The customer success playbook for when the economy goes south
Between inflation, a Fed rate hike, and a topsy-turvy stock market, the economy is gettin’ real. Tech companies are reacting, with some cutting jobs, others putting jobs on hold, and yet others looking hard at their “cut line” for funded projects.
And you, as a customer success leader, are on the hook to deal with all of it! No presshah!
Fear not! You and your team have all the skills and capabilities to suss out at-risk customers, engage them in the right conversations, and help them through this ugly economic period — all while keeping your company above the “cut line.” Here’s your five-step playbook.
1. Make a plan
Make a plan for how you’re going to suss out and engage at-risk customers. Start by understanding your own team’s capacity, as well as thinking about where you spend time addressing customer issues. Tee up conversations with your team, peers, and executives so they’re prepared for changes you may need to make.
Besides this analysis, draw up a plan for engaging your at-risk customers. It should include your goals, stakeholders, meeting cadence, and key performance indicators for success. Write a one-page project brief that lays it all out clearly.
2. Suss out at-risk customers
Know which customers are at risk of churning. Look beyond your standard health metrics to get a sense for how much the economic downturn is affecting them. For many companies (who look at satisfaction and usage metrics), that means layering in financial health indicators like stock valuation, announced layoffs, and business transactions, such as M&A or new private equity investments. Here are a few metrics to include.
If you don’t already calculate a customer health score, consider doing one now so you can prioritize where you spend your time. While satisfaction is a great indicator, it doesn’t always show you the whole picture. Plotting financial health vs. product usage can help you prioritize which customers may be worth engaging, and in what order.
3. Engage customers
Engage your customers in priority order. Create a small tiger team for each of your at-risk accounts, including the Customer Success Manager, Account Executive, and an executive sponsor. Keep key product, engineering, or marketing folks in the loop, and pull them into customer conversations when needed. Before you reach out, take a moment to look at each at-risk customer’s latest CSAT and NPS scores, Customer Support call outcomes, and status of feature requests. Know their latest usage statistics and any changes to their technology stack or organization. Look at gaps in usage, such as unused features, uncovered use cases, un-integrated technologies, and relevant users yet to be onboarded.
Here are some questions to ask, and what to listen for in the responses.
If you want to get your team skilled at conversations like these, try Ox, the AI conversation coach. They’ve built a fantastic set of practice modules and a credential around this topic. (In full disclosure, I’m an advisor to Ox, but I was a fan first.)
4. Orient your efforts
Orient your efforts to your customers’ urgent needs. Think beyond just your team and consider what others — product management, marketing, engineering, and executives — can do to make your customers successful. Here are a few ideas.
Product
Marketing
Customer Success
5. Measure and assess progress
Measure and assess your progress. Keep your team, executives, and board in the loop in a constant cadence. Report on main KPIs at team and board meetings. Track renewals and bookings closely against your hypotheses and activities to understand the efficacy of your plan, and where to course correct. And feed these findings back into your planning process — to inform your financial planning, go-to-market strategy, pricing and discounting, hiring, program spending, purchasing, and more.
It’s never too early to have a game plan during economic downturns. Rally the troops, analyze customer risk, engage at-risk customers, and adjust your business practices as needed. Then, report and refine for next time.
Special thanks to Kristen Alexander and Josh Clawson from Ox and Matt Cavanaugh, Adam Davenport, and Monty Fowler from Kentik, for their contributions to this playbook.
