The success of your product or solution doesn’t stop with turning a prospect into a customer. It depends on the value it can add to your customer’s business. This is especially true of SaaS. Customers need to see enough value to convince them to renew your service each time.
So value delivery is the process of helping your customers experience the value you promised your product/solution would add to their business.
It is important to note here that value delivery doesn’t necessarily always happen at the go-live phase. Your product may require your customers to wait a little longer after going live.
The mantra to keep in mind: Quicker FVD = lesser churn. FVD looks different for every customer because every customer’s needs are different. So how do you figure out what value to deliver for each customer? You build a relationship with them. This will help you understand why they signed up, what business problem they are trying to solve and use it to find out what the FVD for the customer will be. This is especially effective if your product requires the customer to wait for a longer time to see your offering’s value.
Discuss the problem your customer is trying to solve by using your product. You will get to know what value they are looking to derive from it. When using your product, they are looking for ways to get to that value. It is best to take the guesswork out of the product usage for them. Handhold them through the process. This could be in-app tutorials or dedicated training sessions for the implementation team on your customer’s end. For example, just tooltips won’t cut it for an HRMS tool. This will require detailed training sessions, calls, emails, and help documentation.
Have a live chat option within your tool, and make sure you have support personnel available to respond at any time. Make help documentation conspicuous and easy to follow. You could also have email support with a dedicated eye on the inbox. Knowing help and assistance are readily available for them will ease any anxiety the customer may have about using your product. It also conveys to the customer that you care about their experience.
Work with your customer to break the larger value delivery goals into smaller wins, and turn them into milestones. For every milestone you hit with your customer, celebrate. This reinforces what you bring to the table and helps your customer realize value regularly throughout the onboarding phase.
Identify points in your onboarding journey where it makes sense for you to solicit feedback from your customers. This will provide insight into what is going well with your onboarding process and what needs to be improved. Use this information to refine your methodology and make it better for the next customer.
You can define the success and failure of your value delivery game using metrics. Metrics such as time-to-value (TTV), churn, CSAT score, etc., help you identify where you can bring in improvements and what you are doing right in the onboarding process. For example, if you see that most of your customers churn within the first month, you may need to improve your onboarding process to help them with value realization faster than they are currently. Read on to know more about the key metrics you could track that can provide you with crucial insights on improving your onboarding approach.
Time-to-value, TTV for short, is the time it takes between your customer buying your solution/signing up and using the solution beneficially. This is a crucial metric because any delay in getting to the value can add to the chances of a customer dropping off.
Customer Renewal Rate is commonly calculated as the ratio of the number of customers who went in for renewals against the number of customers who canceled. This is a significant indicator of the value your customers see in your offering.
Daily Active Users (DAU) and Monthly Active Users (MAU), as the names suggest, indicate how many people use your product on a given day or a month, respectively. Active engagement with your product suggests that your customers are deriving value on an ongoing basis. Dormant users are more likely to churn.
The quality of customer onboarding is directly linked to churn. Demonstrating quick wins to customers during the onboarding process can go a long way in retaining them for the long run. Some numbers you could look at are the time it takes for the customer to complete tasks, the number of customers who go through the complete onboarding journey, and the correlation between onboarding completion and retention.
In the SaaS world, ‘churn’ is when customers cancel their subscription to a product or decide not to renew their subscription. Churn rate, therefore, is the percentage of your customers who have not renewed their subscription over a given period of time.
We add new features to our product because we believe that they add value to the customer’s business. Tracking this metric will let you know how valuable your customer finds a feature. A simple way to calculate the feature adoption rate is to divide the number of users using a particular feature by the total number of active users or logins for a specific period of time.
The Net Promoter Score (NPS) is a measure of how likely a customer is to recommend your product or service to others. It’s one way of knowing how satisfied the customer is with your offering.
The NPS is obtained by asking the customer a single question such as ‘How likely are you to recommend this product to your peer?’, and asking them to answer by picking a number between 0 and 10, 0 being least likely and 10 being most likely. Usually, the scores are categorized as follows:
0-6 - Detractors
7-8 - Neutral
9-10 - Promoters
You can calculate the NPS for your product by reducing the percentage of detractors from the percentage of promoters.
