Driving Customer Lifetime Value with Actionable Data


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The customer is always right. Your software company probably does – and certainly should – side with most customers, even if they are wrong.

When customers voice displeasure, you usually have a good idea why they’re right or wrong. But most customers don’t complain. If they’re unhappy with your product, odds are they’ll look elsewhere when shopping for new software. Even if they’re pleased with your product, they also usually don’t offer much feedback and instead will quietly continue buying software.

To build a solid customer base, you need to know what the satisfied and dissatisfied think long before they make buying decisions. To learn what they’re thinking, you need to bring out the best in them. How do you do that? As MIT Research fellow Michael Schrage urges in his book, “What Do You Want Your Customer to Become,” companies need to reconsider how they calculate customer lifetime value. Viewing it from the perspective of companies, Schrage writes that when customers are treated as value-creating partners, they “give us good ideas, they evangelize for us on social media, they reduce our costs, they collaborate with us, they try our new products, they introduce us to their customers, and they share their data with us.”

Increasing customer lifetime value can seem challenging, but by following three not-so-difficult steps, you’ll engender deeper relationships and accurately measure satisfaction and dissatisfaction.

Understand What They’re Doing
Your software is probably helping drive many of the initiatives that create long-term value for your customers’ customers. So how do you ensure that you are a committed partner on their innovation journeys and helping them innovate and create winning products and services?

Software usage analytics offers a unique window into how customers use your product. It allows you to serve as a true partner but in a non-disruptive manner. The insight gleaned from software usage lets you continuously and quickly create useful features and fix frustrating ones. Relying on the insight of a small handful of willing partners or user surveys won’t provide the objective, encompassing insight that is needed and can be gathered through usage analytics.

Stay in Touch with Useful Information
Stay on the forefront of your customers’ minds by crafting social media posts that offer bite-sized tips or lead to larger content and by writing educational blog posts with a regular cadence, giving customers instructive information that they’ll look forward to. The challenge for most companies is finding the pain points and topics that resonate most with customers.

Data and insights into customer use of your products enable you to identify and prioritize topics that matter most to customers. By seeing which features are used most often, you can create content that ensures customers are maximizing the benefits of those features. Conversely, by seeing which features are used the least, you can educate your customers about valuable features they haven’t discovered yet (and update your product to make those features easier to find).

Treat Customer Data with Care
B2C and B2B customers want to know how their data is being used. Security and privacy should be a top goal of your company. With GDPR and other data privacy and protection regulations tightly governing the use of customer information, software vendors need to assume full responsibility for how they manage and store information.

With proper clarity of the data ownership chain, software companies can attest to the provenance of data. They will understand what data they have and how long they have possessed it. This insight informs all data management processes and sharpens a company’s ability to follow regulations.

Gaining complete insight on how customers use your software, regularly providing useful information, and properly managing customer data will help customers be their best. They’ll recognize they have a relationship worth keeping – a commitment that has lifetime value.

Keith Fenech
Keith is Revulytics’ VP, Software Analytics and was the co-founder and CEO of Trackerbird Software Analytics before the company was acquired by Revulytics in 2016. Following the acquisition, Keith joined the Revulytics team and is now responsible for the strategic direction and growth of the Usage Analytics business within the company. Prior to founding Trackerbird, Keith held senior product roles at GFI Software where he was responsible for the product roadmap and revenue growth for various security products in the company's portfolio.


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