Early on, we decided “customer love” was a requirement, not an option. For many companies, the goal to treat customers better — to appreciate and listen to them — is important, but hard to justify in a business context. Prioritizing something “fuzzy” like customer love is often viewed as a nice-to-have, but it can’t justify the investment because ROI is too vague. We beg to differ.
If your customers love you, they are more forgiving of mistakes, loyal and willing to evangelize for you. And yes, loyal customers tend to translate into a higher lifetime value (LTV).
But how can you measure customer love?
Measuring customer love comes down to five key metrics: low churn rates, higher margins, deeper adoption and account growth, increased influencer/evangelist marketing and accelerated product development. Let’s take a deeper look at how to approach each of these metrics.
1. Low churn rates
It’s no secret that your most vocal critics can turn into your most loyal customers. But customer love is required to take a buyer from a negative space to a positive one. Without it, customers are likely to jump ship and hop on your competitor’s boat.
For those who have been paying attention to the growth of the customer success software industry, we’ve seen companies like Gainsight, PreAct (cloud-based customer success system) and Tatango (mobile messaging software) appear on the scene to fix churn issues. Customer success management platforms are designed to drive revenue and increase retention.
As each of these companies will tell you, the most important thing you can do to maintain high rates of revenue growth is keep your existing customers happy and using your products. By improving customer engagement and proactively solving problems you’ll impact churn rates.
2. Higher margins
If you adopt the customer love philosophy, customers will understand and appreciate the value-add they receive from personalized attention, and they’ll be willing to pay a premium price.
Customer love isn’t about exceptional customer service. It’s about caring enough to earn your customer’s respect by going out of your way to provide them with an exceptional customer experience every single day.
Make it your mission to understand their wants and needs. Then, structure your offerings around their interests. Your customers will appreciate it and you’ll create a better product or service in the process.
3. Deeper adoption and account growth
When it comes to measuring the impact of customer experience on the bottom line, focus on inputs to your lifetime value calculation.
Churn, adoption, satisfaction, growth in spend, assistance in customer acquisition; these are all ways in which happier customers vote for your business with their actions. Investing in your team and processes in order to delight more customers will pay you back in spades.
4. Increased influencer and evangelist marketing
At Apptentive, we’ve seen incredibly high retention rates for a SaaS business, with a tremendous amount of evangelism and sharing. In our enterprise business, we’ve seen a 99 percent retention rate in the last year.
Our customers go to bat for us. They recommend us to their colleagues and work with us to make our product better. The symbiotic relationship between our team and customers ensures we’re building something that matters long-term.
5. Accelerated product development
As a technology organization, we often look at a blank slate with the opportunity to build anything. But the challenge is picking what to build. Increasingly, an active and ongoing conversation with our customers helps us identify the larger, strategic, commonly valuable capabilities that deserve attention.
In an environment where customers understand you’re listening, they’re much more likely to tell you their biggest problems. Anytime you can cut waste from the product development process and emphasize the most important work, you’re putting money back in your pocket and often, accelerating revenue growth.
Earning customer love should be a priority. Determining ROI can be tricky, but the rewards are tangible. Fruitful long-term relationships with customers are necessary to long-term success, and earning customer love is the first step.
This article has been edited.
Robi Ganguly is the CEO of Apptentive, the easiest way for companies with a mobile app to listen to, engage, and retain their customers.