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The Customer Success Experiment: How Focusing on Long-Term Value Solved Our Retention Problem

I have always been a calculated risk-taker.

There is something really satisfying about creating some space around a problem and observing it carefully. I love problems, which I reframe as “opportunities for iteration.” They fascinate me, have triggered some of my best work, and anyone on my team will tell you that I do not shy away from confronting areas of weakness and curating solutions.

When Nutshell’s last Customer Success effort fizzled out (more on that in a bit), I was fairly new to the CX team at Nutshell. I still had a lot to learn about the nuances of the product, but it was quickly becoming clear to me that Nutshell could wildly revolutionize the way scaling businesses do their work more effectively.

Coming from a sales management and real estate background, I understood our customers’ hustle. I also empathized with new Nutshell customers who knew they needed a CRM, but just didn’t have the time to implement it in the face of the many challenges of a scaling business. When new customers did knock on our Support team’s door, they didn’t always know what they needed, and all too frequently abandoned ship.

The problem that inspired my next steps was that renewals between 10 months and one year were dropping below 100% MRR retention. In other words, the customers we worked so hard (and opened our wallets) to obtain through marketing and sales efforts were beginning to cancel one year after their signup date. Even worse, we were losing over half of new customers at 12 months. My hypothesis was that providing a proactive onboarding experience would reduce the churn rate after 10 months, and every month in between.

I came up with a way to define my goal for this experiment. It’s still scribbled on a sticky note on my monitor to help ground me. This goal drives every conversation I have with the incredible professionals I have the opportunity to learn from and work with: “Is the customer happier? Are they more successful?”

I like to think that if you want to know the future, you should look at the past. Understanding the efforts Nutshell had already made to launch a Customer Success initiative was critically important in ensuring I did not repeat any past missteps.

The wrong approach to onboarding

What were those missteps? Nutshell tried copying the process of big box CRMs. Service packages were sold based on the number of hours our Customer Success Manager would have to devote to the onboarding. These were inexpensive, one-time purchases that shifted responsibility for product adoption fully to the CSM.

Customer Success was treated as an all-purpose response for a variety of negative customer impacts like missed sales expectations, a bad product fit, or was used to compensate for poor support experiences. We measured onboarding in units of time, whether or not actual value was delivered.

The truth is, Nutshell doesn’t sell boxes. Nutshell sells subscriptions. Without a Customer Success process at Nutshell, there was a level of care missing from the Support team’s workflow.

Diagnosing the problem

Starting in June of 2018, I began scheduling a few hours a week for myself to connect 1:1 with new signups, and I listened. What I learned was that not all customers were seeking the same kind of value, and that I needed to hone my listening skills so that I could deliver the specific results they were looking for.

What this listen-and-learn approach allowed me to do was curate an onboarding plan which was customer-driven. I removed the minutiae of our previous onboarding process, which enabled each customer to obtain the unique value they needed from a CRM. Basically, I removed the red tape, I slowed down, I listened, and I religiously logged the data I gathered about these powerful customer engagement touchpoints.

(For an update on the success of Kristen’s efforts since this article was originally published, watch her Q&A for BOUNDLESS 2020: “How to Build a Customer Success Pipeline That Drives Revenue”)

After ten months of phone calls, screen shares, and in-person handshake visits, the emerging trend was that our customer’s needs could be simplified into five categories: data migration, pipeline customization, team structure, integrations, and product training.

Having this information in-hand already felt like a massive win. I had not only identified the problem my organization was facing, but had the building blocks to curate a solution for our customers. I like to practice what I preach, so I built this process into Nutshell as my very own Customer Success pipeline.

Inside the CS pipeline

The Customer Success pipeline I created was divided into seven stages…

Outreach: A customer signs up and begins receiving a Nutshell email sequence. The most common objections our very busy customers have at this point are “I don’t have the time” and “I don’t know what I need,” so I keep that top of mind in my initial outreach. Nutshell’s email templates allow us to report on their success, so I was able to do some great A/B testing until I found some language that felt true to me, our brand, and was well-received by my client.

Interested: The customer raises their hand to let us know they are interested in getting some help, then books some time with me to discuss the future of their account. This call or screenshare takes place between myself and the Nutshell admin, as well as other important executive team members within that organization.

Planning: The customer receives a warm connect, and I ask what I can prepare for them prior to our call to make sure value is delivered.

Meeting: We discuss the five trending pillars for long-term health: data migration, pipeline customization, team training, integrations, and team structure. I deliver a customized action plan for their organization based on their unique timeline.

Follow-up: Actionable next steps are delivered to the customer which are concise, uncomplicated, and value-driven.

Nurture: The ball is not in my court, but new teams benefit from frequent check-ins to ensure Nutshell is helping them meet all of their organization’s deadlines. I take anything I can off their plate, I recommend third-party tools if necessary, I problem solve, and I get creative.

Funnel towards support channels: Communication will generally become less frequent after onboarding, but the relationship is never truly over. Here, I make sure teams are fully armed with the tools they need when software breaks (it happens anywhere) or changes occur within their organization.

The payoff

To share some early results, the customers who graduate from this pipeline boast higher product adoption rates and increase their spend more than the cohort of customers I have not worked with. Customer churn rate is also very low among this cohort, at 2.5% compared to the non-CS cohort at 3.91%.

This chart represents the average revenue per account, and compares my cohort of customers to other customers within the same guidelines (three or more seats, signed up on or after June 2018).

I am a calculated risk taker, and I have the awesome privilege of helping scaling business owners move the needle using Nutshell’s amazing CRM solution. Our product team, growth team, designers, and engineers are all rooting for our customers’ success (thanks to Nutshell’s very cool Slack integration) each time a client expands, and that is what we call a win-win-win.


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