A question that any businessperson is going to ask after closing that first sale is: How can I keep that customer now that I have them?
The answers to that question add up to account management. It is the set of activities needed to keep your customers once you have sold them.
3. A question that any businessperson is going to ask after closing that first sale is:
How can I keep that customer
now that I have them?
4. The answers to that
question add up to
account management.
It is the set of activities needed to keep your customers
once you have sold them. You want to retain them with
your brand, keep them coming back to your store, have
them buy different products from your product line.
5. There have always existed
the sound principles for
account management:
● Establish a strong relationship
● Build trust
● Provide great service
Such principles still hold very true and must never be
violated. The data we're going to cover here is simply in
addition to such principles.
6. Software as a Service
In the same way as the last chapter, I want to stick with
the industry which I am in, along with many of my
prospects and customers: Software as a Service (SaaS).
In SaaS, account management means keeping your
customers subscribed.
7. Metrics are Key
In SaaS, customer retention begins with a full set of metrics designed
to allow you to track your customers, predict any changes and, most importantly,
predict your revenue.
8. Metrics are Key
To start with, you need to know:
● the number of your current customers
● how many licenses each of them have
● your churn rate—the percentage of your customers
that you lose
● Monthly Recurring Revenue (MRR), which is the
regular revenue coming in from your subscriptions.
Other metrics might be average sales price, and
average total sale.
9. Metrics are Key
You need as many indicators as it will take to show you
the whole picture, and allow you to know as soon as
possible when any changes, positive or negative, take
place in your customer base so action can be taken.
We employ close to 50 metrics for this purpose.
10. Customer Success Manager
Today at my company, as well as with a growing number of others,
account management is handed by the Customer Success Manager.
The total job of the Customer Success Manager is, as the name implies, to keep
customers happy and succeeding with our product.
11. Customer Success Manager
The main guide for the Customer Success Manager is
this set of account management metrics.
The Customer Success Manager uses these to be alert
to any customer that is a risk factor. The risk factor is,
of course, the customer not renewing.
12. Quick Ratio
There is a ratio used by investors to evaluate SaaS companies, that a company can
use themselves to get a fast look at how they are doing.
It is called, appropriately enough, the Quick Ratio.
Here it is:
New MRR + Upsells
Cancelled MRR + Contractions
Quick Ratio =
13. Quick Ratio
The way this figure is analyzed by investors is that they
utilize a benchmark of 4. If a company averages 4x as
much added MRR as lost MRR, that company is
strongly considered for investment. The higher the
number, the better.
14. More Important Than Ever
However you do it, remember that effective account
management is more important than ever in today's
networked society. A happy customer spreads the word
far and wide, and can be viewed the world over through
the internet.
So make sure you make great account management a
top priority!
15. NEXT SLIDESHARE IN THIS SERIES:
For the Future, Sales Management
Requires Virtues