6 min to read
What is customer onboarding? How could it improve LTV and reduce churn?
Customer onboarding is the process of nurturing your new users and customers to make them feel comfortable using your product and make it a viable part of their life. It is vital to make your customers feel acquainted with your product with step-by-step tutorials, unlimited guidance and support, and milestone celebrations to bring a smile and a feeling of joy and achievement in the minds of your people while using your product.
Most customers in the early stage face complexity while switching from another product to yours or confuse with the UI/UX. The sense of dissatisfaction in people's minds triggers a feeling of despair, which compels them to look out for alternatives or cancel the free trial/subscription. As it is said in the start-up world, the churn rate is cancer for start-ups. In simpler terms, the churn rate is the annual rate at which customers cancel or don't renew the subscription and stop doing business with the company over a given period. It reduces the lifetime value and increases the cost per acquisition, leading to an ultimate decrease in profit for the brand.
Most of the revenue for a company indeed comes from existing and loyal customers. It is way easier to nurture the existing customer and make them renew the purchase than acquiring a new customer and encouraging them to earn loyalty.
Why is customer onboarding so vital for the growth of your business?
Customer Onboarding- Benefits
If a customer is satisfied with your software product and has achieved their goal or let’s say that the product solved their pain points, then it is a no-brainer that they would return and resubscribe. On the other hand, let's assume your product was perfect, and it had all the caliber to help customers succeed. However, due to a lack of proper guidance and support such as videos, documentation, tutorials, and customer service, the customers failed to realize how potent your product was, which ultimately led them to cancel the subscription, look for alternatives, and go to your competitors. AI chatbots could help.
This paragraph sums up the importance of customer onboarding. Here are the other three main reasons why customer onboarding is so important for the success of your business:
word of mouth marketing
Word of mouth marketing is a part of earned media. It usually happens when satisfied customers talk to their peers and network on how awesome your product is and how it could help solve most of the problems. The customer onboarding process allows you to teach your customers about your product and directly converse your value and marketing message. A proper customer onboarding process also enhances authoritativeness which makes customers stay longer with you.
Social media strategy (for example Pinterest marketing) could also help you in customer acquisition as social media is a cost-effective way of reaching a large portion of your target audience. The top CRM tools in the market could also help you segment your customers based on their behavior. Hence, you could shoot a targeted email to customer segments and leverage the most out of your emails.
Shorten TTV(Time To Value)
Decreasing Time To Value inCustomer-Onboarding is crucial
Time to value is a metric used by companies to measure how long it takes for a new customer to realize the value of your product. Failure in TTV means losing customers faster. The customers must realize the benefit they expect from your product and not what you want to deliver. All the optimization must be done with the customer's perspective and solving their pain points. As we have learnt from Amazon, customer obsession is the key to success in this competitive digital atmosphere. Communicate with your customers on email as email marketing is one of the most important digital marketing channels with the highest return on investment,
Recurring revenue and decrease in churn
Recurring revenue defines success
In the start-up world, recurring revenue is one of the most important forms of traction as it helps to make the company more stable and protect its operations and finances. Keeping track of your MRR or monthly recurring revenue enables you to analyze your baseline to measure your business growth and success.
On the other hand, if the churn rate is higher, then the cost of acquisition of customers eats away the fundamental revenue and works against financial growth. Hence, it is always recommended to keep it lower by either increasing effectiveness in marketing or increasing the lifetime value of a customer.
Important tricks to make customer onboarding a smooth process
1. Define the desired outcome and set milestones
Focus on customer's success
In this new era, when companies have the ultimate focus to help customers get success or their ultimate goal, it becomes crucial for you to know how "your customer" defines success. You could ask multiple questions in the first few days and weeks of engagement with your customers to refine your data and achieve your product's goal. That's the purpose, after all.
The customers generally go through several steps before making a final purchase. They must have come across your digital marketing campaigns, specifically your content marketing approaches that have given them some idea of how your product could be their problem solver. That is the "Eureka signal" for you.
The next step could be to set milestones and make a plan to make them happen. You could set goal deadlines to make the same process completed in a short time to shorten the time to value metric. You should try to fix the milestones accurately every time, and it could only happen if you were real and honest with the milestones.
2. Focus on customizing the onboarding process to improve the experience
The first few days of your onboarding process sell. In our case, some of the B2B marketing tools had a poor onboarding process which ultimately led us to look for alternatives in the market. One of these alternatives had a personalized onboarding approach with a dedicated sales rep that earned our trust, and we have been using the product for three months.
If you are in a B2B marketing niche, you could dedicate exclusive sales representatives for your new customers who would help enhance the onboarding process with a personalized approach. Along with this, you could also look for UX design principles to make things visually appealing for your customer persona. You must also continuously communicate with your audience and ask them for quality checks and how is the onboarding process going for them. It would be best if you were open to questions and suggestions to improve your product and process.
3 Your customers must have the flexibility to import data, integrate with other tools and invite team members
In the B2B arena, the onboarding process is more than simply knowing how to use the product. As several steps are going on at a time in a company and several employees involved, it is generally recommended to have options where your customers could easily import the data, integrate your tool with other tools to automate and improve the workflow and invite other members to work together on a project.
At the same time, the requirements of each of your customers would vary. It means you should keep all the aforesaid add-ons optional. If your customer needs them to be a part of the onboarding process, you should introduce them to improve the overall user experience. You must have a dedicated sales and customer service team to provide plenty of support to your B2B clients. Your customers must find it easy to contact your support whenever they need it and make it a part of their daily workflow.
4. Have a knowledge base section and regularly check in to see your customers progress or problems
knowledge base section
A frequently asked questions section on your website is crucial to solving your audience's problems on a generalized level quickly and autonomously. An AI-powered chatbot could also be a great option to add a personalized touch and solve user problems.
Content marketing is crucial to earn customers and help them know more about your product and improve the customer onboarding process. Suppose you continuously check-in to see whether your customers are stuck in a problem. It increases the feeling of being valued, which helps retain the customers and improve customer loyalty. CodeDesign could help you with content marketing and SEO approaches. Have a look at digital marketing vs traditional marketing.
5 Support and congratulate your customers when they reach a milestone
In the first step, we talked about setting milestones that could help achieve a goal in a time frame. And, now is the time to celebrate your customer's journey. Everybody likes appreciation, and when you show that you value your customers, you earn loyalty and retention. You could send a congratulatory email, a quick call from your sales representative, or an in-app notification to excite your customers to be one step closer to their goals. Thank you letters, product feedback surveys, up-selling emails, etc., are other ways to increase brand awareness and gain the audience's trust.
Customer onboarding is a complex process. However, if you keep the customers at the Centre and create your goals to solve their problems and be obsessed with their problems, you get to earn loyalty. You must understand your customers and set clear expectations. If you show value, you have a good chance to retain your customers. You must stay in constant communication and create customer-centric goals. Here is how you could optimize customer journey for your business.
The customer onboarding process is one of the most important stages of the customer life cycle as it sets the tone for the whole relationship. It is the process new users go through to get set up and start using your product. If the customer onboarding is done properly, it demonstrates the value of your product which sets your customers up for success and increases retention. Read this complete guide on voice search optimization to optimize your website.
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