What is Customer Marketing?

Posted by: Nick Venturella

Recently I was on LinkedIn and a newly minted connection asked about my professional pursuits. I described that I'm a customer marketer among other things, and she asked what I meant by "customer marketer."

This isn't the first time I've been asked this question, and it makes sense that it's coming up more now (as the COVID-19 pandemic is still going) and companies are looking to double down on their current customer base to retain them and their associated revenue.

Customer Marketing is a specific discipline within marketing. It really grew out of B2B software organizations. Think of subscription software (SaaS offerings) where customers subscribe to use a software application, but because it's subscription based, and the fact that there are competing software products providing similar services/outcomes, customers can leave at any time fairly easily, and with less financial repercussions than in the past.

In the past, it was harder for customers of a software product to move on after making a hefty upfront investment in the software solution, and they owned it, and needed to maintain it - a very expensive arrangement for the customer.

Now the software organization owns the burden of the software solution's backend infrastructure and maintenance, which is why it's less expensive to "own" for a customer, or rather rent for a monthly subscription fee.

Today, the customer isn't so heavily invested, at least not financially, in the software product like they were in the past when they had to buy and own it outright. This is helpful news for customers, but it means that the burden to retain customers using the software falls to the solution provider because the choice to switch software solution providers is no longer purely financial.

In other words, the customer can more cheaply leave one software subscription for another and potentially still have spent less money than what it would have cost to buy and implement the software like in past models. The customer is no longer bound to keep using an outdated solution simply because it's not cost-effective to switch and buy another.

This caused a problem for Software-as-a-Service (SaaS) providers. Enter: churn.

Churn is when a customer leaves and their subscription revenue is lost by the software provider because of their departure. A SaaS based solution provider thrives on predictable recurring revenue, which means it needs to know how many subscribers they have, what they're currently paying per month, and, if the organization is successful in keeping those customers next month, the software company's month-over-month revenue should be X.

That little bit, "if the organization is successful in keeping those customers next month," is where both the Customer Success and Customer Marketing disciplines in software organizations came from.

Software companies are full of innovative, smart people, so they decided to solve for this issue. Enter: Customer Success.

Customer Success Managers (CSMs) became this post-sale hybrid of customer service reps, product coaches, marketers, and inside sales reps for a small group of customers in a CSM's book of business. The idea is that the CSM would build a trusting relationship with the software customer and help that customer become successful adopting and using the software as intended for their organization.

That bit, "help that customer become successful," is where Customer Marketing launched forth.

Customer Marketing as a whole benefits an entire software organization from Customer Success, Support, and Product departments, to Marketing and Sales.

To keep customers from churning Customer Success is trying to help their customers accelerate their adoption of and success with their software solution - reduce time to value. The faster customers realize value and validate their reason for purchasing this software the more trust is built between the customer and the software solution provider, and the likelier it is that the customer won't churn.

Customer Marketing takes this a step further by building processes and practices to provide air-cover (constant engagement and touchpoints for the customer to aid their individual growth and acceleration with the products and with their peers and counterparts who are also using the product).

This creates consistent valuable engagement between customers and software providers aiding the acceleration of trust between the two parties. This is also where communities form around a software brand/product and its customers - the software and the outcomes it provides is a shared purpose/pursuit for customers (and the software provider for that matter). Customer Marketing works to cultivate that trust with customers over time by providing added value related to and around the software through ongoing engaging activities and interactive communications.

Those ongoing engaging activities and interactive communications provide customers with:

• education on various use cases for the product that may or may not be obvious
• opportunities to network with customer peers from other organizations also using the software (organic community growth happens here as customers share questions and answers and sharpen their individual skills - this accelerates success with the product and individuals' confidence, which builds trust within the customer community collectively and with the software provider/brand).
• opportunities to share product feedback. This is important because a software product is for it's customers therefore the customers should have input into, and ownership over, the future of the product so it meets their evolving demands, and doing so will help software companies minimize churn.
• recognition of customers' successes. As a software organization, being able to recognize the victories of your customers on an individual level gets to the heart of humanity - you're engaging people, humans. Individual recognition builds trust and endearment and helps customers know that you see them, see their hard work, and their resulting success. This kind of individual recognition is a sacred and intimate place to be with customers. Never squander it.

All those elements of ongoing engagement and interactive communications over time lead to successful customers who trust in their software provider because they're engaged as humans, individuals bound by a shared software solution, and that trust eventually turns into advocacy - customers' advocacy for a software solution and brand.

A customer's advocacy at that level is invaluable because now the Customer Marketer can present opportunities for that customer advocate to further their own thought leadership on a topic they're now already passionate about so they want to share their success story with others to evangelize the software and the brand.

At this point, the software company has not only helped to solve its churn issue, it's now fostered an avenue to capture voice-of-the-customer progress and success stories via its advocates. Customer Marketing can leverage those advocates to co-create customer story video assets, case studies, user groups, product councils, mentoring programs, provide reference customers to prospects considering purchasing the software, etc...

All things that not only put customers center stage to recognize their hard work and successes with the software product, but also to have a positive network effect across the software organization's whole operation with a focus on the customer. Such a focus will help to increase customer retention, growth, and revenue.

Here are some examples of that network effect across a software company's operations:

• Support - because customers are asking and answering questions among themselves about the software, they're reducing the burden on the Support team to answer those questions
• Product - with strong customer relationships a software company has an avenue to get regular product feedback from their most important constituent, their product user. This helps to know what should be on the development roadmap to continue to maintain current customers and attract new ones.
• Customer Success - Customer Success Managers (CSMs) are trying to build deeper relationships with those customers in their book of business. As a result they can't deeply connect with as many members of one customer organization as they would like. A Customer Marketing program can help scale regular, valuable touchpoints for CSMs to fill those gaps and engage more individuals within each of the customers on their roster. This also comes in handy to help maintain higher levels of engagement between the customers' employees and the software provider. That trust and engagement may be the difference in a renewal and/or a cross-sell/up-sell. Plus, as customers commune together to answer one another's questions and share their experiences they learn about new/different software features that they may not yet be utilizing.
• Marketing - maintain the ongoing, engagement and communications to cultivate customer advocates while also leveraging passionate advocates' interest and willingness to share their story and experience in marketing assets and with prospects. Their voice-of-the-customer credibility in the marketplace provides the best word-of-mouth marketing on the planet for Sales to leverage.
• Sales - when Sales has an ongoing, ever-growing pool of passionate advocates who are willing to be references for prospects, it can help bring more new deals over the finish line, faster.

Customer Marketing is a simple concept, but it is complex to implement and execute well so that a real and transparent, trusted partnership between a brand and its customers can form.

The idea of Customer Marketing is to build trust in a customer-centric way. It's a deliberate focus on partnering with one's customers to co-create value with, and for, one another. This builds longer term relationships with customers, which accelerates customers' adoption and success with the product, which increases renewal rates (reducing churn), provides peer-to-peer customer networking and support, leads to easier up-sells/cross-sells and overall an extended/increased life-time value of customers...

Ultimately, it's cultivating the desire for a customer and their software partner to want to support each other's success.

However, a software organization cannot reach the kind of Customer Marketing state described above without getting their own house in order. To do that they need to partner with their employees to create a positive, trusting, and humane environment that cannot help but engage its employees to want to band together and create a brand-differentiating company culture.

When that's in place, executing Customer Marketing is way easier because employees truly want the company to be successful and partner meaningfully with customers. But that's a post for another time.