Loyal to Brands or Experience Seekers?

Why do customers buy your products and services? Are they loyal to your brand, or is it a specific experience that drives their behaviour? Thousands of lines have been written about generational differences (Gen Z, Millennials, Gen X, etc.) and their impact on company engagement tactics. However, a similar shift is happening in the B2B space. Influenced by the individuals running purchase activities, the focus is pivoting from product to experience.

After the first industrial revolution, companies aimed to introduce machines to scale production capabilities, focusing on industrialisation, standardisation, and placing the product at the center. Decades ago, branding became central to corporate strategy, ensuring that your brand was top of mind for buyers. Recently, there's been a trend where experience is the main driver. Customers are looking for an experience, marking a significant shift. For additional material, see the SurveyMonkey analysis and the HBR article.

The complexity of this change comes from the orchestration of different elements. It’s not just about the quality or features of your product, or brand recognition. Customers expect more than dealing with a product/service vendor; they seek a partnership. B2B and D2C companies are changing the way they operate. BMW motorbikes are more than just products; they represent a club. Customers meet for motorbike trips and share their experiences and tips in an online community. Similarly, Rapha, the Anglo-American cycling company, has over 200,000 members and organises more than 1,000 rides per month globally. They started selling cycling apparel and soon embraced the experience-led strategy.

B2B companies experience this shift as well. Consulting firms and marketing agencies have always had account directors with sales, growth, and expansion responsibilities. Expanding your footprint within existing customers is cheaper and more efficient than acquiring new ones. Although significant growth comes from new logos, SaaS companies understand the importance of retention. Salesforce, a SaaS pioneer, operates on a subscription model where revenue comes from selling services, ensuring customer satisfaction, renewing contracts, and expanding the solutions portfolio. This requires a new skill set in the go-to-market team. Salesforce created the Customer Success team (initialled called Customers for life) to act as customer partners with consultative, commercial, and technical mindsets, driving goals such as reducing attrition, increasing ARR, and enhancing CSAT/NPS.?

To be effective, these efforts must align 100% with pre-sales engagements. This involves not just the sales team, who maintain commercial responsibilities throughout the customer lifecycle, but also solution engineers and presales resources. Their engagement is critical for positioning solutions, presenting products, running demos, and preparing capabilities mappings and ROI exercises based on new capabilities to deploy. Setting correct expectations is crucial; if expectations are misaligned, it becomes difficult for the post-sales team to ensure customer success. Solution engineers and customer success managers are pivotal in the SaaS go-to-market environment, requiring close collaboration and alignment. Therefore, the solution engineer role, like the CSM (customer success manager), is a commercially minded, technical, and consultative resource that should be measured not only on a quarterly basis but with a long-term perspective focused on ARR (annual recurring revenue).

The SaaS business model revolves around ARR (annual recurring revenue). To increase this metric, it’s crucial to measure and act on churn (attrition, retention), monitoring the economic impact of failed renewals or ARR decreases. The model focuses on selling a solution and ensuring maximum customer adoption, leading to high NPS/CSAT and successful contract renewals, with potential uplifts through upselling and cross-selling. Sales teams cannot handle all these activities alone, which is where the Customer Success team comes in.

Why would you recommend a product or service to your friends? Or why would you trust your friends and family when they recommend a product or service? It’s not just about a great product; it’s about a phenomenal experience, pre- and post-sales, with a product that meets your needs and expectations. Traditionally, significant effort was invested in presales, but post-contract, customers often felt abandoned. When the experience is disrupted often led to non-renewal of contracts, damaged brand reputation, and negative reviews. Therefore, customer success is not just customer support or account management; it encompasses more elements

This paradigm shift changes how companies operate. Making customers successful drives company growth. Marketing activities use customer stories as testaments to your brand promise. Recommendations and reviews are crucial to your strategy, and sales teams highlight the value of being a business partner rather than just a provider.

The experience economy changes how companies operate, metrics to follow, and tactics to use. It requires an integrated, holistic effort to understand customer needs, market knowledge, product familiarity, and a partnership approach. Scaling up this initiative involves prioritization through customer segmentation and aligning engagement based on a tier system, alongside wise use of technology to gather insights and drive automation, all driven by data and predictive AI to forecast customer behavior scenarios.

Education is also vital. SaaS platforms exemplify this, aiming to support companies in using technology efficiently and productively. Ensuring customer success means providing tools and best practices to maximise investment in your solutions. Due to the rapid pace of SaaS platform innovation, constant education and training in new features are critical. High platform usage in a complex environment relies on education. More complex solutions and processes require more high-touch interactions, segmented based on strategy, cost structure, and specific context.

While I have focused on technology cases (specifically SaaS platforms), this applies to any industry. Sports apparel and automotive are examples, as are business school alumni communities driving desired behaviors.

By understanding and implementing these strategies, companies can ensure they are not just providers but loyal companions throughout the customer journey, fostering long-term success and growth.