Gild uses the data available on the web to measure the abilities and guide companies to recruit engineers that match their profile. Brad Warga joined as the Senior Vice-President of Customer Success in Gild. He was the sixth person to join Gild after the CEO, CTO, CSO, Head of Sales and Head of Marketing. Brad has over 20 years of experience in which he was also the VP of Corporate Recruiting at Salesforce.
In the initial period, Brad brought in new customers for Gild, bringing the total to 50. Since the contracts were annual, the churn was low. This was until the contracts came up for renewal and the churn jumped to 3% to 4% per month.
Generally, SaaS companies want their churn rate to be less than 15% in a year. But in Gild, the churn per year is more than 30%, which was two to three times their target!
How did gild reduce the monthly churn by three-quarters?
To find the root cause of the problem, Gild started to analyze the reasons for such a high churn rate and came across some astonishing findings. They found that just looking at the frequency of people logging in wasn’t a good metric to work with.
They dug deep and found the need for more details like:
- Which parts of the products were used?
- How were the features used?
- How tech-savvy are the customers?
- What requirements do they have?
- How are their products satisfying their needs?
By finding answers to such in-depth questions, Brad and his colleagues systemized Customer Success and reduced the monthly churn rate to less than 1%.
The Three Methods That Helped to Drop the Churn
1. 90-day adoption
The relationship between the Customer Success team and the customer starts as soon as the customer purchases the product. Gild found that if customers are successfully using the product within the first 90 days, then the usage will be three times higher for the rest of the year.
Therefore, the Customer Success team trains the new users about how to use the product and the best practices to follow to get the users excited about Gild.
2. Quarterly business reviews
The business reviews every three months are completely formal. It holds the customer accountable for buying the product and also helps Gild to understand the right customers.
3. Using predictable tools
Gild used the Customer Success applications like Gainsight, Zendesk, Salesforce.com and Olark.
You can also use the FaceValue Application to monitor the customer feedback, analyze the metrics and gain actionable insights that the CS reps can use.
Gild’s customer success strategy
To make this happen, the Customer Success team of Gild has grown to 10 employees, out of the 50 employees in the company. There are three main roles in Customer Success:
- Inside CS reps (one rep per 70 users) to train and monitor the usage of the product.
- Outside CS reps (one rep per 30 users) to handle and measure on renewals.
- Executive CS reps for upselling with fast-growing customer segments.
The Customer Success team at Gild is responsible for the 90-day adoption, renewals, upsells and feeding feedback into the product roadmap. With these functions, Gild’s Customer Success team was able to minimize its customer churn rate from 4 to 1.
Are you looking for the best tool to implement a Customer Success strategy like Gild?
Load your customer information into the FaceValue Application’s CRM and keep engaging with them regularly. Monitor their behaviour with your product, automate regular messages and feedback sessions from within the application and use this information to improve customer satisfaction.
This blog is excerpted from: ‘From Impossible to Inevitable: how hyper-growth companies create predictable revenue’ co-authored by Aaron Ross and Jason Lemkin.
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