How do you find out how satisfied your customers are with your product? You ask them, of course! The Customer Satisfaction Score (CSAT) is a good indicator of knowing whether your customer will return for more. It’s a window into how they perceive your product’s value and how much of their expectations your product fulfills. Having a CSAT survey during your onboarding journey can help you understand where your customers need help, where your onboarding team is doing well, and where they need to improve. Rocketlane’s built-in CSAT survey feature helps you collect customer feedback at every stage of your onboarding journey, with just a few clicks.
A lot of businesses consider onboarding as just another check on the list. But the customer onboarding process can be crucial to customer retention. Customers usually churn because they do not understand your product well enough to use it or don’t see it adding value to their business. A lot of churn happens between your customer signing up and realizing value. In fact, you lose 90% of your customers within the first week - they are either rarely active or have churned.
Onboarding is therefore crucial to reducing churn—it is what sets the tone for customer experience and the phase where the customer gains/loses confidence in their decision to choose your product. It is the phase where you familiarize the customer with your product and make sure they learn how to use it for their requirements. This is also a phase where you can help them see the value.
Here are some best practices that can help you improve your onboarding process:
Pando, a freight management SaaS platform, changed their Customer Success & Implementation team’s name to Value Delivery. Nigamanth Srivatsan, Director - Customer Success at Pando, says that helped emphasize what they had to focus on. He also talks about how to set up the Value Delivery team and how they put in place processes to get newer team members up to speed quickly and with minimal intervention from their seniors. More importantly, he reveals how Pando onboarded 20 enterprise clients in two years. Read all about it here.
Innovaccer is a healthcare data activation platform, and their implementation takes anywhere between six to nine months. To help customers realize value at the earliest, their Customer Engineering & Analytics team developed a value delivery framework where every customer is mapped to a ‘value level’ based on their business model or the problems they are trying to solve using Innovaccer’s product. The main objective is to ensure continuous and incremental value delivery so that the customer does not have to wait for nine months to start seeing value. Ashish Singh, Head of Customer Engineering & Analytics at Innovaccer, talks about Innovaccer’s data-focused approach to implementation, building transparency into their culture code, and more. Check out the post here.
We told you that the onboarding phase could directly affect your churn rate. Well, now we have a case study in it. Jharna Moorpana, Ex-Onboarding Manager at WebEngage, talks about how the B2C marketing automation platform turned their churn crisis around by forming a dedicated team for onboarding and making crucial changes to their onboarding process. Jharna also recommends best practices for hand-offs. Read more here.
Wondering how to identify quick wins to get to value delivery? In Episode 06 of The Launch Station, our podcast, Irit Eizips, CEO, CSM Practice, walks us through her first value delivery framework and how to use it to shorten time-to-first-value. She also recommends best practices for ROI, value delivery, and CSM teams. Tune in for this and more here.
Gone are the days when sales meant selling your product or service. If you are a software vendor, especially in the SaaS space, you need to demonstrate to your prospective customer the value your tool can add to their business. You are not just talking about the tangible product and its many features, but also the value - which is subjective and heavily dependent on the customer’s needs and expectations.
Value selling, therefore, is when you pitch how your product will make your customer’s life easier and meet their needs, rather than just talk about how the product and its features work.
For the value selling approach to succeed, you need a sales team that is equipped for it (duh!). Value selling entails helping your customer perceive its benefits and how it adds up in relation to the pricing—the customer needs to feel like the pricing is justified by the value they can derive from your product. So how do you help your sales team to succeed in this quest? Here are three ways:
This would be a business that stands to benefit from using your product. This is the customer you’d want. A good starting point would be defining what value you will provide them and the value they will bring to your business. Providing an ideal customer profile (ICP) to your sales team will help them align with your goals and work with a common objective in mind.
The best way to identify what value means to your customer is to ask them. Working with them to understand their pain points and aligning your solution with solving those problems will help your customers see the value. Make it a part of your sales methodology to work with each customer, identify their needs, and agree on outcomes. Ensure the customer onboarding team is brought up to speed, so the expectations are set and straightforward for both your and the customer’s teams for the onboarding phase.
Share with your team comprehensive documents or presentations on your product’s features and the many ways they can benefit your customers. Provide case studies, use cases, documented success stories. This will help the team refine their sales pitches and serve as a ready reference when they need it.
Value realization is the customer’s aha moment. That is, the customer starts experiencing the value they were promised. This happens when the expectations set for them at the beginning of onboarding are met.
While this is not a definite list, the following metrics are significant indicators to track if you want to measure value realization:
Here are some best practices that you can adopt to increase your customers’ value realization prospects: