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Customer Education: How Smart Technology Companies Lock-In Value

Understanding the link between customer education, customer loyalty and customer lifetime value

How Well Do You Know Your Customers?

In this era of data-driven marketing, successful businesses have learned that the more you know about your customers, the more your company is bound to grow. It’s a fact. As Forrester Research confirms, reliable customer intelligence creates value in multiple ways. You can:

  • Shape products and services that better satisfy your existing customer base;
  • Identify, attract, engage and retain more buyers that are a profitable fit for your offerings and,
  • Inform your brand roadmap — whether you sell to businesses, consumers or both.

These goals have fueled widespread popularity of systems that provide customer insights, marketing automation and sales enablement. Even in the late 1990s, before the first customer relationship management system (CRM) was launched, marketing and sales professionals understood the value of “knowing” customers. However, a customer-savvy organization is only half of the equation for sustainable business success.

How Well Do Your Customers Know You?

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What about the customer side of this coin? It makes sense that the more your prospects know about your product or service, the smarter their buying decisions will be. And if your customers understand how your brand addresses their needs, they’re more likely to become devoted fans.

In other words, the easier it is for people to find and use clear, relevant, actionable information throughout their relationship with your organization, the more likely they will choose and use your products, again and again. They’re also likely to recommend your brand to others — a bonus “multiplier” effect!

This is where thoughtful, targeted customer education strategies make a massive difference. Yet, surprisingly few organizations focus on customer training as a way to achieve strategic advantage. This is especially true in the high-technology industry.

For example, look at marketing automation provider, Marketo. The company’s CEO, Phil Fernandez agrees that lack of customer education is a serious obstacle. In fact, he says, “The single biggest growth limiter for our market, is customer education,” because the market is still “in the learning and skill-building phase.”

This raises a critical question: In dynamic industries like software and technology, who should be responsible for educating prospects and customers?

Customer Education: Who’s In Charge?

Sales representatives can’t be expected to carry the entire load – especially in an era where 67% of the typical B2B buyer journey has shifted to digital interactions and content.

But online channels have their own risks. Research shows that when today’s tech-savvy prospects encounter a weak digital experience, they’re much less likely to complete a purchase – even if the brand is a market leader. This means no organization can afford to sit back and wait for potential customers to discover their product and educate themselves about its value.

Fortunately, companies in many sectors are waking up to the fact that customer success is not just about convincing prospects to “close” on a one-time sales transaction. Rather, it’s a complex ongoing process, involving multiple channels, tools and people, over the entire life of a customer relationship.

Business leaders are recognizing that responsibility for customer experience belongs to the whole organization — or at least multiple coordinated functions. Research by Adobe and Econsultancy found that 85% of B2B marketers say consistency across content teams and channels is the backbone of an effective customer experience. Yet coordinating these elements is incredibly complex. In fact, another study revealed that only 12% of marketers are “very effective” at delivering a great customer experience. That leaves enormous of room for improvement, going forward.

The Need for Customer Education is Universal

Complex B2B technology vendors aren’t the only companies facing customer experience challenges. Even simple B2C products and services are finding gaps where learning can help make or break customer relationships.

For example, look at today’s dynamic mobile apps marketplace, where a value proposition may seem simple, but the customer experience stakes are much higher. As mobile product design expert S.C. Moatti says, “If a mobile application oversteps or breaks, or it isn’t intuitive, the cost is very high.” And because people are more emotional about their phones, when something about an app turns them off, they don’t come back easily – if ever. In other words, “If the cost of an error on the web is 1x, the cost of a similar error on mobile is 10x.”

To illustrate, consider the staggering mobile app abandonment rate. One study of 37,000 apps reveals that about 25% of users walk away from an app after only one use, and nearly 62% log in no more than 11 times before they quit. Across all industries, this translates into a 75% user turnover rate within only 90 days! It’s not pretty.

So, how can a thoughtful customer education strategy work together with innovative learning technologies to help resolve these issues? Let’s look at some examples.

When Customer Education Pays: 3 Technology Industry Examples

1) Customer Onboarding 

High-growth, on-demand software companies are discovering the value of “in-app” customer onboarding — training-related content that is embedded directly into existing web and mobile apps via modern learning platforms. This in-context learning experience guides a prospect’s research activities into a seamless discovery-trial-conversion path, removes set-up and customization barriers, and immediately upon purchase provides access to appropriate “getting started” resources and tools.

2) Ongoing Customer Engagement

Many technology and service providers rely on a cloud LMS so they can offer instant access to the latest product training and related content from any device or location – regardless of whether a customer is online or offline. This high availability strengthens customer relationships by providing continuous access to relevant information and guidance they can trust. In addition, as users develop related product knowledge and skills, they can earn professional credentials and certifications that follow them throughout their careers. This naturally strengthens their connection with the product, and deepens their long-term commitment as brand ambassadors.

3) Customer Renewal

Effective onboarding and engagement are essential factors in the customer experience equation. However, a business model is sustainable only if customers are willing to continue investing in your product or service, over time. Online customer training can act as “preventive maintenance” to ward off customer defection, reinforce brand engagement and even increase share-of-wallet. For example, companies that offer free or discounted next-level training prior to a contract renewal date, improve their odds of retaining (or reactivating) profitable customers, and increasing their lifetime value.

These three cases are just a taste of when and where customer education can differentiate your company and create a lasting business advantage. The possibilities are limited only by your resources and imagination.

Closing Notes

Customer education is merely one facet of a comprehensive customer success strategy. But evidence shows that training can work in concert with other customer-focused strategies and systems to fill critical relationship gaps and improve business results.

If you aren’t yet investing in training as a way to engage, retain and profit more fully from customer relationships, your competitors are probably ahead of you. But with so many innovative learning platforms — many designed specifically to support customer education — getting started has never been easier. So what are you waiting for?

 



Want more insights? Watch our on-demand webinar:

The Competitive Advantage of an Externally Facing LMS

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There is tremendous diversity among the nearly 700 learning management systems available today. And when customer education is a top priority, it pays for organizations to choose an LMS designed specifically for that purpose.

What exactly are the business benefits of choosing a specialized learning management system (rather than an employee-oriented LMS) to support customer learning initiatives?

Join John Leh, Talented Learning lead analyst and CEO, and Terry Lydon, VP of Training Operations Projects at Litmos, as they explain the value of choosing an externally focused LMS. Specifically, they discuss: You’ll learn: 

  • How to quantify the benefits of customer learning
  • Which factors set a customer LMS apart from employee-focused platforms
  • What case studies reveal about the value of customer learning technology
  • How to find the best LMS for your customers’ needs, and
  • 5 areas of innovation unique to customer LMS solutions

Replay this free webinar now!


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About Kathleen Kruse (3 Articles)

Kathleen “KK” Kruse has been exploring communication, technology and business dynamics for more than 20 years. As a consultant, she focuses on the space where humans and digital tools intersect — including learning and content strategies, community building and social media, and user experience and information design. A storyteller at heart, KK blends analytical insight, creative vision, and the power of the English language to define and develop narratives that are relevant, useful and persuasive. Her efforts have won credibility and market momentum for some of the world’s most innovative companies, such as Adobe, Apple, Netscape and Yahoo! You can connect with KK on Twitter at (@kkruse) or on LinkedIn at in/kathleenkruse.

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