Regardless of context, have your customer’s attention in the first contact with your company is something essential considering all the effort of education and sale you may have had for him to get there. It is a unique opportunity to impress you, and as we talked about before here on the blog, onboarding , or oriented implementation, can help a lot in this process!
Besides being a first impression of your company, is a way to guide a new customer in the use of your product or service, create proximity to the company, move out the way possible barriers to achieve some initial results, or first value, and drive customer to success.
Because of all these advantages, today we will talk about three key results that your company may have to do a good onboarding with their customers.
We talked about the blog on churn and the activation key point of an oriented implementation (onboarding) . But what is the relationship between these two metrics ?
Go to a practical example: if, for example, 7 of every 100 customers of your company cancel your product every month, it is that the churn rate for your product will be 7%.
What does it mean if I see that 3 of those 7 customers who have canceled had become my clients within one month ago and the other two were still in the first 6 months?
In this case the 7% churn do not help us much to find the problem. It is important to analyze other data, as in the example chart below, which considers the date from activation – when you identify that it has reached the first expected result. And in this new scenario, this figure of 7% becomes an even bigger problem.
This company is having problems with loss of customers especially in the first 6 months of a customer’s account. Later, things are settling for a reasonable rate of 4%.
In this case, we have a problem on the client activation process, the main indicator of their onboarding and consequently one of the most important steps of the project. So it is important to work at this point, as his client started using your product or service but never fully “on” and ready to succeed.
Activation does not mean that the customer purchased / subscribed and paid, but it took an action or set of actions that indicate that he understood the significant value that your product / service offers and reached the first value.
As it was not fully activated, the customer ends up not making the best use or taking advantage of the full potential of what you have to offer and can be dissatisfied, leaving your company.
For her long-term customers end up being those who are successfully using your product or service and will hardly leave you in the first months. And the onboarding helps a lot in the process, thereby reducing its churn.
Lifetime Value (LTV) is, in brief, the average of how much each customer will spend with you throughout his life, from the first day you buy your product until the day he stops using it.
So to increase the lifetime value is important to find ways to extend their customer relationship to and / or increase the amount spent with your company, either through products or services.
The onboarding is very important in this process because even though only an initial piece of the life of a client, the focus of most of your time is the activation.
Improvements in onboarding has the greatest effect on customer retention for many reasons. The main reason is that once a customer has a first impression and form an opinion about a product / service becomes much more difficult to change that opinion. So extend the stay by the client and / or increase the amount spent on your company will be very difficult.
So if they have had a good experience in onboarding and activation process, you will have to work much harder to get to keep them as long-term customer and increase the LTV compared to those who had a good initial experience.
What customers are in trouble? How do I know what to avoid that they cancel? What are the best segments of my base? Where my focus resources and efforts? If you’ve ever wondered about it, the health score can help you.
The “client’s health”, or health score is a metric of the health of the customer base of your company. Some companies create and continuously monitor this metric to help find where the opportunities and risks at its base and provide retention processes and new sales.
Something very positive onboarding is to use the initial energy customer purchase to make it engaging. Congratulations if you did your customers go through the successful onboarding! A well done onboarding, customer actually “activated” will facilitate the improvement of its health score and maintaining it for a longer time.
But this is just the tip of the iceberg. Have you managed to pass the first steps, but now you have to start working to sustain a long-term relationship and make your customers continue to have success.
So after the onboarding your focus shifts to optimize the health of their customers. For this to happen, you should consider whether the onboarding was effective, understand its customer needs and assess whether they are realizing the maximum benefit from available resources. And depending on the segment and the importance of customers, Reviews Quarterly can help you in maintaining it.
The onboarding is a very important and critical process in the client’s life with your company and deserves due attention and investment.
Engaged a new customer, who knows to use your product or service and has achieved some initial results, it will take much more value you have to offer. With short, medium and long-term results both in decreasing churn, as increasing the lifetime value and improve the health score of your company.
However, never forget that the market and people are constantly changing and improvements in their onboarding are essential for the maintenance and greater effect on customer retention.
In this post we show three key results that are connected to the business of your company, but certainly there are many other outcomes associated with onboarding.
And in your opinion, what other results were missing?