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3 Steps for Rethinking Your Customer Relationships
In an increasingly transparent economy, value is key.
Posted Jul 11, 2014
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People don't have to own anything anymore. We can subscribe to almost any service or product and change our minds whenever we want, whether it's Spotify or Birchbox or even any type of enterprise software-as-a-service. And in a world where software is leased instead of owned, customers dictate everything. Current pay structures, from freemium models to pay-as-you-go services, put power entirely in the customers' hands.

It's also a new day as far as the tools and technologies that companies rely on to do business. Rather than just automate and process, enterprise software has the incredible capability to listen, understand, diagnose, and discover.

These trends empower businesses through data-driven insights to inform interactions with customers, and, in the process, have put an end to customer relationships as we knew them.

What's emerging is an increasingly transparent economy in which value is the key. Not too long ago, companies could lie a little about their products, take you out to dinner, get you tickets to a ballgame, and that would be good enough. No more. Companies must be in tune with customer needs at all times to proactively maintain positive relationships. The world has changed, and suddenly the perks of relationships have given way to the much more satisfying effect of value.

This is not to say relationships don't matter. They do. Even in the future, great brands will be built based partly on emotional connections. But such emotional connections will only thrive if the rational connection is there.

I've come up with three ways that companies can rethink customer relationships to reinforce that rational connection and thrive in this new world.

Provide Value Over Customer Management

Stop spinning your wheels to reinvent better processes to manage your customers. Of course, having such systems in place is an organizational necessity for the enterprise, but it does not always offer tangible value to the customer. Realign your resources to deliver a meaningful experience that has an invaluable effect on your customers' bottom line. That is much more effective than any supercharged process for things like customer check-ins or quarterly business reviews.

Track Smarter Customer Metrics

Enterprises must track more than just a customer's place in the subscription cycle. Above all, companies need to measure and understand if a customer is finding value in a product. The best way to do that is by listening to what customers are doing—and not doing—inside your products and services. One-off conversations, surveys, and opinions don't paint a complete picture of your customers' experience. Customer actions, however, don't lie. Allowing usage to dictate your actions will make sure that your engagement is streamlined and relevant to each customer's specific needs.

Furthermore, make sure you're tracking things as they happen. With free trials, freemium products, and monthly subscriptions, companies need to act at the right moment for their actions to make a difference. Waiting for data to come in and get processed on a quarterly, monthly, or even weekly basis is too slow. The best companies use sensor-based technology that gives them a window into real-time digital signals for their customers.

Get Rid of Customer Classifications

Some companies habitually make distinctions between "high-touch" customers and "low-touch" customers, "decision makers" and "users." This is looking at the world from your perspective, not the customer's. No customer likes to be seen as the "low-touch" account. Best-in-class companies have extensive, diverse customer bases ranging from large enterprises to fledgling start-ups. They make sure every customer (no matter how big or small) is engaged. They build and nurture passionate user communities. Investing in technology that ensures all customers and users are successful and finding value is an imperative.

These three action items sound simple enough but can get tricky when executing at scale. SendGrid, the world's leading email delivery service, is a prime example of a company doing this well. Several years ago, the company's founders made a brand promise to deliver industry-leading customer experience. Company leadership realized that this went beyond offering 24/7 support (which it already did), but it didn't mean assigning a customer success manager to each account either. With more than 150,000 enterprise and SMB customers, the most effective and leveraged way to do this was to identify customers at key stages of the customer life cycle and engage them in a timely and relevant fashion. Today the company helps its customers send more than 13 billion emails per month.

The binding force that links these three things to scalable success is smarter software. Smart software empowers businesses with insight pulled from big data to better understand what customers want more than what enterprises need. Each employee should and can be informed enough to build more mutually beneficial relationships with customers that are grounded in the customer's success.


Guy Nirpaz is CEO of Totango, a software provider that gives companies an ongoing picture of how customers are interacting with and using online services.


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